<PAGE>
================================================================================
AMENDED AND RESTATED
CREDIT AGREEMENT
among
FAIRPOINT COMMUNICATIONS SOLUTIONS CORP.,
VARIOUS LENDING INSTITUTIONS,
BANK OF AMERICA, N.A.,
as SYNDICATION AGENT,
BANKERS TRUST COMPANY,
as DOCUMENTATION AGENT,
and
FIRST UNION NATIONAL BANK,
as ADMINISTRATIVE AGENT
---------------------------------------------
FIRST UNION SECURITIES, INC.
and
BANC OF AMERICA SECURITIES LLC,
as CO-ARRANGERS
and
CO-BOOK MANAGERS
------------------------------------
Dated as of October 20, 1999,
as Amended and Restated as
of March 27, 2000,
and as further
Amended and Restated as of November 9, 2000
------------------------------------
$250,000,000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 1. Definitions...................................................................................1
SECTION 2. Amountand Terms of Credit...................................................................25
2.01 Commitments..............................................................................25
2.02 Minimum Borrowing Amounts, etc...........................................................26
2.03 Notice of Borrowing......................................................................26
2.04 Disbursement of Funds....................................................................27
2.05 Register.................................................................................27
2.06 Conversions..............................................................................28
2.07 Pro Rata Borrowings......................................................................28
2.08 Interest.................................................................................28
2.09 Interest Periods.........................................................................29
2.10 Increased Costs, Illegality, etc.........................................................30
2.11 Compensation.............................................................................32
2.12 Change of Lending Office.................................................................33
2.13 Replacement of Lenders...................................................................33
2.14 AdditionalRevolving Commitments..........................................................34
SECTION 3. Lettersof Credit............................................................................35
3.01 Lettersof Credit.........................................................................35
3.02 MaximumLetter of Credit Outstandings; Final Maturities...................................37
3.03 Letterof Credit Requests; Minimum Stated Amount..........................................37
3.04 Letterof Credit Participations...........................................................37
3.05 Agreementto Repay Letter of Credit Drawings..............................................39
3.06 Increased Costs..........................................................................40
SECTION 4. CommitmentCommission; Fees; Reductions of Commitment........................................41
4.01 Fees.................................................................................... 41
4.02 Voluntary Termination of Commitments.....................................................42
4.03 Mandatory Reductions of Commitments, etc.................................................43
SECTION 5. Payments....................................................................................44
5.01 VoluntaryPrepayments.....................................................................44
5.02 MandatoryRepayments......................................................................45
5.03 Method and Place of Payment..............................................................48
5.04 Net Payments.............................................................................49
SECTION 6. Conditions Precedent.........................................................................51
6.01 Conditions Precedent to Restatement Effective Date.......................................51
</TABLE>
(i)
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
6.02 Conditions Precedent to all Credit Events................................................55
SECTION 7. Representations, Warranties and Agreements...................................................56
7.01 CompanyStatus............................................................................56
7.02 Company Power and Authority..............................................................56
7.03 NoViolation..............................................................................56
7.04 Litigation...............................................................................56
7.05 Use of Proceeds; Margin Regulations......................................................57
7.06 Governmental Approvals...................................................................57
7.07 Investment Company Act...................................................................57
7.08 Public Utility Holding Company Act.......................................................57
7.09 True Disclosure..........................................................................57
7.10 Financial Condition; Financial Statements................................................58
7.11 TheSecurity Documents....................................................................58
7.12 Tax Returns and Payments.................................................................59
7.13 Compliance with ERISA....................................................................59
7.14 Subsidiaries.............................................................................60
7.15 Intellectual Property....................................................................60
7.16 Environmental Matters....................................................................60
7.17 Labor Relations..........................................................................61
7.18 Compliance with Statutes, etc............................................................61
7.19 Indebtedness.............................................................................61
7.20 Insurance................................................................................61
SECTION 8. Affirmative Covenants........................................................................61
8.01 Information Covenants....................................................................62
8.02 Books, Records and Inspections...........................................................63
8.03 Insurance................................................................................63
8.04 Payment of Taxes.........................................................................64
8.05 Corporate Franchises.....................................................................64
8.06 Compliance with Statutes, etc............................................................64
8.07 ERISA....................................................................................64
8.08 Good Repair..............................................................................65
8.09 End of Fiscal Years; Fiscal Quarters.....................................................65
8.10 Approvals................................................................................66
ECTION 9. Negative Covenants............................................................................66
9.01 Business...................................................................................66
9.02 Consolidation, Merger, Sale or Purchase of Assets, etc.....................................66
9.03 Liens......................................................................................67
9.04 Indebtedness...............................................................................69
9.05 Capital Expenditures.......................................................................71
9.06 Advances, Investments and Loans............................................................72
9.07 Limitation on Creation of Subsidiaries.....................................................73
9.08 Modifications..............................................................................73
</TABLE>
(ii)
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
9.09 Dividends, etc...........................................................................73
9.10 Transactions with Affiliates.............................................................75
9.11 MinimumConsolidated Revenue..............................................................75
9.12 MinimumConsolidated EBITDA...............................................................76
9.13 ConsolidatedSenior Debt to Capitalization Ratio..........................................76
9.14 ConsolidatedDebt to Capitalization Ratio.................................................76
9.15 InterestCoverage Ratio...................................................................76
9.16 Leverage Ratio...........................................................................77
9.17 Fixed Charge Ratio.......................................................................77
9.18 Limitation On Issuance of Subsidiary Stock...............................................77
9.19 Limitation on Assets of the Unrestricted Subsidiary......................................78
SECTION 10.Events of Default............................................................................78
10.01 Payments..................................................................................78
10.02 Representations, etc......................................................................78
10.03 Covenants.................................................................................78
10.04 Default Under Other Agreements............................................................78
10.05 Bankruptcy, etc...........................................................................79
10.06 ERISA.....................................................................................79
10.07 Security Documents........................................................................80
10.08 Amended and Restated Subsidiary Guaranty..................................................80
10.09 Amended and Restated Preferred Stock Issuance and Capital Contribution Agreement..........80
10.10 Judgments.................................................................................80
10.11 Change of Control.........................................................................80
10.12 Positive EBITDA...........................................................................80
10.13 Amendment to the Parent Credit Agreement..................................................80
SECTION 11. The Administrative Agent.....................................................................82
11.01 Appointment...............................................................................82
11.02 Nature of Duties..........................................................................82
11.03 Lack of Reliance on the Administrative Agent..............................................82
11.04 Certain Rights of the Administrative Agent................................................83
11.05 Reliance..................................................................................83
11.06 Indemnification...........................................................................83
11.07 The Administrative Agent in its Individual Capacity.......................................83
11.08 Holders of Notes..........................................................................84
11.09 Resignation by the Administrative Agent...................................................84
11.10 Bankof America............................................................................84
SECTION 12. Miscellaneous................................................................................85
12.01 Payment of Expenses, etc..................................................................85
12.02 Right of Setoff...........................................................................85
12.03 Notices...................................................................................86
12.04 Benefit of Agreement; Assignments and Participants........................................86
12.05 No Waiver; Remedies Cumulative............................................................88
</TABLE>
(iii)
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
12.06 Payments Pro Rata.........................................................................88
12.07 Calculations; Computations................................................................89
12.08 Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial....................89
12.09 Counterparts..............................................................................90
12.10 Effectiveness.............................................................................90
12.11 Headings Descriptive......................................................................90
12.12 Amendment or Waiver.......................................................................90
12.13 Survival..................................................................................91
12.14 Domicile of Revolving Loans...............................................................91
12.15 Confidentiality...........................................................................91
12.16 Lender Register...........................................................................92
12.17 Amendment and Restatement of Existing Credit Agreement....................................92
</TABLE>
ANNEX I -- Commitments
ANNEX II -- Addresses
ANNEX III -- ERISA
ANNEX IV -- Subsidiaries
ANNEX V -- Existing Indebtedness
ANNEX VI -- Insurance
ANNEX VII -- Existing Liens
ANNEX VIII -- Existing Investments
ANNEX IX -- Affiliate Transactions
ANNEX X -- Existing Letters of Credit
ANNEX XI -- Approvals
EXHIBIT A -- Form of Notice of Borrowing/Conversion
EXHIBIT B-1 -- Form of Revolving Note
EXHIBIT B-2 -- Form of Term Note
EXHIBIT C -- Form of Letter of Credit Request
EXHIBIT D -- Form of Section 5.04 Certificate
EXHIBIT E -- Form of Opinion of Paul, Hastings, Janofsky & Walker LLP
EXHIBIT F -- Form of Officer's Certificate
EXHIBIT G -- Form of Amended and Restated Subsidiary Guaranty
EXHIBIT H -- Form of Amended and Restated Pledge Agreement
EXHIBIT I -- Form of Amended and Restated Security Agreement
EXHIBIT J -- Form of Solvency Certificate
EXHIBIT K -- Form of Amended and Restated Preferred Stock Issuance and
Capital Contribution Agreement
EXHIBIT L -- Form of Amended and Restated Tax Sharing Agreement
EXHIBIT M -- Form of Assignment Agreement
EXHIBIT N -- Form of Parent Preferred Stock Certificate of Designation
EXHIBIT O -- Form of Compliance Certificate
EXHIBIT P -- Form of Additional Revolving Commitment Agreement
<PAGE>
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October 20,
1999, as amended and restated as of March 27, 2000, and as further amended and
restated as of November 9, 2000, among FAIRPOINT COMMUNICATIONS SOLUTIONS CORP.
(formerly known as FairPoint Communications Corp.), a Delaware corporation (the
"Borrower"), the lenders from time to time party hereto (each, a "Lender" and,
collectively, the "Lenders"), BANC OF AMERICA SECURITIES LLC and FIRST UNION
SECURITIES, INC., as Co-Arrangers and Co-Book Managers (each, a "Co-Arranger"
and together, the "Co-Arrangers"), BANK OF AMERICA, N.A., as Syndication Agent
(the "Syndication Agent"), BANKERS TRUST COMPANY, as Documentation Agent (the
"Documentation Agent"), and FIRST UNION NATIONAL BANK, as Administrative Agent
(the "Administrative Agent"). Unless otherwise defined herein, all capitalized
terms used herein and defined in Section 1 are used herein as so defined.
W I T N E S S E T H :
WHEREAS, the Borrower, the Lenders, the Co-Arrangers, the
Syndication Agent and the Administrative Agent are party to a Credit Agreement,
dated as of October 20, 1999, as amended as of January 11, 2000, and as further
amended and restated as of March 27, 2000 (as the same has been amended,
modified or supplemented to, but not including, the Restatement Effective Date,
the "Existing Credit Agreement"); and
WHEREAS, the parties hereto wish to further amend and restate
the Existing Credit Agreement as herein provided;
NOW, THEREFORE, the parties hereto agree that the Existing
Credit Agreement shall be and is hereby amended and restated in its entirety as
follows:
NOW, THEREFORE, IT IS AGREED:
SECTION 1. DEFINITIONS. As used herein, the following terms
shall have the meanings herein specified unless the context otherwise requires.
Defined terms in this Agreement shall include in the singular number the plural
and in the plural the singular:
"Additional Revolving Commitment" shall mean, for each
Additional RL Lender, any commitment to make Revolving Loans by such Additional
RL Lender pursuant to Section 2.14, in such amount as agreed to by such
Additional RL Lender in the respective Additional Revolving Commitment
Agreement; PROVIDED that on the Additional Revolving Commitment Date upon which
an Additional Revolving Commitment of any Additional RL Lender becomes
effective, such Additional Revolving Commitment of such Additional RL Lender
shall be added to (and thereafter become a part of) the Revolving Commitment of
such Additional RL Lender for all purposes of this Agreement as contemplated by
Section 2.14.
"Additional Revolving Commitment Agreement" shall mean an
Additional Revolving Commitment Agreement substantially in the form of Exhibit P
(appropriately completed).
<PAGE>
"Additional Revolving Commitment Date" shall mean each date
upon which an Additional Revolving Commitment under an Additional Revolving
Commitment Agreement becomes effective as provided in Section 2.14(b).
"Additional RL Lender" shall have the meaning provided in
Section 2.14(b).
"Administrative Agent" shall have the meaning provided in the
first paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to Section 11.09.
"Affiliate" shall mean, with respect to any Person, any other
Person directly or indirectly controlling (which may include, but is not limited
to, all directors and officers of such Person), controlled by, or under direct
or indirect common control with such Person. A Person shall be deemed to control
a corporation if such Person possesses, directly or indirectly, the power (i) to
vote 10% or more of the securities having ordinary voting power for the election
of directors of such corporation or (ii) to direct or cause the direction of the
management and policies of such corporation, whether through the ownership of
voting securities, by contract or otherwise.
"Agents" shall mean and include the Administrative Agent and
the Syndication Agent.
"Aggregate Unutilized Commitment" of any Lender at any time
shall mean the sum of such Lender's Unutilized Revolving Commitment and Term
Commitment at such time.
"Agreement" shall mean this Amended and Restated Credit
Agreement, as the same may be from time to time further modified, amended,
amended and restated and/or supplemented.
"Amended and Restated Pledge Agreement" shall have the meaning
provided in Section 6.01(i).
"Amended and Restated Preferred Stock Issuance and Capital
Contribution Agreement" shall have the meaning provided in Section 6.01(n).
"Amended and Restated Security Agreement" shall have the
meaning provided in Section 6.01(j).
"Amended and Restated Subsidiary Guaranty" shall have the
meaning provided in Section 6.01(h).
"Amended and Restated Tax Sharing Agreement" shall have the
meaning provided in Section 6.01(o)
"Applicable CC Percentage" shall mean the applicable
percentage per annum set forth below based on the Pricing Level ("Pricing
Level") then in effect:
-2-
<PAGE>
Applicable CC
Commitment
Pricing Level Percentage
Level I 1.50%
Level II 1.25%
Level III .75%
For purposes of the foregoing table:
"Pricing Level I" shall mean any fiscal quarter when the sum
of (A) the average aggregate principal amount of all Loans outstanding
during such fiscal quarter and (B) the average Letter of Credit
Outstandings during such quarter is less than 33 1/3% of the sum of (A)
the aggregate outstanding principal amount of all Term Loans at the end
of such fiscal quarter and (B) the Total Commitment at the end of such
fiscal quarter.
"Pricing Level II" shall mean any fiscal quarter when the sum
of (A) the average aggregate principal amount of all Loans outstanding
during such fiscal quarter and (B) the average Letter of Credit
Outstandings during such fiscal quarter is equal to or greater than 33
1/3% and less than 66 2/3% of the sum of (A) the aggregate outstanding
principal amount of all Term Loans at the end of such fiscal quarter
and (B) the Total Commitment at the end of such fiscal quarter.
"Pricing Level III" shall mean any fiscal quarter when the sum
of (A) the average aggregate principal amount of all Loans outstanding
during such fiscal quarter and (B) the average Letter of Credit
Outstandings during such fiscal quarter is equal to or greater than 66
2/3% of the sum of (A) the aggregate outstanding principal amount of
all Term Loans at the end of such fiscal quarter and (B) the Total
Commitment at the end of such fiscal quarter.
"Applicable Margin" shall mean (i) during Phase I, a
percentage per annum equal to, in the case of (A) Base Rate Loans, 3.25% or (B)
Eurodollar Loans, 4.25% and (ii) after Phase I, from and after each day of
delivery of any certificate delivered in accordance with the first sentence of
the following paragraph indicating a different margin than that described in the
immediately preceding clause (i) above (each, a "Start Date") to and including
the applicable End Date described below, the Applicable Margin shall (subject to
any adjustment pursuant to the immediately succeeding paragraph) be that set
forth below opposite the Leverage Ratio indicated to have been achieved in any
certificate delivered in accordance with the following sentence:
-3-
<PAGE>
----------------------- --------------------------- ---------------------------
APPLICABLE MARGIN FOR APPLICABLE MARGIN FOR BASE
EURODOLLAR LOANS RATE LOANS
LEVERAGE RATIO
----------------------- --------------------------- ---------------------------
----------------------- --------------------------- ---------------------------
greater than or equal
to
5.50:1.00 3.75% 2.75%
----------------------- --------------------------- ---------------------------
----------------------- --------------------------- ---------------------------
greater than or equal
to
4.50:1.00 but
less than
5.50:1.00 3.50% 2.50%
----------------------- --------------------------- ---------------------------
----------------------- --------------------------- ---------------------------
greater than or
equal to
3.50:1.00 but
less than
4.50:1.00 3.25% 2.25%
----------------------- --------------------------- ---------------------------
----------------------- --------------------------- ---------------------------
less than
3.50:1.00 3.00% 2.00%
----------------------- --------------------------- ---------------------------
The Leverage Ratio shall be determined based on the delivery
of a certificate of the Borrower by a senior financial officer of the Borrower
to the Administrative Agent and the Lenders, within 45 days of the last day of
any fiscal quarter of the Borrower, which certificate shall set forth the
calculation of the Leverage Ratio as at the last day of the Test Period ended
immediately prior to the relevant Start Date (but determined on a pro forma
basis to give effect to any Permitted Acquisition effected on or prior to the
date of the delivery of such certificate) and the Applicable Margins which shall
be thereafter applicable (until same are changed or cease to apply in accordance
with the following sentences); PROVIDED that at the time of the consummation of
any Permitted Acquisition or disposition of a business, a senior financial
officer of the Borrower shall deliver to the Administrative Agent a certificate
setting forth the calculation of the Leverage Ratio on a PRO fORMA basis as of
the last day of the last Test Period ended prior to the date on which such
Permitted Acquisition is consummated for which financial statements have been
made available (or were required to be made available) pursuant to Section
8.01(a) or (b), as the case may be, and the date of such consummation shall be
deemed to be a Start Date and the Applicable Margins which shall be thereafter
applicable (until same are changed or cease to apply in accordance with the
following sentence) shall be based upon the Leverage Ratio as so calculated. The
Applicable Margins so determined shall apply, except as set forth in the
succeeding sentence, from the relevant Start Date to the earliest of (x) the
date on which the next certificate is delivered to the Administrative Agent, (y)
the date on which the next Permitted Acquisition is consummated or (z) the date
which is 45 days following the last day of the Test Period in which the previous
Start Date occurred (such earliest date, the "End Date"), at which
-4-
<PAGE>
time, if no certificate has been delivered to the Administrative Agent
indicating an entitlement to new Applicable Margins (and thus commencing a new
Start Date), the Applicable Margins shall be those set forth in the table above
determined as if the Leverage Ratio were greater than 5.50:1.00 (such Applicable
Margins as so determined, the "Highest Applicable Margins"). Notwithstanding
anything to the contrary contained above in this definition, the Applicable
Margins shall be the Highest Applicable Margins (subject to further adjustment
to the extent provided in Section 2.08(d)) at all times during Phase II during
which there shall exist any Default or Event of Default.
"Approved Bank" shall have the meaning provided in the
definition of Cash Equivalents.
"Asset Sale" shall mean and include the sale, transfer or
other disposition by the Borrower or any Subsidiary of the Borrower to any
Person other than the Borrower or any Subsidiary Guarantor of any asset of the
Borrower or such Subsidiary (other than sales, transfers or other dispositions
in the ordinary course of business of inventory and/or obsolete or excess
equipment), but in all cases only to the extent that the aggregate Net Cash
Proceeds of all such sales, transfers, dispositions and receipts in any fiscal
year are in excess of $1,000,000.
"Assignment Agreement" shall mean the Assignment Agreement in
the form of Exhibit M (appropriately completed).
"Authorized Officer" shall mean any senior officer of the
Borrower designated as an authorized officer in writing to the Administrative
Agent by the Borrower.
"Bank of America" shall mean Bank of America, N.A., in its
individual capacity, and any successor corporation thereto by merger,
consolidation or otherwise.
"Bankruptcy Code" shall have the meaning provided in Section
10.05.
"Base Rate" at any time shall mean the higher of (i) the
Reference Rate and (ii) the rate which is 1/2 of 1% in excess of the Federal
Funds Rate.
"Base Rate Loan" shall mean each Loan designated or deemed
designated as such by the Borrower at the time of the incurrence thereof or
conversion thereto.
"Borrower" shall have the meaning provided in the first
paragraph of this Agreement.
"Borrowing" shall mean the borrowing of one Type of Loan of a
single Tranche from all the Lenders having Commitments of the respective Tranche
on a given date (or resulting from a conversion or conversions on such date)
having in the case of Eurodollar Loans the same Interest Period, PROVIDED that
Base Rate Loans incurred pursuant to Section 2.10(b) shall be considered part of
the related Borrowing of Eurodollar Loans.
"Business" shall have the meaning provided in Section 9.01.
-5-
<PAGE>
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) below, any day excluding Saturday, Sunday and any day
which shall be in the City of New York and Charlotte, North Carolina a legal
holiday or a day on which banking institutions are authorized by law or other
governmental actions to close and (ii) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
Eurodollar Loans, any day which is a Business Day described in clause (i) and
which is also a day for trading by and between banks in the New York interbank
Eurodollar market.
"Business Plan" shall mean the Borrower's revised business
expansion plan dated as of October 17, 2000, a copy of which was delivered to
the Lenders prior to the Restatement Effective Date.
"Capital Lease" as applied to any Person shall mean any lease
of any property (whether real, personal or mixed) by that Person as lessee
which, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of that Person.
"Capitalized Lease Obligations" shall mean all obligations
under Capital Leases of the Borrower or any of its Subsidiaries in each case
taken at the amount thereof accounted for as liabilities in accordance with
GAAP.
"Cash Equivalents" shall mean (i) securities issued or
directly and fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (PROVIDED that the full faith and credit of
the United States of America is pledged in support thereof) having maturities of
not more than six months from the date of acquisition, (ii) Dollar denominated
time deposits, certificates of deposit and bankers' acceptances of (x) any
Lender that is a domestic commercial bank of recognized standing having capital
and surplus in excess of $500,000,000 or (y) any bank (or the parent company of
such bank) whose short-term commercial paper rating from Standard & Poor's
Ratings Services, a division of McGraw-Hill, Inc. ("S&P") is at least A-1 or the
equivalent thereof or from Moody's Investors Service, Inc. ("Moody's") is at
least P-1 or the equivalent thereof (any such bank, an "Approved Bank"), in each
case with maturities of not more than six months from the date of acquisition,
(iii) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (i) above entered into
with any bank meeting the qualifications specified in clause (ii) above, (iv)
commercial paper issued by any Approved Bank or by the parent company of any
Approved Bank and commercial paper issued by, or guaranteed by, any industrial
or financial company with a short-term commercial paper rating of at least A-1
or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody's, or guaranteed by any industrial company with a long term unsecured debt
rating of at least A or A2, or the equivalent of each thereof, from S&P or
Moody's, as the case may be, and in each case maturing within six months after
the date of acquisition, (v) marketable direct obligations issued by any state
of the United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within six months from the date
of acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either S&P or Moody's, and (vi) investments in
money market funds substantially all of whose assets are comprised of securities
of the type described in clauses (i) through (v) above.
-6-
<PAGE>
"Cash Proceeds" shall mean, with respect to any Asset Sale,
the aggregate cash payments (including any cash received by way of deferred
payment pursuant to a note receivable issued in connection with such Asset Sale,
other than the portion of such deferred payment constituting interest, but only
as and when so received) received by the Borrower and/or any Subsidiary of the
Borrower from such Asset Sale.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C.ss.9601 ET SEQ.
"Change of Control" shall mean at any time and for any reason
(a) prior to a Qualified IPO, the Permitted Holders cease to be the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) on a fully
diluted basis in the aggregate of at least 50.1% of the total economic and
voting interest in Parent's capital stock, (b) on and after a Qualified IPO, (i)
any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act), other than one or more Permitted Holders, is or becomes the
"beneficial owner" (as defined in clause (a) above) on a fully diluted basis of
more than 25% of the total voting interest in the capital stock of Parent or
(ii) during any period of two consecutive years individuals who at the beginning
of such period constituted the Board of Directors of Parent (together with any
new directors whose election by such Board of Directors or whose nomination for
election by the stockholders of Parent was approved by a vote of a majority of
the directors of Parent 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 the
Board of Directors of Parent then in office, (c) a "change of control" or
similar event shall occur as provided in any other agreement governing or
evidencing material Indebtedness (i) of the Borrower or (ii) of Parent resulting
in an event of default thereunder or entitling any holder thereof to require
repayment prior to its stated maturity or (d) Parent, together with the
managers, officers, directors and employees of the Borrower and Parent, shall
cease to directly or indirectly own at least 75% of the capital stock of the
Borrower (although for purposes of this clause (d), the aggregate amount of
capital stock of the Borrower permitted to be held by all such managers,
officers, directors and employees may not exceed 15%).
"CLEC" shall mean one or more competitive local exchange
carriers.
"Co-Arranger" shall have the meaning provided in the first
paragraph of this Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to the Code are to the Code, as in effect at the
date of this Agreement and any subsequent provisions of the Code, amendatory
thereof, supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or
personal) with respect to which any security interests have been granted (or
purported to be granted) pursuant to any Security Document, including, without
limitation, all Pledge Agreement Collateral, all Security Agreement Collateral
and all cash and Cash Equivalents delivered as collateral pursuant to Section
5.02 or 10.
-7-
<PAGE>
"Collateral Agent" shall mean the Administrative Agent acting
as collateral agent for the Lenders.
"Commitment" shall mean any of the Commitments of any Lender,
I.E., whether the Term Commitment or the Revolving Commitment.
"Commitment Commission" shall have the meaning provided in
Section 4.01(a).
"Company" shall mean any corporation, limited liability
company, partnership or other business entity (or the adjectival form thereof,
where appropriate).
"Company Documents" shall mean, with respect to any Company,
such Company's certificate of incorporation, certificate of formation, by-laws,
limited liability company agreement, partnership agreement or equivalent
organizational documents of such Company.
"Compliance Certificate" shall mean a certificate duly
executed in the form of Exhibit O.
"Consolidated Annualized EBITDA" shall mean, as of the last
day of any fiscal quarter, (x) Consolidated EBITDA for the six months then ended
multiplied by (y) two.
"Consolidated Annualized Fixed Charges" shall mean, as of the
last day of any fiscal quarter, (x) Consolidated Fixed Charges for the six
months then ended multiplied by (y) two.
"Consolidated Annualized Interest Expense" shall mean, as of
the last day of any fiscal quarter, (x) Consolidated Interest Expense for the
six months then ended multiplied by (y) two.
"Consolidated Capital Expenditures" shall mean, for any
period, the aggregate of all cash expenditures (including all amounts expended
under Capital Leases but excluding any amount representing capitalized interest)
by the Borrower and its Subsidiaries during that period that, in conformity with
GAAP, are or are required to be included in the property, plant or equipment
reflected in the consolidated balance sheet of the Borrower and its
Subsidiaries, PROVIDED that Consolidated Capital Expenditures shall in any event
(x) exclude the purchase price paid in cash in connection with the acquisition
of any Person (including through the purchase of all of the capital stock or
other ownership interests of such Person or through merger or consolidation)
pursuant to a Permitted Acquisition whether or not allocable to property, plant
and equipment and (y) exclude amounts expended with insurance proceeds.
"Consolidated Cash Equity" shall mean, with respect to each
issuance or sale of any equity by the Borrower or any capital contribution to
the Borrower, the cash proceeds (net of underwriting discounts and commissions
and other costs associated therewith) received by the Borrower from the
respective sale or issuance of its equity or from the respective capital
contribution, including any income taxes recoverable by Parent pursuant to the
Amended and Restated Tax Sharing Agreement, which are recorded by the Borrower
on its balance sheet as a
-8-
<PAGE>
receivable owed by Parent to the Borrower and paid in cash to the Borrower
within 90 days thereof.
"Consolidated Debt" shall mean, as of any date of
determination, without duplication (i) the aggregate stated balance sheet amount
of all Indebtedness of the Borrower and its Subsidiaries on a consolidated basis
as determined in accordance with GAAP, plus (ii) any Indebtedness for borrowed
money of any other Person as to which the Borrower and/or any of its
Subsidiaries has created a guarantee or other Contingent Obligation (but only to
the extent of such guarantee or other Contingent Obligation) plus all contingent
reimbursement obligations in respect of letters of credit (including Letters of
Credit).
"Consolidated Debt to Capitalization Ratio" shall mean, at any
date of determination, the ratio of (x) the remainder of (i) Consolidated Debt
on such date less (ii) the amount, if positive, of cash or Cash Equivalents held
by the Borrower and its Subsidiaries on such date in an amount greater than
$250,000 to (y) Total Capitalization on such date.
"Consolidated EBITDA" shall mean, for any period, the sum of
the amounts for such period of (i) Consolidated Net Income, (ii) provisions for
taxes based on income, (iii) Consolidated Interest Expense, (iv) the non-cash
portion of any retirement, pension plan or deferred compensation expense
incurred by the Borrower or any of its Subsidiaries, (v) depreciation expense
and (vi) amortization expense including any amortization or write-off related to
the write-up of any assets as a result of purchase accounting LESS the sum of
(i) gains on sales of assets (excluding sales in the ordinary course of
business) and other extraordinary gains and other one-time non-cash gains, all
as determined on a consolidated basis in accordance with GAAP, and (ii) any cash
payment in such period that was made in respect of any non-cash deferred
compensation expense incurred in a previous period but only to the extent that
at or about the same time as such cash payment is made the Borrower does not
receive a cash reimbursement in a like amount; PROVIDED that Consolidated EBITDA
for any such period during which a Permitted Acquisition was consummated or a
disposition of a business was effected shall be determined on a PRO FORMA basis
as if such Permitted Acquisition were consummated or disposition effected, as
the case may be, on the first day of such period.
"Consolidated Fixed Charges" shall mean, for any period, the
sum, without duplication, of (i) Consolidated Interest Expense for such period,
(ii) the scheduled principal amount of all amortization payments on all
Indebtedness (including, without limitation, the Term Loans and the principal
component of all Capitalized Lease Obligations) of the Borrower and its
Subsidiaries for such period (as determined on the first day of such period),
(iii) the amount of all cash payments made by the Borrower and its Subsidiaries
in respect of income taxes or income tax liabilities for such period, (iv) the
amount of all Consolidated Capital Expenditures made by the Borrower and its
Subsidiaries for such period and (v) the amount of all cash earn-out payments,
deferred purchase price payments and similar payments made (or required to be
made) by the Borrower and its Subsidiaries for such period in respect of
acquisitions effected prior to the Restatement Effective Date.
-10-
<PAGE>
"Consolidated Gross PP&E" shall mean, at any time, the
aggregate book value of the property, plant and equipment (before depreciation)
of the Borrower and its Subsidiaries at such time on a consolidated basis and
determined in accordance with GAAP.
"Consolidated Interest Expense" shall mean, for any period,
total interest expense (including the portion that is attributable to Capital
Leases in accordance with GAAP) of the Borrower and its Subsidiaries on a
consolidated basis with respect to all outstanding Indebtedness of the Borrower
and its Subsidiaries (including, without limitation, all commissions, discounts
and other fees and charges owed with respect to letters of credit and bankers'
acceptance financing and without duplication net costs and/or net benefits under
Interest Rate Agreements, but excluding, however, amortization of deferred
financing costs to the extent included in total interest expense).
"Consolidated Net Income" shall mean for any period, the net
income (or loss) of the Borrower and its Subsidiaries on a consolidated basis
for such period taken as a single accounting period determined in conformity
with GAAP, PROVIDED that there shall be excluded from the calculation thereof
(without duplication) (i) the income (or loss) of any Person (other than
Subsidiaries of the Borrower) in which any other Person (other than the Borrower
or any of its Subsidiaries) has a joint interest, except to the extent of the
amount of dividends or other distributions actually paid to the Borrower or any
of its Subsidiaries by such Person during such period, (ii) the income (or loss)
of any Person accrued prior to the date it becomes a Subsidiary of the Borrower
or is merged into or consolidated with the Borrower or any of its Subsidiaries
or that Person's assets are acquired by the Borrower or any of its Subsidiaries
and (iii) the income of any Subsidiary of the Borrower to the extent that the
declaration or payment of dividends or similar distributions by that Subsidiary
of that income is not at the time permitted by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary.
"Consolidated Revenue" shall mean, for any period, the
aggregate stated Statement of Operations amount of all revenue of the Borrower
and its Subsidiaries on a consolidated basis as determined in accordance with
GAAP.
"Consolidated Senior Debt" shall mean, at any time, (i)
Consolidated Debt at such time less (ii) any such Consolidated Debt that
constitutes Permitted Subordinated Debt and/or Permitted Refinancing
Indebtedness.
"Consolidated Senior Debt to Capitalization Ratio" shall mean,
at any date of determination, the ratio of (x) the remainder of (i) Consolidated
Senior Debt on such date, less (ii) the amount, if positive, of cash or Cash
Equivalents held by the Borrower and its Subsidiaries on such date in an amount
greater than $250,000 to (y) Total Capitalization.
"Consolidated Senior Debt to Gross PP&E Ratio" shall mean, at
any date of determination, the ratio of (x) the remainder of (i) Consolidated
Senior Debt on such date, less (ii) the amount, if positive, of cash or Cash
Equivalents held by the Borrower and its Subsidiaries on such date in an amount
greater than $250,000 to (y) Consolidated Gross PP&E.
-10-
<PAGE>
"Contingent Obligations" shall mean as to any Person any
obligation of such Person guaranteeing or intending to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (a) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (b) to advance or
supply funds (i) for the purchase or payment of any such primary obligation or
(ii) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (c) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (d) otherwise to assure or hold
harmless the owner of such primary obligation against loss in respect thereof,
PROVIDED, HOWEVER, that the term Contingent Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated maximum of the Contingent Obligation or, if none, the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if there is no stated or determinable amount
of the primary obligation, the maximum reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith.
"Conversion/Contribution Certificate" shall have the meaning
provided in Section 5.02(l).
"Conversion Option" shall have the meaning provided in Section
5.02(k).
"Conversion Option Termination Date" shall mean that date
after the Restatement Effective Date which is the earlier of (i) the date on
which the Borrower submits a Compliance Certificate indicating that the Borrower
has achieved two consecutive fiscal quarters of positive EBITDA or (ii) the date
that the Borrower shall have received at least $315,000,000 of Consolidated Cash
Equity from Parent in excess of that amount theretofore contributed by Parent to
the Borrower as of the Restatement Effective Date.
"Credit Documents" shall mean this Agreement and after the
execution and delivery thereof pursuant to the terms of this Agreement, each
Note, the Amended and Restated Preferred Stock Issuance and Capital Contribution
Agreement, the Amended and Restated Subsidiary Guaranty, each Security Document
and each Additional Revolving Commitment Agreement.
"Credit Event" shall mean the making of any Loans or the
issuance of any Letters of Credit.
"Credit Party" shall mean Parent, the Borrower and each
Subsidiary of the Borrower party to a Credit Document.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
-11-
<PAGE>
"Defaulting Lender" shall mean any Lender with respect to
which a Lender Default is in effect.
"Dividends" shall have the meaning provided in Section 9.09.
"Documentation Agent" shall have the meaning provided in the
first paragraph of this Agreement.
"Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States.
"Drawing" shall have the meaning provided in Section 3.05(b).
"EBITDA Cure" shall have the meaning provided in Section 10.
"Eligible Transferee" shall mean and include a commercial
bank, financial institution or other institutional "accredited investor" as
defined in SEC Regulation D.
"End Date" shall have the meaning provided in the definition
of Applicable Margin.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigations (other than internal
reports prepared by the Borrower or any of its Subsidiaries solely in the
ordinary course of such Person's business and not in response to any third party
action or request of any kind) or proceedings relating to any Environmental Law
or any permit issued, or any approval given, under any such Environmental Law
(hereafter, "Claims"), including, without limitation, (a) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (b) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials arising from alleged injury
or threat of injury to health, safety or the environment.
"Environmental Law" shall mean any applicable federal, state,
foreign or local statute, law, rule, regulation, ordinance, code and rule of
common law now or hereafter in effect and in each case as amended, and any
binding judicial or administrative interpretation thereof, including any binding
judicial or administrative order, consent decree or judgment, relating to the
environment or Hazardous Materials, including, without limitation, CERCLA; RCRA;
the Federal Water Pollution Control Act, as amended, 33 U.S.C. ss. 1251 eT SEq.;
the Toxic Substances Control Act, 15 U.S.C. ss. 7401 ET seq.; the Clean Air Act,
as amended, 42 U.S.C. ss. 7601 eT SEq.; the Safe Drinking Water Act, 42 U.S.C.
ss. 300F ET seq.; the Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 et seq.; and
any applicable state and local or foreign counterparts or equivalents.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
-12-
<PAGE>
Section references to ERISA are to ERISA, as in effect at the date of this
Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with the Borrower or a Subsidiary would be
deemed to be a "single employer" within the meaning of Section 414(b) or (c) of
the Code and with respect to Sections 412 and 4971 of the Code and Section 302
of ERISA, Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Loan" shall mean each Loan designated or deemed
designated as such by the Borrower at the time of the incurrence thereof or
conversion thereto.
"Eurodollar Rate" shall mean (a) the offered quotation to
first-class banks in the New York interbank Eurodollar market by First Union for
Dollar deposits of amounts in immediately available funds comparable to the
outstanding principal amount of the relevant Eurodollar Loan with maturities
comparable to the Interest Period applicable to such Eurodollar Loan commencing
two Business Days thereafter as of 11:00 A.M. (New York time) on the date which
is two Business Days prior to the commencement of such Interest Period, divided
(and rounded upward to the nearest 1/16 of 1%) by (b) a percentage equal to 100%
minus the then stated maximum rate of all reserve requirements (including,
without limitation, any marginal, emergency, supplemental, special or other
reserves required by applicable law) applicable to any member bank of the
Federal Reserve System in respect of Eurocurrency funding or liabilities as
defined in Regulation D (or any successor category of liabilities under
Regulation D).
"Event of Default" shall have the meaning provided in
Section 10.
"Excess Cash Flow" shall mean, for any period, the remainder
of (a) the sum of (i) Consolidated EBITDA for such period, minus (b) the sum of
(i) provisions for cash income taxes based on income for such period, (ii)
Consolidated Interest Expense for such period, (iii) Consolidated Capital
Expenditures made by the Borrower and its Subsidiaries during such period, and
(iv) the aggregate amount of required principal payments of Indebtedness for
borrowed money of the Borrower and its Subsidiaries during such period (other
than repayments of Revolving Loans, PROVIDED that repayments of Revolving Loans
shall be deducted in determining Excess Cash Flow if such repayments were made
as a voluntary prepayment with internally generated funds (but only to the
extent accompanied by a voluntary reduction to the Total Revolving Commitment)).
"Excess Cash Payment Date" shall mean the date occurring 90
days after the last day of each fiscal year of the Borrower (beginning with its
fiscal year ending on December 31, 2002).
"Excess Cash Payment Period" shall mean, with respect to the
repayment required on each Excess Cash Payment Date, the immediately preceding
fiscal year of the Borrower.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
-13-
<PAGE>
"Existing Credit Agreement" shall have the meaning provided in
the recitals to this Agreement, as in effect immediately prior to the
Restatement Effective Date.
"Existing Credit Documents" shall mean the Existing Credit
Agreement, each promissory note executed and delivered pursuant to the Existing
Credit Agreement, the Existing Preferred Stock Issuance and Capital Contribution
Agreement, the Existing Subsidiary Guaranty and each Existing Security Document.
"Existing Indebtedness" shall have the meaning provided in
Section 7.19.
"Existing Lender" shall mean each of the lenders party to the
Existing Credit Agreement on the Restatement Effective Date.
"Existing Letter of Credit" shall have the meaning provided in
section 3.01(c).
"Existing Pledge Agreement" shall mean the Pledge Agreement
executed and delivered pursuant to the Existing Credit Agreement, as in effect
immediately prior to the Restatement Effective Date.
"Existing Preferred Stock Issuance and Capital Contribution
Agreement" shall mean the Preferred Stock Issuance and Capital Contribution
Agreement executed and delivered pursuant to the Existing Credit Agreement, as
in effect immediately prior to the Restatement Effective Date.
"Existing Revolving Loan" shall mean each "Revolving Loan"
under, and as defined in, the Existing Credit Agreement outstanding on the
Restatement Effective Date.
"Existing Subsidiary Guaranty" shall mean the Subsidiary
Guaranty executed and delivered pursuant to the Existing Credit Agreement, as in
effect immediately prior to the Restatement Effective Date.
"Existing Security Agreement" shall mean the Security
Agreement executed and delivered pursuant to the Existing Credit Agreement, as
in effect immediately prior to the Restatement Effective Date.
"Existing Security Document" shall mean and include each of
the Existing Security Agreement and the Existing Pledge Agreement.
"FCC" shall mean the Federal Communications Commission and any
successor regulatory body.
"Federal Funds Rate" shall mean, for any period, a fluctuating
interest rate 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 which is a Business Day, the average of the quotations for such day on such
transactions received
-14-
<PAGE>
by the Administrative Agent from three Federal Funds brokers of recognized
standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to, or referred
to in, Section 4.01.
"Final Maturity Date" shall mean 364 days from the Restatement
Effective Date; PROVIDED that upon receiving the approvals to be obtained
pursuant to Section 8.10(i), the Final Maturity Date shall be extended to
November 9, 2007.
"First Union" shall mean First Union National Bank, in its
individual capacity, and any successor corporation thereto by merger,
consolidation or otherwise.
"Fronting Fee" shall have the meaning provided in Section
4.01(c).
"GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect from time to time; it being understood
and agreed that determinations in accordance with GAAP for purposes of Sections
9.11 through 9.17, including defined terms as used therein, are subject (to the
extent provided therein) to Section 12.07(a).
"Hazardous Materials" shall mean (a) petroleum or petroleum
products, radioactive materials, asbestos in any form that is friable, urea
formaldehyde foam insulation, and radon gas; (b) any chemicals, materials or
substance defined as or included in the definition of "hazardous substances,"
"hazardous waste", "hazardous materials," "extremely hazardous substances,"
"restricted hazardous waste," "toxic substances," "toxic pollutants,"
"contaminants," or "pollutants," or words of similar import, under any
applicable Environmental Law; and (c) any other chemical, material or substance,
the release of which is prohibited, limited or regulated by any governmental
authority.
"Highest Applicable Margin" shall have the meaning provided in
the definition of Applicable Margin.
"Indebtedness" of any Person shall mean, without duplication,
(i) all indebtedness of such Person for borrowed money, (ii) the deferred
purchase price of assets or services which in accordance with GAAP would be
shown on the liability side of the balance sheet of such Person, (iii) the face
amount of all letters of credit issued for the account of such Person and,
without duplication, all unreimbursed drafts drawn thereunder, (iv) all
indebtedness of a second Person secured by any Lien on any property owned by
such first Person, whether or not such indebtedness has been assumed (to the
extent of the lesser of the fair market value of such property or the amount of
such indebtedness), (v) all Capitalized Lease Obligations of such Person, (vi)
all obligations of such Person to pay a specified purchase price for goods or
services whether or not delivered or accepted, i.e., take-or-pay and similar
obligations, (vii) all net obligations of such Person under Interest Rate
Agreements, (viii) all accounts payable of the Borrower and its Subsidiaries not
paid within 90 days of the date such amounts are due and payable and not
contested by the Borrower or its Subsidiaries and (ix) all Contingent
Obligations of such Person (other than Contingent Obligations arising from the
guaranty by such Person of the obligations of the Borrower and/or its
Subsidiaries to the extent such guaranteed obligations do not constitute
-15-
<PAGE>
Indebtedness and are otherwise permitted hereunder), PROVIDED that Indebtedness
shall not include trade payables, accrued expenses and receipt of progress and
advance payments, in each case arising in the ordinary course of business.
"Interest Period" with respect to any Loan shall mean the
interest period applicable thereto, as determined pursuant to Section 2.09.
"Interest Rate Agreement" shall mean any interest rate swap
agreement, any interest rate cap agreement, any interest rate collar agreement
or other similar agreement or arrangement designed to protect the Borrower or
any Subsidiary of the Borrower against fluctuations in interest rates.
"Issuing Lender" shall mean First Union.
"Kelso" shall mean, collectively, Kelso Investment Associates
V, L.P., a Delaware limited partnership, and Kelso Equity Partners V, L.P., a
Delaware limited partnership.
"Kelso Affiliate" shall mean Kelso and each investment fund
controlled by Kelso.
"L/C Supportable Obligations" shall mean obligations for which
a Letter of Credit may be issued in accordance with Section 7.05(a).
"Lender" shall have the meaning provided in the first
paragraph of this Agreement.
"Lender Default" shall mean (i) the refusal (which has not
been retracted) or failure of a Lender to make available its portion of any
Borrowing or to fund its portion of any unreimbursed payment under Section
3.04(c) or (ii) a Lender having notified the Administrative Agent and/or the
Borrower that it does not intend to comply with its obligations under Section 2
or 3.
"Lender Register" shall have the meaning provided in
Section 12.16.
"Letter of Credit" shall have the meaning provided in
Section 3.01(a).
"Letter of Credit Fee" shall have the meaning provided in
Section 4.01(b).
"Letter of Credit Outstandings" shall mean, at any time, the
sum of (i) the aggregate Stated Amount of all outstanding Letters of Credit and
(ii) the amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in
Section 3.03(a).
"Leverage Ratio" shall mean, at any date of determination, the
ratio of (x) the remainder of (i) Consolidated Debt on such date LESS (ii) the
amount, if positive, of the aggregate amount of cash or Cash Equivalents held by
the Borrower and its Subsidiaries on such date in an
-16-
<PAGE>
amount greater than $250,000 to (y) Consolidated Annualized EBITDA as of the
last day of the fiscal quarter then or last ended.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement or any
lease in the nature thereof).
"Loan" shall mean each Term Loan and each Revolving Loan.
"Management Affiliate" shall mean Messrs. Duda, Leach, Thomas,
Johnson and Bergstein or (to the extent same are controlled by one or more of
the foregoing Persons) JED Communications Associates, Inc.
"Management Services Agreement" shall mean the management
agreement dated as of October 20, 1999 between the Borrower and Parent.
"Margin Stock" shall have the meaning provided in
Regulation U.
"Material Adverse Effect" shall mean a material adverse effect
on the business, property, assets, liabilities or condition (financial or
otherwise) (i) of the Borrower and its Subsidiaries taken as a whole or (ii) of
Parent on a stand-alone basis; PROVIDED that the definition of Material Adverse
Effect shall only include clause (ii) for the purposes of Section 6.01(e).
"Material Subsidiary" shall mean any Subsidiary having gross
assets at any time with a value of at least 5% of consolidated gross assets of
the Borrower and its Subsidiaries and/or gross revenues for the last four fiscal
quarters of at least 5% of the consolidated gross revenues of the Borrower and
its Subsidiaries for such period.
"Minimum Borrowing Amount" shall mean in the case of Revolving
Loans and Term Loans, $1,000,000.
"Moody's" shall have the meaning provided in the definition of
Cash Equivalents.
"Multiemployer Plan" shall mean any multiemployer plan as
defined in section 4001(a)(3) of ERISA which is contributed to by (or to which
there is an obligation to contribute of) the Borrower or any of its Subsidiaries
or an ERISA Affiliate and each such plan for the five year period immediately
following the latest date on which the Borrower, any such Subsidiary or ERISA
Affiliate contributed to or had an obligation to contribute to such plan.
"Net Cash Proceeds" shall mean, with respect to any Asset
Sale, the Cash Proceeds resulting therefrom net (without duplication) of
expenses of sale (including payment of principal, premium and interest of
Indebtedness secured by the assets the subject of the Asset Sale and required to
be, and which is, repaid under the terms thereof as a result of such Asset
Sale), and incremental taxes paid or payable as a result thereof.
"Net Debt Proceeds" shall mean, with respect to any incurrence
of Indebtedness for borrowed money, the cash proceeds (net of underwriting
discounts and commissions and
-17-
<PAGE>
other reasonable costs associated therewith) received by the respective Person
from the respective incurrence of such Indebtedness for borrowed money.
"Net Insurance Proceeds" shall mean, with respect to any
Recovery Event, the cash proceeds (net of reasonable costs and taxes incurred in
connection with such Recovery Event) received by the respective Person in
connection with the respective Recovery Event.
"90%-Owned Subsidiary" shall mean any Subsidiary of the
Borrower to the extent at least 90% of the capital stock or other ownership
interests in such Subsidiary is owned directly or indirectly by the Borrower.
"Non-Defaulting Lender" shall mean a Lender that is not a
Defaulting Lender.
"Note" shall mean each Revolving Note and each Term Note.
"Notice of Borrowing" shall have the meaning provided in
Section 2.03.
"Notice of Conversion" shall have the meaning provided in
Section 2.06.
"Notice Office" shall mean the office of the Administrative
Agent located at One First Union Center, 201 S. College Street, CP-06,
Charlotte, North Carolina 28288-0760 or such other office as the Administrative
Agent may designate to the Borrower in writing from time to time.
"Obligations" shall mean all amounts, direct or indirect,
contingent or absolute, of every type or description, and at any time existing,
owing to the Administrative Agent, the Collateral Agent or any Lender pursuant
to the terms of this Agreement or any other Credit Document.
"Parent" shall mean FairPoint Communications, Inc. (formerly
known as MJD Communications, Inc.), a Delaware corporation.
"Parent Credit Agreement" shall mean the credit agreement
among Parent, various lenders party thereto, Bank of America, N.A., as
Syndication Agent, and Bankers Trust Company, as Administrative Agent, dated as
of March 30, 1998 (as such agreement may be amended, supplemented or modified
from time to time).
"Parent Preferred Stock" shall mean preferred stock of Parent
issued pursuant to the Certificate of Designation attached hereto as Exhibit N.
"Participant" shall have the meaning provided in Section 3.04.
"Payment Office" shall mean the office of the Administrative
Agent located at One First Union Center, 201 S. College Street, CP-06,
Charlotte, North Carolina 28288-0760 or such other office as the Administrative
Agent may designate to the Borrower and the Lenders in writing from time to
time.
-18-
<PAGE>
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquired Debt" shall mean Indebtedness of a
Subsidiary acquired after the Restatement Effective Date pursuant to a Permitted
Acquisition, to the extent such Indebtedness was outstanding prior to the
consummation of the Permitted Acquisition and remains outstanding as
Indebtedness of the respective Subsidiary after giving effect thereto, provided
that (i) such Indebtedness was not incurred in connection with or in
anticipation of such Permitted Acquisition or the respective Person becoming
Subsidiary of the Borrower, (ii) such Indebtedness does not constitute
Indebtedness of the Borrower or any of its Subsidiaries other than the
respective Subsidiary acquired pursuant to the respective Permitted Acquisition
and shall not be secured by any assets of any Person other than assets of the
Subsidiary so acquired serving as security therefor at the time of the
respective Permitted Acquisition, (iii) no Person (other than the respective
Subsidiary or a direct parent or a Subsidiary of the respective Subsidiary to
the extent such parent or Subsidiary is acquired in connection with such
Permitted Acquisition) shall have any liability (contingent or otherwise) with
respect to any Permitted Acquired Debt and (iv) the aggregate principal amount
of all such Indebtedness shall not exceed at any time outstanding more than 10%
of the Consolidated Senior Debt at such time.
"Permitted Acquisition" shall mean any acquisition by the
Borrower or any Subsidiary Guarantor of a company, business, division or product
line located in the United States if (i) at least 10 Business Days prior to the
consummation of such acquisition, the Borrower shall deliver to the
Administrative Agent a certificate of the Borrower's chief financial officer
certifying that (and showing calculations in reasonable detail) immediately
prior to, and after giving effect to, such acquisition all the covenants
contained in this Agreement (including Sections 9.11 through 9.17, inclusive),
shall be complied with on a PRO FORMA basis (as if the acquisition had been
consummated on the first day of the six month period then last ended) and (ii)
the acquired company, business, division or product line is in the Business and,
after giving effect to such acquisition, constitutes a Subsidiary of, or (in the
case of a business, division or product line) is owned by, the Borrower or a
Subsidiary thereof.
"Permitted Holders" shall mean, each Kelso Affiliate, each THL
Affiliate and each Management Affiliate.
"Permitted Liens" shall mean Liens described in clauses (a)
through (n), inclusive, of Section 9.03.
"Permitted Refinancing Indebtedness" shall mean any
Indebtedness of the Borrower and/or any Subsidiary of the Borrower issued or
given in exchange for, or the proceeds of which are used to, extend, refinance,
renew, replace, substitute or refund any Indebtedness of such Person permitted
pursuant to Sections 9.04(f), (g), (h), (i) and (j) or any Indebtedness of such
Person issued to so extend, refinance, renew, replace, substitute or refund any
such Indebtedness, so long as (a) such Indebtedness has a weighted average life
to maturity greater than or equal to the weighted average life to maturity of
the Indebtedness being refinanced, (b) such refinancing or renewal does not (i)
increase the amount of such Indebtedness outstanding immediately prior to such
refinancing or renewal (plus interest then due and payable plus any
-19-
<PAGE>
fees incurred in connection with incurring such Indebtedness) or (ii) add
guarantors, obligors or security from that which applied to such Indebtedness
being refinanced or renewed, (c) such refinancing or renewal Indebtedness has
substantially the same (or, from the perspective of the Lenders, more favorable)
subordination provisions, if any, as applied to the Indebtedness being renewed
or refinanced, and (d) all other terms of such refinancing or renewal
(including, without limitation, with respect to the amortization schedules,
redemption provisions, maturities, covenants, defaults and remedies), taken as a
whole, are not less favorable to the respective borrower than those previously
existing with respect to the Indebtedness being refinancing or renewed.
"Permitted Subordinated Debt" shall mean unsecured and
unguaranteed Indebtedness of the Borrower that is fully subordinated to the
payment in full of all of the Obligations.
"Person" shall mean any individual, partnership, joint
venture, firm, corporation, limited liability company, association, trust or
other enterprise or any government or political subdivision or any agency,
department or instrumentality thereof.
"Phase I" shall mean the period from the Restatement Effective
Date through the earlier of (i) the date on which the Borrower submits a
Compliance Certificate indicating that the Borrower has achieved two consecutive
fiscal quarters of positive Consolidated EBITDA or (ii) the last day of the
Borrower's fiscal quarter ending June 30, 2003.
"Phase II" shall mean all times after the conclusion of
Phase I.
"Plan" shall mean any pension plan as defined in Section 3(2)
of ERISA (other than a multiemployer plan as defined in Section 3(37) of ERISA),
which is maintained or contributed to by (or to which there is an obligation to
contribute of) the Borrower or any of its Subsidiaries or an ERISA Affiliate and
that is subject to Title IV of ERISA, and each such plan for the five year
period immediately following the latest date on which the Borrower any such
Subsidiary of the Borrower or an ERISA Affiliate maintained, contributed to or
had an obligation to contribute to such plan.
"Pledge Agreement Collateral" shall mean "Collateral" as
defined in the Amended and Restated Pledge Agreement.
"Pledged Securities" shall mean all the Pledged Securities as
defined in the Amended and Restated Pledge Agreement.
"Projections" shall mean the revised eight year projections of
the Borrower and its Subsidiaries through the fiscal year ending December 31,
2008, which projections are dated as of October 17, 2000 and were distributed to
the Lenders prior to the Restatement Effective Date in connection with the
transactions contemplated by this Agreement.
"PUC" shall mean a public utility commission, public service
commission or any similar agency or commission.
-20-
<PAGE>
"Qualified IPO" shall mean a registered initial public
offering of the common stock of Parent generating proceeds of at least
$75,000,000.
"RCRA" shall mean the Resource Conservation and Recovery Act,
as amended, 42 U.S.C.ss. 6901 ET -- SEQ.
"Recovery Event" shall mean the receipt by the Borrower or any
of its Subsidiaries of any cash insurance proceeds or condemnation awards
payable (i) by reason of theft, loss, physical destruction, damage, taking or
any other similar event with respect to any property or assets of the Borrower
or any of its Subsidiaries and (ii) under any policy of insurance required to be
maintained under Section 8.03.
"Reference Rate" shall mean the rate of interest publicly
announced from time to time by First Union as its "reference rate." It is a rate
set by First Union based upon various factors, including First Union'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 First Union
shall take effect at the opening of business on the day specified in the public
announcement of such change.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.
"Regulation T" shall mean Regulation T of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.
"Regulation U" shall mean Regulation U of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.
"Regulation X" shall mean Regulation X of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.
"Regulation Y" shall mean Regulation Y of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or portion thereof.
"Replaced Lender" shall have the meaning provided in
Section 2.13.
"Replacement Assets" shall have the meaning provided in
Section 5.02(d).
"Replacement Lender" shall have the meaning provided in
Section 2.13.
"Reportable Event" shall mean an event described in Section
4043(c) of ERISA with respect to a Plan that is subject to Title IV of ERISA
other than those events as to which the
-21-
<PAGE>
30-day notice period is waived under subsection .22, .23, .25, .27 or .28 of
PBGC Regulation Section 4043.
"Required Lenders" shall mean Non-Defaulting Lenders the sum
of whose (i) outstanding Term Loans, (ii) Term Commitments and (iii) Revolving
Commitments (or after the termination thereof, outstanding Revolving Loans and
RL Percentages of Letter of Credit Outstandings) represent an amount greater
than the Required Percentage of the sum of (i) the aggregate outstanding amount
of Term Loans of all Non-Defaulting Lenders, (ii) the Total Term Commitment less
the Term Commitments of all Defaulting Lenders and (iii) the Total Revolving
Commitment less the Revolving Commitments of all Defaulting Lenders (or after
the termination thereof, the sum of the then total outstanding Revolving Loans
of Non-Defaulting Lenders and the aggregate RL Percentages of all Non-Defaulting
Lenders of the total Letter of Credit Outstandings at such time).
"Required Percentage" shall mean (i) 66 2/3% at any time there
are four Lenders or less and (ii) 50.1% at any time there are greater than four
Lenders.
"Restatement Effective Date" shall have the meaning provided
in Section 12.10.
"Revolving Commitment" shall mean, with respect to each
Lender, the amount set forth opposite such Lender's name in Annex I hereto
directly below the column entitled "Revolving Commitment," as the same may be
(x) reduced or terminated from time to time pursuant to Sections 4.02, 4.03,
5.02 and/or 10, (y) increased from time to time pursuant to Section 2.14 or (z)
adjusted from time to time as a result of assignments to or from such Lender
pursuant to Section 2.13 and/or 12.04.
"Revolving Loan" shall have the meaning provided in Section
2.01(a).
"Revolving Note" shall have the meaning provided in Section
2.05(a).
"RL Lender" shall mean each Lender with a Revolving Commitment
or with outstanding Revolving Loans.
"RL Percentage" of any RL Lender at any time shall mean a
fraction (expressed as a percentage) the numerator of which is the Revolving
Commitment of such RL Lender at such time and the denominator of which is the
Total Revolving Commitment at such time, PROVIDED that if the RL Percentage of
any RL Lender is to be determined after the Total Revolving Commitment has been
terminated, then the RL Percentages of the RL Lenders shall be determined
immediately prior (and without giving effect) to such termination.
"Scheduled Term Loan Repayment" shall have the meaning
provided in Section 5.02(b).
"SEC" shall have the meaning provided in Section 8.01(g).
"S&P" shall have the meaning provided in the definition of
Cash Equivalents.
-22-
<PAGE>
"SEC Regulation D" shall mean Regulation D as promulgated
under the Securities Act of 1933, as amended, as the same may be in effect from
time to time.
"Section 5.04 Certificate" shall have the meaning provided in
Section 5.04(b)(ii).
"Secured Creditor" shall have the meaning assigned the term in
the respective Security Documents.
"Security Agreement Collateral" shall mean all "Collateral" as
defined in the Amended and Restated Security Agreement.
"Security Document" shall mean and include each of the Amended
and Restated Security Agreement and the Amended and Restated Pledge Agreement.
"Standby Letter of Credit" shall have the meaning provided in
Section 3.01(a).
"Start Date" shall have the meaning provided in the definition
of Applicable Margin.
"Stated Amount" of each Letter of Credit shall mean, at any
time, the maximum amount available to be drawn thereunder (in each case
determined without regard to whether any conditions to drawing could then be
met).
"Subsidiary" of any Person shall mean and include (i) any
corporation more than 50% of whose stock of any class or classes having by the
terms thereof ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time stock of any class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency) is at the time owned by such Person directly
or indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Notwithstanding
the foregoing, the Unrestricted Subsidiary shall not be considered a Subsidiary
of the Borrower except for the purposes of Sections 7.04, 7.12, 7.13, 8.01(f),
8.04, 8.07, 9.10, 10.05, 10.06 and 10.10. Unless otherwise expressly provided,
all references herein to "Subsidiary" shall mean a Subsidiary of the Borrower.
"Subsidiary Guarantors" shall mean each Subsidiary party to
the Amended and Restated Subsidiary Guaranty.
"Syndication Agent" shall have the meaning provided in the
first paragraph of this Agreement.
"Taxes" shall have the meaning provided in Section 5.04(a).
"Term Commitment" shall mean, for each Lender, the amount set
forth opposite such Lender's name on Schedule I directly below the column
entitled "Term Commitment," as the same may be (x) reduced from time to time
pursuant to Sections 4.02, 4.03, 5.02 and/or 10 or
-23-
<PAGE>
(y) adjusted from time to time as a result of assignments to or from such Lender
pursuant to Sections 2.13 and/or 12.04.
"Term Loan" shall have the meaning provided in
Section 2.01(b).
"Term Loan Borrowing Date" shall mean each date upon which the
Borrower incurs any Term Loans.
"Term Loan Commitment Termination Date" shall mean
November 9, 2001.
"Term Note" shall have the meaning provided in
Section 2.05(a).
"Test Period" shall mean the four consecutive fiscal quarters
of the Borrower then last ended (in each case taken as one accounting period).
"THL" shall mean THL Equity Advisors IV, LLC.
"THL Affiliate" shall mean THL and each investment fund
controlled by THL and certain parties that are related to THL that are invested
in the Parent.
"Total Capitalization" shall mean, at any date of
determination, the sum of Consolidated Debt on such date plus the sum of (i)
$80,327,715 and (ii) the aggregate amount of Consolidated Cash Equity received
by the Borrower after the Restatement Effective Date and until and including the
date of determination.
"Total Commitment" shall mean, at any time, the sum of the
Commitments of each of the Lenders at such time.
"Total Revolving Commitment" shall mean, at any time, the sum
of the Revolving Commitments of each of the Lenders at such time.
"Total Term Commitment" shall mean, at any time, the sum of
the Term Commitments of each of the Lenders at such time.
"Total Unutilized Revolving Commitment" shall mean, at any
time, an amount equal to the remainder of (x) the Total Revolving Commitment
then in effect less (y) the sum of the aggregate principal amount of all
Revolving Loans then outstanding plus the then aggregate amount of all Letter of
Credit Outstandings.
"Trade Letter of Credit" shall have the meaning provided in
Section 3.01(a).
"Tranche" shall mean the respective facility and commitments
utilized in making Loans hereunder, with there being two separate Tranches,
I.E., (i) Term Loans and (ii) Revolving Loans.
"Trigger Event" shall have the meaning provided in
Section 5.02(k).
-24-
<PAGE>
"Type" shall mean any type of Loan determined with respect to
the interest option applicable thereto, I.E., a Base Rate Loan or a Eurodollar
Loan.
"UCC" shall mean the Uniform Commercial Code as in effect from
time to time in New York.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the actuarial present value of the accumulated plan
benefits under the Plan as of the close of its most recent plan year, determined
in accordance with actuarial assumptions at such time consistent with Statement
of Financial Accounting Standards No. 87, exceeds the market value of the assets
allocable thereto.
"Unpaid Drawing" shall have the meaning provided in
Section 3.05(a).
"Unrestricted Subsidiary" shall mean a Subsidiary of the
Borrower (whether existing on or after the Restatement Effective Date) which
shall have as its sole asset the Borrower's membership interest at any time in
Northeast Competitive Access Providers, LLC.
"Unutilized Revolving Commitment" shall mean, with respect to
any Lender at any time, such Lender's Revolving Commitment at such time less the
sum of (i) the aggregate outstanding principal amount of all Revolving Loans
made by such Lender at such time and (ii) such Lender's RL Percentage of the
Letter of Credit Outstandings at such time.
"U.S." shall mean the United States of America.
"Wholly-Owned Subsidiary" of any Person shall mean any
Subsidiary of such Person to the extent all of the capital stock or other
ownership interests in such Subsidiary, other than directors' qualifying shares,
is owned directly or indirectly by such Person.
"Written" or "in writing" shall mean any form of written
communication or a communication by means of telex, facsimile transmission,
telegraph or cable.
SECTION 2. AMOUNT AND TERMS OF CREDIT.
2.01 COMMITMENTS. (a) Subject to and upon the terms and
conditions set forth herein, each Lender with a Revolving Commitment severally
agrees to make, at any time and from time to time on and after the Restatement
Effective Date and prior to the Final Maturity Date, a revolving loan or
revolving loans (each, a "Revolving Loan" and, collectively, the "Revolving
Loans") to the Borrower, which Revolving Loans (i) shall, at the option of the
Borrower, be incurred and maintained as, and/or converted into, Base Rate Loans
or Eurodollar Loans, PROVIDED that, except as otherwise specifically provided in
Section 2.10(b), all Revolving Loans comprising the same Borrowing shall at all
times be of the same Type, (ii) may be repaid and reborrowed in accordance with
the provisions hereof, (iii) may not be incurred by the Borrower unless if,
after giving effect thereto, (A) the Consolidated Senior Debt to Capitalization
Ratio is not greater than 50% and (B) the Consolidated Senior Debt to Gross PP&E
Ratio is not greater than 120%, (iv) shall not exceed for any such Lender at any
time outstanding that aggregate principal amount which, when added to the
product of (x) such Lender's RL
-25-
<PAGE>
Percentage and (y) the aggregate amount of all Letter of Credit Outstandings
(exclusive of Unpaid Drawings which are repaid with the proceeds of, and
simultaneously with the incurrence of, the respective incurrence of Revolving
Loans) at such time, equals the Revolving Commitment of such Lender at such time
and (v) shall not exceed for all such Lenders at any time outstanding that
aggregate principal amount which, when added to the aggregate amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) at such time, equals the Total Revolving
Commitment at such time.
(b) Subject to and upon the terms and conditions set forth
herein, each Lender with a Term Commitment severally agrees to make, at any time
and from time to time on and after the Restatement Effective Date and on or
prior to the Term Loan Commitment Termination Date, a term loan or term loans
(each, a "Term Loan" and, collectively, the "Term Loans") to the Borrower, which
Term Loans (i) shall, at the option of the Borrower, be incurred and maintained
as, and/or converted into, Base Rate Loans or Eurodollar Loans, PROVIDED that,
except as otherwise specifically provided in Section 2.10(b), all Term Loans
comprising the same Borrowing shall at all times be of the same Type, (ii) may
not be incurred by the Borrower unless if, after giving effect thereto, (A) the
Consolidated Senior Debt to Capitalization Ratio is not greater than 50% and (B)
the Consolidated Senior Debt to Gross PP&E Ratio is not greater than 120%, and
(iii) shall be made by each such Lender in that aggregate principal amount which
does not exceed the Term Commitment of such Lender on any Term Loan Borrowing
Date (before giving effect to the incurrence of Term Loans on such date),
provided that at least $50,000,000 of Term Loans shall be incurred on the
Restatement Effective Date. Once repaid, Term Loans incurred hereunder may not
be reborrowed.
2.02 MINIMUM BORROWING AMOUNTS, ETC. The aggregate principal
amount of each Borrowing of Loans under a respective Tranche shall not be less
than the Minimum Borrowing Amount applicable to such Tranche. More than one
Borrowing may be incurred on any day, provided that at no time shall there be
outstanding more than 8 Borrowings of Eurodollar Loans in the aggregate for both
Tranches of Loans.
2.03 NOTICE OF BORROWING. (a) Whenever the Borrower desires to
incur Loans hereunder, it shall give the Administrative Agent at its Notice
Office, (x) prior to 12:00 Noon (New York time), at least three Business Days'
prior written notice (or telephonic notice promptly confirmed in writing) of
each proposed incurrence of Eurodollar Loans and (y) prior to 11:00 A.M. (New
York time) on the proposed date thereof, written notice (or telephonic notice
promptly confirmed in writing) of each proposed incurrence of Base Rate Loans
(other than Revolving Loans made pursuant to Section 3.05(a)(ii)). Each such
notice (each, a "Notice of Borrowing") shall be in the form of Exhibit A and
shall specify (i) the aggregate principal amount of the Loans to be made
pursuant to such incurrence, (ii) the date of incurrence (which shall be a
Business Day), (iii) whether the Loans to be made pursuant to such incurrence
shall be Term Loans or Revolving Loans and (iv) whether the respective Borrowing
shall consist of Base Rate Loans or, to the extent permitted hereunder,
Eurodollar Loans and if Eurodollar Loans, the Interest Period to be initially
applicable thereto. The Administrative Agent shall promptly give each Lender
that is required to make Loans of the Tranche specified in the respective Notice
of Borrowing written notice (or telephonic notice promptly confirmed in writing)
of each proposed
-26-
<PAGE>
incurrence of such Loans and of such Lender's proportionate share thereof and of
the other matters covered by the Notice of Borrowing.
(b) The Borrower irrevocably agrees, by accepting the issuance
of any Letter of Credit, to the incurrence of Revolving Loans as set forth in
Section 3.05(a)(ii).
(c) Without in any way limiting the obligation of the Borrower
to confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent, prior to receipt of written confirmation, may act without
liability upon the basis of and consistent with such telephonic notice, believed
by the Administrative Agent in good faith to be from an Authorized Officer of
the Borrower. In each such case, the Borrower hereby waives the right to dispute
the Administrative Agent's record of the terms of such telephonic notice, unless
such record reflects gross negligence or willful misconduct on the part of the
Administrative Agent.
2.04 DISBURSEMENT OF FUNDS. (a) No later than 1:00 P.M. (New
York time) on the date specified in each Notice of Borrowing, each Lender with a
Commitment of the relevant Tranche will make available its PRO RATA share of
each such Borrowing requested to be made on such date. All such amounts shall be
made available to the Administrative Agent in Dollars and immediately available
funds at the Payment Office and the Administrative Agent promptly (but in no
event later than 4:00 P.M. (New York time)) will make available to the Borrower
by depositing to its account at the Payment Office or as otherwise directed in
the applicable Notice of Borrowing the aggregate of the amounts so made
available in the type of funds received. Unless the Administrative Agent shall
have been notified by any Lender prior to the date of the proposed incurrence
that such Lender does not intend to make available to the Administrative Agent
its portion of the Borrowing or Borrowings to be made on such date, the
Administrative Agent may assume that such Lender has made such amount available
to the Administrative Agent on such date, and the Administrative Agent, in
reliance upon such assumption, may (in its sole discretion and without any
obligation to do so) make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the Administrative
Agent by such Lender and the Administrative Agent has made available same to the
Borrower, the Administrative Agent shall be entitled to recover such
corresponding amount from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Administrative Agent's demand therefor,
the Administrative Agent may notify the Borrower, and, upon receipt of such
notice, the Borrower shall pay such corresponding amount to the Administrative
Agent as promptly as practicable. The Administrative Agent shall also be
entitled to recover on demand from such Lender or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from the date
such corresponding amount was made available by the Administrative Agent to the
Borrower to the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to (x) if paid by such Lender,
the overnight Federal Funds Rate or (y) if paid by the Borrower, the then
applicable rate of interest, calculated in accordance with Section 2.08, for the
respective Loans.
(b) Nothing herein shall be deemed to relieve any Lender from
its obligation to fulfill its commitments hereunder or to prejudice any rights
which the Borrower may have against any Lender as a result of any default by
such Lender hereunder.
-27-
<PAGE>
2.05 REGISTER. (a) The Borrower's obligation to pay the
principal of, and interest on, the Loans made to it by each Lender shall be set
forth in the Lender Register maintained by the Administrative Agent pursuant to
Section 12.16, and if requested by any Lender shall be evidenced, (i) if
Revolving Loans, by a promissory note substantially in the form of Exhibit B-1
with blanks appropriately completed in conformity herewith (each such note, a
"Revolving Note" and, collectively, the "Revolving Notes"), and (ii) if Term
Loans, by a promissory note substantially in the form of Exhibit B-2 with blanks
appropriately completed in conformity herewith (each such note, a "Term Note"
and, collectively, the "Term Notes").
(b) Each Lender will note on its internal records the amount
of each Loan made by it and each payment in respect thereof and will, prior to
any transfer of any of its Notes, endorse on the reverse side thereof the
outstanding principal amount of Loans evidenced thereby. Failure to make any
such notation shall not affect the Borrower's obligations in respect of such
Loans.
2.06 CONVERSIONS. The Borrower shall have the option to
convert on any Business Day all or a portion at least equal to the applicable
Minimum Borrowing Amount of the outstanding principal amount of Loans made
pursuant to one or more Borrowings (so long as of the same Tranche) of one or
more Types of Loans into a Borrowing (of the same Tranche) of another Type of
Loans PROVIDED that (i) no partial conversion of a Borrowing of Eurodollar Loans
shall reduce the outstanding principal amount of the Eurodollar Loans made
pursuant to such Borrowing to less than the Minimum Borrowing Amount applicable
thereto, (ii) Loans which are Base Rate Loans may not be converted into
Eurodollar Loans when a Default under Section 10.01 or an Event of Default is in
existence on the date of the proposed conversion if the Administrative Agent or
the Required Lenders shall have determined in its or their sole discretion not
to permit such conversion and (iii) Borrowings of Eurodollar Loans resulting
from this Section 2.06 shall be limited in number as provided in Section 2.02.
Each such conversion shall be effected by the Borrower giving the Administrative
Agent at its Notice Office, prior to 12:00 Noon (New York time), at least three
Business Days' (or one Business Day's, in the case of a conversion into Base
Rate Loans) prior written notice (or telephonic notice promptly confirmed in
writing) (each, a "Notice of Conversion") which shall be in the form of Exhibit
A and shall specify the Loans to be so converted, the Type of Loans to be
converted into and, if to be converted into a Borrowing of Eurodollar Loans, the
Interest Period to be initially applicable thereto. The Administrative Agent
shall give each Lender prompt notice of any such proposed conversion affecting
any of its Loans. Upon any such conversion the proceeds thereof will be deemed
to be applied directly on the day of such conversion to prepay the outstanding
principal amount of the Loans being converted.
2.07 PRO RATA BORROWINGS. All Borrowings of Revolving Loans
and Term Loans under this Agreement shall be incurred by the Lenders PRO RATA on
the basis of their Revolving Commitments or Term Commitments, as the case may
be. It is understood that no Lender shall be responsible for any default by any
other Lender in its obligation to make Loans hereunder and that each Lender
shall be obligated to make the Loans provided to be made by it hereunder,
regardless of the failure of any other Lender to fulfill its commitments
hereunder.
-28-
<PAGE>
2.08 INTEREST. (a) The unpaid principal amount of each Base
Rate Loan shall bear interest from the date of the Borrowing thereof until the
earlier of repayment or conversion thereof or maturity (whether by acceleration
or otherwise) at a rate per annum which shall at all times be the Applicable
Margin for Base Rate Loans plus the Base Rate in effect from time to time.
(b) The unpaid principal amount of each Eurodollar Loan shall
bear interest from the date of the Borrowing thereof until the earlier of
repayment or conversion thereof or maturity (whether by acceleration or
otherwise) at a rate per annum which shall at all times be the Applicable Margin
for Eurodollar Loans plus the relevant Eurodollar Rate.
(c) Interest in respect of any overdue amount payable
hereunder shall accrue at a rate per annum equal to the greater of (x) the Base
Rate in effect from time to time plus the sum of (i) 2% and (ii) the Applicable
Margin for Base Rate Loans or (y) the rate which is 2% in excess of the rate
borne by such Loans.
Interest which accrues under this Section 2.08(c) shall be payable on demand.
(d) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any repayment thereof and shall be
payable (i) in respect of each Base Rate Loan, quarterly in arrears on the last
Business Day of each March, June, September and December, (ii) in respect of
each Eurodollar Loan, on the last day of each Interest Period applicable thereto
and, in the case of an Interest Period in excess of three months, on each date
occurring at three month intervals after the first day of such Interest Period
and, on any prepayment or conversion (on the amount prepaid or converted) and
(iii) in respect of each such Loan, at maturity (whether by acceleration or
otherwise) and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section 12.07(b).
(f) The Administrative Agent, upon determining the interest
rate for any Borrowing of Eurodollar Loans for any Interest Period, shall
promptly notify the Borrower and the Lenders thereof.
2.09 INTEREST PERIODS. (a) At the time the Borrower gives a
Notice of Borrowing or Notice of Conversion in respect of the making of, or
conversion into, a Borrowing of Eurodollar Loans (in the case of the initial
Interest Period applicable thereto) or prior to 12:00 Noon (New York time) on
the third Business Day prior to the expiration of an Interest Period applicable
to a Borrowing of Eurodollar Loans, it shall have the right to elect by giving
the Administrative Agent written notice (or telephonic notice promptly confirmed
in writing) the Interest Period applicable to such Borrowing, which Interest
Period shall, at the option of the Borrower, be a one, two, three, six or, to
the extent available to each Lender under the relevant Tranche, nine or twelve
month period. Notwithstanding anything to the contrary contained above:
(i) the initial Interest Period for any Borrowing of Eurodollar
Loans shall commence on the date of such Borrowing (including the date
of any conversion from a
-29-
<PAGE>
Borrowing of Base Rate Loans) and each Interest Period occurring
thereafter in respect of such Borrowing shall commence on the day on
which the next preceding Interest Period expires;
(ii) if any Interest Period begins on a day for which there is
no numerically corresponding day in the calendar month at the end of
such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iii) if any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day, provided that if any Interest Period
would otherwise expire on a day which is not a Business Day but is a
day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business
Day;
(iv) no Interest Period in respect of any Borrowing of
Eurodollar Loans shall be selected which extends beyond the Final
Maturity Date;
(v) no Interest Period may be elected at any time when a
Default under Section 10.01 or an Event of Default is then in existence
if the Administrative Agent or the Required Lenders shall have
determined in its or their sole discretion not to permit such election;
and
(vi) no Interest Period in respect of any Borrowing of Term
Loans shall be selected which extends beyond any date upon which a
mandatory repayment of Term Loans will be required to be made under
Section 5.02(b) if the aggregate principal amount of Term Loans which
have Interest Periods which will expire after such date will be in
excess of the aggregate principal amount of Term Loans then outstanding
less the aggregate amount of such required repayment.
(b) If upon the expiration of any Interest Period, the
Borrower has failed to (or may not) elect a new Interest Period to be applicable
to the respective Borrowing of Eurodollar Loans as provided above, the Borrower
shall be deemed to have elected to convert such Borrowing into a Borrowing of
Base Rate Loans effective as of such expiration.
2.10 INCREASED COSTS, ILLEGALITY, ETC. (a) In the event that
(x) in the case of clause (i) below, the Administrative Agent or (y) in the case
of clauses (ii) and (iii) below, any Lender shall have determined (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period that, by reason of any changes arising after the date
of this Agreement affecting the interbank Eurodollar market, adequate
and fair means do not exist for ascertaining the applicable interest
rate on the basis provided for in the definition of Eurodollar Rate or
the making or continuance of any Eurodollar Loan has become
impracticable as a result of a contingency occurring after the
Restatement Effective Date which materially and adversely affects the
interbank Eurodollar market;
-30-
<PAGE>
(ii) at any time, that such Lender shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loans (other than taxes covered by Section
5.04 and any increased cost or reduction in the amount received or
receivable resulting from the imposition of or a change in the rate of
taxes or similar charges or determined by reference to the net income
or profits of such Lender pursuant to the laws of the jurisdiction in
which it is organized or in which its principal office or applicable
lending office is located or any subdivision thereof or therein)
because of (x) any change since the Restatement Effective Date in any
applicable law, governmental rule, regulation, guideline or order (or
in the interpretation or administration thereof and including the
introduction of any new law or governmental rule, regulation, guideline
or order) (such as, for example, but not limited to, a change in
official reserve requirements, but, in all events, excluding reserves
required under Regulation D to the extent included in the computation
of the Eurodollar Rate) and/or (y) other circumstances affecting the
interbank Eurodollar market or the position of such Lender in such
market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has become unlawful by compliance by such Lender in
good faith with any law, governmental rule, regulation, guideline or
order (or would conflict with any such governmental rule, regulation,
guideline or order not having the force of law but with which such
Lender customarily complies even though the failure to comply therewith
would not be unlawful);
then, and in any such event, such Lender (or the Administrative Agent in the
case of clause (i) above) shall (x) on such date and (y) within ten Business
Days of the date on which such event no longer exists give notice (by telephone
confirmed in writing) to the Borrower and to the Administrative Agent of such
determination (which notice the Administrative Agent shall promptly transmit to
each of the other Lenders). Thereafter (x) in the case of clause (i) above,
Eurodollar Loans shall no longer be available until such time as the
Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice by the Administrative Agent no longer
exist, and any Notice of Borrowing or Notice of Conversion given by the Borrower
with respect to Eurodollar Loans which have not yet been incurred shall be
deemed rescinded by the Borrower, (y) in the case of clause (ii) above, the
Borrower shall pay to such Lender, within 10 Business Days after the Borrower's
receipt of written demand therefor, such additional amounts (in the form of an
increased rate of, or a different method of calculating, interest or otherwise
as such Lender in its reasonable discretion shall determine after consultation
with the Borrower) as shall be required to compensate such Lender for such
increased costs or reductions in amounts receivable hereunder (a written notice
as to the additional amounts owed to such Lender, describing the basis for such
increased costs and showing the calculation thereof, submitted to the Borrower
by such Lender shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) and (z) in the case of clause (iii) above, the Borrower
shall take one of the actions specified in Section 2.10(b) as promptly as
possible and, in any event, within the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 2.10(a)(ii), the Borrower may (and in the
case of a Eurodollar Loan affected
-31-
<PAGE>
pursuant to Section 2.10(a)(iii), the Borrower shall within the time period
required by law) either (x) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, cancel said Borrowing by giving the Administrative
Agent telephonic notice (confirmed promptly in writing) thereof on the same date
that the Borrower was notified by a Lender pursuant to Section 2.10(a)(ii) or
(iii), or (y) if the affected Eurodollar Loan is then outstanding, upon at least
three Business Days' notice to the Administrative Agent, require the affected
Lender to convert each such Eurodollar Loan into a Base Rate Loan (which
conversion, in the case of the circumstances described in Section 2.10(a)(iii),
shall occur no later than the last day of the Interest Period then applicable to
such Eurodollar Loan (or such earlier date as shall be required by applicable
law)); PROVIDED that if more than one Lender is affected at any time, then all
affected Lenders must be treated the same pursuant to this Section 2.10(b).
(c) If any Lender shall have determined that the adoption or
effectiveness of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, in each case
after the Restatement Effective Date, or compliance by such Lender or its parent
corporation with any request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central bank or comparable
agency first made after the Restatement Effective Date, has or would have the
effect of reducing the rate of return on such Lender's or its parent
corporation's capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender or its parent
corporation could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's or its parent corporation's
policies with respect to capital adequacy), then from time to time, within 10
Business Days after demand by such Lender (with a copy to the Administrative
Agent), the Borrower shall pay to such Lender such additional amount or amounts
as will compensate such Lender or its parent corporation for such reduction.
Each Lender, upon determining in good faith that any additional amounts will be
payable pursuant to this Section 2.10(c), will give prompt written notice
thereof to the Borrower, which notice shall describe the basis for such claim
and set forth in reasonable detail the calculation of such additional amounts,
although the failure to give any such notice shall not release or diminish any
of the Borrower's obligations to pay additional amounts pursuant to this Section
2.10(c) upon the subsequent receipt of such notice.
2.11 COMPENSATION. (a) The Borrower shall, without
duplication, compensate each Lender, upon its written request (which request
shall set forth the basis for requesting such compensation and reasonably
detailed calculations thereof), for all reasonable losses, expenses and
liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other funds
required by such Lender to fund its Eurodollar Loans but excluding in any event
the loss of anticipated profits) which such Lender may sustain: (i) if for any
reason (other than a default by any Lender or the Administrative Agent) a
Borrowing of Eurodollar Loans by the Borrower does not occur on a date specified
therefor in a Notice of Borrowing or Notice of Conversion (whether or not
withdrawn by the Borrower or deemed withdrawn pursuant to Section 2.10(a)); (ii)
if any prepayment, repayment or conversion of any of its Eurodollar Loans occurs
on a date which is not the last day of an Interest Period applicable thereto;
(iii) if any prepayment of any of its Eurodollar Loans is not made on any date
specified in a notice of prepayment given by the Borrower; or (iv) as a
-32-
<PAGE>
consequence of (x) any other default by the Borrower to repay its Eurodollar
Loans when required by the terms of this Agreement or (y) an election made
pursuant to Section 2.10(b).
(b) Notwithstanding anything in this Agreement to the
contrary, to the extent any notice or request required by Section 2.10, 2.11,
3.06 or 5.04 is given by any Lender more than 90 days after such Lender
obtained, or reasonably should have obtained, knowledge of the occurrence of the
event giving rise to the additional costs, reductions in amounts, losses, taxes
or other additional amounts of the type described in such Section, such Lender
shall not be entitled to compensation under Section 2.10, 2.11, 3.06 or 5.04 for
any amounts incurred or accruing prior to the giving of such notice to the
Borrower.
2.12 CHANGE OF LENDING OFFICE. Each Lender agrees that, upon
the occurrence of any event giving rise to the operation of Section 2.10(a)(ii)
or (iii), 2.10(c), 3.06 or 5.04 with respect to such Lender, it will, if
requested by the Borrower, use reasonable efforts (subject to overall policy
considerations of such Lender) to designate another lending office for any Loans
affected by such event, PROVIDED that such designation is made on such terms
that such Lender and its lending office suffer no material economic, legal or
regulatory disadvantage, with the object of avoiding the consequence of the
event giving rise to the operation of any such Section. Nothing in this Section
2.12 shall affect or postpone any of the obligations of the Borrower or the
right of any Lender provided in Section 2.10, 3.06 or 5.04.
2.13 REPLACEMENT OF LENDERS. (w) If any Lender becomes a
Defaulting Lender or otherwise defaults in its obligations to make Loans, (x)
upon the occurrence of an event giving rise to the operation of Section
2.10(a)(ii) or (iii), Section 2.10(c), Section 3.06 or Section 5.04 with respect
to any Lender which results in such Lender charging to the Borrower increased
costs in excess of those being generally charged by the other Lenders, (y) upon
the occurrence of an event giving rise to the operation of Section 5.02(k) with
respect to any Lender which results in such Lender exercising its Conversion
Option or (z) in the case of a refusal by a Lender to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Lenders as (and to the
extent) provided in Section 12.12(b), the Borrower shall have the right, if no
Default or Event of Default then exists (or, (I) in the case of the preceding
clause (y) whether or not a Default or an Event of Default exists and (II) in
the case of preceding clause (z), no Default or Event of Default will exist
immediately after giving effect to such replacement), to replace such Lender
(the "Replaced Lender") with one or more other Eligible Transferees, none of
whom shall constitute a Defaulting Lender at the time of such replacement
(collectively, the "Replacement Lender") and each of whom shall be required to
be reasonably acceptable to the Administrative Agent, PROVIDED that (i) at the
time of any replacement pursuant to this Section 2.13, the Replacement Lender
shall enter into one or more Assignment Agreements pursuant to Section 12.04(b)
(and with all fees payable pursuant to said Section 12.04(b) to be paid by the
Replacement Lender) pursuant to which the Replacement Lender shall acquire the
entire Revolving Commitment and Term Commitment and outstanding Loans of, and in
each case participations in Letters of Credit by, the Replaced Lender and, in
connection therewith, shall pay to (x) the Replaced Lender in respect thereof an
amount equal to the sum of (I) an amount equal to the principal of, and all
accrued interest on, all outstanding Loans of the Replaced Lender, (II) an
amount equal to all Unpaid Drawings that have been funded by (and not reimbursed
to) such Replaced Lender,
-33-
<PAGE>
together with all then unpaid interest with respect thereto at such time and
(III) an amount equal to all accrued, but theretofore unpaid, Fees owing to the
Replaced Lender pursuant to Section 4.01 and (y) the Issuing Lender an amount
equal to such Replaced Lender's RL Percentage of any Unpaid Drawing (which at
such time remains an Unpaid Drawing) to the extent such amount was not
theretofore funded by such Replaced Lender to such Issuing Lender and (ii) all
obligations of the Borrower due and owing to the Replaced Lender at such time
(other than those specifically described in clause (i) above in respect of which
the assignment purchase price has been, or is concurrently being, paid) shall be
paid in full to such Replaced Lender concurrently with such replacement and any
Revolving Notes which have been issued shall be returned or indemnities will be
provided therefor. Upon the execution of the respective Assignment Agreement,
the payment of amounts referred to in clauses (i) and (ii) above and, if so
requested by the Replacement Lender, delivery to the Replacement Lender of the
appropriate Note or Notes executed by the Borrower, the Replacement Lender shall
become a Lender hereunder and the Replaced Lender shall cease to constitute a
Lender hereunder, except with respect to indemnification provisions under this
Agreement (including, without limitation, Sections 2.10, 2.11, 3.06, 5.04, 11.06
and 12.01), which shall survive as to such Replaced Lender.
2.14 ADDITIONAL REVOLVING COMMITMENTS. (a) So long as no
Default or Event of Default then exists or would result therefrom, the Borrower
shall have the right at any time and from time to time on or prior to November
9, 2002 and upon at least 15 Business Days prior written notice to the
Administrative Agent (which shall promptly notify each of the Lenders), to
request on up to three occasions that one or more Lenders (and/or one or more
other Persons which will become Lenders as provided below) provide Additional
Revolving Commitments and, subject to the applicable terms and conditions
contained in this Agreement, make Revolving Loans pursuant thereto; it being
understood and agreed, however, that (i) no Lender shall be obligated to provide
an Additional Revolving Commitment as a result of any such request by the
Borrower, (ii) until such time, if any, as such Lender has agreed in its sole
discretion to provide an Additional Revolving Commitment and executed and
delivered to the Administrative Agent an Additional Revolving Commitment
Agreement in respect thereof as provided in Section 2.14(b) and such Additional
Revolving Commitment Agreement has become effective, such Lender shall not be
obligated to fund any Revolving Loans in excess of its Revolving Commitment as
in effect prior to giving effect to such Additional Revolving Commitment
provided pursuant to this Section 2.14, (iii) any Lender (or, in the
circumstances contemplated by clause (vii) below, any other Person which will
qualify as an Eligible Transferee) may so provide an Additional Revolving
Commitment without the consent of any other Lender but with the prior consent of
the Agents (which consents shall not be unreasonably withheld), (iv) each
provision of Additional Revolving Commitments on a given date pursuant to this
Section 2.14 shall be in a minimum aggregate amount (for all Lenders (including,
in the circumstances contemplated by clause (vii) below, Eligible Transferees
who will become Lenders)) of at least $5,000,000 and in integral multiples of
$5,000,000 in excess thereof, (v) the aggregate amount of all Additional
Revolving Commitments permitted to be provided pursuant to this Section 2.14
shall not exceed $50,000,000, (vi) the fees payable to any Lender (including, in
the circumstances contemplated by clause (vii) below, any Eligible Transferee
who will become a Lender) providing an Additional Revolving Commitment shall be
as set forth in the relevant Additional Revolving Commitment Agreement, (vii)
if, after the Borrower has requested the then existing Lenders
-34-
<PAGE>
(other than Defaulting Lenders) to provide Additional Revolving Commitments
pursuant to this Section 2.14 on the terms to be applicable thereto, the
Borrower has not received Additional Revolving Commitments in an aggregate
amount equal to that amount of the Additional Revolving Commitments which the
Borrower desires to obtain pursuant to such request (as set forth in the notice
provided by the Borrower to the Administrative Agent as provided above), then
the Borrower may request Additional Revolving Commitments from one or more
Persons which would qualify as Eligible Transferees hereunder in an aggregate
amount equal to such deficiency on terms which are no more favorable to any such
Eligible Transferee in any respect than the terms offered to the then existing
Lenders, PROVIDED that any such Additional Revolving Commitments provided by any
such Eligible Transferee which is not already a Lender shall be in a minimum
amount (for such Eligible Transferee) of at least $5,000,000, and (viii) all
actions taken by the Borrower pursuant to this Section 2.14(a) shall be done in
coordination with the Administrative Agent.
(b) At the time of any provision of Additional Revolving
Commitments pursuant to this Section 2.14, (i) the Borrower, the Administrative
Agent and each Lender or other Eligible Transferee (each, an "Additional RL
Lender") which agrees to provide an Additional Revolving Commitment shall
execute and deliver to the Administrative Agent an Additional Revolving
Commitment Agreement substantially in the form of Exhibit P (appropriately
completed), subject to such modifications in form and substance reasonably
satisfactory to the Administrative Agent as may be necessary or appropriate
(with the effectiveness of such Additional RL Lender's Additional Revolving
Commitment to occur upon delivery of such Additional Revolving Commitment
Agreement to the Administrative Agent, the payment of any fees required in
connection therewith and the satisfaction of the other conditions in this
Section 2.14(b) to the reasonable satisfaction of the Administrative Agent),
(ii) the Borrower shall, in coordination with the Administrative Agent, repay
outstanding Revolving Loans of certain of the RL Lenders, and incur additional
Revolving Loans from certain other RL Lenders, in each case to the extent
necessary so that all of the RL Lenders participate in each outstanding
Borrowing of Revolving Loans PRO RATA on the basis of their respective Revolving
Commitments (after giving effect to any increase in the Total Revolving
Commitment pursuant to this Section 2.14) and with the Borrower being obligated
to pay to the respective RL Lenders the costs of the type referred to in Section
2.11 in connection with any such repayment and/or Borrowing, and (iii) the
Borrower shall deliver to the Administrative Agent an opinion, in form and
substance reasonably satisfactory to the Agents, from counsel to the Borrower
reasonably satisfactory to the Administrative Agent and dated such date,
covering such matters similar to those set forth in the opinions of counsel
delivered to the Administrative Agent on the Restatement Effective Date pursuant
to Section 6.01(b) and such other matters as the Agents may reasonably request.
The Administrative Agent shall promptly notify each Lender as to the occurrence
of each Additional Revolving Commitment Date, and (x) on each such date, the
Total Revolving Commitment under, and for all purposes of, this Agreement shall
be increased by the aggregate amount of such Additional Revolving Commitments,
and (y) on each such date Annex I shall be deemed modified to reflect the
revised Revolving Commitments of the affected Lenders.
-35-
<PAGE>
SECTION 3. LETTERS OF CREDIT.
3.01 LETTERS OF CREDIt. (a) Subject to and upon the terms and
conditions set forth herein, the Borrower may request that the Issuing Lender
issue, at any time and from time to time on and after the Restatement Effective
Date and prior to the 30th day prior to the Final Maturity Date, (x) for the
account of the Borrower and for the benefit of any holder (or any trustee, agent
or other similar representative for any such holders) of L/C Supportable
Obligations of the Borrower or any of its Subsidiaries, an irrevocable standby
letter of credit, in a form customarily used by the Issuing Lender or in such
other form as has been approved by the Issuing Lender (each such standby letter
of credit, a "Standby Letter of Credit"), in support of such L/C Supportable
Obligations and (y) for the account of the Borrower, an irrevocable sight
commercial letter of credit in a form customarily used by the Issuing Lender or
in such other form as has been approved by the Issuing Lender (each such
commercial letter of credit, a "Trade Letter of Credit," and each such Trade
Letter of Credit and each Standby Letter of Credit, a "Letter of Credit"), in
support of customary commercial transactions of the Borrower and its
Subsidiaries. All Letters of Credit shall be denominated in Dollars and shall be
issued on a sight basis only.
(b) Subject to and upon the terms and conditions set forth
herein, the Issuing Lender agrees that it will, at any time and from time to
time on and after the Restatement Effective Date and prior to the 30th day prior
to the Final Maturity Date, following its receipt of the respective Letter of
Credit Request, issue for the account of the Borrower, one or more Letters of
Credit (x) in the case of Standby Letters of Credit, in support of such L/C
Supportable Obligations of the Borrower or any of its Subsidiaries as are
permitted to remain outstanding without giving rise to a Default or an Event of
Default hereunder and (y) in the case of Trade Letters of Credit, in support of
customary commercial transactions of the Borrower or any of its Subsidiaries,
PROVIDED that the Issuing Lender shall be under no obligation to issue any
Letter of Credit of the types described above if at the time of such issuance:
(i) any order, judgment or decree of any governmental authority
or arbitrator shall purport by its terms to enjoin or restrain the
Issuing Lender from issuing such Letter of Credit or any requirement of
law applicable to the Issuing Lender or any request or directive
(whether or not having the force of law) from any governmental
authority with jurisdiction over the Issuing Lender shall prohibit, or
request that the Issuing Lender refrain from, the issuance of letters
of credit generally or such Letter of Credit in particular or shall
impose upon the Issuing Lender with respect to such Letter of Credit
any restriction or reserve or capital requirement (for which the
Issuing Lender is not otherwise compensated under Section 3.06 or
otherwise) not in effect on the date hereof, or any unreimbursed loss,
cost or expense which was not applicable or in effect with respect to
the Issuing Lender as of the date hereof and which the Issuing Lender
reasonably and in good faith deems material to it;
(ii) the Issuing Lender shall have received notice from the
Borrower, any other Credit Party or the Required Lenders prior to the
issuance of such Letter of Credit of the type described in the second
sentence of Section 3.03(b);
-36-
<PAGE>
(iii) a Lender Default exists, unless the Issuing Lender has
entered into arrangements satisfactory to it and the Borrower to
eliminate the Issuing Lender's risk with respect to the Defaulting
Lender's or Lenders' participations in Letters of Credit; or
(iv) the (A) Consolidated Senior Debt to Capitalization Ratio is
greater than 50% or (B) the Consolidated Senior Debt to Gross PP&E
Ratio is greater than 120%, in either case after giving effect to such
issuances of any Letters of Credit.
(c) Annex X contains a description of all letters of credit
issued by the Issuing Lender pursuant to the Existing Credit Agreement and which
are to remain outstanding on the Restatement Effective Date. Each such letter of
credit, including any extension thereof (each, an "Existing Letter of Credit")
shall constitute a "Letter of Credit" for all purposes of this Agreement. Each
Existing Letter of Credit shall be deemed issued for purposes of Sections
3.01(a), 3.01(b), 3.04(a), 4.01(b) and 4.01(c) on the Restatement Effective
Date.
3.02 MAXIMUM LETTER OF CREDIT OUTSTANDINGS; FINAL MATURITIES.
Notwithstanding anything to the contrary contained in this Agreement, (i) no
Letter of Credit shall be issued the Stated Amount of which, when added to the
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on
the date of, and prior to the issuance of, the respective Letter of Credit) at
such time would exceed either (x) $15,000,000 or (y) when added to the aggregate
principal amount of all Revolving Loans then outstanding, an amount equal to the
Total Revolving Commitment at such time and (ii) each Letter of Credit shall by
its terms terminate on or before the earlier of (x) (A) in the case of Standby
Letters of Credit, the date which occurs 12 months after the date of the
issuance thereof (although any such Standby Letter of Credit may be extendible
for successive periods of up to 12 months, but not beyond the third Business Day
prior to the Final Maturity Date, on terms acceptable to the Issuing Lender) and
(B) in the case of Trade Letters of Credit, the date which occurs 180 days after
the date of issuance thereof or (y) three Business Days prior to the Final
Maturity Date.
3.03 LETTER OF CREDIT REQUESTS; MINIMUM STATED AMOUNT. (a)
Whenever the Borrower desires that a Letter of Credit be issued for its account,
the Borrower shall give the Administrative Agent and the Issuing Lender at least
three Business Days' (or such shorter period as is acceptable to the Issuing
Lender) written notice thereof. Each notice shall be in the form of Exhibit C
appropriately completed (each a "Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be
deemed to be a representation and warranty by the Borrower that such Letter of
Credit may be issued in accordance with, and will not violate the requirements
of, Section 3.02. Unless the Issuing Lender has received notice from the
Borrower, any other Credit Party or the Required Lenders before it issues a
Letter of Credit that one or more of the conditions specified in Section 6.02
(and, if such Letter of Credit is the first extension of credit under this
Agreement, Section 6.01) are not then satisfied, or that the issuance of such
Letter of Credit would violate Section 3.02, then the Issuing Lender may,
subject to the terms and conditions of this Agreement, issue the requested
Letter of Credit for the account of the Borrower in accordance with the Issuing
Lender's usual and customary practices. Upon its issuance of or amendment or
modification to any Standby Letter of Credit, the Issuing Lender shall promptly
notify the Borrower and the Administrative Agent of
-37-
<PAGE>
such issuance, amendment or modification and such notification shall be
accompanied by a copy of the issued Letter of Credit or amendment or
modification.
(c) The initial Stated Amount of each Letter of Credit shall
not be less than $100,000 or such lesser amount as is reasonably acceptable to
the Issuing Lender.
3.04 LETTER OF CREDIT PARTICIPATIONS. (a) Immediately upon the
issuance by the Issuing Lender of any Letter of Credit, the Issuing Lender shall
be deemed to have sold and transferred to each RL Lender, other than the Issuing
Lender (each such RL Lender, in its capacity under this Section 3.04, a
"Participant"), and each such Participant shall be deemed irrevocably and
unconditionally to have purchased and received from the Issuing Lender, without
recourse or warranty, an undivided interest and participation, to the extent of
such Participant's RL Percentage, in such Letter of Credit, each drawing or
payment made thereunder and the obligations of the Borrower under this Agreement
with respect thereto, and any security therefor or guaranty pertaining thereto.
Upon any change in the Revolving Commitments or RL Percentages of the Lenders
pursuant to Section 2.13 or 12.04, it is hereby agreed that, with respect to all
outstanding Letters of Credit and Unpaid Drawings, there shall be an automatic
adjustment to the participations pursuant to this Section 3.04 to reflect the
new RL Percentages of the assignor and assignee RL Lender, as the case may be.
(b) In determining whether to pay under any Letter of Credit,
the Issuing Lender shall not have an obligation relative to the other Lenders
other than to confirm that any documents required to be delivered under such
Letter of Credit appear to have been delivered and that they appear to
substantially comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by the Issuing Lender under or
in connection with any Letter of Credit if taken or omitted in the absence of
gross negligence or willful misconduct (as finally determined by a court of
competent jurisdiction), shall not create for the Issuing Lender any resulting
liability to the Borrower, any other Credit Party, any Lender or any other
Person.
(c) In the event that the Issuing Lender makes any payment
under any Letter of Credit and the Borrower shall not have reimbursed such
amount in full to the Issuing Lender pursuant to Section 3.05(a), the Issuing
Lender shall promptly notify the Administrative Agent, which shall promptly
notify each Participant of such failure, and each Participant shall promptly and
unconditionally pay to the Issuing Lender the amount of such Participant's RL
Percentage of such unreimbursed payment in Dollars and in same day funds. If the
Administrative Agent so notifies, prior to 11:00 A.M. (New York time) on any
Business Day, any Participant required to fund a payment under a Letter of
Credit, such Participant shall make available to the Issuing Lender in Dollars
such Participant's RL Percentage of the amount of such payment on such Business
Day in same day funds. If and to the extent such Participant shall not have so
made its RL Percentage of the amount of such payment available to the Issuing
Lender, such Participant agrees to pay to the Issuing Lender, forthwith on
demand such amount, together with interest thereon, for each day from such date
until the date such amount is paid to the Issuing Lender at the overnight
Federal Funds Rate for the first three days and at the interest rate applicable
to Revolving Loans maintained as Base Rate Loans for each day thereafter. The
failure of any Participant to make available to the Issuing Lender its RL
Percentage of any payment under any Letter of Credit shall not relieve any other
Participant of its obligation hereunder to make available to the Issuing Lender
its RL Percentage of any
-38-
<PAGE>
Letter of Credit on the date required, as specified above, but no Participant
shall be responsible for the failure of any other Participant to make available
to the Issuing Lender such other Participant's RL Percentage of any such
payment.
(d) Whenever the Issuing Lender receives a payment of a
reimbursement obligation as to which it has received any payments from the
Participants pursuant to clause (c) above, the Issuing Lender shall pay to each
Participant which has paid its RL Percentage thereof, in Dollars and in same day
funds, an amount equal to such Participant's share (based upon the proportionate
aggregate amount originally funded by such Participant to the aggregate amount
funded by all Participants) of the principal amount of such reimbursement
obligation and interest thereon accruing after the purchase of the respective
participations.
(e) Upon the request of any Participant, the Issuing Lender
shall furnish to such Participant copies of any Letter of Credit issued by it
and such other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants to make payments to
the Issuing Lender with respect to Letters of Credit issued by it shall be
irrevocable and not subject to any qualification or exception whatsoever and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any of its Subsidiaries may have at any
time against a beneficiary named in a Letter of Credit, any transferee
of any Letter of Credit (or any Person for whom any such transferee may
be acting), the Administrative Agent, any Participant, or any other
Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between the Borrower
or any Subsidiary of the Borrower and the beneficiary named in any such
Letter of Credit);
(iii) any draft, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
3.05 AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. (a) The
Borrower agrees to reimburse the Issuing Lender, by making payment to the
Administrative Agent in immediately
-39-
<PAGE>
available funds at the Payment Office, for any payment or disbursement made by
the Issuing Lender under any Letter of Credit (each such amount, so paid until
reimbursed, an "Unpaid Drawing"), not later than one Business Day following
receipt by the Borrower of notice of such payment or disbursement (provided that
no such notice shall be required to be given if a Default or an Event of Default
under Section 10.05 shall have occurred and be continuing, in which case the
Unpaid Drawing shall be due and payable immediately without presentment, demand,
protest or notice of any kind (all of which are hereby waived by the Borrower)),
with interest on the amount so paid or disbursed by the Issuing Lender, to the
extent not reimbursed prior to 1:00 P.M. (New York time) on the date of such
payment or disbursement (or to the extent such Unpaid Drawing is repaid with a
Borrowing of Revolving Loans constituting Base Rate Loans pursuant to clause
(ii) of the proviso below), from and including the date paid or disbursed to but
excluding the date the Issuing Lender was reimbursed by the Borrower therefor at
a rate per annum which shall be the Base Rate in effect from time to time plus
the Applicable Margin for Base Rate Loans; PROVIDED, HOWEVER, (i) to the extent
such amounts are not reimbursed prior to 1:00 P.M. (New York time) on the third
Business Day following the receipt by the Borrower of notice of such payment or
disbursement or following the occurrence of a Default or an Event of Default
under Section 10.05, interest shall thereafter accrue on the amounts so paid or
disbursed by the Issuing Lender (and until reimbursed by the Borrower) at a rate
per annum which shall be the Base Rate in effect from time to time plus the
Applicable Margin for Base Rate Loans plus 2%, in each such case, with interest
to be payable on demand and (ii) (x) unless the Borrower shall have notified the
Administrative Agent and the Issuing Lender prior to 1:00 P.M. (New York time)
on the date of such payment or disbursement that the Borrower intends to
reimburse the Issuing Lender for the amount of such Drawing with funds other
than the proceeds of Revolving Loans, then so long as all of the conditions
precedent set forth in Section 6.01 or 6.02(b), as the case may be, are
satisfied, the Borrower shall be deemed to have given a timely Notice of
Borrowing to the Administrative Agent for a Borrowing of Revolving Loans
constituting Base Rate Loans to be made on the immediately succeeding Business
Day in the amount of such Drawing and (y) so long as all of the conditions
precedent set forth in Section 6.01 or 6.02(b), as the case may be, are
satisfied, each RL Lender shall, in accordance with Section 2.04, make available
to the Administrative Agent its PRO RATA portion of such Borrowing on such
immediately succeeding Business Day (and with the proceeds thereof to be applied
directly by the Administrative Agent to reimburse the Issuing Lender for the
amount of such Drawing), PROVIDED FURTHER, HOWEVER, that if for any reason
proceeds of Revolving Loans are not so received by the Issuing Lender in an
amount equal to such Drawing, the Borrower shall reimburse the Issuing Lender,
on demand, in an amount equal to the excess of the amount of such Drawing over
the aggregate amount of such Revolving Loans, if any, which are so received.
(b) The obligations of the Borrower under this Section 3.05 to
reimburse the Issuing Lender with respect to Unpaid Drawings (including, in each
case, interest thereon) shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which the Borrower may have or have had against any Lender (including in its
capacity as issuer of the Letter of Credit or as Participant), including,
without limitation, any defense based upon the failure of any drawing under a
Letter of Credit (each a "Drawing") to conform to the terms of the Letter of
Credit or any nonapplication or misapplication by the beneficiary of the
proceeds of such Drawing; PROVIDED, HOWEVER, that the
-40-
<PAGE>
Borrower shall not be obligated to reimburse the Issuing Lender for any wrongful
payment made by the Issuing Lender under a Letter of Credit as a result of acts
or omissions constituting willful misconduct or gross negligence on the part of
the Issuing Lender (as finally determined by a court of competent jurisdiction).
3.06 INCREASED COSTS. If at any time after the date of this
Agreement, the introduction of or any change in any applicable law, rule,
regulation, order, guideline or request or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by the Issuing Lender or
any Participant with any request or directive by any such authority (whether or
not having the force of law), shall either (i) impose, modify or make applicable
any reserve, deposit, capital adequacy or similar requirement against letters of
credit issued by the Issuing Lender or participated in by any Participant, or
(ii) impose on the Issuing Lender or any Participant any other conditions
relating, directly or indirectly, to this Agreement; and the result of any of
the foregoing is to increase the cost to the Issuing Lender or any Participant
of issuing, maintaining or participating in any Letter of Credit, or reduce the
amount of any sum received or receivable by the Issuing Lender or any
Participant hereunder or reduce the rate of return on its capital with respect
to Letters of Credit (except for changes in the rate of tax on, or determined by
reference to, the net income or profits of the Issuing Lender or such
Participant pursuant to the laws of the jurisdiction in which it is organized or
in which its principal office or applicable lending office is located or any
subdivision thereof or therein), then, within 30 days after the delivery of the
certificate referred to below to the Borrower by the Issuing Lender or any
Participant (a copy of which certificate shall be sent by the Issuing Lender or
such Participant to the Administrative Agent), the Borrower shall pay to the
Issuing Lender or such Participant such additional amount or amounts as will
compensate such Lender for such increased cost or reduction in the amount
receivable or reduction on the rate of return on its capital. The Issuing Lender
or any Participant, upon determining that any additional amounts will be payable
pursuant to this Section 3.06, will give prompt written notice thereof to the
Borrower, which notice shall include a certificate submitted to the Borrower by
the Issuing Lender or such Participant (a copy of which certificate shall be
sent by the Issuing Lender or such Participant to the Administrative Agent),
setting forth in reasonable detail the basis for the calculation of such
additional amount or amounts necessary to compensate the Issuing Lender or such
Participant. The certificate required to be delivered pursuant to this Section
3.06 shall, absent manifest error, be final and conclusive and binding on the
Borrower.
SECTION 4. COMMITMENT COMMISSION; FEES; REDUCTIONS OF
COMMITMENT.
4.01 FEES. (a) The Borrower agrees to pay to the
Administrative Agent a commitment commission (the "Commitment Commission") for
the account of each Lender that is a Non-Defaulting Lender for the period from
and including the Restatement Effective Date to but not including the date upon
which the Total Commitment has been terminated, computed for each day at the
rate per annum equal to the Applicable CC Percentage for such day on the
Aggregate Unutilized Commitment on such day of such Lender. Such Commitment
Commission shall be due and payable in arrears on the last Business Day of each
calendar quarter and on the date upon which the Total Commitment is terminated.
-41-
<PAGE>
(b) The Borrower agrees to pay to the Administrative Agent for
distribution to each Non-Defaulting Lender which is a RL Lender (based on each
such RL Lender's respective RL Percentage) a fee (the "Letter of Credit Fee")
for the period from and including the date of issuance of such Letter of Credit
to and including the date of termination or expiration of such Letter of Credit,
computed at a rate per annum equal to the Applicable Margin then in effect with
respect to Revolving Loans maintained as Eurodollar Loans on the daily Stated
Amount of each such Letter of Credit. Accrued Letter of Credit Fees shall be due
and payable quarterly in arrears on the last Business Day of each calendar
quarter and on the first day after the termination of the Total Revolving
Commitment upon which no Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to the Issuing Lender, for its
own account, a fronting fee in respect of each Letter of Credit (the "Fronting
Fee") for the period from and including the date of issuance of such Letter of
Credit to and including the date of termination or expiration of such Letter of
Credit, computed at a rate per annum equal to 1/4 of 1% on the daily Stated
Amount of such Letter of Credit. Accrued Fronting Fees shall be payable in
arrears on the last Business Day of each calendar quarter and upon the first day
after the termination of the Total Revolving Commitment upon which no Letters of
Credit remain outstanding.
(d) The Borrower agrees to pay to the Issuing Lender, for its
own account, upon each payment under, issuance of, or amendment to, any Letter
of Credit, such amount as shall at the time of such event be the administrative
nominal charge which the Issuing Lender is generally imposing in connection with
such occurrence with respect to letters of credit.
(e) The Borrower agrees to pay to each Agent, for its own
account, such other fees as have been agreed to in writing by the Borrower and
such Agent.
(f) The Borrower agrees to pay on the Restatement Effective
Date all fees (including commitment fees) owing under the Existing Credit
Agreement through the Restatement Effective Date, which fees shall be calculated
and paid in accordance with the terms of the Existing Credit Agreement.
(g) All computations of Fees shall be made in accordance with
Section 12.07(b).
4.02 VOLUNTARY TERMINATION OF COMMITMENTS. (a) Upon at least
one Business Day's prior written notice (or telephonic notice confirmed in
writing) to the Administrative Agent at its Notice Office (which notice shall be
deemed to be given on a certain day only if given before 10:00 A.M. (New York
time) on such day and shall be promptly transmitted by the Administrative Agent
to each of the Lenders), the Borrower shall have the right, without premium or
penalty, to reduce, in whole or in part, the Total Unutilized Revolving
Commitment, PROVIDED that (x) any such partial reduction shall apply to
proportionately and permanently reduce the Revolving Commitment of each Lender,
(y) no such reduction shall reduce any Non-Defaulting Lender's Revolving
Commitment in an amount greater than the then Unutilized Revolving Commitment of
such Lender and (z) any partial reduction pursuant to this Section 4.02(a) shall
be in the amount of at least $500,000.
-42-
<PAGE>
(b) Upon at least one Business Day's prior written notice (or
telephonic notice confirmed in writing) to the Administrative Agent at its
Notice Office (which notice shall be deemed to be given on a certain day only if
given before 10:00 A.M. (New York time) on such day and shall be promptly
transmitted by the Administrative Agent to each of the Lenders), the Borrower
shall have the right, without premium or penalty, to reduce, in whole or in
part, the Total Term Commitment, PROVIDED that (x) any such partial reduction
shall apply to proportionately and permanently reduce the Term Commitment of
each Lender and (y) any partial reduction pursuant to this Section 4.02(b) shall
be in the amount of at least $500,000.
(c) In the event of a refusal by a Lender to consent to
certain proposed changes, waivers, discharges or terminations with respect to
this Agreement which have been approved by the Required Lenders as (and to the
extent) provided in Section 12.12(b), the Borrower may, subject to its
compliance with the requirements of Section 12.12(b), upon five Business Days'
prior written notice to the Administrative Agent at the Notice Office (which
notice the Administrative Agent shall promptly transmit to each of the Lenders)
terminate the entire Revolving Commitment and Term Commitment of such Lender, so
long as (A) all Loans, together with accrued and unpaid interest, Fees and all
other amounts, owing to such Lender are repaid concurrently with the
effectiveness of such termination pursuant to Section 5.01(b) (at which time
Schedule I shall be deemed modified to reflect such changed amounts), and (B)
the consent required under Section 12.12(b) in connection therewith shall have
been attained at such time, and such Lender shall no longer constitute a
"Lender" for purposes of this Agreement, except with respect to indemnifications
under this Agreement (including, without limitation, Sections 2.10, 2.11, 3.06,
5.04, 11.06 and 12.01), which shall survive as to such repaid Lender.
4.03 MANDATORY REDUCTIONS OF COMMITMENTS, ETC. (a) In addition
to any other mandatory commitment reductions pursuant to this Section 4.03, the
Total Term Commitment (i) shall be permanently reduced on each Term Loan
Borrowing Date (after giving effect to the incurrence of Term Loans on each such
date) in an amount equal to the aggregate principal amount of Term Loans
incurred on each such date, (ii) shall be permanently reduced from time to time
in accordance with Section 5.02(h) and (iii) shall terminate in its entirety (to
the extent not theretofore terminated) on the earlier of (x) the Term Loan
Commitment Termination Date or (y) unless the Required Lenders otherwise
consent, the date on which a Change of Control occurs.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 4.03, the Total Revolving Commitment shall be
permanently reduced on each date set forth below in an amount equal to the
product of (I) the Total Revolving Commitment on November 9, 2002 (after giving
effect to any increase thereto on such date pursuant to Section 2.14) and (II)
the respective percentage set forth opposite each such date below:
DATE PERCENTAGE
------ ------------------
November 9, 2004 10%
November 9, 2005 25%
November 9, 2006 40%
-43-
<PAGE>
(c) In addition to any other mandatory commitment reductions
pursuant to this Section 4.03, the Total Revolving Commitment shall be
permanently reduced from time to time in accordance with Section 5.02(h).
(d) In addition to any other mandatory commitment reductions
pursuant to this Section 4.03, the Total Revolving Commitment shall terminate in
its entirety on the earlier of (i) the Final Maturity Date or (ii) unless the
Required Lenders otherwise consent, the date on which a Change of Control
occurs.
(e) Each reduction to, or termination of, the Total Term
Commitment and the Total Revolving Commitment pursuant to this Section 4.03
shall be applied proportionately to permanently reduce or terminate, as the case
may be, the Term Commitment and the Revolving Commitment, as the case may be, of
each Lender with such a Commitment.
SECTION 5. PAYMENTS.
5.01 VOLUNTARY PREPAYMENTS. (a) The Borrower shall have the
right to prepay the Loans, without premium or penalty, in whole or in part at
any time and from time to time on the following terms and conditions: (i) the
Borrower shall give the Administrative Agent prior to 1:00 P.M. (New York time)
at the Notice Office (x) at least one Business Day's prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to prepay Base
Rate Loans and (y) at least three Business Days' prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to prepay
Eurodollar Loans, the amount of such prepayment, whether Term Loans or Revolving
Loans are to be prepaid, the Types of Loans to be prepaid and, in the case of
Eurodollar Loans, the specific Borrowing or Borrowings pursuant to which such
Loans were made, which notice the Administrative Agent shall promptly transmit
to each of the Lenders; (ii) each partial prepayment of any Tranche of Loans
pursuant to this Section 5.01(a) shall be in an aggregate principal amount of at
least $2,500,000, PROVIDED that if any partial prepayment of Eurodollar Loans
made pursuant to any Borrowing shall reduce the outstanding principal amount of
Eurodollar Loans made pursuant to such Borrowing to an amount less than the
Minimum Borrowing Amount applicable thereto, then such Borrowing may not be
continued as a Borrowing of Eurodollar Loans and any election of an Interest
Period with respect thereto given by the Borrower shall have no force or effect;
(iii) each prepayment pursuant to this Section 5.01(a) in respect of any Loans
made pursuant to a Borrowing shall be applied PRO RATA among the Lenders which
made such Loans, provided that at the Borrower's election in connection with any
prepayment of Loans pursuant to this Section 5.01(a), such prepayment shall not,
so long as no Default or Event of Default then exists, be applied to any Loan of
a Defaulting Lender; (iv) each prepayment of Term Loans pursuant to this Section
5.01(a) shall be applied to reduce the then remaining Scheduled Term Loan
Repayments on a PRO RATA basis (based upon the then remaining unpaid principal
amounts of such Scheduled Term Loan Repayments after giving effect to all prior
reductions thereto); and (v) in the case of prepayment of Borrowings maintained
as Eurodollar Loans, the Borrower shall reimburse, at the Borrower's sole cost
-44-
<PAGE>
and expense, each Lender's reasonable breakage and redeployment costs, other
than on the last day of an Interest Period applicable thereto.
(b) In the event of a refusal by a Lender to consent to
certain proposed changes, waivers, discharges or terminations with respect to
this Agreement which have been approved by the Required Lenders as (and to the
extent) provided in Section 12.12(b), the Borrower may, upon five Business Days'
prior written notice to the Administrative Agent at the Notice Office (which
notice the Administrative Agent shall promptly transmit to each of the Lenders)
repay all Loans of, together with accrued and unpaid interest, Fees and other
amounts owing to, such Lender in accordance with, and subject to the
requirements of, said Section 12.12(b) so long as (A) the entire Revolving
Commitment and Term Commitment, if any, of such Lender is terminated
concurrently with such repayment pursuant to Section 4.02(c) (at which time
Schedule I shall be deemed modified to reflect the changed Revolving Commitments
and Term Commitments) and (B) the consents required under Section 12.12(b) in
connection therewith have been obtained.
5.02 MANDATORY REPAYMENTS. (a) (i) On any day on which the sum
of the aggregate outstanding principal amount of the Revolving Loans and the
Letter of Credit Outstandings exceeds the Total Revolving Commitment as then in
effect, the Borrower shall prepay on such day Revolving Loans in an amount equal
to such excess. If, after giving effect to the prepayment of all outstanding
Revolving Loans, the aggregate amount of the Letter of Credit Outstandings
exceeds the Total Revolving Commitment as then in effect, the Borrower shall pay
to the Administrative Agent at the Payment Office on such day an amount of cash
and/or Cash Equivalents equal to the amount of such excess (up to a maximum
amount equal to the Letter of Credit Outstandings at such time), such cash
and/or Cash Equivalents to be held as security for all Obligations of the
Borrower to the Issuing Lender and the Lenders hereunder in a cash collateral
account to be established by the Administrative Agent.
(ii) If on any date the aggregate outstanding principal amount
of the Revolving Loans made by a Defaulting Lender exceeds the Revolving
Commitment of such Defaulting Lender, the Borrower shall repay principal of
Revolving Loans of such Defaulting Lender in an amount equal to such excess.
(b) In addition to any other mandatory repayments pursuant to
this Section 5.02, on each date set forth below, the Borrower shall be required
to repay that principal amount of Term Loans as is equal to the product of (I)
the aggregate principal amount of all Term Loans outstanding on the Term Loan
Commitment Termination Date (after giving effect to any Term Loans incurred on
such date) and (II) the respective percentage set forth opposite each such date
below (each such repayment, as the same may be reduced as provided in Sections
5.01(a) and 5.02(h), a "Scheduled Term Loan Repayment"):
SCHEDULED TERM LOAN
REPAYMENT DATE PERCENTAGE
-------------- ----------
January 31, 2004 2.5%
-45-
<PAGE>
April 30, 2004 2.5%
July 31, 2004 2.5%
October 31, 2004 2.5%
January 31, 2005 6.25%
April 30, 2005 6.25%
July 31, 2005 6.25%
October 31, 2005 6.25%
January 31, 2006 10%
April 30, 2006 10%
July 31, 2006 10%
October 31, 2006 10%
January 31, 2007 6.25%
April 30, 2007 6.25%
July 31, 2007 6.25%
Final Maturity Date 6.25%
(c) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 5.02, on each date on or after
the Restatement Effective Date upon which the Borrower or any of its
Subsidiaries receives any cash proceeds from any incurrence by the Borrower or
any of its Subsidiaries of Indebtedness for borrowed money (other than
Indebtedness for borrowed money permitted to be incurred pursuant to Section
9.04 as such Section is in effect on the Restatement Effective Date), an amount
equal to 100% of the Net Debt Proceeds of the respective incurrence of
Indebtedness shall be applied on each such date as a mandatory repayment and/or
commitment reduction in accordance with the provisions of Sections 5.02(h) and
(i); PROVIDED that, notwithstanding the foregoing, 100% of the Net Debt Proceeds
in excess of $200,000,000 received during Phase I from the issuance of Permitted
Subordinated Debt shall be applied on each such date in accordance with the
provisions of Sections 5.02(h) and (i).
(d) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 5.02, within two Business Days
after each date on or after the Restatement Effective Date upon which the
Borrower or any of its Subsidiaries receives any cash proceeds from any Asset
Sale (including any sale by the Borrower or its Subsidiaries of capital stock of
any of the Subsidiaries of the Borrower), an amount equal to 100% of the Net
Cash Proceeds from such Asset Sale shall be applied on each such date as a
mandatory repayment and/or commitment reduction in accordance with the
provisions of Sections 5.02(h) and (i); PROVIDED that with respect to any such
Asset Sales in any fiscal year of the Borrower, such Net Cash Proceeds therefrom
shall not give rise to a mandatory repayment and/or commitment reduction
pursuant to this Section 5.02(d) on such date to the extent that no Default or
Event of Default then exists and the Borrower has delivered a certificate to the
Administrative Agent on or prior to such date stating that such Net Cash
Proceeds shall be used to purchase assets that replace the assets that were the
subject of such Asset Sale or assets that will be used in the business of the
Borrower or its Subsidiaries (collectively, "Replacement Assets") within 364
days following the date of such Asset Sale (which certificate shall set forth
the estimates of the proceeds to be so expended), and PROVIDED FURTHER, that if
all or any portion of such Net Cash Proceeds are not so reinvested in
Replacement Assets within such 364 day period, such
-46-
<PAGE>
remaining portion shall be applied in accordance with the provisions of Sections
5.02(h) and (i) on the last day of such period (or such earlier date as may be
designated by the Borrower).
(e) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 5.02, within 10 days following
each date on or after the Restatement Effective Date upon which the Borrower or
any of its Subsidiaries receives any cash proceeds from any Recovery Event, an
amount equal to 100% of the Net Insurance Proceeds from such Recovery Event
shall be applied on each such date as a mandatory repayment and/or commitment
reduction in accordance with the provisions of Sections 5.02(h) and (i);
PROVIDED that so long as no Default or Event of Default then exists, such Net
Insurance Proceeds shall not be required to be so applied on such date to the
extent that the Borrower has delivered a certificate to the Administrative Agent
on or prior to such date stating that such Net Insurance Proceeds shall be used
to replace or restore any properties or assets in respect of which such Net
Insurance Proceeds were paid within 180 days following the date of the receipt
of such Net Insurance Proceeds (which certificate shall set forth the estimates
of the proceeds to be so expended); and PROVIDED FURTHER, that if all or any
portion of such Net Insurance Proceeds are not so used within 180 days after the
date of the receipt of such Net Insurance Proceeds, such remaining portion shall
be applied in accordance with the provisions of Sections 5.02(h) and (i) on the
last day of such period (or such earlier date as may be designated by the
Borrower).
(f) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 5.02, 50% of Consolidated Cash
Equity in excess of $1,000,000 received by the Borrower or any of its
Subsidiaries (other than any Consolidated Cash Equity received by the Borrower
from Parent, so long as the proceeds thereof are not used for the payment of
Dividends) on each date on or after the Restatement Effective Date shall be
applied on each such date as a mandatory repayment and/or commitment reduction
in accordance with the provisions of Sections 5.02(h) and (i).
(g) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 5.02, on each Excess Cash Payment
Date, an amount equal to 50% of the Excess Cash Flow for the relevant Excess
Cash Payment Period shall be applied as a mandatory repayment and/or commitment
reduction in accordance with the requirements of Sections 5.02(h) and (i).
(h) Each amount required to be applied pursuant to Sections
5.02(c) through (g), inclusive, in accordance with the requirements of this
Section 5.02(h), shall be applied (i) first, as a mandatory repayment of
outstanding Term Loans, (ii) second, to the extent in excess of the amounts
required to be applied pursuant to preceding clause (i), to permanently reduce
the Total Term Commitment and (iii) third, to the extent in excess of the
amounts required to be applied pursuant to preceding clauses (i) and (ii), to
permanently reduce the Total Revolving Commitment; PROVIDED that,
notwithstanding the foregoing, the Net Debt Proceeds from the issuance of
Permitted Subordinated Debt shall not be required to reduce the Total Revolving
Commitment. The amount of each principal repayment of outstanding Term Loans
made as required by this Section 5.02(h) shall be applied to reduce the then
remaining Scheduled Term Loan Repayments on a PRO RATA basis (based upon the
then remaining unpaid principal amounts of such Scheduled Term Loan Repayments
after giving effect to all prior reductions thereto).
-47-
<PAGE>
(i) With respect to each repayment of Loans required by this
Section 5.02 (including repayments resulting from the reduction of the Total
Revolving Commitment pursuant to Section 4.03(c)), the Borrower may designate
the Types of Loans of the respective Tranche which are to be repaid and, in the
case of Eurodollar Loans, the specific Borrowing or Borrowings pursuant to which
made, PROVIDED that: (i) repayments of Eurodollar Loans pursuant to this Section
5.02 may only be made on the last day of an Interest Period applicable thereto
unless all Eurodollar Loans with Interest Periods ending on such date of
required repayment and all Base Rate Loans have been paid in full; (ii) if any
repayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce
the outstanding Eurodollar Loans made pursuant to such Borrowing to an amount
less than the Minimum Borrowing Amount applicable thereto, such Borrowing shall
be converted at the end of the then current Interest Period into a Borrowing of
Base Rate Loans; and (iii) each repayment of any Tranche of Loans made pursuant
to a Borrowing shall be applied PRO RATA among the Lenders which made such
Loans. In the absence of a designation by the Borrower as described in the
preceding sentence, the Administrative Agent shall, subject to the above, make
such designation in its sole discretion.
(j) Notwithstanding anything to the contrary contained in this
Agreement or in any other Credit Document, (i) except as provided in clause (k)
below, all then outstanding Loans shall be repaid in full on the Final Maturity
Date and (ii) all then outstanding Loans shall be repaid in full on the date on
which a Change of Control occurs (unless the Required Lenders otherwise agree in
writing).
(k) Subject to Section 2.13, (i) upon the occurrence of the
Final Maturity Date and the failure of such Lender (or the Administrative Agent
on its behalf) to have received on such date payment in full of the Loans (and
interest and Fees thereon) outstanding on such date, (ii) after the occurrence
and during the continuance of an Event of Default under Section 10.01, 10.05 or
10.11 or (iii) after the occurrence and during the continuance of any Event of
Default that occurs due to noncompliance with Sections 9.11 through 9.17 and
such Event of Default (including if such Event of Default is a Specified Event
of Default under and defined in the Amended and Restated Preferred Stock
Issuance and Capital Contribution Agreement) shall continue for a period of 30
or more Business Days after notice thereof from the Borrower (each a "Trigger
Event"), each Lender shall have the option, at its sole discretion, in
accordance with the Amended and Restated Preferred Stock Issuance and Capital
Contribution Agreement to convert (the "Conversion Option") all or a portion of
such Lender's outstanding Loans (and accrued and unpaid interest and Fees
thereon) into Parent Preferred Stock having a liquidation preference equal to
the aggregate principal amount of such Loans (and interest and Fees thereon
accrued and unpaid to the date of conversion). The provisions of this Section
5.02(k), and the ability of each Lender to exercise its Conversion Option, shall
cease upon the occurrence of the Conversion Option Termination Date.
(l) To the extent Parent makes a Parent Investment under and
as defined in the Amended and Restated Preferred Stock Issuance and Capital
Contribution Agreement, the Borrower agrees to issue and sell its common stock
to Parent at a price per share to be determined in good faith by the Borrower
and Parent, for an aggregate cash purchase price equal to the Capital
Contribution Amount (as defined in the Amended and Restated Preferred Stock
Issuance and Capital Contribution Agreement). The Borrower also agrees to
deliver to Parent on
-48-
<PAGE>
the Notice Date (as defined in the Amended and Restated Preferred Stock Issuance
and Capital Contribution Agreement), an Officer's Certificate (with a copy to
the Administrative Agent) setting forth the calculations of the Capital
Contribution Amount (as defined in the Amended and Restated Preferred Stock
Issuance and Capital Contribution Agreement) pursuant to Section 2.1 of the
Amended and Restated Preferred Stock Issuance and Capital Contribution Agreement
(the "Conversion/Contribution Certificate"), which calculations shall be in
substantially similar detail as in a Compliance Certificate, and, if applicable,
setting forth the Capital Contribution Amount that may be made by Parent
pursuant to the terms of Section 2 of the Amended and Restated Preferred Stock
Issuance and Capital Contribution Agreement in order to cure any Specified
Events of Default thereunder.
5.03 METHOD AND PLACE OF PAYMENT. Except as otherwise
specifically provided herein, all payments under this Agreement and/or under any
Note shall be made to the Administrative Agent for the ratable account of the
Lenders entitled thereto, not later than 1:00 P.M. (New York time) on the date
when due and shall be made in immediately available funds and in Dollars at the
Payment Office, it being understood that written notice by the Borrower to the
Administrative Agent to make a payment from the funds in the Borrower's account
at the Payment Office shall constitute the making of such payment to the extent
of such funds held in such account. Any payments under this Agreement which are
made later than 1:00 P.M. (New York time) on any day shall be deemed to have
been made on the next succeeding Business Day. Whenever any payment to be made
hereunder shall be stated to be due on a day which is not a Business Day, the
due date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable during such
extension at the applicable rate in effect immediately prior to such extension.
5.04 NET PAYMENTS. (a) All payments made by the Borrower
hereunder and/or under any Note will be made without setoff, counterclaim or
other defense. Except as provided in Section 5.04(b), all such payments will be
made free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by any jurisdiction or by any political
subdivision or taxing authority thereof or therein with respect to such payments
(but excluding, except as provided in the second succeeding sentence, any tax
imposed on or measured by the net income or net profits of a Lender pursuant to
the laws of the jurisdiction in which it is organized or the jurisdiction in
which the principal office or applicable lending office of such Lender is
located or any subdivision thereof or therein) and all interest, penalties or
similar liabilities with respect to such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively as "Taxes"). If any Taxes are so levied or imposed, the Borrower
agrees to pay the full amount of such Taxes, and such additional amounts as may
be necessary so that every payment of all amounts due under this Agreement
and/or under any Note, after withholding or deduction for or on account of any
Taxes, will not be less than the amount provided for herein or therein. If any
amounts are payable in respect of Taxes pursuant to the preceding sentence, the
Borrower agrees to reimburse each Lender, upon the written request of such
Lender, for taxes imposed on or measured by the net income or net profits of
such Lender pursuant to the laws of the jurisdiction in which such Lender is
organized or in which the principal office or applicable lending office of such
Lender is located or under the laws of any political subdivision or taxing
-49-
<PAGE>
authority of any such jurisdiction in which such Lender is organized or in which
the principal office or applicable lending office of such Lender is located and
for any withholding of taxes as such Lender shall determine are payable by, or
withheld from, such Lender, in respect of such amounts so paid to or on behalf
of such Lender pursuant to the preceding sentence and in respect of any amounts
paid to or on behalf of such Lender pursuant to this sentence. The Borrower will
furnish to the Administrative Agent within 45 days after the date the payment of
any Taxes is due pursuant to applicable law certified copies of tax receipts
evidencing such payment by the Borrower. The Borrower agrees to indemnify and
hold harmless each Lender, and reimburse such Lender upon its written request,
for the amount of any Taxes so levied or imposed and paid by such Lender.
(b) Each Lender that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax
purposes agrees to deliver to the Borrower and the Administrative Agent on or
prior to the Restatement Effective Date, or in the case of a Lender that is an
assignee or transferee of an interest under this Agreement pursuant to Section
2.13 or 12.04 (unless the respective Lender was already a Lender hereunder
immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Lender, (i) two accurate and complete original
signed copies of Internal Revenue Service Form W-8ECI or Form W-8BEN (with
respect to a complete exemption under an income tax treaty) (or successor forms)
certifying to such Lender's entitlement to a complete exemption from United
States withholding tax with respect to payments to be made under this Agreement
and under any Note, or (ii) if the Lender is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form W-8ECI or Form W-8BEN pursuant to clause (i) above, (x) a
certificate substantially in the form of Exhibit D (any such certificate, a
"Section 5.04 Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8BEN (or successor form) (with respect
to the portfolio interest exemption) certifying to such Lender's entitlement as
of such date to a complete exemption from United States withholding tax with
respect to payments of interest to be made under this Agreement and under any
Note. In addition, each Lender agrees that from time to time after the
Restatement Effective Date, when a lapse of time or change in circumstances
renders the previous certification obsolete or inaccurate in any material
respect, it will deliver to the Borrower and the Administrative Agent two new
accurate and complete original signed copies of Internal Revenue Service Form
W-8ECI, or Form W-8BEN and a Section 5.04 Certificate, as the case may be, and
such other forms as may be required in order to confirm or establish the
entitlement of such Lender to a continued exemption from or reduction in United
States withholding tax with respect to payments under this Agreement and any
Note, or it shall immediately notify the Borrower and the Administrative Agent
of its inability to deliver any such Form or Certificate, in which case such
Lender shall not be required to deliver any such Form or Certificate pursuant to
this Section 5.04(b). Notwithstanding anything to the contrary contained in
Section 5.04(a), but subject to Section 12.04(b) and the immediately succeeding
sentence, (x) the Borrower shall be entitled, to the extent it is required to do
so by law, to deduct or withhold income or similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, Fees or other amounts payable by it hereunder for the account of
any Lender which is not a United States person (as such term is defined in
Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes to the
extent that such Lender has not provided to the
-50-
<PAGE>
Borrower U.S. Internal Revenue Service Forms that establish a complete exemption
from such deduction or withholding and (y) the Borrower shall not be obligated
pursuant to Section 5.04(a) hereof to gross-up payments to be made by it to a
Lender in respect of income or similar taxes imposed by the United States if (I)
such Lender has not provided to the Borrower the Internal Revenue Service Forms
required to be provided to the Borrower pursuant to this Section 5.04(b) or (II)
in the case of a payment, other than interest, to a Lender described in clause
(ii) above, to the extent that such Forms do not establish a complete exemption
from withholding of such taxes. Notwithstanding anything to the contrary
contained in the preceding sentence or elsewhere in this Section 5.04 and except
as set forth in Section 12.04(b), the Borrower agrees to pay any additional
amounts and to indemnify each Lender in the manner set forth in Section 5.04(a)
(without regard to the identity of the jurisdiction requiring the deduction or
withholding) in respect of any Taxes deducted or withheld by it as described in
the immediately preceding sentence as a result of any changes after the
Restatement Effective Date in any applicable law, treaty, governmental rule,
regulation, guideline or order, or in the interpretation thereof, relating to
the deducting or withholding of such Taxes.
(c) If the Borrower pays any additional amount under this
Section 5.04 to a Lender and such Lender determines in its sole discretion that
it has actually received or realized in connection therewith any refund or any
reduction of, or credit against, its Tax liabilities in or with respect to the
taxable year in which the additional amount is paid, such Lender shall pay to
the Borrower an amount that the Lender shall, in its sole discretion, determine
is equal to the net benefit, after tax, which was obtained by the Lender in such
year as a consequence of such refund, reduction or credit.
SECTION 6. CONDITIONS PRECEDENT.
6.01 CONDITIONS PRECEDENT TO RESTATEMENT EFFECTIVE DATE. The
occurrence of the Restatement Effective Date is subject to the satisfaction of
each of the following conditions at such time:
(a) EFFECTIVENESS. The parties to this Agreement shall have
executed a counterpart hereof as required by Section 12.10(i).
(b) OPINION OF COUNSEL. The Administrative Agent shall have
received opinions, addressed to each of the Agents and each of the Lenders and
dated the Restatement Effective Date, from Paul, Hastings, Janofsky & Walker LLP
(and/or other counsel reasonably acceptable to the Administrative Agent),
special counsel to the Credit Parties, which opinions shall cover the matters
contained in Exhibit E and shall be in form and substance reasonably
satisfactory to the Agents.
(c) CORPORATE PROCEEDINGS. (i) The Administrative Agent shall
have received a certificate, dated the Restatement Effective Date, signed by an
Authorized Officer of each Credit Party in the form of Exhibit F with
appropriate insertions and deletions, together with (x) copies of the Company
Documents of each Credit Party and (y) the resolutions of each Credit Party
referred to in such certificate and all of the foregoing shall be reasonably
satisfactory to the
-51
<PAGE>
Agents and (z) a statement that all of the applicable conditions set forth in
Section 6 have been satisfied as of such date.
(ii) On the Restatement Effective Date, all corporate and
legal proceedings and all instruments and agreements in connection with the
transactions contemplated by this Agreement and the other Credit Documents shall
be reasonably satisfactory in form and substance to the Agents, and the
Administrative Agent shall have received all information and copies of all
certificates, documents and papers, including good standing certificates and any
other records of corporate proceedings and governmental approvals, if any, which
either of the Agents may have reasonably requested in connection therewith, such
documents and papers, where appropriate, to be certified by proper corporate or
governmental authorities.
(d) PLANS; ETC. On or prior to the Restatement Effective Date,
there shall have been made available to the Agents upon their request:
(i) all Plans (and for each Plan that is required to file an
annual report on Internal Revenue Service Form 5500-series, a copy of
the most recent such report (including, to the extent required, the
related financial and actuarial statements and other supporting
statements, certifications, schedules and information), and for each
Plan that is a "single-employer plan," as defined in Section
4001(a)(15) of ERISA, the most recently prepared actuarial valuation
therefor) and any other "employee benefit plans," as defined in Section
3(3) of ERISA, and any other material agreements, plans or
arrangements, with or for the benefit of current or former employees of
the Borrower or any of its Subsidiaries or any ERISA Affiliate
(provided that the foregoing shall apply in the case of any
multiemployer plan, as defined in 4001(a)(3) of ERISA, only to the
extent that any document described therein is in the possession of the
Borrower or any Subsidiary of the Borrower or any ERISA Affiliate or
reasonably available thereto from the sponsor or trustee of any such
plan);
(ii) any collective bargaining agreements or any other similar
agreement or arrangements covering the employment arrangements of the
employees of the Borrower or any of its Subsidiaries;
(iii) all agreements entered into by the Borrower or any of its
Subsidiaries governing the terms and relative rights of its capital
stock;
(iv) any material agreement with respect to the management of
the Borrower or any of its Subsidiaries;
(v) any material employment agreements entered into by the
Borrower or any of its Subsidiaries; and
(vi) any tax sharing, tax allocation and other similar
agreements entered into by the Borrower and/or any of its Subsidiaries
with any entity not a Credit Party;
with all of the foregoing to be reasonably satisfactory to the Agents.
-52-
<PAGE>
(e) ADVERSE CHANGE, ETC. Since December 31, 1999, nothing
shall have occurred, and neither Agent shall have become aware of any facts or
conditions not previously known, which the Agents shall reasonably determine (i)
has had, or is reasonably likely to have, a material adverse effect on the
rights or remedies of the Lenders or the Administrative Agent hereunder or under
any other Credit Document, or on the ability of the Credit Parties taken as a
whole or Parent to perform their respective obligations under the Credit
Documents or (ii) has had or is reasonably likely to have a Material Adverse
Effect.
(f) LITIGATION. There shall be no actions, suits or
proceedings pending or, to the knowledge of the Borrower, threatened in writing
against any Credit Party (a) with respect to (i) this Agreement or any other
Credit Document or (ii) the Existing Credit Agreement or any other Existing
Credit Document or (b) which the Agents shall reasonably determine has had or is
reasonably likely to have (i) a Material Adverse Effect or (ii) a material
adverse effect on the rights or remedies of the Lenders or the Administrative
Agent hereunder or under any other Credit Document or on the ability of the
Credit Parties taken as a whole or Parent to perform their respective
obligations under the Credit Documents.
(g) APPROVALS. Except as set forth in Annex XI, all necessary
material governmental and third party approvals in connection with the Credit
Documents (including, without limitation, all necessary material approvals
required by the FCC and the applicable PUCs) required to be obtained by any
Credit Party shall have been obtained and remain in effect.
(h) AMENDED AND RESTATED SUBSIDIARY GUARANTY. On the
Restatement Effective Date, each Subsidiary Guarantor shall have duly
authorized, executed and delivered an Amended and Restated Subsidiary Guaranty
in the form of Exhibit G hereto (as modified, amended, amended and restated or
supplemented from time to time in accordance with the terms hereof and thereof,
the "Amended and Restated Subsidiary Guaranty"), and the Amended and Restated
Subsidiary Guaranty shall be in full force and effect.
(i) AMENDED AND RESTATED PLEDGE AGREEMENT. On the Restatement
Effective Date, each Credit Party (other than Parent) shall have duly
authorized, executed and delivered an Amended Pledge Agreement in the form of
Exhibit H (as modified, amended, amended and restated or supplemented from time
to time in accordance with the terms thereof and hereof, the "Amended and
Restated Pledge Agreement") and shall have delivered to the Collateral Agent, as
pledgee thereunder, all of the certificates representing the Pledged Securities
owned by such Persons, endorsed in blank or accompanied by executed and undated
stock powers, and the Amended and Restated Pledge Agreement shall be in full
force and effect.
(j) AMENDED AND RESTATED SECURITY AGREEMENT. On the
Restatement Effective Date, each Credit Party (other than Parent) shall have
duly authorized, executed and delivered the Amended and Restated Security
Agreement in the form of Exhibit I (as modified, supplemented or amended from
time to time, the "Amended and Restated Security Agreement") covering all of
such Credit Party's present and future Security Agreement Collateral, together
with:
-53-
<PAGE>
(i) proper Financing Statements (Form UCC-1 or the equivalent)
fully executed for filing under the UCC or other appropriate filing
offices of each jurisdiction as may be necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect the security
interests purported to be created by the Amended and Restated Security
Agreement;
(ii) certified copies of Requests for Information or Copies
(Form UCC-11), or equivalent reports, listing all effective financing
statements that name any Credit Party (other than Parent) or any of its
Subsidiaries as debtor and that are filed in the jurisdictions referred
to in clause (i) above, together with copies of such other financing
statements that name any Credit Party (other than Parent) or any of its
Subsidiaries as debtor (none of which shall cover the Collateral except
to the extent evidencing Permitted Liens or in respect of which the
Collateral Agent shall have received termination statements (Form UCC-3
or the equivalent) as shall be required by local law fully executed for
filing);
(iii) evidence of the completion of all other recordings and
filings of, or with respect to, the Amended and Restated Security
Agreement as may be necessary to perfect the security interests
intended to be created by the Amended and Restated Security Agreement;
and
(iv) evidence that all other actions necessary to perfect and
protect the security interests purported to be created by the Amended
and Restated Security Agreement have been taken,
and the Amended and Restated Security Agreement shall be in full force and
effect.
(k) SOLVENCY. The Borrower shall have delivered to the
Administrative Agent, a solvency certificate, dated the Restatement Effective
Date and in the form of Exhibit J, which solvency certificate shall set forth
the conclusions that, after giving effect to the entering into of the Credit
Documents, the Borrower and its Subsidiaries taken as a whole, are not
insolvent, will not be rendered insolvent by the indebtedness incurred in
connection therewith, will not be left with unreasonably small capital with
which to engage in their business and will not have incurred debts beyond their
ability to pay debts as they mature.
(l) INSURANCE. The Borrower shall have delivered to the
Administrative Agent, on or before the Restatement Effective Date updated
certificates of insurance complying with the requirements of Section 8.03 for
the business and properties of the Borrower and its Subsidiaries, in form and
substance reasonably satisfactory to the Agents and naming the Collateral Agent
as an additional insured and as loss payee, and stating that such insurance
shall not be cancelled without at least 30 days prior written notice by the
insurer to the Collateral Agent (or such shorter period of time as a particular
insurance company generally provides).
(m) EXISTING CREDIT AGREEMENT. On the Restatement Effective
Date, (A) each Existing Lender shall have surrendered to the Administrative
Agent for cancellation any promissory notes issued to it pursuant to the
Existing Credit Agreement in respect of its Existing
-54-
<PAGE>
Revolving Loans and (B) the Borrower shall have (i) paid all interest and fees
owing under the Existing Credit Agreement through the Restatement Effective Date
(whether or not due and payable at such time under the Existing Credit
Agreement) and (ii) repaid all of the principal of Existing Revolving Loans
outstanding on such date, if any.
(n) AMENDED AND RESTATED PREFERRED STOCK ISSUANCE AND CAPITAL
CONTRIBUTION AGREEMENT. Parent shall have duly authorized, executed and
delivered an agreement (the "Amended and Restated Preferred Stock Issuance and
Capital Contribution Agreement") in the form of Exhibit K, and the Amended and
Restated Preferred Stock Issuance and Capital Contribution Agreement shall be in
full force and effect.
(o) AMENDED AND RESTATED TAX SHARING AGREEMENT. On the
Restatement Effective Date, the Borrower, the Unrestricted Subsidiary and Parent
shall have duly authorized, executed and delivered the Amended and Restated Tax
Sharing Agreement in the form of Exhibit L (as amended, modified or supplemented
from time to time, the "Amended and Restated Tax Sharing Agreement"), and the
Amended and Restated Tax Sharing Agreement shall be in full force and effect.
(p) AMENDMENT TO THE PARENT CREDIT AGREEMENT. On the
Restatement Effective Date, the Parent Credit Agreement shall have been amended
to permit Parent to make cash equity contributions to the Borrower on the terms
and conditions provided for therein to enable the Borrower to support the
Business Plan, and such amendment to the Parent Credit Agreement shall be in
full force and effect.
(q) FEES. The Borrower shall have paid to the Agents and the
Lenders all Fees and expenses agreed upon by such parties to be paid on or prior
to the Restatement Effective Date (for which, in the case of legal fees and
expenses, the Borrower shall have received in advance a written invoice in
reasonable detail).
(r) BUSINESS PLAN. On or before the Restatement Effective
Date, the Administrative Agent shall have received a true and correct copy of
the Business Plan.
(r) CONSOLIDATED CASH EQUITY. On the Restatement Effective
Date, the Borrower shall have delivered to the Administrative Agent a
certificate of the Borrower's chief financial officer certifying as to the total
Consolidated Cash Equity received by the Borrower since inception through the
Restatement Effective Date.
6.02 CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The obligation
of each Lender to make Loans and the obligation of the Issuing Lender to issue
Letters of Credit (other than Existing Letters of Credit) are subject, at the
time of the making of each such Credit Event (including on the Restatement
Effective Date to the extent that there is a Credit Event on such date), to the
satisfaction of the following conditions:
(a) NOTICE OF BORROWING; LETTER OF CREDIT REQUEST. The
Administrative Agent shall have received a Notice of Borrowing meeting the
requirements of Section 2.03 or a Letter of Credit Request meeting the
requirements of Section 3.03, as the case may be.
-55-
<PAGE>
(b) NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the time of
each Credit Event and also after giving effect thereto, (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties made by
any Credit Party contained herein or in the other Credit Documents shall be true
and correct in all material respects with the same effect as though such
representations and warranties had been made on and as of the date of such
Credit Event, except to the extent that such representations and warranties
expressly relate to an earlier date, in which case such representations and
warranties shall be true and correct as of such earlier date.
The acceptance of the benefits of each Credit Event shall
constitute a representation and warranty by the Borrower that all of the
applicable conditions specified in Section 6.01 (in the case of Credit Events on
the Restatement Effective Date) and/or Section 6.02 (in the case of all Credit
Events), as the case may be, have been satisfied as of that time. All of the
certificates, legal opinions and other documents and papers referred to in
Sections 6.01 and 6.02, unless otherwise specified, shall be delivered to the
Administrative Agent for the benefit of each of the Lenders and shall be
reasonably satisfactory in form and substance to the Agents.
SECTION 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. In
order to induce the Lenders to enter into this Agreement and to make the Loans
and the Issuing Lender to issue Letters of Credit, the Borrower makes the
following representations and warranties to, and agreements with, the Lenders
(with such representations, warranties and agreements with respect to Parent
made by the Borrower to the best of its knowledge), all of which shall survive
the execution and delivery of this Agreement and the making of the Loans and
issuance of the Letters of Credit:
7.01 COMPANY STATUS. Each of the Borrower and its Subsidiaries
(i) is a duly organized and validly existing Company and is in good standing, in
each case under the laws of the jurisdiction of its organization and has the
Company power and authority to own its property and assets and to transact the
business in which it is engaged and (ii) is duly qualified and is authorized to
do business and, to the extent relevant, is in good standing in all
jurisdictions where it is required to be so qualified and where the failure to
be so qualified, authorized or in good standing would be reasonably likely to
have a Material Adverse Effect.
7.02 COMPANY POWER AND AUTHORITY. Each Credit Party has the
Company power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary action to authorize the execution, delivery and performance of the
Credit Documents to which it is a party. Each Credit Party has duly executed and
delivered each Credit Document to which it is a party and each such Credit
Document constitutes the legal, valid and binding obligation of such Person
enforceable against such Person in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and other similar
laws relating to or affecting creditors' rights generally and general equitable
principles (regardless of whether enforcement is sought in equity or at law).
7.03 NO VIOLATION. Neither the execution, delivery or
performance by any Credit Party of the Credit Documents to which it is a party
nor compliance with the terms and provisions thereof, (i) will contravene any
applicable provision of any law, statute, rule,
-56-
<PAGE>
regulation, order, writ, injunction or decree of any court or governmental
instrumentality known by it to be applicable to it, (ii) will conflict with or
result in any breach of, any of the terms, covenants, conditions or provisions
of, or constitute a default under, or (other than pursuant to the Security
Documents) result in the creation or imposition of (or the obligation to create
or impose) any Lien upon any of the property or assets of such Credit Party or
any of its Subsidiaries pursuant to the terms of any indenture, mortgage, deed
of trust or other material agreement (including the Parent Credit Agreement) or
instrument to which such Credit Party or any of its Subsidiaries is a party or
by which it or any of its property or assets are bound or to which it may be
subject or (iii) will violate any provision of the Company Documents of such
Credit Party or any of its Subsidiaries.
7.04 LITIGATION. There are no actions, suits or proceedings
pending or, to the knowledge of the Borrower, threatened in writing against any
Credit Party or any of its Subsidiaries (i) that have had, or that are
reasonably likely to have, a Material Adverse Effect or (ii) that have, or that
are reasonably likely to have had, a material adverse effect on the rights or
remedies of the Lenders or on the ability of the Credit Parties taken as a whole
or Parent to perform their respective obligations under the Credit Documents.
7.05 USE OF PROCEEDS; MARGIN REGULATIONS. (a) The proceeds of
Loans and Letters of Credit shall be used (i) to repay amounts outstanding under
the Existing Credit Agreement, (ii) for working capital, capital expenditure and
general corporate requirements of the Borrower and its Subsidiaries (including
for Permitted Acquisitions) and (iii) to pay fees and expenses incurred in
connection with the Credit Documents.
(b) Neither the making of any Loan hereunder, nor the use of
the proceeds thereof, nor the issuance of any Letter of Credit, will violate the
provisions of Regulation T, U or X of the Board of Governors of the Federal
Reserve System and no part of the proceeds of any Loan nor the issuance of any
Letter of Credit will be used to purchase or carry any Margin Stock or to extend
credit for the purpose of purchasing or carrying any Margin Stock.
7.06 GOVERNMENTAL APPROVALS. Except for such consents,
approvals and filings as have been obtained or made on or prior to the
Restatement Effective Date and remain in full force and effect, no order,
consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority (including, without limitation, the FCC
and applicable PUCs), or any subdivision thereof, is required of any Credit
Party to authorize or is required of any Credit Party in connection with (i) the
execution, delivery and performance of any Credit Document or (ii) the legality,
validity, binding effect on or enforceability against any Credit Party of any
Credit Document.
7.07 INVESTMENT COMPANY ACT. Neither the Borrower nor any of
its Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
7.08 PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Borrower
nor any of its Subsidiaries is a "holding company," or a "subsidiary company" of
a "holding company," or an
-57-
<PAGE>
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
7.09 TRUE DISCLOSURE. All factual information (taken as a
whole) heretofore or contemporaneously furnished by or on behalf of the Borrower
in writing to any Agent for purposes of or in connection with this Agreement, or
any transaction contemplated herein is, and all other such factual information
(taken as a whole) hereafter furnished by or on behalf of any Credit Party in
writing to the Lenders hereunder will be, true and accurate in all material
respects on the date as of which such information is dated or certified. The
projections (including the Projections) and PRO FORMA financial information
contained in such materials are based on good faith estimates and assumptions
believed by the Borrower to be reasonable at the time made (it being recognized
by the Lenders that such projections (including the Projections) as to future
events are not to be viewed as facts and that actual results during the period
or periods covered by any such projections may differ from the projected results
and that such assumptions and estimates may prove to be inaccurate).
7.10 FINANCIAL CONDITION; FINANCIAL STATEMENTS. (a) On and as
of the Restatement Effective Date, on a PRO FORMA basis after giving effect to
all Indebtedness incurred, and to be incurred (including, without limitation,
the Revolving Loans or Letters of Credit and the application of the proceeds
thereof), and Liens created, and to be created, by each Credit Party in
connection therewith, (x) the fair valuation of all of the tangible and
intangible assets of the Borrower and its Subsidiaries (on a consolidated basis)
will exceed their debts, (y) the Borrower and its Subsidiaries (on a
consolidated basis) will not have incurred or intended to incur debts beyond
their ability to pay such debts as such debts mature and (z) the Borrower and
its Subsidiaries (on a consolidated basis) will not have unreasonably small
capital with which to conduct their business. For purposes of this Section 7.10,
"debt" means any liability on a claim, and "claim" means (i) the right to
payment whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured; or (ii) the right to an equitable remedy
for breach of performance if such breach gives rise to a payment, whether or not
such right to an equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured or unsecured.
(b) The consolidated statement of operations of the Borrower
for the twelve months and six months ending December 31, 1999 and June 30, 2000,
respectively, and the consolidated balance sheet of the Borrower as of December
31, 1999 and June 30, 2000, copies of which have been furnished to the
Administrative Agent prior to the Restatement Effective Date, fairly present the
consolidated financial condition of the Borrower as at the dates thereof.
Nothing has occurred since December 31, 1999 that has had or is reasonably
likely to have a Material Adverse Effect.
(c) Except as reflected in the financial statements described
in Section 7.10(b) or in the footnotes thereto, there were as of the Restatement
Effective Date no liabilities or obligations with respect to the Borrower or any
of its Subsidiaries required in accordance with GAAP to be disclosed in such
financial statements of a nature (whether absolute, accrued, contingent or
otherwise and whether or not due) which, either individually or in the
aggregate, is
-58-
<PAGE>
reasonably likely to be material to the Borrower and its Subsidiaries taken as a
whole, except as incurred in the ordinary course of business consistent with
past practices.
7.11 THE SECURITY DOCUMENTS. (a) The provisions of the Amended
and Restated Security Agreement are effective to create in favor of the
Collateral Agent for the benefit of the Secured Creditors a legal, valid and
enforceable security interest in all right, title and interest of the Credit
Parties in the Security Agreement Collateral described therein to the extent
that a security interest can be created therein under the UCC, and the
Collateral Agent, for the benefit of the Secured Creditors, has a fully
perfected first lien on, and security interest in, all right, title and interest
of the Credit Parties in all of the Security Agreement Collateral described
therein (to the extent such security interest can be perfected by filing a UCC-1
financing statement or, to the extent required by the Amended and Restated
Security Agreement, by taking possession of the respective Security Agreement
Collateral), subject to no other Liens other than Permitted Liens. In addition,
the recordation of the Grant of Security Interest in U.S. Patents and Trademarks
in the form attached to the Amended and Restated Security Agreement in the
United States Patent and Trademark Office, together with filings on Form UCC-1
made pursuant to the Amended and Restated Security Agreement, will create, as
may be perfected by such filing and recordation, a perfected security interest
in the United States trademarks and patents covered by the Amended and Restated
Security Agreement and specifically identified in such Grant and the recordation
of the Grant of Security Interest in U.S. Copyrights in the form attached to the
Amended and Restated Security Agreement with the United States Copyright Office,
together with filings on Form UCC-1 made pursuant to the Amended and Restated
Security Agreement, will create, as may be perfected by such filing and
recordation, a perfected security interest in the United States copyrights
covered by the Amended and Restated Security Agreement and specifically
identified in such Grant.
(b) The security interests created in favor of the Collateral
Agent, as pledgee, for the benefit of the Secured Creditors, under the Amended
and Restated Pledge Agreement constitute perfected security interests in the
Pledge Agreement Collateral described therein, subject to no security interests
of any other Person. Except to the extent made on or prior to the Restatement
Effective Date, no filings or recordings are required to perfect (or maintain
the perfection of) the security interests created in the Pledge Agreement
Collateral.
7.12 TAX RETURNS AND PAYMENTS. Each of the Borrower and its
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, except for
those contested in good faith and adequately disclosed and fully provided for on
the financial statements of the Borrower and its Subsidiaries if and to the
extent required by GAAP. Each of the Borrower and its Subsidiaries has at all
times paid, or has provided adequate reserves (in the good faith judgment of the
management of the Borrower) for the payment of, all federal, state and foreign
income taxes applicable for all prior fiscal years which are still open for
audit and for the current fiscal year to date. There is no action, suit,
proceeding, investigation, audit, or claim now pending or, to the knowledge of
the Borrower, threatened in writing by any authority regarding any taxes owing
by the Borrower or any of its Subsidiaries which is reasonably likely to have a
Material Adverse Effect.
-59-
<PAGE>
7.13 COMPLIANCE WITH ERISA. (i) Annex III sets forth, as of
the Restatement Effective Date, each Plan and Multiemployer Plan; (ii) except as
set forth on Annex III, each Plan (and each related trust, insurance contract or
fund) is in substantial compliance with its terms and with all applicable laws,
including without limitation ERISA and the Code; each Plan which is intended to
be qualified under Section 401(a) of the Code has received a determination
letter from the Internal Revenue Service to the effect that it meets the
requirements of Section 401(a) of the Code; except as set forth on Annex III, no
Reportable Event has occurred with respect to a Plan; to the knowledge of the
Borrower, no Multiemployer Plan is insolvent or in reorganization; except as set
forth on Annex III, no Plan has an Unfunded Current Liability which, when added
to the aggregate amount of Unfunded Current Liabilities with respect to all
other Plans, exceeds $750,000; no Plan which is subject to Section 412 of the
Code or Section 302 of ERISA has an accumulated funding deficiency, within the
meaning of such sections of the Code or ERISA, or has applied for or received a
waiver of an accumulated funding deficiency or an extension of any amortization
period, within the meaning of Section 412 of the Code or Section 303 or 304 of
ERISA; all contributions required to be made with respect to a Plan or a
Multiemployer Plan have been timely made; neither the Borrower nor any
Subsidiary of the Borrower nor any ERISA Affiliate has incurred any material
liability (including any indirect, contingent or secondary liability) to or on
account of a Plan or a Multiemployer Plan pursuant to Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section
401(a)(29), 4971 or 4975 of the Code or reasonably expects to incur any such
liability under any of the foregoing sections with respect to any Plan or any
Multiemployer Plan; no condition exists which presents a material risk to the
Borrower or any Subsidiary or any ERISA Affiliate of incurring a material
liability to or on account of a Plan or, to the knowledge of the Borrower, of
any Multiemployer Plan pursuant to the foregoing provisions of ERISA and the
Code; except as set forth on Annex III, no proceedings have been instituted to
terminate or appoint a trustee to administer any Plan; except as would not
result in any material liability, no action, suit, proceeding, hearing, audit or
investigation with respect to the administration, operation or the investment of
assets of any Plan (other than routine claims for benefits) is pending, or to
the best knowledge of the Borrower expected or threatened; using actuarial
assumptions and computation methods consistent with Part 1 of subtitle E of
Title IV of ERISA, the aggregate liabilities of the Borrower and its
Subsidiaries and its ERISA Affiliates to all Multiemployer Plans in the event of
a complete withdrawal therefrom, as of the close of the most recent fiscal year
of each such Plan ended prior to the date of the most recent Credit Event, would
not exceed $15,000; except as would not result in a material liability, each
group health plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2)
of the Code) which covers or has covered employees or former employees of the
Borrower, any Subsidiary or any ERISA Affiliate has at all times been operated
in compliance with the provisions of Part 6 of subtitle B of Title I of ERISA
and Section 4980B of the Code; no lien imposed under the Code or ERISA on the
assets of the Borrower or any Subsidiary or any ERISA Affiliate exists or is
reasonably likely to arise on account of any Plan; and except as set forth in
Annex III, the Borrower and its Subsidiaries do not maintain or contribute to
any employee welfare benefit plan (as defined in Section 3(1) of ERISA) which
provides benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or any Plan the obligations with respect to
which could reasonably be expected to have a material adverse effect on the
ability of the Borrower to perform its obligations under this Agreement.
-60-
<PAGE>
7.14 SUBSIDIARIES. On and as of the Restatement Effective Date
the Borrower has no Subsidiaries other than those Subsidiaries listed on Annex
IV, which Annex IV correctly sets forth, as of the Restatement Effective Date,
the percentage ownership (direct and indirect) of the Borrower in each class of
capital stock of each of its Subsidiaries and also identifies the direct owner
thereof.
7.15 INTELLECTUAL PROPERTY. Each of the Borrower and its
Subsidiaries owns or holds a valid transferable license to use all the patents,
trademarks, service marks, trade names, technology, know-how, copyrights,
licenses, franchises and formulas or rights with respect to the foregoing, that
are used in the operation of the business of the Borrower or such Subsidiary as
presently conducted and are material to such business where the failure to own
or hold a valid license is reasonably likely to have a Material Adverse Effect
7.16 ENVIRONMENTAL MATTERS. Each of the Borrower and its
Subsidiaries is in material compliance with all applicable Environmental Laws
governing its business for which failure to comply is reasonably likely to have
a Material Adverse Effect, and neither the Borrower nor any of its Subsidiaries
is liable for any material penalties, fines or forfeitures for failure to comply
with any of the foregoing in the manner set forth above. All licenses, permits,
registrations or approvals required for the business of the Borrower and each of
its Subsidiaries under any Environmental Law have been secured and each of the
Borrower and its Subsidiaries is in substantial compliance therewith, except
such licenses, permits, registrations or approvals the failure to secure or to
comply therewith is not reasonably likely to have a Material Adverse Effect.
There are no Environmental Claims pending or, to the knowledge of the Borrower
threatened in writing, against the Borrower or any of its Subsidiaries wherein
any decision, ruling or finding would be reasonably likely to have a Material
Adverse Effect.
7.17 LABOR RELATIONS. No Credit Party is engaged in any unfair
labor practice that is reasonably likely to have a Material Adverse Effect.
There is (i) no unfair labor practice complaint pending against any Credit Party
or, to the Borrower's knowledge, threatened in writing against any of them,
before the National Labor Relations Board, and no grievance or arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against any Credit Party or, to the Borrower's knowledge, threatened in
writing against any of them, (ii) no strike, labor dispute, slowdown or stoppage
pending against any Credit Party or, to the Borrower's knowledge, threatened in
writing against any Credit Party and (iii) no union representation question, to
the Borrower's knowledge, existing with respect to the employees of any Credit
Party and no union organizing activities, to the Borrower's knowledge, are
taking place, except with respect to any matter specified in clause (i), (ii) or
(iii) above, either individually or in the aggregate, such as is not reasonably
likely to have a Material Adverse Effect.
7.18 COMPLIANCE WITH STATUTES, ETC. Each of the Borrower and
its Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property, except such non-compliance as has not had, and is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect.
-61-
<PAGE>
7.19 INDEBTEDNESS. Annex V sets forth a true and complete list
of all Indebtedness (including Contingent Obligations) of the Borrower and its
Subsidiaries as of the Restatement Effective Date and which is to remain
outstanding after giving effect to the entering into of the Credit Documents
(excluding the Loans, the Letters of Credit and any existing Capitalized Lease
Obligations (which existing Capitalized Lease Obligations shall be in compliance
with Section 9.04(c)), all such non-excluded Indebtedness is referred to as the
"Existing Indebtedness"), in each case showing the aggregate principal amount
thereof and the name of the respective borrower and any Credit Party or any of
its Subsidiaries which directly or indirectly guarantees such debt.
7.20 INSURANCE. Annex VI sets forth a true and complete
listing of all insurance maintained by the Borrower and its Subsidiaries as of
the Restatement Effective Date, and with the amounts insured (and any
deductibles) set forth therein.
SECTION 8. AFFIRMATIVE COVENANTS. The Borrower hereby
covenants and agrees that until the Total Commitment and all Letters of Credit
have terminated, no Notes are outstanding and the Loans and Unpaid Drawings,
together with interest, Fees and all other Obligations (other than any
indemnities described in Section 12.13 which are not then owing) incurred
hereunder, are paid in full:
8.01 INFORMATION COVENANTS. The Borrower will furnish to the
Administrative Agent (which will promptly forward same to each Lender):
(a) ANNUAL FINANCIAL STATEMENTS. Within 90 days after the
close of each fiscal year of the Borrower, the consolidated and consolidating
balance sheets of the Borrower and its Subsidiaries as at the end of such fiscal
year and the related consolidated and consolidating statements of operations and
of cash flows for such fiscal year, and in each case setting forth comparative
consolidated and consolidating figures for the preceding fiscal year, and (x) in
the case of consolidated statements, examined by independent certified public
accountants of recognized national standing whose opinion shall not be qualified
as to the scope of audit and as to the status of the Borrower as a going concern
or (y) in the case of consolidating statements, certified by the chief financial
officer or vice president of finance of the Borrower, together with a
certificate of such accounting firm stating that in the course of its regular
audit of the business of the Borrower and its Subsidiaries, which audit was
conducted in accordance with generally accepted auditing standards, no Default
or Event of Default which has occurred and is continuing has come to their
attention or, if such a Default or Event of Default has come to their attention
a statement as to the nature thereof.
(b) QUARTERLY FINANCIAL STATEMENTS. Within 45 days after the
close of each of the first three quarterly accounting periods in each fiscal
year commencing September 30, 2000, the consolidated and consolidating balance
sheets of the Borrower and its Subsidiaries as at the end of such quarterly
period and the related consolidated and consolidating statements of operations
and of cash flows for such quarterly period and for the elapsed portion of the
fiscal year ended with the last day of such quarterly period, and in each case
setting forth comparative consolidated and consolidating figures for the related
periods in the prior fiscal year, all of which shall be in
-62-
<PAGE>
reasonable detail and certified by the chief financial officer or vice president
of finance of the Borrower, subject to changes resulting from audit and normal
year-end audit adjustments.
(c) MONTHLY REPORTS. (A) Commencing September 30, 2000, and
only during Phase I, within 45 days after the end of each monthly accounting
period (other than the last monthly accounting period in any fiscal quarter),
the internally prepared consolidating income statements and operating statistics
report of the Borrower and its Subsidiaries for such period, setting forth in
the consolidating income statements, the budgeted figures for such months and
the variance, if any, between the budgeted amounts and actual amounts, all of
which shall be certified by the chief financial officer or vice president of
finance of the Borrower subject to changes resulting from audit and normal
year-end audit adjustments
(B) Commencing September 30, 2000, within 45 days
after the end of each monthly
accounting period, the financial data, computations and other matters required
to establish the Consolidated Senior Debt to Capitalization Ratio and
Consolidated Senior Debt to Gross PP&E Ratio, all of which shall be certified by
the chief financial officer or vice president of finance of the Borrower,
subject to changes resulting from audit and normal year-end audit adjustments
(d) BUDGETS; ETC. Not more than 30 days after the commencement
of each fiscal year of the Borrower, consolidated and consolidating budgets of
the Borrower and its Subsidiaries in reasonable detail for each of the twelve
months of such fiscal year as customarily prepared by management for its
internal use setting forth, with appropriate discussion, the principal
assumptions upon which such budgets are based. Together with each delivery of
consolidated financial statements pursuant to Sections 8.01(a), (b) and (c), a
comparison of the current year-to-date consolidated financial results for the
Borrower against the consolidated budget of the Borrower required to be
submitted pursuant to this clause (d) shall be presented.
(e) OFFICER'S CERTIFICATES. At the time of the delivery of the
financial statements provided for in Sections 8.01(a) and (b), a Compliance
Certificate of the chief financial officer, vice president of finance or other
Authorized Officer of the Borrower to the effect that no Default or Event of
Default exists or, if any Default or Event of Default does exist, specifying the
nature and extent thereof, which certificate in the case of the certificate
delivered pursuant to Sections 8.01(a) and (b), shall set forth the calculations
required to establish whether the Borrower and its Subsidiaries were in
compliance with the provisions of Sections 9.11 through 9.17, inclusive, as at
the end of such period.
(f) NOTICE OF DEFAULT OR LITIGATION. Promptly, and in any
event within five Business Days after any officer of the Borrower obtains
knowledge thereof, notice of (x) the occurrence of any event which constitutes a
Default or an Event of Default, which notice shall specify the nature thereof,
the period of existence thereof and what action the Borrower proposes to take
with respect thereto and (y) the commencement of, or any significant adverse
development in, any litigation or governmental proceeding pending against the
Borrower or any of its Subsidiaries which has had or is reasonably likely to
have a Material Adverse Effect or has had or is reasonably likely to have a
material adverse effect on the ability of the Credit Parties to perform their
obligations under the Credit Documents.
-63-
<PAGE>
(g) OTHER INFORMATION. Promptly upon transmission thereof,
copies of any filings and registrations with, and reports to, the Securities and
Exchange Commission or any successor thereto (the "SEC") by the Borrower or any
of its Subsidiaries, and with reasonable promptness, such other information or
documents (financial or otherwise) as the Administrative Agent on its own behalf
or on behalf of the Required Lenders may reasonably request from time to time.
8.02 BOOKS, RECORDS AND INSPECTIONS. The Borrower will, and
will cause each of its Subsidiaries to, permit, upon reasonable notice to the
chief financial officer, vice president of finance or any other Authorized
Officer of the Borrower, officers and designated representatives of any Agent or
the Required Lenders to visit and inspect any of the properties or assets of the
Borrower and any of its Subsidiaries in their possession (including, at the
request of any Agent and at the Borrower's expense, periodic field audits) and
to examine the books of account of the Borrower and any of its Subsidiaries and
discuss the affairs, finances and accounts of the Borrower and of any of its
Subsidiaries with, and be advised as to the same by, its and their officers and
independent accountants, all at such reasonable times and intervals during
normal business hours and to such reasonable extent as either Agent or the
Required Lenders may desire.
8.03 INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to, at all times maintain in full force and effect insurance with
reputable and solvent insurers in such amounts, covering such risks and
liabilities and with such deductibles or self-insured retentions as are in
accordance with normal industry practice. The Borrower will, and will cause each
of its Subsidiaries to, furnish to the Administrative Agent on the Restatement
Effective Date and thereafter annually, upon request of either Agent, a summary
of the insurance carried.
8.04 PAYMENT OF TAXES. The Borrower will pay and discharge,
and will cause each of its Subsidiaries to pay and discharge, all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits, or upon any properties belonging to it, prior to the date on
which penalties attach thereto, and all lawful claims which, if unpaid, would
become a Lien or charge upon any material properties of the Borrower or any of
its Subsidiaries, provided that neither the Borrower nor any Subsidiary of the
Borrower shall be required to pay any such tax, assessment, charge, levy or
claim which is being contested in good faith and by proper proceedings if it has
maintained adequate reserves (in the good faith judgment of the management of
the Borrower) with respect thereto in accordance with GAAP.
8.05 CORPORATE FRANCHISES. The Borrower will do, and will
cause each of its Subsidiaries to do, or cause to be done, all things reasonably
necessary to preserve and keep in full force and effect its existence and to
preserve its material rights and franchises, other than those the failure to
preserve which could not reasonably be expected to have a Material Adverse
Effect, provided that any transaction permitted by Section 9.02 or conducted in
compliance with Section 4.03(b) will not constitute a breach of this Section
8.05.
8.06 COMPLIANCE WITH STATUTES, ETC. The Borrower will, and
will cause each of its Subsidiaries to, comply with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign (including all Environmental Laws), in
respect of the conduct of its business and the ownership of its property other
than those the non-compliance with which is not reasonably likely to have a
Material
-64-
<PAGE>
Adverse Effect or have a material adverse effect on the ability of the Credit
Parties to perform their obligations under the Credit Documents.
8.07 ERISA. As soon as possible and, in any event, within 10
days after the Borrower knows or has reason to know of the occurrence of any of
the following, the Borrower will deliver to each of the Lenders a certificate of
the chief financial officer or vice president of finance of the Borrower setting
forth the full details as to such occurrence and the action, if any, that the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be given to
or filed with or by the Borrower, any Subsidiary of the Borrower, any ERISA
Affiliate, the PBGC, a Plan or Multiemployer Plan participant or the Plan
administrator with respect thereto: that a Reportable Event has occurred (except
to the extent that the Borrower has previously delivered to the Lender a
certificate and notices (if any) concerning such event pursuant to the next
clause hereof); that a contributing sponsor (as defined in Section 4001(a)(13)
of ERISA) of a Plan subject to Title IV of ERISA is subject to the advance
reporting requirement of PBGC Regulation Section 4043.61 (without regard to
subparagraph (b)(1) thereof), and an event described in subsection .62, .63,
.64, .65, .66, .67 or .68 of PBGC Regulation Section 4043 is reasonably expected
to occur with respect to such Plan within the following 30 days; that an
accumulated funding deficiency, within the meaning of Section 412 of the Code or
Section 302 of ERISA, has been incurred or an application may reasonably be
expected to be or has been made for a waiver or modification of the minimum
funding standard (including any required installment payments) or an extension
of any amortization period under Section 412 of the Code or Section 303 or 304
of ERISA with respect to a Plan; that any contribution required to be made with
respect to a Plan or Multiemployer Plan has not been timely made; that a Plan or
Multiemployer Plan has been or may reasonably be expected to be terminated,
reorganized, partitioned or declared insolvent under Title IV of ERISA; that a
Plan has an Unfunded Current Liability which, when added to the aggregate amount
of Unfunded Current Liabilities with respect to all other Plans, exceeds the
aggregate amount of such Unfunded Current Liabilities that existed on the
Restatement Effective Date by $100,000; that proceedings may reasonably be
expected to be or have been instituted to terminate or appoint a trustee to
administer a Plan; that a proceeding has been instituted pursuant to Section 515
of ERISA to collect a delinquent contribution to a Multiemployer Plan; except as
set forth on Annex III, that the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate will or may reasonably be expected to incur any material
liability (including any indirect, contingent, or secondary liability) to or on
account of the termination of or withdrawal from a Plan or Multiemployer Plan
under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409 or 502(i) or 502(l) of ERISA or with respect to a group health plan
(as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code; or, except as set forth on Annex III, that the
Borrower or any Subsidiary of the Borrower may incur any material liability
pursuant to any employee welfare benefit plan (as defined in Section 3(1) of
ERISA) that provides benefits to retired employees or other former employees
(other than as required by Section 601 of ERISA) or any Plan in addition to the
liability that existed on the Restatement Effective Date pursuant to any such
plan or plans. Upon request by any Lender, the Borrower will deliver to such
Lender a complete copy of the annual report (on Internal Revenue Service Form
5500-series) of each Plan (including, to the extent required, the related
financial
-65-
<PAGE>
and actuarial statements and opinions and other supporting statements,
certifications, schedules and information) required to be filed with the
Internal Revenue Service. In addition to any certificates or notices delivered
to the Lenders pursuant to the first sentence hereof, copies of any records,
documents or other information required to be furnished to the PBGC (other than
any PBGC Form 1), and any material notices received by the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate with respect to any Plan or
Multiemployer Plan shall be delivered to the Lender no later than 10 days after
the date such records, documents and/or information has been furnished to the
PBGC or such notice has been received by the Borrower, such Subsidiary or the
ERISA Affiliate, as applicable.
8.08 GOOD REPAIR. The Borrower will, and will cause each of
its Subsidiaries to, ensure that its material properties and equipment used or
useful in its business are kept in good repair, working order and condition,
normal wear and tear excepted, and, subject to Section 9.05, that from time to
time there are made in such properties and equipment all needful and proper
repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto, to the extent and in the manner useful or customary for
companies in similar businesses.
8.09 END OF FISCAL YEARS; FISCAL QUARTERS. The Borrower will,
for financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years and fourth fiscal quarters to end on December 31 of
each year and (ii) each of its, and each of its Subsidiaries', first three
fiscal quarters to end on the last day of March, June and September of each
year.
8.10 APPROVALS. The Borrower will use reasonable best efforts
to obtain as promptly as practicable after (i) the Restatement Effective Date,
the approvals set forth in Annex XI and (ii) the consummation of any Permitted
Acquisition, any approvals not obtained on or prior to the date of the
consummation of such Permitted Acquisition, provided that (x) it shall not be a
default under this Section 8.10 if the Borrower fails to obtain any such
approval, after having used reasonable best efforts to obtain same and (y) the
Borrower may cease to seek to obtain any such approvals if it has been advised
by counsel or the applicable governmental agency that it will not, or is not
reasonably likely to, obtain such approval, PROVIDED FURTHER, that, in the event
the Borrower is able to obtain any approval required to be obtained in
accordance with the terms above, the Borrower shall use reasonable best efforts
to obtain as promptly as practicable after receipt of such approval, an opinion
of local counsel reasonably satisfactory to the Agents covering the regulatory
aspects of the respective Permitted Acquisition, which opinion shall be in form
and substance reasonably satisfactory to the Agents.
SECTION 9. NEGATIVE COVENANTS. The Borrower hereby covenants
and agrees that until the Total Commitment and all Letters of Credit have
terminated, no Notes are outstanding and the Loans and Unpaid Drawings, together
with interest, Fees and all other Obligations (other than any indemnities
described in Section 12.13 which are not then owing) incurred hereunder, are
paid in full:
9.01 BUSINESS. The Borrower will not, and will not permit any
of its Subsidiaries to, engage in business operations other than business
operations that will allow the Borrower and its Subsidiaries to continue to
qualify as CLEC companies under and as defined in the Parent
-66-
<PAGE>
Credit Agreement, although the Borrower and its Subsidiaries also may engage in
other business operations as permitted by the immediately succeeding sentence so
long as such other business operations do not disqualify the Borrower and its
Subsidiaries from qualifying as CLEC companies. The Borrower will not permit at
any time the business activities taken as a whole conducted by the Borrower and
its Subsidiaries to be materially different from the business activities taken
as a whole (including incidental activities) conducted by the Borrower and its
Subsidiaries on the Restatement Effective Date and businesses reasonably related
thereto (the "Business").
9.02 CONSOLIDATION, MERGER, SALE OR PURCHASE OF ASSETS, ETC.
The Borrower will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs, or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of all or any part of
its property or assets (other than inventory or obsolete equipment or excess
equipment no longer needed in the conduct of the business in the ordinary course
of business) or purchase, lease or otherwise acquire all or any part of the
property or assets of any Person (other than purchases or other acquisitions of
inventory, leases, materials and equipment in the ordinary course of business)
or agree to do any of the foregoing at any future time without a contingency
relating to obtaining any required approval hereunder, except that the following
shall be permitted:
(a) (i) any Subsidiary of the Borrower may be merged or
consolidated with or into, or be liquidated into, the Borrower or a
Subsidiary Guarantor (so long as the Borrower or such Subsidiary
Guarantor is the surviving corporation), or all or any part of such
Subsidiary's business, properties and assets may be conveyed, sold or
transferred to the Borrower or any Subsidiary Guarantor, PROVIDED that
neither the Borrower nor any Subsidiary Guarantor may be a party to any
merger, consolidation or liquidation otherwise permitted by this clause
(a) (i) involving a Person that is not a Subsidiary except in
connection with a Permitted Acquisition and (ii) any Subsidiary that is
not a Subsidiary Guarantor may be merged or consolidated with or into,
or convey, sell or transfer its assets to, another Subsidiary that is
not a Subsidiary Guarantor, provided that if the stock of either such
Person was pledged pursuant to the Amended and Restated Pledge
Agreement the stock of the surviving entity or the transferee entity,
as the case may be, shall also be pledged pursuant to the Amended and
Restated Pledge Agreement;
(b) capital expenditures to the extent within the limitations
set forth in Section 9.05;
(c) the investments, acquisitions and transfers or
dispositions of properties permitted pursuant to Section 9.06;
(d) each of the Borrower and any Subsidiary of the Borrower
may lease (as lessee) real or personal property in the ordinary course
of business (so long as such lease does not create a Capitalized Lease
Obligation not otherwise permitted by Section 9.04(c));
-67
<PAGE>
(e) licenses or sublicenses by the Borrower and its
Subsidiaries of intellectual property in the ordinary course of
business, PROVIDED that such licenses or sublicenses shall not
interfere with the business of the Borrower or any Subsidiary of the
Borrower;
(f) Asset Sales to the extent that the aggregate Net Cash
Proceeds received from all such sales and dispositions permitted by
this clause (f) shall not exceed $8,000,000 in the aggregate and
$2,000,000 in any fiscal year of the Borrower, PROVIDED that (x) each
such sale or disposition pursuant to this clause (f) shall be in an
amount at least equal to the fair market value thereof and for proceeds
consisting of at least 85% cash and (y) the Net Cash Proceeds of any
such sale are applied to repay the Loans or reinvested in Replacement
Assets to the extent required by Section 5.02(d), PROVIDED FURTHER that
the sale or disposition of the capital stock of any Subsidiary of the
Borrower pursuant to this clause (f) shall be prohibited unless it is
for all of the outstanding capital stock of such Subsidiary owned by
the Borrower and its Subsidiaries;
(g) leases and subleases permitted under Sections 9.03(d)
and (g); and
(h) Permitted Acquisitions.
9.03 LIENS. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or
with respect to any property or assets of any kind (real or personal, tangible
or intangible) of the Borrower or any such Subsidiary whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with recourse to the
Borrower or any of its Subsidiaries) or assign any right to receive income,
except:
(a) Liens for taxes not yet delinquent or Liens for taxes
being contested in good faith and by appropriate proceedings for which
adequate reserves (in the good faith judgment of the management of the
Borrower) have been established;
(b) Liens in respect of property or assets of the Borrower or
any of its Subsidiaries imposed by law which were incurred in the
ordinary course of business, such as carriers', warehousemen's and
mechanics' Liens, statutory landlord's Liens, and other similar Liens
arising in the ordinary course of business, and (x) which do not in the
aggregate materially detract from the value of such property or assets
or materially impair the use thereof in the operation of the business
of the Borrower or any of its Subsidiaries or (y) which are being
contested in good faith by appropriate proceedings, which proceedings
have the effect of preventing the forfeiture or sale of the property or
asset subject to such Lien;
(c) Liens created by or pursuant to this Agreement or the
other Credit Documents;
(d) Liens created pursuant to Capital Leases in respect of
Capitalized Lease Obligations permitted by Section 9.04(c);
-68-
<PAGE>
(e) Liens arising from judgments, decrees or attachments and
Liens securing appeal bonds arising from judgments, in each case in
circumstances not constituting an Event of Default under Section 10.10;
(f) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory
obligations, surety bonds, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations
incurred in the ordinary course of business (exclusive of obligations
in respect of the payment for borrowed money);
(g) leases or subleases granted to others not interfering in
any material respect with the business of the Borrower or any of its
Subsidiaries;
(h) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the ordinary conduct of the
business of the Borrower or any of its Subsidiaries;
(i) Liens arising from precautionary UCC financing statement
filings regarding operating leases entered into by the Borrower or any
of its Subsidiaries in the ordinary course of business and statutory
and common law landlords' liens under leases to which the Borrower or
any of its Subsidiaries is a party;
(j) purchase money Liens securing payables arising from the
purchase by the Borrower or any Subsidiary Guarantor of any equipment
or goods in the ordinary course of business, provided that such
payables shall not constitute Indebtedness;
(k) any interest or title of a lessor under any lease
permitted by this Agreement;
(l) Liens in existence on, and which are to continue in effect
after, the Restatement Effective Date which are listed, and the
property subject thereto described in, Annex VII, plus extensions and
renewals of such Liens, provided that (x) the aggregate principal
amount of the Indebtedness, if any, secured by such Liens does not
increase (other than interest and fees to be financed in connection
with such Indebtedness) from that amount outstanding at the time of any
such extension or renewal and (y) any such extension or renewal does
not encumber any additional assets or properties of the Borrower or any
of its Subsidiaries;
(m) Liens arising pursuant to purchase money mortgages or
security interests securing Indebtedness representing the purchase
price (or financing of the purchase price within 90 days after the
respective purchase) of assets acquired by the Borrower or any
Subsidiary after the Restatement Effective Date, provided that (x) any
such Liens attach only to the assets so acquired, (y) the Indebtedness
secured by any such Lien does not exceed 100%, nor is less than 70%, of
the lesser of the fair market value or purchase price of the property
being purchased at the time of the incurrence of such Indebtedness and
(z)
-69-
<PAGE>
all Indebtedness secured by Liens created pursuant to this clause
(m) shall not exceed $5,000,000 at any time outstanding; and
(n) Liens on property or assets acquired pursuant to a
Permitted Acquisition, or on property or assets of a Person in
existence at the time such Person is acquired pursuant to a Permitted
Acquisition, in each case securing Permitted Acquired Debt, PROVIDED
that (x) such Liens do not attach to the capital stock of any
Subsidiary of the Borrower and (y) such Liens existed prior to, and
were not incurred in contemplation of, such Permitted Acquisition and
do not attach to any other asset of the Borrower or any of its
Subsidiaries.
9.04 INDEBTEDNESS. The Borrower will not, and will not permit
any of its Subsidiaries to, contract, create, incur, assume or suffer to exist
any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the
other Credit Documents;
(b) Indebtedness owing by (i) any Subsidiary Guarantor to
another Subsidiary Guarantor or the Borrower, (ii) the Borrower to any
Subsidiary Guarantor, (iii) any Subsidiary that is not a Subsidiary
Guarantor to any other Subsidiary that is not a Subsidiary Guarantor,
(iv) the Borrower or any Subsidiary Guarantor to any Subsidiary that is
not a Subsidiary Guarantor, so long as such Indebtedness is
subordinated to the Obligations on a basis satisfactory to the Agents
and/or (v) any Subsidiary that is not a Subsidiary Guarantor to the
Borrower and/or a Subsidiary Guarantor, so long as such Indebtedness
constitutes a senior obligation and is evidenced by an intercompany
note (which may be a grid note) pledged to the Collateral Agent
pursuant to the Amended and Restated Pledge Agreement;
(c) Capitalized Lease Obligations, provided that the aggregate
Capitalized Lease Obligations outstanding at any time under all Capital
Leases entered into shall not exceed $20,000,000;
(d) Indebtedness under Interest Rate Agreements entered into
with respect to Indebtedness under this Agreement and other
Indebtedness permitted under this Section 9.04, PROVIDED that
management of the Borrower or such Subsidiary, as the case may be, has
determined in good faith that the entering into such Interest Rate
Agreements are BONA FIDE hedging activities and are not for speculative
purposes;
(e) Indebtedness incurred pursuant to purchase money mortgages
permitted by Section 9.03(m);
(f) Existing Indebtedness, without giving effect to any
subsequent extension, renewal or refinancing thereof, except as
permitted pursuant to clause (i) below;
(g) Indebtedness of the Borrower or any of its Subsidiaries
which may be deemed to exist in connection with agreements providing
for indemnification, purchase price adjustments and similar obligations
in connection with Permitted Acquisitions, or sales of assets permitted
by this Agreement (so long as any such obligations are those of the
-70-
<PAGE>
Person making the respective acquisition or sale, and are not
guaranteed by any other Person, other than the Borrower or any of its
Subsidiaries);
(h) Permitted Acquired Debt;
(i) Permitted Refinancing Indebtedness, so long as no Default
or Event of Default is in existence at the time of the incurrence
thereof and immediately after giving effect thereto;
(j) Permitted Subordinated Debt, in each case so long as (i)
no Default or Event of Default is then in existence or would result
therefrom, (ii) to the extent that any such Permitted Subordinated Debt
is to require any cash interest payments prior to the date that is six
months after the Final Maturity Date, (A) at least 10 Business Days
prior to the incurrence of any such Permitted Subordinated Debt, the
Borrower shall deliver to the Administrative Agent (x) a certificate of
the Borrower's chief financial officer certifying that (and showing
calculations in reasonable detail) immediately prior to, and after
giving effect to, such incurrence all the covenants contained in
Sections 9.11 through 9.17, inclusive, shall be complied with on a PRO
FORMA basis (as if such incurrence had occurred on the first day of the
six month period then last ended), and (y) financial projections
prepared in good faith by the Borrower's chief financial officer
demonstrating in reasonable detail that the Borrower will continue to
be in compliance (after giving effect to such issuance) with all the
covenants contained in Sections 9.11 through 9.17, inclusive, through
the Final Maturity Date, and (B) (x) to the extent that the respective
issuance is to occur during Phase I, the Consolidated Debt to
Capitalization Ratio after giving effect to such incurrence shall be
less than 0.50 and (y) to the extent that the respective incurrence is
to occur during Phase II, the Consolidated Debt to Capitalization Ratio
after giving effect to such incurrence shall be less than 0.65, and
(iii) (A) such Permitted Subordinated Debt is unsecured and
unguaranteed, (B) such Permitted Subordinated Debt does not have any
maturities, scheduled repayments, sinking fund requirements,
amortizations or similar payments prior to the one year anniversary of
the Final Maturity Date, (C) such Permitted Subordinated Debt does not
contain any financial maintenance covenants (whether structured as a
covenant or an event of default) or capital expenditure limitations,
(D) the other covenants contained in such Permitted Subordinated Debt
are no more restrictive on the Borrower and its Subsidiaries than those
contained in this Agreement and (E) all of the events of default,
remedies and subordination provisions contained therein shall be
reasonably satisfactory to the Agents; and
(k) additional unsecured Indebtedness of the Borrower and the
Subsidiary Guarantors not to exceed an aggregate outstanding principal
amount of $5,000,000 at any time.
9.05 CAPITAL EXPENDITURES. (a) The Borrower will not, and will
not permit any of its Subsidiaries to, make any Consolidated Capital
Expenditures, except that during any period of the Borrower set forth below
(taken as one accounting period), the Borrower and its Subsidiaries may make
Consolidated Capital Expenditures so long as the aggregate amount of all such
-71-
<PAGE>
Consolidated Capital Expenditures does not exceed in any period set forth below
the amount set forth opposite such period below:
PERIOD AMOUNT
------ ------
Fiscal year ending:
December 31, 2000 $102,000,000
December 31, 2001 $68,000,000
December 31, 2002 $91,000,000
December 31, 2003 $26,000,000
December 31, 2004 $26,000,000
December 31, 2005 $26,000,000
December 31, 2006 $33,000,000
December 31, 2007 $50,000,000
(b) In the event that the maximum amount which is permitted to
be expended in respect of Consolidated Capital Expenditures during any fiscal
year pursuant to Section 9.05(a) (without giving effect to this clause (b)) is
not fully expended during such fiscal year, the maximum amount which may be
expended during the immediately succeeding fiscal year pursuant to Section
9.05(a) shall be increased by such unutilized amount.
9.06 ADVANCES, INVESTMENTS AND LOANS. The Borrower will not,
and will not permit any of its Subsidiaries to, lend money or credit or make
advances to any Person, or purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to any
Person, except:
(a) the Borrower or any Subsidiary of the Borrower may invest
in cash and Cash Equivalents;
(b) the Borrower and any Subsidiary of the Borrower may
acquire and hold receivables owing to them, if created or acquired in
the ordinary course of business and payable or dischargeable in
accordance with customary trade terms and/or reasonable extensions
thereof;
(c) loans and advances to officers, directors and employees of
the Borrower and its Subsidiaries in the ordinary course of business
(x) for relocation purposes and/or the purchase from the Borrower of
the capital stock (or options or warrants relating thereto) of the
Borrower and (y) otherwise in an aggregate principal amount not to
exceed $1,000,000 at any time outstanding shall be permitted;
(d) the Borrower and each Subsidiary of the Borrower may
acquire and own investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of,
-72-
<PAGE>
and other disputes with, customers and suppliers arising in the
ordinary course of business;
(e) Interest Rate Agreements entered into with respect to
Indebtedness under this Agreement and other Indebtedness permitted
under Section 9.04, PROVIDED that management of the Borrower or such
Subsidiary, as the case may be, has determined in good faith that
entering into such Interest Rate Agreements are BONA FIDE hedging
activities and are not for speculative purposes.
(f) advances, loans and investments in existence on the
Restatement Effective Date and listed on Annex VIII, without giving
effect to any additions thereto or replacements thereof, shall be
permitted;
(g) the Borrower and each Subsidiary may make capital
contributions to any of their Subsidiaries to the extent such
Subsidiary is a Subsidiary Guarantor;
(h) Subsidiaries may be established or created in accordance
with the provisions of Section 9.07;
(i) Permitted Acquisitions shall be permitted;
(j) loans and investments not otherwise permitted by the
foregoing clauses (a) through (i), provided that the aggregate amount
of the loans and investments made pursuant to this clause (j) shall not
exceed $2,000,000; and
(k) the Borrower and its Subsidiaries may acquire and hold
investments consisting of non-cash consideration received from sales of
assets effected in accordance with the requirements of Section 9.02(f).
9.07 LIMITATION ON CREATION OF SUBSIDIARIES. The Borrower will
not, and will not permit any of its Subsidiaries to, establish, create or
acquire any direct Subsidiary; provided that the Borrower and its Subsidiaries
shall be permitted to (i) establish, create and, pursuant to a Permitted
Acquisition, acquire Wholly-Owned Subsidiaries and (ii) acquire 90%-Owned
Subsidiaries pursuant to a Permitted Acquisition, so long as in the case of
clauses (i) and (ii) above, as the case may be, (A) 100% of the capital stock of
such new Wholly-Owned Subsidiary or at least 90% of the capital stock of such
new 90%-Owned Subsidiary is pledged pursuant to the Amended and Restated Pledge
Agreement and the certificates representing such stock, together with stock
powers duly executed in blank, are delivered to the Collateral Agent and (B)
such new Wholly-Owned Subsidiary or 90%-Owned Subsidiary executes a counterpart
of the Amended and Restated Subsidiary Guaranty, the Amended and Restated Pledge
Agreement and the Amended and Restated Security Agreement, in each case on the
same basis (and to the same extent) as such Wholly-Owned Subsidiary or 90%-Owned
Subsidiary would have executed such Credit Documents if it were a Credit Party
on the Restatement Effective Date.
9.08 MODIFICATIONS. The Borrower will not, and will not permit
any of its Subsidiaries to:
-73-
<PAGE>
(a) make (or give any notice in respect thereof) any voluntary
or optional payment, prepayment, redemption, acquisition for value of
(including, without limitation, by way of depositing with the trustee
with respect thereto money or securities before due for the purpose of
paying when due) or exchange of any Permitted Acquired Debt, any
Permitted Subordinated Debt or any Permitted Refinancing Indebtedness,
provided that the respective obligor may refinance any of the foregoing
Indebtedness with the proceeds of Permitted Refinancing Indebtedness so
long as no Default or Event of Default is in existence at the time of
the incurrence of such Permitted Refinancing Indebtedness and
immediately after giving effect thereto; (d) each of the Borrower and
any Subsidiary of the Borrower may lease (as lessee) real or personal
property in the ordinary course of business (so long as such lease does
not create a Capitalized Lease Obligation not otherwise permitted by
Section 9.04(c));
(b) amend or modify (or permit the amendment or modification
of) in any manner adverse to the interests of the Lenders, any
provisions of any Permitted Acquired Debt, any Permitted Subordinated
Debt or any Permitted Refinancing Indebtedness;
(c) amend, modify or change in any manner, taken as a whole,
adverse to the interests of the Lenders the Company Documents of any
Credit Party, or enter into any new agreement in any manner materially
adverse to the interests of the Lenders with respect to the capital
stock of the Borrower; or
(d) amend, modify or change in any manner materially adverse
to the interests of the Lenders, the Amended and Restated Tax Sharing
Agreement.
9.09 DIVIDENDS, ETC. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, declare or pay any dividends (other than
dividends payable solely in capital stock of such Person) or return any capital
to, its stockholders, members and/or other owners or authorize or make any other
distribution, payment or delivery of property or cash to its stockholders,
members and/or other owners as such, or redeem, retire, purchase or otherwise
acquire, directly or indirectly, for a consideration, any shares of any class of
its capital stock or other ownership interests now or hereafter outstanding (or
any warrants for or options or stock appreciation rights in respect of any of
such shares), or set aside any funds for any of the foregoing purposes, or
permit any of its Subsidiaries to purchase or otherwise acquire for
consideration any shares of any class of the capital stock or other ownership
interests of the Borrower or any other Subsidiary of the Borrower, as the case
may be, now or hereafter outstanding (or any options or warrants or stock
appreciation rights issued by such Person with respect to its capital stock)
(all of the foregoing "Dividends"), except that:
(i) any Subsidiary of the Borrower may pay dividends or return
capital or make distributions and other similar payments with regard to
its capital stock or other membership interests to the Borrower or to
another Subsidiary of the Borrower;
(ii) any 90%-Owned Subsidiary of the Borrower may pay cash
Dividends to the holders of its capital stock, so long as the Borrower
or its respective Subsidiary which owns the capital stock in the 90%
Owned-Subsidiary paying such Dividends receives at least its pro rata
share thereof;
-74-
<PAGE>
(iii) during Phase II, so long as (a) no Default or Event of
Default then exists or would result therefrom, (b) the Leverage Ratio
on the date of payment thereof (calculated on a PRO FORMA basis after
giving effect to the incurrence of any Credit Event on such date) is
less than 3.50:1.00 and (c) the Borrower has theretofore made all
payments required to be made pursuant to Section 5.02(g), the Borrower
may pay Dividends in any fiscal year (but only after the respective
Excess Cash Payment Date for such fiscal year) in an amount not to
exceed 50% of the Borrower's Excess Cash Flow for the relevant Excess
Cash Payment Period; and
(iv) the Borrower may redeem or repurchase its stock (or
options, warrants and/or appreciation rights in respect thereof) from
shareholders, officers, employees, consultants and directors (or their
estates) of the Borrower or any of its Subsidiaries upon the death,
permanent disability, retirement or termination of employment of any
such Person or otherwise in accordance with any shareholder agreement,
stock option plan or any employee stock ownership plan, provided that
(x) no Default or Event of Default is then in existence or would arise
therefrom and (y) the aggregate amount of all cash paid in respect of
all such shares, options, warrants and rights so redeemed or
repurchased in any fiscal year does not exceed $1,000,000.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, create or otherwise cause or suffer to exist any encumbrance or
restriction which prohibits or otherwise restricts (A) the ability of any
Subsidiary of the Borrower to (a) pay dividends or make other distributions or
pay any Indebtedness owed to the Borrower or any Subsidiary of the Borrower, (b)
make loans or advances to the Borrower or any Subsidiary of the Borrower , (c)
transfer any of its properties or assets to the Borrower or any Subsidiary of
the Borrower or (B) the ability of any Subsidiary of the Borrower to create,
incur, assume or suffer to exist any Lien upon its property or assets to secure
the Obligations, other than prohibitions or restrictions existing under or by
reason of: (i) this Agreement and the other Credit Documents; (ii) applicable
law; (iii) customary non-assignment provisions entered into in the ordinary
course of business and consistent with past practices; (iv) any restriction or
encumbrance with respect to a Subsidiary of the Borrower imposed pursuant to an
agreement which has been entered into for the sale or disposition of all or
substantially all of the capital stock or assets of such Subsidiary, so long as
such sale or disposition is permitted under this Agreement; (v) Liens permitted
under Sections 9.03(d), (m) and/or (n) and any documents or instruments
governing the terms of any Indebtedness or other obligations secured by any such
Liens, provided that such prohibitions or restrictions apply only to the assets
subject to such Liens; and (vi) any agreement or instrument governing Permitted
Acquired Debt, to the extent such restriction or encumbrance (x) is not
applicable to any Person or the properties or assets of any Person (other than
the Person or the properties or assets of the Person acquired pursuant to the
respective Permitted Acquisition) and (y) was not created (or made more
restrictive) in connection with or in anticipation of the respective Permitted
Acquisition.
9.10 TRANSACTIONS WITH AFFILIATES. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into any transaction or series
of transactions after the Restatement Effective Date whether or not in the
ordinary course of business, with any Affiliate other than on terms and
conditions substantially as favorable to the Borrower or such Subsidiary as
would be
-75-
<PAGE>
obtainable by the Borrower or such Subsidiary at the time in a comparable
arm's-length transaction with a Person other than an Affiliate, provided that
the foregoing restrictions shall not apply to (i) transactions solely among
Credit Parties and their 90%-Owned Subsidiaries or Wholly-Owned Subsidiaries,
(ii) employment arrangements entered into in the ordinary course of business
with officers of the Borrower and its Subsidiaries, (iii) customary fees paid to
members of the Board of Directors of the Borrower and of its Subsidiaries, (iv)
management fees and expenses paid to Parent or any of its Subsidiaries during
any fiscal year pursuant to the Management Services Agreement, (v) arrangements
with directors, officers and employees not otherwise prohibited by this
Agreement, (vi) the Amended and Restated Tax Sharing Agreement, (vii) the
Amended and Restated Preferred Stock Issuance and Capital Contribution
Agreement, (viii) payment of customary legal fees and expenses to Paul,
Hastings, Janofsky & Walker LLP and (ix) the transactions set forth on Annex IX.
9.11 MINIMUM CONSOLIDATED REVENUE. During Phase I, the
Borrower will not permit Consolidated Revenue for any six-month period ending on
the date set forth below to be less than the amount set forth opposite such
six-month period below:
SIX-MONTH PERIOD ENDING ON AMOUNT
-------------------------- ------
September 30, 2000 $25,000,000
December 31, 2000 $32,000,000
March 31, 2001 $42,000,000
June 30, 2001 $55,000,000
September 30, 2001 $69,000,000
December 31, 2001 $84,000,000
March 31, 2002 $100,000,000
June 30, 2002 $115,000,000
September 30, 2002 $131,000,000
December 31, 2002 $148,000,000
March 31, 2003 $165,500,000
June 30, 2003 $180,000,000
9.12 MINIMUM CONSOLIDATED EBITDA. During Phase I and the first
two quarters of Phase II, the Borrower will not permit Consolidated EBITDA for
any six-month period ending on the date set forth below to be less than the
amount set forth opposite such six-month period below:
-76-
<PAGE>
September 30, 2000 $(48,000,000)
December 31, 2000 $(65,000,000)
March 31, 2001 $(74,000,000)
June 30, 2001 $(75,000,000)
September 30, 2001 $(71,000,000)
December 31, 2001 $(61,000,000)
March 31, 2002 $(47,000,000)
June 30, 2002 $(31,000,000)
September 30, 2002 $(16,000,000)
December 31, 2002 $(1,000,000)
March 31, 2003 $12,000,000
June 30, 2003 $22,000,000
September 30, 2003 $29,500,000
9.13 CONSOLIDATED SENIOR DEBT TO CAPITALIZATION RATIO. The
Borrower will not permit the Consolidated Senior Debt to Capitalization Ratio to
exceed 0.50.
9.14 CONSOLIDATED DEBT TO CAPITALIZATION RATIO. The Borrower
will not permit the Consolidated Debt to Capitalization Ratio to exceed 0.65.
9.15 INTEREST COVERAGE RATIO. During Phase II, for any fiscal
quarter ending on any date set forth below, the Borrower will not permit the
ratio of (i) Consolidated Annualized EBITDA to (ii) Consolidated Annualized
Interest Expense to be less than the ratio set forth opposite such date below:
FISCAL QUARTER ENDING RATIO
--------------------- -----
The last day of each fiscal quarter during the period 1.00 to 1
from the commencement of Phase II to and including
March 31, 2003
June 30 2003 1.25 to 1
September 30, 2003 1.50 to 1
December 31, 2003 2.00 to 1
March 31, 2004 2.00 to 1
June 30, 2004 2.25 to 1
September 30, 2004 and thereafter 2.50 to 1
9.16 LEVERAGE RATIO. During Phase II, the Borrower will not
permit the Leverage Ratio determined as at the end of the last day of any fiscal
quarter ending on any date set forth below to be more than the ratio set forth
opposite such date below:
-77-
<PAGE>
FISCAL QUARTER ENDING RATIO
--------------------- -----
The last day of each fiscal quarter during the period 10.00 to 1
from the commencement of Phase II to and including
March 31, 2003
to June 30, 2003 6.75 to 1
September 30, 2003 5.25 to 1
December 31, 2003 4.25 to 1
March 31, 2004 3.75 to 1
June 30, 2004 3.75 to 1
September 30, 2004 and thereafter 3.50 to 1
9.17 FIXED CHARGE RATIO. During Phase II, for any fiscal
quarter ending on any date set forth below, the Borrower will not permit the
ratio of (i) Consolidated Annualized EBITDA to (ii) Consolidated Annualized
Fixed Charges to be less than the ratio set forth opposite such date below:
FISCAL QUARTER ENDING RATIO
--------------------- -----
The last day of each fiscal quarter from and after 1.00 to 1
the commencement of Phase II
9.18 LIMITATION ON ISSUANCE OF SUBSIDIARY STOCK. The Borrower
will not permit any of its Subsidiaries, directly or indirectly, to issue any
shares of such Subsidiary's capital stock or other securities (or warrants,
rights or options to acquire shares or other equity securities), except (i) for
replacements of then outstanding shares of capital stock, (ii) for stock splits,
stock dividends and similar issuances which do not decrease the percentage
ownership of the Borrower and its Subsidiaries taken as a whole in any class of
the capital stock of such Subsidiary, (iii) for issuances to the Borrower or any
of its Subsidiaries in connection with the creation of new Subsidiaries
permitted under Section 9.07 and (iv) to qualify directors to the extent
required by applicable law.
9.19 LIMITATION ON ASSETS OF THE UNRESTRICTED SUBSIDIARY. The
Borrower will not permit the Unrestricted Subsidiary to own any asset other than
the Borrower's membership interest at any time in Northeast Competitive Access
Providers, LLC.
SECTION 10. EVENTS OF DEFAULT. Upon the occurrence of any of
the following specified events (each, an "Event of Default"):
10.01 PAYMENTS. The Borrower shall (i) default in the payment
when due of any principal of any of the Loans or (ii) default, and such default
shall continue for five or more Business Days, in the payment when due of any
interest on any of the Loans, Unpaid Drawings or any Fees or any other amounts
owing hereunder or under any other Credit Document; or
-78-
<PAGE>
10.02 REPRESENTATIONS, ETC. Any representation, warranty or
statement made or deemed made by any Credit Party herein or in any other Credit
Document or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove to be untrue in any material
respect on the date as of which made or deemed made; or
10.03 COVENANTS. Any Credit Party shall (a) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 8.09 or Section 9 (other than Sections 9.11 and 9.12), (b) default in
the due performance or observance by it of any term, covenant or agreement
contained in Section 9.11 or 9.12, and such default shall continue for a period
of 30 or more Business Days, or (c) default in the due performance or observance
by it of any term, covenant or agreement (other than those referred to in
Section 10.01, 10.02, 10.09 or clause (a) or (b) of this Section 10.03)
contained in this Agreement and such default shall continue unremedied for a
period of at least 30 days after written notice to the Borrower by the
Administrative Agent or the Required Lenders; or
10.04 DEFAULT UNDER OTHER AGREEMENTS. (a) The Borrower or any
of its Subsidiaries shall (i) default in any payment with respect to any
Indebtedness (other than the Obligations) beyond the period of grace, if any,
applicable thereto or (ii) default in the observance or performance of any
agreement or condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause, any such Indebtedness to become due prior to its stated maturity; or (b)
any such Indebtedness of the Borrower or any of its Subsidiaries shall be
declared to be due and payable (or shall be required to be prepaid as a result
of a default thereunder or of an event of the type that constitutes an Event of
Default) prior to the stated maturity thereof, provided that it shall not
constitute an Event of Default pursuant to this Section 10.04 unless the
aggregate principal amount of all Indebtedness referred to in clauses (a) and
(b) above exceeds $3,000,000 in the aggregate at any one time or (c) Parent
shall (i) default in any payment of interest or principal beyond the period of
grace, if any, applicable thereto under the Parent Credit Agreement or (ii) the
Indebtedness of Parent under the Parent Credit Agreement shall be declared to be
due and payable (or shall be required to be prepaid as a result of a default
thereunder or of an event of the type that constitutes an Event of Default)
prior to the stated maturity thereof.
10.05 BANKRUPTCY, ETC. The Borrower or any of its Material
Subsidiaries shall commence a voluntary case concerning itself under Title 11 of
the United States Code entitled "Bankruptcy," as now or hereafter in effect, or
any successor thereto (the "Bankruptcy Code"); or an involuntary case is
commenced against the Borrower or any of its Material Subsidiaries and the
petition is not controverted within 20 days, or is not dismissed within 60 days,
after commencement of the case; or a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of the Borrower or any of its Material Subsidiaries; or the Borrower or
any of its Material Subsidiaries commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or
hereafter in effect relating to the Borrower or any of its Material
Subsidiaries; or there is commenced
-79-
<PAGE>
against the Borrower or any of its Material Subsidiaries any such proceeding
which remains undismissed for a period of 60 days; or the Borrower or any of its
Material Subsidiaries is adjudicated insolvent or bankrupt; or any order of
relief or other order approving any such case or proceeding is entered; or the
Borrower or any of its Material Subsidiaries suffers any appointment of any
custodian or the like for it or any substantial part of its property to continue
undischarged or unstayed for a period of 60 days; or the Borrower or any of its
Material Subsidiaries makes a general assignment for the benefit of creditors;
or any corporate action is taken by the Borrower or any of its Material
Subsidiaries for the purpose of effecting any of the foregoing; or
10.06 ERISA. (a) Any Plan or Multiemployer Plan shall fail to
satisfy the minimum funding standard required for any plan year or part thereof
under Section 412 of the Code or Section 302 of ERISA or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code or Section 303 or 304 of ERISA, a Reportable Event shall
have occurred, a contributing sponsor (as defined in Section 4001(a)(13) of
ERISA) of a Plan subject to Title IV of ERISA shall be subject to the advance
reporting requirement of PBGC Regulation Section 4043.61 (without regard to
subparagraph (b)(1) thereof) and an event described in subsection .62, .63, .64,
.65, .66, .67 or .68 of PBGC Regulation Section 4043 shall be reasonably
expected to occur with respect to such Plan within the following 30 days, any
Plan which is subject to Title IV of ERISA shall have had or is likely to have a
trustee appointed to administer such Plan, any Plan or Multiemployer Plan which
is subject to Title IV of ERISA is, shall have been or is likely to be
terminated or to be the subject of termination proceedings under ERISA, any Plan
shall have an Unfunded Current Liability, a contribution required to be made
with respect to a Plan, Multiemployer Plan has not been timely made, the
Borrower or any Subsidiary of the Borrower or any ERISA Affiliate has incurred
or is likely to incur any liability to or on account of a Plan or Multiemployer
Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204
or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or on account
of a group health plan (as defined in Section 607(1) of ERISA or Section
4980B(g)(2) of the Code) under Section 4980B of the Code, or the Borrower or any
Subsidiary of the Borrower has incurred or is likely to incur liabilities
pursuant to one or more employee welfare benefit plans (as defined in Section
3(1) of ERISA) that provide benefits to retired employees or other former
employees (other than as required by Section 601 of ERISA) or Plans; (b) there
shall result from any such event or events the imposition of a lien, the
granting of a security interest, or a liability or a material risk of incurring
a liability; and (c) such lien, security interest or liability, individually
and/or in the aggregate, in the opinion of the Required Lenders, has had, or is
reasonably likely to have, a Material Adverse Effect; or
10.07 SECURITY DOCUMENTS. (a) Except in each case to the
extent resulting from the negligent or willful failure of the Collateral Agent
to continue to hold Pledged Securities under the Amended and Restated Pledge
Agreement, any of the Security Documents shall cease to be, in any material
respect, in full force and effect, or shall cease, in any material respect, to
give the Collateral Agent the Liens, rights, powers and privileges purported to
be created thereby in favor of the Collateral Agent, or (b) any Credit Party
shall default in the due performance or observance of any material term,
covenant or agreement on its part to be performed or observed pursuant to any of
the Security Documents and such default shall continue for 30 or more days after
written notice to the respective Credit Party by the Administrative Agent; or
-80-
<PAGE>
10.08 AMENDED AND RESTATED SUBSIDIARY GUARANTY. Any Amended
and Restated Subsidiary Guaranty or any material provision thereof shall cease
to be in full force and effect, or any Subsidiary Guarantor or any Person acting
by or on behalf of such Subsidiary Guarantor shall deny or disaffirm such
Subsidiary Guarantor's obligations under any Amended and Restated Subsidiary
Guaranty; or
10.09 AMENDED AND RESTATED PREFERRED STOCK ISSUANCE AND
CAPITAL CONTRIBUTION AGREEMENT. The Amended and Restated Preferred Stock
Issuance and Capital Contribution Agreement or any material provision thereof
shall cease to be in full force and effect or Parent shall deny or disaffirm its
obligations thereunder or default in the performance of its agreements and
conditions thereunder; or
10.10 JUDGMENTS. One or more judgments or decrees shall be
entered against the Borrower or any of its Subsidiaries involving a liability
(to the extent not paid or covered by insurance) in excess of $3,000,000 in the
aggregate at any time outstanding for all such judgments and decrees for the
Borrower and its Subsidiaries and all such judgments and decrees in excess of
such amount shall not have been vacated, discharged or stayed or bonded pending
appeal within 60 days from the entry thereof; or
10.11 CHANGE OF CONTROL. A Change of Control shall occur; or
10.12 POSITIVE EBITDA. Without limiting the provisions of
Section 9.12 and only so long as Phase II shall not have theretofore occurred,
the Borrower shall fail to have positive Consolidated EBITDA for either its
fiscal quarter ending March 31, 2003 or June 30, 2003; or
10.13 AMENDMENT TO THE PARENT CREDIT AGREEMENT. The Parent
Credit Agreement shall be amended or modified in any manner which imposes
additional restrictions or conditions on the ability of Parent to make cash
contributions to the Borrower in addition to those that exist as of the
Restatement Effective Date;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent shall, upon the written
request of the Required Lenders, by written notice to the Borrower, take any or
all of the following actions, without prejudice to the rights of the
Administrative Agent or any Lender to enforce its claims against any Subsidiary
Guarantor or the Borrower, except as otherwise specifically provided for in this
Agreement (PROVIDED that, if an Event of Default specified in Section 10.05
shall occur with respect to the Borrower, the result which would occur upon the
giving of written notice by the Administrative Agent as specified in clauses (i)
and (ii) below shall occur automatically without the giving of any such notice):
(i) declare the Total Commitment terminated, whereupon the Commitments of each
Lender shall forthwith terminate immediately and any Fees shall forthwith become
due and payable without any other notice of any kind; (ii) declare the principal
of and any accrued interest in respect of all Loans and all obligations owing
hereunder to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower; (iii) terminate any Letter of Credit which
may be terminated in accordance with its terms; (iv) direct the Borrower to pay
(and the
-81-
<PAGE>
Borrower agrees that upon receipt of such notice, or upon the occurrence of an
Event of Default specified in Section 10.05 with respect to the Borrower, it
will pay) to the Collateral Agent at the Payment Office such additional amount
of cash or Cash Equivalents, to be held as security by the Collateral Agent, as
is equal to the aggregate Stated Amount of all Letters of Credit issued for the
account of the Borrower and then outstanding; and (v) enforce, as Collateral
Agent (or direct the Collateral Agent to enforce), any and all of the Liens and
security interests created pursuant the Credit Documents (including with respect
to any cash collateral held pursuant to this Agreement); provided that during
Phase I only and (A) within three Business Days after the date of any Event of
Default that occurs due to noncompliance with Section 9.05, Parent may cure such
an Event of Default by making a cash contribution to the Borrower in an amount
equal to the greater of (I) the amount equal to the margin of such noncompliance
and (II) that amount necessary to reduce the Borrower's Consolidated Senior Debt
to Capitalization Ratio to no greater than .50 and (B) within three Business
Days after the date of any Event of Default that occurs due to noncompliance
with Section 9.12, Parent may cure such an Event of Default by making a cash
contribution in an amount equal to the margin of such noncompliance (the "EBITDA
Cure"), provided that the EBITDA Cure may only be used (I) two times during the
term of this Agreement if the Borrower's Consolidated Debt to Capitalization
Ratio (at all times measured at the end of the most recently reported fiscal
quarter of the Borrower) is less than .40 at the time of such Event of Default
and not in two consecutive fiscal quarters and (II) only one time during the
term of this Agreement if at the time of such Event of Default the Borrower's
Consolidated Debt to Capitalization Ratio is greater than or equal to .40 but
less than or equal to .50, except that if the Borrower has already exercised the
EBITDA Cure once in accordance with clause B (I) above, the Borrower may
exercise the EBITDA Cure once more pursuant to this clause B (II) (but only if
such EBITDA Cure is not exercised in two consecutive fiscal quarters).
Notwithstanding anything contained in clause (B) above, Parent may not make an
EBITDA Cure at any time if the Borrower's Consolidated Debt to Capitalization
Ratio is greater than .50 at the time of an Event of Default due to
noncompliance with Section 9.12; provided further that to the extent that Parent
makes a Parent Investment as defined in and pursuant to the Amended and Restated
Preferred Stock Issuance and Capital Contribution Agreement, the Default or
Event of Default that gave rise to the right of Parent to make a Parent
Investment shall automatically be deemed cured; except that (x) after two Parent
Investments have been made (which can be made regardless of the percentage that
the margin of noncompliance exceeds a Specified Event of Default as defined in
the Amended and Restated Preferred Stock Issuance and Capital Contribution
Agreement) Parent may not make Parent Investments as described in the above
proviso to cure such Specified Events of Default in which the margin of
noncompliance therewith exceeds 15% and (y) Parent may not make Parent
Investments to cure Specified Events of Default as described in the above
proviso in two consecutive reporting periods of the Borrower until after such
time that two Parent Investments have been made.
SECTION 11. THE ADMINISTRATIVE AGENT.
11.01 APPOINTMENT. The Lenders hereby designate First Union as
Administrative Agent (for purposes of this Section 11, the term "Administrative
Agent" shall include First Union in its capacity as Collateral Agent pursuant to
the Security Documents and as representative on behalf of the Lenders) to act as
specified herein and in the other Credit Documents. Each Lender hereby
irrevocably authorizes, and each holder of any Loan shall be
-82-
<PAGE>
deemed irrevocably to authorize, the Administrative Agent to take such action on
its behalf under the provisions of this Agreement, the other Credit Documents
and any other instruments and agreements referred to herein or therein and to
exercise such powers and to perform such duties hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent by the terms
hereof and thereof and such other powers as are reasonably incidental thereto.
The Administrative Agent may perform any of its duties hereunder by or through
its respective officers, directors, agents, employees or affiliates.
11.02 NATURE OF DUTIES. The Administrative Agent shall not
have any duties or responsibilities except those expressly set forth in this
Agreement and in the other Credit Documents. Neither the Administrative Agent
nor or any of its respective officers, directors, agents, employees or
affiliates shall be liable for any action taken or omitted by them hereunder or
under any other Credit Document or in connection herewith or therewith, unless
caused by their gross negligence or willful misconduct. The duties of the
Administrative Agent shall be mechanical and administrative in nature; the
Administrative Agent shall not have by reason of this Agreement or any other
Credit Document a fiduciary relationship in respect of any Lender or the holder
of any Loan; and nothing in this Agreement or any other Credit Document,
expressed or implied, is intended to or shall be so construed as to impose upon
the Administrative Agent any obligations in respect of this Agreement or any
other Credit Document except as expressly set forth herein or therein.
11.03 LACK OF RELIANCE ON THE ADMINISTRATIVE AGENT.
Independently and without reliance upon the Administrative Agent, each Lender
and the holder of each Loan, to the extent it deems appropriate, has made and
shall continue to make (i) its own independent investigation of the financial
condition and affairs of the Borrower and its Subsidiaries in connection with
the making and the continuance of the Loans and the taking or not taking of any
action in connection herewith and (ii) its own appraisal of the creditworthiness
of the Borrower and its Subsidiaries and, except as expressly provided in this
Agreement and the Administrative Agent shall not have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
or the holder of any Loan with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter. The Administrative Agent shall not be responsible
to any Lender or the holder of any Loan for any recitals, statements,
information, representations or warranties herein or in any document,
certificate or other writing delivered in connection herewith or for the
execution, effectiveness, genuineness, validity, enforceability, perfection,
collectibility, priority or sufficiency of this Agreement or any other Credit
Document or the financial condition of the Borrower and its Subsidiaries or be
required to make any inquiry concerning either the performance or observance of
any of the terms, provisions or conditions of this Agreement or any other Credit
Document, or the financial condition of the Borrower and its Subsidiaries or the
existence or possible existence of any Default or Event of Default.
11.04 CERTAIN RIGHTS OF THE ADMINISTRATIVE AGENT. If the
Administrative Agent shall request instructions from the Required Lenders with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Required Lenders;
and the
-83-
<PAGE>
Administrative Agent shall not incur liability to any Person by reason of so
refraining. Without limiting the foregoing, neither any Lender nor the holder of
any Loan shall have any right of action whatsoever against the Administrative
Agent as a result of the Administrative Agent acting or refraining from acting
hereunder or under any other Credit Document in accordance with the instructions
of the Required Lenders.
11.05 RELIANCE. The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype, facsimile or
telecopier message, cablegram, radiogram, order or other document or telephone
message signed, sent or made by any Person that the Administrative Agent
believed to be the proper Person, and, with respect to all legal matters
pertaining to this Agreement and any other Credit Document and its duties
hereunder and thereunder, upon advice of counsel selected by the Administrative
Agent (which may include counsel to the Borrower).
11.06 INDEMNIFICATION. To the extent the Administrative Agent
is not reimbursed and indemnified by the Borrower, each Defaulting Lender (to
the extent so able) and the Non-Defaulting Lenders will reimburse and indemnify
the Administrative Agent, in proportion to their respective Loans and
Commitments, for and against any and all liabilities, obligations, losses,
damages, penalties, claims, actions, judgments, costs, expenses or disbursements
of whatsoever kind or nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its respective duties
hereunder or under any other Credit Document, in any way relating to or arising
out of this Agreement or any other Credit Document; 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 gross negligence or willful misconduct of the Administrative
Agent.
11.07 THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
With respect to its obligation to make Loans under this Agreement, the
Administrative Agent shall have the rights and powers specified herein for a
"Lender" and may exercise the same rights and powers as though it were not
performing the duties specified herein; and the term "Lenders," "Required
Lenders," "holders of Loans" or any similar terms shall, unless the context
clearly otherwise indicates, include the Administrative Agent in its individual
capacity. The Administrative Agent may accept deposits from, lend money to, and
generally engage in any kind of banking, trust or other business with any Credit
Party or any Affiliate of any Credit Party as if it were not performing the
duties specified herein, and may accept fees and other consideration from the
Borrower, or any other Credit Party for services in connection with this
Agreement and otherwise without having to account for the same to the Lenders.
11.08 HOLDERS OF NOTES. The Administrative Agent may deem and
treat the payee of any Note as the owner thereof for all purposes hereof unless
and until a written notice of the assignment, transfer or endorsement thereof,
as the case may be, shall have been filed with the Administrative Agent. Any
request, authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is the holder of any Note shall be
conclusive and binding on any subsequent holder, transferee, assignee or
indorsee, as the case may be, of such Note or of any Note or Notes issued in
exchange therefor.
-84-
<PAGE>
11.09 RESIGNATION BY THE ADMINISTRATIVE AGENT. (a) The
Administrative Agent may resign from the performance of all its functions and
duties hereunder and/or under the other Credit Documents at any time by giving
15 Business Days' prior written notice to the Borrower and the Lenders. Such
resignation shall take effect upon the appointment of a successor Administrative
Agent pursuant to clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Required Lenders
shall appoint a successor Administrative Agent hereunder or thereunder who shall
be a commercial bank or trust company acceptable to the Borrower (such consent
not to be unreasonably withheld).
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the Administrative Agent, with the
consent of the Borrower (such consent not to be unreasonably withheld), shall
then appoint a successor Administrative Agent who shall serve as Administrative
Agent hereunder or thereunder until such time, if any, as the Required Lenders
appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed
pursuant to clause (b) or (c) above by the 30th Business Day after the date such
notice of resignation was given by the Administrative Agent, the Administrative
Agent's resignation shall become effective and the Required Lenders shall
thereafter perform all the duties of the Administrative Agent hereunder and/or
under any other Credit Document until such time, if any, as the Required Lenders
appoint a successor Administrative Agent as provided above.
11.10 BANK OF AMERICA. The provisions of Section 11 of the
Existing Credit Agreement shall inure to the benefit of Bank of America in its
capacity as administrative agent under the Existing Credit Agreement with
respect to any actions taken or omitted to be taken by it while it was acting as
administrative agent under the Existing Credit Agreement. In addition, Bank of
America, in its capacity as Syndication Agent under this Agreement, shall have
all the benefits and immunities provided to the Administrative Agent in this
Section 11 with respect to any acts taken or omissions suffered by the
Syndication Agent which are permitted to be taken by it, or omitted to be taken
by it, as provided for in this Agreement, in each case as fully as if the term
"Administrative Agent" included the Syndication Agent with respect to such acts
or omissions.
SECTION 12. MISCELLANEOUS.
12.01 PAYMENT OF EXPENSES, ETC. The Borrower agrees to: (i)
whether or not the transactions herein contemplated are consummated, pay all
reasonable out-of-pocket costs and expenses of each Agent in connection with the
negotiation, preparation, execution and delivery of the Credit Documents and the
documents and instruments referred to therein and any amendment, waiver or
consent relating thereto (including, without limitation, the reasonable fees and
disbursements of White & Case LLP) and of each Agent and each of the Lenders in
connection with the enforcement following an Event of Default of the Credit
Documents and the documents and instruments referred to therein (including,
without limitation, the reasonable fees and disbursements of counsel for each of
the Agents and each of the Lenders); (ii) pay and hold each of the Lenders
harmless from and against any and all present and future stamp and other
-85-
<PAGE>
similar taxes with respect to the foregoing matters and save each of the Lenders
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission (other than to the extent attributable to such
Lender) to pay such taxes; and (iii) indemnify each Lender (including in its
capacity as an Agent), its officers, directors, employees, representatives and
agents from and hold each of them harmless against any and all losses,
liabilities, claims, damages or expenses incurred by any of them as a result of,
or arising out of, or in any way related to, or by reason of, (a) any
investigation, litigation or other proceeding (whether or not any Agent or any
Lender is a party thereto and whether or not any such investigation, litigation
or other proceeding is between or among any Agent, any Lender, any Credit Party
or any third Person or otherwise (except to the extent between or among any
Lenders in their capacity as such)) related to the entering into and/or
performance of any Credit Document or the use of the proceeds of any Loans
hereunder or the consummation of any transactions contemplated in any Credit
Document, or (b) the actual or alleged presence of Hazardous Materials in the
air, surface water or ground water or on the surface or subsurface of any
property owned or operated at any time by Borrower or any of its Subsidiaries or
the generation, storage, transportation, handling or disposal of Hazardous
Materials by the Borrower or any of its Subsidiaries at any location, or the
noncompliance by the Borrower or any of its Subsidiaries with any Environmental
Law or any Environmental Claim in connection with the Borrower or any of its
Subsidiaries or business or operations or any property owned or operated at any
time by the Borrower or any of its Subsidiaries, including, in each case,
without limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding (but
excluding any such losses, liabilities, claims, damages or expenses to the
extent incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified or of any other indemnitee who is such Person or an
affiliate of such Person). Notwithstanding the foregoing, in no event shall the
Borrower be obligated under this Section 12.01 to indemnify any Lender (i) for a
loss in value of Parent Preferred Stock taken by such Lender pursuant to the
Parent Conversion Option and (ii) for such Lender's failure to comply with
Regulation Y.
12.02 RIGHT OF SETOFF. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, if an Event of Default then exists, each Lender
is hereby authorized at any time or from time to time, without presentment,
demand, protest or other notice of any kind to any Credit Party or to any other
Person, any such notice being hereby expressly waived, to set off and to
appropriate and apply any and all deposits (general or special but not trust
accounts) and any other Indebtedness at any time held or owing by such Lender
(including, without limitation, by branches and agencies of such Lender wherever
located) to or for the credit or the account of any Credit Party against and on
account of the Obligations and liabilities of such Credit Party to such Lender
under this Agreement or under any of the other Credit Documents, including,
without limitation, all interests in Obligations of such Credit Party purchased
by such Lender pursuant to Section 12.06(b), and all other claims of any nature
or description arising out of or connected with this Agreement or any other
Credit Document, irrespective of whether or not such Lender shall have made any
demand hereunder and although said Obligations, liabilities or claims, or any of
them, shall be contingent or unmatured.
12.03 NOTICES. Except as otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including facsimile
-86-
<PAGE>
communication) and mailed, faxed or delivered, if to the Borrower at the address
specified opposite its signature below, if to any Lender, at its address
specified for such Lender on Annex II hereto; or, at such other address as shall
be designated by any party in a written notice to the other parties hereto. All
such notices and communications shall be effective when received.
12.04 BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPANTS. (a)
This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the parties hereto,
PROVIDED that the Borrower may not assign or transfer any of its rights or
obligations hereunder without the prior written consent of the Lenders. Each
Lender may at any time grant participations in any of its rights hereunder or
under any of the Loans to another financial institution, provided that in the
case of any such participation, the participant shall not have any rights under
this Agreement or any of the other Credit Documents (the participant's rights
against such Lender in respect of such participation to be those set forth in
the agreement executed by such Lender in favor of the participant relating
thereto) and all amounts payable by the Borrower hereunder shall be determined
as if such Lender had not sold such participation, except that the participant
shall be entitled to the benefits of Sections 2.10 and 5.04 to the extent that
such Lender would be entitled to such benefits if the participation had not been
entered into or sold, and, provided further, that no Lender shall transfer,
grant or assign any participation under which the participant shall have rights
to approve any amendment to or waiver of this Agreement or any other Credit
Document except to the extent such amendment or waiver would (i) extend the
final scheduled maturity of any Loan in which such participant is participating
(it being understood that any waiver of any prepayment of, or the method of any
application of any prepayment to, the Loans shall not constitute an extension of
the final maturity date), or reduce the rate or extend the time of payment of
interest or Fees (except in connection with a waiver of the applicability of any
post-default increase in interest rates), or reduce the principal amount
thereof, or increase such participant's participating interest in the Total
Commitment over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default or of a mandatory reduction in the
Total Commitment or a mandatory prepayment shall not constitute a change in the
terms of any Commitment), (ii) release all or substantially all of the
Collateral or Subsidiary Guarantors or (iii) consent to the assignment or
transfer by the Borrower of any of its rights and obligations under this
Agreement.
(b) Notwithstanding the foregoing, with the consent of the
Administrative Agent and, if no Default under Section 10.01, 10.05 or 10.03(b)
or Event of Default exists, the Borrower (each of which consents shall not be
unreasonably withheld, provided that no such consent shall be required in
connection with an assignment pursuant to clause (x) below), (x) any Lender may
assign all or a portion of its Commitments (and related obligations) and related
rights and Obligations (or, if the Commitments with respect to the relevant
Tranche have terminated, outstanding Obligations) hereunder to (i) one or more
Lenders and/or Affiliates of such Lender which are Eligible Transferees or (ii)
in the case of any Lender that is a fund that invests in loans, any other fund
that invests in loans and is managed and/or advised
-87-
<PAGE>
by the same investment advisor of such Lender or by an Affiliate of such
investment advisor, and (y) any Lender may assign all or a portion of its
Commitments (and related obligations) and related rights and Obligations (or, if
the Commitments with respect to the relevant Tranche have terminated,
outstanding Obligations) hereunder to one or more Eligible Transferees (treating
any fund that invests in loans and any other fund that invests in loans and is
managed and/or advised by the same investment advisor of such fund or by an
Affiliate of such investment advisor of such fund or by an Affiliate of such
investment advisor as a single Eligible Transferee). No assignment pursuant to
the immediately preceding sentence shall, to the extent such assignment
represents an assignment to an institution other than one or more Lenders
hereunder or an Affiliate thereof, be in an aggregate amount less than
$5,000,000 unless the entire Commitments and Loans of the assigning Lender is so
assigned. If any Lender so sells or assigns all or a part of its rights
hereunder or under the Notes, any reference in this Agreement or the Notes to
such assigning Lender shall thereafter refer to such Lender and to the
respective assignee to the extent of their respective interests and the
respective assignee shall have, to the extent of such assignment (unless
otherwise provided therein), the same rights and benefits as it would if it were
such assigning Lender. Each assignment pursuant to this Section 12.04(b) shall
be effected by the assigning Lender and the assignee Lender executing an
Assignment Agreement and giving the Administrative Agent written notice thereof.
At the time of any such assignment, (i) either the assigning or the assignee
Lender shall pay to the Administrative Agent a nonrefundable assignment fee of
$3,500, (ii) Annex I shall be deemed to be amended to reflect the Commitments
and/or outstanding Loans of the respective assignee (which shall result in a
direct reduction to the Commitment of the respective Tranche or Tranches of the
assigning Lender) and of the other Lenders, and (iii) upon surrender of any
related old Notes the Borrower will, at its own expense, issue new Notes to the
respective assignee and to the assigning Lender in conformity with the
requirements of Section 2.05, PROVIDED FURTHER that such transfer or assignment
will not become effective until recorded by the Administrative Agent on the
Lender Register pursuant to Section 12.16. To the extent of any assignment
pursuant to this Section 12.04(b) to a Person which is not already a Lender
hereunder and which is not a United States Person (as such term is defined in
Section 7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Lender shall provide to the Borrower and the Administrative Agent the
appropriate Internal Revenue Service Forms (and, if applicable, a Section 5.04
Certificate) described in Section 5.04(b). To the extent that an assignment
pursuant to this Section 12.04(b) would, at the time of such assignment, result
in increased costs under Section 2.10 or 5.04 from those being charged by the
respective assigning Lender prior to such assignment, then the Borrower shall
not be obligated to pay such increased costs (although the Borrower shall be
obligated to pay any other increased costs of the type described above resulting
from changes after the date of the respective assignment). Nothing in this
clause (b) shall prevent or prohibit any Lender from pledging its Notes or Loans
to a Federal Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank and, with the consent of the Administrative Agent and the
Borrower (each of which consents shall not be unreasonably withheld), any Lender
which is a fund may pledge all or any portion of its Loans and Notes to its
trustee in support of its obligations to its trustee.
(c) Notwithstanding any other provisions of this Section
12.04, no transfer or assignment of the interests or obligations of any Lender
hereunder or any grant of participation therein shall be permitted if such
transfer, assignment or grant would require the Borrower or any of its
Subsidiaries to (i) file a registration statement with the SEC, (ii) qualify the
Loans under the "Blue Sky" laws of any State or (iii) integrate such transfer or
assignment with a separate securities offering of securities of the Borrower or
any of its Subsidiaries.
-88-
<PAGE>
(d) Each Lender initially party to this Agreement hereby
represents, and each Person that became a Lender pursuant to an assignment
permitted by this Section 12 will, upon its becoming party to this Agreement,
represent that it is an Eligible Transferee which makes or invests in loans in
the ordinary course of its business and that it will make or acquire Loans for
its own account in the ordinary course of such business, PROVIDED that subject
to the preceding clauses (a) and (b), the disposition of any promissory notes or
other evidences of or interests in Indebtedness held by such Lender shall at all
times be within its exclusive control.
12.05 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of the Administrative Agent or any Lender in exercising any right,
power or privilege hereunder or under any other Credit Document and no course of
dealing between any Credit Party and the Administrative Agent or any Lender
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, power or privilege hereunder or under any other Credit Document
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder or thereunder. The rights and remedies
herein expressly provided are cumulative and not exclusive of any rights or
remedies which the Administrative Agent or any Lender would otherwise have. No
notice to or demand on any Credit Party in any case shall entitle any Credit
Party to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the rights of the Administrative Agent or the Lenders
to any other or further action in any circumstances without notice or demand.
12.06 PAYMENTS PRO RATA. (a) The Administrative Agent agrees
that promptly after its receipt of each payment from or on behalf of any Credit
Party in respect of any Obligations of such Credit Party hereunder, it shall
distribute such payment to the Lenders (other than any Lender that has expressly
waived its right to receive its pro rata share thereof) PRO RATA based upon
their respective shares, if any, of the Obligations with respect to which such
payment was received.
(b) Each of the Lenders agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees
or other Fees, of a sum which with respect to the related sum or sums received
by other Lenders is in a greater proportion than the total of such Obligation
then owed and due to such Lender bears to the total of such Obligation then owed
and due to all of the Lenders immediately prior to such receipt, then such
Lender receiving such excess payment shall purchase for cash without recourse or
warranty from the other Lenders an interest in the Obligations of the respective
Credit Party to such Lenders in such amount as shall result in a proportional
participation by all of the Lenders in such amount, PROVIDED that if all or any
portion of such excess amount is thereafter recovered from such Lender, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein,
the provisions of the preceding Sections 12.06(a) and (b) shall be subject to
the express provisions of this
-89-
<PAGE>
Agreement which require, or permit, differing payments to be made to
Non-Defaulting Lenders as opposed to Defaulting Lenders.
12.07 CALCULATIONS; COMPUTATIONS. (a) The financial statements
to be furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Borrower to the Lenders), provided that (x) except as otherwise
specifically provided herein, all computations determining compliance with
Sections 9.11 through 9.17, inclusive, including definitions used therein, and
all computations of Excess Cash Flow, shall utilize accounting principles and
policies in conformity with those used to prepare the historical financial
statements of the Borrower referred to in Section 7.10 and (y) that if at any
time such computations utilize accounting principles different from those
utilized in the financial statements furnished to the Lenders, such financial
statements shall be accompanied by reconciliation work-sheets.
(b) All computations of interest and Fees hereunder shall be
made on the actual number of days elapsed over a year of 360 days (365-366 days
in the case of interest on Base Rate Loans).
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL. (a) This Agreement and the other Credit Documents and the rights
and obligations of the parties hereunder and thereunder shall be construed in
accordance with and be governed by the law of the State of New York. Any legal
action or proceeding with respect to this Agreement or any other Credit Document
may be brought in the courts of the State of New York sitting in the Borough of
Manhattan or of the United States for the Southern District of New York, and, by
execution and delivery of this Agreement, each Credit Party hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. Each Credit Party
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to each Credit Party
located outside New York City and by hand delivery to each Credit Party located
within New York City, at its address for notices pursuant to Section 12.03, such
service to become effective 30 days after such mailing. Nothing herein shall
affect the right of the Administrative Agent, any Lender to serve process in any
other manner permitted by law or to commence legal proceedings or otherwise
proceed against any Credit Party in any other jurisdiction.
(b) Each Credit Party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Agreement or any other Credit Document brought in the courts referred to in
clause (a) above and hereby further irrevocably waives and agrees not to plead
or claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum.
(c) Each of the parties to this Agreement hereby irrevocably
waives all right to a trial by jury in any action, proceeding or counterclaim
arising out of or relating to this Agreement, the other Credit Documents or the
transactions contemplated hereby or thereby.
-90-
<PAGE>
12.09 COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Administrative Agent.
12.10 EFFECTIVENESS. This Agreement shall become effective on
the date (the "Restatement Effective Date") on which (i) the Borrower and each
of the Lenders shall have signed a counterpart hereof (whether the same or
different counterparts) and shall have delivered the same to the Administrative
Agent at the Notice Office of the Administrative Agent or, in the case of the
Lenders, shall have given to the Administrative Agent telephonic (confirmed in
writing), written telex or facsimile transmission notice (actually received) at
such office that the same has been signed and mailed to it and (ii) the
conditions set forth in Section 6.01 shall have been satisfied in accordance
with the terms thereof. The Administrative Agent will give the Borrower and each
Lender prompt written notice of the occurrence of the Restatement Effective
Date.
12.11 HEADINGS DESCRIPTIVE. The headings of the several
sections and subsections of this Agreement are inserted for convenience only and
shall not in any way affect the meaning or construction of any provision of this
Agreement.
12.12 AMENDMENT OR WAIVER. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the Borrower and the Required Lenders, provided that no
such change, waiver, discharge or termination shall, without the consent of each
Lender (other than a Defaulting Lender) directly affected thereby, (i) extend
the final scheduled maturity date of any Loan or Note or extend the stated
expiration date of any Letter of Credit beyond the Final Maturity Date, or
reduce the rate or extend the time of payment of interest (other than as a
result of waiving the applicability of any post-default increase in interest
rates) or Fees, or reduce the principal amount thereof, or increase any
Commitment of such Lender over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or of a mandatory
reduction in the Total Commitment shall not constitute a change in the terms of
any Commitment of any Lender), (ii) amend, modify or waive any provision of this
Section 12.12 (except to give effect to additional facilities hereunder), (iii)
reduce the percentage specified in, or (except to give effect to any additional
facilities hereunder) otherwise modify, the definition of Required Lenders, (iv)
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement, (v) release all or substantially all of the
Collateral (except as set forth in the Credit Documents) or (vi) release all or
substantially all of the Subsidiary Guarantor; PROVIDED FURTHER, that no such
change, waiver, discharge or termination shall, (w) without the consent of the
Issuing Lender, amend, modify or waive any provision of Section 3 or alter its
rights or obligations with respect to Letters of Credit, (x) without the consent
of each Agent affected thereby, amend, modify or waive any provision of Section
11 or any other provision as same relates to the rights or obligations of such
Agent or (y) without the consent of the Collateral Agent, amend, modify or waive
any provision relating to the rights or obligations of the Collateral Agent.
-91-
<PAGE>
(b) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by clauses (i) through (v), inclusive, of the first proviso to
Section 12.12(a), the consent of the Required Lenders is obtained but the
consent of one or more of such other Lenders whose consent is required is not
obtained, then the Borrower shall have the right, so long as all non-consenting
Lenders whose individual consent is required are treated as described in either
clauses (A) or (B) below, to either (A) replace each such non-consenting Lender
or Lenders with one or more Replacement Lenders pursuant to Section 2.13 so long
as at the time of such replacement, each such Replacement Lender consents to the
proposed change, waiver, discharge or termination or (B) terminate such
non-consenting Lender's Commitments and/or repay the outstanding Loans of such
Lender in accordance with Sections 4.02(c) and/or 5.01(b), PROVIDED that, unless
the Commitments that are terminated, and Loans repaid, pursuant to preceding
clause (B) are immediately replaced in full at such time through the addition of
new Lenders or the increase of the Commitments and/or outstanding Loans of
existing Lenders (who in each case must specifically consent thereto), then in
the case of any action pursuant to preceding clause (B) each Lender (determined
after giving effect to the proposed action) shall specifically consent thereto,
PROVIDED FURTHER, that in any event the Borrower shall not have the right to
replace a Lender, terminate any of its Commitments or repay its Loans solely as
a result of the exercise of such Lender's rights (and the withholding of any
required consent by such Lender) not to increase its Commitments.
12.13 SURVIVAL. All indemnities set forth herein including,
without limitation, in Section 2.10, 2.11, 5.04, 11.06 or 12.01 shall survive
the execution and delivery of this Agreement and the making and repayment of the
Loans.
12.14 DOMICILE OF REVOLVING LOANS. Each Lender may transfer
and carry its Loans at, to or for the account of any branch office, subsidiary
or affiliate of such Lender, provided that the Borrower shall not be responsible
for costs arising under Section 2.10 or 5.04 resulting from any such transfer
(other than a transfer pursuant to Section 2.12) to the extent not otherwise
applicable to such Lender prior to such transfer.
12.15 CONFIDENTIALITY. Each of the Lenders agrees that it will
use its best efforts not to disclose without the prior consent of the Borrower
(other than to its employees, auditors, counsel or other professional advisors,
to affiliates or to another Lender if the Lender or such Lender's holding or
parent company in its sole discretion determines that any such party should have
access to such information) any information with respect to the Borrower or any
of its Subsidiaries which is furnished pursuant to any Credit Document and which
is designated by the Borrower or the Borrower to the Lenders in writing as
confidential; provided, that any Lender may disclose any such information (a) as
has become generally available to the public, (b) as may be required or
appropriate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdiction over
such Lender or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or elsewhere)
or their successors or to the National Association of Insurance Commissioners,
(c) as may be required or appropriate in response to any summons or subpoena or
in connection with any litigation (notice of which will be promptly sent to the
Borrower to the extent permitted by law), (d) in order to comply with any law,
order, regulation or ruling applicable to such Lender, and (e) to any
prospective transferee that is an Eligible
-92-
<PAGE>
Transferee that is acceptable to the Borrower in connection with any
contemplated transfer of any of the Notes or any interest therein by such Lender
to the extent that such prospective transferee is notified of the
confidentiality requirements relating thereto. No Lender shall be obligated or
required to return any materials furnished by the Borrower or any Subsidiary of
the Borrower. The Borrower hereby agrees that the failure of a Lender to comply
with the provisions of this Section 12.15 shall not relieve the Credit Parties
of any of their obligations to such Lender under this Agreement and the other
Credit Documents.
12.16 LENDER REGISTER. The Borrower hereby designates the
Administrative Agent to serve as the Borrower's agent, solely for purposes of
this Section 12.16, to maintain a register (the "Lender Register") on which it
will record the Commitments from time to time of each of the Lenders, the Loans
made by each of the Lenders and each repayment in respect of the principal
amount of the Loans of each of the Lenders. Failure to make any such
recordation, or any error in such recordation shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Lender, the transfer
of such Commitments and the rights to the principal of, and interest on, such
Loans made pursuant to such Commitments shall not be effective until such
transfer is recorded on the Lender Register maintained by the Administrative
Agent with respect to ownership of such Commitments and Loans and prior to such
recordation all amounts owing to the transferor with respect to such Commitments
and Loans shall remain owing to the transferor. The registration of assignment
or transfer of all or part of any Commitment and Loans shall be recorded by the
Administrative Agent on the Lender Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment Agreement
pursuant to Section 12.04(b). The Borrower agrees to indemnify the
Administrative Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its duties under this Section
12.16 (but excluding such losses, claims, liabilities or liabilities incurred by
reason of the Administrative Agent's gross negligence or willful misconduct).
12.17 AMENDMENT AND RESTATEMENT OF EXISTING CREDIT AGREEMENT.
On and as of the occurrence of the Restatement Effective Date in accordance with
Section 12.10, the Existing Credit Agreement shall be deemed to be amended and
restated in its entirety, and superseded by this Agreement.
-93-
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the date
first above written.
Address: FAIRPOINT COMMUNICATIONS
SOLUTIONS CORP.
FairPoint Communications Solutions
Corp.
c/o Fairpoint Communications, Inc.
521 E. Morehead Street By /s/ TIMOTHY W. HENRY
Suite 250 ---------------------------
Charlotte, NC 28210 Title: Vice President of
Attention: Vice President of Finance and Treasurer
Finance/Treasurer
FIRST UNION NATIONAL BANK,
Individually and as
Administrative Agent
By: /s/ KATHERINE A. HARKNESS
-----------------------------
Name: Katherine A. Harkness
Title: Vice President
BANK OF AMERICA, N.A., Individually and
as Syndication Agent
By: /s/ ROSELYN DRAKE
---------------------------
Name: Roselyn Drake
Title: Managing Director
BANKERS TRUST COMPANY, Individually
and as Documentation Agent
By: /s/ ANCA TRIFAN
---------------------------
Name: Anca Trifan
Title: Director
-94-
<PAGE>
CIT GROUP/EQUIPMENT FINANCING, INC.
By: /s/ JOHN P. SINICO
---------------------------
Name: John P. Sinico
Title: Vice President
CITICORP USA, INC.
By: /s/ J. DOUGLAS HARVEY
---------------------------
Name: J. Douglas Harvey
Title: Managing Director
COBANK, ACB
By: /s/ TERESA L. FOUNTAIN
---------------------------
Name: Teresa L. Fountain
Title: Assistant Corporate Secretary
DLJ CAPITAL FUNDING, INC.
By: /s/ EUGENE F. MARTIN
---------------------------
Name: Eugene F. Martin
Title: Senior Vice President
-95-
<PAGE>
ANNEX I
COMMITMENTS
LENDER REVOLVING COMMITMENT TERM COMMITMENt
------ -------------------- --------------
First Union National Bank $15,000,000 $35,000,000
Bank of America, N.A. $15,000,000 $35,000,000
Bankers Trust Company $15,000,000 $35,000,000
Citicorp USA, Inc. $12,000,000 $28,000,000
DLJ Capital Funding, Inc. $12,000,000 $28,000,000
CoBank, ACB $3,000,000 $7,000,000
CIT Group/Equipment
Financing, Inc. $3,000,000 $7,000,000
TOTAL: $75,000,000 $175,000,000
-96-
<PAGE>
ANNEX II
ADDRESSES
LENDER ADDRESS
------ -------
First Union National Bank 201 South College Street
Charlotte, North Carolina 28288
ATTN: Brand Hosford
Tel. No.: (704) 374-6355
Fax No.: (704) 374-4793
Bank of America, N.A. 901 Main Street, 64th Floor
Dallas, TX 75202-3748
ATTN: Pam Kurtzman
Tel. No.: (214) 209-0997
Fax No.: (214) 209-9390
Bankers Trust Company 130 Liberty Street
New York, NY 10006
ATTN: Anca Trifan
Tel No.: (212) 250-7448
Fax No.: (212) 250-7218
Citicorp USA, Inc. 390 Greenwich Street, First Floor
New York, NY 10013
ATTN: James P. Garvin
Tel No.: (212) 723-6662
Fax No.: (212) 723-8547
DLJ Capital Funding, Inc. 2775 Park Avenue 9th Floor
New York, NY 10172
ATTN: Don Pollard
Tel No.: (212) 892-2403
Fax No.: (212) 892-5286
CoBank, ACB 900 Circle 75 Parkway Suite 1400
Atlanta, GA 30339
ATTN: Rick Freeman
Tel No. (770) 618-3221
Fax No. (770) 618-3260
CIT Group/Equipment Financing, Inc. 44 Whippany Road
Morristown, NJ 07962
-97-
<PAGE>
ATTN: Bill Evenson
Tel No.: (973) 401-6727
Fax No.: (973) 401-6785
-98-
