===============================================================================
As filed with the Securities and Exchange Commission on July 2, 1998
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
Amendment No. 1
to
SCHEDULE 13E-3
Rule l3e-3 Transaction Statement (Pursuant to Section
13(e) of the Securities Exchange Act of 1934)
PRICELLULAR CORPORATION
(Name of Issuer)
PriCellular Corporation
American Cellular Corporation
Spectrum Equity Investors, L.P.
Brion Applegate
(Name of Person(s) Filing Statement)
Class A Common Stock, $.01 par value
Class B Common Stock, $.01 par value
(Title of Class of Securities)
74150410
(CUSIP Number of Class of Securities)
-------------
Brion Applegate Brian McTernan
Spectrum Equity Investors, L.P. American Cellular Corporation
245 Lytton Avenue, Suite 175 (formerly PriCellular Corporation)
Pal Alto, CA 94301 1336 Basswood, Suite F
(415) 464-4600 Schaumburg, Illinois 60173
(847) 843-9081
(Name, Address and Telephone Number of Persons Authorized to Receive Notices
and Communications on Behalf of Person(s) Filing Statement)
--------------
Copies to:
Scott Haber
Latham & Watkins
505 Montgomery Street, 19th Floor
San Francisco, CA 94111
(415) 395-8137
--------------
June 2, 1998
(Date Information Statement First Published, Sent, or Given to Securityholders)
THIS STATEMENT IS FILED IN CONNECTION WITH (CHECK THE APPROPRIATE BOX):
a. [X] The filing of solicitation materials or an information statement
subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the
Securities Exchange Act of 1934.
b. [ ] The filing of a registration statement under the Securities Act of 1933.
c. [ ] A tender offer.
d. [ ] None of the above.
Check the following box if the soliciting materials or
information statement referred to in checking box (a) are preliminary
copies: [X]
--------------
CALCULATION OF FILING FEE
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TRANSACTION VALUATION AMOUNT OF FILING FEE
- -------------------------------------------------------------------------------
$810,791,740.99(1) $162,158.35
===============================================================================
(1) The amount on which the filing fee was calculated was determined as
described in PriCellular's Information Statement on Schedule 14C, which is
incorporated herein by reference.
[X] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form or
Schedule and the date of its filing.
1) Amount Previously Paid: $162,158.35
2) Form, Schedule or Registration Statement No.: Preliminary Schedule 14C
3) Filing Party: PriCellular Corporation
4) Date Filed: April 6, 1998
===============================================================================
This Rule 13E-3 Transaction Statement (the "Schedule 13E-3")
relates to the merger (the "Merger") between American Cellular Corporation
("ACC") and PriCellular Corporation ("PriCellular") pursuant to an Agreement and
Plan of Merger dated as of March 6, 1998 between ACC and PriCellular (the
"Merger Agreement"). This Schedule 13E-3 was originally filed jointly by
PriCellular, ACC, Spectrum Equity Investors, L.P. ("Spectrum") and Mr. Brion
Applegate. By filing this Schedule 13E-3, none of the joint signatories concedes
that Rule 13e-3 under the Securities Exchange Act of 1934 is applicable to the
Merger or the other transactions consummated pursuant to the Merger Agreement.
In the Merger, which was completed on June 25, 1998, ACC merged
with and into PriCellular, with PriCellular as the surviving corporation. The
surviving corporation then changed its name to "American Cellular
Corporation." At the effective time of the Merger, all issued and outstanding
shares of PriCellular Class A Common Stock and Class B Common Stock were
converted into the right to receive cash, at $14.00 per share (without
interest); all issued and outstanding shares of PriCellular Series A
Cumulative Convertible Preferred Stock were converted into the right to
receive an amount in cash equal to $14.00 (without interest) for each share of
common stock into which such preferred stock was convertible at the effective
time of the Merger. Trading in shares of PriCellular Class A Common Stock on
the American Stock Exchange ceased at the opening of trading on June 26, 1998.
Several of PriCellular's principal stockholders (certain
members of the Price family, AT&T Wireless Services, Inc. and The Thomas H.
Lee Company) approved the Merger on May 27, 1998 by signing a written
stockholders' consent pursuant to a voting agreement. Spectrum also approved
the Merger by signing a written consent. Since those stockholders controlled
more than 67% of the fully-diluted voting power of PriCellular, no further
vote was necessary to approve the Merger.
In connection with the Merger, PriCellular filed an Information
Statement on Schedule 14C (the "Information Statement" or the "Schedule 14C")
which was mailed to all holders of PriCellular stock. A copy of the Merger
Agreement is attached as Exhibit A to the Information Statement.
The cross reference sheet below is being supplied pursuant to
General Instruction F to Schedule 13E-3 and shows the location in the Schedule
14C of the information required to be included in response to the items of this
Statement. The information in the Schedule 14C, including all Exhibits
thereto, is hereby expressly incorporated herein by reference and the
responses to each item in this Statement are qualified in their entirety by the
information contained in the Schedule 14C.
CROSS REFERENCE SHEET
<TABLE>
Where located in
Item in Schedule 13E-3 Schedule 14C
- ---------------------- ----------------
<S> <C>
Item 1 (a).......................... Cover Page and "THE COMPANIES"
Item 1 (b).......................... Cover Page and "MARKET PRICE OF AND DIVIDENDS ON
PRICELLULAR COMMON STOCK"
Item 1(c)........................... "MARKET PRICE OF AND DIVIDENDS ON PRICELLULAR COMMON
STOCK"
Item 1 (d).......................... "MARKET PRICE OF AND DIVIDENDS ON PRICELLULAR COMMON
STOCK"
Item 1 (e).......................... **
Item 1(f)........................... "PURCHASES OF PRICELLULAR STOCK BY ACC AND THE
COMPANY"
Item 2.............................. "THE COMPANIES," "MANAGEMENT OF PRICELLULAR" and
"MANAGEMENT OF ACC"
Item 3(a)(1)........................ **
Item 3 (a)(2)....................... "THE MERGER--Background of the Merger"
Item 3 (b).......................... **
Item 4(a)........................... "THE MERGER," "THE MERGER AGREEMENT," "THE VOTING
AGREEMENT" and "SUMMARY"
Item 4(b)........................... "THE MERGER - Merger Consideration"
Item 5(a)-(g)....................... "THE MERGER--Conduct of Business After the Merger," "THE
MERGER--Certain Effects of the Merger" and "THE MERGER--Merger
Financing"
Item 6 (a).......................... "THE MERGER--Merger Financing" and "THE MERGER
AGREEMENT--High Yield Financing"
Item 6(b)........................... "THE MERGER--Expenses of the Transaction" and "THE MERGER
AGREEMENT--Expenses and Fees"
Item 6(c)........................... "THE MERGER--Merger Financing" and "THE MERGER
AGREEMENT--High Yield Financing"
Item 6(d)........................... **
Item 7 (a)-(c)...................... "THE MERGER--Background of the Merger," "THE
MERGER--Recommendation of the PriCellular Board; Reasons for the Merger"
and "THE MERGER--Purpose and Structure of the Transaction; Reasons of
ACC, Spectrum and Applegate for the Merger; Fairness of the Transaction"
Item 7 (d).......................... "THE MERGER--Recommendation of the PriCellular Board; Reasons for the
Merger," "THE MERGER--Certain Effects of the Merger" and "THE
MERGER--Certain Federal Income Tax Consequences"
Item 8(a)-(b)....................... "THE MERGER--Recommendation of the PriCellular Board; Reasons for the
Merger," "THE MERGER--Opinions of the Financial Advisors to the
PriCellular Board" and "THE MERGER--Purpose and Structure of the
Transaction; Reasons of ACC, Spectrum and Applegate for the Merger; Fairness
of the Transaction"
Item 8(c)........................... "THE VOTING AGREEMENT" and "SUMMARY"
Item 8(d)........................... "THE MERGER--Recommendation of the PriCellular Board; Reasons for the
Merger" and "THE MERGER--Opinions of the Financial Advisors to the
PriCellular Board"
Item 8(e)........................... "THE MERGER--Recommendation of the PriCellular Board; Reasons for the
Merger"
Item 8(f) **
Item 9.............................. "THE MERGER-- Recommendation of the PriCellular Board; Reasons for the
Merger," "THE MERGER--Opinions of the Financial Advisors to the
PriCellular Board" and "THE MERGER--Risks of Insolvency on Former
Stockholders of PriCellular"
Item 10............................. "SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL
STOCKHOLDERS OF PRICELLULAR" and "
Item 11............................. "THE MERGER--Interests of Certain Persons in the Merger," "THE VOTING
AGREEMENT" and "OTHER AGREEMENTS"
Item 12(a).......................... "THE VOTING AGREEMENT"
Item 12(b).......... "THE MERGER--Background of the Merger," "THE
MERGER--Recommendation of the PriCellular Board; Reasons for the Merger"
and "THE MERGER--Interests of Certain Persons in the Merger"
Item 13(a).......................... "APPRAISAL RIGHTS OF DISSENTING STOCKHOLDERS" and Appendix E
Item 13 (b) - (c)................... **
Item 14(a).......................... "SELECTED HISTORICAL FINANCIAL INFORMATION OF
PRICELLULAR" and "MARKET PRICE OF AND DIVIDENDS ON
PRICELLULAR COMMON STOCK"
Item 14(b).......................... **
Item 15(a).......................... "THE MERGER--Interests of Certain Persons in the Merger"
Item 15(b).......................... **
Item 16............................. "THE COMPANY," "THE MERGER," "THE MERGER AGREEMENT,"
"THE VOTING AGREEMENT," "OTHER AGREEMENTS" and "SECURITY
OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS OF
PRICELLULAR"
Item 17(a).......................... *
Item 17(b)(1)....................... Appendix C and Appendix D
Item 17(c)(1)....................... Appendix B
Item 17(d).......................... **
Item 17(e).......................... Appendix E
Item 17 (f)......................... **
</TABLE>
- -----------
* The information requested by this Item is not required to be included in
the Schedule 14C.
** The Item is inapplicable or the answer thereto is in the negative.
Item 1. Issuer and Class of Securities Subject to the Transaction.
(a) The information set forth in the Information Statement on
the cover page and under the caption "THE COMPANIES" is incorporated herein by
reference.
(b) The information set forth in the Information Statement on
the cover page and under the caption "MARKET PRICE OF AND DIVIDENDS ON
PRICELLULAR COMMON STOCK" is incorporated herein by reference.
(c) The information set forth in the Information Statement
under the caption "MARKET PRICE OF AND DIVIDENDS ON PRICELLULAR COMMON STOCK"
is incorporated herein by reference.
(d) The information set forth in the Information Statement
under the caption "MARKET PRICE OF AND DIVIDENDS ON PRICELLULAR COMMON STOCK"
is incorporated herein by reference.
(e) Not applicable.
(f) The information set forth in the Information Statement
under the caption "PURCHASES OF PRICELLULAR STOCK BY ACC AND THE COMPANY" is
incorporated herein by reference.
Item 2. Identity and Background.
(a)-(d) The information set forth in the Information Statement
under the captions "THE COMPANIES," "MANAGEMENT OF PRICELLULAR" and
"MANAGEMENT OF ACC" is incorporated herein by reference. One of the persons
filing this statement is the issuer of the class of equity securities which is
the subject of the Rule 13e-3 transaction.
(e)-(f) None of the persons with respect to whom information is
provided in response to this Item was, during the last five years, convicted
in a criminal proceeding (excluding traffic violations or similar
misdemeanors), or was, during the last five years, a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and
as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining further violations of, or prohibiting activities subject
to, Federal or state securities laws or finding any violation of such laws.
Item 3. Past Contacts, Transactions or Negotiations.
(a)(1) Not Applicable.
(a)(2) The information set forth in the Information Statement
under the caption "THE MERGER--Background of the Merger" is incorporated
herein by reference.
(b) Not applicable.
Item 4. Terms of the Transaction.
(a) The information set forth in the Information Statement
under the captions "THE MERGER," "THE MERGER AGREEMENT," "THE VOTING
AGREEMENT" and "SUMMARY" is incorporated herein by reference.
(b) The information set forth in the Information Statement
under the caption "THE MERGER-- Merger Consideration" is incorporated herein
by reference.
Item 5. Plans or Proposals of the Issuer or Affiliate
(a)-(g) The information set forth in the Information Statement
under the captions "THE MERGER--Certain Effects of the Merger," "THE
MERGER--Merger Financing" and "THE MERGER--Conduct of Business After the
Merger" is incorporated herein by reference.
Item 6. Source and Amount of Funds or Other Consideration.
(a) The information set forth in the Information Statement
under the captions "THE MERGER--Merger Financing" and "THE MERGER
AGREEMENT--High Yield Financing" is incorporated herein by reference.
(b) The information set forth in the Information Statement
under the captions "THE MERGER--Expenses of the Transaction" and "THE MERGER
AGREEMENT--Expenses and Fees" is incorporated herein by reference.
(c) The information set forth in the Information Statement
under the captions "THE MERGER--Merger Financing" and "THE MERGER
AGREEMENT--High Yield Financing" is incorporated herein by reference.
(d) Not applicable.
Item 7. Purposes, Alternatives, Reasons and Effects.
(a)-(c) The information set forth in the Information Statement
under the captions "THE MERGER--Background of the Merger," "THE
MERGER--Recommendation of the PriCellular Board; Reasons for the Merger"and
"THE MERGER--Purpose and Structure of the Transaction; Reasons of ACC,
Spectrum and Applegate for the Merger; Fairness of the Transaction" is
incorporated herein by reference.
(d) The information set forth in the Information Statement
under the captions "THE MERGER--Recommendation of the PriCellular Board;
Reasons for the Merger," "THE MERGER--Certain Effects of the Merger" and "THE
MERGER--Certain Federal Income Tax Consequences" is incorporated herein by
reference.
Item 8. Fairness of the Transaction.
(a)-(b) The information set forth in the Information Statement
under the captions "THE MERGER--Recommendation of the PriCellular Board;
Reasons for the Merger," "THE MERGER--Opinions of the Financial Advisors to
the PriCellular Board" and "THE MERGER--Purpose and Structure of the
Transaction; Reasons of ACC, Spectrum and Applegate for the Merger; Fairness
of the Transaction" is incorporated herein by reference.
(c) The information set forth in the Information Statement
under the captions "THE VOTING AGREEMENT" and "SUMMARY" is incorporated herein
by reference.
(d) The information set forth in the Information Statement
under the captions "THE MERGER--Recommendation of the PriCellular Board;
Reasons for the Merger" and "THE MERGER--Opinions of the Financial Advisors to
the PriCellular Board" is incorporated herein by reference.
(e) The information set forth in the Information Statement
under the caption "THE MERGER--Recommendation of the PriCellular Board;
Reasons for the Merger" is incorporated herein by reference.
(f) Not applicable.
Item 9. Reports, Opinions, Appraisals and Certain Negotiations.
(a)-(c) The information set forth in the Information Statement
under the captions "THE MERGER-- Recommendation of the PriCellular Board;
Reasons for the Merger," "THE MERGER--Opinions of the Financial Advisors to
the PriCellular Board" and "THE MERGER--Risks of Insolvency on Former
Stockholders of PriCellular" is incorporated herein by reference.
Item 10. Interest in Securities of the Issuer.
(a)-(b) The information set forth in the Information Statement
under the caption "SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
OF PRICELLULAR" is incorporated herein by reference.
Item 11. Contracts, Arrangements or Understandings with Respect to the
Issuer's Securities
The information set forth in the Information Statement under
the captions "THE MERGER--Interests of Certain Persons in the Merger," "THE
VOTING AGREEMENT" and "OTHER AGREEMENTS" is incorporated herein by reference.
Item 12. Present Intention and Recommendation of Certain Persons with Regard
to the Transaction.
(a) The information set forth in the Information Statement
under the caption "THE VOTING AGREEMENT" is incorporated herein by reference.
(b) The information set forth in the Information Statement
under the captions "THE MERGER--Background of the Merger," "THE
MERGER--Recommendation of the PriCellular Board; Reasons for the Merger" and
"THE MERGER--Interests of Certain Persons in the Merger" is incorporated
herein by reference.
Item 13. Other Provisions of the Transaction.
(a) The information set forth in the Information Statement
under the caption "APPRAISAL RIGHTS OF DISSENTING STOCKHOLDERS" and in
Appendix E to the Information Statement is incorporated herein by reference.
(b) Not applicable.
(c) Not applicable.
Item 14. Financial Information.
(a) The information set forth in the Information Statement
under the captions "SELECTED HISTORICAL FINANCIAL INFORMATION OF PRICELLULAR"
and "MARKET PRICE OF AND DIVIDENDS ON PRICELLULAR COMMON STOCK" is
incorporated herein by reference, as is the information in PriCellular's
Annual Report on Form 10-K for the year ended December 31, 1997 (as amended)
and its quarterly report on Form 10-Q for the quarterly period ended March 31,
1998.
(b) Not applicable.
Item 15. Persons and Assets Employed, Retained or Utilized.
(a) The information set forth in the Information Statement
under the caption "THE MERGER--Interests of Certain Persons in the Merger" is
incorporated herein by reference.
(b) Not applicable.
Item 16. Additional Information.
The information set forth in the Information Statement under
the captions "THE COMPANY," "THE MERGER," "THE MERGER AGREEMENT," "THE VOTING
AGREEMENT," "OTHER AGREEMENTS" and "SECURITY OWNERSHIP OF MANAGEMENT AND
PRINCIPAL STOCKHOLDERS OF PRICELLULAR" is incorporated herein by reference.
Item 17. Material to be Filed as Exhibits.
<TABLE>
<S> <C>
(a)(1)* -- Credit Facilities Commitment Letter dated March 6, 1998 among TD Securities (USA) Inc.,
Merrill Lynch Capital Corporation and ACC.
(a)(2)* -- Indenture for $285,000,000 10 1/2% Senior Notes due 2008, dated as of May 13, 1998 by and
between ACC and Chase Manhattan Bank and Trust Company, N.A.
(a)(3) -- Credit Agreement dated June 25, 1998, among American Cellular Wireless LLC, as
Borrower, and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
TD Securities (USA), Inc. and the several other lenders parties thereto.
(b)(1) -- Fairness Opinion of Gleacher NatWest Inc. (incorporated herein by reference to Appendix C
of the Information Statement)
(b)(2) -- Fairness Opinion of SBC Warburg Dillon Read Inc. (incorporated herein by reference to
Appendix D of the Information Statement)
(b)(3) -- Solvency Opinion of Valuation Research
(c)(1) -- Voting Agreement dated as of March 6, 1998 between ACC and certain stockholders named
therein (incorporated herein by reference to Appendix B of the Information Statement)
(c)(2)* -- Spectrum Equity Investors, L.P. Side Letter dated as of March 6, 1998
(c)(3)* -- AT&T Wireless Services, Inc. Consent and Waiver dated as of March 6, 1998
(d) -- Definitive Information Statement on Schedule 14C dated May 28, 1998 (incorporated herein
by reference).
(e) -- "Appraisal Rights of Dissenting Shareholders" and Section 262 of the General Corporation
Law of the State of Delaware (incorporated herein by reference to Appendix C of the
Information Statement and the information under the caption "APPRAISAL RIGHTS OF
DISSENTING STOCKHOLDERS")
(f) Not Applicable
</TABLE>
* Previously filed.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: July 2, 1998
AMERICAN CELLULAR CORPORATION PRICELLULAR CORPORATION
By: /s/ Brian McTernan By: /s/ Brian McTernan
----------------------------- ----------------------------
Name: Brian McTernan Name: Brian McTernan
Title: President
SPECTRUM EQUITY INVESTORS, L.P. BRION APPLEGATE
By: Spectrum Equity Associates, L.P.
By: /s/ Brion Applegate /s/ Brion Applegate
----------------------------- --------------------------------
Name: Brion Applegate
Title: General Partner
<TABLE>
EXHIBIT INDEX
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C>
(a)(1)* -- Credit Facilities Commitment Letter dated March 6, 1998 among TD Securities (USA) Inc.,
Merrill Lynch Capital Corporation and ACC.
(a)(2)* -- Indenture for $285,000,000 10 1/2% Senior Notes due 2008, dated as of May 13, 1998 by and
between ACC and Chase Manhattan Bank and Trust Company, N.A.
(a)(3) -- Credit Agreement dated June 25, 1998, among American Cellular Wireless LLC, as
Borrower, and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
TD Securities (USA), Inc. and the several other lenders parties thereto.
(b)(1) -- Fairness Opinion of Gleacher NatWest Inc. (incorporated herein by reference to Appendix C
of the Information Statement)
(b)(2) -- Fairness Opinion of SBC Warburg Dillon Read Inc. (incorporated herein by reference to
Appendix D of the Information Statement)
(b)(3) -- Solvency Opinion of Valuation Research
(c)(1) -- Voting Agreement dated as of March 6, 1998 between ACC and certain stockholders named
therein (incorporated herein by reference to Appendix B of the Information Statement)
(c)(2)* -- Spectrum Equity Investors, L.P. Side Letter dated as of March 6, 1998
(c)(3)* -- AT&T Wireless Services, Inc. Consent and Waiver dated as of March 6, 1998
(d) -- Definitive Information Statement on Schedule 14C dated May 28, 1998 (incorporated herein
by reference).
(e) -- "Appraisal Rights of Dissenting Shareholders" and Section 262 of the General Corporation
Law of the State of Delaware (incorporated herein by reference to Appendix C of the
Information Statement and the information under the caption "APPRAISAL RIGHTS OF
DISSENTING STOCKHOLDERS")
(f) Not Applicable
</TABLE>
* Previously filed.
Exhibit 99.(a)(3)
===============================================================================
AMERICAN CELLULAR CORPORATION
(To be Merged With and Into PriCellular Corporation),
as a Guarantor,
and
AMERICAN CELLULAR WIRELESS LLC
(To be Merged With PriCellular Wireless Corporation),
as Borrower,
and
THE OTHER GUARANTORS PARTY HERETO
----------------------
$1,000,000,000
CREDIT AGREEMENT
Dated as of June 25, 1998
----------------------
TD SECURITIES (USA) INC.
and
MERRILL LYNCH & CO.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
as Arrangers,
and
TORONTO DOMINION (TEXAS), INC.,
as Administrative Agent,
and
MERRILL LYNCH & CO.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
as Syndication Agent,
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION
and
NATIONSBANK, N.A.,
as Co-Documentation Agents,
and
THE LENDERS PARTY HERETO
===============================================================================
<TABLE>
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is attached but is inserted
for convenience of reference only.
Page
----
<S> <C> <C>
Section 1. Definitions, Accounting Matters and Rules of Construction.......................................1
1.01. Certain Defined Terms...........................................................................1
1.02. Accounting Terms and Determinations............................................................36
1.03. Classes and Types of Loans.....................................................................36
1.04. Rules of Construction..........................................................................36
Section 2. Commitments, Letters of Credit, Fees, Register, Prepayments and Replacement of
Lenders........................................................................................37
2.01. Loans..........................................................................................37
2.02. Borrowings.....................................................................................40
2.03. Letters of Credit..............................................................................40
2.04. Termination and Reductions of Commitments......................................................44
2.05. Fees...........................................................................................46
2.06. Lending Offices................................................................................46
2.07. Several Obligations of Lenders.................................................................46
2.08. Notes; Register................................................................................46
2.09. Optional Prepayments and Conversions or Continuations of Loans.................................47
2.10. Mandatory Prepayments..........................................................................48
2.11. Replacement of Lenders.........................................................................51
Section 3. Payments of Principal and Interest.............................................................52
3.01. Repayment of Loans.............................................................................52
3.02. Interest.......................................................................................52
Section 4. Payments; Pro Rata Treatment; Computations; Etc................................................53
4.01. Payments.......................................................................................53
4.02. Pro Rata Treatment.............................................................................53
4.03. Computations...................................................................................54
4.04. Minimum Amounts................................................................................54
4.05. Certain Notices................................................................................54
4.06. Non-Receipt of Funds by Administrative Agent...................................................55
4.07. Right of Setoff; Sharing of Payments; Etc......................................................56
Section 5. Yield Protection, Etc..........................................................................57
5.01. Additional Costs...............................................................................57
5.02. Limitation on Types of Loans...................................................................58
5.03. Illegality.....................................................................................59
5.04. Treatment of Affected Loans....................................................................59
5.05. Compensation...................................................................................59
5.06. Net Payments...................................................................................60
Section 6. Guarantee......................................................................................62
6.01. The Guarantee..................................................................................62
6.02. Obligations Unconditional......................................................................62
6.03. Reinstatement..................................................................................64
6.04. Subrogation; Subordination.....................................................................64
6.05. Remedies.......................................................................................64
6.06. Instrument for the Payment of Money............................................................64
6.07. Continuing Guarantee...........................................................................64
6.08. General Limitation on Guarantee Obligations....................................................64
Section 7. Conditions Precedent...........................................................................65
7.01. Effectiveness and Initial Extension of Credit..................................................65
7.02. Initial and Subsequent Extensions of Credit....................................................70
7.03. Determinations Under Section 7.................................................................71
Section 8. Representations and Warranties.................................................................71
8.01. Corporate Existence............................................................................71
8.02. Financial Condition; Etc.......................................................................71
8.03. Litigation.....................................................................................72
8.04. No Breach; No Default..........................................................................72
8.05. Action.........................................................................................73
8.06. Approvals......................................................................................73
8.07. Representations and Warranties in the Merger Agreement.........................................73
8.08. ERISA..........................................................................................73
8.09. Taxes..........................................................................................74
8.10. Investment Company Act; Public Utility Holding Company Act; Other Restrictions.................74
8.11. Environmental Matters..........................................................................74
8.12. Environmental Investigations...................................................................75
8.13. Use of Proceeds................................................................................75
8.14. Subsidiaries...................................................................................75
8.15. Properties.....................................................................................76
8.16. Security Interest; Absence of Financing Statements; Etc........................................76
8.17. Licenses and Permits; Compliance with Laws.....................................................76
8.18. True and Complete Disclosure...................................................................77
8.19. Solvency; Etc..................................................................................77
8.20. Contracts......................................................................................77
8.21. Labor Matters..................................................................................77
8.22. FCC Matters and Governmental Matters...........................................................77
8.23. Parent Notes...................................................................................78
8.24. Year 2000......................................................................................78
Section 9. Covenants......................................................................................79
9.01. Financial Statements, Etc......................................................................79
9.02. Litigation, Etc................................................................................82
9.03. Existence; Compliance with Law; Payment of Taxes; Inspection Rights; Performance
of Obligations; Etc.........................................................................82
9.04. Insurance......................................................................................83
9.05. Limitation on Lines of Business; Limitation on Activity of License Subsidiaries;
Limitation on Management Agreements.........................................................83
9.06. Limitation on Fundamental Changes, Acquisitions or Dispositions................................83
9.07. Limitation on Liens and Negative Pledges.......................................................88
9.08. Prohibition on Disqualified Capital Stock; Limitation on Indebtedness and
Contingent Obligations......................................................................90
9.09. Limitation on Investments; Limitation on Creation of Subsidiaries and Unrestricted
Subsidiaries................................................................................92
9.10. Limitation on Dividend Payments................................................................95
9.11. Financial Covenants............................................................................96
9.12. Pledge or Mortgage of Additional Collateral....................................................97
9.13. Security Interests; Further Assurances.........................................................99
9.14. Compliance with Environmental Laws............................................................100
9.15. Limitation on Transactions with Affiliates....................................................101
9.16. Limitation on Accounting Changes; Limitation on Investment Company Status.....................101
9.17. Limitation on Modifications of Certain Documents, Etc.........................................101
9.18. Interest Rate Protection Agreements...........................................................101
9.19. Limitation on Certain Restrictions Affecting Subsidiaries.....................................101
9.20. Additional Obligors; Cellular Licenses to Be Held by License Subsidiaries.....................102
9.21. Limitation on Leases..........................................................................102
9.22. Limitation on Change of Principal Place of Business or Corporate Name.........................102
9.23. Limitation on Activities of Parent............................................................102
9.24. Limitation on Issuance or Dispositions of Equity Interests of Borrower,
Subsidiaries and Unrestricted Subsidiaries.................................................103
9.25. Limitation on Payments or Prepayments of Indebtedness or Modification of Debt
Documents..................................................................................103
9.26. Casualty and Condemnation.....................................................................104
9.27. Tax Sharing Arrangements......................................................................104
9.28. Maintenance of Corporate Separateness.........................................................104
9.29. Changes in Factual Information Regarding the Collateral.......................................104
Section 10. Events of Default.............................................................................104
Section 11. Agents........................................................................................108
11.01. General Provisions............................................................................108
11.02. Indemnification...............................................................................110
11.03. Consents Under Other Credit Documents.........................................................110
11.04. Collateral Sub-Agents.........................................................................110
Section 12. Miscellaneous.................................................................................111
12.01. Waiver........................................................................................111
12.02. Notices.......................................................................................111
12.03. Expenses, Indemnification, Etc................................................................111
12.04. Amendments, Etc...............................................................................112
12.05. Successors and Assigns........................................................................115
12.06. Assignments and Participations................................................................115
12.07. Survival......................................................................................117
12.08. Captions......................................................................................117
12.09. Counterparts; Interpretation; Effectiveness...................................................117
12.10. Governing Law; Submission to Jurisdiction; Waivers; Etc.......................................117
12.11. Confidentiality...............................................................................118
12.12. Independence of Representations, Warranties and Covenants.....................................118
12.13. Severability..................................................................................118
12.14. Acknowledgments...............................................................................119
Signatures..................................................................................................S-1
ANNEX A - Commitments
SCHEDULE 1.01(a) - Applicable Margins Before Reset Date
SCHEDULE 1.01(b) - Applicable Margins After Reset Date
SCHEDULE 1.01(c) - Applicable Revolving Credit Fee Percentage
SCHEDULE 1.01(d) - Guarantors
SCHEDULE 3.01(b) - Amortization Schedule
SCHEDULE 8.02(b) - Certain Contingent Obligations
SCHEDULE 8.02(c) - Certain Financial Matters
SCHEDULE 8.03 - Litigation
SCHEDULE 8.09 - Tax Matters
SCHEDULE 8.14 - Subsidiaries of Borrower
SCHEDULE 8.20 - Certain Contracts
SCHEDULE 8.21 - Labor Matters
SCHEDULE 8.22(b) - Cellular License Expiration Dates as of Closing Date
SCHEDULE 8.22(c) - Qualifications with Respect to Cellular Licenses
SCHEDULE 9.07 - Certain Existing Liens
SCHEDULE 9.08 - Certain Indebtedness to Remain Outstanding
SCHEDULE 9.09 - Investments
SCHEDULE 9.15 - Existing Affiliate Agreements
EXHIBIT A-1 - Form of Revolving Credit Note
EXHIBIT A-2 - Form of Tranche A Term Loan Note
EXHIBIT A-3 - Form of Tranche B Term Loan Note
EXHIBIT A-4 - Form of Tranche C Term Loan Note
EXHIBIT A-5 - Form of Swing Loan Note
EXHIBIT B - Form of Intercompany Note
EXHIBIT C - Form of Interest Rate Certificate
EXHIBIT D-1 - Form of Security Agreement
EXHIBIT D-2 - Form of Unrestricted Subsidiary Pledge Agreement
EXHIBIT E-1 - Form of Opinion of Counsel to the Obligors
EXHIBIT E-2 - Form of Opinion of Special FCC Counsel to the Obligors
EXHIBIT F - Form of Notice of Assignment
EXHIBIT G - Form of Notice of Borrowing
EXHIBIT H - Form of Notice of Conversion/Continuation
EXHIBIT I - Form of Joinder Agreement
EXHIBIT J - Form of Section 5.06 Certificate for Lenders
EXHIBIT K - Form of Collateral Assignment of Location Agreements
EXHIBIT L - Form of Assignment Agreement
</TABLE>
CREDIT AGREEMENT dated as of June 25, 1998, among AMERICAN
CELLULAR WIRELESS LLC (to be merged with PriCellular Wireless Corporation), as
Borrower; AMERICAN CELLULAR CORPORATION (to be merged with and into PriCellular
Corporation), as a Guarantor; the other Guarantors party hereto; each of the
lenders that is a signatory hereto identified under the caption "LENDERS" on the
signature pages hereto or that, pursuant to Section 12.06(b), shall become a
"Lender" hereunder (individually, a "Lender" and, collectively, the "Lenders");
TD SECURITIES (USA) INC. and MERRILL LYNCH & CO., MERRILL LYNCH, PIERCE, FENNER
& SMITH INCORPORATED, as arranging agents ("Arrangers"); TORONTO DOMINION
(TEXAS), INC., as administrative agent ("Administrative Agent"); MERRILL LYNCH &
CO., MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as syndication agent
("Syndication Agent"); and BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION and NATIONSBANK, N.A., as co-documentation agents ("Co-Documentation
Agents").
The parties hereto agree as follows:
Section 1. Definitions, Accounting Matters and Rules of
Construction.
1.01. Certain Defined Terms. As used herein, the
following terms shall have the following meanings:
"ABR Loans" shall mean Loans that bear interest at rates
based upon the Alternate Base Rate.
"Acquisition" shall mean, with respect to any Person, any
transaction or series of related transactions for the direct or indirect (a)
acquisition of all or substantially all of the Property of any other Person, or
of any business or division of any other Person, (b) acquisition of in excess of
50% of the Equity Interests of any other Person, or otherwise causing any other
Person to become a Subsidiary of such Person, or (c) merger or consolidation or
any other combination with any other Person.
"Acquisition Consideration" shall mean the purchase
consideration for any Acquisition and all other payments made and liabilities
incurred by any Company in exchange for, or as part of, or in connection with
any Acquisition, whether paid in cash or by exchange of Equity Interests or of
assets or otherwise and whether payable at or prior to the consummation of such
Acquisition or deferred for payment at any future time, whether or not any such
future payment is subject to the occurrence of any contingency, and includes any
and all payments and liabilities representing the purchase price and any
assumptions of liabilities, "earn-outs" and other Profit Payment Agreements,
consulting agreements, service agreements and non-competition agreements and
other liabilities of every type and description.
"Additional Collateral" see Section 9.12.
"Additional Obligors" see Section 9.20.
"Adjusted Net Income" shall mean, for any period, the
consolidated net income (loss) for such period, of Borrower and its Consolidated
Subsidiaries calculated on a consolidated basis in accordance with GAAP,
adjusted by excluding (to the extent taken into account in the calculation of
such consolidated net income (loss)) the effect of (a) gains or losses for such
period from Dispositions not in the ordinary course of business and Excluded
Dispositions not in the ordinary course of business, and the tax consequences
thereof, (b) any non-recurring or extraordinary items of income or expense for
such period and the tax consequences thereof, (c) the portion of net income
(loss) of any Person (other than a Subsidiary) in which Borrower or any
Subsidiary has an ownership interest, except to the extent of the amount of cash
dividends or other cash distributions actually paid to Borrower or (subject to
clause (e) below) any Subsidiary during such period, (d) the net income (loss)
of any Person combined with Borrower or any Subsidiary on a "pooling of
interests" basis attributable to any period prior to the date of combination,
(e) the net income of any Subsidiary to the extent that the declaration or
payment of dividends or similar distribution by such Subsidiary was not for the
relevant period permitted, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to such Subsidiary or its stockholders,
and (f) any net gain from the collection of proceeds of life insurance or "key
man" insurance policies.
"Administrative Agent" see the introduction hereto.
"Advance Date" see Section 4.06.
"Affiliate" shall mean, with respect to any Person, any other
Person which directly or indirectly controls, or is under common control with,
or is controlled by, such Person. As used in this definition, "control"
(including, with its correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly, of power to direct
or cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise). Notwithstanding the foregoing, solely for purposes of Section 9.15,
(i) Borrower shall not be deemed an Affiliate of any Subsidiary, (ii) no
Subsidiary shall be deemed an Affiliate of any other Subsidiary or Borrower,
(iii) with respect to Borrower or any Subsidiary, Parent shall be deemed an
Affiliate of Borrower and each Subsidiary, and (iv) with respect to Parent, no
other Company is an Affiliate. Each Unrestricted Subsidiary shall be deemed an
Affiliate of Parent, Borrower and the Subsidiaries.
"Affiliate Transaction" see Section 9.15.
"Agent" means any of Administrative Agent, Syndication Agent,
either Arranger or either Co-Documentation Agent.
"Agreement" shall mean this Credit Agreement, as amended from
time to time.
"Allowable Cellular System" shall mean, at any date, (A) any
Cellular System the geographical boundaries for any portion of which are
contiguous to or within 75 miles from the geographical boundaries of (x) any
Cellular System owned by Borrower or any Subsidiary on the date hereof or (y)
any Cellular System in the continental United States or group of Cellular
Systems in the same general geographic area in the continental United States
constituting a cluster in each case under this clause (y) owned by Borrower or
any Subsidiary with a combined Net Pops at such date for all such Cellular
Systems of at least 750,000 Net Pops at such date and (B) any group of Cellular
Systems in the same general geographic area of the continental United States
constituting a cluster owned by Borrower or any Subsidiary with a combined Net
Pops at such date for all such Cellular Systems of at least 750,000 Net Pops.
"Net Pops" of any Cellular System shall mean, at any date, the estimated
population at such date (as set forth in published reports of the Donnelley
Market Information Service) of such Cellular System multiplied by the percentage
interest that Borrower or any Subsidiary owns in the entity licensed in such
Cellular System.
"Alternate Base Rate" shall mean for any day, a rate per annum
that is equal to the higher of (i) the Federal Funds Rate, plus 0.50%, or (ii)
the Prime Rate.
"Amortization Payment" shall mean each scheduled installment
of payments on the Term Loans as set forth in Section 3.01(b).
"Annualized Operating Cash Flow" shall mean (i) for any Test
Date other than June 30, 1998, September 30, 1998 and March 31, 1999, the
product of (x) Operating Cash Flow for the two fiscal quarters ending on such
Test Date, and (y) two (2); (ii) for the June 30, 1998 and September 30, 1998
Test Date, the product of (x) Operating Cash Flow for the fiscal quarter ending
on such Test Date and (y) four (4); and (iii) for the March 31, 1999 Test Date,
the product of (x) Operating Cash Flow for the three fiscal quarters ending on
such Test Date and (y) 4/3. For purposes of the calculation as of any Test Date
of the Pro Forma Debt Service Coverage Ratio, the Total Leverage Ratio and the
Senior Leverage Ratio, Annualized Operating Cash Flow shall be calculated on a
pro forma basis in accordance with GAAP to give effect to any Acquisition or
Disposition of a Cellular System consummated during the fiscal period of
Borrower ended on such Test Date as if each such Acquisition had been effected
on the first day of such period and as if each such Disposition had been
consummated on the day prior to the first day of such period; provided, however,
that, other than for purposes of Section 9.11, (A) the foregoing provisions of
this sentence shall not apply with respect to any Acquisition which was
consummated on or after the first day of the fiscal quarter of Borrower which
ends on such Test Date and (B) not more than 85% of the Operating Cash Flow (if
positive) of the acquired Person or business for any period shall be included on
a pro forma basis pursuant to the foregoing provisions of this sentence. For
purposes of the foregoing sentence, Operating Cash Flow and all defined terms
used therein (or in any such defined term) shall be deemed to refer to such
Person or business when calculating Operating Cash Flow for such Person or
business.
"Applicable Lending Office" shall mean, for each Lender and
for each Type of Loan, the "Lending Office" of such Lender (or of an Affiliate
of such Lender) designated for such type of Loan on the signature pages hereof
or such other office of such Lender (or of an Affiliate of such Lender) as such
Lender may from time to time specify to Administrative Agent and Borrower as the
office by which its Loans of such Type are to be made and maintained.
"Applicable Margin" shall be, for any Loan, (x) from the
Closing Date to the first date (the "Reset Date") Borrower shall have delivered
to the Lenders the financial statements and Interest Rate Certificates required
by Sections 9.01(a) and (e) and an Officers' Certificate demonstrating the then
applicable Total Leverage Ratio, the percentage per annum set forth on Schedule
1.01(a) for such Loan, and (y) on and after the Reset Date, when the Total
Leverage Ratio at the end of the most recently ended fiscal quarter is as set
forth in Schedule 1.01(b), the percentage per annum set forth opposite such
Total Leverage Ratio in Schedule 1.01(b) for such Loan. Any change in the Total
Leverage Ratio shall be effective to adjust the Applicable Margin as of the date
of receipt by Administrative Agent of the Interest Rate Certificate most
recently delivered pursuant to Section 9.01(e). If Borrower fails to deliver the
Interest Rate Certificates and financial statements within the times specified
in Sections 9.01(a), (b) and (e), the Total Leverage Ratio shall be deemed to be
greater than or equal to 8.0:1.0 until Borrower delivers such Interest Rate
Certificates and financial statements.
"Applicable Revolving Credit Fee Percentage" shall mean
0.5000% per annum; provided, however, that on and after the Reset Date, when the
Total Leverage Ratio at the end of the most recently ended fiscal quarter is as
set forth in Schedule 1.01(c), the percentage per annum set forth opposite such
Total Leverage Ratio in Schedule 1.01(c). Any change in the Total Leverage Ratio
shall be effective to adjust the Applicable Revolving Credit Fee Percentage as
of the date of receipt by Administrative Agent of the Interest Rate Certificate
most recently delivered pursuant to Section 9.01(e). If Borrower fails to
deliver the Interest Rate Certificates and financial statements within the times
specified in Sections 9.01(a), (b) and (e), such ratio shall be deemed to be
greater than or equal to 7.0:1.0 until Borrower delivers such Interest Rate
Certificates and financial statements.
"Approved Fund" shall mean, with respect to any Lender that is
a fund or commingled investment vehicle that invests in commercial loans, any
other fund that invests in commercial loans and is managed or advised by the
same investment advisor as such Lender or by an Affiliate of such investment
advisor.
"Arrangers" see the introduction hereto.
"Bankruptcy Code" shall mean the Federal Bankruptcy Code
of 1978.
"Borrower" shall mean American Cellular Wireless LLC, a
Delaware limited liability company.
"Business Day" shall mean any day (a) on which commercial
banks are not authorized or required to close in New York City or Houston, Texas
and (b) if such day relates to a borrowing of, a payment or prepayment of
principal of or interest on, a Continuation or Conversion of or into, or an
Interest Period for, a LIBOR Loan or a notice by Borrower with respect to any
such borrowing, payment, prepayment, Continuation, Conversion or Interest
Period, that is also a day on which dealings in Dollar deposits are carried out
in the London interbank market.
"Capital Expenditures" shall mean, for any period, any direct
or indirect (by way of acquisition of securities of a Person or the expenditure
of cash or the incurrences of Indebtedness) expenditures in respect of the
purchase or other acquisition of fixed or capital assets, excluding (i) normal
replacement and maintenance programs properly charged to current operations,
(ii) any expenditure made with the Net Available Proceeds of any Disposition to
the extent such Net Available Proceeds are not required to be applied to the
prepayment of the Loans in accordance with Section 2.10(a)(iv), (iii) any
expenditure made with the proceeds of any Excluded Disposition, (iv)
expenditures in an amount not to exceed the sum of (x) the Net Available
Proceeds of any Casualty Event to the extent such Net Available Proceeds are not
required to be applied to the prepayment of the Loans in accordance with Section
2.10(a)(i) and (y) the amount of any applicable insurance deductibles with
respect to such Casualty Event to the extent such amount is applied as set forth
in clause (w) of Section 2.10(a)(i) within the period specified therein, (v)
expenditures to effect Permitted Acquisitions, and (vi) the purchase price of
equipment to the extent that the consideration therefor consists of used or
surplus equipment being traded in at such time or the proceeds of a concurrent
sale of such used or surplus equipment, in each case in the ordinary course of
business.
"Capital Lease," as applied to any Person, shall mean any
lease of any Property by that Person as lessee which, in conformity with GAAP,
is required to be classified and accounted for as a capital lease on the balance
sheet of that Person.
"Capital Lease Obligations" shall mean, for any Person, all
obligations of such Person to pay rent or other amounts under a Capital Lease,
and, for purposes of this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP.
"Casualty Event" shall mean, with respect to any Property
(including Real Property) of any Person, any loss of title with respect to Real
Property or any loss of or damage to or destruction of, or any condemnation or
other taking (including by any Governmental Authority) of, such Property
(including Real Property) for which such Person or any of its Subsidiaries
receives insurance proceeds or proceeds of a condemnation award or other
compensation; provided, however, no such event shall constitute a Casualty Event
if (x) such proceeds or other compensation in respect thereof is less than $1.0
million and (y) all such proceeds and other compensation in respect of all such
events since the Closing Date is less than $5.0 million. "Casualty Event" shall
include but not be limited to any taking of any Mortgaged Real Property or Real
Property of any Company or any part thereof, in or by condemnation or other
eminent domain proceedings pursuant to any law, general or special, or by reason
of the temporary requisition of the use or occupancy of any Mortgaged Real
Property or Real Property of any Company or any part thereof, by any
Governmental Authority, civil or military.
"Cellular Licenses" see Section 8.22(a).
"Cellular System" shall mean a cellular mobile radio telephone
system constructed and operated in an MSA or an RSA (or any successor
territorial designation) pursuant to an Cellular License therefor issued by the
FCC.
"CERCLA" shall mean the United States Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended.
"Change of Control" shall mean any transaction or event
(including, without limitation, an issuance, sale or exchange of Equity
Interests, a merger or consolidation, or a dissolution or liquidation) occurring
on or after the date hereof (whether or not approved by the board of directors
of Parent) as a direct or indirect result of which (a) if such transaction or
event occurs prior to the consummation of an Initial Public Offering, any
Excluded Person fails to beneficially own, directly or indirectly, Equity
Interests of Parent representing at least a majority of the Equity Interests of
Parent beneficially owned by such Excluded Person on the Closing Date or the
Excluded Persons cease to have the ability to appoint a majority of the board of
directors of Parent or Borrower (it being understood that a Change of Control
shall not occur solely as a result of John Fujii or Brian McTernan ceasing to
act as an officer of Parent or Borrower); provided, however, that this clause
(a) shall not apply from after the later of the date of the delivery of the
certificate pursuant to Section 9.01(c)(ii) for the fiscal quarter ended
September 30, 2000 (the "Delivery Date") and such date on or after the Delivery
Date on which no Default has occurred and is continuing; (b) any Person or any
group (other than the Excluded Persons or the Excluded Group) shall (A)
(directly or indirectly) beneficially own in the aggregate Equity Interests of
Parent having 40% or more of the aggregate voting power of all Equity Interests
of Parent at the time outstanding or (B) have the right or power to appoint a
majority of the board of directors of Parent; (c) if such transaction or event
is an Initial Public Offering or occurs after the consummation of an Initial
Public Offering, 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 shareholders 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 at
least a majority of the board of directors of Parent then in office; (d) any
event or circumstance constituting a "change of control" under the Parent
Financing Documents or any other documentation evidencing or governing any
Indebtedness of any Company in a principal amount in excess of $10.0 million
(other than under the Credit Documents) shall occur which results in an
obligation of any Company to prepay, purchase, offer to purchase, redeem or
defease all or a portion of such Indebtedness; or (e) Parent fails to own
beneficially and of record 100% (on a fully diluted basis) of the Equity
Interests of Borrower. For purposes of this definition, the terms "beneficially
own" and "group" shall have the respective meanings ascribed to them pursuant to
Section 13(d) of the United States Securities Exchange Act of 1934, except that
a Person or group shall be deemed to "beneficially own" all securities that such
Person or group has the right to acquire, whether such right is exercisable
immediately or only after the passage of time, and except that Persons who from
time to time are parties to the Stockholders Agreement dated as of March 5, 1998
by and among American Cellular Corporation and the parties listed on Exhibit A
thereto, as in effect from time to time, will not be deemed a "group" solely by
reason of their being such parties (provided that no Person or group other than
the Excluded Persons shall have the right to designate or shall have designated
a majority of the board of directors of Parent).
"Class" see Section 1.03.
"Closing Date" shall mean the date on which the initial
extensions of credit are made hereunder.
"Code" shall mean the United States Internal Revenue Code of
1986, as amended.
"Co-Documentation Agent" see the introduction hereto.
"Collateral" shall mean all of the Pledged Collateral and
Mortgaged Real Property.
"Collateral Account" see Section 4.01 of the Security
Agreement or the Unrestricted Subsidiary Pledge Agreement, as the case may be.
"Collateral Assignment of Location Agreements" shall mean the
Collateral Assignment of Location Agreements substantially in the form of
Exhibit K among the Obligors and Administrative Agent, as the same may be
amended in accordance with the terms thereof and hereof, or such other
agreements reasonably acceptable to Administrative Agent as shall be necessary
to comply with applicable Requirements of Law and effective to assign to
Administrative Agent the right, title and interest identified therein.
"Commission" shall mean the United States Securities and
Exchange Commission.
"Commitment Letter" shall mean the Commitment Letter among
Toronto Dominion (Texas), Inc., TD Securities (USA) Inc. and Merrill Lynch
Capital Corporation and Parent dated March 6, 1998 together with Exhibit A
thereto and incorporated therein.
"Commitments" shall mean the Revolving Credit Commitments
and the Term Loan Commitments.
"Communications Act" shall mean the United States
Communications Act of 1934, and any similar or successor federal statute, and
the rules and regulations of the FCC thereunder, all as amended and as the same
may be in effect from time to time.
"Communications Regulatory Authority" shall mean the FCC, any
State PUC and any future federal or state communication regulatory commission,
agency, department, board or authority.
"Companies" shall mean the Obligors and their respective
Subsidiaries; and "Company" shall mean any of them. No Unrestricted Subsidiary
is a Company.
"Consolidated Interest Expense" shall mean, for any period,
all interest expense (including original issue discount, interest paid in kind,
commitment fees, letter of credit fees and the interest component of Capital
Leases but excluding any up front, underwriting or commitment fees under the
Commitment Letter to the extent accrued on or prior to the Closing Date) of
Borrower and its Consolidated Subsidiaries for such period including all
capitalized interest and the net amounts payable under all Interest Rate
Protection Agreements; provided, however, that, other than for purposes of
calculating Operating Cash Flow, for any period ending after the Parent Interest
Trigger Date, Consolidated Interest Expense shall include cash interest accruing
during such period on the Parent Notes to the extent accruing on and after the
Parent Interest Trigger Date.
"Consolidated Rental Payments" shall mean, for any period, the
aggregate amount of all rents paid or to be incurred under all operating leases
of Borrower and its Consolidated Subsidiaries as lessees (net of sublease
income).
"Consolidated Subsidiary" shall mean, for any Person, each
Subsidiary of such Person (whether now existing or hereafter created or
acquired) the financial statements of which shall be (or should have been)
consolidated with the financial statements of such Person in accordance with
GAAP.
"Contaminant" see Section 8.11.
"Contingent Obligation" shall mean, as to any Person, any
direct or indirect liability of such Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease, dividend, letter
of credit or other obligation (the "primary obligations") of another Person (the
"primary obligor"), including any obligation of such Person (i) to purchase,
repurchase or otherwise acquire such primary obligations or any security
therefor, (ii) to advance or provide funds for the payment or discharge of any
such primary obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) 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 (iv)
otherwise to assure or hold harmless the holder of any such primary obligation
against loss in respect thereof (each of (i)-(iv), a "Guaranty Obligation"); (b)
with respect to any Surety Instrument (other than any Letter of Credit) issued
for the account of such Person or as to which such Person is otherwise liable
for reimbursement of drawings or payments; (c) to purchase any materials,
supplies or other property from, or to obtain the services of, another Person if
the relevant contract or other related document or obligation requires that
payment for such materials, supplies or other property, or for such services,
shall be made regardless of whether delivery of such materials, supplies or
other property is ever made or tendered, or such services are ever performed or
tendered; or (d) in respect of any Swap Contract; provided, however, that the
term Contingent Obligation shall not include endorsements of instruments for
deposit or collection or standard contractual indemnities entered into, in each
case in the ordinary course of business. The amount of any Contingent Obligation
shall (x) in the case of a Guaranty Obligation, be deemed equal to the stated or
determinable amount of the primary obligation in respect of which such Guaranty
Obligation is made or, if not stated or if indeterminable, the maximum
reasonably anticipated liability in respect thereof, and (y) in the case of
other Contingent Obligations, be equal to the maximum reasonably anticipated
liability in respect thereof.
"Continue," "Continuation" and "Continued" shall refer to the
continuation pursuant to Section 2.09 of a LIBOR Loan from one Interest Period
to the next Interest Period.
"Contractual Obligation" shall mean as to any Person, any
provision of any security issued by such Person or of any mortgage, security
agreement, pledge agreement, indenture, credit agreement, securities purchase
agreement, debt instrument, contract, agreement, instrument or other undertaking
(including, without limitation, any undertaking made to the FCC) to which such
Person is a party or by which it or any of its Property is bound or subject.
"Convert," "Conversion" and "Converted" shall refer to a
conversion pursuant to Section 2.09 of one Type of Loans into another Type of
Loans, which may be accompanied by the transfer by a Lender (at its sole
discretion) of a Loan from one Applicable Lending Office to another.
"Covered Taxes" see Section 5.06(a).
"Credit Documents" shall mean this Agreement, the Notes, the
Letter of Credit Documents and the Security Documents.
"Credit Parties" shall mean Borrower and each Guarantor.
"Creditor" shall mean (i) any Agent, (ii) the Issuing Lender,
(iii) any Lender, and (iv) any Affiliate of a Lender party to a Swap Contract
with an Obligor to the extent such Swap Contract relates to the Loans.
"Debt Issuance" shall mean the incurrence by any Obligor of
any Indebtedness after the Closing Date (other than as permitted by Section
9.08).
"Default" shall mean any event or condition that constitutes
an Event of Default or that would become, with notice or lapse of time or both,
an Event of Default.
"Deferred Drawdown Date" shall mean the Business Day
immediately following the Closing Date.
"Disposition" shall mean (i) any conveyance, sale, lease,
assignment, transfer or other disposition (including by way of merger or
consolidation and including any sale-leaseback transaction) of any Property
(including receivables and Equity Interests of any Subsidiary of any Company or
joint venture of any Company) (whether now owned or hereafter acquired) by any
Company to any Person other than Borrower or any Qualified Subsidiary, (ii) any
issuance or sale by any Subsidiary of its Equity Interests to any Person other
than Borrower or any Qualified Subsidiary and any issuance or sale by any
Unrestricted Subsidiary of its Equity Interests to any Person other than Parent
or a Wholly Owned Unrestricted Subsidiary, and (iii) any liquidating or other
non-ordinary course dividend or distribution or return of Investment received by
any Company in respect of any Unrestricted Subsidiary or any joint venture or
similar enterprise, excluding, however, in each case any Excluded Disposition.
"Disposition Event" shall mean the receipt by any Company of
cash proceeds or cash distributions of any kind from Property received in
consideration for a Disposition.
"Disqualified Capital Stock" shall mean, with respect to any
Person, any Equity Interest of such Person that, by its terms (or by the terms
of any security into which it is convertible or for which it is exchangeable),
or upon the happening of any event, matures (excluding any maturity as the
result of an optional redemption by the issuer thereof) or is mandatorily
redeemable (other than solely for Qualified Capital Stock), pursuant to a
sinking fund obligation or otherwise, or is redeemable at the sole option of the
holder thereof (other than solely for Qualified Capital Stock) or exchangeable
or convertible into debt securities of the issuer thereof at the sole option of
the holder thereof, in whole or in part, on or prior to the date which is 90
days after the Final Maturity Date.
"Dividend Payment" shall mean dividends (in cash, Property or
obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any Equity Interests
or Equity Rights of any Company, but excluding dividends paid through the
issuance of additional shares of Qualified Capital Stock and any redemption or
exchange of any Qualified Capital Stock of such Obligor through the issuance of
Qualified Capital Stock of such Obligor.
"Dollars" and "$" shall mean lawful money of the
United States of America.
"Eligible Person" shall mean (i) a commercial bank organized
under the laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $100.0 million; (ii) a commercial bank organized
under the laws of any other country that is a member of the Organization for
Economic Cooperation and Development (the "OECD"), or a political subdivision of
any such country, and having a combined capital and surplus in a dollar
equivalent amount of at least $100.0 million; provided, however, that such bank
is acting through a branch or agency located in the country in which it is
organized or another country that is also a member of the OECD; (iii) an
insurance company, mutual fund or other entity which is regularly engaged in
making, purchasing or investing in loans or securities or other financial
institution organized under the laws of the United States, any state thereof,
any other country that is a member of the OECD or a political subdivision of any
such country with assets, or assets under management, in a dollar equivalent
amount of at least $100.0 million; (iv) any Affiliate of a Lender; and (v) any
other entity (other than a natural person) which is an "accredited investor" (as
defined in Regulation D under the United States Securities Act of 1933, as
amended) which extends credit or buys loans as one of its businesses including,
but not limited to, insurance companies, mutual funds and investment funds. With
respect to any Lender that is a fund that invests in loans, any other fund that
invests in loans and is managed or advised by the same investment advisor of
such Lender or by an Affiliate of such investment advisor shall be treated as a
single Eligible Person.
"Environmental Claim" shall mean, with respect to any Person,
any written notice, claim, demand or other communication (collectively, a
"claim") by any other Person alleging such Person's liability for any costs,
cleanup costs, response or corrective action costs, damages to natural resources
or other Property, personal injuries, fines or penalties arising out of or
resulting from (i) the presence, Release or threatened Release into the
environment, of any Hazardous Material at any location, whether or not owned by
such Person, or (ii) any violation of any Environmental Law. The term
"Environmental Claim" shall include any claim by any Person seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief
resulting from the presence of Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.
"Environmental Laws" shall mean any and all present and future
applicable laws, rules or regulations of any Governmental Authority, any orders,
decrees, judgments or injunctions and the common law in each case as now or
hereafter in effect, relating to pollution or protection of human health, safety
or the environment, including without limitation, ambient air, indoor air, soil,
or surface water, ground water, land or subsurface strata, and natural resources
such as wetlands, flora or fauna, including, without limitation, those relating
to Releases or threatened Releases of Hazardous Materials into the environment,
or otherwise relating to the manufacture, processing, generation, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials.
"Environmental Requirement" see Section 8.11.
"Equity Financing" shall mean the purchase by the Investors
for cash not later than the time of consummation of the Mergers from Parent of
common equity in an aggregate amount of $25.0 million and preferred stock in an
aggregate amount of $325.0 million not requiring any cash dividends or
redemption or repurchase thereof prior to the final stated maturity of the
Parent Notes.
"Equity Interests" shall mean, with respect to any Person, any
and all shares, interests, participations or other equivalents, including
membership interests (however designated, whether voting or non-voting), of
capital of such Person, including, if such Person is a partnership, partnership
interests (whether general or limited) and any other interest or participation
that confers on a Person the right to receive a share of the profits and losses
of, or distributions of assets of, such partnership, whether outstanding on the
date hereof or issued after the Closing Date.
"Equity Issuance" shall mean any of (a) any issuance or sale
after the Closing Date by Borrower, Parent or any other direct or indirect
parent of Borrower of (x) any Equity Interests (including any Equity Interests
issued upon exercise of any Equity Rights) or any Equity Rights, or (y) any
other security or instrument representing an Equity Interest (or the right to
obtain any Equity Interest) in the issuing or selling Person, or (b) the receipt
by any Company after the Closing Date of any capital contribution (whether or
not evidenced by any Equity Interest issued by the recipient of such
contribution) other than from any other Company, excluding in each case (i) any
issuance of common Equity Interests of Parent to the seller or sellers in
consideration for a Permitted Acquisition, (ii) any issuance or sale of Equity
Interests in any Subsidiary (which, for the avoidance of doubt, is treated as a
Disposition), (iii) any issuance or sale by Parent of Equity Interests of Parent
to employees, directors, officers or consultants pursuant to a benefit or
compensation plan in the ordinary course of business in an amount not to exceed
10% of the outstanding Equity Interests of Parent, (iv) any issuance of
Qualified Capital Stock of Parent to the extent that the proceeds thereof are
used for a substantially contemporaneous purchase or redemption of Equity
Interests of Parent pursuant to Section 9.10(c)(iii), (v) any Excluded Investor
Equity Issuance, and (vi) any issuance of Equity Interests by any Subsidiary to
directors or nominees if required by applicable law if resulting in de minimis
proceeds.
"Equity Rights" shall mean, with respect to any Person, any
outstanding subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including any stockholders' or voting trust agreements)
for the issuance, sale, registration or voting of, or outstanding securities
convertible into, any additional shares of Equity Interests of any class, or
partnership or other ownership interests of any type in, such Person.
"ERISA" shall mean the United States Employee Retirement
Income Security Act of 1974, as amended.
"ERISA Entity" shall mean any member of an ERISA Group.
"ERISA Event" shall mean (a) any "reportable event," as
defined in Section 4043 of ERISA or the regulations issued thereunder with
respect to a Plan (other than an event for which the 30-day notice period is
waived); (b) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived, the failure to make by its due date a required
installment under Section 412(m) of the Code with respect to any Plan or the
failure to make any required contribution to a Multiemployer Plan; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by any ERISA Entity of any liability under Title IV of
ERISA with respect to the termination of any Plan; (e) the receipt by any ERISA
Entity from the PBGC or a plan administrator of any notice relating to an
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan, or the occurrence of any event or condition which is reasonably likely
to constitute grounds under ERISA for the termination of or the appointment of a
trustee to administer, any Plan; (f) the incurrence by any ERISA Entity of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; (g) the receipt by an ERISA Entity of any notice, or the
receipt by any Multiemployer Plan from any ERISA Entity of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; or (h) the occurrence of a nonexempt
prohibited transaction (within the meaning of Section 4975 of the Code or
Section 406 of ERISA) which is reasonably likely to result in liability to any
Company or any Unrestricted Subsidiary.
"ERISA Group" shall mean any Company and any Unrestricted
Subsidiary and all members of a controlled group of corporations and all trades
or businesses (whether or not incorporated) under common control which, together
with Parent, any Subsidiary or any Unrestricted Subsidiary, are treated as a
single employer under Section 414 of the Code.
"Event of Default" see Section 10.
"Excess Cash Flow" shall mean, for any period, (A) the sum of
(i) Operating Cash Flow for such period (calculated for this definition by
adding back the cash portion of all extraordinary or non-recurring items of
income (other than from Dispositions and Excluded Dispositions) to the extent
excluded in the calculation of Adjusted Net Income and by deducting the cash
portion of all extraordinary or non-recurring items of expense to the extent
excluded in the calculation of Adjusted Net Income), (ii) cash distributions
received from the Laredo Joint Venture during such period, (iii) any net
decrease in Working Capital during such period (except to the extent
attributable to assets or Persons subject to a Disposition during such period),
and (iv) cash received from the proceeds of any life insurance or "key man"
policies during such period, minus (B) the sum of (i) cash interest expense
(including, without duplication, cash Capital Lease expense and commitment fees)
of Borrower and its Consolidated Subsidiaries for such period to the extent
deducted in calculating Adjusted Net Income, (ii) the sum of all scheduled
principal payments (other than pursuant to Section 2.10(a)(v)) on any
Indebtedness (including Capital Leases and Term Loans pursuant to Section
3.01(b)) of Borrower and its Consolidated Subsidiaries made during such period
from internally generated funds and all prepayments of Revolving Credit Loans
made from internally generated funds to the extent accompanied by a permanent
reduction in Revolving Credit Commitments, (iii) Capital Expenditures made
during such period by Borrower and the Subsidiaries to the extent funded from
internally generated funds, (iv) all cash income taxes actually paid by Borrower
or any Subsidiary during such period and dividends paid during such period by
Borrower pursuant to Section 9.10(c)(ii), (v) cash dividends paid during such
period by Borrower pursuant to Section 9.10(c)(iii) to the extent made with
internally generated funds, (vi) cash dividends paid during such period by
Borrower pursuant to Section 9.10(d), (vii) cash paid during such period for any
Permitted Acquisition to the extent funded from internally generated funds, and
(viii) any net increases in Working Capital during such period (except to the
extent attributable to assets or Persons subject to an Acquisition during such
period).
"Exchange Act" shall mean the United States Securities
Exchange Act of 1934.
"Exchange Indenture" shall mean the indenture pursuant to
which the Exchange Notes are issued.
"Exchange Notes" see the definition of Parent Notes.
"Exchange Offer" see the definition of Parent Notes.
"Excluded Dispositions" shall mean (i) Dispositions for fair
market value resulting in no more than $100,000 in aggregate proceeds per
Disposition (or series of related Dispositions) and other Dispositions resulting
in up to $5.0 million in aggregate proceeds in any fiscal year (which $5.0
million shall not include any such $100,000 or less Disposition or series of
related Dispositions); (ii) an exchange of equipment or inventory for other
equipment or inventory, provided that the Company effecting such exchange
receives at least substantially equivalent value in such exchange for the
Property disposed of; (iii) any transaction permitted by Section 9.06 (other
than clause (g), (n), (o) or (q) thereof), any Lien permitted by Section 9.07
and any Investment permitted by Section 9.09; (iv) any issuance of Equity
Interests by any Subsidiary or Unrestricted Subsidiary to directors or nominees
if required by applicable law if resulting in de minimis proceeds; and (v) the
sale of inventory in the ordinary course of business.
"Excluded Disposition Proceeds" shall mean any Net Available
Proceeds from any Disposition permitted by Section 9.06(q) that is applied to
the amount of any Revolving Credit Loans that was utilized to effect the
Permitted Acquisition that was the source of the assets acquired and sold in
such Disposition, so long as such Net Available Proceeds are applied to the
Revolving Credit Loans within one Business Day of the receipt thereof (it being
understood that the Revolving Credit Commitments need not be reduced in
connection therewith).
"Excluded Equity Issuance" shall mean any issuance of
Qualified Capital Stock of Parent excluded from the definition of Equity
Issuance by virtue of clause (iv) thereof.
"Excluded Investor Equity Issuance" shall mean not more than
$25.0 million since the Closing Date of proceeds from the issuance of Equity
Interests to (or capital contributions by) the Investors to the extent used to
effect Investments pursuant to Section 9.09(A)(q) or Section 9.09(A)(r).
"Excluded Group" shall mean a "group" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) that includes one or more Excluded
Persons; provided, however, that the voting power of the Equity Interests of
Parent "beneficially owned" (as such term is used in Rule 13d-3 promulgated
under the Exchange Act) by such Excluded Persons (without attribution to such
Excluded Persons of the ownership by other members of the "group") represents a
majority of the voting power of the Equity Interests "beneficially owned" (as
such term is used in Rule 13d-3 promulgated under the Exchange Act) by such
group.
"Excluded Persons" shall mean the Spectrum Group, the
Providence Group, John Fujii or his Permitted Transferees (so long as he is an
officer of Borrower or Parent) and Brian McTernan or his Permitted Transferees
(so long as he is an officer of Borrower or Parent).
"Excluded Taxes" see Section 5.06(a).
"Existing Affiliate Agreements" see Section 9.15.
"Existing Credit Facility" shall mean the existing $60 million
credit facility of a Subsidiary of PriCellular agented by Morgan Guaranty Trust
Company of New York.
"Existing Credit Facility Repayment" shall mean the repayment
of all Indebtedness and cancellation of all commitments to make extensions of
credit under the Existing Credit Facility.
"Existing Indentures" shall mean each Indenture pursuant to
which each tranche of the Existing Notes were issued.
"Existing Notes" shall mean the (i) 14% Senior Subordinated
Discount Notes due 2001 of PriCellular Wireless, (ii) 12 1/4% Senior
Subordinated Discount Notes due 2003 of PriCellular Wireless, (iii) Existing
PriCellular Notes (to the extent not converted into common equity of
PriCellular) and (iv) 10 3/4% Senior Notes due 2004 of PriCellular Wireless.
"Existing PriCellular Notes" shall mean the 10 3/4% Senior
Subordinated Convertible Discount Notes due 2004 of PriCellular.
"FAA" shall mean the United States Federal Aviation
Administration.
"fair market value" shall mean, with respect to any asset, a
price (after taking into account any liabilities relating to such assets), as
determined by Borrower in good faith, that is within a reasonable range of
prices which could be negotiated in an arm's-length free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of which is
under any compulsion to complete the transaction.
"FCC" shall mean the United States Federal Communications
Commission, or any other similar or successor agency of the federal government
administering the Communications Act.
"Federal Funds Rate" shall mean, for any day, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided, however, that (a) if the day for which such
rate is to be determined is not a Business Day, the Federal Funds Rate for such
day shall be such rate on such transactions on the next preceding Business Day
as so published on the next succeeding Business Day and (b) if such rate is not
so published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate quoted to Administrative Agent on such Business Day on
such transactions by three federal funds brokers of recognized standing, as
determined by Administrative Agent.
"Fee Letter" shall mean the Fee Letter dated as of March 6,
1998 by and among TD Securities (USA) Inc., Merrill Lynch Capital Corporation
and Parent.
"Final Maturity Date" shall mean December 31, 2007. If the
Increased Facility Amount shall be put in place, the Final Maturity Date shall
be extended to the final maturity thereof if beyond the Final Maturity Date as
of the Closing Date.
"Financial Maintenance Covenants" shall mean the covenants set
forth in Section 9.11(a) through (e).
"Fixed Charge Coverage Ratio" shall mean, for any Test Date,
the ratio of (x) Operating Cash Flow for the four fiscal quarters ending on such
Test Date to (y) Fixed Charges for the four fiscal quarters ending on such Test
Date. Prior to the completion of four full fiscal quarters after the Closing
Date, Operating Cash Flow and the Consolidated Interest Expense included in such
Fixed Charges for any four-quarter period will be the Operating Cash Flow or the
Consolidated Interest Expense, as the case may be, for the number of then
completed fiscal quarters after the Closing Date multiplied by a fraction, the
numerator of which is four and the denominator of which is the number of fiscal
quarters in such shorter period.
"Fixed Charges" shall mean, for any period, the sum of (i)
Consolidated Interest Expense for such period to the extent paid or payable in
cash during such period, (ii) the sum of all scheduled principal payments on any
Indebtedness of Borrower and its Consolidated Subsidiaries (including, without
duplication, any lease payments in respect of Capital Leases of Borrower and its
Consolidated Subsidiaries attributable to the principal component thereof for
such period), (iii) all cash tax expense actually paid to any Governmental
Authority by Borrower and its Consolidated Subsidiaries for such period (other
than taxes related to Dispositions or Excluded Dispositions not in the ordinary
course of business), (iv) all dividends paid by Borrower to Parent during such
period pursuant to Section 9.10(c)(ii) (other than for taxes related to
Dispositions and Excluded Dispositions not in the ordinary course of business),
and (v) Capital Expenditures during such period to the extent made from
internally generated funds; provided, however, that, until after the September
30, 1999 Test Date, the amount of such Capital Expenditures shall be deemed not
to exceed the product of (x) $250 times (y) the number of net subscribers added
by Borrower or any Subsidiary during the two fiscal quarters ended with the end
of such period times (z) two, except to the extent, if any, that the amount of
such Capital Expenditures exceeds $45.0 million since the Closing Date.
"Funding Date" shall mean the date of the making of any
extension of credit hereunder (including the Closing Date).
"GAAP" shall mean generally accepted accounting principles set
forth as of the relevant date in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which are applicable to the
circumstances as of the date of determination.
"Governmental Authority" shall mean any government or
political subdivision of the United States or any other country or any agency,
authority, board, bureau, central bank, commission, department or
instrumentality thereof or therein, including, without limitation, any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic, or
any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to such government or political
subdivision.
"Guarantee" shall mean the guarantee of each Guarantor
pursuant to Section 6.
"Guaranteed Obligations" see Section 6.01.
"Guarantors" shall mean Parent, each Subsidiary listed on
Schedule 1.01(d), and each direct and indirect Subsidiary that guarantees the
payment of the Obligations of Borrower under the Credit Documents pursuant to
Section 9.20.
"Guaranty Obligation" see the definition of Contingent
Obligation.
"Hazardous Material" shall mean any pollutant, contaminant,
toxic, hazardous or extremely hazardous substance, constituent or waste, or any
other constituent, waste, material, compound or substance subject to regulation
under any Environmental Law including, without limitation, petroleum or any
petroleum product, including crude oil or any fraction thereof, polychlorinated
biphenyls, urea-formaldehyde insulation and asbestos.
"in the ordinary course of business" shall mean in the
ordinary course of business of Borrower and the Subsidiaries and on ordinary
business terms.
"Increased Facility Amount" see Section 2.01(g). There is no
commitment for all or any part of the Increased Facility Amount as of the
Closing Date. No Lender shall have any obligation for any part of the Increased
Facility Amount unless it shall have expressly consented thereto in writing.
"incur" shall mean, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (including by conversion,
exchange or otherwise), assume, guarantee or otherwise become liable in respect
of such Indebtedness or other obligation or the recording, as required pursuant
to GAAP or otherwise, of any such Indebtedness or other obligation on the
balance sheet of such Person (and "incurrence," "incurred" and "incurring" shall
have meanings correlative to the foregoing). Indebtedness of any Person or any
of its Subsidiaries existing at the time such Person becomes a Company (or is
merged into or consolidates with any Company), whether or not such Indebtedness
was incurred in connection with, or in contemplation of, such Person becoming a
Company (or being merged into or consolidated with any Company), shall be deemed
incurred at the time any such Person becomes a Company or merges into or
consolidates with any Company. Neither the accrual of interest, nor the
accretion of accreted value, shall be deemed to be an incurrence.
"Indebtedness" shall mean, for any Person, without
duplication, (a) all indebtedness for borrowed money of such Person; (b) all
obligations issued, undertaken or assumed by such Person as the deferred
purchase price of Property or services (other than trade payables and accrued
expenses paid on customary terms incurred in the ordinary course of business on
ordinary terms and not more than 60 days past due); (c) all non-contingent
reimbursement or payment obligations of such Person with respect to Surety
Instruments (such as, for example, unpaid reimbursement obligations in respect
of a drawing under a letter of credit); (d) all obligations of such Person
evidenced by notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the acquisition of Property
or businesses; (e) all indebtedness of such Person created or arising under any
conditional sale or other title retention agreement, or incurred as financing,
in either case with respect to Property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such Property (other than
operating leases)); (f) all Capital Lease Obligations of such Person; (g) all
amounts required to be paid by such Person as a guaranteed payment to partners,
including any mandatory redemption of shares or interests; (h) all indebtedness
of other Persons referred to in clauses (a) through (f) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in Property (including accounts
and contracts rights) owned by such Person, whether or not such Person has
assumed or become liable for the payment of such indebtedness (provided that the
amount of indebtedness shall be deemed to be limited to the fair market value of
such Property if such Person has not assumed or become liable for the payment of
such indebtedness); and (i) all Guaranty Obligations of such Person in respect
of indebtedness or obligations of others of the kinds referred to in clauses (a)
through (g) above. Indebtedness shall not include accounts extended by suppliers
in the ordinary course of business on normal trade terms in connection with the
purchase of goods and services. The Indebtedness of any Person shall include any
Indebtedness of any partnership in which such Person is the general partner.
"Indemnitee" see Section 12.03.
"Indenture" see the definition of Parent Financing Documents.
"Initial Public Offering" shall mean a primary underwritten
public offering of the common stock of Parent, other than any public offering or
sale pursuant to a registration statement on Form S-8 or a comparable form.
"Insolvency Proceeding" shall mean, with respect to any
Person, (a) any case, action or proceeding with respect to such Person before
any court or by or before any other Governmental Authority relating to
bankruptcy, insolvency, reorganization, liquidation, receivership, dissolution,
sequestration, conservatorship, winding-up or relief of debtors (or the
convening of a meeting or the passing of a resolution for or with a view to any
of the foregoing), or (b) any assignment for the benefit of creditors,
composition, marshalling of assets for creditors, or other similar arrangement
in respect of such Person's creditors generally or any substantial portion of
its creditors.
"Intercompany Note" shall mean a promissory note substantially
in the form of Exhibit B.
"Interest Coverage Ratio" shall mean, for any Test Date, the
ratio of (x) Operating Cash Flow for the two fiscal quarters ending on such Test
Date to (y) Consolidated Interest Expense for the two fiscal quarters ending on
such Test Date to the extent thereof paid or payable in cash during such period.
For the June 30, 1998 Test Date, such Consolidated Interest Expense will be
Consolidated Interest Expense for the fiscal quarter ending on June 30, 1998
times two (2).
"Interest Period" shall mean, with respect to any LIBOR Loan,
each period commencing on the date such LIBOR Loan is made or Converted from an
ABR Loan or the last day of the next preceding Interest Period for such LIBOR
Loan and (subject to the requirements of Sections 2.01(a), 2.01(b), 2.01(c),
2.01(d) and 2.09) ending on the numerically corresponding day in the first,
second, third or sixth (or ninth or twelfth if available from all of the
Lenders) calendar month thereafter, as Borrower may select as provided in
Section 4.05, except that each Interest Period that commences on the last
Business Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) if any Interest Period for any Revolving
Credit Loan would otherwise end after the Revolving Credit Commitment
Termination Date, such Interest Period shall end on the Revolving Credit
Commitment Termination Date; (ii) no Interest Period for any Term Loan may
commence before and end after any Principal Payment Date, unless, after giving
effect thereto, the aggregate principal amount of the Term Loans having Interest
Periods that end after such Principal Payment Date shall be equal to or less
than the aggregate principal amount of the Term Loans scheduled to be
outstanding after giving effect to the payments of principal required to be made
on such Principal Payment Date; (iii) each Interest Period that would otherwise
end on a day that is not a Business Day shall end on the next succeeding
Business Day (or, if such next succeeding Business Day falls in the next
succeeding calendar month, on the next preceding Business Day); and (iv)
notwithstanding clauses (i) and (ii) above, no Interest Period shall have a
duration of less than one month and, if the Interest Period for any LIBOR Loan
would otherwise be a shorter period, such Loan shall not be available hereunder
as a LIBOR Loan for such period.
"Interest Rate Certificate" shall mean an Officers'
Certificate substantially in the form of Exhibit C, delivered pursuant to
Section 9.01(e), demonstrating in reasonable detail the calculation of the Total
Leverage Ratio as of any Test Date.
"Interest Rate Protection Agreement" shall mean, for any
Person, an interest rate swap, cap or collar agreement or similar arrangement
between such Person and one or more financial institutions providing for the
transfer or mitigation of interest risks either generally or under specific
contingencies.
"internally generated funds" shall mean funds not generated
from the proceeds of any Loan, Debt Issuance, Equity Issuance, Disposition,
insurance recovery or Indebtedness (in each case without regard to the
exclusions from the definition thereof (other than sales of inventory in the
ordinary course of business)).
"Investment" shall mean, for any Person: (a) the acquisition
(whether for cash, Property, services or securities or otherwise) of Equity
Interests, bonds, notes, debentures or other securities of any other Person; (b)
the making of any deposit with, or advance, loan or other extension of credit
to, any other Person (including the purchase of Property from another Person
subject to an understanding or agreement, contingent or otherwise, to resell
such Property to such Person); (c) any capital contribution to (by means of any
transfer of cash or other Property to others or any payment for Property or
services for the account or use of others) any other Person; and (d) the
entering into, or direct or indirect incurrence, of any Guaranty Obligation with
respect to Indebtedness or other liability of any other Person.
"Investors" shall mean the Spectrum Group, the Providence
Group and a group of investors arranged by Spectrum and Providence and party to
the New Preferred Documents.
"Issuing Lender" shall mean Toronto Dominion (Texas), Inc. or
any of its Affiliates, or such other Lender or Lenders selected by
Administrative Agent reasonably satisfactory to Borrower, as the issuer of
Letters of Credit under Section 2.03, together with its successors and assigns
in such capacity.
"Laredo Joint Venture" shall mean Texas/Illinois Cellular
Limited Partnership, a Delaware limited partnership among Southwestern Bell
Mobile Systems, Inc., as general partner, Southwestern Bell Mobile Systems,
Inc., as Class A Limited Partner, and Cellular Information Systems of Laredo,
Inc. (an affiliate of Parent), as Class B Limited Partner.
"Laredo JV Agreement" shall mean the Amended and Restated
Agreement of Limited Partnership, dated as of December 1, 1995, among
Southwestern Bell Mobile Systems, Inc., Cellular Information Systems of Laredo,
Inc., PriCellular Corporation, as a guarantor and Southwestern Bell Mobile
Systems, Inc., as a guarantor, as such agreement may be amended in effect from
time to time in accordance with its terms and this Agreement.
"Lease" shall mean any lease, sublease, franchise agreement,
license, occupancy or concession agreement.
"Lender" and "Lenders" see the introduction to this Agreement.
"Letter of Credit" see Section 2.03.
"Letter of Credit Documents" shall mean, with respect to any
Letter of Credit, collectively, any other agreements, instruments, guarantees or
other documents (whether general in application or applicable only to such
Letter of Credit) governing or providing for (a) the rights and obligations of
the parties concerned or at risk with respect to such Letter of Credit or (b)
any collateral security for any of such obligations, each as the same may be
modified and supplemented and in effect from time to time.
"Letter of Credit Interest" shall mean, for each Revolving
Credit Lender, such Lender's participation interest (or, in the case of the
Issuing Lender, the Issuing Lender's retained interest) in the Issuing Lender's
liability under Letters of Credit and such Lender's rights and interests in
Reimbursement Obligations and fees, interest and other amounts payable in
connection with Letters of Credit and Reimbursement Obligations.
"Letter of Credit Liability" shall mean, without duplication,
at any time and in respect of any Letter of Credit, the sum of (a) the undrawn
face amount of such Letter of Credit, plus (b) the aggregate unpaid principal
amount of all Reimbursement Obligations of Borrower at such time due and payable
in respect of all drawings made under such Letter of Credit.
"LIBOR Base Rate" shall mean, with respect to any LIBOR Loan
for any Interest Period therefor, the rate per annum determined by
Administrative Agent to be the arithmetic mean (rounded to the nearest 1/100th
of 1%) of the offered rates for deposits in Dollars with a term comparable to
such Interest Period that appears on the Telerate British Bankers Assoc.
Interest Settlement Rates Page (as defined below) at approximately 11:00 a.m.,
London, England time, on the second full Business Day preceding the first day of
such Interest Period; provided, however, that (i) if no comparable term for an
Interest Period is available, the LIBOR Base Rate shall be determined using the
weighted average of the offered rates for the two terms most nearly
corresponding to such Interest Period and (ii) if there shall at any time no
longer exist a Telerate British Bankers Assoc. Interest Settlement Rates Page,
"LIBOR Base Rate" shall mean, with respect to each day during each Interest
Period pertaining to LIBOR Loans comprising part of the same Borrowing, the rate
per annum equal to the rate at which Administrative Agent is offered deposits in
Dollars at approximately 11:00 a.m., London, England time, two Business Days
prior to the first day of such Interest Period in the London interbank market
for delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to its portion of the amount of
such LIBOR Loan to be outstanding during such Interest Period. "Telerate British
Bankers Assoc. Interest Settlement Rates Page" shall mean the display designated
as Page 3750 on the Telerate System Incorporated Service (or such other page as
may replace such page on such service for the purpose of displaying the rates at
which Dollar deposits are offered by leading banks in the London interbank
deposit market).
"LIBOR Loans" shall mean Loans that bear interest at rates
based on rates referred to in the definition of "LIBOR Base Rate" in this
Section 1.01.
"LIBOR Rate" shall mean, for any LIBOR Loan for any Interest
Period therefor, a rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) determined by Administrative Agent to be equal to the LIBOR Base
Rate for such Loan for such Interest Period divided by 1 minus the Reserve
Requirement (if any) for such Loan for such Interest Period.
"License Subsidiary" shall mean any Subsidiary of Borrower
that (i) is organized in a state within the United States, (ii) has no assets
other than Cellular Licenses of the Companies and conducts no activity except
holding such Cellular Licenses and matters ancillary thereto, (iii) has no
liabilities or obligations, including Contingent Obligations, other than the
Guarantee and liabilities strictly related to its corporate existence incurred
in the ordinary course (but not any trade credit or the like), and (iv) has no
Liens, except, to the extent permitted by the FCC, Liens under the Security
Documents in favor of Administrative Agent.
"Lien" shall mean, with respect to any Property, any mortgage,
lien, pledge, claim, charge, security interest or encumbrance of any kind, any
other type of preferential arrangement in respect of such Property having the
effect of a security interest or any filing consented to by any Company of any
financing statement under the UCC or any other similar notice of Lien under any
similar notice or recording statute of any Governmental Authority consented to
by any Company, including any easement, right-of-way or other encumbrance on
title to Real Property, and any agreement to give any of the foregoing. For
purposes of the Credit Documents, a Person shall be deemed to own subject to a
Lien any Property that it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement (other than an operating lease) relating to such
Property.
"Loans" shall mean the Revolving Credit Loans, the
Swing Loans and the Term Loans.
"Losses" of any Person shall mean the losses, liabilities,
claims (including those based upon negligence, strict or absolute liability and
liability in tort), damages, reasonable expenses, obligations, penalties,
actions, judgments, encumbrances, liens, penalties, fines, suits, reasonable and
documented costs or disbursements of any kind or nature whatsoever (including
reasonable fees and expenses of counsel in connection with any Proceeding
commenced or threatened in writing, whether or not such Person shall be
designated a party thereto) at any time (including following the payment of the
Obligations) incurred by, imposed on or asserted against such Person.
"Majority Lenders" shall mean (i) at any time prior to the
Closing Date, Lenders holding at least a majority of the aggregate amount of the
Commitments, and (ii) at any time after the Closing Date, Lenders holding at
least a majority of the sum of (without duplication) (a) the aggregate principal
amount of outstanding Loans (other than Swing Loans), plus (b) the aggregate
amount of all Letter of Credit Liabilities, plus (c) the aggregate Unutilized
Revolving Credit Commitments then in effect, plus (d) the aggregate Unutilized
Term Loan Commitments, plus (e) in the case of the Swing Loan Lender only, the
aggregate amount of Swing Loans then outstanding.
"Majority Revolving Credit Lenders" shall mean (i) at any time
prior to the Closing Date, Lenders holding at least a majority of the aggregate
amount of the Revolving Credit Commitments and (ii) at any time after the
Closing Date, Lenders holding at least a majority of the sum of (without
duplication) (a) the aggregate principal amount of outstanding Revolving Credit
Loans, plus (b) the aggregate amount of all Letter of Credit Liabilities, plus
(c) the aggregate Unutilized Revolving Credit Commitments then in effect, plus
(d) in the case of the Swing Loan Lender only, the aggregate amount of Swing
Loans then outstanding.
"Majority Term Lenders" shall mean (i) at any time prior to
the Closing Date, Lenders holding at least a majority of the Term Loan
Commitments, and (ii) at any time after the Closing Date, Lenders holding at
least a majority of the sum of (a) the aggregate principal amount of outstanding
Term Loans plus (b) the aggregate Unutilized Term Loan Commitments.
"Majority Tranche A Term Loan Lenders" shall mean (i) at any
time prior to the Closing Date, Lenders holding at least a majority of the
Tranche A Term Loan Commitments, and (ii) at any time after the Closing Date,
Lenders holding at least a majority of (a) the aggregate principal amount of
outstanding Tranche A Term Loans plus (b) the aggregate Unutilized Term Loan
Commitments held by all Tranche A Term Loan Lenders.
"Majority Tranche B Term Loan Lenders" shall mean (i) at any
time prior to the Closing Date, Lenders holding at least a majority of the
Tranche B Term Loan Commitments and (ii) at any time after the Closing Date,
Lenders holding at least a majority of (a) the aggregate principal amount of
outstanding Tranche B Term Loans plus (b) the aggregate Unutilized Term Loan
Commitments held by all Tranche B Term Loan Lenders.
"Majority Tranche C Term Loan Lenders" shall mean (i) at any
time prior to the Closing Date, Lenders holding at least a majority of the
Tranche C Term Loan Commitments and (ii) at any time after the Closing Date,
Lenders holding at least a majority of (a) the aggregate principal amount of
outstanding Tranche C Term Loans plus (b) the aggregate Unutilized Term Loan
Commitments held by all Tranche C Term Loan Lenders.
"Margin Stock" shall mean margin stock within the meaning of
Regulations T, U and X.
"Material Adverse Change" shall mean, with respect to any
Person, a material adverse change, or any condition or event that has resulted
or could reasonably be expected to result in a material adverse change, in the
condition (financial or otherwise), business, assets or results of operations of
such Person, individually or together with the Subsidiaries taken as a whole.
Unless otherwise indicated, Material Adverse Change refers to Borrower.
"Material Adverse Effect" shall mean, any of (a) a material
adverse effect, or any condition or event that has resulted or could reasonably
be expected to result in a material adverse effect, on the business, operations
or financial or other condition of Borrower, individually or together with the
Subsidiaries taken as a whole, (b) a material adverse effect on the ability of
the Obligors to consummate in a timely manner the Transactions or to perform any
of their material obligations under any Credit Document or (c) an adverse effect
on the legality, binding effect or enforceability of any Credit Document or any
of the material rights and remedies of the Lenders, the Issuing Lender or
Arrangers thereunder. In determining whether the occurrence of any individual
event or the existence of any individual condition would, or the failure of any
individual event to occur or any individual condition to exist would, have a
Material Adverse Effect, notwithstanding that the occurrence of such individual
event or the existence of such individual condition does not, or the failure to
occur of such individual event or such individual condition to exist does not,
of itself have such effect, a Material Adverse Effect shall be deemed to have
occurred if the cumulative effect of such event or condition or failure of event
or condition and all other then existing events or conditions and failures or
event or conditions would have a Material Adverse Effect.
"Mergers" shall mean the PriCellular Merger and the
PriCellular Wireless Merger.
"Merger Agreement" shall mean the Agreement and Plan of Merger
dated as of March 6, 1998 between American Cellular Corporation and PriCellular
Corporation, as amended and in effect in accordance with its terms and this
Agreement.
"Mortgage" shall mean an agreement, including, but not limited
to, a mortgage, deed of trust or any other document, creating and evidencing a
Lien on a Mortgaged Real Property, which shall be in form and substance
reasonably satisfactory to Administrative Agent, with such schedules and
including such provisions as shall be necessary to conform such document to
applicable or local law or as shall be customary under local law, as the same
may at any time be amended in accordance with the terms thereof and hereof.
"Mortgaged Real Property" shall mean each Real Property, if
any, which shall be subject to a Mortgage delivered after the Closing Date
pursuant to Section 9.12.
"MSA" shall mean any "metropolitan statistical area" as
defined and modified by the FCC for the purpose of licensing public cellular
radio telecommunications service systems.
"Multiemployer Plan" shall mean at any time a multiemployer
plan within the meaning of Section 4001(a)(3) of ERISA (i) to which any member
of the ERISA Group is then making or accruing an obligation to make
contributions, (ii) to which any member of the ERISA Group has within the
preceding five plan years made contributions, including for these purposes any
Person which ceased to be a member of the ERISA Group during such five year
period, or (iii) with respect to which any Company is reasonably likely to incur
liability.
"NAIC" shall mean the National Association of Insurance
Commissioners.
"Net Available Proceeds" shall mean:
(i) in the case of any Disposition Event, the amount of Net
Cash Payments received by any Company in connection with such
Disposition Event;
(ii) in the case of any Casualty Event, the aggregate amount
of proceeds of insurance, condemnation awards and other compensation
received by any Company in respect of such Casualty Event net of (A)
fees and expenses incurred by such Company in connection with recovery
thereof, (B) repayments of Indebtedness (other than Indebtedness
hereunder) to the extent secured by a Lien on such Property that is
permitted hereunder or under the applicable Security Document, and (C)
any taxes (including income, transfer, stamp, duty, customs,
withholding and any other taxes) paid or payable by any Company in
respect of the amount so recovered (after application of all credits
and other offsets); and
(iii) in the case of any Equity Issuance or any Debt Issuance,
the aggregate amount of all cash received by any Company in respect
thereof net of all investment banking fees, discounts and commissions,
legal fees, consulting fees, accountants' fees, underwriting discounts
and commissions and other customary fees and expenses, actually
incurred in connection therewith.
"Net Cash Payments" shall mean, with respect to any
Disposition Event, the aggregate amount of all cash payments (including any cash
payments received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment receivable or otherwise, but
only as and when received) received by any Company directly or indirectly in
connection with such Disposition Event; provided, however, that Net Cash
Payments shall be net (without duplication) of (i) the amount of all fees and
expenses paid by any Company in connection with such Disposition Event (the
"Relevant Disposition"); (ii) any taxes (including income, transfer, stamp,
duty, customs, withholding and any other taxes) paid or estimated to be payable
by any Company as a result of the Relevant Disposition (after application of all
credits and other offsets); (iii) any repayments by any Company of Indebtedness
other than the Obligations to the extent that (a) such Indebtedness is secured
by a Lien on the Property that is the subject of the Relevant Disposition that
is permitted hereunder or under the applicable Security Document and (b) the
transferee of (or holder of a Lien on) such Property requires that such
Indebtedness be repaid as a condition to the purchase or sale of such Property;
(iv) amounts required to be paid to any Person (other than any Company) owning a
beneficial interest in the assets subject to such Relevant Disposition; and (v)
appropriate amounts to be provided by any Company, as a reserve, in accordance
with GAAP, against any liabilities associated with such Relevant Disposition and
retained by any Company after such Relevant Disposition, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Relevant Disposition, all as reflected in an
Officers' Certificate delivered to Arrangers.
"New Lenders" see Section 2.01(g).
"New Preferred" shall mean the $325.0 million initial
liquidation preference preferred stock of Parent issued pursuant to the New
Preferred Documents on the Closing Date.
"New Preferred Documents" shall mean the certificate of
designation relating to the New Preferred, the stock purchase agreement related
thereto and all other documents related thereto (including the registration
rights relating thereto), as any such document may be amended from time to time
in accordance with its terms and this Agreement.
"Non-U.S. Lender" see Section 5.06(b).
"Note Tender" shall mean the tender offer and consent
solicitation with respect to the Existing Notes (other than the Existing
PriCellular Notes) by Borrower pursuant to the Offer to Purchase and Consent
Solicitation dated April 1, 1998 of Borrower (as successor thereunder to
Parent), as supplemented by a supplement dated April 16, 1998 and as extended
from time to time.
"Notes" shall mean the Revolving Credit Notes, the
Term Loan Notes and the Swing Loan Note.
"Notice of Assignment" shall mean a notice of assignment
pursuant to Section 12.06 substantially in the form of Exhibit F.
"Notice of Borrowing" shall mean a notice of borrowing
substantially in the form of Exhibit G.
"Obligations" shall mean all amounts, direct or indirect,
contingent or absolute, of every type or description, and at any time existing,
owing to any Creditor or any of its Related Parties or their respective
successors, transferees or assignees pursuant to the terms of any Credit
Document or any Swap Contract or secured by any of the Security Documents,
whether or not the right of such Person to payment in respect of such
obligations and liabilities is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured and whether or not such claim is discharged, stayed or
otherwise affected by any bankruptcy case or insolvency or liquidation
proceeding.
"Obligors" shall mean Borrower and the Guarantors.
"Officers' Certificate" shall mean, as applied to any
corporation, a certificate executed on behalf of such corporation by its
Chairman of the Board (if an officer) or its Chief Executive Officer or its
President or one of its Vice Presidents (or an equivalent officer) and by its
Chief Financial Officer, Vice President-Finance or its Treasurer (or an
equivalent officer) or any Assistant Treasurer in their official (and not
individual) capacities; provided, however, that every Officers' Certificate with
respect to the compliance with a condition precedent to the making of any Loan
or the taking of any other action hereunder shall include (i) a statement that
the officers making or giving such Officers' Certificate have read such
condition and any definitions or other provisions contained in this Agreement
relating thereto, and (ii) a statement as to whether, in the opinion of the
signers, such condition has been complied with.
"Operating Cash Flow" shall mean, for any period, the sum
(without duplication) of the amounts for such period of Adjusted Net Income,
plus, in each case to the extent deducted in calculating such Adjusted Net
Income, (i) income tax expense, (ii) Consolidated Interest Expense plus any
other interest expense which in accordance with GAAP was deducted in determining
Adjusted Net Income for such period, (iii) depreciation expense and amortization
expense, and (iv) the non-cash component of any item of expense, other than to
the extent requiring an accrual or reserve for future cash expenses, all as
determined on a consolidated basis for Borrower and its Consolidated
Subsidiaries, and minus (i) cash dividends or other distributions paid by
Borrower during such period to Parent pursuant to Section 9.10(c)(i), and (ii)
distributions received from the Laredo Joint Venture during such period to the
extent included in calculating such Adjusted Net Income. If Operating Cash Flow
is being calculated for any period that begins prior to the Closing Date, the
portion of such period prior to the Closing Date shall be calculated on a
consolidated basis for PriCellular and its Consolidated Subsidiaries (other than
distributions received from the Laredo Joint Venture).
"Original Lenders" shall mean the Lenders named on the
signature pages hereof who were Lenders at the Closing Date.
"Organic Document" shall mean, relative to any Person, its
certificate of incorporation, its by-laws, its partnership agreement, its
memorandum and articles of association, share designations or similar
organization documents and all shareholder agreements, voting trusts and similar
arrangements applicable to any of its authorized shares of Equity Interests.
"Other Taxes" see Section 5.06(c).
"Parent" shall mean American Cellular Corporation, a
Delaware corporation.
"Parent Financing" shall mean the issuance and sale of the
Parent Notes for gross proceeds of not less than $282.0 million.
"Parent Financing Documents" shall mean the Indenture dated
May 13, 1998 pursuant to which the Parent Notes were issued (the "Indenture"),
the Exchange Indenture, the Parent Interest Escrow Agreement and all other
documents relating thereto and delivered to Arrangers, as any such agreement or
document may be amended and in effect from time to time in accordance with its
terms and this Agreement.
"Parent Interest Escrow Agreement" shall mean that certain
Pledge Escrow and Assignment Agreement dated as of May 13, 1998 between Parent
and Chase Manhattan Bank and Trust Company, National Association, as trustee,
pursuant to which proceeds from the Parent Financing sufficient to fund the
first six scheduled semiannual interest payments will be held in escrow for the
benefit of the Parent Notes.
"Parent Interest Trigger Date" shall mean the earlier of (x)
the sixth scheduled semiannual interest payment date on the Parent Notes as of
the Closing Date or (y) the first date on which cash interest is payable on any
Permitted Refinancing of the Parent Notes (or any one or more refinancings
thereof) other than from an interest escrow agreement on terms substantially
identical to the terms of the Parent Interest Escrow Agreement as in effect on
the Closing Date.
"Parent Notes" shall mean the 10 1/2% Senior Notes due 2008 of
Parent in an aggregate principal amount of $285.0 million issued pursuant to the
Parent Financing Documents, including the senior notes issued pursuant to a
registered exchange offer (the "Exchange Offer") therefor made pursuant to the
registration rights agreement entered into in connection with the issuance
thereof on the date of issuance thereof (the "Exchange Notes").
"Participant" see Section 12.06(c).
"Payment Date" shall mean any Principal Payment Date and each
date on which interest is due and payable on any Loan.
"Payor" see Section 4.06.
"PBGC" shall mean the United States Pension Benefit Guaranty
Corporation or any successor thereto.
"Permits" see Section 8.17.
"Permitted Acquisition" shall mean any Acquisition effected in
compliance with Section 9.06(h), (i), (p) or (r).
"Permitted Investments" shall mean, for any Person: (a) direct
obligations of the United States of America, or of any agency thereof, or
obligations guaranteed as to principal and interest by the United States of
America, or by any agency thereof, in either case maturing not more than one
year from the date of acquisition thereof by such Person; (b) time deposits,
certificates of deposit or bankers' acceptances (including eurodollar deposits)
issued by any bank or trust company organized under the laws of the United
States of America or any state thereof and having capital, surplus and undivided
profits of at least $500.0 million and a deposit rating of investment grade; (c)
commercial paper rated A-1 or better by Standard & Poor's Corporation or P-1 or
better by Moody's Investors Service, Inc., respectively, maturing not more than
180 days from the date of acquisition thereof by such Person; (d) repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (a) above entered into with a bank meeting the
qualifications described in clause (b) above; (e) securities with maturities of
six months or less from the date of acquisition issued or fully guaranteed by
any state, commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least A by
Standard & Poor's Corporation or A by Moody's Investors Service, Inc.; or (f)
money market mutual funds that invest primarily in the foregoing items.
"Permitted Liens" see Section 9.07.
"Permitted Refinancing" shall mean, with respect to any
Indebtedness or Contingent Obligation, any refinancing thereof, provided,
however, that (w) no Default shall have occurred and be continuing or would
arise therefrom, (x) any such refinancing Indebtedness shall (I) not be on
financial and other terms that are more onerous (as determined by Borrower and
Arrangers) to any Company or Creditor than the Indebtedness or Contingent
Obligation being refinanced and shall not have defaults, rights or remedies more
burdensome (as determined by Borrower and Arrangers) to any Company or Creditor
than the Indebtedness being refinanced, (II) not have a stated maturity or
weighted average life that is shorter than the Indebtedness or Contingent
Obligation being refinanced, (III) if the Indebtedness or Contingent Obligation
being refinanced is subordinated by its terms or by the terms of any agreement
or instrument relating to such Indebtedness or Contingent Obligation, be at
least as subordinate to the Obligations as the Indebtedness or Contingent
Obligation being refinanced (and unsecured if the refinanced Indebtedness is
unsecured), and (IV) be in principal amount that does not exceed the principal
amount so refinanced, plus the lesser of (1) the stated amount of any premium or
other payment required to be paid in connection with such refinancing pursuant
to the terms of the Indebtedness or Contingent Obligation being refinanced and
(2) the amount of premium or other payment actually paid at such time to
refinance the Indebtedness, plus, in either case, the amount of fees and
reasonable expenses of any Obligor or any Subsidiary incurred in connection with
such refinancing, (y) the sole obligor on such refinancing Indebtedness or
Contingent Obligation shall be Parent or the original obligor on such
Indebtedness or Contingent Obligation being refinanced; provided, however, that
(I) any guarantor of the Indebtedness or Contingent Obligation being refinanced
shall be permitted to guarantee the refinancing Indebtedness, (II) Parent shall
be permitted to guarantee any such refinancing of Borrower or any Qualified
Subsidiary and (III) Borrower shall be permitted to guarantee any such
refinancing of any Qualified Subsidiary, and (z) any refinancing of the Parent
Notes (or any refinancing thereof) shall provide for an interest escrow (or
non-cash interest) through the date that as of the Closing Date would have been
the originally regularly scheduled sixth interest payment date on the Parent
Notes on terms and conditions satisfactory to Arrangers.
"Permitted Transferee" shall mean, with respect to any
individual, (i) such individual's spouse or children (natural or adopted), any
trust for such individual's benefit or the benefit of such individual's spouse
or children (natural or adopted), or any corporation or partnership in which the
direct and beneficial owner of all of the equity interest is such Person or such
individual's spouse or children (natural or adopted) or any trust for the
benefit of such persons; or (ii) the heirs, executors, administrators or
personal representatives upon the death of such person or upon the incompetency
or disability of such person for purposes of the protection and management of
such individual's assets.
"Person" shall mean any individual, corporation, company,
voluntary association, partnership, joint venture, trust, unincorporated
organization or government (or any agency, instrumentality or political
subdivision thereof).
"Plan" shall mean at any time an employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code or
Section 302 of ERISA and is maintained or contributed to by any member of the
ERISA Group or with respect to which any Company or Unrestricted Subsidiary is
reasonably likely to incur liability.
"Pledged Collateral" shall have the meaning set forth in the
Security Agreement or in the Unrestricted Subsidiary Pledge Agreement, as the
case may be.
"PriCellular" shall mean PriCellular Corporation, a Delaware
corporation, which is to be renamed American Cellular Corporation upon
consummation of the Mergers.
"PriCellular Acquisition" shall mean the acquisition of
PriCellular by Parent pursuant to the terms and subject to the conditions of the
Merger Agreement.
"PriCellular Balance Sheet" shall mean the balance sheet of
PriCellular as of December 31, 1997 included on the Form 10-K filed by
PriCellular with the Commission.
"PriCellular Merger" shall mean the merger on the Closing Date
of Parent with and into PriCellular, with PriCellular as the survivor pursuant
to the Merger Agreement.
"PriCellular Wireless" shall mean PriCellular Wireless
Corporation, a Delaware corporation.
"PriCellular Wireless Merger" shall mean the merger on the
Closing Date of PriCellular Wireless with and into Borrower, with Borrower as
the survivor.
"Prime Rate" shall mean for any day, a rate per annum that is
equal to the corporate base rate of interest established by Administrative Agent
from time to time, changing when and as said corporate base rate changes. The
corporate base rate is not necessarily the lowest rate charged by Administrative
Agent to its customers.
"Principal Office" shall mean the principal office of
Administrative Agent, located on the date hereof at Toronto Dominion (Texas),
Inc., 909 Fannin, Suite 1700, Houston, Texas 77010 or such other office as may
be designated by Administrative Agent.
"Principal Payment Date" shall mean, with respect to any Term
Loan, each Quarterly Date or other date set forth on Schedule 3.01(b) on which a
payment of principal is due with respect to such Term Loan.
"Prior Liens" shall mean Liens which, pursuant to the
provisions of any Security Document, are or may be superior to the Lien of such
Security Document.
"Proceeding" shall mean any claim, counterclaim, action,
judgment, suit, hearing, governmental investigation, arbitration or proceeding,
including by or before any Governmental Authority and whether judicial or
administrative.
"Profit Payment Agreement" shall mean any agreement to make
any payment the amount of which is, or the terms of payment of which are, in any
respect subject to or contingent upon the revenues, income, cash flow or profits
(or the like) of any Person or business.
"Pro Forma Balance Sheets" see Section 8.02(d).
"Pro Forma Date" see Section 8.02(d).
"Pro Forma Debt Service" shall mean, for any period, the sum
of (i) the reasonably anticipated Consolidated Interest Expense of Borrower and
its Consolidated Subsidiaries for such period to the extent to be paid in cash
during such period and assuming prevailing interest rates at the time of
calculation, and (ii) the combined sum of all scheduled principal payments on
any Indebtedness (including, without duplication, the Loans and Capital Leases)
of Borrower and its Consolidated Subsidiaries during such period; provided,
however, that such Consolidated Interest Expense shall include interest that
will accrue after the Parent Interest Trigger Date during such period on the
Parent Notes.
"Pro Forma Debt Service Coverage Ratio" shall mean, for any
Test Date, the ratio of Annualized Operating Cash Flow for such Test Date to Pro
Forma Debt Service for the four fiscal quarters immediately following such Test
Date.
"Property" shall mean any right, title or interest in or to
property or assets of any kind whatsoever, whether real, personal or mixed and
whether tangible or intangible and including Equity Interests or other ownership
interests of any Person.
"Providence" shall mean Providence Equity Partners, L.P., a
Delaware limited partnership.
"Providence Group" shall mean Providence and any of its
Affiliates controlled by it, including any limited partnership of which
Providence or its general partner (or the general partners of such general
partner) is the general partner.
"Qualified Capital Stock" shall mean with respect to any
Person any Equity Interests of such Person which is not Disqualified Capital
Stock.
"Qualified Subsidiary" shall mean any Subsidiary of Borrower
that is an Obligor and of which not less than 90% (on a fully diluted basis) of
the voting power of the voting Equity Interests and 90% (on a fully diluted
basis) of the economic interests are owned directly or indirectly by Borrower.
"Qualifying Acquisition" shall mean any Acquisition that would
otherwise be a Permitted Acquisition and that either (i) shall have been
approved by Arrangers and the Majority Lenders or (ii) after giving pro forma
effect thereto in accordance with GAAP the Total Leverage Ratio as of the most
recent Test Date would be less than or equal to 6.5:1.0 (assuming such
Acquisition were consummated as of the first day of the relevant measurement
period ended as of such Test Date) as evidenced in an Officers' Certificate
delivered by Borrower to Arrangers and the Lenders at least 10 Business Days
prior to the consummation thereof certifying to such pro forma Total Leverage
Ratio (attaching back up data and calculations).
"Quarter" shall mean each three month period ending on March
31, June 30, September 30 and December 31.
"Quarterly Dates" shall mean the last Business Day of March,
June, September and December in each year, commencing with the last Business Day
of September, 1998.
"Real Property" shall mean all right, title and interest of
any Company (including, without limitation, any leasehold estate) in and to a
parcel of real property owned or operated by any Company, whether by lease,
license or other use agreement, together with, in each case, all improvements
and appurtenant fixtures, equipment, personal property, easements and other
property and rights incidental to the ownership, lease or operation thereof or
thereon.
"redeem" shall mean redeem, repurchase, repay, defease or
otherwise acquire or retire for value; and "redemption" and "redeemed" have
correlative meanings.
"refinance" shall mean refinance, renew, extend, replace,
defease or refund, in whole or in part, including successively; and
"refinancing" and "refinanced" have correlative meanings.
"Register" see Section 2.08.
"Regulation D" shall mean Regulation D (12 C.F.R. Part 204) of
the Board of Governors of the United States Federal Reserve System.
"Regulations T, U and X" shall mean, respectively, Regulation
T (12 C.F.R. Part 220), Regulation U (12 C.F.R. Part 221) and Regulation X (12
C.F.R. Part 224) of the Board of Governors of the United States Federal Reserve
System (or any successor), as the same may be modified and supplemented and in
effect from time to time.
"Regulatory Change" shall mean, with respect to any Lender,
any change after the date hereof in United States Federal, state or foreign law
or regulations (including Regulation D) or the adoption or making after such
date of any interpretation, directive or request applying to a class of banks or
other financial institutions including such Lender of or under any Federal,
state or foreign law or regulations (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) by any court or
governmental or monetary authority or any other regulatory agency with proper
authority, including non-governmental agencies or bodies, charged with the
interpretation or administration thereof or by the NAIC.
"Reimbursement Obligations" shall mean, at any time, the
obligations of Borrower then outstanding, or that may thereafter arise in
respect of all Letters of Credit then outstanding, to reimburse amounts paid by
the Issuing Lender in respect of any drawings under a Letter of Credit.
"Related Parties" see Section 11.01.
"Release" shall mean any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the environment.
"Replaced Lender" see Section 2.11.
"Replacement Lender" see Section 2.11.
"Required Payment" see Section 4.06.
"Requirement of Law" shall mean as to any Person, the
Certificate of Incorporation and By-Laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its Property or to
which such Person or any of its Property is subject.
"Reserve Requirement" shall mean, for any Interest Period for
any LIBOR Loan, the average maximum rate at which reserves (including any
marginal, supplemental or emergency reserves) are required to be maintained
during such Interest Period under Regulation D by member banks of the United
States Federal Reserve System in New York City with deposits exceeding one
billion Dollars against "Eurocurrency liabilities" (as such term is used in
Regulation D).
"Reset Date" see the definition of Applicable Margin.
"Responsible Officer" shall mean the chief executive officer
of Borrower and the president of Borrower (if not the chief executive officer)
and, with respect to financial matters, the chief financial officer of Borrower.
"Revolving Credit Commitment" shall mean, for each Revolving
Credit Lender, the obligation of such Lender to make Revolving Credit Loans in
an aggregate principal amount at any one time outstanding up to but not
exceeding the amount set opposite the name of such Lender on Annex A under the
caption "Revolving Credit Commitment" (as the same may be reduced from time to
time pursuant to Section 2.04 or changed pursuant to Section 12.06(b)). The
initial aggregate principal amount of the Revolving Credit Commitments is $150.0
million.
"Revolving Credit Commitment Percentage" shall mean, with
respect to any Revolving Credit Lender, the ratio of (a) the amount of the
Revolving Credit Commitment of such Lender to (b) the aggregate amount of the
Revolving Credit Commitments of all of the Lenders.
"Revolving Credit Commitment Termination Date" shall mean
December 31, 2006. If the Revolving Credit Commitments are increased pursuant to
Section 2.01(g), the Revolving Credit Commitment Termination Date with respect
to such increased portion may be extended by Arrangers beyond the date specified
in the preceding sentence.
"Revolving Credit Commitments" shall mean the aggregate sum of
the Revolving Credit Commitments.
"Revolving Credit Facility" shall mean the credit facility
comprising the Revolving Credit Commitment of all of the Revolving Credit
Lenders.
"Revolving Credit Lenders" shall mean (a) on the date hereof,
the Lenders having Revolving Credit Commitments on the signature pages hereof
and (b) thereafter, the Lenders from time to time holding Revolving Credit Loans
and Revolving Credit Commitments after giving effect to any assignments thereof
permitted by Section 12.06(b).
"Revolving Credit Loans" see Section 2.01(a).
"Revolving Credit Notes" shall mean the promissory notes
provided for by Section 2.08(a) and all promissory notes delivered in
substitution or exchange therefor, in each case as the same shall be modified
and supplemented and in effect from time to time.
"RSA" shall mean any "rural service area" as defined and
modified by the FCC for the purpose of licensing public cellular radio
telecommunications service systems.
"Security Agreement" shall mean a Security Agreement
substantially in the form of Exhibit D-1 among the Obligors and Administrative
Agent, as the same may be amended in accordance with the terms thereof and
hereof or such other agreements reasonably acceptable to Administrative Agent as
shall be necessary to comply with applicable Requirements of Law and effective
to grant to Administrative Agent a perfected first priority security interest in
the Pledged Collateral covered thereby.
"Security Documents" shall mean the Security Agreement, the
Mortgages (if any), the Unrestricted Subsidiary Pledge Agreement, the Collateral
Assignment of Location Agreements and each other security document or pledge
agreement required by applicable local law to grant a valid, perfected security
interest in any property or asset acquired or developed pursuant to a Permitted
Acquisition, and all UCC or other financing statements or instruments of
perfection required by this Agreement, the Security Agreement, the Unrestricted
Subsidiary Pledge Agreement or any Mortgage to be filed with respect to the
security interests in Property and fixtures created pursuant to the Security
Agreement or any Mortgage and any other document or instrument utilized to
pledge as collateral for the Obligations any Property of whatever kind or
nature.
"Senior Debt" shall mean, at any date, Total Debt less (A)
Subordinated Debt and (B) the Parent Notes at such date.
"Senior Leverage Ratio" shall mean, for any Test Date, the
ratio of (x) Senior Debt at such Test Date to (y) Annualized Operating Cash Flow
for such Test Date.
"Significant Unrestricted Subsidiary" shall mean at any date
(x) any Unrestricted Subsidiary of Borrower whose assets constitute 7.5% or more
of the consolidated total assets of Borrower and its Subsidiaries and
Unrestricted Subsidiaries, and (y) any Unrestricted Subsidiary of Borrower that
if aggregated at such date with all other Unrestricted Subsidiaries of Borrower
in respect of which events specified in Section 10(e), (f) or (g) have occurred
and are continuing at such date would be a Significant Unrestricted Subsidiary
pursuant to clause (x) of this definition.
"Solvent" and "Solvency" shall mean, for any Person on a
particular date, that on such date (a) the fair value of the Property of such
Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person, (b) the present fair salable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as they
become absolute and matured, (c) such Person does not intend to, and does not
believe that it will, incur debts and liabilities beyond such Person's ability
to pay as such debts and liabilities mature, (d) such Person is not engaged in a
business or a transaction, and is not about to engage in a business or a
transaction, for which such Person's Property would constitute an unreasonably
small capital and (e) such Person is able to pay its debts as they become due
and payable.
"Specified Cellular System Information" shall mean, for each
Cellular System cluster as of the last date of the most recent period that
financial statements are delivered pursuant to Section 9.01(a) or 9.01(b), the
following information: (i) market penetration of Borrower and its Subsidiaries;
(ii) Net Pops for that market; (iii) monthly churn (as such term is used in the
cellular telecommunications industry); (iv) monthly revenue per subscriber for
that period; (v) the number of subscribers at the end of such period; (vi)
Capital Expenditures per net subscriber added in that period; (vii) roaming
revenue for that period as a percentage of total revenue for that period; and
(viii) marketing costs per net subscriber added in that period.
"Spectrum" shall mean Spectrum Equity Investors II, L.P., a
Delaware limited partnership.
"Spectrum Group" shall mean Spectrum and any of its Affiliates
controlled by it, including any limited partnership of which Spectrum or its
general partner (or the general partners of such general partner) is the general
partner.
"State PUC" shall mean any state public utility commission or
any other state commission, agency, department, board or authority with
responsibility for regulating intrastate and local telecommunications services.
"Statutes" see Section 8.22(e).
"Subordinated Debt" shall mean Indebtedness of any Company
that is subordinated to any other Indebtedness of such Company.
"Subsidiary" shall mean, with respect to any Person, any
corporation, partnership or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation, partnership or
other entity shall have or might have voting power by reason of the happening of
any contingency) is at the time directly or indirectly owned or controlled by
such Person or one or more Subsidiaries of such Person or by such Person and one
or more Subsidiaries of such Person. Unless the context clearly requires
otherwise, all references to any Subsidiary shall mean a Subsidiary of Borrower.
All references to any Subsidiary of Borrower shall include all those Persons
which become Subsidiaries of Borrower upon consummation of the Mergers. Other
than for purposes of the definition of "Unrestricted Subsidiary," unless
otherwise indicated, all reference herein to any Subsidiary of Parent or
Borrower shall not include any Unrestricted Subsidiary.
"Supermajority Lenders" shall mean (i) at any time prior to
the Closing Date, Lenders holding at least two-thirds of the aggregate amount of
the Commitments and (ii) at any time after the Closing Date, Lenders holding at
least two-thirds of the sum of (without duplication) (a) the aggregate principal
amount of outstanding Loans (other than Swing Loans), plus (b) the aggregate
amount of all Letter of Credit Liabilities, plus (c) the aggregate unused amount
of Revolving Credit Commitments then in effect, plus (d) the aggregate
Unutilized Term Loan Commitments plus (e) in the case of the Swing Loan Lender
only, the aggregate amount of Swing Loans then outstanding.
"Supermajority Lenders of the Affected Class" shall mean (i)
at any time prior to the Closing Date, Lenders holding at least two-thirds of
the aggregate amount of the Commitments of the applicable tranche of Term Loan
Commitments which would be affected by any modification, supplement or waiver
contemplated by clause (e) or (f) to the proviso to Section 12.04(i), and (ii)
at any time after the Closing Date, Lenders holding at least two-thirds of the
sum of the aggregate amount of the outstanding Loans plus the aggregate
Unutilized Term Loan Commitments of the applicable tranche of Term Loans which
would be affected by any modification, supplement or waiver contemplated by
clause (e) or (f) to the proviso to Section 12.04(i).
"Supplemental Indentures" see Section 7.01(xi).
"Surety Instruments" shall mean all letters of credit
(including standby and commercial), bankers' acceptances, bank guarantees,
surety bonds and similar instruments.
"Survey" shall mean a survey of any Mortgaged Real Property
(and all improvements thereon): (i) prepared by a surveyor or engineer licensed
to perform surveys in the state, province or country where such Mortgaged Real
Property is located, (ii) dated (or redated) not earlier than 6 months prior to
the date of delivery thereof unless there shall have occurred after the date of
such survey any exterior construction on the site of such Mortgaged Real
Property, in which event such survey shall be dated (or redated) after the
completion of such construction or, if such construction shall not have been
completed as of such date of delivery, not earlier than 20 days prior to such
date of delivery, (iii) certified by the surveyor (in a manner acceptable to
Administrative Agent) to Administrative Agent and (iv) complying in all respects
with Requirements of Law.
"Swap Contract" shall mean any agreement entered into in the
ordinary course of business (as a bona fide hedge and not for speculative
purposes) (including any master agreement and any agreement, whether or not in
writing, relating to any single transaction) that is an interest rate swap
agreement, basis swap, forward rate agreement, commodity swap, commodity option,
equity or equity index swap or option, bond option, interest rate option,
foreign exchange agreement, rate cap, collar or floor agreement, currency swap
agreement, cross-currency rate swap agreement, swaption, currency option or any
other similar agreement (including any option to enter into any of the
foregoing) and is designed to protect the Obligors against fluctuations in
interest rates, currency exchange rates, or similar risks (including any
Interest Rate Protection Agreement entered into pursuant to Section 9.18).
"Swap Excess Cash Basket" shall mean, at any date, the gross
proceeds for Dispositions that at such date could be (and have not yet been as
of the time of consummation of the transaction under consideration) received by
Borrower or any Subsidiary in connection with any Disposition (after giving
effect to any pending Dispositions) effected pursuant to Section 9.06(g).
"Swing Loan Commitment" shall mean the obligation of the Swing
Loan Lender to make or continue Swing Loans hereunder in an aggregate principal
amount up to but not exceeding $10.0 million, as the same may be reduced or
terminated pursuant to Section 2.04 or Section 10, it being understood that the
Swing Loan Commitment is part of the Revolving Credit Commitment of the Swing
Loan Lender, rather than a separate, independent commitment.
"Swing Loan Lender" shall mean Toronto Dominion (Texas), Inc.
and its successors and assigns in such capacity.
"Swing Loan Maturity Date" shall mean the Revolving Credit
Commitment Termination Date.
"Swing Loan Note" shall mean the promissory note made by
Borrower evidencing the Swing Loans, in the form of Exhibit A-5.
"Swing Loans" see Section 2.01(f).
"Syndication Agent" see the introduction hereto.
"Tax Returns" see Section 8.09.
"Taxes" shall mean any and all taxes, imposts, duties,
charges, fees, levies or other charges or assessments of whatever nature,
including income, gross receipts, excise, real or personal property, sales,
withholding, social security, retirement, unemployment, occupation, use,
service, license, net worth, payroll, franchise, and transfer and recording,
imposed by the Internal Revenue Service or any taxing authority (whether
domestic or foreign, including any federal, state, U.S. possession, county,
local or foreign government or any subdivision or taxing agency thereof),
whether computed on a separate, consolidated, unitary, combined or any other
basis, including interest, fines, penalties or additions to tax attributable to
or imposed on or with respect to any such taxes, charges, fees, levies or other
assessments.
"Term Loan Commitments" shall mean the Tranche A Term Loan
Commitments, the Tranche B Term Loan Commitments and the Tranche C Term Loan
Commitments, collectively.
"Term Loan Facilities" shall mean the credit facilities
comprising the Term Loan Commitments.
"Term Loan Lenders" shall mean the Tranche A Term Loan
Lenders, the Tranche B Term Loan Lenders and the Tranche C Term Loan Lenders,
collectively.
"Term Loan Notes" shall mean the Tranche A Term Loan Notes,
the Tranche B Term Loan Notes and the Tranche C Term Loan Notes, collectively.
"Term Loan Tranches" shall mean the Term Loans outstanding
under the Tranche A Term Loans, the Tranche B Term Loans and the Tranche C Term
Loans, collectively, and "Term Loan Tranche" shall mean any of them.
"Term Loans" shall mean the Tranche A Term Loans, the Tranche
B Term Loans and the Tranche C Term Loans, collectively.
"Test Date" shall mean, for any Financial Maintenance
Covenant, the last day of each fiscal quarter included within any period set
forth in the table for such Financial Maintenance Covenant. Compliance with the
Financial Maintenance Covenants shall be tested, as of each Test Date, on the
date on which financial statements pursuant to Section 9.01(a) or (b) have been,
or should have been, delivered for the applicable fiscal period.
"Title Company" shall mean First American Title Insurance
Company or such other title insurance or abstract company as shall be designated
by Arrangers.
"Total Debt" shall mean, at any date, the aggregate amount of
Indebtedness of Borrower and its Consolidated Subsidiaries as of such date
determined on a consolidated basis in accordance with GAAP, net of (A) up to
$3.0 million in cash held at such date by Borrower or any Qualified Subsidiary,
not in the Collateral Account and (B) all cash held in the Collateral Account at
such date that resulted from any Disposition of a Cellular System of Borrower or
any Subsidiary.
"Total Leverage Ratio" shall mean, for any Test Date, the
ratio of (x) the sum of (1) Total Debt at such Test Date, plus (2) if such date
is on or after the Parent Interest Trigger Date, the aggregate principal amount
of Parent Notes outstanding on such date to (y) Annualized Operating Cash Flow
for such Test Date.
"Tranche A Term Loan Commitment" shall mean, for each Tranche
A Term Loan Lender, the obligation of such Lender to make a Tranche A Term Loan
in an amount up to but not exceeding the amount set opposite the name of such
Lender on Annex A under the caption "Tranche A Term Loan Commitment" (as the
same may be changed pursuant to Section 12.06(b)). The initial aggregate
principal amount of the Tranche A Term Loan Commitments is $450.0 million.
"Tranche A Term Loan Commitment Percentage" shall mean, with
respect to any Tranche A Term Loan Lender, the ratio of (a) the amount of the
Tranche A Term Loan Commitment of such Lender to (b) the Tranche A Term Loan
Commitments.
"Tranche A Term Loan Commitments" shall mean the aggregate sum
of the Tranche A Term Loan Commitment of all the Lenders.
"Tranche A Term Loan Lenders" shall mean (a) on the date
hereof, the Lenders having Tranche A Term Loan Commitments on the signature
pages hereof, and (b) thereafter, the Lenders from time to time holding Tranche
A Term Loans and Tranche A Term Loan Commitments after giving effect to any
assignments thereof permitted by Section 12.06(b).
"Tranche A Term Loan Notes" shall mean the promissory notes
provided for by Section 2.08(a)(ii) and all promissory notes delivered in
substitution or exchange therefor, in each case as the same shall be modified
and supplemented and in effect from time to time.
"Tranche A Term Loans" shall mean the loans provided for by
Section 2.01(b), which may be ABR Loans and/or LIBOR Loans.
"Tranche B Term Loan Commitment" shall mean, for each Tranche
B Term Loan Lender, the obligation of such Lender to make a Tranche B Term Loan
in an amount up to but not exceeding the amount set opposite the name of such
Lender on Annex A under the caption "Tranche B Term Loan Commitment" (as the
same may be changed pursuant to Section 12.06(b)). The initial aggregate
principal amount of the Tranche B Term Loan Commitments is $200.0 million.
"Tranche B Term Loan Commitment Percentage" shall mean, with
respect to any Tranche B Term Loan Lender, the ratio of (a) the amount of the
Tranche B Term Loan Commitment of such Lender to (b) the Tranche B Term Loan
Commitments.
"Tranche B Term Loan Commitments" shall mean the aggregate sum
of the Tranche B Term Loan Commitment of all the Lenders.
"Tranche B Term Loan Lenders" shall mean (a) on the date
hereof, the Lenders having Tranche B Term Loan Commitments on the signature
pages hereof, and (b) thereafter, the Lenders from time to time holding Tranche
B Term Loans and Tranche B Term Loan Commitments after giving effect to any
assignments thereof permitted by Section 12.06(b).
"Tranche B Term Loan Notes" shall mean the promissory notes
provided for by Section 2.08(a)(iii) and all promissory notes delivered in
substitution or exchange therefor, in each case as the same shall be modified
and supplemented and in effect from time to time.
"Tranche B Term Loans" shall mean the loans provided for by
Section 2.01(c), which may be ABR Loans and/or LIBOR Loans.
"Tranche C Term Loan Commitment" shall mean, for each Tranche
C Term Loan Lender, the obligation of such Lender to make a Tranche C Term Loan
in an amount up to but not exceeding the amount set opposite the name of such
Lender on Annex A under the caption "Tranche C Term Loan Commitment" (as the
same may be changed pursuant to Section 12.06(b)). The initial aggregate
principal amount of the Tranche C Term Loan Commitments is $200.0 million.
"Tranche C Term Loan Commitment Percentage" shall mean, with
respect to any Tranche C Term Loan Lender, the ratio of (a) the amount of the
Tranche C Term Loan Commitment of such Lender to (b) the Tranche C Term Loan
Commitments.
"Tranche C Term Loan Commitments" shall mean the aggregate sum
of the Tranche C Term Loan Commitment of all the Lenders.
"Tranche C Term Loan Lenders" shall mean (a) on the date
hereof, the Lenders having Tranche C Term Loan Commitments on the signature
pages hereof, and (b) thereafter, the Lenders from time to time holding Tranche
C Term Loans and Tranche C Term Loan Commitments after giving effect to any
assignments thereof permitted by Section 12.06(b).
"Tranche C Term Loan Notes" shall mean the promissory notes
provided for by Section 2.08(a)(iv) and all promissory notes delivered in
substitution or exchange therefor, in each case as the same shall be modified
and supplemented and in effect from time to time.
"Tranche C Term Loans" shall mean the loans provided for by
Section 2.01(d), which may be ABR Loans and/or LIBOR Loans.
"Transaction Documents" shall mean the Merger Agreement, the
New Preferred Documents and the Parent Financing Documents and all documents
related thereto and all exhibits, appendices, schedules and annexes to any
thereof.
"Transactions" shall mean the Mergers, the Parent Note
Financing, the Equity Financing, the Note Tender, the Existing Credit Facility
Repayment and the borrowings hereunder on the Closing Date.
"Type" see Section 1.03.
"UCC" shall mean the Uniform Commercial Code as in effect in
the applicable state or jurisdiction.
"Unrestricted Subsidiary" shall mean any Subsidiary of Parent,
other than Borrower, that, at the time of determination, shall be an
Unrestricted Subsidiary (as designated by the Board of Directors of Parent, as
provided below). The Board of Directors of Parent may designate any Subsidiary
of Parent, other than Borrower (including any newly acquired or newly formed
Subsidiary at or prior to the time it is so formed or acquired), to be an
Unrestricted Subsidiary if (a) no Default is existing or will occur as a
consequence thereof (provided that for purposes of testing covenant compliance
with Section 9.11, all such determinations shall be made as of the Test Date
immediately preceding the proposed date of designation of any Subsidiary as an
Unrestricted Subsidiary and giving pro forma effect thereto), (b) such
Subsidiary does not own any Equity Interests of, or own or hold any Lien on any
Property of, any Company, (c) such Subsidiary and each of its Subsidiaries has
not at the time of designation, and does not thereafter, create, incur, issue,
assume, guarantee, or otherwise become directly or indirectly liable with
respect any Indebtedness pursuant to which the lender has recourse to any
Property of any Company (except that such Subsidiary and its Subsidiaries may
become Guarantors if permitted by the Parent Financing Documents and consented
to by Arrangers), (d) a default by such Person on any of its Indebtedness will
not result in, or permit any holder of Indebtedness of any Company to declare, a
default on such Indebtedness of any Company or cause the payment thereof to be
accelerated or payable prior to its stated maturity, except with respect to
events specified in Section 10(e), (f) or (g) relating to any Significant
Unrestricted Subsidiary on the same or similar terms as set forth in such
Sections, and (e) if such Subsidiary is a Subsidiary of Borrower, at the time of
such designation (and prior to any Investment therein (other than any Investment
permitted by Section 9.09(A)(r)) that is not de minimis) such Subsidiary shall
not have more than de minimis assets, other than any such Investment permitted
by Section 9.09(A)(r). Any Subsidiary of an Unrestricted Subsidiary shall be an
Unrestricted Subsidiary for purposes of this Agreement. Each such designation
shall be evidenced by filing with Administrative Agent a certified copy of the
resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing conditions. No
Unrestricted Subsidiary may be designated as an Unrestricted Subsidiary
hereunder unless also designated as such under the Parent Financing Documents.
"Unrestricted Subsidiary Pledge Agreement" shall mean an
Unrestricted Subsidiary Pledge Agreement substantially in the form of Exhibit
D-2 among the Obligors, the Unrestricted Subsidiaries and Administrative Agent,
as the same may be amended in accordance with the terms thereof and hereof, or
such other agreements reasonably acceptable to Administrative Agent as shall be
necessary to comply with applicable Requirements of Law and effective to grant
to Administrative Agent a perfected first priority security interest in the
Pledged Collateral covered thereby.
"Unutilized Revolving Credit Commitment" shall mean, for any
Revolving Credit Lender, at any time, the excess of such Lender's Revolving
Credit Commitment at such time over the sum of (i) the aggregate outstanding
principal amount of Revolving Credit Loans made by such Lender, (ii) such
Lender's Revolving Credit Commitment Percentage of the aggregate amount of
Letter of Credit Liabilities at such time, and (iii) with respect to the Swing
Loan Lender only, the aggregate principal amount of Swing Loans then
outstanding.
"Unutilized Term Loan Commitments" shall mean, for any Term
Loan Lender, at any time, the excess of such Lender's Term Loan Commitments over
the aggregate principal amount of Term Loans made by such Lender.
"Wholly Owned Guarantor" shall mean any Wholly Owned
Subsidiary of Borrower which is a Guarantor.
"Wholly Owned Subsidiary" shall mean, with respect to any
Person, any corporation, partnership or other entity of which all of the Equity
Interests (other than, in the case of a corporation, directors' qualifying
shares or nominee shares required under applicable law) are directly or
indirectly owned or controlled by such Person or one or more Wholly Owned
Subsidiaries of such Person or by such Person and one or more Wholly Owned
Subsidiaries of such Person. Unless the context clearly requires otherwise, all
references to any Wholly Owned Subsidiary shall mean a Wholly Owned Subsidiary
of Borrower.
"Wholly Owned Unrestricted Subsidiary" shall mean any
Unrestricted Subsidiary of which all the Equity Interests (other than, in the
case of a corporation, directors' qualifying shares or nominee shares required
under applicable law) are directly or indirectly owned or controlled by Parent
or one or more Wholly Owned Unrestricted Subsidiaries or by Parent and one or
more Wholly Owned Unrestricted Subsidiaries.
"Withdrawal Liability" shall mean liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part 1 of Subtitle E of Title IV of ERISA.
"Working Capital" shall mean an amount determined for Borrower
and the Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP) equal to the sum of all current assets (other than cash)
less the sum of all current liabilities (other than the current portion of
long-term Indebtedness).
1.02. Accounting Terms and Determinations. Except as otherwise
provided in this Agreement, all computations and determinations as to accounting
or financial matters (including financial covenants) shall be made in accordance
with GAAP consistently applied for all applicable periods, and all accounting or
financial terms shall have the meanings ascribed to such terms by GAAP. All
financial statements to be delivered pursuant to this Agreement shall be
prepared in accordance with GAAP.
1.03. Classes and Types of Loans. Loans hereunder are
distinguished by "Class" and by "Type". The "Class" of a Loan (or of a
Commitment to make a Loan) refers to whether such Loan is a Revolving Credit
Loan, Swing Loan, Tranche A Term Loan, Tranche B Term Loan or Tranche C Term
Loan, each of which constitutes a Class. The "Type" of a Loan refers to whether
such Loan is an ABR Loan or a LIBOR Loan, each of which constitutes a Type.
Loans may be identified by both Class and Type.
1.04. Rules of Construction. (a) In this Agreement and each
other Credit Document, unless the context clearly requires otherwise (or such
other Credit Document clearly provides otherwise), references to (i) the plural
include the singular, the singular the plural and the part the whole; (ii)
Persons include their respective permitted successors and assigns or, in the
case of governmental Persons, Persons succeeding to the relevant functions of
such Persons; (iii) agreements (including this Agreement), promissory notes and
other contractual instruments include subsequent amendments, assignments, and
other modifications thereto, but only to the extent such amendments, assignments
or other modifications thereto are not prohibited by their terms or the terms of
any Credit Document; (iv) statutes and related regulations include any
amendments of same and any successor statutes and regulations; and (v) time
shall be a reference to Houston, Texas time. Where any provision herein refers
to action to be taken by any Person, or which such Person is prohibited from
taking, such provision shall be applicable whether such action is taken directly
or indirectly by such Person.
(b) In this Agreement and each other Credit Document, unless
the context clearly requires otherwise (or such other Credit Document clearly
provides otherwise), (i) "amend" shall mean "amend, restate, amend and restate,
supplement or modify"; and "amended," "amending," and "amendment" shall have
meanings correlative to the foregoing; (ii) in the computation of periods of
time from a specified date to a later specified date, "from" shall mean "from
and including"; "to" and "until" shall mean "to but excluding"; and "through"
shall mean "to and including"; (iii) "hereof," "herein" and "hereunder" (and
similar terms) in this Agreement or any other Credit Document refer to this
Agreement or such other Credit Document, as the case may be, as a whole and not
to any particular provision of this Agreement or such other Credit Document;
(iv) "including" (and similar terms) shall mean "including without limitation"
(and similarly for similar terms); (v) "or" has the inclusive meaning
represented by the phrase "and/or"; (vi) "satisfactory to" any Creditor shall
mean in form, scope and substance and on terms and conditions satisfactory to
such Creditor; (vii) references to "the date hereof" shall mean the date first
set forth above; and (viii) "asset" and "Property" shall have the same meaning
and effect and refer to all tangible and intangible assets and property, whether
real, personal or mixed and of every type and description.
(c) In this Agreement unless the context clearly requires
otherwise, any reference to (i) an Annex, Exhibit or Schedule is to an Annex,
Exhibit or Schedule, as the case may be, attached to this Agreement and
constituting a part hereof, and (ii) a Section or other subdivision is to a
Section or such other subdivision of this Agreement.
Section 2. Commitments, Letters of Credit, Fees, Register,
Prepayments and Replacement of Lenders.
2.01. Loans.
(a) Revolving Credit Loans. Each Revolving Credit Lender
severally agrees, on the terms and conditions of this Agreement, to make
revolving credit loans (the "Revolving Credit Loans") to Borrower in Dollars
during the period from and including the Closing Date to but not including the
Revolving Credit Commitment Termination Date in an aggregate principal amount at
any one time outstanding not exceeding the amount of the Revolving Credit
Commitment of such Lender as in effect from time to time; provided, however,
that in no event shall the sum of the aggregate principal amount of (without
duplication) all Revolving Credit Loans then outstanding, plus the aggregate
principal amount of Swing Loans then outstanding, plus the aggregate amount of
all Letter of Credit Liabilities at any time exceed the aggregate amount of the
Revolving Credit Commitments as in effect at such time. Subject to the terms and
conditions of this Agreement, during such period Borrower may borrow, repay and
reborrow the amount of the Revolving Credit Commitments by means of ABR Loans
and LIBOR Loans and may Convert Revolving Credit Loans of one Type into
Revolving Credit Loans of another Type (as provided in Section 2.09) or Continue
Revolving Credit Loans of one Type as Revolving Credit Loans of the same Type
(as provided in Section 2.09).
(b) Tranche A Term Loans. Each Tranche A Term Loan Lender
severally agrees, on the terms and conditions of this Agreement, to make a term
loan to Borrower in Dollars on the Closing Date and on the Deferred Drawdown
Date in an aggregate principal amount equal to the Tranche A Term Loan
Commitment of such Lender (of which not less than 20% shall be funded on the
Closing Date and the remainder shall be funded on the Deferred Drawdown Date),
such loan to be used to finance the Transactions and to pay related fees and
expenses. Subject to the terms and conditions of this Agreement, thereafter
Borrower may Convert Tranche A Term Loans of one Type into Tranche A Term Loans
of another Type (as provided in Section 2.09) or Continue Tranche A Term Loans
of one Type as Tranche A Term Loans of the same Type (as provided in Section
2.09). Each Tranche A Term Loan shall be made by a Tranche A Term Loan Lender
pro rata based on such Lender's Tranche A Term Loan Commitment Percentage. The
aggregate sum of the amount of the Tranche A Term Loans made on the Closing Date
and the Deferred Drawdown Date shall not exceed the Tranche A Term Loan
Commitments or, with respect to any Lender, its Tranche A Term Loan Commitment.
Tranche A Term Loans that are repaid or prepaid may not be
reborrowed.
(c) Tranche B Term Loans. Each Tranche B Term Loan Lender
severally agrees, on the terms and conditions of this Agreement, to make a term
loan to Borrower in Dollars on the Closing Date and on the Deferred Drawdown
Date in an aggregate principal amount equal to the Tranche B Term Loan
Commitment of such Lender (of which not less than 20% shall be funded on the
Closing Date and the remainder shall be funded on the Deferred Drawdown Date),
such loan to be used to finance the Transactions and to pay related fees and
expenses. Subject to the terms and conditions of this Agreement, thereafter
Borrower may Convert Tranche B Term Loans of one Type into Tranche B Term Loans
of another Type (as provided in Section 2.09) or Continue Tranche B Term Loans
of one Type as Tranche B Term Loans of the same Type (as provided in Section
2.09). Each Tranche B Term Loan shall be made by a Tranche B Term Loan Lender
pro rata based on such Lender's Tranche B Term Loan Commitment Percentage. The
aggregate amount of the Tranche B Term Loans made on the Closing Date and the
Deferred Drawdown Date shall not exceed the Tranche B Term Loan Commitments or,
with respect to any Lender, its Tranche B Term Loan Commitment.
Tranche B Term Loans that are repaid or prepaid may not be
reborrowed.
(d) Tranche C Term Loans. Each Tranche C Term Loan Lender
severally agrees, on the terms and conditions of this Agreement, to make a term
loan to Borrower in Dollars on the Closing Date and on the Deferred Drawdown
Date in an aggregate principal amount equal to the Tranche C Term Loan
Commitment of such Lender (of which not less than 20% shall be funded on the
Closing Date and the remainder shall be funded on the Deferred Drawdown Date),
such loan to be used to finance the Transactions and to pay related fees and
expenses. Subject to the terms and conditions of this Agreement, thereafter
Borrower may Convert Tranche C Term Loans of one Type into Tranche C Term Loans
of another Type (as provided in Section 2.09) or Continue Tranche C Term Loans
of one Type as Tranche C Term Loans of the same Type (as provided in Section
2.09). Each Tranche C Term Loan shall be made by a Tranche C Term Loan Lender
pro rata based on such Lender's Tranche C Term Loan Commitment Percentage. The
aggregate amount of the Tranche C Term Loans made on the Closing Date and the
Deferred Drawdown Date shall not exceed the Tranche C Term Loan Commitments or,
with respect to any Lender, its Tranche C Term Loan Commitment.
Tranche C Term Loans that are repaid or prepaid may not be
reborrowed.
(e) Limit on LIBOR Loans. No more than ten separate Interest
Periods in respect of LIBOR Loans of any Class may be outstanding at any one
time. No LIBOR Loans may be made at the Closing Date or the Deferred Drawdown
Date unless consented to by Arrangers in their sole discretion.
(f) Swing Loans. Subject to the terms and conditions of this
Agreement, upon request of Borrower, the Swing Loan Lender agrees to make one or
more swing loans to Borrower from time to time from and including the Closing
Date to but excluding the Swing Loan Maturity Date, up to but not exceeding the
amount of the Swing Loan Lender's Swing Loan Commitment as then in effect. (Such
swing loans referred to in this Section 2.01(f) now or hereafter made by the
Swing Loan Lender to Borrower from and including and after the Closing Date are
hereinafter collectively called the "Swing Loans.") Prior to the Swing Loan
Maturity Date, Borrower may borrow, repay and reborrow Swing Loans up to the
Swing Loan Commitment in accordance with the terms of this Agreement. The Swing
Loan Lender shall not make any Swing Loans on or after the Swing Loan Maturity
Date. Notwithstanding anything to the contrary contained in this Section 2.01(f)
or elsewhere in this Agreement, the Swing Loan Lender shall not be obligated,
pursuant to this Section 2.01(f) or otherwise, to make any Swing Loan to or for
the account of Borrower, and Borrower shall not be entitled to borrow, pursuant
to this Section 2.01(f), if, after giving full effect to the requested Swing
Loan, the aggregate outstanding amount of Revolving Credit Loans, plus the
aggregate outstanding amount of Swing Loans, plus the aggregate outstanding
Letter of Credit Liabilities would exceed the aggregate amount of the Revolving
Credit Commitments as in effect at such time. Notwithstanding anything herein or
elsewhere to the contrary, the Swing Loans will be made and maintained only as
ABR Loans. The Swing Loan Lender shall not make any Swing Loan after receiving a
written notice from Borrower or the Majority Revolving Credit Lenders stating
that a Default exists and is continuing until such time as the Swing Loan Lender
shall have received written notice of (i) rescission of all such notices from
the party or parties originally delivering such notice, (ii) the waiver of such
Default by the Majority Lenders, or (iii) Administrative Agent's good faith
determination that such Default has ceased to exist. Swing Loans shall be made
in minimum amounts of $500,000 and integral multiples of $500,000 above such
amount.
Upon the occurrence of a Default, each Revolving Credit Lender
shall be deemed to have purchased (and each Revolving Credit Lender hereby
irrevocably agrees to purchase on a pro rata basis (based upon each Revolving
Credit Lender's Revolving Credit Commitment)) an irrevocable participation in
all outstanding Swing Loans, together with all accrued interest thereon, without
any further action by or on behalf of the Swing Loan Lender, any other Lender,
Borrower or any other Person. Upon one Business Day's notice from the Swing Loan
Lender, each other Revolving Credit Lender shall deliver to the Swing Loan
Lender an amount equal to its respective participation in such Swing Loan (as
determined pursuant to the immediately preceding sentence) in cash. In order to
evidence such participation, each Revolving Credit Lender agrees to enter into a
participation agreement at the request of the Swing Loan Lender in form and
substance satisfactory to the Swing Loan Lender and the Revolving Credit Lender.
If any Revolving Credit Lender fails to make available to the Swing Loan Lender
the amount of such Revolving Credit Lender's participation as provided in this
paragraph, the Swing Loan Lender shall be entitled to recover such amount on
demand from such Revolving Credit Lender, together with interest thereon at the
Federal Funds Rate until such amount is paid in full in cash. In the event the
Swing Loan Lender receives a payment from Borrower or any other Obligor of any
amount in which the Revolving Credit Lenders have purchased participations as
provided in this paragraph, the Swing Loan Lender shall promptly distribute to
each Revolving Credit Lender its pro rata share of such payment. Anything
contained in this Agreement or otherwise to the contrary notwithstanding, (A)
each Revolving Credit Lender's obligation to purchase a participation in each
unpaid Swing Loan shall be absolute and unconditional and shall not be affected
by any circumstances, including, without limitation, (1) any setoff,
counterclaim, recoupment, defense or other right which such Revolving Credit
Lender may now or hereafter have against the Swing Loan Lender, Borrower or any
other Person for any reason whatsoever, (2) the occurrence or continuation of a
Default or an Event of Default, (3) any material adverse change in the condition
of Borrower or any Subsidiary, (4) any breach or default of this Agreement or
any of the Security Documents by any Person, or (5) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing,
and (B) the Swing Loan Lender shall not have any obligation to make any Swing
Loans if (1) Borrower fails for whatever reason to satisfy any of the conditions
precedent set forth in Section 7.02 or (2) any Revolving Credit Lender fails for
whatever reason to comply with its obligations under this Section 2.01(f).
(g) Increased Facility Amount. After the Closing Date,
Borrower may request that any of the Lenders (or to the extent that the existing
Lenders have not agreed within 20 days to provide the Increased Facility Amount
described herein, new Lenders ("New Lenders") acceptable to Arrangers) agree to
increase the amount of the Commitments to make extensions of credit hereunder by
up to $250 million (the "Increased Facility Amount"), which Increased Facility
Amount (x) shall be allocated among the Revolving Credit Facility and the Term
Loan Facilities or one or more new term loan facilities in amounts and with
maturities (including any extended maturity (in the sole discretion of
Arrangers) for such portion thereof allocated to the Revolving Credit Facility)
acceptable to Arrangers in their sole discretion and having terms and provisions
no more onerous than those contained in the Credit Documents, and (y) shall
require the consent of the Majority Lenders; provided, however, that at the time
of the effectiveness of such increase in the credit facilities hereunder, no
Default shall have occurred and be continuing. No Agent or Lender shall have any
obligation or liability whatsoever to any Company or any other Person with
respect to the approval of any Increased Facility Amount or for any refusal to
approve, negotiate or consider any such proposal or for any act or omission
related thereto. Subject to the approval of the Majority Lenders, Borrower and
Arrangers may make conforming and other necessary changes to the Credit
Documents in order to integrate the Increased Facility Amount into the Credit
Documents.
2.02. Borrowings. Borrower shall give Administrative Agent
notice of each borrowing hereunder as provided in Section 4.05. The form of such
notice of borrowing shall be substantially in the form of Exhibit H. Not later
than 12:00 noon Houston, Texas time on the date specified for each borrowing
hereunder, each Lender shall make available the amount of the Loan or Loans to
be made by it on such date to Administrative Agent, at an account specified by
Administrative Agent maintained at the Principal Office, in immediately
available funds, for the account of Borrower. Each borrowing of Revolving Credit
Loans shall be made by each Revolving Credit Lender pro rata based on such
Lender's Revolving Credit Commitment Percentage. The amounts so received by
Administrative Agent shall, subject to the terms and conditions of this
Agreement, be made available to Borrower by depositing the same, in immediately
available funds, in an account of Borrower maintained with Administrative Agent
at the Principal Office designated by Borrower.
2.03. Letters of Credit. Subject to the terms and conditions
hereof, the Revolving Credit Commitments may be utilized, upon the request of
Borrower, in addition to the Revolving Credit Loans provided for by Section
2.01(a), for standby and commercial documentary letters of credit (herein
collectively called "Letters of Credit") issued by the Issuing Lender for the
account of Borrower or any Subsidiary which is an Obligor (provided, that
Borrower shall be a co-applicant (and jointly and severally liable) with respect
to each Letter of Credit issued for the account of any such Subsidiary);
provided, however, that in no event shall (i) the aggregate amount of all Letter
of Credit Liabilities, plus the aggregate principal amount of the Revolving
Credit Loans then outstanding, plus the aggregate principal amount of Swing
Loans then outstanding exceed at any time the Revolving Credit Commitments as in
effect at such time, (ii) the sum of the aggregate principal amount of Revolving
Credit Loans then outstanding made by any Revolving Credit Lender, plus such
Lender's pro rata share (based on the Revolving Credit Commitments) of the
aggregate principal amount of Swing Loans then outstanding), plus such Lender's
pro rata share (based on the Revolving Credit Commitments) of the aggregate
amount of all Letter of Credit Liabilities exceed such Lender's Revolving Credit
Commitment as in effect at such time, (iii) the outstanding aggregate amount of
all Letter of Credit Liabilities exceed $10.0 million, (iv) the face amount of
any Letter of Credit be less than $50,000, (v) the expiration date of any Letter
of Credit extend beyond the earlier of (x) the fifth Business Day preceding the
Revolving Credit Commitment Termination Date and (y) the date twelve months
following the date of such issuance for standby Letters of Credit or 180 days
after the date of such issuance for commercial documentary Letters of Credit,
unless the Majority Revolving Credit Lenders have approved such expiry date in
writing (but never beyond the fifth Business Day prior to the Revolving Credit
Commitment Termination Date); provided, however, that any standby Letter of
Credit may be automatically extendible for periods of up to one year (but never
beyond the fifth Business Day preceding the Revolving Credit Commitment
Termination Date) so long as such Letter of Credit provides that the Issuing
Lender retains an option satisfactory to the Issuing Lender to terminate such
Letter of Credit prior to each extension date, unless all of the Revolving
Credit Lenders have approved such expiry date in writing, or (vi) the Issuing
Lender issue any Letter of Credit after it has received notice from Borrower or
the Majority Revolving Credit Lenders stating that a Default exists until such
time as the Issuing Lender shall have received written notice of (x) rescission
of such notice from the Majority Revolving Credit Lenders, (y) waiver of such
Default in accordance with this Agreement or (z) Administrative Agent's good
faith determination that such Default has ceased to exist. The following
additional provisions shall apply to Letters of Credit:
(a) Borrower shall give Administrative Agent at least three
Business Days' irrevocable prior notice (effective upon receipt)
specifying the date (which shall be no later than thirty days preceding
the Revolving Credit Termination Date) each Letter of Credit is to be
issued and describing in reasonable detail the proposed terms of such
Letter of Credit (including the beneficiary thereof) (including whether
such Letter of Credit is to be a commercial Letter of Credit or a
standby Letter of Credit). Upon receipt of any such notice,
Administrative Agent shall advise the Issuing Lender of the contents
thereof. Each Lender hereby authorizes the Issuing Lender to issue, and
perform its obligations under, Letters of Credit. Letters of Credit
shall be issued in accordance with the customary procedures of the
Issuing Lender, which may include an application for Letters of Credit.
The Issuing Lender may refuse to issue any Letter of Credit the
contents of which are not reasonably satisfactory to it. If there is
any conflict between the procedures required by the Issuing Lender and
this Agreement, this Agreement shall govern.
(b) On each day during the period commencing with the issuance
by the Issuing Lender of any Letter of Credit and until such Letter of
Credit shall have expired or been terminated, the Revolving Credit
Commitment of each Revolving Credit Lender shall be deemed to be
utilized for all purposes hereof in an amount equal to such Lender's
Revolving Credit Commitment Percentage of the then undrawn face amount
of such Letter of Credit. Each Revolving Credit Lender (other than the
Issuing Lender) agrees that, upon the issuance of any Letter of Credit
hereunder, it shall automatically acquire a participation in the
Issuing Lender's liability under such Letter of Credit in an amount
equal to such Lender's Revolving Credit Commitment Percentage of such
liability, and each Revolving Credit Lender (other than the Issuing
Lender) thereby shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and shall be
unconditionally obligated to the Issuing Lender to pay and discharge
when due, its Revolving Credit Commitment Percentage of the Issuing
Lender's liability under such Letter of Credit. The Issuing Lender
shall be deemed to hold a Letter of Credit Liability in an amount equal
to its retained interest in the related Letter of Credit after giving
effect to such acquisition by the Revolving Credit Lenders other than
the Issuing Lender of their participation interests.
(c) Upon the making of any payment to the beneficiary of any
Letter of Credit, the Issuing Lender shall promptly notify Borrower
(through Administrative Agent) of the amount paid by the Issuing Lender
and the date on which payment was made to such beneficiary. Borrower
hereby unconditionally agrees to pay and reimburse the Issuing Lender
for the amount of payment under such Letter of Credit, together with
interest thereon at the Alternate Base Rate plus the Applicable Margin
applicable to Revolving Credit Loans from the date payment was made to
such beneficiary to the date on which payment is due, not later than
the next Business Day after the date on which Borrower receives such
notice from the Issuing Lender (or the second Business Day thereafter
if such notice is received on a date that is not a Business Day or
after 11:00 a.m. Houston, Texas time on a Business Day). Any such
payment due from Borrower and not paid on the required date shall bear
interest at rates specified in Section 3.02(b).
(d) Forthwith upon its receipt of a notice referred to in
clause (c) of this Section 2.03, Borrower shall advise the Issuing
Lender whether or not Borrower intends to borrow hereunder to finance
its obligation to reimburse the Issuing Lender for the amount of the
related demand for payment and, if it does, submit a notice of such
borrowing as provided in Section 4.05. In the event that Borrower fails
to so advise Administrative Agent, or if Borrower fails to reimburse
the Issuing Lender for a demand for payment under a Letter of Credit by
the next Business Day after the date of such notice, Administrative
Agent shall give each Revolving Credit Lender prompt notice of the
amount of the demand for payment, specifying such Lender's Revolving
Credit Commitment Percentage of the amount of the related demand for
payment.
(e) Each Revolving Credit Lender (other than the Issuing
Lender) shall pay to Administrative Agent for account of the Issuing
Lender at the Principal Office in Dollars and in immediately available
funds, the amount of such Lender's Revolving Credit Commitment
Percentage of any payment under a Letter of Credit upon not less than
one Business Day's notice by the Issuing Lender (through Administrative
Agent) to such Revolving Credit Lender requesting such payment and
specifying such amount. Each such Revolving Credit Lender's obligation
to make such payments to Administrative Agent for account of the
Issuing Lender under this clause (e), and the Issuing Lender's right to
receive the same, shall be absolute and unconditional and shall not be
affected by any circumstance whatsoever, including (i) the failure of
any other Revolving Credit Lender to make its payment under this clause
(e), (ii) the financial condition of Borrower or the existence of any
Default or (iii) the termination of the Commitments. Each such payment
to the Issuing Lender shall be made without any offset, abatement,
withholding or reduction whatsoever.
(f) Upon the making of each payment by a Revolving Credit
Lender to the Issuing Lender pursuant to clause (e) above in respect of
any Letter of Credit, such Lender shall, automatically and without any
further action on the part of Administrative Agent, the Issuing Lender
or such Lender, acquire (i) a participation in an amount equal to such
payment in the Reimbursement Obligation owing to the Issuing Lender by
Borrower hereunder and under the Letter of Credit Documents relating to
such Letter of Credit and (ii) a participation in a percentage equal to
such Lender's Revolving Credit Commitment Percentage in any interest or
other amounts payable by Borrower hereunder and under such Letter of
Credit Documents in respect of such Reimbursement Obligation. Upon
receipt by the Issuing Lender from or for the account of Borrower of
any payment in respect of any Reimbursement Obligation or any such
interest or other amounts (including by way of setoff or application of
proceeds of any collateral security) the Issuing Lender shall promptly
pay to Administrative Agent for account of each Revolving Credit Lender
which has satisfied its obligations under clause (e) above, such
Revolving Credit Lender's Revolving Credit Commitment Percentage of
such payment, each such payment by the Issuing Lender to be made in the
same money and funds in which received by the Issuing Lender. In the
event any payment received by the Issuing Lender and so paid to the
Revolving Credit Lenders hereunder is rescinded or must otherwise be
returned by the Issuing Lender, each Revolving Credit Lender shall,
upon the request of the Issuing Lender (through Administrative Agent),
repay to the Issuing Lender (through Administrative Agent) the amount
of such payment paid to such Lender, with interest at the rate
specified in clause (i) of this Section 2.03.
(g) Borrower shall pay to Administrative Agent for the account
of the Issuing Lender in respect of each Letter of Credit a letter of
credit commission in an amount (not less than $500) equal to (x) the
rate per annum equal to the Applicable Margin for Revolving Credit
Loans that are LIBOR Loans in effect from time to time, multiplied by
(y) the daily average undrawn face amount of such Letter of Credit for
the period from and including the date of issuance of such Letter of
Credit (i) in the case of a Letter of Credit which expires in
accordance with its terms, to and including such expiration date and
(ii) in the case of a Letter of Credit which is drawn in full or is
otherwise terminated other than on the stated expiration date of such
Letter of Credit, to but excluding the date such Letter of Credit is
drawn in full or is terminated, such fee to be non-refundable and to be
paid in arrears quarterly, on each Quarterly Date, and on the earlier
of the Revolving Credit Commitment Termination Date or the date of the
termination of the Revolving Credit Commitments or the date of such
termination, expiration or the Business Day subsequent to notice of a
drawing. The Issuing Lender shall pay to Administrative Agent for
account of each Revolving Credit Lender (other than the Issuing
Lender), from time to time at reasonable intervals (but in any event at
least quarterly), but only to the extent actually received from
Borrower, an amount equal to such Lender's Revolving Credit Commitment
Percentage of all letter of credit commissions referred to in the first
sentence of this clause (g). In addition, Borrower shall pay to
Administrative Agent for account of the Issuing Lender only in respect
of each Letter of Credit a letter of credit issuance fee in an amount
equal to 0.125% per annum multiplied by the original face amount from
the issue date through the expiry date of such Letter of Credit (but in
no event less than $500 per Letter of Credit), such amount to be
payable quarterly in arrears on each Quarterly Date, plus all charges,
costs and expenses in the amounts customarily charged by the Issuing
Lender from time to time in like circumstances with respect to the
issuance, amendment or transfer of each Letter of Credit and drawings
and other transactions relating thereto.
(h) Promptly following the end of each calendar month, the
Issuing Lender shall deliver (through Administrative Agent) to each
Revolving Credit Lender and Borrower a notice describing the aggregate
amount of all Letters of Credit outstanding at the end of such month.
Upon the request of any Revolving Credit Lender from time to time, the
Issuing Lender shall deliver any other information reasonably requested
by such Lender with respect to each Letter of Credit then outstanding.
(i) To the extent that any Revolving Credit Lender fails to
pay an amount required to be paid pursuant to clause (e) or (f) of this
Section 2.03 on the due date therefor, such Lender shall pay interest
to the Issuing Lender (through Administrative Agent) on such amount
from and including such due date to but excluding the date such payment
is made (i) during the period from and including such due date to but
excluding the date three Business Days thereafter, at a rate per annum
equal to the Federal Funds Rate (as in effect from time to time) and
(ii) thereafter, at a rate per annum equal to the post-default rate (as
in effect from time to time) pursuant to Section 3.02(b).
(j) The issuance by the Issuing Lender of any modification or
supplement to any Letter of Credit hereunder that would extend the
expiry date or increase the face amount thereof shall be subject to the
same conditions applicable under this Section 2.03 to the issuance of
new Letters of Credit, and no such modification or supplement shall be
issued hereunder unless either (x) the respective Letter of Credit
affected thereby would have complied with such conditions had it
originally been issued hereunder in such modified or supplemented form
or (y) each Revolving Credit Lender shall have consented thereto.
(k) Notwithstanding the foregoing, the Issuing Lender shall
not be under any obligation to issue any Letter of Credit if at the
time of such issuance, 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 shall prohibit the issuance of letters of
credit generally or such Letter of Credit in particular or shall impose
upon such 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) not in effect on the date hereof.
At any time that the Issuing Lender shall not be under any obligation
to issue Letters of Credit pursuant to this paragraph (k), the Issuing
Lender may be replaced by Borrower with another Lender reasonably
acceptable to Administrative Agent upon notice to the Issuing Lender
and Administrative Agent. Upon any such replacement, Administrative
Agent shall notify the Lenders of any such replacement of the Issuing
Lender and the replacement Issuing Lender shall agree to be bound by
the applicable provisions of this Agreement. At the time any such
replacement shall become effective, Borrower shall pay all unpaid fees
accrued for the account of the replaced Issuing Lender pursuant to
Section 2.03(g). From and after the effective date of any such
replacement, (i) the successor Issuing Lender shall have all the rights
and obligations of the Issuing Lender under this Agreement with respect
to Letters of Credit to be issued thereafter and (ii) references herein
to the term "Issuing Lender" shall be deemed to refer to such successor
or to any previous Issuing Lender, or to such successor and all
previous Issuing Lenders, as the context shall require. After the
replacement of an Issuing Lender hereunder, the replaced Issuing Lender
shall remain a party hereto and shall continue to have all the rights
and obligations of an Issuing Lender under this Agreement with respect
to Letters of Credit issued by it prior to such replacement, but shall
not be required to issue additional Letters of Credit.
The obligations of Borrower under this Agreement and any Letter of Credit
Document to reimburse the Issuing Lender for a drawing under a Letter of Credit,
and to repay any drawing under a Letter of Credit converted into Revolving
Credit Loans, shall be unconditional and irrevocable, and shall be paid strictly
in accordance with the terms of this Agreement and each such other Letter of
Credit Document under all circumstances, including the following: (i) any lack
of validity or enforceability of this Agreement or any Letter of Credit
Document; (ii) the existence of any claim, setoff, defense or other right that
Borrower may have at any time against any beneficiary or any transferee of any
Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the Issuing Lender or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by the
Letter of Credit Documents or any unrelated transaction; (iii) any draft,
demand, certificate or 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; or any loss or
delay in the transmission or otherwise of any document required in order to make
a drawing under any Letter of Credit; or any defense based upon the failure of
any drawing under a Letter of Credit to conform to the terms of the Letter of
Credit or any non-application or misapplication by the beneficiary of the
proceeds of such drawing; or (iv) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, Borrower or a Guarantor; provided, however, that Borrower shall
not be obligated to reimburse the Issuing Lender for any wrongful payment
determined by a court of competent jurisdiction to have been made by the Issuing
Lender as a result of acts or omissions constituting willful misconduct or gross
negligence on the part of the Issuing Lender. To the extent that any provision
of any Letter of Credit Document is inconsistent with the provisions of this
Section 2.03, the provisions of this Section 2.03 shall control.
2.04. Termination and Reductions of Commitments. (a) (i) The
Commitments shall be automatically and permanently terminated on September 15,
1998 if the Closing Date does not occur by such date. The aggregate amount of
the Revolving Credit Commitments shall be automatically and permanently reduced
to zero on the Revolving Credit Commitment Termination Date. The aggregate
amount of Revolving Credit Commitments shall be permanently reduced on the date
any required prepayments described in Section 2.10(a) are required to be made in
the amount specified in Section 2.10(b)(ii).
(ii) The aggregate amount of the Revolving Credit Commitments
shall be automatically and permanently reduced on each date set forth in the
table below (or if such date shall not be a Business Day, on the Business Day
immediately preceding such date) in an amount equal to the lesser of (x) that
dollar amount of the aggregate Revolving Credit Commitments set forth in the
column entitled "Reduction Amount", or (y) that dollar amount of the Revolving
Credit Commitments such that immediately after giving effect thereto the
Revolving Credit Commitments would be not more than the amount of the Revolving
Credit Commitments set forth below in the column entitled "Remaining Amount":
===============================================================================
Date Reduction Amount Remaining Amount
- -------------------------------------------------------------------------------
March 31, 2001 $3,750,000 $146,250,000
- -------------------------------------------------------------------------------
June 30, 2001 $3,750,000 $142,500,000
- -------------------------------------------------------------------------------
September 30, 2001 $3,750,000 $138,750,000
- -------------------------------------------------------------------------------
December 31, 2001 $3,750,000 $135,000,000
- -------------------------------------------------------------------------------
March 31, 2002 $3,750,000 $131,250,000
- -------------------------------------------------------------------------------
June 30, 2002 $3,750,000 $127,500,000
- -------------------------------------------------------------------------------
September 30, 2002 $3,750,000 $123,750,000
- -------------------------------------------------------------------------------
December 31, 2002 $3,750,000 $120,000,000
- -------------------------------------------------------------------------------
March 31, 2003 $5,625,000 $114,375,000
- -------------------------------------------------------------------------------
June 30, 2003 $5,625,000 $108,750,000
- -------------------------------------------------------------------------------
September 30, 2003 $5,625,000 $103,125,000
- -------------------------------------------------------------------------------
December 31, 2003 $5,625,000 $97,500,000
- -------------------------------------------------------------------------------
March 31, 2004 $5,625,000 $91,875,000
- -------------------------------------------------------------------------------
June 30, 2004 $5,625,000 $86,250,000
- -------------------------------------------------------------------------------
September 30, 2004 $5,625,000 $80,625,000
- -------------------------------------------------------------------------------
December 31, 2004 $5,625,000 $75,000,000
- -------------------------------------------------------------------------------
March 31, 2005 $7,500,000 $67,500,000
- -------------------------------------------------------------------------------
June 30, 2005 $7,500,000 $60,000,000
- -------------------------------------------------------------------------------
September 30, 2005 $7,500,000 $52,500,000
- -------------------------------------------------------------------------------
December 31, 2005 $7,500,000 $45,000,000
- -------------------------------------------------------------------------------
March 31, 2006 $11,250,000 $33,750,000
- -------------------------------------------------------------------------------
June 30, 2006 $11,250,000 $22,500,000
- -------------------------------------------------------------------------------
September 30, 2006 $11,250,000 $11,250,000
- -------------------------------------------------------------------------------
December 31, 2006 $11,250,000 0
===============================================================================
Each such reduction shall apply pro rata to each Revolving Credit Lender's
Revolving Credit Commitment. Concurrently with any such reduction, Borrower
shall comply with Section 2.10(c).
(iii) The aggregate amount of the Term Loan Commitments shall be
automatically and permanently reduced (x) immediately after the making of the
Term Loans on the Closing Date, in an amount equal to the amount of Term Loans
made on the Closing Date, and (y) immediately after the making of the Term Loans
on the Deferred Drawdown Date, to zero.
(b) Borrower shall have the right at any time or from time to
time (without premium or penalty except breakage costs (if any)) (i) so long as
no Revolving Credit Loans or Letter of Credit Liabilities will be outstanding as
of the date specified for termination, to terminate the Revolving Credit
Commitments, and (ii) to reduce the aggregate amount of the Unutilized Revolving
Credit Commitments of all the Revolving Credit Lenders; provided, however, that
(x) Borrower shall give notice of each such termination or reduction as provided
in Section 4.05, and (y) each partial reduction shall be in an aggregate amount
at least equal to $5.0 million (or a larger multiple of $1.0 million) or, if
less, the remaining Revolving Credit Commitments.
(c) The Commitments once terminated or reduced may not be
reinstated.
2.05. Fees. (a) Borrower shall pay to Administrative Agent for
the account of each Revolving Credit Lender a commitment fee on the daily
average amount of such Lender's Unutilized Revolving Credit Commitment, for the
period from and including the date of execution and delivery hereof to but not
including the earlier of the date such Revolving Credit Commitment is terminated
and the Revolving Credit Commitment Termination Date, at a rate per annum equal
to the Applicable Revolving Credit Fee Percentage. Borrower shall pay to
Administrative Agent for the account of each Term Loan Lender a commitment fee
on the amount of such Lender's Unutilized Term Loan Commitments for the period
from and including the date of execution and delivery hereof to but not
including the earlier of the Deferred Drawdown Date and the date of termination
or expiration of the Commitments at a rate per annum equal to 0.50%. Any accrued
commitment fee under this Section 2.05(a) shall be payable in arrears (x) with
respect to the Revolving Credit Commitments, on each Quarterly Date and on the
earlier of the date the Revolving Credit Commitments are terminated and the
Revolving Credit Commitment Termination Date, and (y) with respect to the Term
Loan Commitments, on the earlier of the Deferred Drawdown Date and the
termination or expiration of the Term Loan Commitments.
(b) Borrower shall pay to Administrative Agent for its own
account a nonrefundable administrative fee pursuant to the terms of the Fee
Letter.
2.06. Lending Offices. The Loans of each Type made by each
Lender shall be made and maintained at such Lender's Applicable Lending Office
for Loans of such Type.
2.07. Several Obligations of Lenders. The failure of any
Lender to make any Loan to be made by it on the date specified therefor shall
not relieve any other Lender of its obligation to make its Loan on such date,
but neither any Lender nor Administrative Agent shall be responsible for the
failure of any other Lender to make a Loan to be made by such other Lender, and
no Lender shall have any obligation to Administrative Agent or any other Lender
for the failure by such Lender to make any Loan required to be made by such
Lender.
2.08. Notes; Register. (a) (i) At the request of any Lender,
the Revolving Credit Loans made by such Revolving Credit Lender shall be
evidenced by one or more promissory notes of Borrower, substantially in the form
of Exhibit A-1, dated the Closing Date, payable to such Lender and otherwise
duly completed.
(ii) At the request of any Lender, the Tranche A Term Loans
made or to be made by such Tranche A Term Loan Lender shall be evidenced by one
or more promissory notes of Borrower, substantially in the form of Exhibit A-2,
dated the Closing Date, payable to such Lender and otherwise duly completed.
(iii) At the request of any Lender, the Tranche B Term Loans
made or to be made by such Tranche B Term Loan Lender shall be evidenced by one
or more promissory notes of Borrower, substantially in the form of Exhibit A-3,
dated the Closing Date, payable to such Lender and otherwise duly completed.
(iv) At the request of any Lender, the Tranche C Term Loans
made or to be made by such Tranche C Term Loan Lender shall be evidenced by one
or more promissory notes of Borrower, substantially in the form of Exhibit A-4,
dated the Closing Date, payable to such Lender and otherwise duly completed.
(v) At the request of the Swing Loan Lender, the Swing Loans
made by Administrative Agent shall be evidenced by one or more promissory notes
of Borrower, substantially in the form of Exhibit A-5, dated the Closing Date,
payable to the Swing Loan Lender and otherwise duly completed.
(b) The date, amount, Type, interest rate and duration of
Interest Period (if applicable) of each Loan of each Class made by each Lender
to Borrower, and each payment made on account of the principal thereof, shall be
recorded by such Lender on its books and, prior to any transfer of any Note
evidencing the Loans of such Class held by it, endorsed by such Lender on the
schedule attached to such Note or any continuation thereof; provided, however,
that the failure of such Lender to make any such recordation or endorsement
shall not affect the obligations of Borrower to make a payment when due of any
amount owing hereunder or under such Note.
(c) Borrower hereby designates Administrative Agent to serve
as its agent, solely for purposes of this Section 2.08, to maintain a register
(the "Register") on which it will record the name and address of each Lender,
the Commitment from time to time of each of the Lenders, the principal amount of
the Loans made by each of the Lenders and each repayment in respect of the
principal amount of the Loans of each Lender. Failure to make any such
recordation or any error in such recordation shall not affect Borrower's
obligations in respect of such Loans. The entries in the Register shall be
conclusive, in the absence of manifest error, and Borrower, Administrative Agent
and the Lenders shall treat each Person whose name is recorded in the Register
as the owner of a Loan or other obligation hereunder as the owner thereof for
all purposes of this Agreement and the other Credit Documents, notwithstanding
any notice to the contrary. The Register shall be available for inspection by
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
2.09. Optional Prepayments and Conversions or Continuations of
Loans. Subject to Section 4.04, Borrower shall have the right to prepay Loans,
or to Convert Loans of one Type into Loans of another Type or to Continue Loans
of one Type as Loans of the same Type, at any time or from time to time to be
applied as specified by Borrower; provided, however, that: (a) Borrower shall
give Administrative Agent notice of each such prepayment, Conversion or
Continuation as provided in Section 4.05 (and, upon the date specified in any
such notice of prepayment, the amount to be prepaid shall become due and payable
hereunder); (b) if LIBOR Loans are prepaid or Converted other than on the last
day of an Interest Period for such Loans, Borrower shall at such time pay all
expenses and costs required by Section 5.05; and (c) prepayments of the Term
Loans pursuant to this Section 2.09 shall be applied pro rata among the Term
Loan Tranches based upon the remaining unpaid amounts thereof and, as to each
such Term Loan Tranche, the amount to be applied thereto shall be applied pro
rata among the remaining Amortization Payments based upon the remaining unpaid
amounts thereof. Each notice of Conversion or Continuation shall be
substantially in the form of Exhibit H.
Notwithstanding the foregoing, any Tranche B Term Loan Lender
or Tranche C Term Loan Lender may, with respect to any voluntary prepayment, to
the extent that Tranche A Term Loans are outstanding (after giving effect to the
application of such voluntary prepayment to the Tranche A Term Loans), elect not
to have all or any part of any voluntary prepayments applied to such Lender's
Tranche B Term Loans or Tranche C Term Loans, as the case may be, in which case
the aggregate amount of such prepayment so declined shall be applied to the
remaining Amortization Payments with respect to the Tranche A Term Loans pro
rata (to the extent that the aggregate principal amount of the Tranche A Term
Loans after giving effect to such optional prepayment is less than the aggregate
amount so declined by the holders of the Tranche B Term Loans and Tranche C Term
Loans, such amount of the Tranche A Term Loans shall be allocated pro rata to
such declining holders based on the aggregate amount declined). If no Tranche A
Term Loans are outstanding, such election to decline prepayments shall not be
available.
Notwithstanding the foregoing, and without limiting the rights
and remedies of the Lenders under Section 10, in the event that any Event of
Default shall have occurred and be continuing, Administrative Agent may (and at
the request of the Majority Lenders shall) suspend the right of Borrower to
Convert any Loan into a LIBOR Loan, or to Continue any Loan as a LIBOR Loan, in
which event all Loans shall be Converted (on the last day(s) of the respective
Interest Periods therefor) or Continued, as the case may be, as ABR Loans.
2.10. Mandatory Prepayments. (a) Borrower shall prepay the
Term Loans as follows (each such prepayment to be effected in each case in the
manner, order and to the extent specified in subsection (b) below of this
Section 2.10):
(i) Casualty Events. Within one Business Day after Parent or
any Subsidiary receives any Net Available Proceeds from any Casualty
Event, in an aggregate principal amount equal to 100% of such Net
Available Proceeds; provided, however, that
(w) if no Event of Default then exists or would arise
therefrom, the Net Available Proceeds thereof shall not be
required to be so applied on such date to the extent that
Borrower has delivered an Officers' Certificate to
Administrative Agent on or prior to such date stating that
such proceeds shall be used to fund the substitution of
Property used or usable in the business of Borrower and the
Subsidiaries or repair, replace or restore the Property in
respect of which such Casualty Event has occurred, in each
case within one year following the date of the receipt of such
Net Available Proceeds,
(x) all such Net Available Proceeds in excess of
$50,000 individually or $500,000 in the aggregate shall be
held in the Collateral Account and released therefrom only in
accordance with the terms of the Security Agreement, and
(y) if all or any portion of such Net Available
Proceeds not required to be applied to the prepayment of Term
Loans pursuant to the preceding proviso (w) is not so used
within one year after the date of the receipt of such Net
Available Proceeds, such remaining portion shall be applied on
the last day of such period as specified in Section 2.10(b).
(ii) Equity Issuance. Upon any Equity Issuance after the
Closing Date, in an aggregate principal amount equal to 50% of the Net
Available Proceeds of such Equity Issuance.
(iii) Debt Issuance. Upon any Debt Issuance after the Closing
Date, in an aggregate principal amount equal to 100% of the Net
Available Proceeds of such Debt Issuance.
(iv) Disposition Events. Within one Business Day after
receipt by any Company of any Net Available Proceeds from any
Disposition Event (other than any Excluded Disposition Proceeds), in an
aggregate principal amount equal to 100% of the Net Available Proceeds
from such Disposition Event; provided, however, that
(x) the Net Available Proceeds from any Disposition
contemplated by clause (iii) of the definition thereof and the
Net Available Proceeds of any Disposition Event permitted by
Section 9.06(g), (n), (o) or (q) shall not be required to be
applied as provided herein on such date if (1) no Event of
Default then exists or would arise therefrom, and (2) Borrower
delivers an Officers' Certificate to Administrative Agent on
or prior to such date stating that such Net Available Proceeds
shall be reinvested in capital assets of Borrower or any
Subsidiary (or to the extent any such Net Available Proceeds
are from a Disposition pursuant to clause (iii) of the
definition thereof with respect to any Unrestricted
Subsidiary, reinvested in one or more Unrestricted
Subsidiaries) in each case within one year following the date
of such Disposition Event (which certificate shall set forth
the estimates of the proceeds to be so expended),
(y) all such Net Available Proceeds in excess of
$50,000 and $500,000 in the aggregate shall be held in the
Collateral Account and released therefrom only in accordance
with the terms of the Security Agreement, and
(z) if all or any portion of such Net Available
Proceeds which are permitted to be applied to reinvestment
pursuant to the terms of this Section 2.10(a)(iv) is not so
used within such one year period, such remaining portion shall
be applied on the last day of such period (or such earlier
date as Borrower determines not to reinvest any portion
thereof) as specified in Section 2.10(b) (it being understood
that the foregoing shall in no way affect the obligation of
any Company to obtain the consent of the Majority Lenders if
required pursuant to this Agreement to effect any
Disposition).
Notwithstanding the foregoing, Borrower need not apply any Net
Available Proceeds of any Disposition effected pursuant to Section
9.06(q) in accordance with this Section 2.10(a)(iv) if the related
Acquisition that was the source of the assets being disposed of was
effected solely with the proceeds of Revolving Credit Loans, that
portion of Equity Issuances not required to be applied to the
prepayment of the Loans and that portion of Excess Cash Flow not
required to be applied to the prepayment of the Loans; provided,
however, that (1) Borrower shall have provided to Arrangers and the
Lenders not fewer than five Business Days prior to such Disposition an
Officers' Certificate certifying as to the foregoing, and (2) Borrower
shall have applied the Net Available Proceeds thereof to the repayment
of the Revolving Credit Loans within one Business Day of the receipt
thereof (it being understood that no reduction of the Revolving Credit
Commitments need be accompanied with such prepayment).
(v) Excess Cash Flow. Not later than 95 days after the end
of each fiscal year of Borrower commencing with the fiscal year ended
December 31, 1998, in an aggregate principal amount equal to (A) 75% of
Excess Cash Flow for such fiscal year when the Total Leverage Ratio at
the end of such fiscal year is greater than or equal to 8.0:1.0 (as
evidenced in an Officers' Certificate delivered to Arrangers), and (B)
50% of Excess Cash Flow for such fiscal year when the Total Leverage
Ratio at the end of such fiscal year is less than 8.0:1.0 (as evidenced
in an Officers' Certificate delivered to Arrangers).
(vi) Other Required Prepayments. If the terms of any
agreement, instrument or indenture pursuant to which any Indebtedness
pari passu with or junior in right of payment to the Loans is
outstanding (or pursuant to which such Indebtedness is guaranteed)
require prepayment of such Indebtedness out of the proceeds of any
Disposition or otherwise unless such proceeds are used to prepay other
Indebtedness, then, to the extent not otherwise required by this
Section 2.10(a), the Loans shall be repaid in an amount not less than
the minimum amount that would be required to be prepaid not later than
the latest time as and upon such terms so that such other Indebtedness
will not be required to be prepaid pursuant to the terms of the
agreement, indenture or instrument or guarantee governing such other
Indebtedness.
(b) Application. The amount of any required prepayments
described in Section 2.10(a) shall be applied as follows:
(i) first, the amount of the required prepayment shall be
applied to the reduction of Amortization Payments on the Term Loans
required by Section 3.01(b) pro rata among the Term Loan Tranches based
upon the remaining unpaid amounts thereof and, as to each such Term
Loan Tranche, the amount to be applied thereto shall be applied pro
rata to the remaining Amortization Payments of such Term Loan Tranche
based on the remaining unpaid amounts thereof. Notwithstanding the
foregoing, (x) any holder of Tranche B Term Loans or Tranche C Term
Loans may, with respect to any mandatory prepayment, to the extent that
Tranche A Term Loans are outstanding (after giving effect to such
required prepayment to the Tranche A Term Loans), elect not to have all
or any amount of any such required prepayments applied to such holder's
Tranche B Term Loans or Tranche C Term Loans, as the case may be, in
which case the aggregate amount so declined shall be applied to the
remaining Amortization Payments in respect of the Tranche A Term Loans
pro rata (to the extent that the aggregate principal amount of the
Tranche A Term Loans after giving effect to such mandatory prepayment
is less than the aggregate amount so declined by the holders of the
Tranche B Term Loans and Tranche C Term Loans, such amount of the
Tranche A Term Loans shall be allocated pro rata to such declining
holders based on the aggregate amount declined), and (y) if no Tranche
A Term Loans are outstanding (after giving effect to such required
prepayment), such election to decline prepayments shall not be
available; and
(ii) second, after such time as no Term Loans remain
outstanding, Revolving Credit Commitments shall be permanently reduced
(at the same time that the prepayment of the Term Loans would have been
made and assuming an unlimited amount thereof then outstanding) pro
rata in an amount equal to the remaining amount of any such required
prepayment that would have been applied to the Term Loans (assuming an
unlimited amount thereof then outstanding) and to the extent that,
after giving effect to such reduction, the aggregate principal amount
of Revolving Credit Loans, plus the aggregate principal amount of Swing
Loans, plus the aggregate amount of all Letter of Credit Liabilities
would exceed the Revolving Credit Commitments, Borrower shall, first,
prepay outstanding Revolving Credit Loans, second, prepay outstanding
Swing Loans and, third, provide cover for Letter of Credit Liabilities
as specified in Section 2.10(d), in an aggregate amount equal to such
excess. Any application to the Revolving Credit Commitments shall
reduce the required scheduled reduction amounts under Section
2.04(a)(ii) pro rata.
Notwithstanding the foregoing, if the amount of any prepayment
of Loans required under this Section 2.10 shall be in excess of the amount of
the ABR Loans at the time outstanding, only the portion of the amount of such
prepayment as is equal to the amount of such outstanding ABR Loans shall be
immediately prepaid and, at the election of Borrower, the balance of such
required prepayment shall be either (i) deposited in the Collateral Account and
applied to the prepayment of LIBOR Loans on the last day of the then
next-expiring Interest Period for LIBOR Loans or (ii) prepaid immediately,
together with any amounts owing to the Lenders under Section 5.05.
Notwithstanding any such deposit in the Collateral Account, interest shall
continue to accrue on such Loans until prepayment.
(c) Revolving Credit Extension Reductions. Until the Revolving
Credit Commitment Termination Date, Borrower shall from time to time immediately
prepay the Swing Loans and the Revolving Credit Loans (and/or provide cover for
Letter of Credit Liabilities as specified in Section 2.10(d)) in such amounts as
shall be necessary so that at all times the aggregate outstanding amount of the
Revolving Credit Loans, plus the aggregate outstanding amount of Swing Loans,
plus the aggregate outstanding Letter of Credit Liabilities shall not exceed the
Revolving Credit Commitments as in effect at such time, such amount to be
applied, first, to Swing Loans, second, to Revolving Credit Loans outstanding
and, third, as cover for Letter of Credit Liabilities outstanding as specified
in Section 2.10(d).
(d) Cover for Letter of Credit Liabilities. In the event that
Borrower shall be required pursuant to this Section 2.10 to provide cover for
Letter of Credit Liabilities, Borrower shall effect the same by paying to
Administrative Agent immediately available funds in an amount equal to the
required amount, which funds shall be retained by Administrative Agent in the
Collateral Account (as provided in the Security Agreement as collateral security
in the first instance for the Letter of Credit Liabilities) until such time as
all Letters of Credit shall have been terminated and all of the Letter of Credit
Liabilities paid in full.
2.11. Replacement of Lenders. Borrower shall have the right,
if no Default then exists, to replace any Lender (the "Replaced Lender") with
one or more other Eligible Persons reasonably acceptable to Arrangers
(collectively, the "Replacement Lender") if (x) such Lender is charging Borrower
increased costs pursuant to Section 5.01, 5.06 or 12.03 (a)(ii)(3) in excess of
those being charged generally by the other Lenders or such Lender becomes
incapable of making LIBOR Loans as provided in Section 5.03 and/or (y) as
provided in Section 12.04(ii), such Lender refuses to consent to certain
proposed amendments, waivers or modifications with respect to this Agreement;
provided, however, that (i) at the time of any replacement pursuant to this
Section 2.11, the Replacement Lender shall enter into one or more assignment
agreements (and with all fees payable pursuant to said Section 12.06 to be paid
by the Replacement Lender) pursuant to which the Replacement Lender shall
acquire all of the Commitments and outstanding Loans of, and in each case Letter
of Credit Interests by, the Replaced Lender and, in connection therewith, shall
pay to (x) the Replaced Lender, an amount equal to the sum of (A) the principal
of, and all accrued interest on, all outstanding Loans of the Replaced Lender,
(B) all Reimbursement Obligations owing to such Replaced Lender, together with
all then unpaid interest with respect thereto at such time, and (C) all accrued,
but theretofore unpaid, fees owing to the Replaced Lender pursuant to Section
2.05, and (y) the Issuing Lender an amount equal to such Replaced Lender's
Revolving Credit Commitment Percentage of any Reimbursement Obligations (which
at such time remains a Reimbursement Obligation) to the extent such amount was
not theretofore funded by such Replaced Lender, and (ii) all obligations of
Borrower owing to the Replaced Lender (other than those specifically described
in clause (i) above in respect of which the assignment purchase price has been,
or is concurrently being, paid, but including any amounts which would be paid to
a Lender pursuant to Section 5.05 if Borrower were prepaying a LIBOR Loan) shall
be paid in full to such Replaced Lender concurrently with such replacement. 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 Notes executed by
Borrower, the Replacement Lender shall become a Lender hereunder and the
Replaced Lender shall cease to constitute a Lender hereunder and be released of
all its obligations as a Lender, except with respect to indemnification
provisions applicable to the Replaced Lender under this Agreement, which shall
survive as to such Replaced Lender.
Section 3. Payments of Principal and Interest.
3.01. Repayment of Loans.
(a) Revolving Credit and Swing Loans. Borrower hereby promises
to pay to Administrative Agent for the account of each Lender the entire
outstanding principal amount of such Lender's Revolving Credit Loans, and each
Revolving Credit Loan shall mature, on the Revolving Credit Commitment
Termination Date. Borrower hereby promises to pay the Swing Loan Lender for its
account the entire outstanding principal amount of the Swing Loans, and the
Swing Loans shall mature, on the Swing Loan Maturity Date.
(b) (1) Tranche A Term Loans. Borrower hereby promises to pay
to Administrative Agent for the account of the Tranche A Term Loan Lenders, in
repayment of the principal of the Tranche A Term Loans, the amounts set forth on
Schedule 3.01(b) on the dates set forth on Schedule 3.01(b) (subject to
adjustment for any prepayments required by Section 2.10 to the extent actually
made).
(2) Tranche B Term Loans. Borrower hereby promises to pay to
Administrative Agent, for the account of the Tranche B Term Loan Lenders, in
repayment of the principal of the Tranche B Term Loans, the amounts set forth in
Schedule 3.01(b) on the dates set forth in Schedule 3.01(b) (subject to
adjustment for any prepayments required by Section 2.10 to the extent actually
made).
(3) Tranche C Term Loans. Borrower hereby promises to pay to
Administrative Agent for the account of the Tranche C Term Loan Lenders, in
repayment of the principal of the Tranche C Term Loans, the amounts set forth on
Schedule 3.01(b) on the dates set forth on Schedule 3.01(b) (subject to
adjustment for any prepayments required by Section 2.10 to the extent actually
made).
3.02. Interest. (a) Borrower hereby promises to pay to
Administrative Agent for the account of each Lender interest on the unpaid
principal amount of each Loan made by such Lender for the period from and
including the date of such Loan to but excluding the date such Loan shall be
paid in full at the following rates per annum:
(i) during such periods as such Loan is an ABR Loan, the
Alternate Base Rate (as in effect from time to time), plus the
Applicable Margin and
(ii) during such periods as such Loan is a LIBOR Loan, for
each Interest Period relating thereto, the LIBOR Rate for such Loan for
such Interest Period, plus the Applicable Margin.
(b) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and other overdue amounts owed by any
Obligor under the Credit Documents (including such interest accruing before and
after judgment) shall bear interest at a rate per annum equal to (x) in the case
of principal of any Loans, the rate which is 2% in excess of the rate then borne
by such Loans, (y) in the case of interest, the rate which is 2% in excess of
the rate otherwise applicable to ABR Loans which are Revolving Credit Loans from
time to time and (z) in the case of such other amounts, the rate which is 2% in
excess of the rate otherwise applicable to ABR Loans which are Revolving Credit
Loans from time to time. Interest which accrues under this paragraph shall be
payable on demand.
(c) Accrued interest on each Loan shall be payable (i) in the
case of an ABR Loan, quarterly on the Quarterly Dates, (ii) in the case of a
LIBOR Loan, on the last day of each Interest Period therefor and, if such
Interest Period is longer than three months, at three-month intervals following
the first day of such Interest Period and (iii) in the case of any LIBOR Loan,
upon the payment or prepayment thereof or the Conversion of such Loan to a Loan
of another Type (but only on the principal amount so paid, prepaid or
Converted), except that interest payable at the rate set forth in Section
3.02(b) shall be payable from time to time on demand. Promptly after the
determination of any interest rate provided for herein or any change therein,
Administrative Agent shall give notice thereof to the Lenders to which such
interest is payable and to Borrower.
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
4.01. Payments. (a) Except to the extent otherwise provided
herein, all payments of principal, interest, Reimbursement Obligations and other
amounts to be made by Borrower under this Agreement and the Notes, and, except
to the extent otherwise provided therein, all payments to be made by the
Obligors under any other Credit Document, shall be made in Dollars, in
immediately available funds, without deduction, set-off or counterclaim, to
Administrative Agent at its account at the Principal Office, not later than
11:00 a.m. Houston, Texas time on the date on which such payment shall become
due (each such payment made after such time on such due date to be deemed to
have been made on the next succeeding Business Day).
(b) Borrower shall, at the time of making each payment under
this Agreement or any Note for the account of any Lender, specify (in accordance
with Section 2.09 and 2.10, if applicable) to Administrative Agent (which shall
so notify the intended recipient(s) thereof) the Loans, Reimbursement
Obligations or other amounts payable by Borrower hereunder to which such payment
is to be applied (and in the event that Borrower fails to so specify, or if an
Event of Default has occurred and is continuing, Administrative Agent may
distribute such payment to the Lenders for application to the Obligations under
the Credit Documents in such manner as it or the Majority Lenders, subject to
Section 4.02, may determine to be appropriate).
(c) Except to the extent otherwise provided in the second
sentence of Section 2.03(g), each payment received by Administrative Agent or by
Issuing Lender (through Administrative Agent) under this Agreement or any Note
for the account of any Lender shall be paid by Administrative Agent or by
Issuing Lender (through Administrative Agent), as the case may be, to such
Lender, in immediately available funds, (x) if the payment was actually received
by Administrative Agent or by Issuing Lender (through Administrative Agent), as
the case may be, prior to 11:00 a.m. (Houston, Texas time) on any day, on such
day and (y) if the payment was actually received by Administrative Agent or by
Issuing Lender (through Administrative Agent), as the case may be, after 11:00
a.m. (Houston, Texas time) on any day, by 1:00 p.m. (Houston, Texas time) on the
following Business Day (it being understood that to the extent that any such
payment is not made in full by Administrative Agent or by Issuing Lender
(through Administrative Agent), as the case may be, Administrative Agent shall
pay to such Lender, upon demand, interest at the Federal Funds Rate from the
date such amount was required to be paid to such Lender pursuant to the
foregoing clauses until the date Administrative Agent pays such Lender the
amount).
(d) If the due date of any payment under this Agreement or any
Note would otherwise fall on a day that is not a Business Day, such date shall
be extended to the next succeeding Business Day, and interest shall be payable
for any principal so extended for the period of such extension.
4.02. Pro Rata Treatment. Except to the extent otherwise
provided herein: (a) each borrowing of Loans of a particular Class from the
Lenders under Section 2.01 shall be made from the relevant Lenders, each payment
of commitment fee under Section 2.05 in respect of Commitments of a particular
Class shall be made for account of the relevant Lenders, and each termination or
reduction of the amount of the Commitments of a particular Class under Section
2.04 shall be applied to the respective Commitments of such Class of the
relevant Lenders, pro rata according to the amounts of their respective
Commitments of such Class; provided, however, that Swing Loans shall be made
only by, and interest thereon shall be paid by Borrower only to, the Swing Loan
Lender (subject to such Lender's obligations in respect of any participation
therein purchased by the other Revolving Credit Lenders as provided in Section
2.01(f)); (b) except as otherwise provided in Section 5.04, LIBOR Loans of any
Class having the same Interest Period shall be allocated pro rata among the
relevant Lenders according to the amounts of their respective Revolving Credit
and Term Loan Commitments (in the case of the making of Loans) or their
respective Revolving Credit and Term Loans (in the case of Conversions and
Continuations of Loans); (c) each payment or prepayment of principal of
Revolving Credit Loans or Term Loans by Borrower shall be made for account of
the relevant Lenders pro rata in accordance with the respective unpaid
outstanding principal amounts of the Loans of such Class held by them; and (d)
each payment of interest on Revolving Credit Loans and Term Loans by Borrower
shall be made for account of the relevant Lenders pro rata in accordance with
the amounts of interest on such Loans then due and payable to the respective
Lenders.
4.03. Computations. Interest on LIBOR Loans and commitment fee
and letter of credit fees shall be computed on the basis of a year of 360 days
and actual days elapsed (including the first day but excluding the last day)
occurring in the period for which payable and interest on ABR Loans and
Reimbursement Obligations shall be computed on the basis of a year of 365 or 366
days, as the case may be, and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable.
Notwithstanding the foregoing, for each day that the Alternate Base Rate is
calculated by reference to the Federal Funds Rate, interest on ABR Loans and
Reimbursement Obligations shall be computed on the basis of a year of 360 days
and actual days elapsed (including the first day but excluding the last day).
4.04. Minimum Amounts. Except for mandatory prepayments made
pursuant to Section 2.10 and Conversions or prepayments made pursuant to Section
5.04, each borrowing, Conversion and prepayment of principal of Loans (other
than Swing Loans, for which the minimum amounts thereof are in Section 2.01(f))
shall be in an amount at least equal to $1.0 million with respect to ABR Loans
and $1.0 million with respect to LIBOR Loans and in multiples of $100,000 in
excess thereof (borrowings, Conversions or prepayments of or into Loans of
different Types or, in the case of LIBOR Loans, having different Interest
Periods at the same time hereunder to be deemed separate borrowings, Conversions
and prepayments for purposes of the foregoing, one for each Type or Interest
Period). Anything in this Agreement to the contrary notwithstanding, the
aggregate principal amount of LIBOR Loans having the same Interest Period shall
be in an amount at least equal to $1.0 million and in multiples of $100,000 in
excess thereof and, if any LIBOR Loans or portions thereof would otherwise be in
a lesser principal amount for any period, such Loans or portions, as the case
may be, shall be ABR Loans during such period.
4.05. Certain Notices. Notices by Borrower to Administrative
Agent of terminations or reductions of the Commitments, of borrowings,
Conversions, Continuations and optional prepayments of Loans and of Classes of
Loans, of Types of Loans and of the duration of Interest Periods shall be
irrevocable and shall be effective only if received by Administrative Agent by
telephone not later than 11:00 a.m. Houston, Texas time (promptly followed by
written notice via telecopier) on the number of Business Days prior to the date
of the relevant termination, reduction, borrowing, Conversion, Continuation or
prepayment or the first day of such Interest Period specified in the table below
(and not later than 11:00 a.m. Houston, Texas time on the Business Day of the
borrowing or prepayment in the case of Swing Loans).
NOTICE PERIODS
Number of Business
Notice Days Prior
- ------ --------------------
Termination or reduction of Commitments 2
Borrowing or optional prepayment of, or Conversions
into, ABR Loans (other than Swing Loans)
1
Borrowing or optional prepayment of, Conversions into,
Continuations as, or duration of Interest Periods for,
LIBOR Loans 3
Each such notice of termination or reduction shall specify the
amount and the Class of the Commitments to be terminated or reduced. Each such
notice of borrowing, Conversion, Continuation or prepayment shall specify the
Class of Loans to be borrowed, Converted, Continued or prepaid and the amount
(subject to Section 4.04) and Type of each Loan to be borrowed, Converted,
Continued or prepaid and the date of borrowing, Conversion, Continuation or
prepayment (which shall be a Business Day). Each such notice of the duration of
an Interest Period shall specify the Loans to which such Interest Period is to
relate. Unless otherwise consented to by Arrangers in their sole discretion,
prior to the earlier of (x) three Business Days after the Closing Date, and (y)
the date on which Borrower has been notified by Arrangers that the primary
syndication of the Commitments has been completed, no borrowing of or Conversion
into any LIBOR Loan may be made, and, in addition to the foregoing limitation,
prior to the earlier of (x) three months after the Closing Date and (y) the date
on which Borrower has been notified by Arrangers that the primary syndication of
the Commitments has been completed, no Interest Period of more than one month
may be elected. Administrative Agent shall promptly notify the Lenders of the
contents of each such notice. In the event that Borrower fails to select the
Type of Loan, or the duration of any Interest Period for any LIBOR Loan, within
the time period and otherwise as provided in this Section 4.05, such Loan (if
outstanding as a LIBOR Loan) will be automatically Converted into an ABR Loan on
the last day of the then current Interest Period for such Loan or (if
outstanding as an ABR Loan) will remain as, or (if not then outstanding) will be
made as, an ABR Loan.
4.06. Non-Receipt of Funds by Administrative Agent. Unless
Administrative Agent shall have received written notice from a Lender or
Borrower (the "Payor") prior to the date on which the Payor is to make payment
to Administrative Agent of (in the case of a Lender) the proceeds of a Loan to
be made by such Lender hereunder or a payment to Administrative Agent for the
account of one or more of the Lenders hereunder (such payment being herein
called the "Required Payment"), which notice shall be effective upon receipt,
that the Payor does not intend to make the Required Payment to Administrative
Agent, Administrative Agent may assume that the Required Payment has been made
and may, in reliance upon such assumption (but shall not be required to), make
the amount thereof available to the intended recipient(s) on such date; and, if
the Payor has not in fact made the Required Payment to Administrative Agent, the
recipient(s) of such payment shall, on demand, repay to Administrative Agent the
amount so made available together with interest thereon in respect of each day
during the period commencing on the date (the "Advance Date") such amount was so
made available by Administrative Agent until the date Administrative Agent
recovers such amount at a rate per annum equal to the Federal Funds Rate for
such day and, if such recipient(s) shall fail promptly to make such payment,
Administrative Agent shall be entitled to recover such amount, on demand, from
the Payor, together with interest as aforesaid; provided, however, that if
neither the recipient(s) nor the Payor shall return the Required Payment to
Administrative Agent within three Business Days of the date such demand was
made, then, retroactively to the Advance Date, the Payor and the recipient(s)
shall each be obligated to pay interest on the Required Payment as follows
(without double recovery):
(i) if the Required Payment shall represent a payment to be
made by Borrower to the Lenders, Borrower and the recipient(s) shall
each be obligated retroactively to the Advance Date to pay interest in
respect of the Required Payment at the rate set forth in Section
3.02(b) (without duplication of the obligation of Borrower under
Section 3.02 to pay interest on the Required Payment at the rate set
forth in Section 3.02(b)), it being understood that the return by the
recipient(s) of the Required Payment to Administrative Agent shall not
limit such obligation of Borrower under Section 3.02 to pay interest at
the rate set forth in Section 3.02(b) in respect of the Required
Payment and
(ii) if the Required Payment shall represent proceeds of a
Loan to be made by the Lenders to Borrower, the Payor and Borrower
shall each be obligated retroactively to the Advance Date to pay
interest in respect of the Required Payment pursuant to Section 3.02,
it being understood that the return by Borrower of the Required Payment
to Administrative Agent shall not limit any claim Borrower may have
against the Payor in respect of such Required Payment.
4.07. Right of Setoff; Sharing of Payments; Etc. (a) If any
Event of Default shall have occurred and be continuing, each Obligor agrees
that, in addition to (and without limitation of) any right of setoff, banker's
lien or counterclaim a Lender may otherwise have, each Lender shall be entitled,
at its option (to the fullest extent permitted by law), to set off and apply any
deposit (general or special, time or demand, provisional or final), or other
indebtedness, held by it for the credit or account of such Obligor at any of its
offices, in Dollars or in any other currency, against any principal of or
interest on any of such Lender's Loans, Reimbursement Obligations or any other
amount payable to such Lender hereunder that is not paid when due (regardless of
whether such deposit or other indebtedness is then due to such Obligor), in
which case it shall promptly notify such Obligor and Administrative Agent
thereof; provided, however, that such Lender's failure to give such notice shall
not affect the validity thereof.
(b) Each of the Lenders agrees that, if it should receive
(other than pursuant to Section 5) 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, Reimbursement Obligations or 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 amounts then owed and due to
such Lender bears to the total of such amounts 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 Obligor to such
Lenders in such amount as shall result in a proportional participation by all of
the Lenders in such amount; provided, however, 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. Borrower consents to the foregoing arrangements.
(c) Borrower agrees that any Lender so purchasing such a
participation may exercise all rights of setoff, banker's lien, counterclaim or
similar rights with respect to such participation as fully as if such Lender
were a direct holder of Loans or other amounts (as the case may be) owing to
such Lender in the amount of such participation.
(d) Nothing contained herein shall require any Lender to
exercise any such right or shall affect the right of any Lender to exercise, and
retain the benefits of exercising, any such right with respect to any other
Indebtedness or obligation of any Obligor. If, under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a setoff to which this Section 4.07 applies, such Lender shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders entitled under this Section 4.07 to
share in the benefits of any recovery on such secured claim.
Section 5. Yield Protection, Etc.
5.01. Additional Costs. (a) If the adoption of, or any change
in, in each case after the date hereof any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority or the NAIC made subsequent to the date
hereof:
(i) shall subject any Lender or Issuing Lender to any tax of
any kind whatsoever with respect to this Agreement, any Note, any
Letter of Credit or any Lender's participation therein, any Letter of
Credit Document or any LIBOR Loan made by it or change the basis of
taxation of payments to such Lender in respect thereof by any
Governmental Authority (except for taxes covered by or expressly
excluded from coverage by Section 5.06 and changes in the rate of tax
on the overall net income of such Lender or its Applicable Lending
Office, or any affiliate thereof or franchise tax by any Governmental
Authority);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender or Issuing Lender
which is not otherwise included in the determination of the LIBOR Rate
hereunder; or
(iii) shall impose on such Lender or Issuing Lender any other
condition (excluding taxes);
and the result of any of the foregoing is to increase the cost to such Lender or
Issuing Lender, by an amount which such Lender or Issuing Lender deems to be
material, of making, converting into, continuing or maintaining LIBOR Loans or
issuing or participating in Letters of Credit or to reduce any amount receivable
hereunder in respect thereof then, in any such case, Borrower shall promptly pay
such Lender or Issuing Lender, upon its written demand, any additional amounts
necessary to compensate such Lender or Issuing Lender for such increased cost or
reduced amount receivable. If any Lender or Issuing Lender becomes entitled to
claim any additional amounts pursuant to this subsection, it shall promptly
notify Borrower, through Administrative Agent, of the event by reason of which
it has become so entitled. A certificate as to any additional amounts setting
forth the calculation of such additional amounts pursuant to this Section 5.01
submitted by such Lender or Issuing Lender, through Administrative Agent, to
Borrower shall be conclusive in the absence of clearly demonstrable error.
Without limiting the survival of any other covenant hereunder, but subject to
Section 5.01(c), this Section 5.01 shall survive the termination of this
Agreement and the payment of the Notes and all other amounts payable hereunder.
(b) In the event that any Lender or Issuing Lender shall have
determined that the adoption after the date hereof of any law, rule, regulation
or guideline regarding capital adequacy (or any change after the date hereof
therein or in the interpretation or application thereof) or compliance by any
Lender or Issuing Lender or any corporation controlling such Lender or Issuing
Lender with any request or directive regarding capital adequacy (whether or not
having the force of law) from any central bank or Governmental Authority or the
NAIC, in each case, made subsequent to the date hereof including, without
limitation, the issuance after the date hereof of any final rule, regulation or
guideline, does or shall have the effect of reducing the rate of return on such
Lender's or Issuing Lender's or such corporation's capital as a consequence of
its obligations hereunder or under any Letter of Credit to a level below that
which such Lender or Issuing Lender or such corporation could have achieved but
for such adoption, change or compliance (taking into consideration such Lender's
or Issuing Lender's or such corporation's policies with respect to capital
adequacy) by an amount deemed by such Lender or Issuing Lender to be material,
then from time to time, after submission by such Lender or Issuing Lender to
Borrower (with a copy to Administrative Agent) of a written request therefor,
Borrower shall promptly pay to such Lender or Issuing Lender such additional
amount or amounts as will compensate such Lender or Issuing Lender for such
reduction.
(c) Each Lender (and Issuing Lender) shall notify Borrower of
any event that will entitle such Lender (or Issuing Lender, as the case may be)
to compensation under paragraph (a) or (b) of this Section 5.01 as promptly as
practicable, but in any event within 90 days after such Lender (or Issuing
Lender, as the case may be) obtains actual knowledge thereof; provided, however,
that (i) if any Lender (or Issuing Lender, as the case may be) fails to give
such notice within 90 days after it obtains actual knowledge of such an event,
such Lender (or Issuing Lender, as the case may be) shall, with respect to
compensation payable pursuant to this Section 5.01 in respect of any costs
resulting from such event, only be entitled to payment under this Section 5.01
for costs incurred from and after the date 90 days prior to the date that such
Lender (or Issuing Lender, as the case may be) does give such notice and (ii)
each Lender (or Issuing Lender, as the case may be), will designate a different
Applicable Lending Office for the Loans of such Lender (or the Letters of
Credit, as the case may be) affected by such event if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the sole opinion of such Lender (or Issuing Lender, as the case may be), be
disadvantageous to such Lender (or Issuing Lender, as the case may be). Each
Lender (or Issuing Lender, as the case may be) will furnish to the Company at
the time of request for compensation under paragraph (a) or (b) of this Section
5.01 a certificate setting forth the basis, amount and reasonable detail of
computation of each request by such Lender for compensation under paragraph (a)
or (b) of this Section 5.01, which certificate shall, except for demonstrable
error, be final, conclusive and binding for all purposes.
5.02. Limitation on Types of Loans. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of any LIBOR Base
Rate for any Interest Period:
(i) Administrative Agent determines, which determination
shall be conclusive, absent manifest error, that quotations of interest
rates for the relevant deposits referred to in the definition of "LIBOR
Base Rate" in Section 1.01 are not being provided in the relevant
amounts or for the relevant maturities for purposes of determining
rates of interest for LIBOR Loans as provided herein; or
(ii) if the related Loans are Revolving Credit Loans, the
Majority Revolving Credit Lenders or, if the related Loans are Tranche
A Term Loans, the Majority Tranche A Term Loan Lenders or, if the
related Loans are Tranche B Term Loans, the Majority Tranche B Term
Loan Lenders or, if the related Loans are Tranche C Term Loans, the
Majority Tranche C Term Loan Lenders determine, which determination
shall be conclusive, that the relevant rates of interest referred to in
the definition of "LIBOR Base Rate" in Section 1.01 upon the basis of
which the rate of interest for LIBOR Loans for such Interest Period is
to be determined are not likely adequate to cover the cost to the
applicable Lenders of making or maintaining LIBOR Loans for such
Interest Period,
then Administrative Agent shall give Borrower and each Lender prompt notice
thereof, and so long as such condition remains in effect, the affected Lenders
shall be under no obligation to make additional LIBOR Loans (but shall make
their portion of any additional Borrowings as ABR Loans), to Continue LIBOR
Loans or to Convert ABR Loans into LIBOR Loans and Borrower shall, on the last
day(s) of the then current Interest Period(s) for the outstanding LIBOR Loans,
either prepay such Loans of such affected Lenders or Convert such Loans of such
affected Lenders into ABR Loans in accordance with Section 2.09.
5.03. Illegality. Notwithstanding any other provision of this
Agreement, in the event that any change after the date hereof in any Requirement
of Law or in the interpretation or application thereof shall make it unlawful
for any Lender or Issuing Lender or its Applicable Lending Office to honor its
obligation to make or maintain LIBOR Loans or issue Letters of Credit hereunder
(and, in the sole opinion of such Lender or Issuing Lender, the designation of a
different Applicable Lending Office would either not avoid such unlawfulness or
would be disadvantageous to such Lender or Issuing Lender), then such Lender or
Issuing Lender shall promptly notify Borrower thereof (with a copy to
Administrative Agent) and such Lender's or Issuing Lender's obligation to make
or Continue, or to Convert Loans of any other Type into, LIBOR Loans or issue
Letters of Credit shall be suspended until such time as such Lender or Issuing
Lender may again make and maintain LIBOR Loans or issue Letters of Credit (in
which case the provisions of Section 5.04 shall be applicable).
5.04. Treatment of Affected Loans. If the obligation of any
Lender to make LIBOR Loans or to Continue, or to Convert ABR Loans into, LIBOR
Loans shall be suspended pursuant to Section 5.03, such Lender's LIBOR Loans
shall be automatically Converted into ABR Loans on the last day(s) of the then
current Interest Period(s) for such LIBOR Loans (or on such earlier date as such
Lender may specify to Borrower with a copy to Administrative Agent as is
required by law) and, unless and until such Lender gives notice as provided
below that the circumstances specified in Section 5.03 which gave rise to such
Conversion no longer exist:
(i) to the extent that such Lender's LIBOR Loans have been
so Converted, all payments and prepayments of principal which would
otherwise be applied to such Lender's LIBOR Loans shall be applied
instead to its ABR Loans; and
(ii) all Loans which would otherwise be made or Continued by
such Lender as LIBOR Loans shall be made or Continued instead as ABR
Loans and all ABR Loans of such Lender which would otherwise be
Converted into LIBOR Loans shall remain as ABR Loans.
If such Lender gives notice to Borrower with a copy to Administrative Agent that
the circumstances specified in Section 5.03 which gave rise to the Conversion of
such Lender's LIBOR Loans pursuant to this Section 5.04 no longer exist (which
such Lender agrees to do promptly upon such circumstances ceasing to exist) at a
time when LIBOR Loans are outstanding, such Lender's ABR Loans shall be
automatically Converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding LIBOR Loans, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans
and by such Lender are held pro rata (as to principal amounts, Types and
Interest Periods) in accordance with their respective Commitments.
5.05. Compensation. (a) Borrower agrees to indemnify each
Lender and to hold each Lender harmless from any loss or expense which such
Lender may sustain or incur as a consequence of (1) default by Borrower in
payment when due of the principal amount of or interest on any LIBOR Loan, (2)
default by Borrower in making a borrowing of, Conversion into or Continuation of
LIBOR Loans after Borrower has given a notice requesting the same in accordance
with the provisions of this Agreement, (3) default by Borrower in making any
prepayment after Borrower has given a notice thereof in accordance with the
provisions of the Agreement, or (4) the making of a payment or a prepayment of
LIBOR Loans on a day which is not the last day of an Interest Period with
respect thereto, including in each case, any such loss (including loss of margin
but not the Applicable Margin) or expense arising from the reemployment of funds
obtained by it or from fees payable to terminate the deposits from which such
funds were obtained.
(b) For the purpose of calculation of all amounts payable to a
Lender under this Section 5.05 each Lender shall be deemed to have actually
funded its relevant LIBOR Loan through the purchase of a deposit bearing
interest at the LIBOR Rate in an amount equal to the amount of the LIBOR Loan
and having a maturity comparable to the relevant Interest Period; provided,
however, that each Lender may fund each of its LIBOR Loans in any manner it sees
fit, and the foregoing assumption shall be utilized only for the calculation of
amounts payable under this subsection. Any Lender requesting compensation
pursuant to this Section 5.05 will furnish to Administrative Agent and Borrower
a certificate setting forth the basis and amount of such request and such
certificate, absent manifest error, shall be conclusive. Without limiting the
survival of any other covenant hereunder, this covenant shall survive the
termination of this Agreement and the payment of the Notes and all other amounts
payable hereunder.
5.06. Net Payments. (a) All payments made by Borrower or any
Guarantor hereunder or under any Note or any Guarantee will be made without
setoff, counterclaim or other defense. Except as provided in Section 5.06(b),
all such payments will be made free and clear of, and without deduction or
withholding for, any present or future Taxes now or hereafter imposed by any
Governmental Authority or by any political subdivision or taxing authority
thereof or therein with respect to such payments (but excluding any Excluded
Tax) and all interest, penalties or similar liabilities with respect thereto
except in each case to the extent that such interest, penalties or similar
liabilities with respect to any Lender are attributable to such Lender's failure
to comply with Section 5.06(b) (all such Taxes (other than Excluded Taxes) being
referred to collectively as "Covered Taxes"). If any Covered Taxes are so levied
or imposed, Borrower and each Guarantor, as the case may be, agrees on a joint
and several basis to pay the full amount of such Covered Taxes, and such
additional amounts as may be necessary so that every payment of all amounts due
under this Agreement, the Guarantees or under any Note, after withholding or
deduction for or on account of any Covered Taxes, will not be less than the
amount provided for herein or in such Note. If any amounts are payable in
respect of Covered Taxes pursuant to the preceding sentence, Borrower and each
Guarantor agrees, notwithstanding the definition of Excluded Taxes, to reimburse
on a joint and several basis each Lender, upon the written request of such
Lender, (i) 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
authority of any such jurisdiction by reason of the making of payments in
respect of Covered Taxes pursuant to this Section (including pursuant to this
sentence) and (ii) for any withholding of Taxes as such Lender shall determine
are payable by, or withheld from, such Lender in respect of amounts paid in
respect of Covered Taxes 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. Borrower and each Guarantor, as the case may
be, will furnish to Administrative Agent within 45 days after the date the
payment of any Covered Taxes is due pursuant to applicable law certified copies
of tax receipts or other documentation reasonably satisfactory to such Lender
evidencing such payment by Borrower or any Guarantor. Borrower and the
Guarantors agree to jointly and severally indemnify and hold harmless each
Lender, and reimburse such Lender upon its written request, for the amount of
any Covered Taxes so levied or imposed and paid by such Lender and any liability
(including penalties, additions to tax, interest and expenses) arising therefrom
or with respect thereto.
"Excluded Taxes" shall mean (x) other than as provided in the
third sentence of the first paragraph of this Section 5.06(a), any Tax (other
than any Other Taxes) 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 jurisdiction in which such Lender conducts
business or any subdivision thereof or therein and (y) any Tax (other than any
Other Taxes) that existed on the date such Lender became a party to this
Agreement, except that this clause (y) shall not apply to the extent that (1)
the amount that such Lender would claim as Covered Taxes but for this clause (y)
does not exceed the amount thereof that the assignor to such Lender would have
been entitled to receive at the date of assignment or (2) such Lender became a
Lender upon request of Borrower.
(b) Each Lender that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) (a "Non-U.S. Lender") agrees
to deliver to Borrower and Administrative Agent on or prior to the Closing Date
or, in the case of a Lender that is an assignee or transferee of an interest
under this Agreement pursuant to Section 12.06 (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 4224 or 1001
(or successor forms) certifying to such Lender's entitlement to a complete
exemption from, or reduction in rate of, United States withholding tax with
respect to payments to be made under this Agreement and under any Note (or, with
respect to any assignee Lender, at least as extensive as the assigning Lender),
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 1001 or 4224
pursuant to clause (i) above, (x) a certificate substantially in the form of
Exhibit J (any such certificate, a "Section 5.06 Certificate") and (y) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 (or successor form) certifying to such Lender's entitlement to a complete
exemption from, or reduction in rate of, United States withholding tax with
respect to payments to be made under this Agreement and under any Note (or, with
respect to any assignee Lender, at least as extensive as the assigning Lender).
In addition, each Lender agrees that from time to time after the Closing Date,
when a lapse in time or change in circumstances renders the previous
certification obsolete or inaccurate in any material respect, it will deliver to
Borrower and Administrative Agent two new accurate and complete original signed
copies of Internal Revenue Service Form 4224 or 1001, or Form W-8 and a Section
5.06 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
Borrower and 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 5.06(b). Notwithstanding the
foregoing, no Lender shall be required to deliver any such form or certificate
if a change in treaty, law or regulation has occurred prior to the date on which
such delivery would otherwise be required that renders any such form or
certificate inapplicable or would prevent the Lender from duly completing and
delivering any such form or certificate with respect to it and such Lender so
advises Borrower. Neither Borrower nor any Guarantor shall be required to
indemnify any Non-U.S. Lender, or to pay any additional amounts to any Non-U.S.
Lender, in respect of any Covered Taxes to the extent that (i) the obligation to
pay such Covered Taxes would not have arisen but for a failure by such Non-U.S.
Lender to comply with the provisions of this Section 5.06(b) or (ii) if the
Internal Revenue Service properly determines that a Lender is a "conduit entity"
participating in a "conduit financing arrangement" within the meaning of
Treasury Regulation Section 1.881-3, such additional amounts are in excess of
the amounts that would otherwise have been payable had such Lender not been a
"conduit entity" participating in a "conduit financing arrangement" within the
meaning of Treasury Regulation Section 1.881-3. Notwithstanding anything to the
contrary contained in the preceding sentence or elsewhere in this Section 5.06
and except as set forth in Section 12.06(b), Borrower agrees to pay additional
amounts and to indemnify each Lender in the manner set forth in Section 5.06(a)
(without regard to the identity of the jurisdiction requiring the deduction or
withholding) in respect of any amounts deducted or withheld by it as described
in the immediately preceding sentence as a result of any changes after the
Closing Date in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of income or similar Covered Taxes.
(c) In addition, Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under the Note or
from the execution, delivery or registration of, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "Other Taxes").
(d) Any Lender claiming any additional amounts payable
pursuant to this Section 5.06 agrees to use (at the Obligors' expense)
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to change the jurisdiction of its Applicable Lending Office if the
making of such change would avoid the need for, or reduce the amount of, any
such additional amounts that may thereafter accrue and would not, in the sole
judgment of such Lender, be otherwise disadvantageous to such Lender.
(e) If Borrower or any Guarantor pays any additional amount
under this Section 5.06 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 (a "Tax
Benefit"), such Lender shall pay to such Borrower or such Guarantor, as the case
may be, 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 Tax Benefit; provided, however, that (i) such
Lender shall not be required to make any payment under this Section 5.06(e) if
an Event of Default shall have occurred and be continuing; (ii) any taxes that
are imposed on a Lender as a result of a disallowance or reduction (including
through the expiration of any tax credit carryover or carryback of such Lender
that otherwise would not have expired) of any Tax Benefit with respect to which
such Lender has made a payment to Borrower or any Guarantor pursuant to this
Section 5.06(e) shall be treated as a tax for which Borrower or any Guarantor is
obligated to indemnify such Lender pursuant to this Section 5.06 without any
exclusions or defenses; and (iii) nothing in this Section 5.06(e) shall require
the Lender to disclose any confidential information to Borrower or any Guarantor
(including its tax returns).
Section 6. Guarantee.
6.01. The Guarantee. The Guarantors hereby jointly and
severally guarantee as a primary obligor and not as a surety to each Lender,
Issuing Lender and Agent and their respective successors and assigns the prompt
payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the principal of and interest (including any interest, fees, costs
or charges that would accrue but for the provisions of the Bankruptcy Code after
any bankruptcy or insolvency petition under the Bankruptcy Code) on the Loans
made by the Lenders to, and the Notes held by each Lender of, Borrower and all
other Obligations from time to time owing to the Lenders, Issuing Lender or
Agents by Borrower under this Agreement and under the Notes and by any Obligor
under any of the other Credit Documents, and all obligations of Borrower or any
Subsidiary to any Lender or any Affiliate of any Lender in respect of any Swap
Contract and all Obligations owing to the Issuing Lender under the Letter of
Credit Documents, in each case strictly in accordance with the terms thereof
(such obligations being herein collectively called the "Guaranteed
Obligations"). The Guarantors hereby jointly and severally agree that if
Borrower shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors
will promptly pay the same, without any demand or notice whatsoever, and that in
the case of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration or otherwise) in accordance with the terms of
such extension or renewal.
6.02. Obligations Unconditional. The obligations of the
Guarantors under Section 6.01 are absolute, irrevocable and unconditional, joint
and several, irrespective of the value, genuineness, validity, regularity or
enforceability of the obligations of Borrower under this Agreement, the Notes or
any other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
Guarantor (except for payment in full). Without limiting the generality of the
foregoing, it is agreed that the occurrence of any one or more of the following
shall not alter or impair the liability of the Guarantors hereunder which shall
remain absolute, irrevocable and unconditional under any and all circumstances
as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of
the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of
this Agreement or the Notes or any other agreement or instrument
referred to herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall
be accelerated, or any of the Guaranteed Obligations shall be amended
in any respect, or any right under this Agreement, the Notes or any
other Credit Document or any other agreement or instrument referred to
herein or therein shall be amended or waived in any respect or any
other guarantee of any of the Guaranteed Obligations or any security
therefor shall be released or exchanged in whole or in part or
otherwise dealt with;
(iv) any lien or security interest granted to, or in favor
of, the Issuing Lender or any Lender or Agent as security for any of
the Guaranteed Obligations shall fail to be perfected; or
(v) the release of any other Guarantor.
The Guarantors hereby expressly waive diligence, presentment,
demand of payment, protest and all notices whatsoever, and any requirement that
the Issuing Lender or any Agent or any Lender exhaust any right, power or remedy
or proceed against Borrower under this Agreement or the Notes or any other
agreement or instrument referred to herein or therein, or against any other
Person under any other guarantee of, or security for, any of the Guaranteed
Obligations. The Guarantors waive any and all notice of the creation, renewal,
extension, waiver, termination or accrual of any of the Guaranteed Obligations
and notice of or proof of reliance by the Issuing Lender, any Lender or any
Agent upon this guarantee or acceptance of this guarantee, and the Guaranteed
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred in reliance upon this guarantee, and all dealings between
Borrower and the Issuing Lender, Lenders and Agents shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
guarantee. This guarantee shall be construed as a continuing, absolute,
irrevocable and unconditional guarantee of payment without regard to any right
of offset with respect to the Guaranteed Obligations at any time or from time to
time held by the Issuing Lender, Lenders and Agents, and the obligations and
liabilities of the Guarantors hereunder shall not be conditioned or contingent
upon the pursuit by the Issuing Lender, Lenders or Agents or any other Person at
any time of any right or remedy against Borrower or against any other Person
which may be or become liable in respect of all or any part of the Guaranteed
Obligations or against any collateral security or guarantee therefor or right of
offset with respect thereto. This guarantee shall remain in full force and
effect and be binding in accordance with and to the extent of its terms upon the
Guarantors and the successors and assigns thereof, and shall inure to the
benefit of the Lenders, and their respective successors and assigns,
notwithstanding that from time to time during the term of this Agreement there
may be no Guaranteed Obligations outstanding.
6.03. Reinstatement. The obligations of the Guarantors under
this Section 6 shall be automatically reinstated if and to the extent that for
any reason any payment by or on behalf of Borrower in respect of the Guaranteed
Obligations is rescinded or must be otherwise restored by any holder of any of
the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise. The Guarantors jointly and severally agree that
they will indemnify the Issuing Lender, each Agent and each Lender on demand for
all reasonable costs and expenses (including reasonable fees of counsel)
incurred by the Issuing Lender, such Agent or such Lender in connection with
such rescission or restoration, including any such costs and expenses incurred
in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law, other than any costs or expenses resulting from the
gross negligence or bad faith of such Creditor.
6.04. Subrogation; Subordination. Each Guarantor hereby agrees
that until the indefeasible payment and satisfaction in full in cash of all
Guaranteed Obligations and the expiration and termination of the Commitments of
the Lenders under this Agreement it shall not exercise any right or remedy
arising by reason of any performance by it of its guarantee in Section 6.01,
whether by subrogation or otherwise, against Borrower or any other Guarantor of
any of the Guaranteed Obligations or any security for any of the Guaranteed
Obligations. The payment of any amounts due with respect to any indebtedness of
Borrower or any other Guarantor now or hereafter owing to any Guarantor by
reason of any payment by such Guarantor under the Guarantee in this Section 6 is
hereby subordinated to the prior indefeasible payment in full in cash of the
Guaranteed Obligations. Each Guarantor agrees that it will not demand, sue for
or otherwise attempt to collect any such indebtedness of Borrower to such
Guarantor until the Obligations shall have been indefeasibly paid in full in
cash. If, notwithstanding the foregoing sentence, any Guarantor shall prior to
the indefeasible payment in full in cash of the Guaranteed Obligations collect,
enforce or receive any amounts in respect of such indebtedness, such amounts
shall be collected, enforced and received by such Guarantor as trustee for
Arrangers, the Issuing Lender and the Lenders and be paid over to Administrative
Agent on account of the Guaranteed Obligations without affecting in any manner
the liability of such Guarantor under the other provisions of the guaranty
contained herein.
6.05. Remedies. The Guarantors jointly and severally agree
that, as between the Guarantors and the Lenders, the obligations of Borrower
under this Agreement and the Notes may be declared to be forthwith due and
payable as provided in Section 10 (and shall be deemed to have become
automatically due and payable in the circumstances provided in said Section 10)
for purposes of Section 6.01 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against Borrower and that, in the event of
such declaration (or such obligations being deemed to have become automatically
due and payable), such obligations (whether or not due and payable by Borrower)
shall forthwith become due and payable by the Guarantors for purposes of Section
6.01.
6.06. Instrument for the Payment of Money. Each Guarantor
hereby acknowledges that the guarantee in this Section 6 constitutes an
instrument for the payment of money, and consents and agrees that any Lender or
Agent, at its sole option, in the event of a dispute by such Guarantor in the
payment of any moneys due hereunder, shall have the right to bring motion-action
under New York CPLR Section 3213.
6.07. Continuing Guarantee. The guarantee in this Section 6
is a continuing guarantee, and shall apply to all Guaranteed Obligations
whenever arising.
6.08. General Limitation on Guarantee Obligations. In any
action or proceeding involving any state corporate law, or any state, Federal or
foreign bankruptcy, insolvency, reorganization or other law affecting the rights
of creditors generally, if the obligations of any Guarantor under Section 6.01
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under Section 6.01, then, notwithstanding any
other provision to the contrary, the amount of such liability shall, without any
further action by such Guarantor, any Lender, any Agent or any other Person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding.
Section 7. Conditions Precedent.
7.01. Effectiveness and Initial Extension of Credit. The
effectiveness of the Credit Documents and the obligation of the Lenders to make
any initial extension of credit hereunder (whether by making a Loan or issuing a
Letter of Credit) is subject to the satisfaction of the conditions precedent
that:
(i) Documentation and Evidence of Certain Matters. Arrangers
shall have received the following documents, each duly executed where
appropriate (with sufficient conformed copies for each Lender), each of
which shall be reasonably satisfactory to Arrangers (and to the extent
specified below, to the Majority Lenders or to each Lender, as the case
may be) in form and substance:
(1) Corporate Documents. Certified true and complete
copies of the charter and by-laws and all amendments thereto
(or equivalent documents) of each Obligor and of all corporate
authority for each Obligor (including board of director
resolutions and evidence of the incumbency, including specimen
signatures, of officers) with respect to the execution,
delivery and performance of such of the Credit Documents to
which such Obligor is intended to be a party and each other
document to be delivered by such Obligor from time to time in
connection herewith and the extensions of credit hereunder and
the consummation of the Transactions, certified as of the
Closing Date as complete and correct copies thereof by the
Secretary or an Assistant Secretary of such Obligor.
(2) Officers' Certificate. An Officers' Certificate
of Borrower, dated the Closing Date, to the effect set forth
in clauses (a) and (b) of Section 7.02(i) and to the effect
that all conditions precedent to the making of such extension
of credit have been satisfied.
(3) Opinions of Counsel. (i) Opinion of Latham &
Watkins, counsel to the Obligors, substantially in the form of
Exhibit E-1, and (ii) Opinion of Latham & Watkins, special FCC
counsel to the Obligors, substantially in the form of Exhibit
E-2 (and each Obligor hereby instructs such counsel to deliver
such opinion to the Lenders and Arrangers).
(4) The Credit Agreement. This Agreement, (i)
executed and delivered by a duly authorized officer of each
Obligor with a counterpart for each Lender, and (ii) executed
and delivered by a duly authorized officer of each Lender and
Agent.
(5) Notes. The Notes, duly completed and executed
for each Lender that has requested Notes prior to the Closing
Date.
(6) Security Documents. The Security Agreement, the
Collateral Assignment of Location Agreements and such other
pledge agreements required under local law in the judgment of
counsel to Administrative Agent and requested reasonably in
advance of the intended Closing Date (each of which shall be
in full force and effect), duly authorized, executed and
delivered by the Obligors and Administrative Agent, and the
certificates identified under the name of such Obligors in
Annex 1 to the Security Agreement, accompanied by undated
stock powers executed in blank if applicable, and the notes
identified under the name of such Obligors in Annex 1B to the
Security Agreement, accompanied by undated notations or
instruments of assignment executed in blank.
(7) Solvency Certificate and Opinion. A certificate
from the chief financial officer of Borrower and, at
Borrower's expense, an opinion of Valuation Research in form
and substance reasonably satisfactory to Arrangers with
respect to the Solvency of Parent (on a consolidated basis)
and of Borrower (on a consolidated basis) immediately after
giving effect to the Transactions.
(8) Insurance. Evidence of insurance complying with
the requirements of Section 9.04 and the Security Documents
and certificates naming Administrative Agent as an additional
insured and/or loss payee, and stating that such insurance
shall not be canceled or revised without 30 days prior written
notice by the insurer to Administrative Agent.
(9) Transaction Documents, etc. Copies of the Merger
Agreement, the Parent Financing Documents, the New Preferred
Documents, the Laredo JV Agreement, any management or similar
agreement entered into by any Obligor or any executive officer
or director thereof with any Excluded Person or any of their
Affiliates and all exhibits, appendices, annexes and schedules
to any thereof, each certified by a senior officer of Borrower
as true, complete and correct copies thereof.
(10) Repayment of Existing Credit Facility. Evidence
in the form of a "pay-off" letter that the principal of and
interest on, and all other amounts owing in respect of, the
Existing Credit Facility have been (or shall be
simultaneously) paid in full, that any commitments to extend
credit under the agreements or instruments relating to such
Indebtedness have been canceled or terminated and that all
guarantees in respect of, and all Liens securing, any such
Indebtedness have been released (or arrangements for such
release satisfactory to Arrangers have been made); in
addition, from any Person holding any Lien securing any such
Indebtedness, such Uniform Commercial Code termination
statements, mortgage releases and other instruments, in each
case in proper form for recording, as Arrangers shall have
reasonably requested to release and terminate of record the
Liens securing such Indebtedness (or arrangements for such
release and termination reasonably satisfactory to Arrangers
and the Majority Lenders have been made).
(11) Financial Statements. Unaudited interim combined
financial statements of PriCellular for each fiscal month and
quarterly period ended subsequent to December 31, 1997 as to
which such financial statements are available and such
financial statements shall not, in the reasonable judgment of
the Lenders, reflect any material adverse change in the
consolidated financial condition of PriCellular and its
Subsidiaries, taken as a whole, as reflected in the financial
statements previously furnished to the Lenders.
(12) Consents, Licenses and Approvals. A certificate
of a responsible officer of Borrower (i) attaching copies of
all consents, authorizations and filings necessary to enter
into and consummate the Transactions and perform the
obligations under the Transaction Documents (including
Hart-Scott-Rodino clearance, if applicable), and (ii) stating
that such consents, licenses and filings are in full force and
effect (or there shall be a plan satisfactory to Arrangers and
the Majority Lenders in their respective sole discretion for
the obtaining thereof) and that all applicable waiting periods
have expired without any action being taken by any competent
authority or threatened which would restrain, prevent or
otherwise impose materially adverse conditions on any Company,
and each such consent, authorization and filing shall be in
form and substance reasonably satisfactory to Arrangers.
(ii) Date of Closing. Such extension of credit shall be made
on or before September 15, 1998.
(iii) Completion of Parent Financing. Borrower shall have
received aggregate gross proceeds of not less than $282.0 million from
the Parent Financing pursuant to the Parent Financing Documents. There
shall have been deposited into the Parent Interest Escrow Account,
pursuant to the terms thereof, cash and/or securities in an amount
sufficient to pay the first six scheduled interest payments on the
Parent Notes as and when due.
(iv) Equity Investment. The Investors shall have purchased
for cash common equity of Parent in an aggregate amount of $25.0
million and the New Preferred (which shall not have any negative
covenants (other than with respect to dividends or distributions on, or
redemptions of, junior stock (as defined in the certificate of
designations with respect to the New Preferred), or redemptions of the
New Preferred) or any requirement for cash dividends or redemption or
repurchase provisions prior to the final stated maturity of the Parent
Notes) in an aggregate amount of $325.0 million, all on terms and
conditions reasonably satisfactory to Arrangers (it being understood
that the terms and conditions set forth in the Stock Purchase Agreement
dated as of March 5, 1998 (as amended by the amendment thereof dated
March 31, 1998) and in the certificate of designations relating to the
New Preferred attached thereto as Exhibit B provided to Arrangers are
satisfactory to Arrangers).
(v) Board Approval; Terms of Merger. The Board of Directors
of Parent, Borrower, PriCellular, and PriCellular Wireless shall have
authorized and approved the Transactions and Arrangers shall have
received reasonably satisfactory evidence of the same. The Merger
Agreement shall not have been amended without Arrangers' consent and
shall be in full force and effect. PriCellular shall not have any
"poison pill" rights or shall have redeemed such rights at a nominal
price, or Arrangers shall otherwise be reasonably satisfied that such
rights are null and void with respect to or inapplicable to the
Mergers.
(vi) Legality. Each of the Transactions and the financing
therefor shall be in compliance with all laws and regulations, or
Arrangers and the Majority Lenders shall have determined such to be
inapplicable to such transactions.
(vii) Consummation of Transactions. The Transactions (other
than the Note Tender) shall have been or shall simultaneously be
consummated in accordance with the terms hereof and the terms of the
Transaction Documents and the other documentation therefor (without the
waiver or amendment of any condition relating to FCC approvals or any
other condition unless consented to by Arrangers and the Majority
Lenders) that are in form and substance reasonably satisfactory to
Arrangers and the Majority Lenders (with any condition therein
requiring the satisfaction of any Person other than Arrangers or the
Lenders being deemed to require the satisfaction of Arrangers and the
Majority Lenders). Parent and PriCellular shall have complied in all
material respects with all covenants set forth in the Merger Agreement
(without waiver or amendment of any of the terms thereof unless
consented to by Arrangers and the Majority Lenders).
(viii) Maximum Merger Price. The consideration per share of
common stock in the PriCellular Merger shall not exceed $14 per share
(excluding appraisal rights) and an aggregate of $820.0 million for all
shares (including appraisal rights).
(ix) Repayment of Existing Credit Facility. All obligations
of PriCellular and its Subsidiaries with respect to the Existing Credit
Facility shall have been paid in full (or provisions made therefor
satisfactory to Arrangers) and all lending commitments thereunder
terminated to the reasonable satisfaction of Arrangers and the Majority
Lenders with all security interests in favor of existing lenders being
unconditionally released.
(x) Note Tender Acceptance; Call for Redemption of Existing
PriCellular Notes; No Other Debt or Preferred Stock. Borrower shall
have accepted for payment all Existing Notes validly tendered in the
Note Tender pursuant to the terms of the Offer to Purchase and Consent
Solicitation dated April 1, 1998 of Parent (and Arrangers shall have
been provided with reasonably satisfactory evidence thereof). To the
extent not converted into common equity of PriCellular prior to the
Mergers, all Existing PriCellular Notes shall have been irrevocably
called for redemption (and Arrangers shall have been provided with
reasonably satisfactory evidence thereof). After giving effect to the
repayment of the Existing Credit Facility, the consummation of the Note
Tender and the redemption (or conversion into equity) of the Existing
PriCellular Notes, Parent and its Subsidiaries shall have outstanding
no Indebtedness or preferred stock (or direct or indirect guarantee or
other credit support in respect thereof) outstanding other than the
Loans, the Parent Notes, the New Preferred and all remaining Existing
Notes not validly tendered in the Note Tender.
(xi) Effectiveness of Supplemental Indentures for Existing
Notes. Article II of each of the Supplemental Indentures dated April
23, 1998 between PriCellular Wireless and Bank of Montreal Trust
Company, as Trustee relating to the Existing Notes other than the
Existing PriCellular Notes (the "Supplemental Indentures"), which
eliminates the negative covenants under the indentures relating to the
Existing Notes, shall have become effective in accordance with the
terms thereof.
(xii) No Material Adverse Change. There shall not have
occurred or become known (i) any Material Adverse Change of Parent or
PriCellular, as the case may be (before and after giving effect to the
Transactions), since December 31, 1997, or (ii) any dividend or
distribution of any kind declared or paid by PriCellular on its Equity
Interests since December 31, 1997.
(xiii) Pro Forma Balance Sheet. The Lenders shall have received
a pro forma consolidated balance sheet of Parent dated as of the date
of the most recently available financial statements of PriCellular
after giving effect to the Transactions, which balance sheet shall be
consistent in all material respects with the sources and uses of funds
and the other conditions contemplated hereby (it being understood that
the estimates of cash on hand and expenses and tender premiums are
subject to change, which may be significant). Each Company shall also
have provided such other financial information as the Lenders or
Arrangers may reasonably request in connection with the Transactions.
(xiv) Approvals. All requisite Governmental Authorities and
third parties shall have approved or consented to the Transactions and
the other transactions contemplated hereby to the extent required, all
applicable appeal periods shall have expired and there shall be no
governmental or judicial action or Proceeding, actual or threatened,
that has had the effect of (or could reasonably be expected to have the
effect of) restraining, preventing or imposing materially burdensome
conditions on any of the Transactions or the other transactions
contemplated hereby, except, in each case, as would not, singly or in
the aggregate, result in a Material Adverse Effect.
(xv) No Default in Other Agreements. Any defaults in any
material agreements of any Company that may result from the
Transactions shall have been resolved or otherwise addressed in a
manner reasonably satisfactory to Arrangers and the Majority Lenders;
and no law or regulation adopted, proposed or applicable after the date
of the Commitment Letter shall be applicable in the reasonable judgment
of Arrangers and the Majority Lenders that restrains, prevents or
imposes materially adverse conditions upon any component of the
Transactions or the financing thereof, including the extensions of
credit under this Agreement.
(xvi) Margin Rule Compliance. All Loans and other financing to
Borrower shall be in full compliance with all applicable requirements
of Regulations T, U and X.
(xvii) Satisfactory Environmental Reports. Arrangers shall have
received reasonably satisfactory third-party environmental reports
(including Phase I reports) of PriCellular and its Subsidiaries
reasonably requested by Arrangers.
(xviii) Other Documentation. All other documentation, including
any employment agreement, management compensation arrangement
(including any agreements entered into with any of the senior
management of any Company) after the Mergers or other financing
arrangement of each Company shall be reasonably satisfactory in form
and substance to Arrangers and the Majority Lenders.
(xix) Payment of Fees and Expenses. All accrued fees and
expenses (including the invoiced and reasonable fees and expenses of
Cahill Gordon & Reindel, special counsel to Arrangers) of Arrangers and
accrued fees of the Lenders in connection with the Credit Documents
shall have been paid.
(xx) Maximum Revolving Credit Loans. The aggregate amount of
Revolving Credit Loans made in connection with the consummation of the
Transactions on the Closing Date shall not exceed $75.0 million unless
consented to by Arrangers in their sole discretion.
(xxi) Annualized Operating Cash Flow of PriCellular.
Annualized Operating Cash Flow of PriCellular and its Consolidated
Subsidiaries shall not be less than $106 million as evidenced in an
Officers' Certificate delivered to Arrangers and the Lenders. For
purposes of the immediately preceding calculation only, Annualized
Operating Cash Flow shall be defined as Operating Cash Flow of
PriCellular and its Consolidated Subsidiaries for April and May 1998
multiplied by six (6).
(xxii) Ordinary Course Operations. Arrangers shall be
reasonably satisfied that, since the date of the Commitment Letter,
PriCellular has operated its business in the ordinary course of
business consistent with past practice, including ordinary course
marketing expenses consistent with past practice.
(xxiii) Filings and Lien Searches. The Obligors shall have
authorized, executed and delivered each of the following:
(1) UCC Financing Statements (Form UCC-1) in
appropriate form for filing under the UCC and any other
applicable law, rule or regulation in each jurisdiction as may
be necessary or appropriate to perfect the Liens created, or
purported to be created, by the Security Documents;
(2) certified copies of Requests for Information
(Form UCC-11), tax lien, judgment lien and pending lawsuit
searches or equivalent reports or lien search reports, each of
a recent date listing all effective financing statements, lien
notices or comparable documents that name any Obligor as
debtor and that are filed in those state and county
jurisdictions in which any of the Collateral of such Obligor
is located and the state and county jurisdictions in which
each such Person's principal place of business is located,
none of which encumber the Collateral covered or intended to
be covered by the Security Agreement other than those
encumbrances which constitute Permitted Liens or Prior Liens;
and
(3) evidence of arrangements for (A) the completion
of all recordings and filings of, or with respect to, the
Security Documents, including, to the extent required by
Arrangers, filings with the United States Patent, Trademark
and Copyright offices, (B) delivery of such other security and
other documents, and (C) the taking of all actions as may be
necessary or, in the opinion of Arrangers, desirable, to
perfect the Liens created, or purported to be created, by the
Security Agreement.
(xxiv) Management Agreements. Arrangers shall be reasonably
satisfied with the terms and conditions of any management agreement
entered into or proposed to be entered into with any Excluded Person or
any of their Affiliates or any other Person.
(xxv) Investment by Providence and Spectrum. Each of the
Providence Group and the Spectrum Group shall have made a cash equity
contribution to Parent of not less than $50.0 million pursuant to the
Equity Financing.
(xxvi) Notice of Borrowing for Deferred Drawdown.
Administrative Agent shall have received a Notice of Borrowing duly
completed and complying with Section 4.05 with respect to Term Loans to
be drawn on the Deferred Drawdown Date in an aggregate amount equal to
the Unutilized Term Loan Commitments.
(xxvii) Other Matters. The Lenders shall have received such other
legal opinions, corporate documents and other instruments and/or
certificates as Arrangers or the Majority Lenders may request in their
reasonable discretion.
7.02. Initial and Subsequent Extensions of Credit. The
obligation of the Lenders to make any Loan or otherwise extend any credit to
Borrower upon the occasion of each borrowing or other extension of credit
(whether by making a Loan or issuing a Letter of Credit but excluding any
Continuation of any LIBOR Loan) hereunder (including the initial borrowing) is
subject to the further conditions precedent that:
(i) No Default; Representations and Warranties True. Both
immediately prior to the making of such Loan or other extension of
credit and also after giving pro forma effect thereto and to the
intended use thereof:
(a) no Default shall have occurred and be
continuing; and
(b) the representations and warranties made by the
Obligors in Section 8, and by each Obligor in each of the
other Credit Documents to which it is a party, shall be true
and complete on and as of the date of the making of such Loan
or other extension of credit with the same force and effect as
if made on and as of such date (or, if any such representation
or warranty is expressly stated to have been made as of a
specific date, as of such specific date).
(ii) No Legal Bar. The Loans and the use of proceeds thereof
shall not contravene, violate or conflict with, nor involve any Lender
in a violation of, any law, rule, injunction, or regulation or
determination of any court of law or other Governmental Authority.
(iii) No Material Adverse Effect. There shall not have
occurred any Material Adverse Effect.
(iv) Notice of Borrowing. Administrative Agent shall have
received a Notice of Borrowing duly completed and complying with
Section 4.05.
Each notice of borrowing or request for the issuance of a
Letter of Credit by Borrower hereunder shall constitute a certification by
Borrower to the effect set forth in clause (i) above as of the date of such
borrowing or issuance.
Each notice submitted by Borrower hereunder for an extension
of credit hereunder shall constitute a representation and warranty by Borrower,
as of the date of such notice and as of the relevant borrowing date or date of
issuance of a Letter of Credit, as applicable, that the applicable conditions in
Sections 7.01 and 7.02 have been satisfied or waived in accordance with the
terms hereof.
7.03. Determinations Under Section 7. For purposes of
determining compliance with the conditions specified in Sections 7.01 and 7.02,
each Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of Administrative Agent responsible for the transactions contemplated by this
Agreement shall have received notice from such Lender prior to the date that
Borrower, by notice to the Lenders, designates as the proposed date of the
extension of credit, specifying its objection thereto.
Section 8. Representations and Warranties. Each Obligor
represents and warrants to the Creditors that at and as of each Funding Date (in
each case immediately before and immediately after giving effect to the
transactions to occur on such date (including the Transactions)):
8.01. Corporate Existence. Each Obligor and each Subsidiary:
(a) is a corporation, partnership or other entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization; (b) has all requisite corporate or other power and authority, and
has all governmental licenses, authorizations, consents and approvals necessary
to own its Property and carry on its business as now being conducted; and (c) is
qualified to do business and is in good standing in all jurisdictions in which
the nature of the business conducted by it makes such qualification necessary
and where failure to be so qualified and in good standing individually or in the
aggregate is reasonably likely to have a Material Adverse Effect.
8.02. Financial Condition; Etc. (a) Parent and Borrower have
heretofore delivered to the Lenders (A) the audited consolidated balance sheets
of PriCellular and its Subsidiaries as of December 31, 1994, December 31, 1995,
December 31, 1996 and December 31, 1997, and the related statements of earnings,
changes in stockholders' equity and cash flows for the fiscal years ended on
those dates, together with reports thereon by Ernst & Young LLP, certified
public accountants, and (B) the unaudited consolidated balance sheets of
PriCellular and its Subsidiaries as of March 31, 1998, and the related
statements of earnings and cash flows for the fiscal periods ended on March 31,
1998. All of said financial statements, including in each case the related
schedules and notes, have been prepared in accordance with GAAP consistently
applied and present fairly the financial position of PriCellular and the
Subsidiaries as of the respective dates of said balance sheets and the results
of their operations for the respective periods covered thereby, subject (in the
case of interim statements) to period-end audit adjustments.
(b) Except as set forth in Schedule 8.02(b) or in the
financial statements or other information referred to in Section 8.02(a), as of
the Closing Date, there are no material liabilities of any Company of any kind,
whether accrued, contingent, absolute, determined, determinable or otherwise,
and there is no existing condition, situation or set of circumstances which is
reasonably likely to result in such a liability, other than:
(i) liabilities disclosed or provided for in the Schedules
hereto, the reports filed by PriCellular with the Commission filed
prior to the date of the Merger Agreement;
(ii) liabilities incurred in the ordinary course of business
consistent with past practice since December 31, 1997, which in the
aggregate are not reasonably likely to have a Material Adverse Effect;
and
(iii) liabilities under this Agreement, the Merger Agreement
or the Parent Financing Documents or liabilities incurred in connection
with the transactions contemplated hereby.
(c) Except as set forth in the filings by PriCellular prior to
the date of the Merger Agreement or as set forth in Schedule 8.02(c), since
December 31, 1997 there has been no Material Adverse Change.
(d) Each of the pro forma balance sheet of Parent and its
Consolidated Subsidiaries and Borrower and its Consolidated Subsidiaries (the
"Pro Forma Balance Sheets"), certified by the chief financial officer of
Borrower, copies of which have been heretofore furnished to each Lender, is the
balance sheet of PriCellular and its Consolidated Subsidiaries as of the date of
the latest available balance sheet of PriCellular prior to the Closing Date (the
"Pro Forma Date"), adjusted to give effect (as if such events had occurred on
such date) to the Transactions to occur on the Closing Date and the application
of the proceeds of all Indebtedness incurred on such date. Each Pro Forma
Balance Sheet, together with the notes thereto, accurately reflects in all
material respects all adjustments necessary to give effect to the Transactions,
was prepared based on good faith assumptions, and presents fairly in all
material respects on a pro forma basis the consolidated financial position of
Parent and its Consolidated Subsidiaries and Borrower and its Consolidated
Subsidiaries as at the Pro Forma Date, adjusted as described above.
8.03. Litigation. Except as set forth in the reports filed by
PriCellular with the Commission prior to the date hereof or in Schedule 8.03,
there is no Proceeding pending against, or to the knowledge of Borrower
threatened in writing against or affecting, any Company or any of its respective
Properties before any Governmental Authority that have a reasonable likelihood
of being adversely determined and that, if determined or resolved adversely to
such Company in accordance with the plaintiff's demands, is reasonably likely to
have a Material Adverse Effect.
8.04. No Breach; No Default. (a) None of the execution,
delivery and performance by each Obligor of any Credit Document or Transaction
Document to which it is a party and the consummation of the transactions herein
and therein contemplated (including the Transactions) will (i) conflict with or
result in a breach of, or require any consent (which has not been obtained and
is in full force and effect) under, any Organic Document of any Company, or any
applicable Requirement of Law or any order, writ, injunction or decree of any
Governmental Authority binding on any Company, or any term or provision of any
Contractual Obligation of any Company, or (ii) constitute (with due notice or
lapse of time or both) a default under any such Contractual Obligation, or (iii)
result in the creation or imposition of any Lien (except for the Liens created
pursuant to the Security Documents) upon any Property of any Company pursuant to
the terms of any such Contractual Obligation, except with respect to each of the
foregoing which is not reasonably likely to have a Material Adverse Effect or
which is not reasonably likely to subject any Agent, Lender or Issuing Lender to
any material risk of damages or liability to third parties.
(b) No Company is in default under or with respect to any
Contractual Obligation (including any Transaction Document) or any order, award
or decree of any Governmental Authority or arbitrator binding upon it or any of
its Property in any respect which is reasonably likely to have a Material
Adverse Effect.
(c) No Default or Event of Default has occurred and is
continuing.
8.05. Action. Each Company has all necessary corporate power,
authority and legal right to execute, deliver and perform its obligations under
each Credit Document and Transaction Document to which it is a party and to
consummate the transactions herein and therein contemplated; the execution,
delivery and performance by each Company of each Credit Document and Transaction
Document to which it is a party and the consummation of the transactions herein
and therein contemplated have been duly authorized by all necessary corporate
action on its part; and this Agreement has been duly and validly executed and
delivered by each Obligor and constitutes, and each of the Notes and the other
Credit Documents to which it is a party when executed and delivered by such
Obligor (in the case of the Notes, for value) will constitute, its legal, valid
and binding obligation, enforceable against each Obligor in accordance with its
terms, except as such enforceability may be limited by (a) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or similar laws of
general applicability from time to time in effect affecting the enforcement of
creditors' rights and remedies and (b) the application of general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).
8.06. Approvals. No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority or any
securities exchange are necessary for the execution, delivery or performance by
any Company of the Credit Documents and the Transaction Documents to which it is
a party or for the legality, validity or enforceability hereof or thereof or for
the consummation of the transactions herein and therein contemplated, except for
filings and recordings in respect of the Liens created pursuant to the Security
Documents and except for consents, authorizations and filings that have been
obtained or made and are in full force and effect or the failure of which to
obtain is not reasonably likely to have a Material Adverse Effect.
8.07. Representations and Warranties in the Merger Agreement.
The representations and warranties set forth in Article III and Article IV of
the Merger Agreement as applicable to PriCellular and Parent, respectively, are,
in each case, true and correct in all material respects as of the time such
representations and warranties were made and shall be true and correct in all
material respects as of the Closing Date as if such representations and
warranties were made on and as of such date, unless such representations and
warranty expressly indicates that it is being made as of any other specific
date.
8.08. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, is reasonably likely to have a
Material Adverse Effect. The present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by more
than $5.0 million the fair market value of the assets of all such underfunded
Plans. Each member of the ERISA Group is in compliance in all material respects
with the presently applicable provisions of ERISA and the Code with respect to
each Plan.
8.09. Taxes. Except as set forth in the PriCellular Balance
Sheet (including the notes thereto) and except as is not reasonably likely to
have a Material Adverse Effect, (i) all tax returns, statements, reports and
forms (including estimated Tax or information returns) (collectively, the "Tax
Returns") required to be filed with any taxing authority by, or with respect to,
each Company and each Unrestricted Subsidiary have been filed in accordance with
all applicable laws; (ii) each Company and each Unrestricted Subsidiary has
timely paid or made provision for payment of all Taxes shown as due and payable
on Tax Returns that have been so filed, and, as of the time of filing, each Tax
Return correctly reflected the facts regarding income, business, assets,
operations, activities and the status of each Company and each Unrestricted
Subsidiary (other than Taxes which are being contested in good faith and for
which adequate reserves are reflected on the PriCellular Balance Sheet or on
other financial statements subsequently delivered hereunder) and (iii) each
Company and each Unrestricted Subsidiary have made provision for all Taxes
payable by such Company and each Unrestricted Subsidiary for which no Tax Return
has yet been filed.
Except as set forth on Schedule 8.09, (i) no extension of a
statute of limitations relating to material Taxes is in effect with respect to
any Company or any Unrestricted Subsidiary; (ii) no Company or any Unrestricted
Subsidiary has ever been a member of an affiliated group of corporations within
the meaning of Section 1504 of the Code other than an affiliated group of
corporations of which Parent was the common parent; and (iii) there are no
material Tax sharing agreements or similar arrangements (including Tax indemnity
arrangements) with respect to or involving any Company or any Unrestricted
Subsidiary except as entered into pursuant to Section 9.09(D).
8.10. Investment Company Act; Public Utility Holding Company
Act; Other Restrictions. No Company is an "investment company", or a company
"controlled" by an "investment company", within the meaning of the United States
Investment Company Act of 1940, as amended. No Company is a "holding company",
or an "affiliate" of a "holding company" or a "subsidiary company" of a "holding
company", within the meaning of the United States Public Utility Holding Company
Act of 1935, as amended. No Obligor is subject to regulation under any law or
regulation which limits its ability to incur Indebtedness, other than Regulation
X of the Board of Governors of the Federal Reserve System.
8.11. Environmental Matters. No Company or any Unrestricted
Subsidiary is in violation of any applicable Environmental Requirement, and no
condition or event has occurred with respect to any Company or any Unrestricted
Subsidiary which, with the giving of notice, lapse of time, or both, would
constitute a violation of or result in liability under any such Environmental
Requirement, excluding in any event such violations, conditions and events that,
individually or in the aggregate, are not reasonably likely to have a Material
Adverse Effect, and no Company or any Unrestricted Subsidiary, nor to Borrower's
knowledge any other Person, has ever generated, manufactured, refined,
transported, treated, stored, handled, disposed, transferred, produced,
processed, discharged or released any Contaminant at, or to Borrower's knowledge
in the vicinity of any real property that has been or is currently owned, leased
or operated by any Company or any Unrestricted Subsidiary, other than any such
acts that do not, or are not reasonably likely to, have a Material Adverse
Effect. To Borrower's knowledge, no other Person has violated any Environmental
Requirement with respect to the business or assets of any Company or any
Unrestricted Subsidiary, excluding any violations that, individually or in the
aggregate, do not, or are not reasonably likely to, have a Material Adverse
Effect.
For purposes of this Section 8.11, "Environmental Requirement"
means any and all applicable federal, state and local statutes, laws, judicial
decisions, regulations, ordinances, rules, judgments, orders, decrees, codes,
injunctions, permits, licenses, agreements and governmental restrictions
relating to the environment or natural resources, the effect of the environment
on human health or to emissions, discharges or releases of pollutants,
contaminants, petroleum or petroleum products, chemicals or industrial, toxic,
radioactive or hazardous substances or wastes into the environment including
without limitation ambient air, indoor air, surface water, groundwater, land or
subsurface strata, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, handling or release
of pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic, radioactive or hazardous substances or wastes or the clean-up
or other remediation thereof; and "Contaminant" means any waste, pollutant,
hazardous or toxic substance or waste, petroleum, petroleum-based substance or
waste, special waste, or any constituent of any such substance or waste, in each
of the foregoing cases as defined in or pursuant to any Environmental
Requirement.
8.12. Environmental Investigations. All material environmental
investigations, studies, audits or assessments which have been conducted and
which are in the possession, custody or control of any Company relating (i) to
the current or prior business, operations, facilities or Property of any Company
or any Unrestricted Subsidiary or any of their respective predecessors in
interest or (ii) to any facility, Property or other asset now or previously
owned, operated, leased or used by any Company or any Unrestricted Subsidiary or
any of their respective predecessors in interest have been made available to
Arrangers and the Lenders.
8.13. Use of Proceeds. No Company is engaged principally, or
as one of its important activities, in the business of extending credit for the
purpose, whether immediate, incidental or ultimate, of buying or carrying Margin
Stock and no part of the proceeds of any extension of credit hereunder will be
used directly or indirectly and whether immediately, incidentally or ultimately
to purchase or carry any Margin Stock or to extend credit to others for such
purpose or to refund Indebtedness originally incurred for such purpose.
Following application of the proceeds of each extension of credit hereunder, not
more than 25 percent of the value of the assets (either of Borrower only or of
Borrower and the Subsidiaries on a consolidated basis) will be Margin Stock.
Borrower will use the proceeds of (i) all Term Loans to finance the
Transactions, and (ii) Revolving Credit Loans to finance the Transactions (in an
amount not to exceed $75.0 million unless consented to by Arrangers in their
sole discretion), pay fees and expenses related thereto, and for general
corporate purposes. If requested by any Lender or Arrangers, Borrower will
furnish to Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form U-1 referred to in
Regulation U.
8.14. Subsidiaries. As of the Closing Date (after giving
effect to the Transactions), neither Parent nor Borrower has any Subsidiaries or
interests in partnerships, joint ventures or business trusts other than the
entities set forth on Schedule 8.14. Parent and Borrower owns, as of the Closing
Date, the percentage of the issued and outstanding Equity Interests or other
evidences of the ownership of each of their respective Subsidiaries,
partnerships or joint ventures listed on Schedule 8.14 as set forth on such
Schedule. No such Subsidiary, partnership or joint venture has issued any
securities convertible into shares of its Equity Interests (or other evidence of
ownership) or any Equity Rights to acquire such shares or securities convertible
into such shares (or other evidence of ownership), and the outstanding stock and
securities (or other evidence of ownership) of such Subsidiaries, partnerships
or joint ventures are owned by Parent and its Subsidiaries free and clear of all
Liens and Equity Rights of others of any kind whatsoever, except for Liens
pursuant to the Security Documents. Parent does not have any direct equity
interest in any Person other than Borrower and any Unrestricted Subsidiary
created or acquired after the Closing Date in accordance with the terms hereof.
8.15. Properties. Except as otherwise contemplated or provided
in the Mortgages, the other Security Documents or this Agreement, and except for
such exceptions that do not, or are not reasonably likely to, have a Material
Adverse Effect, Borrower or a Subsidiary (i) has good and marketable title to
all the Property reflected in the Borrower Balance Sheet or in any later
financial statements provided hereunder as being owned by Borrower or any
Subsidiary (except Property sold or otherwise disposed of since the date thereof
in the ordinary course of business or as otherwise not prohibited by the Credit
Documents), or acquired after the date thereof, free and clear of all Liens,
except (x) Permitted Liens and (y) such imperfections or irregularities of title
or Liens as do not materially affect the use of the Properties subject thereto
or affected thereby or otherwise materially impair business operations at such
Properties and (ii) is the lessee of all leasehold estates and is in possession
of the Properties purported to be leased thereunder, and to the knowledge of
Borrower, each such lease is valid without default thereunder by the lessee or
lessor. Title to all Property of any Company is held by such Company free and
clear of all Liens except for Permitted Liens.
Except for such exceptions that do not, or are not reasonably
likely to have a Material Adverse Effect, the Properties of Borrower and the
Subsidiaries, taken as a whole, are in good operating condition and repair
(ordinary wear and tear excepted), and constitute all of the assets and
properties which are required for the businesses and operations of Borrower and
the Subsidiaries as presently conducted.
8.16. Security Interest; Absence of Financing Statements; Etc.
The Security Documents, once executed and delivered, will create, in favor of
Administrative Agent for the benefit of the Issuing Lender, Lenders and Agents,
as security for the obligations purported to be secured thereby, a valid and
enforceable, and upon filing or recording with the appropriate Governmental
Authorities and delivery of the applicable documents to Administrative Agent,
perfected first priority security interest in and Lien upon all of the
Collateral (and the proceeds thereof), superior to and prior to the rights of
all third persons other than the holders of Permitted Liens.
Except with respect to Permitted Liens and the Liens created
by the Security Documents, there is no currently effective financing statement,
security agreement, chattel mortgage, real estate mortgage or other document
filed or recorded with any filing records, registry, or other public office,
that purports to cover, affect or give notice of any Lien on, or security
interest in, any Property of any Company or rights thereunder or any Equity
Interests of any Unrestricted Subsidiary.
8.17. Licenses and Permits; Compliance with Laws. The
Companies hold all governmental permits, licenses, authorizations, consents and
approvals necessary for the Companies to own, lease, and operate their
respective Properties and to operate their respective businesses as now being
conducted (collectively, the "Permits"), except for Permits the failure of which
to obtain is not reasonably likely to have a Material Adverse Effect. None of
the Permits has been modified in any way that is reasonably likely to have a
Material Adverse Effect. All Permits are in full force and effect except where
the failure to be in full force and effect is not reasonably likely to have a
Material Adverse Effect.
The businesses of the Companies are not being conducted in
violation of any applicable law, statute, ordinance, regulation, judgment,
Permits, order, decree, concession, grant or other authorization of any
governmental entity, except for violations that are not reasonably likely to
have a Material Adverse Effect.
There does not exist any judgment, order or injunction
prohibiting or imposing material adverse conditions upon the Transactions, or
the performance by any Obligor of any of its material obligations under the
Credit Documents.
The Company will promptly make payment on all Existing Notes
validly tendered in the Tender Offer in accordance with applicable law.
8.18. True and Complete Disclosure. The information, reports,
financial statements, exhibits and schedules furnished in writing by or on
behalf of any Obligor to any Creditor in connection with the negotiation,
preparation or delivery of this Agreement and the other Credit Documents or
included herein or therein or delivered pursuant hereto or thereto or pursuant
to the Confidential Information Memorandum dated May 1998 distributed in
connection with the syndication of the Commitments and Loans, including all
filings made with the Commission by PriCellular, PriCellular Wireless or any
Company but in each case excluding all projections, whether prior to or after
the date of this Agreement, when taken as a whole, do not, as of the date such
information was furnished, contain any untrue statement of material fact or omit
to state a material fact necessary in order to make the statements herein or
therein, in light of the circumstances under which they were made, not
materially misleading. The projections and pro forma financial information
furnished at any time by any Obligor to any Creditor pursuant to this Agreement
have been prepared in good faith based on assumptions believed by Borrower to be
reasonable at the time made, it being recognized by the Lenders that such
financial information as it relates to future events is not to be viewed as fact
and that actual results during the period or periods covered by such financial
information may differ from the projected results set forth therein by a
material amount and no Obligor, however, makes any representation as to the
ability of any Company to achieve the results set forth in any such projections.
Borrower understands that all such statements, representations and warranties
shall be deemed to have been relied upon by the Lenders as a material inducement
to make each extension of credit hereunder.
8.19. Solvency; Etc. As of the Closing Date immediately prior
to and immediately following the consummation of the Transactions and the
extensions of credit to occur on such date each Obligor is and will be Solvent
(after giving effect to Section 6.08).
8.20. Contracts. No Company is in default under any material
contract or agreement to which it is a party or by which it is bound, nor, to
Borrower's knowledge, does any condition exist that, with notice or lapse of
time or both, would constitute such default, excluding in any case such defaults
that are not reasonably likely to have a Material Adverse Effect. Schedule 8.20
accurately and completely lists (x) all agreements, if any, among the
stockholders (or any of their Affiliates other than any Company) of Parent on
the one hand and any Company on the other in effect on the date hereof and all
(y) material agreements which are in effect on the date hereof in connection
with the conduct of the business of the Companies.
8.21. Labor Matters. Except as set forth in Schedule 8.21,
there are no strikes or other labor disputes against any Company pending or, to
the knowledge of Borrower, threatened which are reasonably likely to have a
Material Adverse Effect.
8.22. FCC Matters and Governmental Matters. (a) Each Company
holds all licenses, permits and other authorizations issued by the FCC or any
other Communications Regulatory Authority (the "Cellular Licenses") that are
required for the operations and businesses of the Companies as they are now
operated, except that, as of the Closing Date, in the case of certain microwave
operations the FCC has authorized such operations but has not issued a written
microwave authorization, and in the case of certain cell sites, Borrower is
awaiting issuance of a license pursuant to a Form 489 notification. Without
limiting the foregoing, each Company has received all necessary authorizations
from the FAA for all existing towers that are part of the cellular or microwave
systems operated by the Companies and for any facilities the construction of
which have been approved by the FCC or of which applications or notifications
have been filed for such approval.
(b) Schedule 8.22(b) sets forth, as of the Closing Date, the
expiration date for each of the Cellular Licenses held by any Company.
(c) The Cellular Licenses are valid and in full force and
effect, unimpaired by any condition or restriction or any act or omission by any
Company which is reasonably likely to have a Material Adverse Effect. Except as
is not reasonably likely to have a Material Adverse Effect, there are no
modifications, amendments, applications, revocations, or other proceedings, or
complaints pending or, to the knowledge of Borrower, threatened, with respect to
the Cellular Licenses (other than proceedings that apply to the cellular
industry generally). Except as is not reasonably likely to have a Material
Adverse Effect, all fees due and payable to the FCC or any other Communications
Regulatory Authority have been paid and no event has occurred which, with or
without the giving of notice or lapse of time or both, would constitute grounds
for revocation or modification of any Cellular Licenses. Schedule 8.22(c)
identifies all of the Cellular Licenses that are cellular licenses for which the
five-year fill-in period has not yet passed as of the date of this Agreement.
Borrower does not conduct any microwave operations on frequencies that are
subject to relocation under the FCC's rules, except as is not reasonably likely
to result in a Material Adverse Effect.
(d) Except where a lack of compliance is not reasonably likely
to have a Material Adverse Effect, (i) all reports required by the
Communications Act or required to be filed with the FCC or any other
Communications Regulatory Authority by any Company have been filed and are
accurate and complete in all material respects and (ii) all reports required to
be filed by each Company with all other governmental or administrative
authorities, federal, state and local, have been filed and are accurate and
complete in all material respects.
(e) Except where a lack of compliance is not reasonably likely
to have a Material Adverse Effect, each Company is in compliance with, and their
Cellular Systems have been operated in compliance with, the Communications Act
and the rules, regulations, policies and orders of the relevant state public
utilities commissions and the FAA, including, without limitation, the FCC's time
and coverage requirements of 47 C.F.R. ss.ss. 22.142, 22.911, 22.912 and 22.946
(the "Statutes"). Except as is not reasonably likely to result in a Material
Adverse Effect, no Company has received any written notice to the effect, or
otherwise been advised in writing, that they are not in compliance with any
Statutes and do not have any reason to anticipate that any presently existing
circumstances are reasonably likely to result in violations of any Statutes.
(f) No Company has engaged in any course of conduct that is
reasonably likely to impair the ability of any Company to be the holder of the
Cellular Licenses or is aware of any reason why the Cellular Licenses might not
be renewed in the ordinary course, why any of the Cellular Licenses might be
revoked, or why any pending applications or notifications might not be approved.
8.23. Parent Notes. Parent has provided to Arrangers on the
Closing Date true, complete and correct copies of the Parent Financing
Documents. All representations and warranties in the Parent Financing Documents
were true and correct in all material respects on and as of the date made. The
Parent Notes when issued and sold, will either (a) have been registered or
qualified under applicable federal and state securities laws or (b) be exempt
therefrom. The offering documents for the issuance and sale of the Parent Notes
as of their date, did not contain an untrue statement of material fact or omit
to state a material fact required to be stated therein or necessary to make the
statement therein not misleading (it being understood that no representation or
warranty is being made with respect to information in respect of the initial
purchasers thereof expressly provided by them for inclusion therein).
8.24. Year 2000. Each Company has reviewed their operations
with a view to assessing whether their business or operations will, in the
receipt, transmissions, processing, manipulation, storage, retrieval,
retransmission or other utilization of data, be vulnerable to any significant
risk that computer hardware, software or any equipment containing embedded
microchips used in their business or operations will not in the case of dates or
time periods occurring after December 31, 1999 function at least as effectively
as in the case of dates or time periods occurring prior to January 1, 2000. In
addition each Company has obtained assurances from their third party billing
provider and their principal source of cellular equipment that they have
addressed the potential problems of the Year 2000. No Company has reason to
believe that the risks associated with the Year 2000 issue are reasonably likely
to have a Material Adverse Effect.
Section 9. Covenants. Each Obligor, for itself and on behalf
of its Subsidiaries and, to the extent set forth below, its Unrestricted
Subsidiaries, covenants and agrees with the Creditors that, so long as any
Commitment, Loan or Letter of Credit Liability is outstanding and until payment
in full of all amounts payable by Borrower hereunder:
9.01. Financial Statements, Etc. The Companies shall deliver
to Administrative Agent and each of the Lenders:
(a) Quarterly Financials. As soon as available and in any
event within 45 days after the end of each of the first three quarterly
fiscal periods of each fiscal year beginning with the fiscal quarter
ending June 30, 1998, consolidated statements of operations, cash flows
and stockholders' equity of Borrower and its Consolidated Subsidiaries
for such period and for the period from the beginning of the respective
fiscal year to the end of such period, and the related consolidated
balance sheet of Borrower and its Consolidated Subsidiaries as at the
end of such period, setting forth in each case in comparative form (i)
the corresponding consolidated statements of operations, cash flows and
stockholders' equity for the corresponding period in the preceding
fiscal year and (ii) the corresponding budget or plan for such period,
accompanied by a certificate of a Responsible Officer of Borrower,
which certificate shall state that said consolidated financial
statements fairly present the consolidated financial condition, results
of operations and cash flows of Borrower and its Consolidated
Subsidiaries in accordance with GAAP, consistently applied, as at the
end of, and for, such period (subject to normal year-end audit
adjustments);
(b) Annual Financials. As soon as available and in any event
within 90 days after the end of each fiscal year beginning with the
fiscal year ending December 31, 1998, consolidated and consolidating
statements of operations, cash flows and stockholders' equity of
Borrower and its Consolidated Subsidiaries for such year and the
related consolidated and consolidating balance sheet of Borrower and
its Consolidated Subsidiaries as at the end of such year, setting forth
in each case in comparative form (i) the corresponding consolidated and
consolidating information as of the end of and for the preceding fiscal
year and (ii) the corresponding budget or plan for such period, and
accompanied by an opinion, without a going concern or similar
qualification or exception as to scope, thereon of Ernst & Young LLP or
other independent certified public accountants of recognized national
standing reasonably acceptable to Arrangers, which opinion shall state
that said consolidated and consolidating financial statements fairly
present the consolidated and consolidating financial condition, results
of operations and cash flows of Borrower and its Consolidated
Subsidiaries as at the end of, and for, such fiscal year in accordance
with GAAP, consistently applied; Borrower shall supply such additional
information and detail as to any item or items contained on any such
statement that Lenders may reasonably require; all such information
will be prepared in accordance with GAAP consistently applied;
(c) Compliance Certificate; Performance Certificate.
(i) concurrently with the delivery of the financial
statements referred to in Section 9.01(b), a certificate of
the independent certified public accountants reporting on such
financial statements stating that in making the examination
necessary therefor no knowledge was obtained of any Event of
Default relating to the Financial Maintenance Covenants,
except as specified in such certificate;
(ii) at the time it furnishes each set of financial
statements pursuant to paragraph (a) or (b) above, (1) a
certificate of a senior financial officer of Parent and
Borrower (I) to the effect that no Default has occurred and is
continuing (or, if any Default has occurred and is continuing,
describing the same in reasonable detail and describing the
action that Borrower has taken and proposes to take with
respect thereto), (II) specifying whether or not any
Unrestricted Subsidiary has been created or acquired since the
last such certificate and (III) setting forth in reasonable
detail the computations necessary to determine whether each
Company is in compliance with Sections 9.07, 9.08, 9.09, 9.10
and 9.11 as of the end of the respective quarterly fiscal
period or fiscal year, (2) to the extent not previously
disclosed to Administrative Agent, a listing of any state
within the United States where any Obligor keeps inventory or
equipment and of any material licenses arising under the laws
of the United States (or any jurisdiction therein) acquired by
any Obligor since the date of the most recent list delivered
pursuant to this clause (II) (or, in the case of the first
such list so delivered, since the Closing Date), and (3) any
final accountants' management letters delivered by the
independent certified public accountants reporting on such
financial statements to Borrower or any Subsidiary; and
(iii) at the time the financial statements are
furnished pursuant to Sections 9.01(a) and (b), an Officers'
Certificate, setting forth the Specified Cellular System
Information for the most recent fiscal period covered by such
financial statements;
(d) Other Financial Information. Promptly upon delivery
thereof to the holders of any debt securities or the stockholders of
any Company generally, copies of all financial statements and reports
and proxy statements so delivered, and at the time the same are filed,
copies of all financial statements and reports which any Company may
make to or file with the Commission or any successor or analogous
Governmental Authority;
(e) Interest Rate Certificates. Together with the financial
statements delivered pursuant to clause (a) or (b) of this Section
9.01, an Interest Rate Certificate;
(f) Notice of Default. Promptly after any Company knows or has
reason to believe that any Default has occurred or that any Company is
in default of any material term or provision of the Parent Financing
Documents or any other agreement or instrument relating to or
evidencing material Indebtedness, a notice of such Default describing
the same in reasonable detail and, together with such notice or as soon
thereafter as possible, a description of the action that the Companies
have taken and propose to take with respect thereto;
(g) Environmental Matters. Written notice of any Environmental
Claim materially affecting any Company or any Unrestricted Subsidiary,
any Mortgaged Real Property or the operations of any Company, and any
notice from any Person of (i) the occurrence of any release, spill or
discharge of any Hazardous Material that is reportable under any
Environmental Law, (ii) the commencement of any clean-up pursuant to or
in accordance with any Environmental Law of any Hazardous Material at,
on, under or within the Mortgaged Real Property or any part thereof,
(iii) any matters relating to Hazardous Materials or Environmental Laws
that may impair, or threaten to impair, Lenders' security interest in
the Mortgaged Real Property or any Obligor's ability to perform any of
its obligations under this Agreement when such performance is due or
(iv) any other condition, circumstance, occurrence or event which is
reasonably likely to have a Material Adverse Effect;
(h) Auditors' Reports. Promptly upon receipt thereof, copies
of all reports submitted to any Company by independent certified public
accountants in connection with each annual, interim or special audit of
such Company's books made by such accountants, including, without
limitation, any management letter commenting on any Company's internal
controls submitted by such accountants to management in connection with
their annual audit;
(i) Annual Budgets. As soon as practicable and in any event
within 60 days after the beginning of each fiscal year of Borrower
beginning with fiscal year 1999, a consolidated plan and financial
forecast for such fiscal year, including without limitation (a) a
forecasted consolidated balance sheet and forecasted consolidated
statements of income and cash flows of Borrower and the Subsidiaries
for such fiscal year, together with an Officers' Certificate
demonstrating pro forma compliance for such fiscal year with Section
9.11 and an explanation of the assumptions on which such forecasts are
based and (b) forecasted consolidated statements of income and cash
flows of Borrower and the Subsidiaries for each month of each such
fiscal year, together with an explanation of the assumptions on which
such forecasts are based;
(j) Lien Matters. Written notice of (1) the incurrence of any
Lien (other than Permitted Liens, Prior Liens and other Liens expressly
permitted by the terms of the applicable Security Document) on, or
claim asserted against any of the Collateral or (2) the occurrence of
any other event which is reasonably likely to adversely affect the
aggregate value of the Collateral;
(k) Notice of Material Adverse Effect. Written notice of the
occurrence of any Material Adverse Effect or any event or condition
which is reasonably likely to result in any Material Adverse Effect;
(l) Governmental Filings and Notices. Promptly after request
by Administrative Agent, copies of any other reports or documents that
were filed by any Company with any Governmental Agency including, but
not limited to, the FCC and copies of any and all material notices and
other material communications from any Federal, state or local
Governmental Authority with respect to any Company;
(m) ERISA Information. Written notice of the occurrence of any
ERISA Event that, alone or together with any other ERISA Events that
have occurred, is reasonably likely to result in liability to the
Companies in an aggregate amount exceeding $5.0 million;
(n) FCC Notices; Notice of Certain Information Regarding
Permitted Acquisitions. Promptly upon (1) receipt thereof, copies of
any material adverse notice or reports regarding any Company from the
FCC or any other Communications Regulatory Authority, (2) receipt of
notice of (A) any forfeiture, non-renewal, cancellation, termination,
revocation, suspension, impairment or material adverse modification of
any material Cellular License held by any Company, or any notice of
default or forfeiture with respect to any such Cellular License, or (B)
any refusal by any Communications Regulatory Authority to renew or
extend any material license, permit, certification or other
authorization (including any Cellular License) held by any Company, an
Officers' Certificate specifying the nature of such event, the period
of existence thereof, and what action the Companies are taking and
propose to take with respect thereto, and (3) the consummation of any
Permitted Acquisition, a written notice setting forth with respect to
the business acquired, all of the data required to be set forth in
Schedule 8.22(b) or Schedule 8.22(c) with respect to such business and
the Cellular Licenses and any other licenses, permits, certifications
and other authorizations from any other Communications Regulatory
Authority required in connection with the operation of such business
(as if the date of consummation of such Permitted Acquisition were the
Closing Date); and
(o) Miscellaneous. Promptly, such financial and other
information with respect to any Company or Unrestricted Subsidiary as
any Creditor may from time to time reasonably request that is readily
available to the Companies.
9.02. Litigation, Etc. Borrower shall promptly give to
Administrative Agent and each Lender notice of all Proceedings, and (except to
the extent that any such notice would, in the reasonable opinion of outside
counsel to Borrower, waive attorney client privilege) any material development
thereof, affecting any Company, except Proceedings which are not reasonably
likely to have a Material Adverse Effect.
9.03. Existence; Compliance with Law; Payment of Taxes;
Inspection Rights; Performance of Obligations; Etc. Each Company shall (i)
preserve and maintain its legal existence and all of its material rights,
privileges and franchises; provided, however, that nothing in this Section 9.03
shall prohibit any transaction expressly permitted under Section 9.06, (ii)
except as is not reasonably likely to have a Material Adverse Effect, comply
with the requirements of all applicable laws, rules, regulations and orders of
Governmental Authorities, (iii) except as is not reasonably likely to have a
Material Adverse Effect, timely file true, accurate and complete tax returns
required by all Governmental Authorities and pay and discharge all material
Taxes, assessments and governmental charges or levies imposed on it or on its
income or profits or on any of its Property prior to the date on which any
material penalties attach thereto (except for any such Tax, assessment, charge
or levy the payment of which is being contested in good faith and by proper
proceedings and against which adequate reserves are being maintained in
accordance with GAAP); (iv) maintain all of its Properties used or useful in its
business in good working order and condition, ordinary wear and tear excepted,
except to the extent that the failure to do so with respect to any such Property
is not reasonably likely to have a Material Adverse Effect; (v) permit
representatives of any Creditor during normal business hours and, except during
the existence of an Event of Default, upon reasonable prior notice, to examine,
copy and make extracts from its books and records, to inspect its Properties,
and to discuss its business and affairs with its officers and employees, all to
the extent reasonably requested by such Creditor; (vi) upon reasonable notice,
allow, with the presence of Borrower if Borrower so elects to participate,
either Arranger to consult with Borrower's independent public accountants and
auditors with respect to the financial affairs of the Companies and authorize
such accountants to disclose to either Arranger and the Lenders (and Arrangers
to the Creditors) any and all financial statements and other supporting
financial documents and schedules including copies of any management letter with
respect to the business, financial condition and other affairs of the Companies;
at the request of either Arranger, Borrower shall deliver a letter addressed to
such accountants instructing them to comply with the provisions of this Section
9.03(vi); (vii) perform in all material respects all of its Contractual
Obligations, except where such failure to so perform, singly or in the aggregate
with all other such failures, is not reasonably likely to have a Material
Adverse Effect; and (viii) keep proper books of record and accounts, in which
full and correct entries shall be made of all financial transactions and the
Property and business of each Company in accordance with GAAP in effect from
time to time or as otherwise required by applicable rules and regulations of any
Governmental Authority having jurisdiction over such Company. Parent and
Borrower shall cause the Mergers to be consummated on the Closing Date in
accordance in all material respects with the terms of this Agreement and (in the
case of the PriCellular Merger) the Merger Agreement.
9.04. Insurance. (A) Each Company shall maintain, with
financially sound and reputable insurers, insurance of the kinds and in the
amounts customarily insured against by companies engaged in the same or similar
business and similarly situated (including business interruption insurance).
Each Company shall pay all insurance premiums payable by it as and when due.
(B) All policies of insurance required to be maintained by any
Company must name Administrative Agent on behalf of Issuing Lender, Lenders and
Agents as mortgagees (in the case of property insurance) or additional insured
(in the case of liability insurance), as applicable, or certificate holder (in
the case of workers' compensation insurance) and must provide that no
cancellation, non-renewal or modification (including reduced coverage) of the
policies will be made without thirty days' prior written notice to
Administrative Agent and if the insurance carrier shall have received written
notice from Administrative Agent of the occurrence and continuance of an Event
of Default, the insurance carrier shall pay all proceeds otherwise payable to
any Company under such policies directly to Administrative Agent.
(C) The Obligors shall give immediate written notice of any
loss in excess of $5.0 million to the insurance carrier and to Administrative
Agent.
(D) If at any time the area in which any Mortgaged Real
Property is located is designated (i) a "flood hazard area" in any Flood
Insurance Rate Map published by the Federal Emergency Management Agency (or any
successor agency), Borrower shall obtain flood insurance in such total amount as
Administrative Agent or the Majority Lenders may from time to time require, and
otherwise comply with the National Flood Insurance Program as set forth in the
Flood Disaster Protection Act of 1973, as amended from time to time, or (ii) a
"Zone 1" area, Borrower shall obtain earthquake insurance in such total amount
as Administrative Agent or the Majority Lenders may require; provided, however,
that Borrower shall not, unless required by applicable law pertaining to
Borrower or any Creditor, be required to obtain any insurance described in this
Section 9.04(D) if not available at commercially reasonable rates.
9.05. Limitation on Lines of Business; Limitation on Activity
of License Subsidiaries; Limitation on Management Agreements No Company or
Unrestricted Subsidiary shall directly or indirectly, engage to any material
extent in any line or lines of business activity other than the business of the
type conducted by Borrower and the Subsidiaries as of the Closing Date (after
giving effect to the Mergers) or any business related, ancillary or
complementary thereto. No License Subsidiary shall engage in any business or
incur any liabilities other than the ownership of its Cellular Licenses and the
execution, delivery and performance of the Credit Documents to which it is a
party and activities incidental to the foregoing. No Company shall, directly or
indirectly, turn over the management of its properties, assets, rights, licenses
and franchises to any Person other than a full-time employee of the Companies or
enter into any management or similar agreement with any Person other than with
any one or more Excluded Persons so long as the terms and conditions thereof are
reasonably satisfactory to Arrangers.
9.06. Limitation on Fundamental Changes, Acquisitions or
Dispositions. No Company shall, directly or indirectly, in a single transaction
or series of transactions, (1) merge, consolidate or amalgamate with or into any
Person (other than pursuant to the Mergers on the Closing Date), or liquidate,
wind up or dissolve itself (or suffer any liquidation or dissolution), (2)
effect any Acquisition, or (3) effect any Disposition (or agree to do any of the
foregoing). Notwithstanding the foregoing provisions of this Section 9.06, each
of the following shall be permitted if and to the extent complying with the
Parent Financing Documents (and any Permitted Refinancing thereof) as from time
to time in effect (if then in effect):
(a) purchases and sales of Property in the ordinary course of
business;
(b) the pledge of the Collateral pursuant to the Security
Documents and the incurrence of any Permitted Lien;
(c) the merger, consolidation, dissolution or liquidation of
(1) any Subsidiary with or into (i) Borrower if Borrower shall be the
continuing or surviving corporation or (ii) any Wholly Owned Guarantor
if a Wholly Owned Guarantor shall be the continuing or surviving
corporation, and (2) any Subsidiary which is not a Wholly Owned
Guarantor with or into any other Subsidiary which is not a Wholly Owned
Guarantor;
(d) Dispositions by Parent or any Subsidiary to Borrower or to
any Qualified Subsidiary and by Borrower to any Qualified Subsidiary;
provided, however, that no Company shall directly or indirectly
transfer, sell, assign, pledge or otherwise effect any Disposition of
all or a substantial part of the assets of Borrower and the
Subsidiaries to any one or more Subsidiaries that is not a Wholly Owned
Guarantor;
(e) Dispositions of used, worn out, obsolete or surplus
Property by any Company in the ordinary course of business; provided,
however, that the proceeds thereof shall be reinvested in the business
of Borrower or any Subsidiary within one year of such Disposition;
(f) sale or discount, in each case without recourse, of
accounts receivable past due arising in the ordinary course of
business, but only in connection with the compromise or collection
thereof; provided, however, that in no event may any Company enter into
any factoring or securitization program with respect to receivables;
(g) Borrower or any Subsidiary may effect any Disposition for
fair market value resulting in gross proceeds not to exceed $25.0
million in the aggregate in any fiscal year of Borrower and $100.0
million since the Closing Date; provided, however, that (1) the Net
Available Proceeds therefrom are applied as specified in Section
2.10(a)(iv), and (2) such annual and overall amounts shall be net of
all cash received for Dispositions pursuant to Section 9.06(o) in
reliance on subclause (B) of clause (1) of the proviso thereto;
(h) Acquisitions by Borrower or any Qualified Subsidiary of
any Allowable Cellular System(s) (including any Acquisition of any
Allowable Cellular System(s) effected through a swap transaction of any
of Borrower's or any Subsidiary's Cellular System(s) for any Allowable
Cellular System(s) (or any Allowable Cellular System(s) together with
any business any Company may engage in pursuant to Section 9.05 which
business operates with such Allowable Cellular System(s) so acquired)
of another Cellular System operator); provided, however, that each
Acquisition under this Section 9.06(h) shall satisfy each of the
following conditions:
(i) no Default then exists or would result therefrom;
(ii) after giving pro forma effect in accordance with
GAAP to such Acquisition, (1) Borrower shall be in compliance
with all covenants set forth in Section 9.11 as of the Test
Date immediately prior to the consummation thereof (assuming,
for purposes of Section 9.11, that such Acquisition, and all
other Permitted Acquisitions consummated since the first day
of the relevant measurement period for each financial covenant
set forth in Section 9.11 ending on or prior to the date of
such Acquisition, had occurred on the first day of such
relevant measurement period), and (2) as reasonably determined
in good faith by Borrower, Borrower and the Subsidiaries can
reasonably be expected to remain in compliance with such
covenants through the Final Maturity Date and to have
sufficient cash liquidity to conduct their respective business
and pay their respective debts and other liabilities as they
come due;
(iii) no Company shall, in connection with any such
Acquisition, assume or remain liable with respect to any
Indebtedness or other liability (including any material tax or
ERISA liability) of the related seller, except (1) to the
extent permitted under Section 9.08, and (2) obligations of
the seller or acquired Person or business incurred in the
ordinary course of business and necessary or desirable to the
continued operation of the underlying properties, and any
other such liabilities or obligations not permitted to be
assumed or otherwise supported by any of the Companies
hereunder shall be paid in full or released as to the assets
being so acquired on or before the consummation of such
Acquisition;
(iv) the Properties acquired in connection with any
such Acquisition shall be free and clear of any Liens, other
than Permitted Liens;
(v) the board of directors of the acquired Person
shall not have indicated privately to any Company or publicly
its opposition to the consummation of such Acquisition;
(vi) such Acquisition shall be effected through
Borrower or a Qualified Subsidiary and the Person or business
acquired shall at the time of consummation of such Acquisition
be merged or combined or consolidated with or into a Qualified
Subsidiary or shall be at the time of consummation thereof a
Qualified Subsidiary;
(vii) with respect to any Acquisition involving
Acquisition Consideration of more than $25.0 million, Borrower
shall have provided not fewer than 30 days prior to the
proposed closing thereof Arrangers and the Lenders with (1)
written notice thereof and a brief description of the material
terms thereof and a brief description of the business or
Person to be acquired, (2) historical financial statements for
the last three fiscal years (or, if less, for the period of
such Person's existence) of the Person or business to be
acquired (audited if available without undue cost or delay)
and unaudited financial statements thereof for the most recent
interim period which are available, (3) reasonably detailed
projections for the succeeding five years (or, if earlier,
through the year in which the Final Maturity Date occurs)
pertaining to the Person or business to be acquired, (4)
copies of all material documentation pertaining to such
Acquisition, and (5) all such other information and data
relating to such Acquisition or the Person or business to be
acquired as may be reasonably requested by Arrangers or the
Majority Lenders;
(viii) Borrower shall have delivered to Arrangers and the
Lenders (x) an Officers' Certificate at least 10 days prior to
the date of consummation of such Acquisition (but in any event
not earlier than a date which would result in the Test Date
occurring on or immediately prior to the consummation of such
Acquisition being more than 135 days prior to the date of
consummation of such Acquisition) certifying that (1) such
Acquisition complies with this Section 9.06(h) (which shall
have attached thereto reasonably detailed backup data and
calculations showing such compliance), and (2) such
Acquisition is not reasonably likely to have a Material
Adverse Effect and (y) financial statements referred to in
clause (vii) of this Section 9.06(h) for the most recently
ended fiscal period if the latest financial statements
previously delivered pursuant to clause (vii) cover a period
ending more than 135 days before the date of consummation of
such Acquisition;
(ix) prior to the completion of any Permitted
Acquisition, Borrower shall, and shall cause its Subsidiaries
to, obtain all approvals and consents of all Governmental
Authorities and all consents of other Persons (including
without limitation the FCC), in each case that are necessary
or advisable in connection with the transfer of any Cellular
Licenses and the continued operation of the Cellular System or
business being acquired in substantially the manner proposed
to be conducted following to the consummation of such
Permitted Acquisition; and
(x) contemporaneously with or as soon as practicable
after the completion of a Permitted Acquisition, Borrower
shall, and shall cause its Subsidiaries to, transfer to a
License Subsidiary any Cellular Licenses acquired in
connection with the Permitted Acquisition; provided, however,
that Borrower need not, and need not cause its Subsidiaries
to, transfer to License Subsidiaries such Cellular Licenses to
the extent such a transfer is not permitted by applicable law
(other than as a result of any Company failing to take all
necessary action to permit such transfer);
(i) Acquisitions by Borrower or any Qualified Subsidiary of
any Cellular System(s) (including any Acquisition of any Cellular
System(s) effected through a swap transaction of any of Borrower's or
any Subsidiary's Cellular System(s) for any Cellular System(s) (or any
Cellular System(s) together with any business any Company may engage in
pursuant to Section 9.05 which business operates with such Cellular
System(s) so acquired) of another Cellular System operator); provided,
however, that (1) each such Acquisition under this Section 9.06(i)
shall satisfy each of the conditions set forth in clauses (i) through
(x) of Section 9.06(h) (with references therein to Section 9.06(h)
being deemed references to this Section 9.06(i)), and (2) other than
any Qualifying Acquisition, the Acquisition Consideration for such
Acquisition shall not exceed $50.0 million, and the Acquisition
Consideration for such Acquisition, together with the aggregate amount
of the Acquisition Consideration for all Acquisitions (other than
Qualifying Acquisitions) effected pursuant to this Section 9.06(i)
since the Closing Date, shall not exceed $100.0 million; provided,
further, however, that such limitations on the aggregate amount of
Acquisition Consideration may be increased by written consent of the
Majority Lenders obtained not fewer than five Business Days prior to
the consummation of such Acquisition;
(j) transfers resulting from any casualty or condemnation
of Property;
(k) licenses or sublicenses by any Company of software,
trademarks and other intellectual property and general intangible and
leases, licenses or subleases of other property in the ordinary course
of business and which do not materially interfere with the business of
any Company;
(l) any consignment arrangements or similar arrangements for
the sale of assets in the ordinary course of business of any Company;
(m) the making of Investments permitted by Section 9.09 and
the liquidation in the ordinary course of business of (A) Permitted
Investments and (B) Investments made pursuant to Sections 9.09(A)(a)
and 9.09(A)(b);
(n) any Company may effect the Disposition for fair market
value in cash of the partnership interests held by any Company in the
Laredo Joint Venture pursuant to the terms of the Laredo JV Agreement
so long as the Net Available Proceeds therefrom are applied as
specified in Section 2.10(a)(iv);
(o) Dispositions of any Cellular System(s) of Borrower or any
Subsidiary for fair market value through any swap transaction (which
may consist of one or a series of related transactions) consummated to
effect a Permitted Acquisition (including those involving the receipt
of cash by Borrower or any Subsidiary); provided, however, that (1) the
aggregate amount of cash received in connection with any such
Disposition shall not exceed the sum of (A) 10% of the total
consideration received by Borrower and the Subsidiaries in such
Disposition, plus (B) the Swap Excess Cash Basket, and (2) the Net
Available Proceeds therefrom are applied as specified in Section
2.10(a)(iv);
(p) Acquisitions not otherwise permitted hereunder by Borrower
or any Subsidiary of any new Subsidiary; provided, however, that (1)
the sole consideration provided therefor by the Companies is common
Equity Interests of Parent, and (2) such Acquisition shall comply with
each of clauses (i), (ii), (iii), (iv), (v), (vii), (viii), (ix), and
(x) of Section 9.06(h) (with references therein to Section 9.06(h)
being deemed references to this Section 9.06(p));
(q) any Disposition of Property acquired in a Permitted
Acquisition; provided, however, that (i) no Event of Default then
exists or would arise therefrom, (ii) Borrower shall have delivered to
Arrangers and the Lenders, within 30 days after such Permitted
Acquisition but in any event not later than 15 days prior to the
proposed date of Disposition, an Officers' Certificate identifying and
describing in reasonable detail such Property and certifying that such
Property constitutes redundant, unnecessary or undesirable Property,
(iii) each Arranger and the Majority Lenders shall have approved of
such Dispositions (it being understood that an Arranger or a Lender's
failure to object within 10 days of receiving such certificate shall be
deemed to constitute approval by such Arranger or Lender), (iv) after
giving pro forma effect in accordance with GAAP to such Disposition,
(1) Borrower shall be in compliance with all covenants set forth in
Section 9.11 as of the Test Date immediately prior to the proposed date
of consummation of such Disposition (assuming, for purposes of Section
9.11, that such Disposition, and all other Dispositions effected
pursuant to this Section 9.06(q) consummated since the first day of the
relevant measurements period for each financial covenant set forth in
Section 9.11 ending on or prior to the date of such Disposition, had
occurred on the first day of such relevant measurement period) and (2)
as reasonably determined in good faith by Borrower, Borrower and the
Subsidiaries can reasonably be expected to remain in compliance with
such covenants through the Final Maturity Date and to have sufficient
cash liquidity to conduct their respective business and pay their
respective debts and other liabilities as they come due, (v) Borrower
shall have delivered to Arrangers and the Lenders an Officers'
Certificate at least 10 days prior to the date of consummation of such
Disposition (but in any event not earlier than a date which would
result in the Test Date occurring on or immediately prior to the
consummation of such Disposition being more than 135 days prior to the
date of consummation of such Disposition) certifying that (1) such
Disposition complies with this Section 9.06(q) (which shall have
attached thereto reasonably detailed backup data and calculations
showing such compliance), and (2) such Disposition is not reasonably
likely to have a Material Adverse Effect, and (vi) the proceeds thereof
shall be applied either (I) to the repayment of the Revolving Credit
Loans (to the extent thereof) within one Business Day of receipt
thereof (it being understood that such application shall not require a
corresponding reduction in the Revolving Credit Commitments) or (II) as
set forth in Section 2.10(a)(iv); and
(r) Acquisitions not otherwise permitted hereby of a business
directly related or directly complementary to a business of Borrower
and its Subsidiaries on the Closing Date (but excluding any
non-cellular wireless business) so long as the aggregate Acquisition
Consideration for all Acquisitions consummated pursuant to this Section
9.06 (r) since the Closing Date does not exceed $10.0 million.
To the extent the Majority Lenders waive the provisions of this Section 9.06
with respect to the sale or other disposition of any Collateral, or any
Collateral is sold or otherwise disposed of as permitted by this Section 9.06
(other than to any Company), such Collateral in each case shall be sold or
otherwise disposed of free and clear of the Liens created by the Security
Documents and Administrative Agent shall take such actions as are appropriate in
connection therewith.
9.07. Limitation on Liens and Negative Pledges. Parent shall
not, and Parent shall not cause or permit any Unrestricted Subsidiary to,
directly or indirectly, create, incur, assume or suffer to exist any Lien upon
or with respect to any Equity Interest of any Unrestricted Subsidiary other than
pursuant to the Security Documents and other than any second priority Lien on
any Equity Interests of any Unrestricted Subsidiary that is not a direct
Subsidiary of any Company so long as the terms thereof are satisfactory to
Arrangers and the holder of such Lien shall have no voting rights whatsoever and
shall have entered into an intercreditor agreement in form and substance
satisfactory to Arrangers in their sole discretion. No Company shall, directly
or indirectly, create, incur, assume or suffer to exist any Lien upon or with
respect to any of their respective Property, whether now owned or hereafter
acquired, except, with respect to Collateral, for Liens expressly permitted by
the applicable Security Document and except for the following (so long as
complying with the Parent Financing Documents (and any Permitted Refinancing
thereof) from time to time in effect (if then in effect)), which are herein
collectively referred to as "Permitted Liens":
(a) Liens in existence on the Closing Date and identified in
Schedule 9.07 (excluding, however, following the making of the initial
Loans hereunder, Liens securing any Existing Debt or the Existing
Credit Facility);
(b) Liens imposed by any Governmental Authority for taxes,
assessments or charges not yet due or which are being contested in good
faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of the Companies, in accordance
with GAAP;
(c) Liens imposed by law which were incurred in the ordinary
course of business, such as carriers', warehousemen's, landlords' and
mechanics' Liens and other similar Liens arising in the ordinary course
of business, in each case for sums the payment of which is not required
by Section 9.03;
(d) pledges or deposits under workers' compensation,
unemployment insurance and other social security legislation or the
deposits securing the liability to insurance carriers;
(e) pledges or deposits to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
(f) easements, rights-of-way, restrictions or minor defects or
irregularities in title incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of Real Property or minor imperfections in
title thereto which, in the aggregate, are not material in amount, and
which do not in any case materially detract from the value of the Real
Property subject thereto or interfere with the ordinary conduct of the
business of any Company;
(g) Liens upon tangible personal Property acquired after the
Closing Date by Borrower or any Subsidiary, each of which Liens either
(A) existed on such Property before the time of its acquisition and was
not created in anticipation thereof, or (B) was created solely for the
purpose of securing Indebtedness representing, or incurred to finance
or refinance, the cost of such Property or improvements thereon;
provided, however, that (1) no such Lien shall extend to or cover any
Property of any Company other than the Property so acquired and
improvements thereon and proceeds thereof, and (2) the principal amount
of Indebtedness secured by any such Lien shall at no time exceed 100%
of the fair market value of such Property at the time it was acquired;
(h) Liens existing on any Property of any Person at the time
such Property is acquired or such Person becomes a Subsidiary or is
merged or consolidated with or into a Subsidiary and, in each case, not
created in contemplation of or in connection with such event; provided,
however, that such Liens do not extend to any other Property of any
Company;
(i) Liens not otherwise permitted hereunder securing
obligations of any Company at any time not exceeding in the aggregate
$5.0 million;
(j) Liens securing obligations under Swap Contracts with any
Lender or any Affiliate of a Lender to the extent such Swap Contract
relates to the Loans and only so long as the Obligations are secured by
the same collateral on at least a pari passu basis;
(k) Liens consisting of judgment or judicial attachment Liens
(including prejudgment attachment) in existence less than 45 days after
the entry thereof or the enforcement of which is effectively stayed or
payment of which is covered in full (subject to a customary deductible)
by insurance or which do not otherwise result in an Event of Default
under Section 10(h);
(l) Liens securing obligations in respect of Capital Leases
solely on Property subject to such Capital Leases;
(m) any obligations or duties affecting any of the Property of
any Company to any municipality or public authority with respect to any
franchise, grant, license or permit which do not materially impair the
use of such Property for the purposes for which it is held and
restrictions on the transfer of assets imposed by the FCC or the
Communications Act in effect generally on all Persons subject thereto;
(n) leases or subleases granted to third Persons not
interfering in any material respect with the business of any Company;
(o) Liens arising from UCC financing statements regarding
leases permitted by this Agreement;
(p) any interest or title of a lessor or sublessor under any
lease permitted by this Agreement;
(q) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of custom duties in connection
with the importation of goods so long as such Liens attach only to the
imported goods;
(r) Liens arising out of consignment or similar arrangements
for the sale of goods entered into by any Company in the ordinary
course of business;
(s) Liens created under this Agreement and/or the other Credit
Documents;
(t) call rights pursuant to section 9.3 of the Laredo JV
Agreement in favor of the partners thereto with respect to Parent's or
any of its Affiliates' partnership interests in the Laredo Joint
Venture;
(u) Liens granted pursuant to the Parent Interest Escrow
Agreement securing the Parent Notes as such Parent Interest Escrow
Agreement is in effect on the Closing Date and solely with respect to
the Property contemplated thereby on the Closing Date; and
(v) any extension, renewal or replacement of the foregoing;
provided, however, that the Liens permitted by this Section 9.07(v)
shall not cover any additional principal amount of Indebtedness or
Property (other than like Property substituted for Property covered by
such Lien).
Except with respect to (i) specific Property encumbered
pursuant to a Lien permitted to be incurred pursuant to this Section 9.07 or
(ii) specific Property to be sold pursuant to an executed agreement with respect
to a Disposition consummated in accordance with this Agreement, no Company will
directly or indirectly, enter into any agreement on or after the Closing Date
prohibiting or restricting in any manner (directly or indirectly and including
by way of covenant, representation or warranty or event of default) the creation
or assumption of any Lien upon its Property, whether now owned or hereafter
acquired, except pursuant to the Credit Documents and the Parent Financing
Documents and any Permitted Refinancing thereof (so long as such Permitted
Refinancing is not more restrictive in such regard than the Parent Financing
Documents as in effect on the Closing Date) and except for the provisions of the
Laredo JV Agreement as in effect on the date hereof prohibiting the creation of
Liens on the partnership interest therein held by the Companies.
9.08. Prohibition on Disqualified Capital Stock; Limitation on
Indebtedness and Contingent Obligations. No Company shall directly or indirectly
issue or permit to be outstanding any Disqualified Capital Stock, other than
Disqualified Capital Stock issued to and held by Parent, Borrower or any
Qualified Subsidiary. No Company will incur any Indebtedness or Contingent
Obligation (other than the Loans) which contains any direct or indirect default,
prepayment event, redemption event, repurchase or mandatory offer to purchase
event upon the occurrence or failure to occur of any event or circumstance
relating to any Unrestricted Subsidiary. No Company shall, directly or
indirectly, incur any Indebtedness or any Contingent Obligation, except (each of
which shall be given independent effect) for the following (so long as complying
with the Parent Financing Documents (and any Permitted Refinancing thereof) from
time to time in effect (if then in effect)):
(a) the Loans and the other Obligations (including the
Guarantees) under the Credit Documents;
(b) the Existing Credit Facility, the Existing Notes (less all
repayments and prepayments thereof), the Parent Notes (but only so long
as not a direct or indirect obligation of Borrower or any Subsidiary),
other Indebtedness and Contingent Obligations (other than the Existing
Notes and the Existing Credit Facility) outstanding on the Closing Date
and listed in Schedule 9.08 and specified on Schedule 9.08 as to remain
outstanding after the Closing Date (less the aggregate amount of any
permanent prepayments or repayments thereof) and, in the case of the
Parent Notes and any such Indebtedness listed on Schedule 9.08,
Permitted Refinancings thereof; provided, however, that the Existing
Credit Facility shall not be outstanding after the Closing Date;
(c) Indebtedness and Contingent Obligations of (I) Parent
owing to Borrower or any Qualified Subsidiary to the extent such
Indebtedness represents an Investment by Borrower or such Qualified
Subsidiary made in compliance with Section 9.09(A)(r) or an
intercompany loan in the amount of any Dividend permitted by Section
9.10 (and which has not been paid as a Dividend pursuant to Section
9.10), or (II) Borrower or any Subsidiary owing to Borrower or any
Qualified Subsidiary; provided, however, that (1) such Indebtedness
shall be evidenced by an Intercompany Note which shall be pledged to
Administrative Agent on behalf of the Lenders pursuant to the Security
Agreement, (2) such Indebtedness and Contingent Obligations shall not
be held by any Person other than Borrower or a Qualified Subsidiary and
shall not be subordinate to any other Indebtedness or Contingent
Obligations or other obligation of the obligor unless also subordinated
to the Loans on terms no less favorable to the Lenders than that of any
other creditor, and (3) any payment by any Subsidiary under the
Guarantee of the Obligations shall result in a pro tanto reduction of
the Indebtedness owed by such Subsidiary to any Company for which such
payment is made;
(d) Contingent Obligations in respect of operating leases
permitted by Section 9.21;
(e) Indebtedness and Contingent Obligations arising from
honoring a check, draft or similar instrument against insufficient
funds; provided, however, that such Indebtedness is extinguished within
two Business Days of its incurrence;
(f) Swap Contracts entered into in the ordinary course of
business and designed to protect the Obligors against fluctuations in
interest rates, currency exchange rates, or similar risks (including
any Interest Rate Protection Agreement entered into pursuant to Section
9.18);
(g) Contingent Obligations of Borrower or any Qualified
Subsidiary in respect of Indebtedness or other liabilities of Borrower
or any Subsidiary to the extent that the existence of such Indebtedness
or other liabilities is not prohibited under this Agreement;
(h) Contingent Obligations in connection with Dispositions
permitted under Section 9.06, arising in connection with
indemnification and other agreements in respect of any contract
relating to such Disposition, not to exceed the consideration received
by Borrower or any Subsidiary in connection with such sale and
excluding, however, in all cases any Contingent Obligation with respect
to any obligation of any third person incurred in connection with the
acquisition of the Property which is the subject of such Disposition;
(i) Indebtedness and Contingent Obligations of Borrower and
the Subsidiaries (including Permitted Refinancings thereof) secured by
Liens permitted under Section 9.07(g) or (l) (and extensions, renewals
or replacements thereof pursuant to Section 9.07 (v)) not exceeding
(together with any Permitted Refinancing thereof) $25.0 million in the
aggregate at any time outstanding for Borrower and the Subsidiaries
collectively;
(j) Indebtedness of a Person that becomes a Subsidiary after
the date hereof; provided, however, that (1) such Indebtedness existed
at the time such Person became a Subsidiary and was not created in
connection with or in anticipation thereof, (2) immediately after
giving effect to the acquisition of such Person by Borrower no Default
shall have occurred and be continuing, and (3) the aggregate amount of
Indebtedness outstanding at any time pursuant to this Section 9.08(j)
shall not exceed $25.0 million for all Subsidiaries; and
(k) Indebtedness and Contingent Obligations incurred by
Borrower, and any Permitted Refinancing thereof, not to exceed in the
aggregate at any time outstanding the excess of (1) $35.0 million over
(2) the aggregate amount of Indebtedness outstanding pursuant to
Section 9.08(j).
All intercompany debt shall be unsecured and subordinate in
right of payment (to the same extent as the subordination provisions set forth
in Exhibit B hereto) to the Obligations. Each Obligor, by its execution and
delivery of this Agreement, hereby agrees to subordinate its right of payment
under any intercompany debt owed to it by Borrower or any Subsidiary to the full
and complete payment and performance of the Obligations. No Obligor shall incur
any Subordinated Debt unless such Subordinated Debt shall be subordinated to the
Obligations at least to the same extent and for so long as such Subordinated
Debt is subordinated to such other Indebtedness pursuant to documentation
reasonably acceptable to Arrangers.
9.09. Limitation on Investments; Limitation on Creation of
Subsidiaries and Unrestricted Subsidiaries. (A) No Company shall, directly or
indirectly, make or permit to remain outstanding any Investments, except for the
following (so long as complying with the Parent Financing Documents (and any
Permitted Refinancing thereof) from time to time in effect (if then in effect)):
(a) operating deposit accounts and certificates of deposit
with banks in the ordinary course of business;
(b) Permitted Investments;
(c) Investments by (1) Parent, Borrower or any Subsidiary in
any Qualified Subsidiary or in any Subsidiary if as a result thereof or
in connection therewith such Subsidiary becomes a Qualified Subsidiary
(provided that no Investment will be permitted in respect of any
Subsidiary with respect to which Borrower has not complied with Section
9.20), (2) Parent or any Subsidiary in Borrower, and (3) Borrower in
Parent of any amount that could be paid as a Dividend pursuant to
Section 9.10 and has not been so paid as a Dividend;
(d) Investments outstanding on the Closing Date and identified
in Schedule 9.09 and any renewals, amendments and replacements thereof
that do not increase the amount thereof;
(e) Investments that constitute Indebtedness or Contingent
Obligations permitted under Section 9.08;
(f) advances, loans or extensions of credit by any Company to
(1) employees of any Company in the ordinary course of business;
provided, however, that the aggregate amount of all such loans,
advances and extensions of credit (other than pursuant to clause (2) or
clause (3) of this Section 9.09(f)) shall not at any time exceed in the
aggregate $3.0 million (without giving effect to any write-down or
write-off thereof), (2) employees of any Company in connection with
stock option plans so long as (x) such loans do not involve cash
payments by any Company and (y) no Company incurs any obligations at
any time to repurchase the stock so purchased, and (3) John Fujii and
Brian McTernan in an aggregate amount of $2.0 million to finance the
purchase of Equity Interests of Parent which by its terms require
repayment in full upon the earlier of (x) the first anniversary of the
Closing Date and (y) sale of Acme Paging, L.P.;
(g) extensions of credit in the nature of accounts receivable
or notes receivable arising from the sale or lease of goods or services
in the ordinary course of business;
(h) pledges or deposits required in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other social security or similar legislation;
(i) pledges or deposits in connection with (i) the
non-delinquent performance of bids, trade contracts (other than for
borrowed money), leases or statutory obligations, (ii) contingent
obligations on surety or appeal bonds, and (iii) other non-delinquent
obligations of a like nature, in each case incurred in the ordinary
course of business;
(j) Investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course
of business;
(k) Borrower and the Subsidiaries may hold additional
Investments in any Subsidiary which is not a Qualified Subsidiary to
the extent that such Investments reflect an increase in the
stockholders' equity of such Subsidiary resulting from retained
earnings of such Subsidiary;
(l) Capital Expenditures not prohibited by this Agreement;
(m) Investments by any Company in any Subsidiary which is not
a Qualified Subsidiary to the extent made in the ordinary course to
fund or support the ordinary course operations of such Subsidiary so
long as no Default shall have occurred and be continuing; provided,
however, that (1) other than with respect to any Subsidiary of which
not less than 80% of the Equity Interests are owned directly or
indirectly by Borrower, the amount of such Investments made pursuant to
this clause (m) shall not exceed $5.0 million in the aggregate
outstanding at any time (without giving effect to any write-down or
write-off thereof), and (2) all such Investments shall be evidenced by
Intercompany Notes, which shall be pledged to Administrative Agent
pursuant to the Security Agreement;
(n) Borrower or any Subsidiary may hold the Equity Interests
of any Subsidiary existing on the Closing Date or created or acquired
thereafter in accordance with the provisions hereof and any additional
Equity Interests issued in exchange therefor or as a dividend thereon;
(o) Investments consisting of non-cash consideration received
in the form of securities, notes or similar obligations in connection
with any Disposition (which shall not be subordinated by its terms to
any obligations of the issuer thereof); provided, however, that (1) the
aggregate amount of such non-cash consideration received in connection
with any such Disposition shall not exceed 25% of the total
consideration received in connection with such Disposition, (2) such
non-cash consideration is pledged pursuant to the appropriate Security
Document, and (3) the aggregate amount of such Investments made and
outstanding at any time shall not exceed $25.0 million (without giving
effect to any write-downs or write-offs thereof);
(p) Investments consisting of or made in order to consummate
Acquisitions permitted by Section 9.06(h) or (i) and Acquisitions
effected in accordance with Section 9.06(p);
(q) Investments (other than any direct or indirect Guaranty
Obligation in respect of any Indebtedness, Contingent Obligation or
other liabilities or obligations or any Investment which would
otherwise be contrary to the purposes of Section 9.28) by Parent in any
Unrestricted Subsidiary; provided, however, that (1) Parent shall be in
compliance with Section 9.09(D) with respect to any Unrestricted
Subsidiary in which such Investment is being made, (2) at the time of
making any such Investment no Default shall exist or would arise
therefrom, (3) such Investments shall not exceed in the aggregate
outstanding at any time (without giving effect to any write-downs or
write-offs thereof, but net of any cash returns of capital, cash
dividends and cash distributions received in respect thereof) the sum
of (I) not more than $25.0 million of the portion of the Net Available
Proceeds of any Equity Issuance not required to be applied to the
prepayment of the Loans pursuant to Section 2.10(a)(ii) and not
previously expended pursuant to Section 9.09(A)(r), plus (II) the Net
Available Proceeds of any Excluded Investor Equity Issuance not
previously expended pursuant to Section 9.09(A)(r), plus (III) any Net
Available Proceeds of any Disposition contemplated by clause (iii) of
the definition thereof relating to any Unrestricted Subsidiary other
than an Unrestricted Subsidiary of Borrower not required to be applied
to the prepayment of the Loans pursuant to Section 2.10(a)(iv) and not
previously expended pursuant to Section 9.09(A)(r), and (4) no such
Investment shall be permitted to be made with any amount described in
the foregoing subclause (3)(I) until after the portion of the Net
Available Proceeds of such Equity Issuance required to be applied to
the prepayment of the Loans pursuant to Section 2.10(a)(ii) shall have
been applied to the prepayment of the Loans; and
(r) in addition to the foregoing, other Investments by
Borrower or any Subsidiary not exceeding in the aggregate outstanding
at any time (without giving effect to any write-downs or write-offs
thereof, but net of any cash returns of capital, cash dividends and
cash distributions received in respect thereof) the sum of (1) $25.0
million, plus (2) the aggregate sum of the portion of the Net Available
Proceeds from all Equity Issuances since the Closing Date not required
to be applied to the prepayment of the Loans pursuant to Section
2.10(a)(ii) and not previously expended pursuant to Section 9.09(A)(q),
plus (3) any Net Available Proceeds of any Disposition contemplated by
clause (iii) of the definition thereof not required to be applied to
the prepayment of the Loans pursuant to Section 2.10(a)(iv) and not
previously expended pursuant to Section 9.09(A)(q), plus (4) the Net
Available Proceeds of any Excluded Investor Equity Issuance not
previously expended pursuant to Section 9.09(A)(q); provided, however,
that (w) any Investment made pursuant to this Section 9.06(A)(r) that
results in $25.0 million or more being then outstanding (without giving
effect to any write-downs or write-offs thereof, but net of cash
returns of capital, cash dividends and cash distributions received in
respect thereof) shall only be made in a Subsidiary or in a Person whom
Borrower or a Subsidiary has the power to control the management and
affairs thereof as certified to Arrangers by Borrower in an Officers'
Certificate delivered prior to the time of the making of such
Investment and providing documentation evidencing such control (and
such Investment shall be permitted hereunder only so long as Borrower
or a Subsidiary has such control), (x) no such Investment shall be
permitted to be made with the Net Available Proceeds of any Equity
Issuance until after the portion of the Net Available Proceeds of such
Equity Issuance required to be applied to the prepayment of the Loans
pursuant to Section 2.10(a)(ii) shall have been applied to the
prepayment of the Loans, (y) at the time of making any such Investment
no Default shall exist or would arise therefrom, and (z) if such
Investment is an Investment by Borrower or any Subsidiary in any
Unrestricted Subsidiary (whether of Parent or Borrower) such Investment
shall not be a direct or indirect Guaranty Obligation of any
Indebtedness, Contingent Obligation or other liabilities or obligations
of such Unrestricted Subsidiary or otherwise be contrary to the
purposes of Section 9.28.
(B) No Company shall, directly or indirectly, create or
acquire any Subsidiary without the prior written consent of the Majority
Lenders, which consent shall not be unreasonably withheld; provided, however,
that (1) the provisions of this Section 9.09(B) shall not require the Majority
Lenders' consent for (I) the creation or acquisition of direct or indirect
Wholly Owned Subsidiaries so long as Section 9.20 is complied with at the time
of formation or acquisition thereof, (II) the creation or acquisition of any
Subsidiary which is not a Wholly Owned Subsidiary so long as the Investment made
in connection therewith complies with Section 9.09(A) and so long as Section
9.20 is complied with at the time of formation or acquisition thereof, and (III)
the acquisition of any Subsidiary made in compliance with Section 9.06(o) or (r)
so long as Section 9.20 is complied with at the time of such acquisition; and
(2) all Investments in any Subsidiary, including in connection with the creation
or acquisition thereof, must comply with Section 9.09(A). Parent shall not
permit any Unrestricted Subsidiary to become an obligor with respect to the
Parent Notes.
(C) No Company shall cause or permit the majority of the
members of the board of directors or other governing body of any Company (other
than Parent) or Unrestricted Subsidiary to be Persons designated by any Person
other than (I) Parent, (II) any Subsidiary of which a majority of the members of
the board of directors or other governing body are designees of Parent or
Borrower, or (III) any Unrestricted Subsidiary of which the majority of the
members of the board of directors or other governing body are designees of
Parent or Borrower, except that no Unrestricted Subsidiary may designate any
member of the board of directors or other governing body of any Company.
(D) No Company shall create or acquire any direct or indirect
Unrestricted Subsidiary unless at the time of creation or acquisition thereof
(1) Parent and Borrower shall have or shall have caused the applicable
Unrestricted Subsidiary to comply with Section 9.12 and Section 9.13, and (2)
the Companies and such Unrestricted Subsidiary shall have entered into a tax
sharing agreement which is in full force and effect on terms and conditions
satisfactory to Arrangers in their reasonable discretion.
9.10. Limitation on Dividend Payments. No Company shall,
directly or indirectly, declare or make any Dividend Payment at any time,
except:
(a) any Subsidiary may declare and make Dividend Payments
to Borrower or any Subsidiary;
(b) Dividend Payments on the date of consummation of the
Mergers necessary to consummate the Transactions in accordance with the
Transaction Documents;
(c) so long as no Default has occurred and is continuing or
would arise therefrom, Borrower may make Dividend Payments to Parent if
the proceeds thereof are used at the time of such Dividend Payment by
Parent (and Parent may use such Dividend Payments by Borrower as set
forth below):
(i) to pay out-of-pocket expenses, for administrative,
legal and accounting services provided by third parties that
are reasonable and customary and incurred in the ordinary
course of business for the professional services, or to pay
franchise fees and similar costs;
(ii) to pay taxes of the Companies and the Unrestricted
Subsidiaries which are Subsidiaries of Borrower as part of a
consolidated, combined or unitary tax filing group or of the
separate operations of Parent which are actually due and
payable arising from the ownership of the Equity Interests of
Borrower by Parent (not to exceed in any event the amount of
tax that Borrower and the Subsidiaries would otherwise pay if
not part of such filing group); provided, however, that with
respect to any such Dividend Payment relating to taxes
attributable to any Unrestricted Subsidiary which is a
Subsidiary of Borrower, such payments may only be made in
accordance with a tax sharing agreement entered into by the
Companies and such Unrestricted Subsidiary in accordance with
Section 9.09(D); and
(iii) to redeem Equity Interests (other than Disqualified
Capital Stock) held by current or former employees or
directors of any Company (or their estates or beneficiaries of
their estates) upon the death, disability, retirement or
termination of employment or directorship, as the case may be,
pursuant to any agreement in effect on the Closing Date as in
effect on the Closing Date and pursuant to other agreements on
substantially similar terms entered into after the Closing
Date; provided, however, that the aggregate cash consideration
paid, or distributions made, pursuant to this clause (c)(iii)
shall not exceed $5.0 million in the aggregate since the
Closing Date, plus, in each case, the proceeds of any Excluded
Equity Issuance consummated contemporaneously with such
purchase or redemption; and
(d) so long as no Default under Section 10(a) or 10(d) with
respect to Section 9.11 has occurred and is continuing or would arise
therefrom, Borrower may after the Parent Interest Trigger Date make
Dividend Payments to Parent not earlier than the second Business Day
prior to the due date of any scheduled interest payment on the Parent
Notes if the proceeds thereof are used at the time of such Dividend
Payment by Parent to pay, on the scheduled semiannual interest payments
dates, interest accrued on the Parent Notes subsequent to the Parent
Interest Trigger Date.
Notwithstanding the foregoing, no Dividend permitted by the
terms of this Section 9.10 may be made if Borrower has already made an
Investment in Parent pursuant to Section 9.09(A)(c)(3) in the amount of such
Dividend permitted at such time (it being understood that this Section 9.10
shall not prohibit the forgiveness of a loan made pursuant to Section
9.09(A)(c)(3)).
9.11. Financial Covenants.
(a) Maximum Total Leverage Ratio. The Total Leverage Ratio
shall not, as of any Test Date during any period set forth in the table below,
exceed the ratio set forth opposite such period in the table below:
Period Ratio
------ -----
Closing Date - 3/31/99 9.00
4/1/99 - 6/30/99 8.75
7/1/99 - 9/30/99 8.00
10/1/99 - 3/31/00 7.50
4/1/00 - 6/30/00 6.75
7/1/00 - 9/30/00 6.50
10/1/00 - 3/31/02 6.25
4/1/02 - 6/30/02 6.00
7/1/02 - 9/30/02 5.50
10/1/02 - 3/31/03 5.25
4/1/03 - and thereafter 5.00
(b) Maximum Senior Leverage Ratio. The Senior Leverage Ratio
shall not, as of any Test Date during any period set forth in the table below,
exceed the ratio set forth opposite such period in the table below:
Period Ratio
------ -----
7/1/01 - 9/30/01 5.25
10/1/01 - 12/31/01 5.00
1/1/02 - 3/31/02 4.75
4/1/02 - 6/30/02 4.50
7/1/02 - 9/30/02 4.25
10/1/02 - and thereafter 4.00
(c) Minimum Interest Coverage Ratio. The Interest Coverage
Ratio shall not, as of any Test Date during any period set forth in the table
below, be less than the ratio set forth opposite such period in the table below:
Period Ratio
------ -----
7/1/98 - 6/30/99 1.20
7/1/99 - 6/30/00 1.25
7/1/00 - 6/30/02 1.50
7/1/02 - 6/30/03 1.75
7/1/03 - and thereafter 2.00
(d) Minimum Fixed Charge Coverage Ratio. The Fixed Charge
Coverage Ratio shall not, as of any Test Date during any period set forth in the
table below, be less than the ratio set forth opposite such period in the table
below:
Period Ratio
------ -----
7/1/98 - 6/30/02 1.00
7/1/02 - and thereafter 1.10
(e) Minimum Pro Forma Debt Service Coverage Ratio. The Pro
Forma Debt Service Coverage Ratio shall not, as of any Test Date during any
period set forth in the table below, be less than the ratio set forth opposite
such period in the table below:
Period Ratio
------ -----
1/1/00 - 6/30/01 1.10
7/1/01 - 6/30/02 1.20
7/1/02 - and thereafter 1.25
9.12. Pledge or Mortgage of Additional Collateral. Promptly,
and in any event within 30 days, after the acquisition of any Property of the
type that would have constituted Collateral at the Closing Date (including the
Equity Interests of any Subsidiary or Unrestricted Subsidiary hereafter created
or acquired) other than Real Property (the "Additional Collateral") and after
the creation or acquisition of any Subsidiary or Unrestricted Subsidiary, each
Company shall take all action reasonably necessary or desirable, if any,
including the execution and delivery of all such agreements, assignments,
documents, registers and instruments (including amendments to the Credit
Documents) and the filing of appropriate financing statements or other documents
under the provisions of the UCC or applicable requirements of any Governmental
Authority in each of the offices where such filing is necessary or appropriate,
to grant (in the reasonable judgment of Administrative Agent or the Majority
Lenders) to Administrative Agent for the benefit of the Issuing Lender, Lenders
and Agents a duly perfected first priority Lien on such Property pursuant to
appropriate Security Documents.
In the event that, after the Closing Date, any Company
(including any Subsidiary created or acquired on or after the Closing Date)
acquires or holds an interest with a fair market value of $5.0 million or more
in any Real Property, such Company shall notify Administrative Agent and, if
requested by Majority Lenders or Administrative Agent, (i) take such actions and
execute such documents as Administrative Agent or the Majority Lenders shall
reasonably require to confirm the Lien of an existing Mortgage, if applicable,
or to create a new Mortgage on such additional Real Property and (ii) cause to
be delivered to Administrative Agent, on behalf of the Lenders, the documents
and instruments reasonably requested by Administrative Agent, including, without
limitation, the items set forth in Section 7.01 in respect of Mortgaged Real
Property. If requested by Arrangers or the Majority Lenders, Borrower shall
obtain at its sole expense and as soon as practicable but in any event not later
than 45 days after request therefor, Phase 1 environmental reports from an
environmental engineering firm reasonably acceptable to Arrangers with respect
to any Real Property held by any Company if not delivered on or prior to the
Closing Date.
With respect to each such Real Property, each such Company
shall cause to be delivered to Administrative Agent, on behalf of the Lenders,
the following documents and instruments:
(i) a Mortgage encumbering each Mortgaged Real Property in
favor of Administrative Agent, for the benefit of Co-Arrangers, Issuing
Lender and Lenders, in form for recording in the recording office of
each jurisdiction where each such Mortgaged Real Property is situated,
together with such other documentation as shall be required to create a
lien under applicable law, and other similar statements as are
contemplated by counsel for Administrative Agent and the Lenders, all
of which shall be in form and substance reasonably satisfactory to
Administrative Agent, which Mortgage and other instruments shall be
effective to create a first priority Lien on such Mortgaged Real
Property subject to no Liens other than Prior Liens applicable to such
Mortgaged Real Property;
(ii) with respect to each Mortgaged Real Property, such
consents, lien waivers, approvals, estoppels, tenant subordination
agreements or other instruments as necessary or as shall be reasonably
deemed required by Administrative Agent to consummate the transactions
contemplated hereby or to grant the Lien contemplated by the Mortgage;
and
(iii) the following documents and instruments:
(1) with respect to each Mortgaged Real Property, if
required to obtain the title insurance coverage (if any)
required by Administrative Agent, a Survey;
(2) with respect to each Mortgaged Real Property,
policies or certificates of insurance as reasonably required
by the Mortgage relating thereto;
(3) with respect to each Mortgaged Real Property,
judgment, tax and other lien searches in form and substance
satisfactory to Administrative Agent;
(4) evidence acceptable to Administrative Agent of
payment by Borrower of all title insurance premiums (if any),
search and examination charges, survey costs, mortgage
recording taxes and related charges required for the recording
of the Mortgages and issuance of the title insurance policies
(if any) referred to in this Section 9.12;
(5) with respect to each Real Property or Mortgaged
Real Property, copies of all material leases in which Borrower
holds the landlord's or the tenant's interest, each of which
shall be reasonably acceptable to Administrative Agent;
(6) with respect to each Mortgaged Real Property, an
Officer's Certificate that as of the date thereof there (a)
has been issued and is in effect, to the extent required, a
valid and proper certificate of occupancy of local or foreign
equivalent (if any) for the use then being made of such
Mortgaged Real Property, (b) has not occurred any uncured
material Casualty Event of any Mortgaged Real Property and (c)
except as may be disclosed in the Survey of such Mortgaged
Real Property delivered pursuant to subclause (iii)(1) of this
Section 9.12 above, are no material disputes regarding
boundary lines, location, encroachment or possession of such
Mortgaged Real Property and no state of facts existing which
could reasonably be expected to give rise to any such claim;
(7) if required by Administrative Agent or Majority
Lenders, a policy (or commitment to issue a policy) of title
insurance insuring (or committing to insure) the Lien of such
Mortgage as a valid first priority Lien on the real property
and fixtures described therein in such amount not to exceed
100% of the fair market value thereof as Administrative Agent
may reasonably require which policy (or commitment) shall (a)
be issued by the Title Company or another title insurance
company acceptable to Administrative Agent, (b) include such
reinsurance arrangements (with provisions for direct access)
as shall be reasonably acceptable to Administrative Agent, (c)
have been supplemented by such endorsements (or where such
endorsements are not available, opinions of special counsel or
other professionals acceptable to the Arranger) as shall be
reasonably requested by Administrative Agent, (d) include such
affidavits and instruments of indemnifications by Borrower and
the applicable Subsidiary as shall be reasonably required to
induce such title insurance company to issue the policy or
policies (or commitment) and endorsements contemplated in this
paragraph (7), and (e) contain no exceptions to title other
than exceptions for Prior Liens; and
(8) with respect to each Mortgaged Real Property,
all such other items as shall be necessary in the opinion of
counsel to the Lenders to create a valid perfected first
priority mortgage in such Mortgaged Real Property.
The costs of all actions taken by the parties in connection
with the pledge of Additional Collateral or in connection with any Mortgage,
including reasonable costs of counsel for Administrative Agent, shall be paid by
the Obligors promptly following written demand.
9.13. Security Interests; Further Assurances. Each Company and
Unrestricted Subsidiary shall, promptly, upon the reasonable request of
Administrative Agent or any Lender, at Borrower's expense, execute, acknowledge
and deliver, or cause the execution, acknowledgment and delivery of, and
thereafter register, file or record, or cause to be registered, filed or
recorded, in an appropriate governmental office, any document or instrument
supplemental to or confirmatory of the Security Documents or otherwise deemed by
Administrative Agent reasonably necessary or desirable for the continued
validity, perfection and priority of the Liens on the Collateral covered
thereby, or obtain any consents, including, without limitation, landlord or
similar lien waivers and consents, as may be necessary or appropriate in
connection therewith.
Each Company and Unrestricted Subsidiary shall deliver or
cause to be delivered to Administrative Agent from time to time such other
documentation, consents, authorizations, approvals and orders in form and
substance reasonably satisfactory to Administrative Agent as Administrative
Agent shall reasonably deem necessary to perfect or maintain the Liens on the
Collateral.
If any Lender determines in good faith that it is required by
any Governmental Authority or any Requirement of Law to obtain appraisals as to
the market value of any Real Property constituting Collateral, Borrower shall
obtain such appraisals as soon as practicable but in any event not less than 45
days after request therefor, at the sole cost and expense of Borrower and in
conformity with the requirements of such Governmental Authority and all
Requirements of Law, as from time to time in effect.
Upon the exercise by Administrative Agent or the Lenders of
any power, right, privilege or remedy pursuant to any Credit Document which
requires any consent, approval, registration, qualification or authorization of
any Governmental Authority, each Company shall execute and deliver all
applications, certifications, instruments and other documents and papers that
Administrative Agent or the Lenders may be so required to obtain.
9.14. Compliance with Environmental Laws. (a) Each Company and
Unrestricted Subsidiary shall comply with all Environmental Laws, and will keep
or cause all Real Property to be kept free of any Liens under Environmental
Laws, unless failure to do so could not reasonably be expected to have a
Material Adverse Effect or subject any Agent, Lender or Issuing Lender to any
material risk of damages or liability; (b) in the event of the presence of any
Hazardous Material at, on, under or emanating from any Real Property which would
reasonably be expected to result in liability under or a violation of any
Environmental Law, in each case which could reasonably be expected to have a
Material Adverse Effect, each Company and Unrestricted Subsidiary shall
undertake, and/or cause any of their respective tenants or occupants to
undertake, at their sole expense, any action required pursuant to Environmental
Laws to mitigate and eliminate such presence; provided, however, that no Company
or Unrestricted Subsidiary shall be required to comply with any order or
directive which is being contested in good faith and by proper proceedings so
long as it has maintained adequate reserves with respect to such compliance to
the extent required in accordance with GAAP; (c) each Company shall promptly
notify Administrative Agent of the occurrence of any event specified in clause
(b) of this Section 9.14 and shall periodically thereafter keep Administrative
Agent informed of any material actions taken in response to such event and the
results of such actions; and (d) at the written request of Administrative Agent
at any time and from time to time, such Obligor will provide, at such Obligor's
sole cost and expense, an environmental site assessment (including, without
limitation, the results of any groundwater or other testing, conducted if
Administrative Agent directs that such testing be conducted) concerning any Real
Property now or hereafter owned, leased or operated by any Company or any
Unrestricted Subsidiary, conducted by an environmental consulting firm proposed
by such Obligor and approved by Administrative Agent indicating the presence or
absence of Hazardous Materials and the potential cost of any required
investigation or other response or any corrective action in connection with any
Hazardous Materials on, at, under or emanating from such Real Property;
provided, however, that such request may be made only if (a) there has occurred
and is continuing an Event of Default, (b) Administrative Agent reasonably
believes that any Company or any Unrestricted Subsidiary or any such Real
Property is not in material compliance with Environmental Law or (c)
circumstances exist that reasonably could be expected to form the basis of an
Environmental Claim against such Company or Unrestricted Subsidiary or any such
Real Property which would have a Material Adverse Effect. If any Obligor fails
to provide the same within 60 days after such request was made, Administrative
Agent may but is under no obligation to conduct the same, and such Obligor shall
grant and hereby grants to Administrative Agent and its agents access to such
Real Property and specifically grants Administrative Agent an irrevocable
non-exclusive license, subject to the rights of tenants, to undertake such an
assessment, all at such Obligor's sole cost and expense.
9.15. Limitation on Transactions with Affiliates. No Company
shall, directly or indirectly: enter into or permit to exist any transaction
(including, without limitation, the purchase, sale, lease or exchange of any
Property, the rendering of any service, or a merger or consolidation), with or
for the benefit of any Affiliate (an "Affiliate Transaction") unless such
Affiliate Transaction is (i) otherwise not prohibited under this Agreement and
(ii) on fair and reasonable terms that are not less favorable to such Company
than those that are reasonably obtainable at the time in an arm's-length
transaction with a Person that is not such an Affiliate; provided, however, that
the following shall be permitted: (a) Dividend Payments permitted by Section
9.10; (b) reasonable fees and compensation paid to, and customary indemnity and
reimbursement provided on behalf of, officers, directors and employees of any
Company in the ordinary course of business; (c) loans or advances to employees
permitted by Section 9.09; (d) so long as no Event of Default shall have
occurred and be continuing, transactions and agreements contemplated by any
management agreements entered into with any one or more Excluded Persons so long
as the terms and conditions thereof are reasonably satisfactory to Arrangers; or
(e) transactions and agreements in existence on the Closing Date and listed in
Schedule 9.15 (as such agreements are in effect on the Closing Date, the
"Existing Affiliate Agreements") and the transactions pursuant to the Existing
Affiliate Agreements.
9.16. Limitation on Accounting Changes; Limitation on
Investment Company Status. No Company shall make or permit, any change in (i)
accounting policies or reporting practices, except immaterial changes and except
as required by generally accepted accounting principles or (ii) its fiscal year
end (December 31 of each year). No Obligor shall be or become an investment
company subject to the registration requirements under the United States
Investment Company Act of 1940, as amended.
9.17. Limitation on Modifications of Certain Documents, Etc.
No Company shall, directly or indirectly, consent to any modification,
supplement or waiver of, or amend, in any manner which could reasonably be
expected to be materially adverse to the Lenders, any of the provisions of any
Organic Document or any material contract or agreement. No material change that
could reasonably be expected to be adverse to the Lenders may be made to the
Merger Agreement, the Laredo JV Agreement, any Supplemental Indenture or the
provisions of Parent's certificate of designations or any other agreement or
instrument with respect to the New Preferred without the consent of Arrangers
and the Majority Lenders.
9.18. Interest Rate Protection Agreements. Borrower shall
obtain, on or within 90 days after the Closing Date, interest rate protection
agreements having terms and with counterparties reasonably satisfactory to
Arrangers as shall result in effectively limiting the interest cost to the
Companies of 50% of the aggregate principal amount of then outstanding Total
Debt of the Companies for a period of at least three years from the date the
initial interest rate protection agreements were obtained.
9.19. Limitation on Certain Restrictions Affecting
Subsidiaries. No Company shall, directly or indirectly, create or otherwise
cause or suffer to exist or become effective any direct or indirect encumbrance
or restriction on the ability of any Subsidiary to (a) pay dividends or make any
other distributions on such Subsidiary's Equity Interests or any other interest
or participation in its profits owned by any Company, or pay any Indebtedness or
any other obligation owed to any Company, (b) make Investments in or to any
Company, or (c) transfer any of its Property to any Company. The foregoing shall
not prohibit (i) any such encumbrances or restrictions existing under or by
reason of (x) applicable law, (y) the Credit Documents or (z) the Parent
Financing Documents as in effect on the date hereof and any Permitted
Refinancing thereof so long as such restriction in such Permitted Refinancing is
not more disadvantageous to the Lenders or Borrower than the Parent Financing
Documents as in effect on the date hereof, (ii) restrictions on the transfer of
assets subject to a Lien permitted under Section 9.07, (iii) customary
restrictions on subletting or assignment of any lease governing a leasehold
interest of any Company, and (iv) restrictions on the transfer of any Property
subject to a Disposition permitted under this Agreement.
9.20. Additional Obligors; Cellular Licenses to Be Held by
License Subsidiaries. (A) Upon any Company creating or acquiring any Subsidiary
after the Closing Date (each such Subsidiary referred to herein as an
"Additional Obligor" and collectively as the "Additional Obligors"), Borrower
shall (i) cause each such Subsidiary to execute and deliver all such agreements,
guarantees, documents and certificates (including any amendments to the Credit
Documents and a Joinder Agreement substantially in the form of Exhibit I) as
Administrative Agent or the Majority Lenders may reasonably request and do such
other acts and things as Administrative Agent may reasonably request in order to
have such Subsidiary guarantee the Obligations in accordance with the terms of
the Credit Documents, (ii) promptly (I) execute and deliver to Administrative
Agent such amendments to the Security Documents as Administrative Agent deems
necessary or advisable in order to grant to Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in the
Equity Interests and debt securities of such new Subsidiary which are owned by
Borrower or any Subsidiary and required to be pledged pursuant to the Security
Agreement, (II) deliver to Administrative Agent the certificates representing
such Equity Interests and debt securities, together with (A) in the case of such
Equity Interests, undated stock powers endorsed in blank, and (B) in the case of
such debt securities, endorsed in blank, in each case executed and delivered by
a responsible officer of Borrower or such Subsidiary, as the case may be, (III)
cause such new Subsidiary to take such actions necessary or advisable to grant
to Administrative Agent for the benefit of the Lenders a perfected first
priority security interest in the collateral described in the Security Agreement
with respect to such new Subsidiary, including, without limitation, the filing
of Uniform Commercial Code financing statements in such jurisdictions as may be
required by the Security Agreement or by law or as may be reasonably requested
by Administrative Agent, and (IV) if reasonably requested by Administrative
Agent, deliver to Administrative Agent legal opinions relating to the matters
described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to Administrative Agent.
(B) The Obligors shall cause all Cellular Licenses of any
Company to be held, within 180 days of the Closing Date, and at all times
thereafter, by one or more License Subsidiaries, except that if any Company
shall acquire (including by merger) any Person that holds a Cellular License,
Borrower shall cause such Cellular License to be transferred to a License
Subsidiary within 10 Business Days of such acquisition.
9.21. Limitation on Leases. No Company shall become liable in
any way, whether directly or by assignment or as a guarantor or other surety,
for the obligations of the lessee under any operating lease, unless, immediately
after giving effect to the incurrence of liability with respect to such lease,
the Consolidated Rental Payments at the time in effect shall not exceed $20.0
million per annum.
9.22. Limitation on Change of Principal Place of Business or
Corporate Name. No Obligor shall change its principal place of business or its
corporate name (other than that of Borrower to American Wireless Corporation)
unless it shall have (a) given Administrative Agent at least twenty days'
advance written notice of such change, and (b) filed in all necessary
jurisdictions such documents as may be necessary to continue without impairment
or interruption the perfection and priority of the Liens on the Collateral in
favor of Administrative Agent pursuant to the Security Documents.
9.23. Limitation on Activities of Parent. Parent shall not
conduct any business, incur any obligations (other than under the agreements
relating to the Equity Financing, the Credit Documents and the Parent Financing
Documents) or hold or acquire any assets (other than the Equity Interests of (i)
Borrower, (ii) Unrestricted Subsidiaries and (iii) ConnectOne Communications
Corporation, PCPCS Corporation and ICSB Corporation, all of which under this
clause (iii) shall become Subsidiaries of Borrower or shall cease to exist
within 180 days of the Closing Date) and shall have no operations other than
holding such Equity Interests and activities reasonably related thereto.
9.24. Limitation on Issuance or Dispositions of Equity
Interests of Borrower, Subsidiaries and Unrestricted Subsidiaries. Borrower
shall not issue any of its Equity Interests or Equity Rights or permit any
Person to own any of its Equity Interests or Equity Rights other than Parent.
Parent shall not, directly or indirectly, effect any Disposition of any Equity
Interests or Equity Rights of Borrower other than the pledge thereof pursuant to
the Security Agreement. No Subsidiary or Unrestricted Subsidiary shall issue,
sell, assign, transfer or otherwise dispose of any of its Equity Interests or
Equity Rights, except (a) with respect to any Unrestricted Subsidiary, to Parent
or one or more Wholly Owned Unrestricted Subsidiaries, (b) with respect to any
Subsidiary, to Borrower or a Qualified Subsidiary and (c) directors' qualifying
shares as required by law. Neither Borrower nor any Subsidiary shall effect the
Disposition of any Equity Interests of any Subsidiary unless all Equity
Interests owned by Borrower and the Subsidiaries are sold pursuant thereto in
accordance with the Credit Documents, upon which sale the Guarantor of such
Subsidiary shall be automatically deemed to be released.
9.25. Limitation on Payments or Prepayments of Indebtedness or
Modification of Debt Documents. Parent shall not, and shall not cause or permit
any Subsidiary to, directly or indirectly:
(a) make any payment or prepayment (optional or otherwise) on
or redemption of or any payments in redemption, defeasance or repurchase of any
Indebtedness (other than the Loans), including the Parent Notes or any Existing
Notes (whether in cash, securities or other Property), except (1) regularly
scheduled mandatory payments of interest, (2) pursuant to the Note Tender or any
Permitted Refinancing or any redemption of the Existing PriCellular Notes not
converted on or prior to the Closing Date into Common Equity Interests of
PriCellular, (3) the conversion or exchange of any Indebtedness into shares of
common Equity Interests of Parent, and (4) exchange of Parent Notes for exchange
notes, as contemplated by the definition thereof;
(b) amend, supplement, waive or otherwise modify any of the
provisions of any Parent Financing Document or (other than in connection with
the Note Tender) any Existing Indenture (or any Permitted Refinancing thereof):
(i) which shortens the fixed maturity, or increases the rate
or shortens the time of payment of interest or dividends on, or
increases the amount or shortens the time of payment of any principal,
liquidation preference or premium payable whether at maturity, at a
date fixed for prepayment or by acceleration or otherwise of such
Indebtedness, or increases the amount of, or accelerates the time of
payment of, any fees payable in connection therewith;
(ii) which relates to the affirmative or negative covenants,
events of default, redemption or repurchase provisions, or remedies
under the documents or instruments evidencing such Indebtedness and the
effect of which is to subject Parent or any of its Subsidiaries to any
more onerous or more restrictive provisions; or
(iii) which otherwise adversely affects the interests of the
Lenders as senior creditors or the interests of the Lenders under this
Agreement or any other Credit Document in any respect; or
(c) effect any change in the Indenture in connection with the
Exchange Offer or enter into an Exchange Indenture which is different from the
Indenture in connection with the Exchange Offer in each case unless the terms
thereof are reasonably acceptable to Arrangers.
9.26. Casualty and Condemnation. Each Company will furnish to
the Administrative Agent and the Lenders prompt written notice of any casualty
or other insured damage to any material portion of the Collateral or the
commencement of any action or proceeding for the taking of any material portion
of the Collateral or any part thereof or interest therein under power of eminent
domain or by condemnation or similar proceeding.
9.27. Tax Sharing Arrangements. No Company shall enter into or
permit to exist any tax sharing agreement or similar arrangement unless the same
shall have been reviewed by, and consented to, by Arrangers.
9.28. Maintenance of Corporate Separateness. Parent shall not
permit any Unrestricted Subsidiary to, (a) fail to satisfy customary corporate
formalities, including (i) the holding of regular board of directors' and
shareholders' meetings, (ii) the maintenance of separate corporate records and
(iii) the maintenance of separate bank accounts in its own name; (b) fail to act
solely in its own corporate name and through its authorized officers and agents;
(c) commingle any of its money or other assets with any money or other assets of
any Obligor; or (d) take any action, or conduct its affairs in a manner which is
reasonably likely to result in the separate corporate existence of the Obligors
from the Unrestricted Subsidiaries to be ignored or the assets and liabilities
of any Unrestricted Subsidiary being substantively consolidated with those of
any Obligor in any Insolvency Proceeding. No Company shall make any payment to
any creditor of any Unrestricted Subsidiary or provide any direct or indirect
guarantee or other credit support for any Indebtedness or other obligations of
any Unrestricted Subsidiary. All financial statements of each Unrestricted
Subsidiary distributed to any creditor of an Unrestricted Subsidiary shall
clearly state the separateness of such Unrestricted Subsidiary from the
Companies.
9.29. Changes in Factual Information Regarding the Collateral.
Each Company will furnish to the Administrative Agent prompt written notice of
any change (i) in any Obligor's corporate name or in any trade name used to
identify it in the conduct of its business or in the ownership of its
properties, (ii) in the location of any Obligor's chief executive office, its
principal place of business, any office in which it maintains books or records
relating to Collateral owned by it or any office or facility at which Collateral
owned by it is located (including the establishment of any such new office or
facility), (iii) in any Obligor's identity or corporate structure, (iv)
resulting in any tangible Collateral being located in any jurisdiction in which
a financing statement must be, but has not been, filed in order to perfect the
Administrative Agent's Liens, or (v) in any Obligor's Federal Taxpayer
Identification Number. Each Company will not effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are required in order for the
Administrative Agent to continue at all times following such change to have a
valid, legal and perfected security interest in all the Collateral.
Section 10. Events of Default. If one or more of the
following events (herein called "Events of Default") shall occur and be
continuing:
(a) (i) Borrower shall default in the payment when due
(whether at stated maturity upon prepayment or repayment or
acceleration or otherwise) of any principal of any Loan or
Reimbursement Obligation, or (ii) Borrower shall default in the payment
when due of interest on any Loan or any Reimbursement Obligation or any
fee or any other amount payable by it hereunder or under any other
Credit Document when due and such default under this clause (ii) shall
have continued unremedied for three or more Business Days; or
(b) Any Company shall default in the payment when due of any
principal of or interest on any of its Indebtedness (other than the
Loans) aggregating $5.0 million or more, beyond the period of grace, if
any, provided in the instrument or agreement under which such
Indebtedness was created, after giving effect to any consents or
waivers relating thereto obtained before the expiration of any such
period of grace; or any event specified in any note, agreement,
indenture or other document evidencing or relating to any Indebtedness
aggregating $5.0 million or more if the effect of such event (after
giving effect to any consents or waivers relating thereto obtained
before the expiration of any such period of grace) is to cause, or
(with the giving of any notice or the lapse of time or both) to permit
the holder or holders of such Indebtedness (or a trustee or agent on
behalf of such holder or holders) to cause, such Indebtedness to become
due, or to be prepaid in full (whether by redemption, purchase, offer
to purchase or otherwise), prior to its stated maturity; or
(c) Any representation or warranty made or deemed made in any
Credit Document (or in any modification or supplement thereto) by any
Company or in any certificate furnished to any Creditor pursuant to the
provisions thereof, shall prove to have been false or misleading as of
the time made, deemed made or furnished in any material respect; or
(d) Any Obligor shall default in the performance of any of its
obligations under any of Sections 9.01(f), 9.06 through 9.11, 9.15,
9.19, 9.24, or 9.25; or any Obligor shall default in the performance of
any of its obligations under Section 5.02 of the Security Agreement; or
Borrower shall default in the performance of its obligations under
Section 9.01(e) or (k) and such default shall continue unremedied for
five Business Days; or any Obligor shall default in the performance of
any of its other obligations in this Agreement, the Security Documents
or the Letter of Credit Documents and such default shall continue
unremedied for a period of thirty days after written notice thereof to
such Obligor and Borrower by Administrative Agent or any Lender; or any
Unrestricted Subsidiary shall default in the performance of any of its
obligations under Section 5.02 of the Unrestricted Subsidiary Pledge
Agreement; or any Unrestricted Subsidiary shall default in the
performance of any of its other obligations in the Unrestricted
Subsidiary Pledge Agreement and such default shall continue unremedied
for a period of thirty days after written notice thereof to such
Unrestricted Subsidiary and Borrower by Administrative Agent or any
Lender; or
(e) Any Company or Significant Unrestricted Subsidiary shall
not, or shall admit in writing its inability to, or be generally unable
to, pay its debts as such debts become due; or
(f) Any Company or Significant Unrestricted Subsidiary shall
(i) apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself
or of all or a substantial part of its Property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence or consents
to any Insolvency Proceeding, (iv) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of debts,
(v) fail to controvert within 45 days or in a timely and appropriate
manner, or acquiesce in writing to, any petition filed against it in an
involuntary Insolvency Proceeding, or (vi) take any corporate action
for the purpose of effecting any of the foregoing; or
(g) (i) Any Insolvency Proceeding is commenced or filed
against any Company or Significant Unrestricted Subsidiary, or any
writ, judgment, warrant of attachment, execution or similar process is
issued or levied against any Company or Significant Subsidiary, and
either (1) such proceeding or petition shall not be dismissed, or such
writ, judgment, warrant of attachment, execution or similar process
shall not be released, vacated or fully bonded, within 45 days after
commencement, filing or levy or (2) such proceeding shall not be
actively contested by such Company or Significant Unrestricted
Subsidiary; (ii) any Company or Significant Unrestricted Subsidiary
admits the material allegations of a petition against it in any
Insolvency Proceeding, or an order for relief (or similar order under
non-U.S. law) is ordered in any Insolvency Proceeding; (iii) any
Company or Significant Unrestricted Subsidiary acquiesces in the
appointment of a receiver, receiver and manager, trustee, custodian,
conservator, liquidator, mortgagee in possession (or agent therefor),
or other similar person for itself or a substantial portion of its
Property or business; or (iv) an order of relief against any Company or
Significant Unrestricted Subsidiary shall be entered in any Involuntary
Proceeding; or
(h) A final judgment or judgments for the payment of money in
excess of $5.0 million in the aggregate (exclusive of judgment amounts
to the extent covered by insurance) shall be rendered by one or more
courts, administrative tribunals or other bodies having jurisdiction
against any Company and the same shall not be discharged (or provision
shall not be made for such discharge), vacated or bonded pending
appeal, or a stay of execution thereof shall not be procured, within 45
days from the date of entry thereof and such Company shall not, within
said period of 45 days, or such longer period during which execution of
the same shall have been stayed, appeal therefrom and cause the
execution thereof to be stayed during such appeal; or
(i) An ERISA Event shall have occurred that, in the opinion of
the Majority Lenders, when taken together with all other ERISA Events
that have occurred, is reasonably likely to result in liability of any
Company in an aggregate amount exceeding $5.0 million; or
(j) Any Change of Control shall occur; or
(k) Any Security Document after delivery thereof by any
Obligor at any time shall cease to be in full force and effect or shall
for any reason fail to create or cease to maintain a valid and duly
perfected first priority security interest in and Lien upon (subject to
Prior Liens and other Liens expressly permitted by the terms of the
applicable Security Document) any material portion of the Collateral;
or
(l) Any Guarantee ceases to be in full force and effect; or
(m) Any Credit Document or any material provision thereof
shall at any time and for any reason be declared by a court of
competent jurisdiction to be null and void, or a Proceeding shall be
commenced by any Company or any other Person, or by any Governmental
Authority, seeking to establish the invalidity or unenforceability
thereof (exclusive of questions of interpretation of any provision
thereof), or any Company shall repudiate or deny that it has any
liability or obligation for the payment of principal or interest or
other obligations purported to be created under any Credit Document; or
(n) Any non-monetary judgment, order or decree is entered
against any Company which is reasonably likely to have a Material
Adverse Effect, and there shall be any period of 45 consecutive days
during which a stay of enforcement of such judgment or order, by reason
of a pending appeal or otherwise, shall not be in effect; or
(o) The FCC shall deliver to any Company an order to show
cause why an order of revocation should not be issued based upon any
alleged attribution of alien ownership (within the meaning of 47 U.S.C.
Section 310(b) and any interpretation of the FCC thereunder) to any
Company and (i) such order shall not have been rescinded within 45 days
after such delivery, with respect to any material Cellular License or
(ii) in the reasonable judgment of the Majority Lenders, proceedings by
or before the FCC related to such order are reasonably likely to result
in one or more orders of revocation and would constitute an Event of
Default under Section 10(o); or
(p) One or more Cellular Licenses shall be terminated or
revoked such that any Company is no longer able to operate the related
Cellular System or any portion thereof and retain the revenue received
therefrom or one or more Cellular Licenses shall fail to be renewed at
the stated expiration thereof such that any Company is no longer able
to operate the related Cellular System or any portion thereof and
retain the revenue received therefrom, except with respect to any of
the foregoing in the event that the termination, revocation or failure
to renew is with respect to any Cellular License that is not material
(it being understood that material Cellular Licenses shall include (but
not be limited to) any Cellular License relating to 10% or more of
Operating Cash Flow of Borrower for the most recently ended two
consecutive fiscal quarters); or
(q) the existing President or Chief Executive Officer of
Parent and Borrower shall cease for any reason to be President or Chief
Executive Officer, as the case may be, and there shall not be a
replacement President or Chief Executive Officer, as the case may be,
reasonably satisfactory to Arrangers and the Majority Lenders within 90
days; or
(r) the Mergers shall not be consummated in all material
respects in accordance with this Agreement and (in the case of the
PriCellular Merger) the Merger Agreement substantially concurrently
with the making of the initial extensions of credit hereunder or the
Mergers shall be unwound, reversed or otherwise rescinded in whole or
in any material part for any reason; or
(s) any Existing PriCellular Notes that have not been
converted into common equity of PriCellular shall not have been
irrevocably called for redemption on the Closing Date or shall be
outstanding on the date which is 50 days after the Closing Date;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (f) or (g) of this Section 10, Administrative Agent may, and upon written
direction of the Majority Lenders shall, by notice to Borrower, terminate the
Commitments and/or declare the principal amount then outstanding of, and the
accrued interest on, the Loans, the Reimbursement Obligations and all other
amounts payable by Borrower hereunder and under the Notes (including any amounts
payable under Section 5.05 or 5.06) to be forthwith due and payable, whereupon
such amounts shall be immediately due and payable without presentment, demand,
protest or other formalities of any kind, all of which are hereby expressly
waived by Borrower, reduce any claim to judgment, take any other action
permitted by law and/or take any action permitted to be taken by the Security
Documents during the existence of an Event of Default; and (2) in the case of
the occurrence of an Event of Default referred to in clause (f) or (g) of this
Section 10, the Commitments shall automatically be terminated and the principal
amount then outstanding of, and the accrued interest on, the Loans, the
Reimbursement Obligations and all other amounts payable by Borrower hereunder
and under the Notes (including any amounts payable under Section 5.05 or 5.06)
shall automatically become immediately due and payable without presentment,
demand, protest or other formalities of any kind, all of which are hereby
expressly waived by Borrower.
In addition, Borrower agrees, upon the occurrence and during
the continuance of any Event of Default if Administrative Agent has declared the
principal amount then outstanding of, and accrued interest on, the Revolving
Credit Loans, and all other amounts payable to the Revolving Credit Lenders
hereunder and under the Notes evidencing such Loans to be due and payable, it
may and shall, if requested by the Majority Revolving Credit Lenders through
Administrative Agent (and, in the case of any Event of Default referred to in
clause (f) or (g) of this Section 10 with respect to any Company, forthwith,
without any demand or the taking of any other action by Administrative Agent or
such Lenders) provide cover for the Letter of Credit Liabilities by paying to
Administrative Agent immediately available funds in an amount equal to the then
aggregate undrawn face amount of all Letters of Credit, which funds shall be
held by Administrative Agent in the Collateral Account as collateral security in
the first instance for the Letter of Credit Liabilities and be subject to
withdrawal only as provided in the Security Agreement and the Unrestricted
Subsidiary Pledge Agreement.
Section 11. Agents.
11.01. General Provisions. Each of the Lenders, the Issuing
Lender and Syndication Agent hereby irrevocably appoints Administrative Agent as
its agent and authorizes Administrative Agent to take such actions on its behalf
and to exercise such powers as are delegated to Administrative Agent by the
terms hereof and the Security Documents, together with such actions and powers
as are reasonably incidental thereto. Administrative Agent agrees to give
promptly to each Lender a copy of each notice or other document received by it
pursuant to any Credit Document (other than any that are required to be
delivered to the Lenders by any Credit Party).
The Lender or other financial institution serving as any Agent
or Issuing Lender hereunder shall have the same rights and powers in its
capacity as a Lender as any other Lender and may exercise the same as though it
were not such Agent or Issuing Lender, and such bank and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of business
with any Company or other Affiliate thereof as if it were not such Agent or
Issuing Lender hereunder.
No Agent or Issuing Lender shall have any duties or
obligations except those expressly set forth herein. Without limiting the
generality of the foregoing, (a) no Agent or Issuing Lender shall be subject to
any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) no Agent or Issuing Lender shall have any duty
to take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby that such Agent or
Issuing Lender is required to exercise in writing by the Majority Lenders (or
such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 12.04), and (c) except as expressly set
forth herein, no Agent or Issuing Lender shall have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to any
Company that is communicated to or obtained by the financial institution serving
as such Agent or Issuing Lender or any of its Affiliates in any capacity. No
Agent or Issuing Lender shall be liable for any action taken or not taken by it
with the consent or at the request of the Majority Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 12.04) or in the absence of its own gross negligence or
willful misconduct. No Agent shall be deemed to have knowledge of any Default
unless and until written notice thereof is given to Administrative Agent and
such Agent by Borrower or a Lender, and no Agent or Issuing Lender shall be
responsible for or have any duty to ascertain or inquire into (i) any statement,
warranty or representation made in or in connection with this Agreement or any
other Credit Document, (ii) the contents of any certificate, report or other
document delivered hereunder or under any other Credit Document or in connection
herewith, (iii) the performance or observance of any of the covenants,
agreements or other terms or conditions set forth herein, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement or any other
Credit Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Section 7 or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to such
Agent.
Each Agent and Issuing Lender shall be entitled to rely upon,
and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper Person. Each
Agent and Issuing Lender also may rely upon any statement made to it orally or
by telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. Each Agent and Issuing Lender may
consult with legal counsel (who may be counsel for Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts. Each Agent and Issuing Lender may deem and
treat the payee of any Note as the owner thereof for all purposes unless a
written notice of assignment, negotiation or transfer thereof shall have been
filed with such Agent or Issuing Lender. Each Agent and Issuing Lender shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Credit Document unless it shall first receive such advice or
concurrence of the Majority Lenders (or, if so specified by this Agreement, all
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action (it
being understood that this provision shall not release Administrative Agent from
performing any action with respect to Borrower expressly required to be
performed by it pursuant to the terms hereof) under this Agreement. Each Agent
and Issuing Lender shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Credit Documents in
accordance with a request of the Majority Lenders (or, if so specified by this
Agreement, all Lenders), and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.
Each Agent and Issuing Lender may perform any and all its
duties and exercise its rights and powers by or through any one or more
sub-agents appointed by such Agent or Issuing Lender and reasonably acceptable
to Borrower. Each Agent, Issuing Lender and any such sub-agent may perform any
and all its duties and exercise its rights and powers through their respective
Affiliates, directors, officers, employees, agents and advisors ("Related
Parties"). The exculpatory provisions of the preceding paragraphs shall apply to
any such sub-agent and to the Related Parties of each Agent and Issuing Lender
and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities of such Agent or Issuing Lender.
Subject to the appointment and acceptance of a successor Agent
as provided in this paragraph, any Agent may resign at any time by notifying the
Lenders, the Issuing Lender (with respect to Administrative Agent only) and
Borrower. Upon any such resignation, the Majority Lenders shall have the right
to appoint a successor which, so long as no Event of Default is continuing,
shall be reasonably acceptable to Borrower. If no successor shall have been so
appointed by the Majority Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation, then
the retiring Agent may, on behalf of the Lenders and the Issuing Lender, appoint
a successor Agent which shall be a bank with an office in New York, New York, or
an Affiliate of any such bank which, so long as no Event of Default is
continuing, shall be reasonably acceptable to Borrower. Upon the acceptance of
its appointment as Agent hereunder by a successor, such successor shall succeed
to and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. The fees payable by Borrower to a successor Agent shall
be the same as those payable to its predecessor unless otherwise agreed between
Borrower and such successor. After the Agent's resignation hereunder, the
provisions of this Section 11 shall continue in effect for the benefit of such
retiring Agent, its sub-agents and their respective Related Parties in respect
of any actions taken or omitted to be taken by any of them while it was acting
as such Agent.
Each Lender acknowledges that it has, independently and
without reliance upon any Agent, Issuing Lender or any other Lender and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon any Agent,
Issuing Lender or any other Lender and based on such documents and information
as it shall from time to time deem appropriate, continue to make its own
decisions in taking or not taking action under or based upon this Agreement, any
related agreement or any document furnished hereunder or thereunder. No Agent or
Issuing Lender shall be deemed a trustee or other fiduciary on behalf of any
party.
11.02. Indemnification. Each Lender agrees to indemnify and
hold harmless each Agent and the Issuing Lender (to the extent not reimbursed
under Section 12.03, but without limiting the obligations of Borrower under
Section 12.03), ratably in accordance with the aggregate principal amount of the
respective Commitments of and/or Loans and Reimbursement Obligations held by the
Lenders (or, if all of the Commitments shall have been terminated or expired,
ratably in accordance with the aggregate outstanding amount of the Loans and
Reimbursement Obligations held by the Lenders), for any and all liabilities
(including pursuant to any Environmental Law), obligations, losses, damages,
penalties, actions, judgments, deficiencies, suits, costs, expenses (including
reasonable attorney's fees) or disbursements of any kind and nature whatsoever
that may be imposed on, incurred by or asserted against such Agent or Issuing
Lender (including by any Lender) arising out of or by reason of any
investigation in or in any way relating to or arising out of any Credit Document
or any other documents contemplated by or referred to therein for any action
taken or omitted to be taken by such Agent or Issuing Lender under or in respect
of any of the Credit Documents or other such documents or the transactions
contemplated thereby (including the costs and expenses that Borrower is
obligated to pay under Section 12.03, and including also any payments under any
indemnity that Administrative Agent is required to issue to any Lender referred
to in Section 4.01(c) of the Security Agreement or Section 4.01(c) of the
Unrestricted Subsidiary Pledge Agreement, or to any bank referred to in Section
4.02 of the Security Agreement to which remittances in respect of Accounts, as
defined therein, are to be made, but excluding, unless a Default has occurred
and is continuing, normal administrative costs and expenses incident to the
performance of its agency duties hereunder) or the enforcement of any of the
terms hereof or thereof or of any such other documents; provided, however, that
no Lender shall be liable for any of the foregoing to the extent they are
determined by a court of competent jurisdiction in a final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of the
party to be indemnified. The agreements set forth in this Section 11.02 shall
survive the payment of all Loans and other obligations hereunder and shall be in
addition to and not in lieu of any other indemnification agreements contained in
any other Credit Document.
11.03. Consents Under Other Credit Documents. Except as
otherwise provided in this Agreement and the other Credit Documents,
Administrative Agent may, with the prior consent of the Majority Lenders (but
not otherwise), consent to any modification, supplement or waiver under any of
the other Credit Documents.
11.04. Collateral Sub-Agents. Each Lender by its execution and
delivery of this Agreement agrees, as contemplated by Section 4.03 of the
Security Agreement, that, in the event it shall hold any Permitted Investments
referred to therein, such Permitted Investments shall be held in the name and
under the control of such Lender, and such Lender shall hold such Permitted
Investments as a collateral sub-agent for Administrative Agent thereunder.
Borrower by its execution and delivery of this Agreement hereby consents to the
foregoing.
Section 12. Miscellaneous.
12.01. Waiver. No failure on the part of any Creditor to
exercise and no delay in exercising, and no course of dealing with respect to,
any right, power or privilege under any Credit Document shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
privilege under any Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The remedies
provided herein are cumulative and not exclusive of any remedies provided by
law.
12.02. Notices. All notices, requests and other communications
provided for herein and under the Security Documents (including any
modifications of, or waivers, requests or consents under, this Agreement) shall
be given or made in writing (including by facsimile) delivered to the intended
recipient at the "Address for Notices" specified below its name on the signature
pages hereof (or as to any Guarantor, as so specified for Borrower) or, as to
any party, at such other address as shall be designated by such party in a
notice to each other party. Except as otherwise provided in this Agreement, all
such communications shall be deemed to have been duly given when transmitted by
facsimile or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid. Any Notice of Borrowing
or Notice of Continuation/Conversion shall be deemed to have been received when
actually received.
12.03. Expenses, Indemnification, Etc. (a) The Obligors,
jointly and severally, agree to pay or reimburse:
(i) the Issuing Lender, Syndication Agent and Administrative
Agent for all of their reasonable out-of-pocket costs and expenses
(including the reasonable fees and expenses of legal counsel) in
connection with (1) the negotiation, preparation, execution and
delivery of the Credit Documents and the extension of credit hereunder,
(2) the negotiation or preparation of any modification, supplement or
waiver of any of the terms of any Credit Document (whether or not
consummated or effective) and (3) the syndication of the Loans and
Commitments;
(ii) each of the Lenders, the Issuing Lender and
Administrative Agent for all reasonable out-of-pocket costs and
expenses of the Lenders, the Issuing Lender and Administrative Agent
(including the reasonable fees and expenses of legal counsel) in
connection with (1) any enforcement or collection proceedings resulting
from any Default, including all manner of participation in or other
involvement with (x) bankruptcy, insolvency, receivership, foreclosure,
winding up or liquidation proceedings, (y) judicial or regulatory
proceedings and (z) workout, restructuring or other negotiations or
proceedings (whether or not the workout, restructuring or transaction
contemplated thereby is consummated), (2) the enforcement of this
Section 12.03 and (3) any documentary taxes; and
(iii) Administrative Agent for all reasonable costs, expenses,
taxes, assessments and other charges incurred in connection with any
filing, registration, recording or perfection of any security interest
contemplated by any Credit Document or any other document referred to
therein.
(b) The Obligors, jointly and severally, hereby agree to
indemnify each Creditor and their respective Affiliates, directors, trustees,
officers, employees and agents (each, an "Indemnitee") from, and hold each of
them harmless against, and that no Indemnitee will have any liability for, any
and all Losses incurred by any of them (including any and all Losses incurred by
Administrative Agent, Syndication Agent or the Issuing Lender to any Lender,
whether or not any Creditor is a party thereto) directly or indirectly arising
out of or by reason of or relating to the negotiation, execution, delivery,
performance, administration or enforcement of any Credit Document, any of the
transactions contemplated by the Credit Documents, any breach by any Obligor of
any representation, warranty, covenant or other agreement contained in any of
the Credit Documents in connection with any of the Transactions, the use or
proposed use of any of the Loans or Letters of Credit, the issuance of or
performance under any Letter of Credit or the use of any collateral security for
the Loans (including the exercise by any Creditor of the rights and remedies or
any power of attorney with respect thereto and any action or inaction in respect
thereof), but excluding any such Losses to the extent finally determined by a
court of competent jurisdiction in a final and nonappealable judgment to have
arisen from the gross negligence or bad faith of the Indemnitee.
Without limiting the generality of the foregoing, the
Obligors, jointly and severally, will indemnify each Creditor and each other
Indemnitee from, and hold each Creditor and each other Indemnitee harmless
against, any Losses described in the preceding sentence arising under any
Environmental Law as a result of (A) the past, present or future operations of
any Company (or any predecessor in interest to any Company), (B) the past,
present or future condition of any site or facility owned, operated, leased or
used at any time by any Company (or any such predecessor in interest), or (C)
any Release or threatened Release of any Hazardous Materials at, on, under or
from any such site or facility, including any such Release or threatened Release
that shall occur during any period when any Creditor shall be in possession of
any such site or facility following the exercise by such Creditor of any of its
rights and remedies hereunder or under any of the Security Documents; provided,
however, that the indemnity hereunder shall be subject to the exclusions from
indemnification set forth in the preceding sentence.
To the extent that the undertaking to indemnify and hold
harmless set forth in this Section 12.03 or any other provision of any Credit
Document providing for indemnification is unenforceable because it is violative
of any law or public policy or otherwise, the Obligors, jointly and severally,
shall contribute the maximum portion that each of them is permitted to pay and
satisfy under applicable law to the payment and satisfaction of all indemnified
liabilities incurred by any of the Persons indemnified hereunder.
The Obligors also agree that no Indemnitee shall have any
liability (whether direct or indirect, in contract or tort or otherwise) for any
Losses to any Obligor or any Obligor's security holders or creditors resulting
from, arising out of, in any way related to or by reason of any matter referred
to in any indemnification or expense reimbursement provisions set forth in this
Agreement or any other Credit Document, except to the extent that any Loss is
determined by a court of competent jurisdiction in a final nonappealable
judgment to have resulted from the gross negligence or bad faith of such
Indemnitee.
The Obligors agree that, without the prior written consent of
Administrative Agent, Syndication Agent and the Majority Lenders which consent
shall not be unreasonably withheld, no Obligor will settle, compromise or
consent to the entry of any judgment in any pending or threatened Proceeding in
respect of which indemnification is reasonably likely to be sought under the
indemnification provisions of this Section 12.03 (whether or not any Indemnitee
is an actual or potential party to such Proceeding), unless such settlement,
compromise or consent includes an unconditional written release of each
Indemnitee from all liability arising out of such Proceeding and does not
include any statement as to an admission of fault, culpability or failure to act
by or on behalf of any Indemnitee and does not involve any payment of money or
other value by any Indemnitee or any injunctive relief or factual findings or
stipulations binding on any Indemnitee.
12.04. Amendments, Etc. (i) No provision of any Credit
Document may be amended, modified or supplemented except by an instrument in
writing signed by the Obligors party thereto and the Majority Lenders, or by the
Obligors party thereto and Administrative Agent acting with the written consent
of the Majority Lenders, and no provision of any Credit Document may be waived
except by an instrument in writing signed by the Obligors party thereto and the
Majority Lenders, or by the Obligors party thereto and Administrative Agent
acting with the written consent of the Majority Lenders; provided, however,
that:
(a) no amendment or waiver shall, unless by an instrument
signed by all of the Lenders or by Administrative Agent acting with the
written consent of each Lender (with Obligations directly affected in
the case of clause (I)): (I) extend the scheduled final maturity of any
Loan or Note, or extend the stated expiration date of any Letter of
Credit beyond the Revolving Credit Commitment Termination Date (it
being understood that the termination date of the Increased Facility
Amount, if part of the Revolving Credit Facility, may be a date later
than the Revolving Credit Commitment Termination Date without requiring
the consent of each Lender), or reduce the rate of interest (other than
any waiver of any increase in the interest rate applicable to any of
the Loans pursuant to clause (b) of Section 3.02) or fees thereon, or
extend the time of payment of interest or fees thereon, or reduce the
principal amount thereof, or make any change to the definition of
Applicable Margin or Applicable Revolving Credit Fee Percentage, (II)
extend the final maturity of any of the Commitments (or reinstate any
Commitment terminated pursuant to Section 10) (it being understood that
the addition of the Increased Facility Amount with a longer maturity by
itself shall not be deemed to be an extension of a Commitment that is
required of each Lender), (III) change the currency in which any
Obligation is payable, (IV) amend the terms of this Section 12.04 or
Section 4.07, 5 or 11.03, (V) reduce the percentages specified in the
definition of the term "Majority Lenders" or "Supermajority Lenders" or
amend any provision of any Credit Document requiring the consent of all
the Lenders or reduce any other percentage of the Lenders required to
make any determinations or waive any rights hereunder or to modify any
provision hereof (it being understood that, the Increased Facility
Amount, if extended by any Lender, shall be, and with the consent of
the Majority Lenders, other additional extensions of credit pursuant to
this Agreement may be, included in the determination of the Majority
Lenders and Supermajority Lenders without notice to or consent of any
other Lender or Agent on substantially the same basis as the
Commitments (and related extensions of credit) are included on the
Closing Date), (VI) release any Guarantor from its obligations under
Section 6 (unless permitted by this Agreement), (VII) consent to the
assignment or transfer by any Obligor of any of its rights and
obligations under any Credit Document, (VIII) release all or
substantially all the Collateral or terminate the Lien under any Credit
Document in respect of all or substantially all the Collateral (except
as permitted by the Credit Documents) or agree to additional
obligations (other than the Obligations and the Increased Facility
Amount) being secured by the Collateral, (IX) waive the requirement
that nine and twelve month LIBOR interest periods require the consent
of all Lenders or (X) amend Section 12.03 or any other indemnification
and expense reimbursement provision set forth in any Credit Document
(it being understood that any prepayment required by Section 2.10(a)
may be waived or amended by the Majority Lenders);
(b) no such amendment or waiver shall increase the Commitments
of any Lender over the amount thereof then in effect without the
consent of such Lender (it being understood that amendments or waivers
of conditions precedent, covenants or Defaults shall not constitute an
increase of the Commitment of any Lender);
(c) any modification or supplement of or waiver with respect
to Section 11 which affects any Agent in their respective capacities as
such shall require the consent of such Agent;
(d) no consent of any Lender need be obtained, and
Administrative Agent is hereby authorized, to release any Lien securing
the Obligations on Property which is the subject of any disposition
permitted by the Credit Documents and to release any Guarantee of a
Subsidiary upon the sale of all of the Equity Interests of such
Subsidiary in accordance with the Credit Documents;
(e) subject to clause (a)(I) above of this proviso to this
Section 12.04(i), (x) the consent of all of the Lenders of the Term
Loan Tranche affected as well as the Supermajority Lenders shall be
required with respect to any extension of any scheduled Amortization
Payment or any reduction in the amount of any scheduled Amortization
Payment and (y) the consent of all Revolving Credit Lenders and the
Supermajority Lenders shall be required with respect to any change in
Section 2.04 (ii) that would result in an increase in any amount under
the column "Remaining Amount" (other than solely by addition of the
Increased Facility Amount) (it being understood that, subject to clause
(f) below of this Section 12.04, any prepayment required by Section
2.10 (and any corresponding reduction of the Revolving Credit
Commitments) may be modified, supplemented or waived by the Majority
Lenders);
(f) no modification, supplement or waiver shall, unless by an
instrument signed by the Supermajority Lenders of the Affected Class or
by Administrative Agent acting with the written consent of the
Supermajority Lenders of the Affected Class, change the timing of the
receipt or the application of mandatory prepayments hereunder as among
the Tranche A Term Loans, the Tranche B Term Loans and the Tranche C
Term Loans or the order in which any such prepayment is applied to the
Tranche A Term Loans, Tranche B Term Loans or Tranche C Term Loans
(although any required prepayment set forth in Section 2.10 may
otherwise be modified, supplemented or waived by the Majority Lenders);
provided, however, that if the Increased Facility Amount is extended as
a new term loan facility, such new term loan facility may be treated on
the same terms (including pro rata application of prepayments) as the
Tranche A Term Loans, the Tranche B Term Loans and the Tranche C Term
Loans without such consent;
(g) no reduction of the percentage specified in the definition
of "Majority Revolving Credit Lenders," "Majority Tranche A Term Loan
Lenders," "Majority Tranche B Term Loan Lenders" or "Majority Tranche C
Term Loan Lenders" shall be made without the consent of each Revolving
Credit Lender, each Tranche A Term Loan Lender, each Tranche B Term
Loan Lender or each Tranche C Term Loan Lender, respectively (it being
understood that only the Class of such Loan to which such definition
relates need consent to any such reduction and that the Increased
Facility Amount, if extended by any Lender, shall be, and, with the
consent of the Majority Lenders, other additional extensions of credit
pursuant to this Agreement may be, included in any such definition
without notice to or consent of any other Lender or Agent on
substantially the same terms as the Commitments (and related extensions
of credit) are included on the Closing Date);
(h) no reduction of the percentage specified in the definition
of (I) "Majority Term Lenders" shall be made without the consent of the
Majority Tranche A Term Loan Lenders, the Majority Tranche B Term Loan
Lenders and the Majority Tranche C Term Loan Lenders or (II)
"Supermajority Lenders of the Affected Class" shall be made without the
consent of each Term Loan Lender (it being understood, that the
Increased Facility Amount, if extended by any Lender, shall be, and,
with the consent of the Majority Lenders, additional extensions of
credit pursuant to this Agreement may be, included in either such
definition without notice to or consent of any other Lender or Agent on
substantially the same terms as the Commitments (and related extensions
of credit) are included on the Closing Date);
(i) no amendment or waiver shall make any change to Section
2.01(f) or the definitions of "Swing Loan Commitment," "Swing Loan
Maturity Date" or "Swing Loans" or the Swing Loan Note without the
consent of the Swing Loan Lender;
(j) no amendment or waiver shall affect the rights or duties
of the Issuing Lender in its capacity as such or alter the obligation
of any Revolving Credit Lender pursuant to Section 2.03(e) or 2.03(f)
without the consent of the Issuing Lender;
(k) no consent of any Lender need be obtained to effect any
amendment of any Credit Document necessary to comply with Section 9.12
or Section 9.20; and
(l) no amendment, modification, supplement or waiver may be
made to any condition precedent to any extension of credit under the
Revolving Credit Facility set forth in subsection 7.02 without the
written consent of the Majority Revolving Credit Lenders, it being
understood that no amendment to or waiver of any representation or
warranty or any covenant contained in this Agreement or any other
Credit Document, or of any Default, shall be deemed to be effective for
purposes of determining whether the conditions precedent set forth in
subsection 7.02 to the making of any extension of credit under the
Revolving Credit Loans have been satisfied unless the Majority
Revolving Credit Lenders shall have consented to such amendment or
waiver.
(ii) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by Section 12.04(i)(a) (other than clause (I) of such section), the
consent of the Majority Lenders is obtained but the consent of one or more of
such other Lenders whose consent is required is not obtained, then Borrower
shall have the right to replace each such non-consenting Lender or Lenders (so
long as all non-consenting Lenders are so replaced) with one or more Replacement
Lenders pursuant to Section 2.11 so long as at the time of such replacement each
such Replacement Lender consents to the proposed change, waiver, discharge or
termination; provided, however, that Borrower shall not have the right to
replace a Lender solely as a result of the exercise of such Lender's rights (and
the withholding of any required consent by such Lender) pursuant to clause (I)
of Section 12.04(i)(a).
12.05. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
12.06. Assignments and Participations. (a) No Obligor may
assign its respective rights or obligations hereunder or under the Notes or any
other Credit Document without the prior written consent of all of the Lenders.
(b) Each Lender may assign to any Eligible Person any of its
Loans, its Notes, its Letter of Credit Interests and its Commitments (but only
with the consent (which shall not be unreasonably withheld, delayed or
conditioned) of Borrower and Arrangers and, in the case of the Revolving Credit
Commitments, the Issuing Lender); provided, however, that (i) no such consent by
Borrower, the Issuing Lender or Arrangers shall be required in the case of any
assignment to another Lender or any Lender's Affiliate or an Approved Fund of
any Lender (in which case, the assignee and assignor Lenders shall give notice
of the assignment to Arrangers); (ii) no consent of Borrower or Arrangers need
be obtained if any Event of Default shall have occurred and be continuing; (iii)
each assignment, other than to a Lender or any Lender's Affiliate or an Approved
Fund of any Lender and other than any assignment effected by Merrill Lynch
Capital Corporation or Toronto Dominion (Texas), Inc. or any of their respective
Affiliates in connection with the syndication of the Commitments and/or Loans,
shall be in an aggregate amount at least equal to $5.0 million unless the
assigning Lender's exposure is reduced to $0 or unless Borrower and Arrangers
otherwise agree and (iv) in no event may any such assignment be made to any
Obligor or any of its Affiliates without consent of all Lenders. Any assignment
of a Loan shall be effective only upon appropriate entries with respect thereto
being made in the Register (and each Note shall expressly so provide). Any
assignment or transfer of a Loan shall be registered on the Register only upon
surrender for registration of assignment or transfer of the Note evidencing such
Loan (if a Note was issued in respect thereof), accompanied by an instrument in
writing substantially in the form of Exhibit F, and upon consent thereto by
Borrower, Arrangers and the Issuing Lender to the extent required above (none of
which consents to be unreasonably withheld), one or more new Notes (if requested
by the New Lender) in the same aggregate principal amount shall be issued to the
designated assignee and the old Notes shall be returned by Administrative Agent
to Borrower marked "cancelled". Upon execution and delivery by the assignee to
Borrower and Arrangers of an instrument in writing substantially in the form of
Exhibit F, and upon consent thereto by Borrower, Arrangers and the Issuing
Lender to the extent required above (none of which consents to be unreasonably
withheld), and in the case of a Loan, upon appropriate entries being made in the
Register the assignee shall have, to the extent of such assignment (unless
otherwise provided in such assignment with the consent of Administrative Agent),
the obligations, rights and benefits of a Lender hereunder holding the
Commitment(s), Loans (or portions thereof) and Letter of Credit Interests
assigned to it (in addition to the Commitment(s), Letter of Credit Interests and
Loans, if any, theretofore held by such assignee) and the assigning Lender
shall, to the extent of such assignment, be released from the Commitment(s) (or
portion(s) thereof) so assigned. Upon any such assignment (other than to a
Lender or any Affiliate of a Lender or any Approved Fund and other than any
assignment by Merrill Lynch Capital Corporation or any of its Affiliates) the
assignee Lender shall pay a fee of $3,500 to Administrative Agent. Upon any such
assignment, certain rights and obligations of the assigning Lender shall survive
as set forth in Section 12.07. Each assignment shall be made pursuant to an
agreement substantially in the form of Exhibit L.
(c) A Lender may sell or agree to sell to one or more other
Persons a participation in all or any part of any Loans and Letter of Credit
Interests held by it, or in its Commitments, in which event each purchaser of a
participation (a "Participant") shall be entitled to the rights and benefits of
the provisions of Section 5 (provided, however, that no Participant shall be
entitled to receive any greater amount pursuant to Section 5 than the transferor
Lender would have been entitled to receive in respect of the participation
effected by such transferor Lender had no participation occurred) with respect
to its participation in such Loans, Letter of Credit Interests and Commitments
as if such Participant were a "Lender" for purposes of said Section, but, except
as otherwise provided in Section 4.07(c), shall not have any other rights or
benefits under this Agreement or any Note or any other Credit Document (the
Participant's rights against such Lender in respect of such participation to be
those set forth in the agreements executed by such Lender in favor of the
Participant). All amounts payable by Borrower to any Lender under Section 5 in
respect of Loans, Letter of Credit Interests and its Commitments shall be no
greater than the amount that would have applied if such Lender had not sold or
agreed to sell any participation in such Loans, Letter of Credit Interests and
Commitments, and as if such Lender were funding each of such Loan, Letter of
Credit Interests and Commitments in the same way that it is funding the portion
of such Loan, Letter of Credit Interests and Commitments in which no
participations have been sold. In no event shall a Lender that sells a
participation agree with the Participant to take or refrain from taking any
action hereunder or under any other Credit Document, except that such Lender may
agree with the Participant that it will not, without the consent of the
Participant, agree to any modification or amendment set forth in subclauses (I),
(II), (III) or (VIII) of clause (a) of the proviso to Section 12.04.
(d) In addition to the assignments and participations
permitted under the foregoing provisions of this Section 12.06, any Lender may
assign and pledge all or any portion of its Loans and its Notes to any United
States Federal Reserve Bank as collateral security pursuant to Regulation A of
the Board of Governors of the Federal Reserve System and any Operating Circular
issued by such Federal Reserve Bank and, in the case of a Lender that is an
investment fund, any such Lender may assign or pledge all or any portion of its
Loans and its Notes to its trustee in support of its obligations to its trustee,
without notice to or consent of Borrower, Administrative Agent, Arrangers or
Issuing Lender. No such assignment shall release the assigning Lender from its
obligations hereunder.
(e) A Lender may furnish any information concerning any
Company in the possession of such Lender from time to time to assignees and
participants (including prospective assignees and participants) subject,
however, to and so long as the recipient agrees in writing to be bound by the
provisions of Section 12.11. In addition, each of Administrative Agent and
Syndication Agent may furnish any information concerning any Obligor or any of
its Affiliates in Administrative Agent's or Syndication Agent's possession to
any Affiliate of Administrative Agent or Syndication Agent, subject, however, to
the provisions of Section 12.11. The Obligors shall assist any Lender in
effectuating any assignment or participation pursuant to this Section 12.06
(including during syndication) in whatever manner such Lender reasonably deems
necessary, including participation in meetings with prospective transferees.
12.07. Survival. The obligations of the Obligors under
Sections 5.01, 5.05, 5.06 and 12.03, the obligations of each Guarantor under
Section 6.03, and the obligations of the Lenders under Sections 5.06 and 11.02,
shall survive the repayment of the Loans and Reimbursement Obligations and the
termination of the Commitments and, in the case of any Lender that may assign
any interest in its Commitments, Loans or Letter of Credit Interest hereunder,
shall (to the extent relating to such time as it was a Lender) survive the
making of such assignment, notwithstanding that such assigning Lender may cease
to be a "Lender" hereunder. In addition, each representation and warranty made,
or deemed to be made by a notice of any extension of credit, herein or pursuant
hereto shall be considered to have been relied upon by the other parties hereto
and shall survive the execution and delivery of this Agreement and the Notes and
the making of any extension of credit hereunder, regardless of any investigation
made by any such other party or on its behalf and notwithstanding that
Administrative Agent or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty and regardless of whether any
such representation or warranty under the Merger Agreement survives the Mergers.
12.08. Captions. The table of contents and captions and
section headings appearing herein are included solely for convenience of
reference and are not intended to affect the interpretation of any provision of
this Agreement.
12.09. Counterparts; Interpretation; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement and
any separate letter agreements with respect to fees payable to Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof, other than the
indemnity, confidentiality, waiver of jury trial and governing law provisions of
the Commitment Letter, which are not superseded and survive. Except as provided
in Section 7.01, this Agreement shall become effective when it shall have been
executed by Administrative Agent and when Administrative Agent shall have
received counterparts hereof which, when taken together, bear the signatures of
each of the other parties hereto, and thereafter shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns. Delivery of an executed counterpart of a signature page of this
Agreement by telecopy shall be effective as delivery of a manually executed
counterpart of this Agreement.
12.10. Governing Law; Submission to Jurisdiction; Waivers;
Etc. Each Credit Document shall be governed by, and construed in accordance
with, the law of the State of New York, without regard to the principles of
conflicts of laws thereof (except in the case of the other Credit Documents, to
the extent otherwise expressly stated therein). Each Obligor hereby irrevocably
and unconditionally: (I) submits for itself and its Property in any Proceeding
relating to any Credit Document to which it is a party, or for recognition and
enforcement of any judgment in respect thereof, to the non-exclusive general
jurisdiction of the Supreme Court of the State of New York sitting in New York
County, the courts of the United States of America for the Southern District of
New York, and appellate courts from any thereof; (II) consents that any such
Proceeding may be brought in any such court and waives trial by jury and any
objection that it may now or hereafter have to the venue of any such Proceeding
in any such court or that such Proceeding was brought in an inconvenient court
and agrees not to plead or claim the same; (III) agrees that service of process
in any such Proceeding may be effected by mailing a copy thereof by registered
or certified mail (or any substantially similar form of mail), postage prepaid,
to Borrower at its address set forth in Section 12.02 or at such other address
of which Administrative Agent shall have been notified pursuant thereto; and
(IV) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction.
12.11. Confidentiality. Each Lender agrees to keep
confidential information obtained by it pursuant hereto and the other Credit
Documents confidential in accordance with such Lender's customary practices and
agrees that it will only use such information in connection with the
transactions contemplated by this Agreement and not disclose any of such
information other than (a) to such Lender's employees, representatives,
directors, attorneys, auditors, agents, professional advisors, trustees or
affiliates who are advised of the confidential nature of such information or to
any direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty agrees to
be bound by the provision of this Section 12.11), (b) to the extent such
information presently is or hereafter becomes available to such Lender on a
non-confidential basis from any source of such information that is in the public
domain at the time of disclosure, (c) to the extent disclosure is required by
law (including applicable securities laws), regulation, subpoena or judicial
order or process (provided that notice of such requirement or order shall be
promptly furnished to Borrower unless such notice is legally prohibited) or
requested or required by bank, securities, insurance or investment company
regulations or auditors or any administrative body or commission (including the
Securities Valuation Office of the National Association of Insurance
Commissioners) to whose jurisdiction such Lender may be subject, (d) to any
rating agency to the extent required in connection with any rating to be
assigned to such Lender, (e) to assignees or participants or prospective
assignees or participants who agree to be bound by the provisions of this
Section 12.11, (f) to the extent required in connection with any litigation
between any Obligor and any Lender with respect to the Loans or this Agreement
and the other Credit Documents or (g) with Borrower's prior written consent.
12.12. Independence of Representations, Warranties and
Covenants. The representations, warranties and covenants contained herein shall
be independent of each other and no exception to any representation, warranty or
covenant shall be deemed to be an exception to any other representation,
warranty or covenant contained herein unless expressly provided, nor shall any
such exception be deemed to permit any action or omission that would be in
contravention of applicable law. Notwithstanding anything herein to the
contrary, any matter identified on a Schedule to this Agreement shall be deemed
to be set forth on all other Schedules to this Agreement for purposes of
determining compliance with any of the representations, warranties or covenants
contained herein.
12.13. Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provisions or the remaining provisions of this Agreement.
12.14. Acknowledgments. The Obligors hereby acknowledge that:
(a) each of them has been advised by counsel in connection with the negotiation,
execution and delivery of the Credit Documents; (b) no Creditor has any
fiduciary or similar relationship to any Obligor and the relationship between
the Creditors on the one hand, and the Obligors, on the other hand, is solely
that of debtor and creditor; and (c) no joint venture exists among the Creditors
or among the Obligors and the Creditors.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year first above
written.
AMERICAN CELLULAR WIRELESS LLC
By: /s/ James J. Walter
--------------------------------
Name: James J. Walter
Title:
Address for Notices:
1336 Basswood, Suite F
Schaumburg, IL 60173
Contact Person: James Walter, Jr.
Telecopier No.: (847) 843-9091
Telephone No.: (847) 843-9081
GUARANTORS:
AMERICAN CELLULAR
CORPORATION CONNECTONE
COMMUNICATIONS CORPORATION
PCPCS CORPORATION
ICSB CORPORATION
ALTON CELLTELCO CELLULAR CORPORATION
ALEXANDRA CELLULAR CORPORATION
AMRO CELLULAR CORPORATION
BUNYON CELLULAR CORPORATION
CELLULAR INFORMATION SYSTEMS OF
LAREDO, INC.
CENTRAL KENTUCKY CELLULAR CORPORATION
CHILL CELLULAR CORPORATION
CHIPPEWA CELLULAR CORPORATION
DUTCHESS COUNTY CELLULAR
TELEPHONE COMPANY, INC.
DULUTH/SUPERIOR CELLULAR, INC.
EASTERN WIRELESS CELLULAR CORPORATION
FIVE CELLULAR CORPORATION
FOUR CELLULAR CORPORATION
GILRO CELLULAR CORPORATION
JESSICA CELLULAR CORPORATION
KYLE CELLULAR CORPORATION
MARATHON CELLULAR CORPORATION
MINNESOTA SIX CELLULAR CORPORATION
NORTHLAND CELLULAR CORPORATION
ONE CELLULAR CORPORATION
PEBBLES CELLULAR CORPORATION
SEVEN CELLULAR CORPORATION
THREE CELLULAR CORPORATION
VILAS CELLULAR CORPORATION
WAUSAU CELLULAR LICENSE CORPORATION
By: /s/ James J. Walter
--------------------------------
Name:
Title:
ALTON CELLTELCO PARTNERSHIP
By: Alton CellTelCo Corporation,
a general partner
By: /s/ James J. Walter
---------------------------------
Name:
Title:
WAUSAU CELLULAR LIMITED PARTNERSHIP
By: American Cellular Wireless LLC,
as the general partner
By: /s/ James J. Walter
--------------------------------
Name:
Title:
TORONTO DOMINION (TEXAS), INC.,
as Administrative Agent, Issuing
Lender and as a Lender
By: /s/ Neva Nesbitt
--------------------------------
Name: Neva Nesbitt
Title: Vice President
Address for Notices:
909 Fannin Street, Suite 1700
Houston, Texas 77010
Attention: Ms. Neva Nesbitt
Telecopier No.: (713) 951-9921
Telephone No.: (713) 653-8235
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER
& SMITH INCORPORATED,
as Syndication Agent
By: /s/ Sheila McGillicuddy
--------------------------------
Name: Sheila McGillicuddy
Title: Director
Address for Notices:
World Financial Center
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner
& Smith Incorporated
South Tower
225 Liberty Street
New York, New York 10080-6114
Attention:
Telecopier No.: (212) 449-8230
Telephone No.: (212) 449-8221
LENDERS
MERRILL LYNCH CAPITAL CORPORATION,
as a Lender
By: /s/ Sheila McGillicuddy
--------------------------------
Name: Sheila McGillicuddy
Title: Director
Lending Office for all Loans:
World Financial Center
c/o Merrill Lynch & Co.
North Tower - 7th Floor
250 Vesey Street
New York, New York 10281-1307
Address for Notices:
World Financial Center
c/o Merrill Lynch & Co.
North Tower
250 Vesey Street
New York, New York 10281-1316
Attention: Peter Wersching
Telecopier No.: (212) 449-4972
Telephone No.: (212) 449-9435
ALLSTATE LIFE INSURANCE COMPANY,
as a Lender
By: /s/ Dorothy E. Ever
--------------------------------
Name: Dorothy E. Ever
Title:
By: /s/ R.M.
--------------------------------
Name:
Title:
Lending Office for all Loans:
Allstate Insurance Company
Investment Operations -
Private Placements
3075 Sonders Road, STE G4A
Northbrook, IL 60062
Address for Notices:
Allstate Life Insurance Company
3075 Sonders Road, STE G3A
Northbrook, IL 60062
Attention: Private Placements
Department
Telecopier No.: 847-402-3092
Telephone No.: 847-402-4394
ALLSTATE INSURANCE COMPANY,
as a Lender
By: /s/ Dorothy E. Ever
--------------------------------
Name: Dorothy E. Ever
Title:
By: --------------------------------
Name:
Title:
Lending Office for all Loans:
Allstate Insurance Company
Investment Operations -
Private Placements
3075 Sonders Road, STE G4A
Northbrook, IL 60062
Address for Notices:
Allstate Life Insurance Company
3075 Sonders Road, STE G3A
Northbrook, IL 60062
Attention: Private Placements
Department
Telecopier No.: 847-402-3092
Telephone No.: 847-402-4394
BALANCED HIGH-YIELD FUND I LTD.,
By: BHF-BANK Aktiengesellschaft
acting through its New York
Branch as attorney-in-fact,
as a Lender
By: /s/ Linda Pace
--------------------------------
Name: Linda Pace
Title: Vice President
By: /s/ John Sykes
--------------------------------
Name: John Sykes
Title: Vice President
Lending Office for all Loans:
State Street Bank & Trust Co.
Two International Place
Boston, MA 02110
Address for Notices:
Balanced High-Yield Fund I Ltd.
c/o BHF-BANK AG
590 Madison Avenue, 30th Floor
New York, New York 10022
Attention: Linda Pace
Telecopier No.: 212-756-5536
Telephone No.: 212-756-5915
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as a Lender
By: /s/ R. Vernon Howard, Jr.
--------------------------------
Name: R. Vernon Howard, Jr.
Title: Managing Director
Lending Office for all Loans:
Bank of America NT & SA
1850 Gateway Blvd., 3rd Floor
Concord, CA 94520
Attention: John Sanchez
Telecopier No.: 925-603-7256
Telephone No.: 925-675-7331
Address for Notices:
Bank of America NT & SA 555
California St., 41st Floor
San Francisco, CA 94104
Attention: R. Vernon Howard, Jr.
Telecopier No.: 415-622-0632
Telephone No.: 415-953-0590
BARCLAYS BANK PLC,
as a Lender
By: /s/ Les Bek
--------------------------------
Name: Les Bek
Title: Director
Lending Office for all Loans:
Barclays Bank PLC
222 Broadway
New York, NY 10265
Attention: CSU
Address for Notices:
Barclays Capital
388 Market Street
Suite 1700
San Francisco, CA 94111
Attention: Les Bek
Telecopier No.: 415-765-4760
Telephone No.: 415-765-4701
BHF-BANK AKTIENGESELLSCHAFT,
as a Lender
By: /s/ Linda Pace
--------------------------------
Name: Linda Pace
Title: Vice President
By: /s/ John Sykes
--------------------------------
Name: John Sykes
Title: Vice President
Lending Office for all Loans:
BHF-BANK AG, Grand Cayman Branch
c/o 590 Madison Avenue
New York, NY 10022
Address for Notices:
BHF-BANK AG
590 Madison Avenue
New York, NY 10002
Attention: Linda Pace
Telecopier No.: 212-756-5536
Telephone No.: 212-756-5915
COBANK, ACB,
as a Lender
By: /s/ Alan D. Hack
--------------------------------
Name: Alan D. Hack
Title: Vice President
Lending Office for all Loans:
CoBank, ACB
ATTN: Alan Hack
101 Bullitt Lane, Suite 304
Louisville, KY 40222-5495
Address for Notices:
CoBank, ACB
P.O. Box 5110
Denver, CO 80217
Telecopier No.: 303-740-4002
Telephone No.: 303-740-4000
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A.,
"RABOBANK NEDERLAND",
NEW YORK BRANCH,
as a Lender
By: /s/ Ian Reece
-------------------------------
Name: Ian Reece
Title: Senior Credit Officer
By: /s/ Angela R. Reilly
-------------------------------
Name: Angela R. Reilly
Title: Vice President
Lending Office and Address
for Notices:
245 Park Avenue
New York, NY 10167
Attention: Corporate Services
Department
Telecopier No.: 212-818-0233
Telephone No.: 212-916-7800
With a copy to:
Rabobank Nederland
300 South Wacker Drive
Suite 3500
Chicago, IL 60606
Attention: Alan McLintock
Wire Transfer Instructions:
Bank of New York
ABA No. 021000018
A/C Rabobank New York
A/C No. 802 6002533
Re: American Wireless
CREDIT LYONNAIS NEW YORK BRANCH,
as a Lender
By: /s/ Michael Henderlong
-------------------------------
Name: Michael Henderlong
Title: Vice President
Lending Office for all Loans:
1301 Avenue of the Americas
New York, NY 10019
Attention: Gerri Bauerle
Address for Notices:
1301 Avenue of the Americas
New York, NY 10019
Attention: Gerri Bauerle
Telecopier No.:
Telephone No.:
CYPRESSTREE INVESTMENT MANAGEMENT
COMPANY, INC.
As: Attorney-in-Fact and on behalf
of First Allmerica Financial Life
Insurance Company
As Portfolio Manager,
as a Lender
By: /s/ Joseph A. Germain
-------------------------------
Name: Joseph A. Germain
Title: Principal
Lending Office for all Loans:
CypressTree Investment Management
Company, Inc.
125 High Street, 14th Floor
Boston, MA 02110
Address for Notices:
125 High Street, 14th Floor
Boston, MA 02110
Attention: Larry Grantham
Telecopier No.: 617-946-5687
Telephone No.: 617-946-0600
CYPRESSTREE INVESTMENT MANAGEMENT
COMPANY, INC.
As: Attorney-in-Fact and on behalf
of First Allmerica Financial Life
Insurance Company As Portfolio
Manager, as a Lender
By: /s/ Timothy M. Bams
-------------------------------
Name: Timothy M. Barns
Title: Managing Director
Lending Office for all Loans:
CypressTree Investment Management
Company, Inc.
125 High Street, 14th Floor
Boston, MA 02110
Address for Notices:
125 High Street, 14th Floor
Boston, MA 02110
Attention: Larry Grantham
Telecopier No.: 617-946-5687
Telephone No.: 617-946-0600
THE FIRST NATIONAL BANK OF MARYLAND,
as a Lender
By: /s/ Timothy A. Knabe
-------------------------------
Name: Timothy A. Knabe
Title: Vice President
Lending Office for all Loans:
The First National Bank of Maryland
25 S. Charles Street (18th Floor)
Baltimore, MD 21201
Attention: Timothy A. Knabe
Address for Notices:
The First National Bank of Maryland
25 S. Charles Street (18th Floor)
Baltimore, MD 21201
Attention: Darla Holbrook
Telecopier No.: 410-244-4920
Telephone No.: 410-244-4051
FIRST UNION NATIONAL BANK,
as a Lender
By: /s/ J.H.
-------------------------------
Name:
Title:
Lending Office for all Loans:
Address for Notices:
Telecopier No.:
Telephone No.:
FLEET NATIONAL BANK,
as a Lender
By: /s/ Tanya M. Crossley
-------------------------------
Name: Tanya M. Crossley
Title: Vice President
Lending Office for all Loans:
1185 Avenue of the Americas
16th Floor, Mailstop: NYNYS16K
New York, NY 10036
Address for Notices:
1185 Avenue of the Americas
16th Floor
New York, NY 10036
Attention: Yin Lee or Ann Platek
Telecopier No.: 212-819-6204
Telephone No.: 212-819-6052/6053
FRANKLIN FLOATING RATE TRUST,
as a Lender
By: /s/ Chauncey Lufkin
-------------------------------
Name: Chauncey Lufkin
Title: Vice President
Lending Office for all Loans:
Franklin Floating Rate Trust
777 Mariners Island Boulevard, 3rd Floor
San Mateo, CA 94404
Address for Notices:
Franklin Floating Rate Trust
777 Mariners Island Boulevard, 3rd Floor
San Mateo, CA 94404
Attention: Matt Gregory
Telecopier No.: 650-312-3346
Telephone No.: 650-312-3309
GENERAL ELECTRIC CAPITAL CORPORATION,
as a Lender
By: /s/ Molly Fergusson
-------------------------------
Name: Molly Fergusson
Title: Manager, Operations
Lending Office for all Loans:
General Electric Capital Corporation
120 Long Ridge Road
3rd Floor
Stamford, CT 06927
Address for Notices:
General Electric Capital Corporation
120 Long Ridge Road
3rd Floor
Stamford, CT 06927
Attention: Susan Cahill
Telecopier No.: 203-425-9327
Telephone No.: 203-961-2032
ING HIGH INCOME PRINCIPAL PRESERVATION
FUND HOLDINGS, LDC
BY: ING CAPITAL ADVISORS, INC.,
AS INVESTMENT ADVISOR,
as a Lender
By: /s/ Jane Musser Nelson
-------------------------------
Name: Jane Musser Nelson
Title: Senior Vice President,
Portfolio Manager
Lending Office for all Loans:
ING Capital Advisors, Inc.
233 South Wacker Drive, Suite 5200
Chicago, IL 60606
Attention: Jane Musser Nelson
Senior Vice President
Portfolio Manager
Address for Notices:
ING Capital Advisors, Inc.
333 South Grand Avenue, Suite 4250
Los Angeles, CA 90071
Attention: Lenore Y. Crummey-Benoit
Vice President
Telecopier No.: 213-626-6552
Telephone No.: 213-346-3976
KZH HOLDING CORPORATION III,
as a Lender
By: /s/ Virginia Conway
-------------------------------
Name: Virginia Conway
Title: Authorized Agent
Lending Office for all Loans:
Address for Notices:
Telecopier No.:
Telephone No.:
ML CLO XIX STERLING (CAYMAN) LTD.,
By: STERLING ASSET MANAGER, L.L.C.,
AS ITS INVESTMENT ADVISOR
as a Lender
By: /s/ Louis Pistecchia
-------------------------------
Name: Louis Pistecchia
Title: Executive Vice President
Lending Office for all Loans:
ML CLO XIX Sterling (Cayman) Ltd.
c/o Sterling Asset Manager, L.L.C.
40 Fulton Street, 10th Floor
New York, NY 10038
Contact: Rafael Scolari
Phone: 212-406-3499
Facsimile: 212-406-3710
Contact: Louis Pistecchia
Phone: 212-406-3609
Facsimile: 212-406-3710
Address for Notices:
ML CLO XIX Sterling (Cayman) Ltd.
c/o Sterling Asset Manager, L.L.C.
40 Fulton Street, 10th Floor
New York, NY 10038
Attention:: Elizabeth Bodisch
Phone: 212-406-3607
Facsimile: 212-406-3710
AND
State Street Bank and Trust Company
Corporate Trust Department
2 International Place
Boston, MA 02110
Contact: Steve O'Brian
Phone: 617-664-5296
Facsimile: 617-664-5367
MERCANTILE BANK NATIONAL ASSOCIATION,
as a Lender
By: /s/ Michael J. Homeyer
-------------------------------
Name: Michael J. Homeyer
Title: Banking Officer
Lending Office for all Loans:
Mercantile Bank National Association
One Mercantile Center
7th & Washington, 12-3
St. Louis, MO 63101
Address for Notices:
Mercantile Bank National Association
One Mercantile Center
7th & Washington, 12-3
St. Louis, MO 63101
Attention: Michael Homeyer
Telecopier No.: 314-418-8292
Telephone No.: 314-418-8129
NATIONAL WESTMINISTER BANK PLC,
By: NatWest Capital Markets
Limited, its agent
By: Greenwich Capital Markets,
Inc., its agent
By: /s/ Jeremy Hood
------------------------------
Name: Jeremy Hood
Title: Vice President
Lending Office for all Loans:
National Westminister Bank PLC
c/o Greenwich Capital Markets, Inc.
600 Steamboat Road
Greenwich, CT 06830
Attention: Rick Jacoby
Phone: 203-618-2510
Facsimile: 203-618-2520
Address for Notices:
National Westminister Bank PLC
c/o Greenwich Capital Markets, Inc.
600 Steamboat Road
Greenwich, CT 06830
Attention: Rick Jacoby
Phone: 203-618-2510
Facsimile: 203-618-2520
NATIONSBANK, N.A.,
as a Lender
By: /s/ Julie A. Schell
------------------------------
Name: Julie A. Schell
Title: Vice President
Lending Office for all Loans:
901 Main Street, 14th Floor
Dallas, Texas 75202
Address for Notices:
901 Main Street, 64th Floor
Dallas, Texas 75202-3748
Attention: Jennifer Zydney
Telecopier No.: 214-508-9390
Telephone No.: 214-508-2752
PARIBAS,
as a Lender
By: /s/ Salo Aizenberg
------------------------------
Name: Salo Aizenberg
Title: Vice President
By: /s/ Lynne S. Randall
------------------------------
Name: Lynne S. Randall
Title: Director
Lending Office for all Loans:
PARIBAS
Address for Notices:
787 Seventh Avenue
New York, NY 10019
Atention: Salo Aizenberg
Telecopier No.: 212-841-2119
Telephone No.: 212-841-2369
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ John T. Wilden
------------------------------
Name: John T. Wilden
Title: Vice President
Lending Office for all Loans:
PNC Bank, National Association
Media and Communications Finance
1600 Market Street
Philadelphia, PA 19103
F2-F070-21-1
Address for Notices:
PNC Bank, National Association
Media and Communications Finance
1600 Market Street
Philadelphia, PA 19103
Attention: John T. Wilden
Telecopier No.: 215-585-6680
Telephone No.: 215-585-4326
RIGGS BANK, N.A.,
as a Lender
By: /s/ Jeffrey White
------------------------------
Name: Jeffrey White
Title: Vice President
Lending Office for all Loans:
Riggs Bank
808 17th Street, NW
10th Floor, C-10001
Washington, DC 20006
Address for Notices:
Riggs Bank
Comm. Loan Operations
5700 Rivertech Court, RN305
Riverdale, MD 20737
Attention: Stephanie Sayles
Telecopier No.: 301-887-8837
Telephone No.: 303-887-8859
SOCIETE GENERALE, NEW YORK BRANCH,
as a Lender
By: /s/ John Sadik-Khan
-----------------------------
Name: John Sadik-Khan
Title: Vice President
Lending Office for all Loans:
Societe Generale
1221 Avenue of the Americas
New York, NY 10020
Address for Notices:
Societe Generale
1221 Avenue of the Americas
New York, NY 10020
Atention: Yolett Salnave/Regine
Le Navene
Telecopier No.: 212-278-6240
Telephone No.: 212-278-6426/6486
State Street Bank and Trust Company,
as a Lender
By: /s/ John Tyler
------------------------------
Name: John Tyler
Title: Vice President
Lending Office for all Loans:
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
Address for Notices:
State Street Bank and Trust Company
Communications Department
225 Franklin Street, 2nd Street
Boston, MA 02110
Attention: John Tyler
Telecopier No.: 617-664-3708
Telephone No.: 617-664-4303
THE BANK OF NOVIA SCOTIA,
as a Lender
By: /s/ Mark Narbey
------------------------------
Name: Mark Narbey
Title: Authorized Signatory
Lending Office for all Loans:
One Liberty Plaza
New York, New York 10006
Attn: E. Fiore
Loan Administration
Address for Notices:
One Liberty Plaza
New York, New York 10006
Attention: Mark Narbey
Telecopier No.: 212-225-5090
Telephone No.: 212-225-5039
THE SUMITOMO BANK, LIMITED,
as a Lender
By: /s/ Ken-Ichiro Kobayashi
------------------------------
Name: Ken-Ichiro Kobayashi
Title: Joint General Manager
Lending Office for all Loans:
The Sumitomo Bank, Limited
Chicago Branch
233 South Wacker Drive, Suite 4800
Chicago, IL 60606
Address for Notices:
The Sumitomo Bank, Limited
Chicago Branch
233 South Wacker Drive, Suite 4800
Chicago, IL 60606
Attention: P. Kennedy / Mary Coseo
Telecopier No.: 312-876-6436
Telephone No.: P. Kennedy
312-876-6453
M. Coseo
312-876-6452
THE SUMITOMO TRUST & BANKING CO.,
LTD., NEW YORK BRANCH,
as a Lender
By: /s/ Suraj P. Bhatia
------------------------------
Name: Suraj P. Bhatia
Title: Senior Vice-President
and Department Manager
Lending Office for all Loans:
527 Madison Avenue
New York City, NY 10022
Address for Notices:
527 Madison Avenue
New York City, NY 10022
Attention: Robin Schreiber
Telecopier No.: 212-418-4848
Telephone No.: 212-326-0781
UNION BANK OF CALIFORNIA, N.A.,
as a Lender
By: /s/ J. Kevin Sampson
------------------------------
Name: J. Kevin Sampson
Title: Vice President
Lending Office for all Loans:
445 South Figueroa
Los Angeles, CA 90071
Address for Notices:
445 South Figueroa
Los Angeles, CA
Attention: Kevin Sampson
Telecopier No.: 213-236-5747
Telephone No.: 213-236-6585
UNION CENTRAL INSURANCE
& INVESTMENTS,
as a Lender
By: /s/ Gary R. Rodmaker
------------------------------
Name: Gary R. Rodmaker
Title: Second Vice President
Lending Office for all Loans:
Union Central Insurance
& Investments
1876 Waycross Road
Cincinnati, Ohio 45240
Address for Notices:
Carillon Advisers, Inc.
Attn: Gary R. Rodmaker
1876 Waycross Road
Cincinnati, Ohio 45240
Telecopier No.: 513-595-2475
Telephone No.: 513-595-2843
<TABLE>
ANNEX A
COMMITMENTS
Allocation
-------------------------------------------------------------------------------
Revolving Tranche A Tranche B Tranche C Term
Credit Term Loan Term Loan Loan
Institution Commitments Commitment Commitment Commitment Total
- ----------- ----------- ----------- ----------- -------------- ------------
<S> <C> <C> <C> <C> <C>
Toronto Dominion (Texas), Inc. $10,000,000 $30,000,000 $70,000,000 $70,000,000 $180,000,000
Merrill Lynch Capital Corporation 10,000,000 30,000,000 63,750,000 63,750,000 167,500,000
Bank of America National Trust and
Savings Association 10,000,000 30,000,000 7,500,000 7,500,000 55,000,000
NationsBank, N.A. 10,000,000 30,000,000 5,000,000 5,000,000 50,000,000
Allstate Insurance Company 0 0 2,500,000 2,500,000 5,000,000
Allstate Life Insurance Company 0 0 5,000,000 5,000,000 10,000,000
Balanced HighYield Fund I Ltd. 0 0 5,000,000 5,000,000 10,000,000
Barclays Bank PLC 8,750,000 26,250,000 0 0 35,000,000
BHFBANK Aktiengesellschaft 7,500,000 22,500,000 0 0 30,000,000
CoBank, ACB 3,750,000 11,250,000 0 0 15,000,000
Cooperative Centrale RaiffeisenBoerenleenbank
B.A., New York Branch 6,250,000 18,750,000 0 0 25,000,000
Credit Lyonnais 0 0 10,000,000 10,000,000 20,000,000
First Allmerica Finance Life Insurance Company 0 0 5,000,000 5,000,000 10,000,000
First Union National Bank 8,750,000 26,250,000 0 0 35,000,000
Fleet National Bank 8,750,000 26,250,000 0 0 35,000,000
Franklin Floating Rate Trust 0 0 2,500,000 2,500,000 5,000,000
General Electric Capital Corporation 7,500,000 22,500,000 6,250,000 6,250,000 42,500,000
ING High Income Principal Preservation Fund
Holdings, LDC 0 0 2,500,000 2,500,000 5,000,000
KZH Holding Corporation III 0 0 2,500,000 2,500,000 5,000,000
Mercantile Bank National Association 3,750,000 11,250,000 0 0 15,000,000
ML CLO XIX Sterling (Cayman) Ltd. 0 0 5,000,000 5,000,000 10,000,000
National Westminster Bank PLC 0 0 5,000,000 5,000,000 10,000,000
Paribas 3,750,000 11,250,000 0 0 15,000,000
PNC Bank, National Association 8,750,000 26,250,000 0 0 35,000,000
Riggs Bank, N.A. 3,750,000 11,250,000 0 0 15,000,000
Societe Generale, New York Branch 8,750,000 26,250,000 0 0 35,000,000
State Street Bank and Trust Company 3,750,000 11,250,000 0 0 15,000,000
The Bank of Nova Scotia 6,250,000 18,750,000 0 0 25,000,000
The First National Bank of Maryland 6,250,000 18,750,000 0 0 25,000,000
The Sumitomo Bank, Limited 3,750,000 11,250,000 0 0 15,000,000
The Sumitomo Trust and Banking Co.,
Ltd., New York Branch 3,750,000 11,250,000 0 0 15,000,000
Union Bank of California, N.A. 6,250,000 18,750,000 0 0 25,000,000
Union Central Insurance and Investments 2,500,000 2,500,000 5,000,000
------------ ------------ ------------ ------------ --------------
Total $150,000,000 $450,000,000 $200,000,000 $200,000,000 $1,000,000,000
============ ============ ============ ============ ==============
</TABLE>
<TABLE>
SCHEDULE 1.01(a)
LIBOR Loans ABR Loans
----------- ---------
<S> <C> <C>
Revolving Credit Loans 2.500% 1.500%
Tranche A Term Loans 2.500% 1.500%
Tranche B Term Loans 2.750% 1.750%
Tranche C Term Loans 3.000% 2.000%
</TABLE>
<TABLE>
SCHEDULE 1.01(b)
- ---------------------------------------------------------------------------------------------------------------------------------
Revolving Loans
and Term A Loans Term B Loans Term C Loans
- ---------------------------------------------------------------------------------------------------------------------------------
Tier Total Leverage Ratio LIBOR MARGIN ABR MARGIN LIBOR MARGIN ABR MARGIN LIBOR MARGIN ABR MARGIN
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
I Greater than
or equal to 8.0:1.0 2.250% 1.250% 2.750% 1.750% 3.000% 2.000%
- ---------------------------------------------------------------------------------------------------------------------------------
II Lesser than 8.0:1.0 but
Greater than
or equal to 7.0:1.0 1.875% 0.875% 2.750% 1.750% 3.000% 2.000%
- ---------------------------------------------------------------------------------------------------------------------------------
III Lesser than 7.0:1.0 but
Greater than
or equal to 6.0:1.0 1.625% 0.625% 2.500% 1.500% 2.750% 1.750%
- ---------------------------------------------------------------------------------------------------------------------------------
IV Lesser than 6.0:1.0 but
Greater than
or equal to 5.0:1.0 1.375% 0.375% 2.500% 1.500% 2.750% 1.750%
- ---------------------------------------------------------------------------------------------------------------------------------
V Lesser than 5.0:1.0 1.125% 0.125% 2.500% 1.500% 2.750% 1.750%
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
SCHEDULE 1.01(c)
Total Leverage Ratio Applicable Revolving Credit Fee Percentage
-------------------- ------------------------------------------
<S> <C>
Lesser than
or equal to 7.0:1.0 0.500%
Lesser than 7.0:1.0 but
greater than
or equal to 5.0:1.0 0.375%
Lesser than 5.0:1.0 0.250%
</TABLE>
SCHEDULE 1.01(d)
GUARANTORS
AMERICAN CELLULAR CORPORATION
CONNECTONE COMMUNICATIONS CORPORATION
PCPCS CORPORATION
ICSB CORPORATION
ALTON CELLTELCO CELLULAR CORPORATION
ALEXANDRA CELLULAR CORPORATION
AMRO CELLULAR CORPORATION
BUNYON CELLULAR CORPORATION
CELLULAR INFORMATION SYSTEMS OF LAREDO, INC.
CENTRAL KENTUCKY CELLULAR CORPORATION
CHILL CELLULAR CORPORATION
CHIPPEWA CELLULAR CORPORATION
DUTCHESS COUNTY CELLULAR TELEPHONE COMPANY, INC.
DULUTH/SUPERIOR CELLULAR, INC.
EASTERN WIRELESS CELLULAR CORPORATION
FIVE CELLULAR CORPORATION
FOUR CELLULAR CORPORATION
GILRO CELLULAR CORPORATION
JESSICA CELLULAR CORPORATION
KYLE CELLULAR CORPORATION
MARATHON CELLULAR CORPORATION
MINNESOTA SIX CELLULAR CORPORATION
NORTHLAND CELLULAR CORPORATION
ONE CELLULAR CORPORATION
PEBBLES CELLULAR CORPORATION
SEVEN CELLULAR CORPORATION
THREE CELLULAR CORPORATION
VILAS CELLULAR CORPORATION
WAUSAU CELLULAR LICENSE CORPORATION
ALTON CELLTELCO PARTNERSHIP
WAUSAU CELLULAR LIMITED PARTNERSHIP
<TABLE>
SCHEDULE 3.01(b)
AMORTIZATION PAYMENTS
TRANCHE A TRANCHE B TRANCHE C
DATE* TERM LOANS TERM LOANS TERM LOANS
- ------------------ ------------ ------------- ------------
<S> <C> <C> <C>
June 1999 $ 0 $ 500,000 $ 500,000
September 1999 0 500,000 500,000
December 1999 0 500,000 500,000
March 2000 0 500,000 500,000
June 2000 0 500,000 500,000
September 2000 0 500,000 500,000
December 2000 0 500,000 500,000
March 2001 11,250,000 500,000 500,000
June 2001 11,250,000 500,000 500,000
September 2001 11,250,000 500,000 500,000
December 2001 11,250,000 500,000 500,000
March 2002 11,250,000 500,000 500,000
June 2002 11,250,000 500,000 500,000
September 2002 11,250,000 500,000 500,000
December 2002 11,250,000 500,000 500,000
March 2003 16,875,000 500,000 500,000
June 2003 16,875,000 500,000 500,000
September 2003 16,875,000 500,000 500,000
December 2003 16,875,000 500,000 500,000
March 2004 16,875,000 500,000 500,000
June 2004 16,875,000 500,000 500,000
September 2004 16,875,000 500,000 500,000
December 2004 16,875,000 500,000 500,000
March 2005 22,500,000 500,000 500,000
June 2005 22,500,000 500,000 500,000
September 2005 22,500,000 500,000 500,000
December 2005 22,500,000 500,000 500,000
March 2006 33,750,000 500,000 500,000
June 2006 33,750,000 500,000 500,000
September 2006 33,750,000 500,000 500,000
December 2006 33,750,000 500,000 500,000
March 2007 500,000 500,000
June 2007 184,000,000 500,000
September 2007 500,000
December 2007 183,000,000
------------
$450,000,000 $200,000,000 $200,000,000
==+========= ============ ============
- -------------------------
*Unless otherwise indicated, such date is the last Business Day of the specified month.
</TABLE>
EXHIBIT 99.B3
June 25, 1998
The Board of Directors of PriCellular Corporation, the Board of Directors of
PriCellular Wireless Corporation and the Board of Directors of American Cellular
Corporation
And
To each of the Lenders party to the Credit Agreement (as defined below) and TD
Securities (USA) Inc. and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, as Arrangers; Toronto Dominion (Texas), Inc., as
Administrative Agent; Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as Syndication Agent; and Bank of America National Trust and
Savings Association and Nationsbank of Texas, N.A., as Co-Documentation Agents
for the Lenders
Ladies and Gentlemen:
This letter is being provided by Valuation Research Corporation ("Valuation")
reporting the performance of certain limited procedures at the request of the
Arrangers and the Boards of Directors of PriCellular Corporation
("PriCellular"), PriCellular Wireless Corporation ("PriCellular Wireless") and
American Cellular Corporation ("ACC"). This opinion (the "Opinion") was prepared
to (i) assist the Boards of Directors of PriCellular, PriCellular Wireless and
ACC in addressing the capital impairment provisions under Sections 154 and 160
of the Delaware General Corporation Law ("GCL"), and (ii) assist the Borrower
with complying with conditions precedent to Loans under Section 7.01 (i) (7) of
the Credit Agreement (the "Credit Agreeement") dated as of June 25, 1998 (the
"Closing Date") among American Cellular Wireless LLC (to be merged with
PriCellular Wireless), as Borrower; ACC (to be merged with and into
PriCellular), as Guarantor; the other Guarantors; the Lenders; Arrangers;
Administrative Agent; Syndication Agent; and Co-Documentation Agents.
Capitalized terms defined in the Credit Agreement are used herein as defined
therein unless otherwise defined herein.
It is our understanding that (i) ACC has been formed by Spectrum Equity
Investors II, L.P. and its affiliates ("Spectrum") and Providence Equity
Partners L.P., and its affiliates ("Providence") and other investors (together
with Spectrum and Providence, the "Investors") for the purpose of effecting the
acquisition (the"Acquisition") of PriCellular pursuant to an agreement and plan
of merger (the "Merger Agreement"); (ii) pursuant to the Merger Agreement, ACC
will merge (the "Merger") with and into PriCellular, with PriCellular as the
surviving corporation; (iii) upon consummation of the Merger, each share of
common stock of PriCellular (other than shares held by PriCellular as treasury
stock in or by ACC and its subsidiaries) will be converted into the right to
receive $14 per share (not including appraisal rights) in cash; and (iv) the
total purchase price for the equity (the "Stock Repurchase") of PriCellular will
not exceed $820 million for all shares (including appraisal rights).
In connection with the consummation of the Acquisition, (a) the Investors will
purchase for cash at or prior to the time of consummation of the Merger from ACC
common equity in an aggregate amount of $25 million and preferred stock (the
"New Preferred") in an aggregate amount of $325 million (the "Equity
Refinancing") and (b) ACC has raised gross proceeds of $282.8 million (the
"Senior Note Financing") in the form of 10 1/2 % senior notes (the "Senior
Notes"). The Senior Notes were priced on May 6, 1998 at 99.24 % to investors and
netted $274.3 million for ACC after the Initial Purchasers's Discount of
approximately $8.6 million. At the Closing of the Merger, ACC will purchase
Government Securities (the "Pledged Securities"), representing funds sufficient
to pay the first six scheduled payments of interest on the Senior Notes.
Also, in connection with the Merger, PriCellular Wireless (to be merged with and
into American Cellular Wireless LLC ("American Wireless") immediately after the
Merger) a wholly owned subsidiary of ACC has entered into the Credit Agreement.
The Credit Agreement provides for (i) three Term Loan Facilities in an aggregate
principal amount of $850 million and (ii) Revolving Credit Loans in an aggregate
principal amount of $150 million. A portion of the Revolving Credit Facility
will be available as a Letter of Credit subfacility. In connection with the
consummation of the Acquisition, American Wireless will pay a cash dividend in
an aggregate amount expected not to exceed $260 million (the "Dividend") to ACC
at the time of consummation of the Merger.
In connection with the Merger, we assume that American Wireless will acquire
and/or defease all of the 10-3/4% Senior Notes due 2004, the 12-1/4% Senior
Subordinated Discount Notes due 2003 and the 14% Senior Subordinated Discount
notes due 2001 of PriCellular Wireless (collectively the "Existing Notes"). We
also assume that the 10 3/4 % Senior Subordinated Convertible Discount Notes due
2004 of PriCellular will be converted into common stock on or about the
effective time of the Merger.
The Acquisition, the Merger, the Stock Repurchase, the Senior Note Financing,
the Equity Financing, the repayment of the Existing Notes (the "Note Tender"
including the defeasance of all remaining Existing Notes) and the entering into
and borrowings under the Credit Facilities by the parties herein described are
herein referred to as the "Transactions".
Upon consummation of the Transactions, ACC's primary asset will be its
investment in American Wireless. As a result ACC and American Wireless will be
in the same business (the "Business") in which PriCellular and PriCellular
Wireless were previously engaged. The Business is that of operating an
independent rural cellular telephone system through the ownership and operation
of FCC-licensed non-wireline cellular telephone systems in rural areas of the
Midwestern and Eastern portions of the United States under the CELLULARONE
service mark.
Contemporaneous or forward looking references used in this opinion will refer to
ACC or American Wireless, the new entity operated by the management group headed
by Brian McTernan, John Fujii and James J. Walter, Jr. References to past
operations or historical financial information will be to PriCellular or
PriCellular Wireless (prior to its merger with and into American Wireless).
Pursuant to our understanding of the above, Valuation has been asked to provide
its Opinion as of June 25, 1998 (the "Closing Date") with respect to ACC and
American Wireless both prior to and immediately after and giving effect to the
consummation of the Transactions (defined below), as described above:
(a) The Fair Market Value of the aggregate assets of each of ACC and
American Wireless exceeds and will exceed its respective Debts and other
liabilities, contingent or otherwise (including, without limitation, the New
Financing, the Stated Liabilities, and the Identified Contingent Liabilities,
all as defined below) by an amount at least equal to its Stated Capital;
(b) The Present Fair Saleable Value and Fair Value of the aggregate
assets of each of ACC and its subsidiaries on a consolidated basis and American
Wireless and its subsidiaries on a consolidated basis, exceeds and will exceed
the amount that is or will be required to pay the probable liability on their
respective Debts and other liabilities contingent or otherwise (including,
without limitation, the New Financing, the Stated Liabilities, and the
Identified Contingent Liabilities) as such Debts and other liabilities become
absolute and matured;
Each of ACC and its subsidiaries on a consolidated basis and American Wireless
and its subsidiaries on a consolidated basis are and will be able to pay their
respective Debts and other liabilities (including, without limitation, the New
Financing, the Stated Liabilities, and the Identified Contingent Liabilities) as
such Debts become absolute and matured; and
(d) Each of ACC and its subsidiaries on a consolidated basis and
American Wireless and its subsidiaries on a consolidated basis will not have
Unreasonably Small Capital with which to conduct the Business in which they are
engaged as such business is now conducted and is proposed to be conducted
following the Closing Date.
The Opinion rendered is with respect to each of ACC and its subsidiaries on a
consolidated basis as a going concern and American Wireless and its subsidiaries
on a consolidated basis as a going concern. In the course of preparing this
Opinion, nothing has come to our attention that causes us to believe that ACC
and American Wireless (individually and on a consolidated basis) would not be
viewed as a going concern. For the purposes of this Opinion, the following terms
are defined:
(a) Fair Market Value and Fair Value
The amount at which the aggregate assets of each of ACC and
its subsidiaries on a consolidated basis and American Wireless and its
subsidiaries on a consolidated basis would change hands between a willing buyer
and a willing seller, within a commercially reasonable period of time, each
having reasonable knowledge of the relevant facts, neither being under any
compulsion to act, with equity to both.
(b) Present Fair Saleable Value
The aggregate amount that may be realized by an independent
willing seller from an independent willing buyer if a company's assets are sold
with reasonable promptness in an arm's-length transaction under present
conditions for the sale of assets of comparable business enterprises in an
existing and not theoretical market.
(c) Stated Liabilities
The recorded liabilities of each of ACC and its subsidiaries
on a consolidated basis and American Wireless and its subsidiaries on a
consolidated basis as well as any assumed liabilities related to the
Transactions, determined in accordance with generally accepted accounting
principles ("GAAP") consistently applied as set forth in the consolidated pro
forma balance sheet (the "Pro Forma Balance Sheet"), at the Closing Date all of
which information has been provided to us by officers of ACC and American
Wireless responsible for financial and accounting matters. The Pro Forma Balance
Sheet was based in part on ACC's Pro Forma balance sheet as of December 31,
1997, as reported on page 25 of the Senior Notes Offering Memorandum, adjusted
based on PriCellular's March 31, 1998 balance sheet, which has been further
adjusted for changes in cash levels and debt levels which have occurred since
March 31, 1998. In addition, we have received representations from management of
the Borrower that there have been no material adverse changes to the financial
position of the Borrower since March 31, 1998.
(d) New Financing
The estimated amount of total indebtedness that would be
incurred, assumed or guaranteed by ACC through the issuance of the Senior Notes
and borrowings under the Credit Facility incurred by American Wireless and
guaranteed by ACC.
(e) Identified Contingent Liabilities
The maximum reasonably estimated liabilities that may result
from pending litigation, asserted claims and assessments, guaranties,
environmental conditions, uninsured risks, and other contingent liabilities as
identified and explained to us in terms of their nature and estimated dollar
magnitude by Management. We do not give any opinion as to whether such
contingent liabilities meet the criteria for accrual under Statement of
Financial Accounting Standards No. 5.
(f) Unreasonably Small Capital
The ability of each of ACC and its subsidiaries on a
consolidated basis, and American Wireless and its subsidiaries on a consolidated
basis, after giving effect to the incurrence of the New Financing and after
consummation of the Transactions to continue as a going concern and not lack
sufficient capital for the needs and anticipated needs of the Business,
including Identified Contingent Liabilities, without substantial unplanned
disposition of assets outside the ordinary course of business, restructuring of
debt, externally forced revisions of its operations, or similar actions.
(g) Debt
Debt means liability on a claim and "claim" means (x) any
right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent secured, disputed or undisputed or
(y) right to an equitable remedy for breach of performance if such breach gives
rise to any such right to payment.
(h) "Stated Capital" means, in the case of each of ACC and American
Wireless, "capital" as defined in and computed in accordance with Sections 154
and 244 of the General Corporation Law of the State of Delaware, i.e., the
aggregate amount represented by the aggregate par value of the outstanding
shares of capital stock of each of ACC and American Wireless, plus any amounts
assigned or transferred to the capital of ACC and American Wireless, and minus
any reduction to the capital of ACC and American Wireless, by action of its
board of directors.
We believe the foregoing definitions are reasonable and appropriate for purposes
of rendering the Opinion, and we believe that the methodologies we use in our
analysis are appropriate for determining the Fair Market Value, Fair Value and
Present Fair Saleable Value (as defined herein) of the assets of ACC and its
subsidiaries on a consolidated basis and American Wireless and its subsidiaries
on a consolidated basis. Based on our inquiry, we believe it is appropriate for
us to value both ACC and American Wireless as going concerns as part of our
analysis relating to this Opinion.
In expressing its Opinion, Valuation has relied on information and analyses
furnished by and/or discussions held with Management, and its accountants, which
information and analyses Valuation has reviewed and which has been the subject
of discussion and inquiry. Valuation does not assume any responsibility for the
sufficiency and accuracy of the information. Nothing has come to Valuation's
attention in the course of its engagement which would lead it to believe that
any such information is incorrect in any material respect or that it was
unreasonable for Valuation to utilize and rely upon the information. Such data
has been accepted as reasonably reflecting the Transactions, the financial
condition of the Company basis and their past and future operations. All items
subject to audit pursuant to generally accepted auditing standards and in
conformity with generally accepted accounting principles ("GAAP") have been
relied upon without review, check, or verification, and nothing has come to our
attention that would cause us to believe the information is incorrect in any
material respect or that it was unreasonable for Valuation to utilize and rely
upon the information. Valuation has performed certain analyses, studies, and
investigations more fully described herein in support of its Opinion. Further,
the Opinion expressed herein is subject to the General Limiting Conditions and
Assumptions attached hereto as Exhibit A.
Valuation has reviewed available financial statements of the Business in
addition to background data and material considered appropriate to the Opinion
expressed. Such areas of investigation include but are not limited to:
* The audited financial statements for PriCellular for the years ended
December 31, 1995, December 31, 1996 and December 31, 1997.
* The unaudited financial statements for the PriCellular for the
quarters ended March 31, 1997 and March 31, 1998.
* Management reports containing information on the monthly cash flow,
market penetration, churn, activations and roaming minutes for the fourteen
months ended February 28, 1998.
* Financial information prepared by ACC relative to the operation of
the four clusters for the year ended December 31, 1997 and projections through
2007.
* ACC's forecast for 1998-2007 (the "Forecast").
* Overview of the industry in which ACC and American Wireless operate,
including an analysis of companies engaged in similar lines of business and a
review of acquisitions of companies engaged in similar lines of business.
* Inquiries of Management as to the impact of future trends on its
business and its industry including expected demand for their services;
capacity; new product introductions; possible acquisitions, estimated future
levels of working capital and capital expenditures; competitive conditions and
advantages; technology, strategic positioning; and key actions to be taken in
the near term, among other factors.
* Business data and information made available to Valuation,
including historical and pro forma financial statements.
* The Offering Memorandum dated May 6, 1998 for the $285,000,000 Senior
Notes due 2008 (the "Senior Notes Offering").
* The Merger Agreement.
* Review of the Credit Agreement.
* Review of the ACC Certificates of Incorporation as amended and
the Certificate of Formation of American Wireless.
* The Schedule 14-C Definitive Information Statement dated May
28, 1998.
* Inquiries of members of Management who have responsibility for legal,
financial, and accounting matters as to the existence, nature, and magnitude of
Identified Contingent Liabilities. Because the Identified Contingent Liabilities
are estimates of Management, we express no opinion as to the completeness or
propriety of such items. However, after discussion with Management with respect
thereto, and based on our experience in reviewing such liabilities, nothing has
come to our attention in the course of our review which would suggest that any
such information is incorrect in any material respect or unreasonable for
Valuation to utilize.
For purposes of this Opinion, Valuation has assumed that there will be no
material change in any documents in Valuation's possession on the Closing Date.
Valuation has discussed financial and operating matters of ACC and American
Wireless with Management and their advisors. Valuation has reviewed the
Forecasts of earnings, income, cash flows, and balance sheets prepared by
Management and discussed such Forecasts with Management. This review included,
but was not limited to, discussions of basic assumptions made in the preparation
of the forecasts relating to the type of business; key markets; economic
conditions; reinvestment requirements; product and service development;
profitability, marketing and distribution; technology and strategic positioning.
We consider such forecasts to be reasonable and attainable in light of current
and near term economic expectations and nothing has come to our attention that
would cause us to believe the basic assumptions used in the forecasts are
unreasonable. We believe that the review we have conducted and the analyses and
procedures undertaken are those generally considered appropriate for expressing
the Opinion herein.
Based on the foregoing review, procedures and analyses, we express the following
Opinion as of the Closing Date, that both prior to and immediately after and
giving effect to the consummation of the Transactions, all predicated on the
General Limiting Conditions and Assumptions set forth in Exhibit A:
(a) The Fair Market Value of the aggregate assets of each of ACC and its
subsidiaries on a consolidated basis and American Wireless and its subsidiaries
on a consolidated basis exceeds and will exceed its respective Debts and other
liabilities, contingent or otherwise (including, without limitation, the New
Financing, the Stated Liabilities, and the Identified Contingent Liabilities) by
an amount at least equal to its Stated Capital;
The Present Fair Saleable Value and Fair Value of the aggregate assets of each
of ACC and its subsidiaries on a consolidated basis and American Wireless and
its subsidiaries on a consolidated basis, will exceed the amount that is or will
be required to pay the probable liability on their respective Debts and other
liabilities contingent or otherwise (including, without limitation, the New
Financing, the Stated Liabilities, and the Identified Contingent Liabilities) as
such Debts and other liabilities become absolute and matured;
(c) Each of ACC and its subsidiaries on a consolidated basis and American
Wireless and its subsidiaries on a consolidated basis are and will be able to
pay their respective Debts and other liabilities (including, without limitation,
the New Financing, the Stated Liabilities, and the Identified Contingent
Liabilities) as such Debts become absolute and matured; and
Each of ACC and its subsidiaries on a consolidated basis and American Wireless
and its subsidiaries on a consolidated basis will not have Unreasonably Small
Capital with which to conduct the Business in which they are engaged as such
business is now conducted and is proposed to be conducted following the Closing
Date.
This letter is solely for the information of and assistance to the parties to
whom it is addressed for matters in connection with the Transactions and New
Financing, except as set forth in the General Limiting Conditions and
Assumptions and except that copies hereof may be delivered to and relied upon by
the Boards of Directors of PriCellular and ACC and the Banks under the Credit
Agreement. Any other use is expressly prohibited and neither this letter nor any
of its parts may be circulated, quoted, or otherwise referred to for any other
purpose without the prior review and written consent of Valuation, which will
not be unreasonably withheld, except that PriCellular and ACC may file or
furnish this Opinion in connection with the Information Statement and the
Schedule 13 E-3.
The above limitations do not apply to related parties whom you believe have a
legitimate business interest in receiving such copies, including counsel,
potential and future participating lenders, courts, administrative agencies, and
other appropriate parties. However, in such instances, this Opinion must be
provided to such parties in its entirety. The term "related parties" shall not
exclude participants and assignees of the Lenders, regulators, additional
lenders, successors, or appropriate parties involved in litigation or court
proceedings involving the Transactions or under other similar circumstances.
Valuation has no responsibility to update the opinion stated herein for events
and circumstances occurring after the date of this letter.
Respectfully submitted,
VALUATION RESEARCH CORPORATION
Engagement Number: 04-2923-00
EXHIBIT A
GENERAL LIMITING CONDITIONS AND ASSUMPTIONS
In accordance with recognized professional standards as generally practiced in
the valuation industry, the fee for these services is not contingent upon the
conclusions of value contained herein. Valuation has determined to the best of
its knowledge and in good faith that neither it nor any of its agents or
employees have any material financial interest in ACC, American Wireless or
their subsidiaries.
Neither Valuation, nor its agents or employees, assume any responsibility for
matters legal in nature, nor do they render any opinion as to any title to, or
legal status of, property which may be involved, both real and personal,
tangible and intangible.
Valuation assumes that all laws, statutes, ordinances, or other regulations, or
regulations of any governmental authority relevant to and in connection with
this engagement are complied with by each relevant party other than Valuation
unless express written noncompliance is brought to the attention of Valuation
and is stated and defined by those relied on by Valuation.
Valuation has relied on certain information furnished by others, including but
not limited to ACC and American Wireless, without verification, other than the
procedures specified in Valuation's letter attached hereto. Valuation believes
such information to be reliable as to accuracy and completeness but offers no
warranty or representation to that effect; however, nothing has come to our
attention in the course of this engagement that would cause us to believe that
any information is inaccurate in any material respect or that it is unreasonable
to utilize and rely upon such information. The information relied upon generally
includes, but is not limited to, financial analyses and forecasts; historical,
pro forma, audited and unaudited financial statements; and Management analyses
and forecasts.
Where there may be real property involved in the Transactions, unless
specifically stated, Valuation has not made a land survey of the property, but
has relied on information furnished by ACC and American Wireless. It is assumed
that there are no hidden or inapparent conditions of the property, subsoil, or
structures thereon that render it more or less valuable except as disclosed in
environmental reports. No responsibility is assumed for such conditions or for
arranging for engineering studies that may be required to discover them.
Valuation assumes in the case of leases of real and other property that the
Transactions will not trigger any renegotiations of such leases to market rates
based upon the change in the financial condition of ACC and American Wireless
arising out of the Transactions that would, in the aggregate, be material to ACC
and American Wireless. In connection with this matter, we have no reason to
believe that there will be any material adverse effect on ACC and American
Wireless arising from the consummation of the Transactions.
Valuation is not an environmental consultant or auditor, and it takes no
responsibility for any actual or potential environmental liabilities. Valuation
does not conduct or provide environmental assessments and has not performed one
for ACC or American Wireless
Valuation has asked Management whether it is subject to any present or future
liability relating to environmental matters (including but not limited to
CERCLA/Superfund liability). Valuation has not determined independently whether
ACC or American Wireless are subject to any such liabilities, nor the scope of
any such liabilities. Valuation's opinion takes no such liabilities into account
except as they have been reported expressly to Valuation by ACC or American
Wireless, or by an environmental consultant working for ACC or American
Wireless, or in the Environmental Assessment and then only to the extent that
the liability was reported to us in an actual or estimated dollar amount. To the
extent such information has been reported to us, Valuation has relied on it
without verification and offers no warranty or representation as to its accuracy
or completeness.
We have not made a specific compliance survey or analysis of the subject
properties to determine whether they are subject to or in compliance with the
Americans with Disability Act of 1990 (ADA) and this opinion does not consider
the impact, if any, of non-compliance in estimating the value of the properties.
In some instances, public information and statistical information have been
obtained from sources Valuation reasonably believes to be reliable. These
sources include annual reports to shareholders, the Form 10K's and Form 10Q's
filed with the Securities and Exchange Commission of companies reviewed within
the various industries in which the Company operates, Infovest, Value Line
Investment Survey, Standard & Poor's Industry Surveys; Paul Kagan Associates;
however, Valuation makes no representation as to the accuracy or completeness of
such information and has accepted the information without further verification.
The Opinion of Valuation does not represent an assurance, guarantee, or warranty
that ACC and American Wireless and their respective subsidiaries will meet all
of their obligations under the Senior Notes or the Credit Agreement.
Valuation has analyzed and reviewed the Transactions and provided the Opinion
for capital impairment and solvency purposes only and for no other purpose.
Valuation's Opinion is in no way given as an indication of the fairness of the
Transactions to any shareholder of ACC or American Wireless or their respective
subsidiaries or any equity participant in the Transactions.
Any further consultation, testimony, attendance or research in reference to the
present engagement beyond the Opinion expressed herein as of the date of
valuation are subject to agreement by Valuation in specific written arrangements
between the parties.
No representation is made herein as to the legal sufficiency of the above
definitions (term definitions contained in the body of the Opinion) for any
purpose; such definitions are used solely for setting forth the scope of this
Opinion and Valuation believes such definitions to be reasonable for the
purposes of rendering this Opinion.
The Opinion of Fair Value, Present Fair Saleable Value and Fair Market Value of
the assets expressed by Valuation results from the development and analysis of
several valuation indications arrived at through the use of accepted valuation
procedures as practiced in the valuation industry. These procedures included the
Income Approach and the Market Approach, described below, which we believe to be
procedures appropriate to express the Opinion herein.
The Income Approach utilized cash flow projections discounted to a present
value. The discount rates selected were based on risk and return requirements
deemed appropriate by Valuation, given the facts and circumstances surrounding
the Transactions. The discount rates utilized in our analysis considered the
Company's and industry weighted average cost of capital, the rates of returns on
alternative investments and the specific risk inherent in the investment under
consideration.
The Market Approach is a valuation technique in which the estimated market value
is based on market prices in actual transactions. The technique consists of
undertaking a detailed market analysis of publicly-traded companies and
acquisitions of companies that provide a reasonable basis for comparison to the
relative investment characteristics of the subject entity (such companies are
referred to as "Guideline Companies"). Valuation ratios derived from the
guideline companies are then selected and applied to the subject entity after
consideration of adjustments for dissimilarities in financial position, growth,
markets, profitability, and other factors. The companies reviewed were all in
the business of operating wireless telephone systems. Additionally, historical
acquisitions of companies in related industries were reviewed.
In considering each of ACC and its Subsidiaries' and American Wireless and its
Subsidiaries ability to repay debts as they mature, we performed sensitivity
analysis on the projections varying sales growth rates, profit margins and
interest rates.
Our opinion is necessarily based on economic, market, financial and other
conditions as they exist on the date of this letter. While various judgments and
estimates which we consider reasonable and appropriate under the circumstances
were made by us in the determination of value, no assurance can be given by us
that the sale price which might ultimately be realized in any actual
transaction, if and when effected, will be at the Fair Value, Present Fair
Saleable Value or Fair Market Value concluded in our analysis.
Material changes in the industry or in market conditions which might affect each
of ACC and its Subsidiaries and American Wireless and its Subsidiaries from and
after the effective date of the proposed Transactions and which are not
reasonably foreseeable are not taken into account.
The management of each of ACC and its Subsidiaries and American Wireless and its
Subsidiaries has represented to VRC that they have no material Identified
Contingent Liabilities.
It has been represented to VRC that the only borrowings outstanding on the
Closing Date under the Credit Agreement will be $850.0 million of Term Loans and
there will be $72.3 million outstanding under the Revolving Loans.
VRC has assumed that the Borrower and its Subsidiaries will not make any
acquisitions during the projection period.
With respect to American Wireless and its Subsidiaries' ability to repay debts
as they mature, VRC has assumed that all of the Excess Cash Flow is applied to
the repayment of any outstanding obligations incurred under the Credit Agreement
except as otherwise indicated in the Forecasts.
The Company's forecast indicates that ACC may not have sufficient cash flow from
operations to repay all of the amounts due under the Senior Notes at their
maturity date. Although it is not unreasonable to expect that ACC will be able
to refinance this debt based on the projected capital structure, there can be no
assurance that any such refinancing will be effected. We have assumed that ACC
will repay the Senior Notes by refinancing a portion of them, raising equity
through either a private placement or initial public offering of ACC or American
Wireless, or issuing new debt. We believe that it is not unreasonable to make
this assumption given (i) the projected capital structure, (ii) the fact that
all of the Term Loans and Revolving Loans will have been repaid by this date,
(iii) the Company's projected operating cash flow would be sufficient to support
a loan large enough to repay the Senior Notes.
VALUATION RESEARCH CORPORATION
