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Exhibit 10.4
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FIRST AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF SEPTEMBER 19, 2000
AMONG
e.SPIRE COMMUNICATIONS, INC.
e.SPIRE FINANCE CORPORATION
AS BORROWERS,
THE LENDERS LISTED HEREIN,
AS LENDERS,
GOLDMAN SACHS CREDIT PARTNERS L.P.,
AS SOLE LEAD ARRANGER AND SYNDICATION AGENT,
THE BANK OF NEW YORK,
AS ADMINISTRATIVE AGENT,
FIRST UNION NATIONAL BANK,
AS DOCUMENTATION AGENT
AND
CIT LENDING SERVICES CORPORATION,
AS COLLATERAL AGENT
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e.SPIRE COMMUNICATIONS, INC.
e.SPIRE FINANCE CORPORATION
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
TABLE OF CONTENTS
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SECTION 1. DEFINITIONS...........................................................................2
1.1 Certain Defined Terms.................................................................2
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement............................................................................31
1.3 Other Definitional Provisions and Rules of Construction..............................31
SECTION 2. AMOUNTS AND TERMS OF LOANS...........................................................32
2.1 Loans; the Register; Notes...........................................................32
2.2 Interest on the Loans................................................................34
2.3 Fees.................................................................................38
2.4 Prepayments; General Provisions Regarding Payments; Application of Proceeds of
Collateral and Payments Under Subsidiary Guaranty....................................38
2.5 Use of Proceeds......................................................................45
2.6 Special Provisions Governing Eurodollar Rate Loans...................................45
2.7 Increased Costs; Taxes; Capital Adequacy.............................................48
2.8 Obligation of Lenders to Mitigate....................................................52
SECTION 3. CONDITIONS TO EFFECTIVENESS..........................................................53
3.1 Conditions to Effectiveness..........................................................53
3.2 Lender Acknowledgment and Consent....................................................55
SECTION 4. BORROWERS' REPRESENTATIONS AND WARRANTIES............................................55
4.1 Organization, Powers, Qualification, Good Standing, Business and Subsidiaries........55
4.2 Authorization, etc...................................................................57
4.3 Financial Condition..................................................................58
4.4 No Material Adverse Change; No Restricted Junior Payments............................58
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4.5 Title to Properties; Liens; Real Property............................................59
4.6 Litigation; Adverse Facts............................................................59
4.7 Payment of Taxes.....................................................................59
4.8 Performance of Agreements; Materially Adverse Agreements; Material Contracts.........60
4.9 Governmental Regulation..............................................................60
4.10 Securities Activities................................................................60
4.11 Employee Benefit Plans...............................................................60
4.12 Certain Fees.........................................................................61
4.13 Environmental Protection.............................................................61
4.14 Employee Matters.....................................................................62
4.15 Solvency.............................................................................62
4.16 Matters Relating to Collateral.......................................................62
4.17 Disclosure...........................................................................63
4.18 Representations Concerning Cash Management System....................................63
SECTION 5. BORROWERS' AFFIRMATIVE COVENANTS.....................................................64
5.1 Financial Statements and Other Reports...............................................64
5.2 Corporate Existence, etc.............................................................70
5.3 Payment of Taxes and Claims; Tax Consolidation.......................................70
5.4 Maintenance of Properties; Insurance; Application of Net
Insurance/Condemnation Proceeds......................................................70
5.5 Inspection Rights; Audits of Inventory and Accounts Receivable; Lender Meeting.......72
5.6 Compliance with Laws, etc............................................................72
5.7 Environmental Review and Investigation, Disclosure, Etc.; Company's Actions
Regarding Hazardous Materials Activities, Environmental Claims and Violations
of Environmental Laws................................................................72
5.8 Execution of Subsidiary Guaranty and Personal Property Collateral Documents by
Certain Subsidiaries and Future Subsidiaries.........................................74
5.9 Prepayment of Master Note............................................................76
5.10 Interest Rate Protection.............................................................76
5.11 Cash Management Systems..............................................................76
5.12 Stockholder and NASDAQ Approvals for Committed Preferred.............................77
5.13 Liquidity Requirement................................................................77
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SECTION 6. BORROWERS' NEGATIVE COVENANTS........................................................77
6.1 Indebtedness.........................................................................77
6.2 Liens and Related Matters............................................................78
6.3 Investments; Joint Ventures..........................................................80
6.4 Contingent Obligations...............................................................80
6.5 Restricted Junior Payments...........................................................81
6.6 Financial Covenants..................................................................82
6.7 [Intentionally Omitted]..............................................................87
6.8 Restriction on Fundamental Changes; Asset Sales......................................87
6.9 Acquisitions.........................................................................89
6.10 Sales and Lease-Backs................................................................89
6.11 Sale or Discount of Receivables......................................................90
6.12 Transactions with Shareholders and Affiliates........................................90
6.13 Disposal of Subsidiary Stock.........................................................90
6.14 Conduct of Business..................................................................90
6.15 Amendments or Waivers of Certain Related Agreements..................................91
6.16 Fiscal Year..........................................................................91
6.17 Master Note and Intercompany Purchase Money Note.....................................92
SECTION 7. EVENTS OF DEFAULT....................................................................92
7.1 Failure to Make Payments When Due....................................................92
7.2 Default in Other Agreements..........................................................92
7.3 Breach of Certain Covenants..........................................................92
7.4 Breach of Warranty...................................................................92
7.5 Other Defaults Under Loan Documents..................................................93
7.6 Involuntary Bankruptcy; Appointment of Receiver, etc.................................93
7.7 Voluntary Bankruptcy; Appointment of Receiver, etc...................................93
7.8 Judgments and Attachments............................................................93
7.9 Dissolution..........................................................................94
7.10 Employee Benefit Plans...............................................................94
7.11 Change in Control....................................................................94
7.12 Invalidity of Subsidiary Guaranty; Failure of Security; Repudiation of
Obligations..........................................................................94
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7.13 Licenses.............................................................................95
7.14 Stockholder and NASDAQ Approvals.....................................................95
SECTION 8. AGENTS...............................................................................96
8.1 Appointment..........................................................................96
8.2 Powers and Duties; General Immunity..................................................97
8.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness.....................................................................99
8.4 Right to Indemnity...................................................................99
8.5 Successor Administrative Agent.......................................................99
8.6 Collateral Documents and Guaranties.................................................100
SECTION 9. MISCELLANEOUS.......................................................................101
9.1 Assignments and Participations in Loans.............................................101
9.2 Expenses............................................................................104
9.3 Indemnity...........................................................................105
9.4 Set-Off; Security Interest in Deposit Accounts......................................105
9.5 Ratable Sharing.....................................................................106
9.6 Amendments and Waivers..............................................................106
9.7 Notices.............................................................................108
9.8 Survival of Representations, Warranties and Agreements..............................108
9.9 Failure or Indulgence Not Waiver; Remedies Cumulative...............................108
9.10 Marshalling; Payments Set Aside.....................................................108
9.11 Severability........................................................................109
9.12 Obligations Several; Independent Nature of Lenders' Rights..........................109
9.13 Headings............................................................................109
9.14 Applicable Law......................................................................109
9.15 Successors and Assigns..............................................................109
9.16 Consent to Jurisdiction and Service of Process......................................109
9.17 Waiver of Jury Trial................................................................110
9.18 Confidentiality.....................................................................111
9.19 Maximum Amount......................................................................111
9.20 Entire Agreement....................................................................112
9.21 Counterparts; Effectiveness.........................................................112
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9.22 Acknowledgment and Consent..........................................................112
SIGNATURE PAGES.....................................................................................S-1
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EXHIBITS
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I [INTENTIONALLY OMITTED]
II [INTENTIONALLY OMITTED]
III FORM OF NOTICE OF CONVERSION/CONTINUATION
IV FORM OF SERIES A REVOLVING NOTE
V FORM OF SERIES B TERM NOTE
VI FORM OF SERIES C TERM NOTE
VII FORM OF BLOCKED ACCOUNT AGREEMENT
VIII FORM OF COMPLIANCE CERTIFICATE
IX-A FORM OF OPINION OF DAVIS, POLK & WARDWELL
IX-B FORM OF OPINION OF COMPANY COUNSEL
X FORM OF ACSI ESCROW AGREEMENT
XI FORM OF ASSIGNMENT AGREEMENT
XII FORM OF CERTIFICATE RE NON-BANK STATUS
XIII FORM OF LOAN PUT AGREEMENT
XIV PROJECTIONS FOR SALE OF CYBERGATE'S DIAL-UP DIVISION
XV FORM OF CERTIFICATE OF DESIGNATION OF THE BRIDGE PREFERRED
XVI FORM OF CERTIFICATE OF DESIGNATION OF THE COMMITTED PREFERRED
XVII FORM OF COLLATERAL ACCOUNT AGREEMENT
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SCHEDULES
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1.2 UNRESTRICTED SUBSIDIARIES
2.1 LENDERS' LOANS AND PRO RATA SHARES
3.1 INTERCONNECTION AGREEMENTS
4.1 SUBSIDIARIES OF COMPANY
4.1E LICENSES
4.2C GOVERNMENTAL CONSENTS
4.6 LITIGATION
4.14 EMPLOYEE MATTERS
4.18 CASH MANAGEMENT SYSTEM
6.1 CERTAIN EXISTING INDEBTEDNESS
6.2 CERTAIN EXISTING LIENS
6.3 CERTAIN EXISTING INVESTMENTS
6.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
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e.SPIRE COMMUNICATIONS, INC.
e.SPIRE FINANCE CORPORATION
FIRST AMENDED AND RESTATED
CREDIT AGREEMENT
This FIRST AMENDED AND RESTATED CREDIT AGREEMENT is dated as of
September 19, 2000, and entered into by and among e.SPIRE COMMUNICATIONS,
INC., a Delaware corporation ("COMPANY"), e.SPIRE FINANCE CORPORATION, a
Delaware corporation ("FINANCE SUB"; Company and Finance Sub are each
individually referred to herein as a "BORROWER" and collectively as
"BORROWERS"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF
(each individually referred to herein as a "LENDER" and collectively as
"LENDERS"), GOLDMAN SACHS CREDIT PARTNERS L.P., as sole lead arranger (in such
capacity, "ARRANGER") and syndication agent (in such capacity, "SYNDICATION
AGENT"), THE BANK OF NEW YORK ("BNY"), as administrative agent for Lenders (in
such capacity, "ADMINISTRATIVE AGENT"), FIRST UNION NATIONAL BANK, as
documentation agent (in such capacity, "DOCUMENTATION AGENT"), and CIT LENDING
SERVICES CORPORATION, f/k/a Newcourt Commercial Finance Corporation, as
collateral agent (in such capacity, "COLLATERAL AGENT").
R E C I T A L S
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WHEREAS, pursuant to that certain Credit Agreement dated as of August
11, 1999 (as amended and otherwise modified through the date hereof, the
"ORIGINAL CREDIT AGREEMENT"; the capitalized terms used in the recitals
without definition having the meanings assigned to such terms in subsection
1.1 of this Agreement), Lenders have extended certain secured credit
facilities to Borrowers under which the following Loans are outstanding as of
the date hereof (after giving effect to the borrowings and prepayments
referred to in subsections 3.1J and 3.1O): (i) to Finance Sub, Series A
Revolving Loans in the principal amount of $35,000,000.00 used to finance
capital expenditures and for working capital and other general corporate
purposes, including permitted acquisitions and (ii) to Company, Series B Term
Loans in the principal amount of $4,329,268.29 and Series C Term Loans in the
principal amount of $99,670,731.71 used solely to provide purchase money
financing for the acquisition, construction or improvement of
Telecommunications Assets of Company and its Restricted Subsidiaries;
WHEREAS, Borrowers, Lenders and Agents desire to amend and restate
the Original Credit Agreement in its entirety upon the terms, and subject to
the conditions, contained herein;
WHEREAS, Company has loaned to Finance Sub all proceeds of the Series
B Term Loans and Series C Term Loans, which are evidenced by the Master Note
and secured by a pledge of the Intercompany Purchase Money Notes and security
therefor and all other assets of Finance Sub pursuant to the Finance Sub
Intercompany Pledge and Security Agreement;
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WHEREAS, Finance Sub has loaned to Restricted Subsidiaries the
proceeds of its borrowings under the Master Note to finance the cost of the
acquisition, construction or improvement of Telecommunications Assets and such
loans are evidenced by the Intercompany Purchase Money Note and are secured by
all of the assets of such Restricted Subsidiaries pursuant to the Intercompany
Pledge and Security Agreement;
WHEREAS, Company has guaranteed the obligations of Finance Sub
hereunder and under the other Loan Documents and has secured all of its
obligations hereunder and under the other Loan Documents by granting a First
Priority pledge of the Master Note, together with all security interest in all
other assets of the Company and a First Priority pledge of the Capital Stock
of Finance Sub, pursuant to the Company Pledge and Security Agreement;
WHEREAS, each of the Restricted Subsidiaries of Finance Sub has
guaranteed the Obligations of Finance Sub hereunder and under the other Loan
Documents with respect to the Series A Revolving Loans; and
WHEREAS, each of Finance Sub and the Subsidiary Guarantors have
secured all of their respective Obligations under the Loan Documents with
respect to the Series A Revolving Loans by granting to Administrative Agent,
on behalf of Lenders, a First Priority pledge of all of the Capital Stock of
each of its Restricted Subsidiaries and all of their other assets, pursuant to
the Finance Sub and Other Subsidiary Pledge and Security Agreement;
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Borrowers, Lenders and Agents agree
as follows:
SECTION 1.
DEFINITIONS
1.1 CERTAIN DEFINED TERMS.
The following terms used in this Agreement shall have the following
meanings:
"ACSI" means ACSI Network Technologies, Inc.
"ACSI ESCROW AGREEMENT" means an escrow agreement in the
form of Exhibit X annexed hereto (other than solely with respect to
the provisions relating to the indemnification of, expense
reimbursement of, exculpation of, or compensation of, the escrow
agent thereunder, to the extent such provisions as so modified are
reasonable and customary).
"ACSI ESCROW FUNDS" means Cash and Cash Equivalents held in
an escrow account which has been established to hold a portion of the
proceeds from an ACSI Network Sale permitted under this Agreement
pursuant to an ACSI Escrow Agreement; provided that the sole
condition to the delivery of such Cash and Cash Equivalents to
Company or its Restricted Subsidiaries is the delivery of UCC-3
release statements with respect to the assets subject to such ACSI
Network Sale by Administrative Agent in accordance with subsection
8.6.
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"ACSI NETWORK SALES" means Asset Sales by ACSI in the
ordinary course of its business of designing and constructing
networks for sale to other Persons.
"ADDITIONAL NOTES" means unsecured subordinated notes issued
by Company after the Restatement Effective Date which (i) have terms
that are no more restrictive to Company and its Subsidiaries
(including without limitation in terms of covenants, events of
default, grace periods and other rights granted to the holders
thereof) than the Existing Senior Notes, (ii) have no required Cash
payments of principal until after the Series C Maturity Date and no
required Cash payments of interest until the date two years after the
Restatement Effective Date, (iii) are not guaranteed by any
Subsidiary of Company, (iv) have a maturity not sooner than six
months after the Series C Maturity Date, and (v) are contractually
subordinated to the Obligations on terms satisfactory to and approved
by Requisite Lenders (including without limitation payment blockage
rights).
"ADJUSTED EURODOLLAR RATE" means, for any Interest Rate
Determination Date with respect to an Interest Period for a
Eurodollar Rate Loan, the rate per annum obtained by dividing (i) (a)
the per annum rate for deposits in Dollars for a period corresponding
to the duration of the relevant Interest Period which appears on
Telerate Page 3750 at approximately 11:00 a.m. (London time) on such
Interest Rate Determination Date or (b) if such rate does not appear
on Telerate Page 3750 on such Interest Rate Determination Date, the
per annum rate (rounded upward to the nearest 1/16 of 1%) at which
deposits in Dollars are offered by Administrative Agent to first
class banks in the London interbank market, in the approximate amount
of Administrative Agent's relevant Eurodollar Loan (which principal
amount shall be deemed to be $1,000,000 in the event Administrative
Agent is not making, converting to or continuing a Eurodollar Rate
Loan) and having a maturity approximately equal to such Interest
Period, at approximately 11:00 a.m. (London time) on such Interest
Rate Determination Date by (ii) a percentage equal to 100% minus the
stated maximum rate of all reserve requirements (including any
marginal, emergency, supplemental, special or other reserves)
applicable on such Interest Rate Determination Date to any member
bank of the Federal Reserve System in respect of "Eurocurrency
liabilities" as defined in Regulation D (or any successor category of
liabilities under Regulation D). The reference to Telerate Page 3750
in this definition shall be construed to be a reference to the
relevant page or any other page that may replace such page on the
Telerate service or any other service that may be nominated by the
British Bankers' Association as the information vendor for the
purpose of displaying British Bankers' Association Interest
Settlement Rate for deposit in Dollars.
"ADMINISTRATIVE AGENT" has the meaning assigned to that term
in the introduction to this Agreement and also means and includes any
successor Administrative Agent appointed pursuant to subsection 8.5A.
"AFFECTED LENDER" has the meaning assigned to that term in
subsection 2.6C.
"AFFILIATE", as applied to any Person, means any other
Person directly or indirectly controlling, controlled by, or under
common control with, that Person. For the purposes of this
definition, "control" (including, with correlative meanings, the
terms "controlling", "controlled by" and "under common control
with"), as applied to any
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Person, means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by
contract or otherwise.
"AGENT" means, individually, each of Arranger, Syndication
Agent, Documentation Agent, Collateral Agent and Administrative Agent
and "AGENTS" means Arranger, Syndication Agent, Documentation Agent,
Collateral Agent and Administrative Agent, collectively.
"AGREEMENT" means this First Amended and Restated Credit
Agreement dated as of September 19, 2000, as it may be amended,
supplemented or otherwise modified from time to time.
"APPLICABLE MARGIN" means (i) with respect to Series C Term
Loans, 5.00% for Eurodollar Rate Loans and 4.00% for Base Rate Loans
and (ii) with respect to Series A Revolving Loans and Series B Term
Loans (a) 4.50% for Eurodollar Rate Loans and 3.50% for Base Rate
Loans.
"ARRANGER" has the meaning assigned to that term in the
introduction to this Agreement.
"ASSET SALE" means the sale, conveyance, transfer,
assignment or other disposition by Company or any of its Restricted
Subsidiaries to any Person other than Company or any of its
Restricted Subsidiaries of (i) any of the Capital Stock of any
Restricted Subsidiary, (ii) substantially all of the assets of any
division or line of business of Company or any Restricted Subsidiary,
or (iii) any other assets (whether tangible or intangible including
without limitation duct or fiber sales made from non-switched cities)
of Company or any Restricted Subsidiary other than assets sold in the
ordinary course of business to the extent the aggregate value of such
assets sold in any single transaction or related series of
transactions does not exceed $150,000. Notwithstanding anything
herein to the contrary, dispositions of assets pursuant to Use
Agreements shall constitute Asset Sales.
"ASSIGNMENT AGREEMENT" means an Assignment Agreement in
substantially the form of Exhibit XI annexed hereto.
"BNY" has the meaning assigned to that term in the
introduction to this Agreement.
"BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any
successor statute.
"BASE RATE" means, at any time, the higher of (i) the Prime
Rate or (ii) the rate which is 1/2 of 1% in excess of the Federal
Funds Effective Rate.
"BASE RATE LOANS" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection
2.2A.
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"BRIDGE PREFERRED" means the 30% Exchangeable Preferred
Stock issued by Company on or after the date hereof in accordance
with subsection 6.8(v).
"BUSINESS DAY" means (i) for all purposes other than as
covered by clause (ii) below, any day excluding Saturday, Sunday and
any day which is a legal holiday under the laws of the State of New
York or is a day on which banking institutions located in such state
are authorized or required by law or other governmental action to
close, and (ii) with respect to all notices, determinations, fundings
and payments in connection with the Adjusted Eurodollar Rate or any
Eurodollar Rate Loans, any day that is a Business Day described in
clause (i) above and that is also a day for trading by and between
banks in Dollar deposits in the interbank eurodollar market.
"CAPITAL LEASE OBLIGATION" of any Person means the
obligation to pay rent or other payment amounts under a lease of (or
other indebtedness arrangement conveying the right to use) real or
personal property of such Person which is required to be classified
and accounted for as a capital lease or a liability on the face of a
balance sheet of such Person prepared in accordance with GAAP and the
stated maturity thereof shall be the date of the last payment of rent
or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a
penalty.
"CAPITAL STOCK" means, (i) in the case of a corporation,
corporate stock, (ii) in the case of an association or business
entity, any and all shares, interests, participations, rights or
other equivalents (however designated) of corporate stock, (iii) in
the case of a partnership, partnership interests, whether general or
limited, (iv) in the case of a limited liability company, membership
interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of,
or distribution of assets of, the issuing Person.
"CASH" means money, currency or a credit balance in a
Deposit Account.
"CASH BALANCE REQUIREMENT" means, as of any date of
determination, the Cash Balances of the Company and its Restricted
Subsidiaries shall be at least an amount equal to (i) $20,000,000 for
the 30-day period following the Restatement Effective Date and
$30,000,000 thereafter plus (ii) the aggregate amount of accrued and
unpaid Cash interest on the Loans and the Existing Senior Notes.
"CASH BALANCES" means, with respect to any Person, as of any
date of determination, the aggregate Dollar amount of Cash and Cash
Equivalents held by such Person, minus (i) any Cash or Cash
Equivalents held in an escrow or other restricted accounts, including
without limitation permitted collateral accounts securing obligations
other than the Obligations and (ii) accounts payable more than 60
days past due; provided, that for purposes of determining the Cash
Balances of Company and its Restricted Subsidiaries, (a) from and
after the date 60 days after the Restatement Effective Date, Cash
Balances shall include only such Cash and Cash Equivalents held in
Deposit Accounts subject to Collateral Account Agreements in
accordance with subsection 5.11 and (b) notwithstanding anything in
clauses (i) or (a) of this definition to
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the contrary, from and after the UCC-3 Required Delivery Date, Cash
Balances shall include ACSI Escrow Funds in an amount not to exceed
$10,000,000.
"CASH EQUIVALENTS" means, as at any date of determination,
(i) securities issued or directly and fully guaranteed or insured by
the United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States of
America is pledged in support thereof); (ii) time deposits and
certificates of deposit of any commercial bank organized in the
United States having capital and surplus in excess of $500,000,000
with a maturity date not more than one year from the date of
acquisition; (iii) repurchase obligations with a term of not more
than seven days for underlying security of the types described in
clause (i) above entered into with any bank meeting the qualification
specified in clause (ii) above; (iv) direct obligations issued by any
state of the United States of America or any political subdivision of
any such state or any public instrumentality thereof maturing, or
subject to tender at the option of the holder thereof within 90
calendar days after the date of acquisition thereof and, at the time
of acquisition, having a rating of A or better from Standard & Poor's
Ratings Group ("STANDARD & POOR'S") or A-2 or better from Moody's
Investors Service, Inc. ("MOODY'S"); (v) commercial paper issued by
the parent corporation of any commercial bank organized in the United
States having capital and surplus in excess of $500,000,000 and
commercial paper issued by others having one of the two highest
ratings obtainable from either Standard & Poor's or Moody's and in
each case maturing within 90 days after the date of acquisition; (vi)
overnight bank deposits and bankers acceptances at any commercial
bank organized in the United States having capital and surplus in
excess of $500,000,000; (vii) deposits available for withdrawal on
demand with a commercial bank organized in the United States having
capital and surplus in excess of $500,000,000; and (viii) investments
in money market funds substantially all of whose assets comprise
securities of the types described in clauses (i) through (vii).
"CERTIFICATES OF DESIGNATION" means, collectively, (i) the
Certificate of Designation of the Powers, Preferences and Relative,
Participating, Optional and Other Special Rights of 14.75% Redeemable
Preferred Stock due 2008 and Qualifications, Limitations and
Restrictions Thereof, (ii) the Certificate of Designation of the
Powers, Preferences and Relative, Participating, Optional and Other
Special Rights of Preferred Stock and Qualifications, Limitations and
Restrictions Thereof of 12 3/4% Series A Junior Redeemable Preferred
Stock Due 2009 and 12 3/4% Series B Junior Redeemable Preferred Stock
Due 2009, in each case of Company, (iii) the Certificate of
Designation of the Series A Convertible Preferred Stock, (iv) the
certificate of designation of the Bridge Preferred, (v) any
certificate of designation for the Committed Preferred and (vi) the
certificates of designation for any preferred stock issued in the
future by Company in accordance with subsection 6.8(v).
"CERTIFICATE RE NON-BANK STATUS" means a certificate
substantially in the form of Exhibit XII annexed hereto delivered by
a Lender to Administrative Agent pursuant to subsection 2.7B(iii).
"CLOSING DATE" means August 11, 1999, the date of the
closing of the Original Credit Agreement.
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"COLLATERAL" means, collectively, all of the real, personal
and mixed property (including Capital Stock) of Loan Parties in which
Liens are purported to be granted pursuant to the Collateral
Documents as security for the Obligations.
"COLLATERAL ACCOUNT AGREEMENT" means (i) a blocked account
agreement for Deposit Accounts in substantially the form of Exhibit
VII annexed hereto, (ii) a collateral account agreement for
securities accounts in substantially the form of Exhibit XVII annexed
hereto, and (iii) any other collateral account agreement or cash
management letter, in each case executed and delivered by a Loan
Party and Administrative Agent, as any such agreement may be amended,
supplemented or otherwise modified from time to time.
"COLLATERAL DOCUMENTS" collectively, the Company Pledge and
Security Agreement, the Finance Sub Intercompany Pledge and Security
Agreement, the Finance Sub and Other Subsidiary Pledge and Security
Agreement, the Intercompany Pledge and Security Agreement, any
Collateral Account Agreement and all other instruments or documents
delivered by any Loan Party pursuant to the Original Credit
Agreement, this Agreement or any of the other Loan Documents, in
order to grant to Administrative Agent, on behalf of Lenders, or to
another Loan Party, a lien on any real, personal or mixed property of
such Loan Party as security for the Obligations or any obligations of
such Loan Party under the Master Note or Intercompany Purchase Money
Note.
"COMMITTED PREFERRED" means up to $124,300,000 of
convertible preferred stock of Company issued in accordance with
subsection 6.8(v) to the Investors or other investors at least one of
whom has committed to purchase such preferred stock from Company
resulting in gross proceeds to Company of $124,300,000; provided that
the gross proceeds received by Company upon the issuance of the
Bridge Preferred shall be included in the calculation of the
$124,300,000 (without giving effect to any Accreted Amounts as
defined in the Bridge Preferred) upon the exchange of the Bridge
Preferred for Committed Preferred.
"COMMUNICATIONS ACT" means the Communications Act of 1934,
as amended (including, without limitation, the Telecommunications Act
of 1996), or any successor statute or statutes thereto, and all
Regulations thereunder, in each case as from time to time in effect.
"COMMUNICATIONS REGULATORY AUTHORITY" means the FCC, any
State PUC and any future federal, state or local communications
regulatory commission, agency, department, board or authority.
"COMPANY" has the meaning assigned to that term in the
introduction to this Agreement.
"COMPANY GUARANTY" means the Company Guaranty executed and
delivered by Company on the Closing Date, as such Company Guaranty
may thereafter be amended, supplemented or otherwise modified from
time to time.
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<PAGE> 16
"COMPANY PLEDGE AND SECURITY AGREEMENT" means the Company
Pledge and Security Agreement executed and delivered by Company on
the Closing Date, as such Company Pledge and Security Agreement may
thereafter be amended, supplemented or otherwise modified from time
to time.
"COMPLIANCE CERTIFICATE" means a certificate substantially
in the form of Exhibit VIII annexed hereto delivered to
Administrative Agent and Lenders by Company pursuant to subsection
5.1(iv).
"CONSOLIDATED ADJUSTED EBITDA" means, with respect to any
Person for any period, the sum for such Person for such period of
Consolidated Net Income plus, to the extent reflected in the income
statement of such Person for such period from which Consolidated Net
Income is determined, without duplication, (i) Consolidated Interest
Expense, (ii) provisions for taxes based on income, (iii) total
depreciation expense, (iv) total amortization expense, (v) any
non-cash expense related to the issuance to employees or
non-employees of such Person of Capital Stock or options to purchase
Capital Stock of such Person and (vi) any charge related to any
premium or penalty paid in connection with redeeming or retiring any
Indebtedness prior to its stated maturity and minus, (a) interest
income and (b) to the extent reflected in the income statement of
such Person for such period, any non-cash credits that have the
effect of increasing Consolidated Net Income of such Person for such
period, all of the foregoing as determined on a consolidated basis
for such Person and its Restricted Subsidiaries in conformity with
GAAP.
"CONSOLIDATED ANNUALIZED EBITDA" means, as of the last day
of any Fiscal Quarter, Consolidated Adjusted EBITDA for such Fiscal
Quarter multiplied by four.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period,
the sum of the aggregate of all expenditures (whether paid in cash or
other consideration or accrued as a liability and including Capital
Lease Obligations) by Company and its Restricted Subsidiaries during
that period that, in conformity with GAAP, are included in "additions
to property, plant or equipment" or comparable items reflected in the
consolidated statement of cash flows of Company and its Restricted
Subsidiaries.
"CONSOLIDATED CASH CAPITAL EXPENDITURES" means, for any
period, Consolidated Capital Expenditures for such period excluding,
however, any such expenditures not made in Cash.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period,
(i) Consolidated Interest Expense of Company and its Restricted
Subsidiaries for such period excluding, however, any interest expense
not payable in Cash (including amortization of discount and
amortization of debt issuance costs) plus (ii) cash dividends paid by
Company on the Preferred Stock.
"CONSOLIDATED CURRENT ASSETS" means, as at any date of
determination, the total assets of Company and its Subsidiaries on a
consolidated basis which may properly be
8
<PAGE> 17
classified as current assets in conformity with GAAP, excluding Cash
and Cash Equivalents.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries
on a consolidated basis which may properly be classified as current
liabilities in conformity with GAAP.
"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an
amount (if positive) equal to (i) the sum, without duplication, of
the amounts for such period of (a) Consolidated Adjusted EBITDA of
Company and its Restricted Subsidiaries and (b) the Consolidated
Working Capital Adjustment minus (ii) the sum, without duplication,
of the amounts for such period of (a) voluntary and scheduled
repayments of Consolidated Total Debt, (b) Consolidated Cash Capital
Expenditures (net of any proceeds of any related financings with
respect to such expenditures), (c) Cash paid to make
Telecommunications Acquisitions to the extent permitted by subsection
6.9, (d) Consolidated Cash Interest Expense, and (e) the provision
for current taxes based on income of Company and its Restricted
Subsidiaries and payable in Cash with respect to such period.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to such
Person, for any period, total interest expense (including Capital
Lease Obligations and capitalized interest) of such Person and its
Restricted Subsidiaries on a consolidated basis with respect to all
outstanding Indebtedness of such Person and its Restricted
Subsidiaries, including all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers'
acceptance financing and net costs under Interest Rate Agreements,
but excluding, however, any amounts referred to in subsection 2.3
payable to Agents and Lenders on or before the Closing Date.
"CONSOLIDATED NET INCOME" means, with respect to any Person,
for any period, the net income (or loss) of a Person and its
Restricted Subsidiaries on a consolidated basis for such period taken
as a single accounting period determined in conformity with GAAP;
provided that there shall be excluded from Consolidated Net Income
(i) the income (or loss) of any other Person (other than a Restricted
Subsidiary of such Person) in which any other Person (other than such
Person or any of its Restricted Subsidiaries) has a joint interest,
except to the extent of the amount of dividends or other
distributions actually paid to such Person or any of its Restricted
Subsidiaries by such other Person during such period, (ii) the income
(or loss) of any other Person accrued prior to the date it becomes a
Restricted Subsidiary of such Person or is merged into or
consolidated with such Person or any of its Restricted Subsidiaries
or that Person's assets are acquired by such Person or any of its
Restricted Subsidiaries, (iii) the income of any Restricted
Subsidiary of such Person to the extent that the declaration or
payment of dividends or similar distributions by that Restricted
Subsidiary of that income is not at the time permitted by operation
of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to
that Restricted Subsidiary, (iv) any after-tax gains or losses
attributable to Asset Sales or returned surplus assets of any Pension
Plan, and (v) (to the extent not included in clauses (i) through (iv)
above) any net extraordinary gains or net non-cash extraordinary
losses.
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<PAGE> 18
"CONSOLIDATED QUARTERLY REVENUES" means, with respect to any
Person, as at any date of determination, the aggregate stated income
statement amount of revenue of such Person and its Restricted
Subsidiaries for the applicable Fiscal Quarter, determined on a
consolidated basis in accordance with GAAP.
"CONSOLIDATED SENIOR DEBT" means, as at any date of
determination, the aggregate stated balance sheet amount of all
Indebtedness of Company and its Restricted Subsidiaries permitted to
be outstanding under subsections 6.1(i) and (vi), determined on a
consolidated basis in accordance with GAAP.
"CONSOLIDATED TOTAL DEBT" means, as at any date of
determination, the aggregate stated balance sheet amount of all
Indebtedness of Company and its Restricted Subsidiaries, determined
on a consolidated basis in accordance with GAAP.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess of Consolidated Current Assets over
Consolidated Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any
period on a consolidated basis, the amount (which may be a negative
number) by which Consolidated Working Capital as of the beginning of
such period exceeds (or is less than) Consolidated Working Capital as
of the end of such period.
"CONTINGENT OBLIGATION", as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person
(i) with respect to any Indebtedness, lease, dividend or other
obligation of another if the primary purpose or intent thereof by the
Person incurring the Contingent Obligation is to provide assurance to
the obligee of such obligation of another that such obligation of
another will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the
account of that Person or as to which that Person is otherwise liable
for reimbursement of drawings, or (iii) under Hedge Agreements.
Contingent Obligations shall include (a) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in
the ordinary course of business), co-making, discounting with
recourse or sale with recourse by such Person of the obligation of
another, (b) the obligation to make take-or-pay or similar payments
if required regardless of non-performance by any other party or
parties to an agreement, and (c) any liability of such Person for the
obligation of another through any agreement (contingent or otherwise)
(1) to purchase, repurchase or otherwise acquire such obligation or
any security therefor, or to provide funds for the payment or
discharge of such obligation (whether in the form of loans, advances,
stock purchases, capital contributions or otherwise) or (2) to
maintain the solvency or any balance sheet item, level of income or
financial condition of another if, in the case of any agreement
described under subclauses (1) or (2) of this sentence, the primary
purpose or intent thereof is as described in the preceding sentence.
The amount of any Contingent Obligation shall be deemed to be the
lower of (a) an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Contingent Obligation
is made and (b) the maximum amount for which such Person may be
liable pursuant to the terms of the instrument
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<PAGE> 19
creating such Contingent Obligation, unless such primary obligation
and maximum amount are not stated or determinable, in which case the
amount of such Contingent Obligation shall be the maximum reasonably
anticipated liability in respect to such Contingent Obligation.
"CONTRACTUAL OBLIGATION", as applied to any Person, means
any provision of any Security issued by that Person or of any
material indenture, mortgage, deed of trust, contract, undertaking,
agreement or other instrument to which that Person is a party or by
which it or any of its properties is bound or to which it or any of
its properties is subject.
"CURRENCY AGREEMENT" means any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic
cap or other similar agreement or arrangement to which Company or any
of its Subsidiaries is a party.
"CYBERGATE" means Cybergate, Inc., a Florida corporation.
"DEFERRED RESTRUCTURING FEE" has the meaning assigned to
that term in subsection 2.3C.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or
like account with a bank, savings and loan association, credit union
or like organization, other than an account evidenced by a negotiable
certificate of deposit.
"DOCUMENTATION AGENT" has the meaning assigned that term in
the introduction to this Agreement.
"DOLLARS" and the sign "$" mean the lawful money of the
United States of America.
"ELIGIBLE ASSIGNEE" means (i) (a) a commercial bank
organized under the laws of the United States or any state thereof;
(b) a savings and loan association or savings bank organized under
the laws of the United States or any state thereof; (c) a commercial
bank organized under the laws of any other country or a political
subdivision thereof; provided that (1) such bank is acting through a
branch or agency located in the United States or (2) such bank is
organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development or a political
subdivision of such country; and (d) any other entity which is an
"accredited investor" (as defined in Regulation D under the
Securities Act) which extends credit or buys loans as one of its
businesses including insurance companies, mutual funds and lease
financing companies; and (ii) any Lender, any Affiliate of any Lender
and, with respect to any Lender that is an investment fund that
invests in commercial loans, any other investment fund that invests
in commercial loans and that is managed or advised by the same
investment advisor as such Lender or by an Affiliate of such
investment advisor; provided that no Affiliate of Company shall be an
Eligible Assignee (other than the Huff Fund which shall be an
Eligible Assignee hereunder to the extent and only to the extent it
is required to purchase Loans pursuant to the Loan Put Agreement).
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<PAGE> 20
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is or was maintained or
contributed to by Company, any of its Subsidiaries or any of their
respective ERISA Affiliates.
"ENVIRONMENTAL CLAIM" means any investigation, written
notice, written notice of violation, claim, action, suit, proceeding,
written demand, written abatement order or other written order or
directive (conditional or otherwise), by any governmental authority
or any other Person, arising (i) pursuant to or in connection with
any actual or alleged violation of any Environmental Law, (ii) in
connection with any Hazardous Materials or any actual or alleged
Hazardous Materials Activity, or (iii) in connection with any actual
or alleged damage, injury, threat or harm to health, safety, natural
resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future
statutes, ordinances, orders, rules, regulations, judgments,
Governmental Authorizations, or any other requirements of
governmental authorities relating to (i) environmental matters,
including those relating to any Hazardous Materials Activity, (ii)
the generation, use, storage, transportation or disposal of Hazardous
Materials, or (iii) occupational safety and health, industrial
hygiene, land use or the protection of human, plant or animal health
or welfare as relating to the environment, in any manner applicable
to Company or any of its Subsidiaries or any Facility, including the
Comprehensive Environmental Response, Compensation, and Liability Act
(42 U.S.C. Section 9601 et seq.), the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), the
Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.),
the Clean Air Act (42 U.S.C. Section 7401 et seq.), the Toxic
Substances Control Act (15 U.S.C. Section 2601 et seq.), the Federal
Insecticide, Fungicide and Rodenticide Act (7 U.S.C. Section 136 et
seq.), the Occupational Safety and Health Act (29 U.S.C. Section 651
et seq.), the Oil Pollution Act (33 U.S.C. Section 2701 et seq.) and
the Emergency Planning and Community Right-to-Know Act (42 U.S.C.
Section 11001 et seq.), each as amended or supplemented, any
analogous present or future state or local statutes or laws, and any
regulations promulgated pursuant to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.
"ERISA AFFILIATE" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations
within the meaning of Section 414(b) of the Internal Revenue Code of
which that Person is a member; (ii) any trade or business (whether or
not incorporated) which is a member of a group of trades or
businesses under common control within the meaning of Section 414(c)
of the Internal Revenue Code of which that Person is a member; and
(iii) any member of an affiliated service group within the meaning of
Section 414(m) or (o) of the Internal Revenue Code of which that
Person, any corporation described in clause (i) above or any trade or
business described in clause (ii) above is a member.
"ERISA EVENT" means (i) a "reportable event" within the
meaning of Section 4043 of ERISA and the regulations issued
thereunder with respect to any Pension Plan
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<PAGE> 21
(excluding those for which the provision for 30-day notice to the
PBGC has been waived by regulation); (ii) the failure to meet the
minimum funding standard of Section 412 of the Internal Revenue Code
with respect to any Pension Plan (whether or not waived in accordance
with Section 412(d) of the Internal Revenue Code) or the failure to
make by its due date a required installment under Section 412(m) of
the Internal Revenue Code with respect to any Pension Plan or the
failure to make any required contribution to a Multiemployer Plan;
(iii) the provision by the administrator of any Pension Plan pursuant
to Section 4041(a)(2) of ERISA of a notice of intent to terminate
such plan in a distress termination described in Section 4041(c) of
ERISA; (iv) the withdrawal by Company, any of its Subsidiaries or any
of their respective ERISA Affiliates from any Pension Plan with two
or more contributing sponsors or the termination of any such Pension
Plan resulting in liability pursuant to Section 4063 or 4064 of
ERISA; (v) the institution by the PBGC of proceedings to terminate
any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan; (vi) the
imposition of liability on Company, any of its Subsidiaries or any of
their respective ERISA Affiliates pursuant to Section 4062(e) or 4069
of ERISA, by reason of the application of Section 4212(c) of ERISA or
on account of any liabilities arising by virtue of any former ERISA
Affiliate of Company or any of its Subsidiaries under ERISA or the
Code with respect to the period such entity was an ERISA Affiliate;
(vii) the withdrawal of Company, any of its Subsidiaries or any of
their respective ERISA Affiliates in a complete or partial withdrawal
(within the meaning of Sections 4203 and 4205 of ERISA) from any
Multiemployer Plan or the receipt by Company, any of its Subsidiaries
or any of their respective ERISA Affiliates of notice from any
Multiemployer Plan that it is in reorganization or insolvency
pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA;
(viii) the assertion of a material claim (other than routine claims
for benefits) against any Employee Benefit Plan other than a
Multiemployer Plan or the assets thereof, or against Company, any of
its Subsidiaries or any of their respective ERISA Affiliates in
connection with any Employee Benefit Plan; (ix) receipt from the
Internal Revenue Service of notice of the failure of any Pension Plan
(or any other Employee Benefit Plan intended to be qualified under
Section 401(a) of the Internal Revenue Code) to qualify under Section
401(a) of the Internal Revenue Code, or the failure of any trust
forming part of any Pension Plan to qualify for exemption from
taxation under Section 501(a) of the Internal Revenue Code; or (x)
the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of
the Internal Revenue Code or pursuant to ERISA with respect to any
Pension Plan.
"EURODOLLAR RATE LOANS" means Loans bearing interest at
rates determined by reference to the Adjusted Eurodollar Rate as
provided in subsection 2.2A.
"EVENT OF DEFAULT" means each of the events set forth in
Section 7.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
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<PAGE> 22
"EXISTING PREFERRED STOCK" means, collectively, the 12 3/4%
Junior Redeemable Preferred Stock due 2009 issued by Company and the
14 3/4% Redeemable Preferred Stock due 2008 issued by Company.
"EXISTING SENIOR NOTE INDENTURES" means the indentures
pursuant to which the Existing Senior Notes were issued, as such
indentures may be amended from time to time to the extent permitted
under subsection 6.15.
"EXISTING SENIOR NOTES" means Company's (i) $190,000,000 in
initial aggregate principal amount of 13% Senior Discount Notes due
2005, (ii) $120,000,000 in initial aggregate principal amount of 12
3/4% Senior Discount Notes due 2006, (iii) $220,000,000 in initial
aggregate principal amount of 13 3/4% Senior Notes due 2007, and (iv)
$375,000,000 in initial aggregate principal amount of 10.625% Senior
Discount Notes due 2008.
"FACILITIES" means any and all real property (including all
buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by Company or
any of its Subsidiaries or any of their respective predecessors or
Affiliates.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate equal for each day during such period to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by
Administrative Agent from three Federal funds brokers of recognized
standing selected by Administrative Agent.
"FINANCE SUB" has the meaning assigned to that term in the
introduction to this Agreement.
"FINANCE SUB AND OTHER SUBSIDIARY PLEDGE AND SECURITY
AGREEMENT" means, the Finance Sub and Other Subsidiary Pledge and
Security Agreement executed and delivered by Finance Sub and its
Subsidiaries on the Closing Date, annexed hereto, as such agreement
may be amended, supplemented or otherwise modified from time to time.
"FINANCE SUB INTERCOMPANY PLEDGE AND SECURITY AGREEMENT"
means the Finance Sub Intercompany Pledge and Security Agreement
executed and delivered by Finance Sub and Company on the Closing
Date, as such agreement may hereafter be amended, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 6.15.
"FINANCIAL PLAN" has the meaning assigned to that term in
subsection 5.1(xiii).
"FIRST PRIORITY" means, with respect to any Lien purported
to be created in any Collateral pursuant to any Collateral Document,
that (i) such Lien has priority over any other Lien on such
Collateral (other than Liens permitted pursuant to subsections
14
<PAGE> 23
6.2A(iii) and (iv)) and (ii) such Lien is the only Lien (other than
Permitted Encumbrances and Liens permitted pursuant to subsection
6.2) to which such Collateral is subject.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Company and its
Subsidiaries ending on December 31 of each calendar year. For
purposes of this Agreement, any particular Fiscal Year shall be
designated by reference to the calendar year in which such Fiscal
Year ends.
"FUNDING AND PAYMENT OFFICE" means (i) the office of
Administrative Agent located at One Wall Street, 16th Floor, New
York, New York 10268 or (ii) such other office of Administrative
Agent as may from time to time hereafter be designated as such in a
written notice delivered by Administrative Agent to Company and each
Lender.
"FUNDING DATE" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting
principles set forth in 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 in such other statements by such other
entity as may be approved by a significant segment of the accounting
profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"GANE" has the meaning assigned to that term in subsection
5.8C.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
authorization, plan, directive, consent order or consent decree of or
from any federal, state or local governmental authority, agency or
court.
"GSCP" means Goldman Sachs Credit Partners L.P., a Bermuda
limited partnership.
"HAZARDOUS MATERIALS" means (i) any chemical, material or
substance at any time defined as or included in the definition of
"hazardous substances", "hazardous wastes", "hazardous materials",
"extremely hazardous waste", "acutely hazardous waste", "radioactive
waste", "biohazardous waste", "pollutant", "toxic pollutant",
"contaminant", "restricted hazardous waste", "infectious waste",
"toxic substances", or any other term or expression intended to
define, list or classify substances by reason of properties harmful
to health, safety or the indoor or outdoor environment (including
harmful properties such as ignitability, corrosivity, reactivity,
carcinogenicity, toxicity, reproductive toxicity, "TCLP toxicity" or
"EP toxicity" or words of similar import under any applicable
Environmental Laws); (ii) any oil, petroleum, petroleum fraction or
petroleum derived substance; (iii) any drilling fluids, produced
waters and other wastes associated with the exploration, development
or production of crude oil, natural gas or geothermal resources; (iv)
any flammable substances or explosives; (v) any radioactive
materials; (vi) any asbestos-containing materials; (vii) urea
formaldehyde foam
15
<PAGE> 24
insulation; (viii) electrical equipment which contains any oil or
dielectric fluid containing polychlorinated biphenyls; (ix)
pesticides; and (x) any other chemical, material or substance,
exposure to which is prohibited, limited or regulated by any
governmental authority pursuant to Environmental Laws.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current, or
threatened activity, event or occurrence involving any Hazardous
Materials, including the use, manufacture, possession, storage,
holding, presence, existence, location, Release, threatened Release,
discharge, placement, generation, transportation, processing,
construction, treatment, abatement, removal, remediation, disposal,
disposition or handling of any Hazardous Materials, and any
corrective action or response action with respect to any of the
foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a
Currency Agreement designed to hedge against fluctuations in interest
rates or currency values, respectively.
"HUFF FUND" means The Huff Alternative Income Fund, L.P.
"HUFF PURCHASE AGREEMENT" means the purchase agreement
entered between the Huff Fund and Company pursuant to subsection
3.1I(i), as such purchase agreement may be amended from time to time
to the extent permitted under subsection 6.15.
"ICP" means the reportable segment of Company's business
identified as "Telecommunications" by Company in accordance with SFAS
No. 131.
"INDEBTEDNESS", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) all Capital Lease Obligations,
(iii) notes payable and drafts accepted representing extensions of
credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase
price of property or services (excluding any such obligations
incurred under ERISA), which purchase price is (a) due more than six
months from the date of incurrence of the obligation in respect
thereof or (b) evidenced by a note or similar written instrument, and
(v) all indebtedness secured by any Lien on any property or asset
owned or held by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person. Obligations under Interest
Rate Agreements and Currency Agreements constitute (1) in the case of
Hedge Agreements, Contingent Obligations, and (2) in all other cases,
Investments, and in neither case constitute Indebtedness.
"INDEMNITEE" has the meaning assigned to that term in
subsection 9.3.
"INTELLECTUAL PROPERTY" means all patents, trademarks,
tradenames, trade secrets, service marks, copyrights, technology,
know-how, formulae and processes used in or necessary for the conduct
of the business of Company and its Subsidiaries as currently
conducted that are material to the condition (financial or
otherwise), business or operations of Company and its Subsidiaries,
taken as a whole.
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<PAGE> 25
"INTERCOMPANY LOAN DOCUMENTS" means the Master Note, the
Intercompany Purchase Money Note, the Intercompany Note, the
Intercompany Pledge and Security Agreement and the Finance Sub
Intercompany Pledge and Security Agreement.
"INTERCOMPANY NOTE" means the promissory note executed by
Company and its Restricted Subsidiaries evidencing intercompany
Indebtedness (other than Indebtedness required to be evidenced by the
Master Note or Intercompany Purchase Money Notes), as such document
may be amended, supplemented or otherwise modified from time to time
to the extent permitted by subsection 6.15.
"INTERCOMPANY PLEDGE AND SECURITY AGREEMENT" means the
Intercompany Pledge and Security Agreement executed and delivered by
each Restricted Subsidiary on the Closing Date, and to be executed
and delivered by each new Restricted Subsidiary from time to time
thereafter in accordance with Subsection 5.8, annexed hereto, as such
document may be amended, supplemented or otherwise modified from time
to time to the extent permitted by subsection 6.15.
"INTERCOMPANY PURCHASE MONEY NOTE" means the promissory note
executed by the Restricted Subsidiaries in favor of Finance Sub
evidencing any and all loans made by Finance Sub to each Restricted
Subsidiary from proceeds of loans made by Company to Finance Sub
under the Master Note, as such document may be amended, supplemented
or otherwise modified from time to time to the extent permitted by
subsection 6.15.
"INTERCONNECTION AGREEMENT" means an agreement entered into
with an incumbent provider of local exchange telephone service in
accord with Sections 251 and 252 of the Communications Act.
"INTEREST PAYMENT ADJUSTMENT DATE" shall mean the earlier of
(i) the date the Liquidity Requirement is met or (ii) the date the
aggregate principal amount of the Loans outstanding is less than
$120,000,000.
"INTEREST PAYMENT DATE" means (i) with respect to any Base
Rate Loan, (a) prior to the Interest Payment Adjustment Date, the
last day of each calendar month and (b) after the Interest Payment
Adjustment Date, each March 31, June 30, September 30 and December 31
of each year, commencing on the first such date to occur after the
Interest Payment Adjustment Date, and (ii) with respect to any
Eurodollar Rate Loan, the last day of each Interest Period applicable
to such Loan; provided that prior to the Interest Payment Adjustment
Date, with respect to each Interest Period of longer than one month,
"Interest Payment Date" shall also include the last day of each month
following the commencement of such Interest Period.
"INTEREST PERIOD" has the meaning assigned to that term in
subsection 2.2B.
"INTEREST RATE AGREEMENT" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar
agreement or other similar agreement or arrangement to which Company
or any of its Restricted Subsidiaries is a party.
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"INTEREST RATE DETERMINATION DATE" means, with respect to
any Interest Period, the second Business Day prior to the first day
of such Interest Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter,
and any successor statute.
"INVENTORY" means, with respect to any Person as of any date
of determination, all goods, merchandise and other personal property
which are then held by such Person for sale or lease, including raw
materials and work in process.
"INVESTMENT" means (i) any direct or indirect purchase or
other acquisition by Company or any Restricted Subsidiary of, or of a
beneficial interest in, any Securities of any other Person (including
any Subsidiary of Company), (ii) any direct or indirect redemption,
retirement, purchase or other acquisition for value, by any
Subsidiary of Company from any Person other than Company or any of
its Subsidiaries, of any equity Securities of such Subsidiary, (iii)
any direct or indirect loan, advance or capital contribution by
Company or any of its Subsidiaries to any other Person, including all
indebtedness and accounts receivable from that other Person that are
not current assets or did not arise from sales to that other Person
in the ordinary course of business, or (iv) Interest Rate Agreements
or Currency Agreements not constituting Hedge Agreements. The amount
of any Investment shall be (a) the original cost of such Investment
plus (b) the cost of all additions thereto, without any adjustments
for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment minus (c) the lesser of
(1) the aggregate amount of any repayments, redemptions, dividends or
other distributions thereon or proceeds from the sale thereof, in
each case to the extent of any Cash payments (including any Cash
received by way of deferred payment pursuant to, or by monetization
of, a note receivable or otherwise, but only as and when so received)
actually received by Company or any of its Restricted Subsidiaries in
connection therewith, and (2) the aggregate amount described in the
immediately preceding clauses (a) and (b).
"INVESTORS" means the Huff Fund, Greenwich Street Capital
Partners II, L.P., GSCP Offshore Fund, L.P., Greenwich Fund, L.P.,
Greenwich Street Employee Fund, L.P., TRV Executive Fund, L.P., and
The Honeywell International Inc. Master Retirement Trust.
"JOINT VENTURE" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal
form; provided that in no event shall any corporate Subsidiary of any
Person be considered to be a Joint Venture to which such Person is a
party.
"LENDER" and "LENDERS" means the persons identified as
"Lenders" and listed on the signature pages of this Agreement,
together with their successors and permitted assigns pursuant to
subsection 9.1.
"LEVERAGE RATIO" means, as of the last day of any Fiscal
Quarter, the ratio of (i) Consolidated Total Debt to (ii)
Consolidated Annualized EBITDA, in each case as set
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forth in the most recent Compliance Certificate delivered by Company
to Administrative Agent pursuant to clause (iii) of subsection 5.1.
"LICENSES" means all licenses, authorizations,
certifications, waivers and permits required from any Communications
Regulatory Authority acting under the Communications Act or State
Law.
"LIEN" means any lien (statutory or otherwise), mortgage,
pledge, hypothecation, assignment, security interest, charge or
encumbrance of any kind (including any conditional sale or other
title retention agreement, any lease in the nature thereof, and any
agreement to give any security interest) and any option, trust or
other priority or preferential arrangement having the practical
effect of any of the foregoing.
"LIQUIDITY REQUIREMENT" means the receipt by Company, in
addition to the Required Junior Capital, of at least (i) $100,000,000
in net Cash proceeds from the issuance and sale of Qualified
Additional Capital on or before March 31, 2001 plus (ii) an
additional $100,000,000 in net Cash proceeds from the issuance and
sale of Qualified Additional Capital on or before September 30, 2001.
"LOAN" or "LOANS" means one or more of the Series A
Revolving Loans, Series B Term Loans or Series C Term Loans, or any
combination thereof.
"LOAN DOCUMENTS" means this Agreement, the Notes, the
Company Guaranty, the Subsidiary Guaranty, the Collateral Documents,
the Intercompany Loan Documents and the Loan Put Agreement.
"LOAN PARTY" means each of Finance Sub, Company and any
Restricted Subsidiaries from time to time executing a Loan Document,
and "LOAN PARTIES" means all such Persons, collectively.
"LOAN PUT AGREEMENT" means the Loan Put Agreement,
substantially in the form of Exhibit XIII annexed hereto, executed
and delivered by the Huff Fund, the Administrative Agent and the
Lenders on or prior to the Restatement Effective Date, as such Loan
Put Agreement may thereafter be amended, supplemented or otherwise
modified from time to time.
"MANAGEMENT SHARES" means shares of Capital Stock in Company
issued to management of Company from and after the Closing Date.
"MARGIN STOCK" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System
as in effect from time to time.
"MASTER NOTE" means the Master Note executed by Finance Sub
on the Closing Date in favor of Company to evidence any and all loans
made by Company to Finance Sub from the proceeds of Series B Term
Loans or Series C Term Loans annexed hereto, as such Master Note may
thereafter be amended, supplemented or otherwise modified from time
to time to the extent permitted by subsection 6.15.
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"MATERIAL ADVERSE EFFECT" means (i) a material adverse
effect upon the business, operations, properties, assets, condition
(financial or otherwise) or prospects of Company or any of its
Restricted Subsidiaries or (ii) the impairment of the ability of any
Loan Party to perform, or of Administrative Agent or Lenders to
enforce, the Obligations.
"MATERIAL CONTRACT" means any contract or other arrangement
to which Company or any of its Subsidiaries is a party (other than
the Loan Documents) for which breach, nonperformance, cancellation or
failure to renew would reasonably be expected to have a Material
Adverse Effect.
"MATURITY DATE" means (i) February 11, 2006 with respect to
the Series A Revolving Loans and Series B Term Loans and (ii) August
11, 2006 with respect to the Series C Term Loans; provided that, in
any case, the Maturity Date shall be (a) November 1, 2004, if Company
has not refinanced the 13% Senior Notes due 2005 by November 1, 2004
and (b) April 1, 2005, if Company has not refinanced the 12-3/4%
Senior Notes due 2006 by April 1, 2005.
"MAXIMUM CONSOLIDATED CASH CAPITAL EXPENDITURE AMOUNT" has
the meaning set forth in subsection 6.6C.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan which
is a "multiemployer plan" as defined in Section 3(37) of ERISA.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset
Sale, Cash payments (including any Cash received by way of deferred
payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) received from such Asset
Sale, net of any bona fide direct costs incurred in connection with
such Asset Sale, including (i) income taxes reasonably estimated to
be actually payable within two years of the date of such Asset Sale
as a result of any gain recognized in connection with such Asset Sale
and (ii) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Indebtedness (other than the
Loans) that is secured by a Lien on the stock or assets in question
and that is required to be repaid under the terms thereof as a result
of such Asset Sale.
"NET INSURANCE/CONDEMNATION PROCEEDS" means any Cash
payments or proceeds received by Company or any Restricted Subsidiary
(i) under any business interruption or casualty insurance policy in
respect of a covered loss thereunder or (ii) as a result of the
taking of any assets of Company or any Restricted Subsidiary by any
Person pursuant to the power of eminent domain, condemnation or
otherwise, or pursuant to a sale of any such assets to a purchaser
with such power under threat of such a taking, in each case net of
any actual and reasonable documented costs incurred by Company or any
Restricted Subsidiary in connection with the adjustment or settlement
of any claims of Company or such Restricted Subsidiary in respect
thereof.
"NON-RECOURSE INDEBTEDNESS" means Indebtedness as to which
(i) neither Company nor any of its Restricted Subsidiaries (a)
provides credit support (including any undertaking, agreement or
instrument that would constitute Indebtedness), (b) is directly
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<PAGE> 29
or indirectly liable (as a guarantor or otherwise)) or (c)
constitutes the lender and (ii) no default with respect to such
Indebtedness (including any rights which the holders thereof may have
to take enforcement action against the relevant Subsidiary or its
assets) would permit (upon notice, lapse of time or both) any holder
of any other Indebtedness of Company or its Restricted Subsidiaries
to declare a default on such other Indebtedness or cause the payment
thereof to be accelerated or payable prior to its stated maturity.
"NOTES" means one or more of the Series A Revolving Notes,
Series B Term Notes or Series C Term Notes, or any combination
thereof.
"NOTICE OF CONVERSION/CONTINUATION" means a notice
substantially in the form of Exhibit III annexed hereto delivered by
Company or Finance Sub, as the case may be, to Administrative Agent
pursuant to subsection 2.2D with respect to a proposed conversion or
continuation of the applicable basis for determining the interest
rate with respect to the Loans specified therein.
"OBLIGATIONS" means all obligations of every nature of each
Loan Party from time to time owed to Agents, Lenders or their
respective Affiliates or any of them under the Loan Documents,
whether for principal, interest (including interest that would become
due but for the operation of the automatic stay under Section 362(a)
of the Bankruptcy Code, 11 U.S.C. Section 362(a)), fees, expenses,
indemnification or otherwise.
"OFFICERS' CERTIFICATE" means, as applied to any
corporation, a certificate executed on behalf of such corporation by
its chairman of the board (if an officer) or its president or one of
its vice presidents and by its chief financial officer or its
treasurer; provided that every Officers' Certificate with respect to
the compliance with a condition precedent to the making of any Loans
hereunder shall include (i) a statement that the officer or officers
making or giving such Officers' Certificate have read such condition
and any definitions or other provisions contained in this Agreement
relating thereto, (ii) a statement that, in the opinion of the
signers, they have made or have caused to be made such examination or
investigation as is necessary to enable them to express an informed
opinion as to whether or not such condition has been complied with,
and (iii) a statement as to whether, in the opinion of the signers,
such condition has been complied with.
"ORIGINAL CREDIT AGREEMENT" has the meaning set forth in the
Recitals.
"ORGANIZATIONAL DOCUMENTS" means (i) with respect to any
corporation, its certificate or articles of incorporation and its
bylaws, (ii) with respect to any limited partnership, its certificate
of limited partnership and its partnership agreement, (iii) with
respect to any general partnership, its partnership agreement, (iv)
with respect to any limited liability company, its articles or
certificate of organization and its operating agreement and (v) with
respect to any other entity, its equivalent organizational, governing
documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
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"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal
Revenue Code or Section 302 of ERISA.
"PERMITTED ENCUMBRANCES" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or
412(n) of the Internal Revenue Code or by ERISA, any such Lien
relating to or imposed in connection with any Environmental Claim,
and any such Lien expressly prohibited by any applicable terms of any
of the Collateral Documents):
(i) Liens for taxes, assessments or
governmental charges or claims the payment of which is not,
at the time, required by subsection 5.3;
(ii) statutory Liens of landlords, statutory
Liens of banks and rights of set-off, statutory Liens of
carriers, warehousemen, mechanics, repairmen, workmen and
materialmen, and other Liens imposed by law, in each case
incurred in the ordinary course of business (a) for amounts
not yet overdue or (b) for amounts that are overdue and that
(in the case of any such amounts overdue for a period in
excess of 10 days) are being contested in good faith by
appropriate proceedings, so long as (1) such reserves or
other appropriate provisions, if any, as shall be required
by GAAP shall have been made for any such contested amounts,
and (2) in the case of a Lien with respect to any portion of
the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral on
account of such Lien;
(iii) Liens incurred or deposits made in the
ordinary course of business (a) in connection with workers'
compensation, unemployment insurance and other types of
social security, or (b) to secure the performance of
tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, trade contracts,
performance bonds (including standby letters of credit
issued in respect of such performance bonds) and
return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money)
provided that the amounts in respect of performance bonds
and standby letters of credit in respect of performance
bonds secured by such Liens do not in the aggregate exceed
$30,000,000, so long as no foreclosure, sale or similar
proceedings have been commenced with respect to any portion
of the Collateral on account thereof;
(iv) any attachment or judgment Lien not
constituting an Event of Default under subsection 7.8;
(v) leases or subleases granted to third
parties in accordance with any applicable terms of the
Collateral Documents and not interfering in any material
respect with the ordinary conduct of the business of Company
or any of its Subsidiaries or resulting in a material
diminution in the value of any Collateral as security for
the Obligations and rights granted to third parties under
Use Agreements;
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<PAGE> 31
(vi) easements, rights-of-way, restrictions,
encroachments, and other minor defects or irregularities in
title, in each case which do not and will not interfere in
any material respect with the ordinary conduct of the
business of Company or any of its Subsidiaries or result in
a material diminution in the value of any Collateral as
security for the Obligations;
(vii) any (a) interest or title of a lessor or
sublessor under a lease, (b) restriction or encumbrance that
the interest or title of such lessor or sublessor may be
subject to, or (c) subordination of the interest of the
lessee or sublessee under such lease to any restriction or
encumbrance referred to in the preceding clause (b), so long
as the holder of such restriction or encumbrance agrees to
recognize the rights of such lessee or sublessee under such
lease;
(viii) Liens arising from filing UCC financing
statements relating solely to leases permitted by this
Agreement;
(ix) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
customs duties in connection with the importation of goods;
(x) any zoning or similar law or right
reserved to or vested in any governmental office or agency
to control or regulate the use of any real property; and
(xi) Liens securing obligations (other than
obligations representing Indebtedness for borrowed money)
under operating, reciprocal easement or similar agreements
entered into in the ordinary course of business of Company
and its Subsidiaries.
"PERMITTED HOLDERS" means the Huff Fund, ING Equity
Partners, L.P.I., Apex Investment Fund I, L.P., Apex Investment Fund
II, L.P., The Productivity Fund II, L.P., George Schmitt, Acqua
Wellington, Promethean Investment Group and the respective Affiliates
(other than Company and its Restricted Subsidiaries) of each of the
foregoing.
"PERSON" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability
companies, limited liability partnerships, joint stock companies,
Joint Ventures, associations, companies, trusts, banks, trust
companies, land trusts, business trusts or other organizations,
whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political
subdivisions thereof) and agencies or other administrative or
regulatory bodies thereof.
"PLEDGED COLLATERAL" means, collectively, the "Pledged
Collateral" as defined in the Company Pledge and Security Agreement,
the Finance Sub and Other Subsidiary Pledge and Security Agreement,
and the Finance Sub Intercompany Pledge and Security Agreement.
"POTENTIAL EVENT OF DEFAULT" means a condition, act or event
that, with the giving of notice or lapse of time or both, would
constitute an Event of Default.
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"PRIME RATE" means the rate that BNY publicly announces from
time to time as its prime lending rate, as in effect from time to
time its Funding and Payment Office. The Prime Rate is a reference
rate and does not necessarily represent the lowest or best rate
actually charged to any customer. BNY or any other Lender may make
commercial loans or other loans at rates of interest at, above or
below the Prime Rate.
"PRO RATA SHARE" means (i) with respect to all payments,
computations and other matters relating to the Series A Revolving
Loans of any Lender, the percentage obtained by dividing (a) the
Series A Revolving Loan Exposure of that Lender by (b) the aggregate
Series A Revolving Loan Exposure of all Lenders, (ii) with respect to
all payments, computations and other matters relating to the Series B
Term Loan Commitment or the Series B Term Loans of any Lender the
percentage obtained by dividing (a) the Series B Term Loan Exposure
of that Lender by (b) the aggregate Series B Term Loan Exposure of
all Lenders, (iii) with respect to all payments, computations and
other matters relating to the Series C Term Loan Commitment or the
Series C Term Loans of any Lender, the percentage obtained by
dividing (a) the Series C Term Loan Exposure of that Lender by (b)
the aggregate Series C Term Loan Exposure of all Lenders, and (iv)
for all other purposes with respect to each Lender, the percentage
obtained by dividing (a) the sum of the Series A Revolving Loan
Exposure of that Lender plus the Series B Term Loan Exposure of that
Lender plus the Series C Term Loan Exposure of that Lender by (b) the
sum of the aggregate Series A Revolving Loan Exposure of all Lenders
plus the aggregate Series B Term Loan Exposure of all Lenders plus
the aggregate Series C Term Loan Exposure of all Lenders in any such
case as the applicable percentage may be adjusted by assignments
permitted pursuant to subsection 9.1. The Pro Rata Share of each
Lender as of the date of this Agreement for purposes of each of
clauses (i), (ii), (iii) and (iv) of the preceding sentence is set
forth opposite the name of that Lender in Schedule 2.1 annexed
hereto.
"PURCHASE MONEY DEBT ALLOWANCE" has the meaning given such
term in the Existing Senior Note Indentures.
"QUALIFIED ADDITIONAL CAPITAL" means the net Cash proceeds
received by Company from (i) the issuance of Capital Stock of the
Company in accordance with the terms of this Agreement, (ii) the
issuance of Additional Notes in accordance with the terms of this
Agreement, (iii) indebtedness incurred in accordance with subsection
6.1(vi) at any time after the Company has received the Required
Junior Capital (for purposes of this clause (iii), unfunded firm
commitments to provide Loans pursuant to executed loan or credit
agreements containing only customary funding conditions shall
constitute Qualified Additional Capital) or (iv) the aggregate amount
of Net Asset Sale Proceeds received after the Restatement Effective
Date which are permitted to be reinvested in Telecommunications
Assets pursuant to subsection 2.4(B)(iii)(a).
"REGISTER" has the meaning assigned to that term in
subsection 2.1D.
"REGULATION D" means Regulation D of the Board of Governors
of the Federal Reserve System, as in effect from time to time.
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"RELATED AGREEMENTS" means, collectively, (i) the Existing
Senior Note Indentures and Existing Senior Notes, (ii) the
Certificates of Designation and (iii) the Huff Purchase Agreement and
the Voting Agreement.
"RELATED TELECOMMUNICATIONS BUSINESS" means the business of
being an inter-exchange carrier, a competitive local exchange
carrier, an incumbent local exchange carrier, an internet service
provider, a long-distance reseller, a backbone data provider or a
data local exchange carrier, the business of designing, constructing,
selling and leasing of telecommunications network infrastructure or
the business of owning fiber for telecommunications purposes.
"RELEASE" means any release, spill, emission, leaking,
pumping, pouring, injection, escaping, deposit, disposal, discharge,
dispersal, dumping, leaching or migration of Hazardous Materials into
the indoor or outdoor environment (including the abandonment or
disposal of any barrels, containers or other closed receptacles
containing any Hazardous Materials), including the movement of any
Hazardous Materials through the air, soil, surface water or
groundwater.
"REQUISITE LENDERS" means Lenders having or holding more
than 50% of the sum of the aggregate Series A Revolving Loan Exposure
of all Lenders plus the aggregate Series B Term Loan Exposure of all
Lenders plus the aggregate Series C Term Loan Exposure of all
Lenders; provided, that the Huff Fund and its Affiliates shall be
excluded from the term "Lenders" for purposes of the definition of
Requisite Lenders.
"REQUIRED JUNIOR CAPITAL" means receipt by Company on or
after the date hereof of gross proceeds of $124,300,000 from the sale
and issuance of (i) the Committed Preferred, the Bridge Preferred or
other preferred stock of the Company issued in accordance with
subsection 6.8(v), provided that Company shall not be deemed to have
received any additional gross proceeds constituting Required Junior
Capital upon the exchange of the Bridge Preferred for Committed
Preferred, (ii) common stock or warrants for common stock of the
Company and/or (iii) Additional Notes that have no required Cash
payments until after the Series C Maturity Date.
"RESTATEMENT EFFECTIVE DATE" means the date on or before
September 20, 2000, upon which all of the conditions set forth in
Section 3 have been satisfied.
"RESTRICTED JUNIOR PAYMENT" shall mean (i) any dividend or
other distribution, direct or indirect, on account of any shares of
any class of stock of Company now or hereafter outstanding, except a
dividend payable solely in shares of that class of stock to the
holders of that class or in shares of common stock, (ii) any
redemption, retirement, sinking fund or similar payment, purchase or
other acquisition for value, direct or indirect, of any shares of any
class of stock of Company now or hereafter outstanding, (iii) any
payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of
any class of stock of Company now or hereafter outstanding, and (iv)
any payment or prepayment of principal of, premium, if any, or
interest on, or redemption, purchase, retirement, defeasance
(including
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<PAGE> 34
in-substance or legal defeasance), sinking fund or similar payment
with respect to any Subordinated Indebtedness, the Existing Senior
Notes or any Additional Notes.
"RESTRICTED SUBSIDIARY" means each direct and indirect
Subsidiary of Company (including Subsidiaries of Subsidiaries)
currently existing or hereafter formed or acquired which is not an
Unrestricted Subsidiary.
"RESTRUCTURING" means (i) the formation of Finance Sub as a
Wholly Owned Subsidiary of Company and (ii) the contribution by
Company to Finance Sub of all issued and outstanding Capital Stock of
the Restricted Subsidiaries.
"SEC" means the Securities and Exchange Commission and any
successor thereto.
"SECURITIES" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation
in any profit-sharing agreement or arrangement, options, warrants,
bonds, debentures, notes, or other evidences of indebtedness, secured
or unsecured, convertible, subordinated or otherwise, or in general
any instruments commonly known as "securities" or any certificates of
interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to
subscribe to, purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as
amended from time to time, and any successor statute.
"SERIES A CONVERTIBLE PREFERRED STOCK" means the convertible
preferred stock of Company with a stated value of $1,000 per share
issued pursuant to that certificate of designation filed with the
Secretary of State of the State of Delaware on March 3, 2000.
"SERIES A REVOLVING LOANS" means the Loans made by Lenders
to Finance Sub pursuant to subsection 2.1A(i) of the Original Credit
Agreement.
"SERIES A REVOLVING LOAN COMMITMENT" means the commitment of
a Lender to make a Series A Revolving Loan to Finance Sub pursuant to
subsection 2.1A(i) of the Original Credit Agreement, and "SERIES A
REVOLVING LOAN COMMITMENTS" means such commitments of all Lenders in
the aggregate.
"SERIES A REVOLVING LOAN EXPOSURE" means, with respect to
any Lender as of any date of determination, the aggregate outstanding
principal amount of the Series A Revolving Loans of that Lender.
"SERIES A REVOLVING LOAN NOTES" means any promissory notes
of Finance Sub issued pursuant to (i) subsection 2.1E(i) of the
Original Credit Agreement on the Closing Date or (ii) the last
sentence of subsection 9.1B(i) hereof or, if issued prior to the
Restatement Effective Date, of the Original Credit Agreement in
connection with assignments of the Series A Revolving Loans of any
Lenders, in each case substantially in the form of Exhibit IV annexed
hereto, as they may be amended, supplemented or otherwise modified
from time to time.
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<PAGE> 35
"SERIES B TERM LOAN COMMITMENT" means the commitment of a
Lender to make Series B Term Loans to Company pursuant to subsection
2.1A(ii) of the Original Credit Agreement, and "SERIES B TERM LOAN
COMMITMENTS" means such commitments of all Lenders in the aggregate.
"SERIES B TERM LOAN EXPOSURE" means, with respect to any
Lender as of any date of determination, the aggregate outstanding
principal amount of the Series B Term Loans of that Lender.
"SERIES B TERM LOANS" means the Loans made by Lenders to
Company pursuant to subsection 2.1A(ii) of the Original Credit
Agreement.
"SERIES B TERM NOTES" means any promissory notes issued by
Company pursuant to (i) subsection 2.1E(i) of the Original Credit
Agreement on the Closing Date or (ii) the last sentence of subsection
9.1B(i) hereof or, if issued prior to the Restatement Effective Date,
of the Original Credit Agreement in each case substantially in the
form of Exhibit V annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.
"SERIES C TERM LOAN COMMITMENT" means the commitment of a
Lender to make Series C Term Loans to Company pursuant to subsection
2.1A(iii) of the Original Credit Agreement, and "SERIES C TERM LOAN
COMMITMENTS" means such commitments of all Lenders in the aggregate.
"SERIES C TERM LOAN EXPOSURE" means, with respect to any
Lender as of any date of determination, the aggregate outstanding
principal amount of the Series C Term Loans of that Lender.
"SERIES C TERM LOANS" means the Loans made by Lenders to
Company pursuant to subsection 2.1A(iii) of the Original Credit
Agreement.
"SERIES C TERM NOTES" means any promissory notes issued by
Company pursuant to (i) subsection 2.1E(i) of the Original Credit
Agreement on the Closing Date or (ii) the last sentence of subsection
9.1B(i) hereof or, if issued prior to the Restatement Effective Date,
of the Original Credit Agreement in each case substantially in the
form of Exhibit VI annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.
"SOLVENT" means, with respect to any Person, that as of the
date of determination both (i) (a) the then fair saleable value of
the property of such Person is (1) greater than the total amount of
liabilities (including contingent liabilities) of such Person and (2)
not less than the amount that will be required to pay the probable
liabilities on such Person's then existing debts as they become
absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (b) such
Person's capital is not unreasonably small in relation to its
business or any contemplated or undertaken transaction; and (c) such
Person does not intend to incur, or believe (nor should it reasonably
believe) that it will incur, debts beyond its ability to pay such
debts as they become due; and (ii) such Person is "solvent" within
the meaning given that term
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<PAGE> 36
and similar terms under applicable laws relating to fraudulent
transfers and conveyances. For purposes of this definition, the
amount of any contingent liability at any time shall be computed as
the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be
expected to become an actual or matured liability.
"STATE LAW" means any state law pertaining to or regulating
intrastate and local telecommunications services, or any successor
statute or statutes thereto, and all State Regulations pursuant to
such State Law, in each case as from time to time in effect.
"STATE PUC" means any state public utility commission or any
other state commission, agency, department, board or authority with
responsibility for regulating intrastate and local telecommunications
services.
"STATE REGULATIONS" means all rules, regulations, written
policies, orders and decisions of any State PUC.
"STOCKHOLDER APPROVAL" means all requisite approvals of the
stockholders of Company for the issuance of the Committed Preferred.
"SUBORDINATED INDEBTEDNESS" means any Indebtedness of
Company subordinated in right of payment to the Obligations.
"SUBSEQUENT JUNIOR CAPITAL" means the net Cash proceeds
received by Company from the issuance and sale of (i) Additional
Notes issued in accordance with subsection 6.1(iii), (ii) common
stock of Company, and/or (iii) preferred stock of Company issued in
accordance with subsection 6.8(v), after the date on which both the
Liquidity Requirement has been met and Company has received the
Required Junior Capital.
"SUBSIDIARY" means, with respect to any Person, any
corporation, partnership, limited liability company, association,
joint venture or other business entity of which more than 50% of the
total voting power of shares of stock or other ownership interests
entitled (without regard to the occurrence of any contingency) to
vote in the election of the Person or Persons (whether directors,
managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof.
"SUBSIDIARY GUARANTOR" means any Restricted Subsidiary of
Company (other than Finance Sub) that executes and delivers a
counterpart of the Subsidiary Guaranty on the Closing Date or from
time to time thereafter pursuant to subsection 5.8.
"SUBSIDIARY GUARANTY" means the Subsidiary Guaranty executed
and delivered by existing Restricted Subsidiaries of Company on the
Closing Date and to be executed and delivered by additional
Restricted Subsidiaries of Company from time to time thereafter in
accordance with subsection 5.8, as such Subsidiary Guaranty may
hereafter be amended, supplemented or otherwise modified from time to
time.
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"SUPPLEMENTAL COLLATERAL AGENT" has the meaning assigned to
that term in subsection 9.1D.
"SYNDICATION AGENT" has the meaning assigned to that term in
the introduction to this Agreement.
"TAX" or "TAXES" means any present or future tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature and
whatever called, by whomsoever, on whomsoever and wherever imposed,
levied, collected, withheld or assessed; provided that "TAX ON THE
OVERALL NET INCOME" of a Person shall be construed as a reference to
a tax imposed by the jurisdiction in which that Person is organized
or in which that Person's principal office (and/or, in the case of a
Lender, its lending office) is located or in which that Person
(and/or, in the case of a Lender, its lending office) is deemed to be
doing business on all or part of the net income, profits or gains
(whether worldwide, or only insofar as such income, profits or gains
are considered to arise in or to relate to a particular jurisdiction,
or otherwise) of that Person (and/or, in the case of a Lender, its
lending office).
"TELECOMMUNICATIONS ACQUISITIONS" means acquisitions by
Finance Sub or its Restricted Subsidiaries of Persons principally
engaged in a Related Telecommunications Business, provided that the
Person acquired shall become a Wholly Owned Restricted Subsidiary and
a Subsidiary Guarantor.
"TELECOMMUNICATIONS ASSETS" means, with respect to any
Person, assets (including, without limitation, rights-of-way,
trademarks and licenses to use copyrighted material), that are
utilized by such Person, directly or indirectly, in a
Telecommunications Business. Telecommunications Assets shall include
stock, joint venture or partnership interests in another Person;
provided that substantially all of the assets of such other Person
consist of Telecommunications Assets.
"TELECOMMUNICATIONS BUSINESS" means the business of (i)
transmitting, or providing services relating to the transmission of,
voice, video or data through owned or leased transmission facilities,
(ii) creating, developing or marketing communications-related network
equipment, software and other devices for use in (i) above or (iii)
evaluating, participating or pursuing any other activity or
opportunity that is related to those specified in (i) or (ii) above.
"TOTAL GROSS CAPITALIZATION" means the (i) sum of (a)
Consolidated Total Debt plus (b) paid-in capital which shall include
(1) preferred stock and (2) stock issued to employees as compensation
in the ordinary course of business consistent with past practice but
shall exclude (3) additional equity issued as pay-in-kind dividends
on issued and outstanding equity securities and (4) any warrants for
equity securities issued in connection with Securities evidencing
Indebtedness and which shall be determined without giving effect to
any accumulated deficits resulting from operations minus (ii) the
aggregate cumulative amount of Investments made by Company or its
Restricted Subsidiaries from and after the Closing Date pursuant to
subsection 6.3(vii).
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"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"UCC-3 REQUIRED DELIVERY DATE" means, with respect to any
ACSI Network Sale, the fifth Business Day after the date the
Administrative Agent has received the notice, Officer's Certificate,
UCC-3 release statements, and the ACSI Escrow Agreement required
pursuant to subsection 8.6 in form and substance reasonably
satisfactory to Administrative Agent; provided that if any such
documents are not reasonably satisfactory to Administrative Agent,
Administrative Agent shall give written notice to the Company within
five Business Days after receipt thereof specifying in particular the
errors or omissions in such documents.
"UNRESTRICTED SUBSIDIARY" means (i) each direct and indirect
Subsidiary of Company which is designated as an Unrestricted
Subsidiary on Schedule 1.2 annexed hereto and (ii) each other
indirect Subsidiary of Company formed or acquired after the Closing
Date which is designated by the Board of Directors of Company as an
Unrestricted Subsidiary; provided, however, that in the case of each
of clauses (i) and (ii), (a) such Subsidiary has total assets of
$1,000 or less or the designation of such Subsidiary as an
Unrestricted Subsidiary is effective immediately upon such Person
becoming a Subsidiary of Company, (b) such Subsidiary has no
Indebtedness other than Non-Recourse Indebtedness, (c) neither
Company nor any Restricted Subsidiary is party to any agreement which
requires Company or any Restricted Subsidiary to maintain or preserve
such Subsidiary's financial condition or to cause such Subsidiary to
achieve any specified financial or operating results and (d) such
Subsidiary constitutes an "Unrestricted Subsidiary" under each
indenture pursuant to which Company has outstanding Indebtedness. If,
at any time, any Unrestricted Subsidiary would fail to meet any of
the foregoing requirements to constitute an Unrestricted Subsidiary,
it shall thereafter cease to be an Unrestricted Subsidiary and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a
Restricted Subsidiary as of such date. Notice of the designation of
any Subsidiary of Company as an Unrestricted Subsidiary shall be set
forth in an Officers' Certificate delivered to Administrative Agent.
"USE AGREEMENT" means any agreement pursuant to which
Company or any Restricted Subsidiary sells ownership rights to, or
rights to use (on an indefeasible right of use basis or otherwise),
fiber optic cable, fiber conduits, innerducts, switches or similar
assets.
"VOTING AGREEMENT" has the meaning assigned to that term in
subsection 3.1I(ii).
"VOTING STOCK" means, with respect to any Person, Capital
Stock of such Person which ordinarily has voting power for the
election of directors (or persons performing similar functions) of
such Person, whether at all times or only so long as no senior class
of securities has such voting power by reason of any contingency.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to
any Indebtedness at any date, the number of years obtained by
dividing (i) the sum of the product obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial
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maturity or other required payments of principal, including payment
at final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such
date and the making of such payment, by (ii) the then outstanding
principal amount of such Indebtedness.
"WHOLLY OWNED" means, with respect to any Person, a
Subsidiary of such Person all of the outstanding Capital Stock or
other equity interests (other than directors' qualifying shares) of
which shall at the time be owned by such Person or by one or more
Wholly Owned Subsidiaries of such Person or by such Person and one or
more Wholly Owned Subsidiaries of such Person.
1.2 ACCOUNTING TERMS; UTILIZATION OF GAAP FOR PURPOSES OF CALCULATIONS
UNDER AGREEMENT.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Company to Lenders pursuant to clauses (i), (ii),
(iii), (xiii) and (xxi) of subsection 5.1 shall be prepared in accordance with
GAAP as in effect from time to time (and delivered together with the
reconciliation statements provided for in subsection 5.1(v)). Calculations in
connection with the definitions, covenants and other provisions of this
Agreement shall utilize accounting principles and policies applicable to
Company and its Subsidiaries in accordance with GAAP as of the Restatement
Effective Date and in conformity with those used to prepare the financial
statements referred to in subsection 4.3. If there is any change in the
accounting principles and policies applicable to Company and its Subsidiaries
in accordance with GAAP after the date hereof, Borrowers and the Lenders may
(but shall not be obligated to) amend the definitions, covenants and other
provisions of this Agreement to take into account such changes in accounting
principles and policies.
1.3 OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION.
(A) Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.
(B) References to "Sections" and "subsections" shall be to Sections
and subsections, respectively, of this Agreement unless otherwise specifically
provided.
(C) The use herein of the word "include" or "including", when
following any general statement, term or matter, shall not be construed to
limit such statement, term or matter to the specific items or matters set
forth immediately following such word or to similar items or matters, whether
or not nonlimiting language (such as "without limitation" or "but not limited
to" or words of similar import) is used with reference thereto, but rather
shall be deemed to refer to all other items or matters that fall within the
broadest possible scope of such general statement, term or matter.
(D) Any reference to any agreement or instrument shall be deemed to
include a reference to such agreement or instrument as assigned, amended,
supplemented or otherwise modified from time to time in accordance with
subsection 6.15.
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SECTION 2.
AMOUNTS AND TERMS OF LOANS
2.1 LOANS; THE REGISTER; NOTES.
(A) LOANS. Each Lender has previously extended to Borrowers the Loans
as described in subsections 2.1A(i), 2.1A(ii) and 2.1A(iii).
(i) Series A Revolving Loans. Each Lender which had a
Series A Revolving Loan Commitment under the Original Credit
Agreement has loaned to Finance Sub an aggregate amount not exceeding
its Pro Rata Share of the aggregate amount of the Series A Revolving
Loan Commitments, which amount was used for the purposes identified
in subsection 2.5A. The amount of each Lender's outstanding Series A
Revolving Loan as of the Restatement Effective Date, after giving
effect to the borrowing of the Series A Revolving Loans referred to
in subsection 3.1O is set forth opposite its name on Schedule 2.1
annexed hereto and the aggregate amount of the Series A Revolving
Loan, after giving effect to such borrowing, is $35,000,000; provided
that the Series A Revolving Loans shall be adjusted to give effect to
any assignments of the Series A Revolving Loans pursuant to
subsection 9.1B. All outstanding Series A Revolving Loans and all
other amounts owed hereunder with respect to the Series A Revolving
Loans shall be paid in full no later than the Maturity Date. All
Series A Revolving Loans made under the Original Credit Agreement
shall continue under this Agreement. As of the Restatement Effective
Date, after giving effect to the borrowing of the Series A Revolving
Loans contemplated by subsection 3.1O, all Series A Revolving Loan
Commitments of the Lenders shall be terminated and amounts previously
borrowed under subsection 2.1A(i) of the Original Credit Agreement
and repaid may not be reborrowed.
(ii) Series B Term Loans. Each Lender which had a
Series B Term Loan Commitment under the Original Credit Agreement has
loaned to Company an aggregate amount not exceeding its Pro Rata
Share of the aggregate amount of the Series B Term Loan Commitments,
which amount was used for the purposes identified in subsection 2.5B.
The amount of each Lender's outstanding Series B Term Loan as of the
Restatement Effective Date, after giving effect to the prepayments
thereof referred to in subsections 3.1J and 3.1O, is set forth
opposite its name on Schedule 2.1 annexed hereto; provided that the
Series B Term Loans shall be adjusted to give effect to any
assignments of the Series B Term Loans pursuant to subsection 9.1B.
All Series B Term Loans and all other amounts owed hereunder with
respect to the Series B Term Loans shall be paid in full no later
than the Maturity Date. All outstanding Series B Term Loans made
under the Original Credit Agreement shall continue under this
Agreement. As of the Restatement Effective Date, all Series B Term
Loan Commitments of the Lenders shall be terminated and amounts
borrowed under subsection 2.1A(ii) of the Original Credit Agreement
and repaid may not be reborrowed.
(iii) Series C Term Loans. Each Lender which had a
Series C Term Loan Commitment under the Original Credit Agreement has
loaned to Company an aggregate amount not exceeding its Pro Rata
Share of the aggregate amount of the Series C Term Loan Commitments,
which amount was used for the purposes identified in subsection
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2.5B. The amount of each Lender's Series C Term Loan as of the
Restatement Effective Date, after giving effect to the prepayments
thereof referred to in Section 3.1J, is set forth opposite its name
on Schedule 2.1 annexed hereto; provided that the Series C Term Loan
of Lenders shall be adjusted to give effect to any assignments of the
Series C Term Loans pursuant to subsection 9.1B. All Series C Term
Loans and all other amounts owed hereunder with respect to the Series
C Term Loans shall be paid in full no later than the Maturity Date.
All outstanding Series C Term Loans made under the Original Credit
Agreement shall continue under this Agreement. Amounts borrowed
under subsection 2.1A(iii) of the Original Credit Agreement and
repaid may not be reborrowed.
(iv) Limitations on Loans. Anything contained in this
Agreement to the contrary notwithstanding, the Loans shall be subject
to the following limitations: (a) in no event shall the sum of the
aggregate principal amounts of Series B Term Loans and Series C Term
Loans outstanding exceed 80% of the cost of the acquisition,
construction or improvement of the Telecommunications Assets
acquired, constructed or improved with the proceeds of such Loans;
and (b) in no event shall the sum of the aggregate principal amounts
of Series B Term Loans and Series C Term Loans outstanding, plus the
aggregate amount of any Indebtedness outstanding in accordance with
subsection 6.1(vi), exceed the Purchase Money Debt Allowance.
(B) [INTENTIONALLY OMITTED]
(C) [INTENTIONALLY OMITTED]
(D) THE REGISTER.
(i) Administrative Agent shall maintain, at its address
referred to in subsection 9.7, a register for the recordation of the
names and addresses of Lenders and the Loans (whether or not
evidenced by a Note) of each Lender from time to time (the
"REGISTER"). The Register shall be available for inspection by
Borrowers or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register
the Series A Revolving Loans, Series B Term Loans and Series C Term
Loans from time to time of each Lender, and each repayment or
prepayment in respect of the principal amount of the Series A
Revolving Loans, Series B Term Loans or Series C Term Loans of each
Lender. Any such recordation shall be conclusive and binding on
Company and each Lender, absent manifest error; provided that failure
to make any such recordation, or any error in such recordation, shall
not affect Company's Obligations in respect of any applicable Loans.
(iii) Each Lender shall record on its internal records
(including the Notes held by such Lender) the amount of each Series A
Revolving Loan, Series B Term Loan and Series C Term Loan made by it
and each payment in respect thereof. Any such recordation shall be
conclusive and binding on Borrowers, absent manifest error; provided
that failure to make any such recordation, or any error in such
recordation, shall not affect either Borrower's Obligations in
respect of any applicable Loans; and
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provided, further that in the event of any inconsistency between the
Register and any Lender's records, the recordations in the Register
shall govern.
(iv) Borrowers, Administrative Agent and Lenders shall
deem and treat the Persons listed as Lenders in the Register as the
holders and owners of the corresponding Loans listed therein for all
purposes hereof, and no assignment or transfer of any such Loan shall
be effective, in each case unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted
by Administrative Agent and recorded in the Register as provided in
subsection 9.1B(ii). Prior to such recordation, all amounts owed
with respect to the applicable Loan shall be owed to the Lender
listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is listed in the
Register as a Lender shall be conclusive and binding on any
subsequent holder, assignee or transferee of the corresponding Loans.
(v) Each Borrower hereby designates BNY to serve as
such Borrower's agent solely for purposes of maintaining the Register
as provided in this subsection 2.1D, and Company hereby agrees that,
to the extent BNY serves in such capacity, BNY and its officers,
directors, employees, agents and affiliates shall constitute
Indemnitees for all purposes under subsection 9.3.
(E) NOTES. Upon request of any Lender, the applicable Borrower shall
execute and deliver to that Lender (or to Administrative Agent for that
Lender) (a) a Series A Revolving Loan Note substantially in the form of
Exhibit IV annexed hereto to evidence that Lender's Series A Revolving Loan,
in the principal amount of that Lender's Series A Revolving Loan and with
other appropriate insertions, (b) a Series B Term Note substantially in the
form of Exhibit V annexed hereto to evidence that Lender's Series B Term
Loans, in the principal amount of that Lender's Series B Term Loan and with
other appropriate insertions, and (c) a Series C Term Note substantially in
the form of Exhibit VI annexed hereto to evidence that Lender's Series C Term
Loans, in the principal amount of that Lender's Series C Term Loan and with
other appropriate insertions.
2.2 INTEREST ON THE LOANS.
(A) RATE OF INTEREST. Subject to the provisions of subsections 2.6
and 2.7, each Loan shall bear interest on the unpaid principal amount thereof
from the date made through maturity (whether by acceleration or otherwise) at
a rate determined by reference to the Base Rate or the Adjusted Eurodollar
Rate. The basis for determining the interest rate with respect to any Loan may
be changed from time to time pursuant to subsection 2.2D. If on any day a Loan
is outstanding with respect to which notice has not been delivered to
Administrative Agent in accordance with the terms of this Agreement specifying
the applicable basis for determining the rate of interest, then for that day
that Loan shall bear interest determined by reference to the Base Rate.
Subject to the provisions of subsections 2.2E and 2.7, the Loans
shall bear interest through maturity as follows:
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(i) if a Base Rate Loan, then at the sum of the Base
Rate plus the relevant Applicable Margin (as in effect from time to
time); or
(ii) if a Eurodollar Rate Loan, then at the sum of the
Adjusted Eurodollar Rate plus the relevant Applicable Margin (as in
effect from time to time during the applicable Interest Period).
(B) INTEREST PERIODS. In connection with each Eurodollar Rate Loan,
the applicable Borrower may, pursuant to the applicable Notice of
Conversion/Continuation select an interest period (each an "INTEREST PERIOD")
to be applicable to such Loan, which Interest Period shall be, at the
applicable Borrower's option, either a one-, two- or three-month period;
provided that:
(i) the initial Interest Period for any Eurodollar Rate
Loan shall commence on the Funding Date in respect of such Loan, in
the case of a Loan initially made as a Eurodollar Rate Loan, or on
the date specified in the applicable Notice of
Conversion/Continuation, in the case of a Loan converted to a
Eurodollar Rate Loan;
(ii) in the case of immediately successive Interest
Periods applicable to a Eurodollar Rate Loan continued as such
pursuant to a Notice of Conversion/Continuation, each successive
Interest Period shall commence on the day on which the next preceding
Interest Period expires;
(iii) if an Interest Period would otherwise expire on a
day that is not a Business Day, such Interest Period shall expire on
the next succeeding Business Day; provided that, if any Interest
Period would otherwise expire on a day that is not a Business Day but
is a day of the month after which no further Business Day occurs in
such month, such Interest Period shall expire on the next preceding
Business Day;
(iv) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of
such Interest Period) shall, subject to clauses (v), (vi) and (vii)
of this subsection 2.2B, end on the last Business Day of a calendar
month;
(v) no Interest Period with respect to any portion of
the Loans shall extend beyond the Maturity Date for such Loans;
(vi) no Interest Period with respect to any portion of
the Series A Revolving Loans shall extend beyond a date on which
Finance Sub is required to make a scheduled payment of principal on
the Series A Revolving Loans unless the sum of (a) the aggregate
principal amount of Series A Revolving Loans that are Base Rate Loans
plus (b) the aggregate principal amount of Series A Revolving Loans
that are Eurodollar Rate Loans with Interest Periods expiring on or
before such date equals or exceeds the principal amount required to
be paid on the Series A Revolving Loans on such date.
(vii) no Interest Period with respect to any portion of
the Series B Term Loans or Series C Term Loans shall extend beyond a
date on which Company is required to make a scheduled payment of
principal of the Series B Term Loans or Series C Term loans, as the
case may be, unless the sum of (a) the aggregate principal amount of
Series
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B Term Loans or Series C Term Loans, as the case may be, that are
Base Rate Loans plus (b) the aggregate principal amount of Series B
Term Loans or Series C Term Loans, as the case may be, that are
Eurodollar Rate Loans with Interest Periods expiring on or before
such date equals or exceeds the principal amount required to be paid
on the Series B Term Loans or Series C Term Loans, as the case may
be, on such date;
(viii) [Intentionally Omitted]
(ix) there shall be no more than ten (10) Interest
Periods outstanding at any time; and
(x) in the event a Borrower fails to specify an
Interest Period for any Eurodollar Rate Loan in the applicable Notice
of Conversion/Continuation, such shall be deemed to have selected an
Interest Period of one month.
Any Loan made prior to the Restatement Closing Date shall continue
with the Interest Period it had under the Original Credit Agreement subject to
the provisions of subsection 2.2D below.
(C) INTEREST PAYMENTS. Subject to the provisions of subsection 2.2E,
interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity).
(D) CONVERSION OR CONTINUATION. Subject to the provisions of
subsection 2.6, each Borrower shall have the option (i) to convert at any time
all or any part of its outstanding Loans equal to $5,000,000 and integral
multiples of $1,000,000 in excess of that amount from Loans bearing interest
at a rate determined by reference to one basis to Loans bearing interest at a
rate determined by reference to an alternative basis or (ii) upon the
expiration of any Interest Period applicable to a Eurodollar Rate Loan, to
continue all or any portion of such Loan equal to $5,000,000 and integral
multiples of $1,000,000 in excess of that amount as a Eurodollar Rate Loan;
provided, however, that a Eurodollar Rate Loan may only be converted into a
Base Rate Loan on the expiration date of an Interest Period applicable
thereto.
The applicable Borrower shall deliver a Notice of
Conversion/Continuation to Administrative Agent no later than 10:00 A.M. (New
York City time) at least one Business Day in advance of the proposed
conversion date (in the case of a conversion to a Base Rate Loan) and at least
three Business Days in advance of the proposed conversion/continuation date
(in the case of a conversion to, or a continuation of, a Eurodollar Rate
Loan). A Notice of Conversion/Continuation shall specify (i) the proposed
conversion/continuation date (which shall be a Business Day), (ii) the amount
and type of the Loan to be converted/continued, (iii) the nature of the
proposed conversion/continuation, (iv) in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan, the requested Interest Period, and
(v) in the case of a conversion to, or a continuation of, a Eurodollar Rate
Loan, that no Potential Event of Default or Event of Default has occurred and
is continuing. In lieu of delivering the above-described Notice of
Conversion/Continuation, such Borrower may give Administrative Agent
telephonic notice by the required time of any proposed conversion/continuation
under this subsection 2.2D;
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provided that such notice shall be promptly confirmed in writing by delivery
of a Notice of Conversion/Continuation to Administrative Agent on or before
the proposed conversion/continuation date. Upon receipt of written or
telephonic notice of any proposed conversion/continuation under this
subsection 2.2D, Administrative Agent shall promptly transmit such notice by
telefacsimile or telephone to each Lender.
Neither Administrative Agent nor any Lender shall incur any liability
to either Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of such
Borrower or for otherwise acting in good faith under this subsection 2.2D, and
upon conversion or continuation of the applicable basis for determining the
interest rate with respect to any Loans in accordance with this Agreement
pursuant to any such telephonic notice the applicable Borrower shall have
effected a conversion or continuation, as the case may be, hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of Conversion/Continuation for conversion to, or continuation of, a
Eurodollar Rate Loan (or telephonic notice in lieu thereof) shall be
irrevocable on and after the related Interest Rate Determination Date, and the
applicable Borrower shall be bound to effect a conversion or continuation in
accordance therewith.
(E) DEFAULT INTEREST. Any principal payments on the Loans not paid
when due and, to the extent permitted by applicable law, any interest payments
on the Loans or any fees or other amounts owed hereunder not paid when due, in
each case whether at stated maturity, by notice of prepayment, by acceleration
or otherwise, shall thereafter bear interest (including post-petition interest
in any proceeding under the Bankruptcy Code or other applicable bankruptcy
laws) payable on demand at a rate which is 2% per annum in excess of the
interest rate otherwise payable under this Agreement with respect to the
applicable Loans (or, in the case of any such fees and other amounts, at a
rate which is 2% per annum in excess of the interest rate otherwise payable
under this Agreement for Base Rate Loans); provided that, in the case of
Eurodollar Rate Loans, upon the expiration of the Interest Period in effect at
the time any such increase in interest rate is effective such Eurodollar Rate
Loans shall thereupon become Base Rate Loans and shall thereafter bear
interest payable upon demand at a rate which is 2% per annum in excess of the
interest rate otherwise payable under this Agreement for Base Rate Loans.
Payment or acceptance of the increased rates of interest provided for in this
subsection 2.2E is not a permitted alternative to timely payment and shall not
constitute a waiver of any Event of Default or otherwise prejudice or limit
any rights or remedies of Administrative Agent or any Lender.
(F) COMPUTATION OF INTEREST. Interest on the Loans shall be computed
(i) in the case of Base Rate Loans, on the basis of a 365-day or 366-day year,
as the case may be, and (ii) in the case of Eurodollar Rate Loans, on the
basis of a 360-day year, in each case for the actual number of days elapsed in
the period during which it accrues. In computing interest on any Loan, the
date of the making of such Loan or the first day of an Interest Period
applicable to such Loan or, with respect to a Base Rate Loan being converted
from a Eurodollar Rate Loan, the date of conversion of such Eurodollar Rate
Loan to such Base Rate Loan, as the case may be, shall be included, and the
date of payment of such Loan or the expiration date of an Interest Period
applicable to such Loan or, with respect to a Base Rate Loan being converted
to a Eurodollar
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Rate Loan, the date of conversion of such Base Rate Loan to such Eurodollar
Rate Loan, as the case may be, shall be excluded; provided that if a Loan is
repaid on the same day on which it is made, one day's interest shall be paid
on that Loan.
2.3 FEES.
(A) [INTENTIONALLY OMITTED]
(B) OTHER FEES. Borrowers agree to pay to Arranger and Administrative
Agent such other fees in the amounts and at the times separately agreed upon
between Company, Arranger and Administrative Agent.
(C) RESTRUCTURING FEE. Borrowers shall pay to Administrative Agent,
for distribution to Lenders executing this Agreement in accordance with their
Pro Rata Shares, a restructuring fee equal to 1.25% of the aggregate
outstanding principal amount of Loans (after giving effect to the prepayments
referred to in subsection 3.1J), 1.00% payable in Cash upon the Restatement
Effective Date and the remaining 0.25% payable from Net Asset Sale Proceeds
received following the Restatement Effective Date (such 0.25%, the "DEFERRED
RESTRUCTURING FEE").
2.4 PREPAYMENTS; GENERAL PROVISIONS REGARDING PAYMENTS; APPLICATION OF
PROCEEDS OF COLLATERAL AND PAYMENTS UNDER SUBSIDIARY GUARANTY.
(A) SCHEDULED REPAYMENTS OF LOANS.
(i) Scheduled Payments of Series A Revolving Loans.
Company shall make payments of principal on the Series A Revolving
Loans in installments on the dates and in the amounts set forth
below:
<TABLE>
<CAPTION>
SCHEDULED REPAYMENT
OF SERIES A REVOLVING
DATE LOANS
-------------------------- ------------------------------
<S> <C>
November 11, 2005 $12,500,000
-------------------------- ------------------------------
February 11, 2006 $22,500,000
-------------------------- ------------------------------
</TABLE>
; provided that each scheduled installment of principal of the Series
A Revolving Loans set forth above shall be reduced in connection with
any voluntary or mandatory repayments of the Series A Revolving Loans
in accordance with subsection 2.4B(iv).
(ii) Scheduled Payments of Series B Term Loans. Company
shall make payments of principal on the Series B Term Loans in
installments on the dates and in the amounts set forth below:
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<PAGE> 47
<TABLE>
<CAPTION>
DATE SCHEDULED REPAYMENT OF SERIES B TERM LOANS
------------------------------------- --------------------------------------------------
<S> <C>
November 11, 2003 $354,213
------------------------------------- --------------------------------------------------
February 11, 2004 $354,213
------------------------------------- --------------------------------------------------
May 11, 2004 $354,213
------------------------------------- --------------------------------------------------
August 11, 2004 $354,213
------------------------------------- --------------------------------------------------
November 11, 2004 $531,319
------------------------------------- --------------------------------------------------
February 11, 2005 $531,319
------------------------------------- --------------------------------------------------
May 11, 2005 $531,319
------------------------------------- --------------------------------------------------
August 11, 2005 $531,319
------------------------------------- --------------------------------------------------
November 11, 2005 $787,140.29
------------------------------------- --------------------------------------------------
</TABLE>
; provided that each scheduled installment of principal of the Series
B Term Loans set forth above shall be reduced in connection with any
voluntary or mandatory repayments of the Series B Term Loans in
accordance with subsection 2.4B(iv).
(iii) Scheduled Payments of Series C Term Loans. Company
shall make payments of principal on the Series C Term Loans in
installments on the dates and in the amounts set forth below:
<TABLE>
<CAPTION>
DATE SCHEDULED REPAYMENT OF SERIES C TERM LOANS
------------------------------------- --------------------------------------------------
<S> <C>
November 11, 2003 $249,176
------------------------------------- --------------------------------------------------
February 11, 2004 $249,176
------------------------------------- --------------------------------------------------
May 11, 2004 $249,176
------------------------------------- --------------------------------------------------
August 11, 2004 $249,176
------------------------------------- --------------------------------------------------
November 11, 2004 $249,176
------------------------------------- --------------------------------------------------
February 11, 2005 $249,176
------------------------------------- --------------------------------------------------
May 11, 2005 $249,176
------------------------------------- --------------------------------------------------
August 11, 2005 $249,176
------------------------------------- --------------------------------------------------
November 11, 2005 $249,176
------------------------------------- --------------------------------------------------
February 11, 2006 $249,176
------------------------------------- --------------------------------------------------
May 11, 2006 $249,176
------------------------------------- --------------------------------------------------
August 11, 2006 $96,929,795.71
------------------------------------- --------------------------------------------------
</TABLE>
39
<PAGE> 48
; provided that each scheduled installment of principal of the Series
C Term Loans set forth above shall be reduced in connection with any
voluntary or mandatory repayments of the Series C Term Loans in
accordance with subsection 2.4B(iv).
(B) PREPAYMENTS.
(i) Voluntary Prepayments. Borrowers may, upon not
less than one Business Day's prior written or telephonic notice, in
the case of Base Rate Loans, and three Business Days' prior written
or telephonic notice, in the case of Eurodollar Rate Loans, in each
case given to Administrative Agent by 12:00 Noon (New York City time)
on the date required and, if given by telephone, promptly confirmed
in writing to Administrative Agent (which original written or
telephonic notice Administrative Agent will promptly transmit by
telefacsimile or telephone to each Lender), at any time and from time
to time prepay any Loans on any Business Day in whole or in part in
an aggregate minimum amount of $5,000,000 and integral multiples of
$1,000,000 in excess of that amount; provided, however, that with
respect to any Eurodollar Rate Loan prepaid prior to the expiration
of the Interest Period applicable thereto, Borrowers shall pay all
amounts payable pursuant to subsection 2.6D. Notice of prepayment
having been given as aforesaid, the principal amount of the Loans
specified in such notice shall become due and payable on the
prepayment date specified therein. Any such voluntary prepayment
shall be applied as specified in subsection 2.4B(iv).
(ii) [Intentionally omitted].
(iii) Mandatory Prepayments. The Loans shall be prepaid
in the amounts and under the circumstances set forth below, all such
prepayments to be applied as set forth below or as more specifically
provided in subsection 2.4B(iv):
(a) Prepayments From Net Asset Sale Proceeds.
No later than the first Business Day following the date of
receipt by Company or any of its Restricted Subsidiaries of
any Net Asset Sale Proceeds in respect of any Asset Sale
(excluding ACSI Network Sales only to the extent the Net
Asset Sale Proceeds received from such Asset Sales are
accounted for as revenue (whether currently or on a deferred
basis) from continuing operations in accordance with GAAP),
Company or Finance Sub, as applicable, shall apply such Net
Asset Sale Proceeds first to pay the Deferred Restructuring
Fee to the full extent thereof, and second to prepay the
Loans. Notwithstanding the foregoing, as long as no Event
of Default or Potential Event of Default shall have occurred
and be continuing and the Deferred Restructuring Fee has
been paid in full, Company or Finance Sub, as applicable,
may reinvest within 270 days from the date of receipt
thereof up to 50% of the Net Asset Sale Proceeds in
Telecommunications Assets used by Company and its Restricted
Subsidiaries in the conduct of its business and to the
extent of the amount of Net Asset Sale Proceeds so
reinvested (up to such 50% limit) no prepayment of Loans
shall be required under this subsection 2.4(B)(iii)(a). If
upon any Asset Sale, Company elects to reinvest up to 50% of
the Net Asset Sale Proceeds as permitted under this
subsection 2.4B(iii)(a), (1) no later than the first
Business Day following the consummation of such Asset Sale,
40
<PAGE> 49
Company shall deliver an Officers' Certificate to
Administrative Agent demonstrating the derivation of the Net
Asset Sale Proceeds of such Asset Sale from the gross sales
prices thereof and certifying the portion of such proceeds
which Company elects to reinvest in Telecommunications
Assets and certifying that no Event of Default or Potential
Event of Default shall have occurred and be continuing and
(2) upon the expiration of 270 days after the date of
receipt of the Net Asset Sale Proceeds certified as being
scheduled for reinvestment, Company shall deliver to
Administrative Agent an Officers' Certificate indicating the
amount of Net Asset Sale Proceeds reinvested as of such
date, the assets in which such Net Asset Sale Proceeds have
been reinvested, and the amount of any remaining Net Asset
Sale Proceeds which shall be applied to prepay the Loans as
set forth in this subsection 2.4B(iii)(a).
(b) Prepayments from Net
Insurance/Condemnation Proceeds. No later than the second
Business Day following the date of receipt by Administrative
Agent or by Company or any of its Subsidiaries of any Net
Insurance/Condemnation Proceeds that are required to be
applied to prepay the Loans pursuant to the provisions of
subsection 5.4C, Company or Finance Sub, as applicable,
shall prepay the Loans in an aggregate amount equal to the
amount of such Net Insurance/Condemnation Proceeds.
(c) Prepayments from Consolidated Excess Cash
Flow. In the event that there shall be Consolidated Excess
Cash Flow for any Fiscal Year (commencing with Fiscal Year
2002), Company or Finance Sub, as applicable, shall, no
later than 100 days after the end of such Fiscal Year,
prepay the Loans in an aggregate amount equal to 75% of such
Consolidated Excess Cash Flow.
(d) Prepayments Due to Restrictions on Loans.
Company shall from time to time prepay the Series B Term
Loans and Series C Term Loans to the extent necessary to
give effect to the limitations set forth in subsection
2.1A(iv).
(e) Prepayments Due to Payments of Master
Note. Company shall, from time to time, prepay the Series B
Term Loans and the Series C Term Loans to the extent
necessary so that the aggregate outstanding amount of Series
B Term Loans and the Series C Term Loans shall not at any
time exceed the aggregate amount outstanding under the
Master Note.
(f) Calculations of Net Proceeds Amounts,
Additional Prepayments and Reductions Based on Subsequent
Calculations. Concurrently with any prepayment of the Loans
pursuant to subsections 2.4B(iii)(a)-(c), Company shall
deliver to Administrative Agent an Officers' Certificate
demonstrating the calculation of the amount (the "NET
PROCEEDS AMOUNT") of the applicable Net Asset Sale Proceeds
or Net Insurance/Condemnation Proceeds (as such terms are
defined in subsections 2.4B(iii)(a) and (b) respectively) or
the applicable Consolidated Excess Cash Flow, as the case
may be, that gave rise to such prepayment and/or reduction.
In the event that Company shall subsequently determine that
the actual Net Proceeds Amount was greater than the amount
set
41
<PAGE> 50
forth in such Officers' Certificate, Company or Finance Sub,
as applicable, shall promptly make an additional prepayment
of the Loans in an amount equal to the amount of such
excess, and Company shall concurrently therewith deliver to
Administrative Agent an Officers' Certificate demonstrating
the derivation of the additional Net Proceeds Amount
resulting in such excess.
(iv) Application of Prepayments.
(a) Application of Prepayments by Type of
Loans. Any amount (the "APPLIED AMOUNT") to be applied as a
voluntary prepayment pursuant to subsection 2.4B(i) or
mandatory prepayment pursuant to subsections
2.4B(iii)(a)-(c) shall be applied to reduce the aggregate
amount of Loans of Lenders in accordance with their Pro Rata
Shares (as determined pursuant to clause (iv) of the
definition thereof). With respect to each Lender's
outstanding Loans, prepayments shall be applied first, to
reduce such Lender's outstanding Series B Term Loans,
second, to reduce such Lender's Series C Term Loans and
third, to reduce such Lender's Series A Revolving Loans
(provided that the Lenders may agree among themselves to
reallocate prepayments otherwise payable to the Series A
Revolving Loans). Voluntary prepayments pursuant to
subsection 2.4B(i) shall be applied to reduce scheduled
installments of principal of the Series A Revolving Loans,
Series B Term Loans and Series C Term Loans on a pro rata
basis. Mandatory prepayments pursuant to subsection
2.4B(iii)(a)-(c) shall be applied to reduce scheduled
installments of principal of the Series A Revolving Loans,
Series B Term Loans and Series C Term Loans in inverse order
of maturity.
(b) Application of Prepayments to Base Rate
Loans and Eurodollar Rate Loans. Any prepayment of Loans
shall be applied first to Base Rate Loans to the full extent
thereof before application to Eurodollar Rate Loans, in each
case in a manner which minimizes the amount of any payments
required to be made pursuant to subsection 2.6D.
(v) Prepayment Fees. If any portion of the Series C
Term Loans is prepaid on or prior to the second anniversary of the
Closing Date, Company shall pay to Administrative Agent, for
distribution to Lenders having Series C Term Loans so prepaid in
accordance with their Pro Rata Shares, a fee equal to (1) 3.00% of
the principal amount of Series C Term Loans so prepaid during the
period commencing on the Closing Date and ending on the day prior to
the first anniversary of the Closing Date and (2) 2.00% of the
principal amount of Series C Term Loans so prepaid during the period
commencing on the first anniversary of the Closing Date and ending on
the second anniversary of the Closing Date; provided, however, that
such prepayment fees shall not be payable with respect to (a) the
prepayments made in accordance with subsections 3.1J and 3.1O, (b)
mandatory prepayments made pursuant to subsection 2.4B(iii)(a)-(c) or
(c) voluntary prepayments pursuant to subsection 2.4B(i) made within
90 days after the Restatement Effective Date.
42
<PAGE> 51
(C) GENERAL PROVISIONS REGARDING PAYMENTS.
(i) Manner and Time of Payment. All payments by each
Borrower of principal, interest, fees and other Obligations hereunder
and under the Notes shall be made in Dollars in same day funds,
without defense, setoff or counterclaim, free of any restriction or
condition, and delivered to Administrative Agent not later than 12:00
Noon (New York City time) on the date due at the Funding and Payment
Office for the account of Lenders; funds received by Administrative
Agent after that time on such due date shall be deemed to have been
paid by such Borrower on the next succeeding Business Day.
(ii) Application of Payments to Principal and Interest.
All payments in respect of the principal amount of any Loan shall
include payment of accrued interest on the principal amount being
repaid or prepaid, and all such payments shall be applied to the
payment of interest before application to principal.
(iii) Apportionment of Payments. Aggregate principal and
interest payments in respect of Loans shall be apportioned among all
outstanding Loans to which such payments relate, in each case
proportionately to Lenders' respective Pro Rata Shares, subject to
the provisions of subsection 2.4B(iv)(a). Administrative Agent shall
promptly distribute to each Lender, at its primary address set forth
below its name on the appropriate signature page hereof or at such
other address as such Lender may request, its Pro Rata Share of all
such payments received by Administrative Agent and the commitment
fees of such Lender when received by Administrative Agent pursuant to
subsection 2.3. Notwithstanding the foregoing provisions of this
subsection 2.4C(iii), if, pursuant to the provisions of subsection
2.6C, any Notice of Conversion/Continuation is withdrawn as to any
Affected Lender or if any Affected Lender makes Base Rate Loans in
lieu of its Pro Rata Share of any Eurodollar Rate Loans,
Administrative Agent shall give effect thereto in apportioning
payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to
be made hereunder shall be stated to be due on a day that is not a
Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the
computation of the payment of interest hereunder or of the commitment
fees hereunder, as the case may be.
(v) Notation of Payment. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation
thereon of all Loans evidenced by that Note and all principal
payments previously made thereon and of the date to which interest
thereon has been paid; provided that the failure to make (or any
error in the making of) a notation of any Loan made under such Note
shall not limit or otherwise affect the obligations of Borrowers
hereunder or under such Note with respect to any Loan or any payments
of principal or interest on such Note.
43
<PAGE> 52
(D) APPLICATION OF PROCEEDS OF COLLATERAL AND PAYMENTS UNDER
SUBSIDIARY GUARANTY.
(i) Application of Proceeds of Collateral. Except as
provided in subsection 2.4B(iii)(a) with respect to prepayments from
Net Asset Sale Proceeds, all proceeds received by Administrative
Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral under any
Collateral Document may, in the discretion of Administrative Agent,
be held by Administrative Agent as Collateral for, and/or (then or at
any time thereafter) applied in full or in part by Administrative
Agent against, the applicable Secured Obligations (as defined in such
Collateral Document) in the following order of priority:
(a) To the payment of all costs and expenses
of such sale, collection or other realization, including
reasonable compensation to Administrative Agent and its
agents and counsel, and all other expenses, liabilities and
advances made or incurred by Administrative Agent in
connection therewith, and all amounts for which
Administrative Agent is entitled to indemnification under
such Collateral Document and all advances made by
Administrative Agent thereunder for the account of the
applicable Loan Party, and to the payment of all costs and
expenses paid or incurred by Administrative Agent in
connection with the exercise of any right or remedy under
such Collateral Document, all in accordance with the terms
of this Agreement and such Collateral Document;
(b) thereafter, to the extent of any excess
such proceeds, to the payment of all other such Secured
Obligations for the ratable benefit of the holders thereof;
and
(c) thereafter, to the extent of any excess
such proceeds, to the payment to or upon the order of such
Loan Party or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may
direct.
(ii) Application of Payments Under Subsidiary Guaranty.
All payments received by Administrative Agent under the Subsidiary
Guaranty shall be applied promptly from time to time by
Administrative Agent in the following order of priority:
(a) To the payment of the costs and expenses
of any collection or other realization under the Subsidiary
Guaranty, including reasonable compensation to
Administrative Agent and its agents and counsel, and all
expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, all in
accordance with the terms of this Agreement and the
Subsidiary Guaranty;
(b) thereafter, to the extent of any excess
such payments, to the payment of all other Guarantied
Obligations (as defined in the Subsidiary Guaranty) for the
ratable benefit of the holders thereof; and
(c) thereafter, to the extent of any excess
such payments, to the payment to the applicable Subsidiary
Guarantor or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may
direct.
44
<PAGE> 53
(iii) Ratable Sharing of Proceeds of Collateral and
Subsidiary Guaranty. Any and all amounts received by Administrative
Agent in connection with the enforcement of any of the Collateral
Documents or the Subsidiary Guaranty or in connection with a
distribution in a bankruptcy, insolvency or similar proceeding to be
applied against any of the Obligations hereunder shall be shared
ratably by all Lenders hereunder in accordance with their Pro Rata
Shares (as determined pursuant to clause (iv) of the definition
thereof), irrespective of whether the Obligations of all Lenders or
only the Obligations of Lenders having outstanding Series A Revolving
Loans, Series B Term Loans or Series C Term Loans are secured by the
Collateral with respect to which such amounts are received or
guaranteed by the Subsidiary Guaranty.
2.5 USE OF PROCEEDS.
(A) SERIES A REVOLVING LOANS. The proceeds of the Series A Revolving
Loans were applied by Finance Sub for working capital and for other general
corporate purposes, including the financing of capital expenditures from time
to time.
(B) SERIES B TERM LOANS AND SERIES C TERM LOANS. The proceeds of the
Series B Term Loans and Series C Term Loans were applied by Company solely to
finance the acquisition, construction or improvement of Telecommunications
Assets of Company and its Restricted Subsidiaries; provided that Company used
all proceeds of any Series B Term Loans and Series C Term Loans to make
intercompany loans to Finance Sub pursuant to the Master Note which were
secured by the Finance Sub Pledge and Security Agreement, and Finance Sub in
turn made intercompany loans of such proceeds to the applicable Restricted
Subsidiary of Finance Sub pursuant to the Intercompany Purchase Money Note
which were secured by the Intercompany Pledge and Security Agreement.
(C) MARGIN REGULATIONS. No portion of the proceeds of any borrowing
under this Agreement was used by Company or any of its Subsidiaries in any
manner that might cause the borrowing or the application of such proceeds to
violate Regulation U, Regulation T or Regulation X of the Board of Governors
of the Federal Reserve System or any other regulation of such Board or to
violate the Exchange Act, in each case as in effect on the date or dates of
such borrowing and such use of proceeds.
2.6 SPECIAL PROVISIONS GOVERNING EURODOLLAR RATE LOANS.
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to Eurodollar
Rate Loans as to the matters covered:
(A) DETERMINATION OF APPLICABLE INTEREST RATE. As soon as practicable
after 10:00 A.M. (New York City time) on each Interest Rate Determination
Date, Administrative Agent shall determine (which determination shall, absent
manifest error, be final, conclusive and binding upon all parties) the
interest rate that shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable Interest Period and
shall promptly give notice thereof (in writing or by telephone confirmed in
writing) to Company or Finance Sub, as applicable, and each Lender.
45
<PAGE> 54
(B) INABILITY TO DETERMINE APPLICABLE INTEREST RATE. In the event
that Administrative Agent shall have determined (which determination shall be
final and conclusive and binding upon all parties hereto), on any Interest
Rate Determination Date with respect to any Eurodollar Rate Loans, that by
reason of circumstances affecting the interbank Eurodollar market adequate and
fair means do not exist for ascertaining the interest rate applicable to such
Loans on the basis provided for in the definition of Adjusted Eurodollar Rate,
Administrative Agent shall on such date give notice (by telefacsimile or by
telephone confirmed in writing) to Company or Finance Sub, as applicable, and
each Lender of such determination, whereupon (i) no Loans may be made as, or
converted to, Eurodollar Rate Loans until such time as Administrative Agent
notifies Company or Finance Sub, as applicable, and Lenders that the
circumstances giving rise to such notice no longer exist and (ii) any Notice
of Borrowing or Notice of Conversion/Continuation given by either Borrower
with respect to the Loans in respect of which such determination was made
shall be deemed to be rescinded by such Borrower.
(C) ILLEGALITY OR IMPRACTICABILITY OF EURODOLLAR RATE LOANS. In the
event that on any date any Lender shall have determined (which determination
shall be final and conclusive and binding upon all parties hereto but shall be
made only after consultation with Company and Administrative Agent) that the
making, maintaining or continuation of its Eurodollar Rate Loans (i) has
become unlawful as a result of compliance by such Lender in good faith with
any law, treaty, governmental rule, regulation, guideline or order (or would
conflict with any such treaty, governmental rule, regulation, guideline or
order not having the force of law even though the failure to comply therewith
would not be unlawful) or (ii) has become impracticable, or would cause such
Lender material hardship, as a result of contingencies occurring after the
date of this Agreement which materially and adversely affect the interbank
Eurodollar market, then, and in any such event, such Lender shall be an
"AFFECTED LENDER" and it shall on that day give notice (by telefacsimile or by
telephone confirmed in writing) to Borrowers and Administrative Agent of such
determination (which notice Administrative Agent shall promptly transmit to
each other Lender). Thereafter (a) the obligation of the Affected Lender to
make Loans as, or to convert Loans to, Eurodollar Rate Loans shall be
suspended until such notice shall be withdrawn by the Affected Lender, (b) to
the extent such determination by the Affected Lender relates to a Eurodollar
Rate Loan then being requested by a Borrower pursuant to a Notice of Borrowing
or a Notice of Conversion/Continuation, the Affected Lender shall make such
Loan as (or convert such Loan to, as the case may be) a Base Rate Loan, (c)
the Affected Lender's obligation to maintain its outstanding Eurodollar Rate
Loans (the "AFFECTED LOANS") shall be terminated at the earlier to occur of
the expiration of the Interest Period then in effect with respect to the
Affected Loans or when required by law, and (d) the Affected Loans shall
automatically convert into Base Rate Loans on the date of such termination.
Notwithstanding the foregoing, to the extent a determination by an Affected
Lender as described above relates to a Eurodollar Rate Loan then being
requested by a Borrower pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, such Borrower shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice
of Conversion/Continuation as to all Lenders by giving notice (by
telefacsimile or by telephone confirmed in writing) to Administrative Agent of
such rescission on the date on which the Affected Lender gives notice of its
determination as described above (which notice of rescission Administrative
Agent shall promptly transmit to each other Lender). Except as provided in the
immediately preceding sentence, nothing in this subsection 2.6C shall affect
the obligation of any Lender other than an
46
<PAGE> 55
Affected Lender to make or maintain Loans as, or to convert Loans to,
Eurodollar Rate Loans in accordance with the terms of this Agreement.
(D) COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST
PERIODS. Each Borrower shall compensate each Lender, upon written request by
that Lender (which request shall set forth the basis for requesting such
amounts), for all reasonable losses, expenses and liabilities (including any
interest paid by that Lender to lenders of funds borrowed by it to make or
carry its Eurodollar Rate Loans and any loss, expense or liability sustained
by that Lender in connection with the liquidation or re-employment of such
funds) which that Lender may sustain: (i) if for any reason (other than a
default by that Lender) a borrowing of any Eurodollar Rate Loan does not occur
on a date specified therefor in a Notice of Borrowing or a telephonic request
for borrowing, or a conversion to or continuation of any Eurodollar Rate Loan
does not occur on a date specified therefor in a Notice of
Conversion/Continuation or a telephonic request for conversion or
continuation, (ii) if any prepayment (including any prepayment pursuant to
subsection 2.4B(i)) or other principal payment or any conversion of any of its
Eurodollar Rate Loans occurs on a date prior to the last day of an Interest
Period applicable to that Loan, (iii) if any prepayment of any of its
Eurodollar Rate Loans is not made on any date specified in a notice of
prepayment given by such Borrower, or (iv) as a consequence of any other
default by such Borrower in the repayment of its Eurodollar Rate Loans when
required by the terms of this Agreement.
(E) BOOKING OF EURODOLLAR RATE LOANS. Any Lender may make, carry or
transfer Eurodollar Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of that Lender.
(F) ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR RATE LOANS.
Calculation of all amounts payable to a Lender under this subsection 2.6 and
under subsection 2.7A shall be made as though that Lender had actually funded
each of its relevant Eurodollar Rate Loans through the purchase of a
Eurodollar deposit bearing interest at the rate obtained pursuant to clause
(i) of the definition of Adjusted Eurodollar Rate in an amount equal to the
amount of such Eurodollar Rate Loan and having a maturity comparable to the
relevant Interest Period and through the transfer of such Eurodollar deposit
from an offshore office of that Lender to a domestic office of that Lender in
the United States of America; provided, however, that each Lender may fund
each of its Eurodollar Rate Loans in any manner it sees fit and the foregoing
assumptions shall be utilized only for the purposes of calculating amounts
payable under this subsection 2.6 and under subsection 2.7A.
(G) EURODOLLAR RATE LOANS AFTER DEFAULT. After the occurrence of and
during the continuation of a Potential Event of Default or an Event of Default
and upon notice to such effect to Borrowers from the Administrative Agent or
Requisite Lenders which notice may be delivered after delivery of a Notice of
Borrowing or Notice of Conversion/Continuation but prior to the funding or
continuation or conversion of Loans pursuant thereto, (i) no Borrower may
elect to have a Loan be made or maintained as, or converted to, a Eurodollar
Rate Loan after the expiration of any Interest Period then in effect for that
Loan and (ii) subject to the provisions of subsection 2.6D, any Notice of
Borrowing or Notice of Conversion/Continuation given by a Borrower with
respect to a requested borrowing or conversion/continuation that has not yet
occurred shall be deemed to be rescinded by such Borrower.
47
<PAGE> 56
2.7 INCREASED COSTS; TAXES; CAPITAL ADEQUACY.
(A) COMPENSATION FOR INCREASED COSTS AND TAXES. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and
binding upon all parties hereto) that any law, treaty or governmental rule,
regulation or order, or any change therein or in the interpretation,
administration or application thereof (including the introduction of any new
law, treaty or governmental rule, regulation or order), or any determination
of a court or governmental authority, in each case that becomes effective
after the date hereof, or compliance by such Lender with any guideline,
request or directive issued or made after the date hereof by any central bank
or other governmental or quasi-governmental authority (whether or not having
the force of law):
(i) subjects such Lender (or its applicable lending
office) to any additional Tax (other than any Tax on the overall net
income of such Lender) with respect to this Agreement or any of its
obligations hereunder or any payments to such Lender (or its
applicable lending office) of principal, interest, fees or any other
amount payable hereunder;
(ii) imposes, modifies or holds applicable any reserve
(including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities
in or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such
Lender (other than any such reserve or other requirements with
respect to Eurodollar Rate Loans that are reflected in the definition
of Adjusted Eurodollar Rate); or
(iii) imposes any other condition (other than with
respect to a Tax matter) on or affecting such Lender (or its
applicable lending office) or its obligations hereunder or the
interbank Eurodollar market;
and the result of any of the foregoing is to increase the cost to such Lender
of agreeing to make, making or maintaining Loans hereunder or to reduce any
amount received or receivable by such Lender (or its applicable lending
office) with respect thereto; then, in any such case, the applicable Borrower
shall promptly pay to such Lender, upon receipt of the statement referred to
in the next sentence, such additional amount or amounts (in the form of an
increased rate of, or a different method of calculating, interest or otherwise
as such Lender in its sole discretion shall determine) as may be necessary to
compensate such Lender for any such increased cost or reduction in amounts
received or receivable hereunder. Such Lender shall deliver as soon as
reasonably practicable to each Borrower (with a copy to Administrative Agent)
a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender by such Borrower under
this subsection 2.7A, which statement shall be conclusive and binding upon all
parties hereto absent manifest error.
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(B) WITHHOLDING OF TAXES.
(i) Payments to Be Free and Clear. All sums payable by
each Borrower under this Agreement and the other Loan Documents shall
(except to the extent required by law) be paid free and clear of, and
without any deduction or withholding on account of, any Tax (other
than a Tax on the overall net income of any Lender) imposed, levied,
collected, withheld or assessed by or within the United States of
America or any political subdivision in or of the United States of
America or any other jurisdiction from or to which a payment is made
by or on behalf of Company or by any federation or organization of
which the United States of America or any such jurisdiction is a
member at the time of payment.
(ii) Grossing-up of Payments. If a Borrower or any other
Person is required by law to make any deduction or withholding on
account of any such Tax from any sum paid or payable by such Borrower
to Administrative Agent or any Lender under any of the Loan
Documents:
(a) Such Borrower shall notify Administrative
Agent of any such requirement or any change in any such
requirement as soon as Company becomes aware of it;
(b) Such Borrower shall pay any such Tax
before the date on which penalties attach thereto, such
payment to be made (if the liability to pay is imposed on
such Borrower) for its own account or (if that liability is
imposed on Administrative Agent or such Lender, as the case
may be) on behalf of and in the name of Administrative Agent
or such Lender;
(c) the sum payable by such Borrower in
respect of which the relevant deduction, withholding or
payment is required shall be increased to the extent
necessary to ensure that, after the making of that
deduction, withholding or payment, Administrative Agent or
such Lender, as the case may be, receives on the due date a
net sum equal to what it would have received had no such
deduction, withholding or payment been required or made; and
(d) within 30 days after paying any sum from
which it is required by law to make any deduction or
withholding, and within 30 days after the due date of
payment of any Tax which it is required by clause (b) above
to pay, such Borrower shall deliver to Administrative Agent
evidence satisfactory to the other affected parties of such
deduction, withholding or payment and of the remittance
thereof to the relevant taxing or other authority;
provided that no such additional amount shall be required to be paid
to any Lender under clause (c) above except to the extent that any
change after the date hereof (in the case of each Lender listed on
the signature pages hereof) or after the date of the Assignment
Agreement pursuant to which such Lender became a Lender (in the case
of each other Lender) in any such requirement for a deduction,
withholding or payment as is mentioned therein shall result in an
increase in the rate of such deduction, withholding or payment
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from that in effect at the date of this Agreement or at the date of
such Assignment Agreement, as the case may be, in respect of payments
to such Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is not a U.S. person as
defined in Section 7701(a)(30) of the Code (for purposes of
this subsection 2.7B(iii), a "NON-US LENDER") shall deliver
to Administrative Agent for transmission to Borrowers, on or
prior to the Closing Date (in the case of each Lender listed
on the signature pages hereof) or on or prior to the date of
the Assignment Agreement pursuant to which it becomes a
Lender (in the case of each other Lender), and at such other
times as may be necessary in the determination of Borrowers
or Administrative Agent (each in the reasonable exercise of
its discretion), (1) two original copies of Internal Revenue
Service Form 1001 or 4224 (or any successor forms), properly
completed and duly executed by such Lender, together with
any other certificate or statement of exemption required
under the Internal Revenue Code or the regulations issued
thereunder to establish that such Lender is exempt from
United States federal income tax with respect to any
payments to such Lender of principal, interest, fees or
other amounts payable under any of the Loan Documents or (2)
if such Lender is not a "bank" or other Person described in
Section 881(c)(3) of the Internal Revenue Code and cannot
deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (1) above, a Certificate re Non-Bank
Status together with two original copies of Internal Revenue
Service Form W-8 (or any successor form), properly completed
and duly executed by such Lender, together with any other
certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder
to establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect
to any payments to such Lender of interest payable under any
of the Loan Documents.
(b) Each Lender required to deliver any forms,
certificates or other evidence with respect to United States
federal income tax withholding matters pursuant to
subsection 2.7B(iii)(a) hereby agrees, from time to time
after the initial delivery by such Lender of such forms,
certificates or other evidence, whenever a lapse in time or
change in circumstances renders such forms, certificates or
other evidence obsolete or inaccurate in any material
respect, that such Lender shall promptly (1) deliver to
Administrative Agent for transmission to Borrowers two new
original copies of Internal Revenue Service Form 1001 or
4224, or a Certificate re Non-Bank Status and two original
copies of Internal Revenue Service Form W-8, as the case may
be, properly completed and duly executed by such Lender,
together with any other certificate or statement of
exemption required in order to confirm or establish that
such Lender is not subject to deduction or withholding of
United States federal income tax with respect to payments to
such Lender under the Loan Documents or (2) notify
Administrative Agent and Borrowers of its inability to
deliver any such forms, certificates or other evidence.
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(c) Borrowers shall not be required to pay any
additional amount to any Non-US Lender under clause (c) of
subsection 2.7B(ii) if such Lender shall have failed to
satisfy the requirements of clause (a) or (b)(1) of this
subsection 2.7B(iii); provided that if such Lender shall
have satisfied the requirements of subsection 2.7B(iii)(a)
on the Closing Date (in the case of each Lender listed on
the signature pages hereof) or on the date of the Assignment
Agreement pursuant to which it became a Lender (in the case
of each other Lender), nothing in this subsection
2.7B(iii)(c) shall relieve Borrowers of its obligation to
pay any additional amounts pursuant to clause (c) of
subsection 2.7B(ii) in the event that, as a result of any
change in any applicable law, treaty or governmental rule,
regulation or order, or any change in the interpretation,
administration or application thereof, such Lender is no
longer properly entitled to deliver forms, certificates or
other evidence at a subsequent date establishing the fact
that such Lender is not subject to withholding as described
in subsection 2.7B(iii)(a).
(iv) Payment of Refunds. If the Administrative Agent or
any Lender receives a refund in respect of any Taxes paid by a
Borrower pursuant to Section 2.7(B)(ii)(b), which in the reasonable
judgment of such Lender is allocable to such payment, it shall
promptly pay such refund, together with any other amounts paid by the
relevant Borrower in connection with such Taxes, to such Borrower,
net of all out-of-pocket expenses of such Lender incurred in
obtaining such refund, provided, however, that such Borrower agrees
to promptly return such refund to the Administrative Agent or the
applicable Lender, as the case may be, if it receives notice from the
Administrative Agent or applicable Lender that such Administrative
Agent or Lender is required to repay such refund.
(C) CAPITAL ADEQUACY ADJUSTMENT. If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank, the
National Association of Insurance Commissioners, or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
(or its applicable lending office) with any guideline, request or directive
regarding capital adequacy (whether or not having the force of law) of any
such governmental authority, central bank, the National Association of
Insurance Commissioners or comparable agency, has or would have the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of, or with reference to, such
Lender's Loans or participations therein or other obligations hereunder with
respect to the Loans to a level below that which such Lender or such
controlling corporation could have achieved but for such adoption,
effectiveness, phase-in, applicability, change or compliance (taking into
consideration the policies of such Lender or such controlling corporation with
regard to capital adequacy) by an amount which such Lender deems material,
then from time to time, within five Business Days after receipt by Borrowers
from such Lender of the statement referred to in the next sentence, the
applicable Borrower shall pay to such Lender such additional amount or amounts
as will compensate such Lender or such controlling corporation on an after-tax
basis for such reduction. Such Lender shall deliver to Borrowers (with a copy
to Administrative Agent) a written statement, setting forth in reasonable
detail the basis of the calculation of such additional amounts, which
statement shall be conclusive and binding upon all
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parties hereto absent manifest error; provided that Borrowers shall not be
required to compensate a Lender pursuant to this subsection 2.7C for any
amounts incurred more than six months prior to the date that such Lender
notifies Borrowers of such Lender's intention to claim compensation therefor,
except that, if the circumstances giving rise to such claim have a retroactive
effect, then such six-month period shall be extended to include the period of
such retroactive effect.
(D) SUBSTITUTE LENDERS. In the event Company is required under the
provisions of this subsection 2.7 to make payments in a material amount to any
Lender or in the event any Lender fails to lend to Borrowers in accordance
with this Agreement, Borrowers may, so long as no Event of Default or
Potential Event of Default shall have occurred and be continuing, elect to
terminate such Lender as a party to this Agreement; provided that,
concurrently with such termination, (i) each Borrower shall pay that Lender
all principal, interest and fees and other amounts (including without
limitation, amounts, if any, owed under this subsection 2.7) owed to such
Lender through such date of termination, (ii) another financial institution
satisfactory to Administrative Agent (or if Administrative Agent is also the
Lender to be terminated, the successor Administrative Agent) shall agree, as
of such date, to become a Lender for all purposes under this Agreement
(whether by assignment or amendment) and to assume all obligations of the
Lender to be terminated as of such date, and (iii) all documents and
supporting materials necessary, in the judgment of Administrative Agent (or if
Administrative Agent is also the Lender to be terminated, the successor
Administrative Agent), to evidence the substitution of such Lender shall have
been received and approved by Administrative Agent as of such date.
2.8 OBLIGATION OF LENDERS TO MITIGATE.
Each Lender agrees that, as promptly as practicable after the officer
of such Lender responsible for administering the Loans of such Lender becomes
aware of the occurrence of an event or the existence of a condition that would
cause such Lender to become an Affected Lender or that would entitle such
Lender to receive payments under subsection 2.7, it will, to the extent not
inconsistent with the internal policies of such Lender and any applicable
legal or regulatory restrictions, use reasonable efforts (i) to maintain the
affected Loans of such Lender through another lending office of such Lender,
or (ii) take such other measures as such Lender may deem reasonable, if as a
result thereof the circumstances which would cause such Lender to be an
Affected Lender would cease to exist or the additional amounts which would
otherwise be required to be paid to such Lender pursuant to subsection 2.7
would be materially reduced and if, as determined by such Lender in its sole
discretion, the maintaining of such Loans through such other lending office or
in accordance with such other measures, as the case may be, would not
otherwise materially adversely affect such Loans or the interests of such
Lender; provided that such Lender will not be obligated to utilize such other
lending office pursuant to this subsection 2.8 unless Company agrees to pay
all incremental expenses incurred by such Lender as a result of utilizing such
other lending office as described in clause (i) above. A certificate as to the
amount of any such expenses payable by Company pursuant to this subsection 2.8
(setting forth in reasonable detail the basis for requesting such amount)
submitted by such Lender to Company (with a copy to Administrative Agent)
shall be conclusive absent manifest error.
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SECTION 3.
CONDITIONS TO EFFECTIVENESS
3.1 CONDITIONS TO EFFECTIVENESS.
This Agreement shall become effective only upon satisfaction or
written waiver by Requisite Lenders of the following conditions:
(A) LOAN PARTY DOCUMENTS. On or before the Restatement Effective
Date, Borrowers shall, and shall cause each other Loan Party requested by
Requisite Lenders to, deliver to Lenders (or to Administrative Agent for
Lenders with sufficient originally executed copies, where appropriate, for
each Lender and its counsel) the following with respect to each Borrower or
such Loan Party, as the case may be, each, unless otherwise noted, dated the
Restatement Effective Date:
(i) Executed originals of the Loan Documents to which
such Person is a party; and
(ii) Such other documents as Arranger or Administrative
Agent may reasonably request.
(B) NO MATERIAL ADVERSE EFFECT. Since June 30, 2000, no Material
Adverse Effect (in the opinion of Arranger and Administrative Agent) shall
have occurred.
(C) [INTENTIONALLY OMITTED]
(D) SECURITY INTERESTS IN PERSONAL AND MIXED PROPERTY. Each of
Arranger and Administrative Agent shall be satisfied that Borrowers and
Subsidiary Guarantors shall have taken or caused to be taken all such actions,
executed and delivered or caused to be executed and delivered all such
agreements, documents and instruments, and made or caused to be made all such
filings and recordings that may be necessary or, in the opinion of Arranger
and Administrative Agent, desirable in order to create in favor of
Administrative Agent, for the benefit of Lenders, a valid and perfected First
Priority security interest in the entire personal and mixed property
Collateral.
(E) [INTENTIONALLY OMITTED]
(F) OPINIONS OF COUNSEL TO LOAN PARTIES. Lenders shall have received
originally executed copies of a written opinion of Davis Polk & Wardwell,
counsel for Loan Parties, and Juliette Williams Pryor, Senior Vice President
and General Counsel of Company, in form and substance reasonably satisfactory
to Administrative Agent and Arranger and its counsel, dated as of the
Restatement Effective Date and setting forth substantially the matters in the
opinions designated in Exhibit IX-A and Exhibit IX-B annexed hereto and as to
such other matters as Administrative Agent or Arranger acting on behalf of
Lenders may reasonably request and (ii) evidence satisfactory to Arranger and
Administrative Agent that Company has requested such counsel to deliver such
opinions to Lenders.
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(G) REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF AGREEMENTS.
Borrowers shall have delivered to Arranger and Administrative Agent an
Officers' Certificate of Borrowers, in form and substance satisfactory to
Arranger and Administrative Agent, to the effect that, after giving effect to
this Agreement, the representations and warranties in Section 4 hereof are
true, correct and complete in all material respects on and as of the
Restatement Effective Date to the same extent as though made on and as of that
date (or, to the extent such representations and warranties specifically
relate to an earlier date, that such representations and warranties were true,
correct and complete in all material respects on and as of such earlier date)
and that Borrowers shall have performed in all material respects all
agreements and satisfied all conditions which this Agreement provides shall be
performed or satisfied by it on or before the Restatement Effective Date
except as otherwise disclosed to and agreed to in writing by Arranger,
Administrative Agent and Requisite Lenders.
(H) LIQUIDITY PROJECTIONS. Agents and Lenders shall have received, in
form and substance satisfactory to the Arranger and the Administrative Agent,
projections prepared by Borrowers demonstrating adequate liquidity through
December 31, 2001.
(I) ADDITIONAL JUNIOR CAPITAL AGREEMENTS. Each of the following
shall have occurred:
(i) Company and the Investors or other investors shall
have entered into the Huff Purchase Agreement dated as of the date
hereof relating to the purchase of $124,300,000 of the Committed
Preferred, such agreement to be in form and substance satisfactory to
Requisite Lenders.
(ii) The Huff Fund and Company shall have entered into a
valid and enforceable voting agreement (the "VOTING AGREEMENT")
pursuant to which the Huff Fund agrees to vote all shares of Capital
Stock of the Company owned by it (representing a minimum of
14,000,000 shares of voting securities of Company) in favor of the
issuance of the Committed Preferred, such agreement to be in form and
substance satisfactory to Requisite Lenders.
(iii) The Huff Fund shall have entered into the Loan Put
Agreement with the Lenders.
(J) VOLUNTARY PREPAYMENT. Company shall have made a voluntary
prepayment of the Loans in the principal amount of $25,000,000 as follows: (a)
$15,000,000 paid on July 14, 2000 and (b) the remaining $10,000,000 paid on or
before the Restatement Effective Date.
(K) UPDATED BORROWERS' QUESTIONNAIRE. Arranger and
Administrative Agent shall have received an updated Borrowers' Questionnaire
duly completed and in form and substance satisfactory to the Arranger and
Administrative Agent.
(L) OFFICERS' CERTIFICATE REGARDING USE OF PROCEEDS. Lenders
shall have received an Officers' Certificate in form and substance
satisfactory to the Arranger and the Administrative Agent setting forth in
reasonable detail (i) the dates and amounts of each Series B Term Loan and
Series C Term Loan made under this Agreement and the respective
Telecommunications Assets purchased with the proceeds of such Series B Term
Loans and Series C Term Loans, (ii) the amounts due and owing by each
Subsidiary of Finance Sub to Finance Sub under the
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Intercompany Purchase Money Note and (iii) all purchase money Indebtedness,
demonstrating compliance with subsections 2.1(A)(iv) and 6.1(vi) of this
Agreement.
(M) PROFESSIONAL ADVISOR MATERIALS. Lenders shall have received
copies of any engagement letters or other agreements pursuant to which the
Company has engaged any professional advisor to advise them with respect to
potential asset sales or other strategic alternatives and copies of any draft
or final offering memorandum or similar documents prepared in connection with
any proposed asset sales or other strategic alternatives as of the Restatement
Effective Date.
(N) PAYMENTS OF AMOUNTS DUE. All costs, fees, expenses
(including, without limitation, legal fees and expenses and the fee payable
under subsection 2.3C (other than the Deferred Restructuring Fee) and other
compensation contemplated hereby payable to Arranger, Administrative Agent or
the Lenders shall have been paid to the extent due as of the Restatement
Effective Date.
(O) REALLOCATION OF LOANS. On the Restatement Effective Date,
Finance Sub shall have borrowed the remaining $5,000,000 available under the
Series A Loan Commitments under the Original Credit Agreement from Lenders and
made a voluntary repayment of $5,000,000 on the Series B Term Loans.
(P) CASH MANAGEMENT SYSTEMS. Arranger and Administrative Agent
shall have received at least five Business Days prior to the Restatement
Effective Date, in form and substance reasonably satisfactory to Arranger and
Administrative Agent, Schedule 4.18 describing the cash management system of
the Loan Parties and Arranger and Administrative Agent shall be satisfied that
Company and its Restricted Subsidiaries are in compliance with the covenants
set forth in subsection 5.11.
3.2 LENDER ACKNOWLEDGMENT AND CONSENT.
Each Lender by delivering its signature page to this Agreement on the
Restatement Effective Date shall be deemed to have acknowledged receipt of,
and consented to and approved (as long as substantially in the form delivered
to Lenders, including any changed pages thereto delivered to Lenders), each
Loan Document and each other document required to be approved by Requisite
Lenders or Lenders, as applicable.
SECTION 4.
BORROWERS' REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to
continue the Loans and to induce other Lenders to purchase participations
therein, each Borrower represents and warrants to each Lender, on the date of
this Agreement, that the following statements are true, correct and complete:
4.1 ORGANIZATION, POWERS, QUALIFICATION, GOOD STANDING, BUSINESS AND
SUBSIDIARIES.
(A) ORGANIZATION AND POWERS. Each Loan Party is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization as specified in Schedule 4.1
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annexed hereto. Each Loan Party has all requisite power and authority to own
and operate its properties, to carry on its business as now conducted and as
proposed to be conducted, to enter into the Loan Documents to which it is a
party and to carry out the transactions contemplated thereby.
(B) QUALIFICATION AND GOOD STANDING. Each Loan Party is qualified to
do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations,
except in jurisdictions where the failure to be so qualified or in good
standing has not had and could not reasonably be expected to have a Material
Adverse Effect.
(C) CONDUCT OF BUSINESS. Loan Parties are engaged only in the
businesses permitted to be engaged in pursuant to subsection 6.14.
(D) SUBSIDIARIES. All of the Subsidiaries of Company are identified
in Schedule 4.1 annexed hereto, as said Schedule 4.1 may be supplemented from
time to time pursuant to the provisions of subsection 5.1(xvi). The Capital
Stock of each of the Subsidiaries of Company identified in Schedule 4.1
annexed hereto (as so supplemented) is duly authorized, validly issued, fully
paid and nonassessable and none of such Capital Stock constitutes Margin
Stock. Each of the Subsidiaries of Company identified in Schedule 4.1 annexed
hereto (as so supplemented) is duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of organization set
forth therein, has all requisite power and authority to own and operate its
properties and to carry on its business as now conducted and as proposed to be
conducted, and is qualified to do business and in good standing in every
jurisdiction where its assets are located and wherever necessary to carry out
its business and operations, in each case except where failure to be so
qualified or in good standing or a lack of such corporate power and authority
has not had and could not reasonably be expected to have a Material Adverse
Effect. Schedule 4.1 annexed hereto (as so supplemented) correctly sets forth
the ownership interest of Company and each of its Subsidiaries in each of the
Subsidiaries of Company identified therein.
(E) REGULATORY AUTHORIZATIONS.
(i) Licenses. Except as set forth in Part I of
Schedule 4.1E annexed hereto as such Schedule 4.1E may be
supplemented from time to time pursuant to the provisions of
subsection 5.1(xvii), each of the Loan Parties has obtained all
licenses, permits, certifications or other authorizations required by
the Communications Regulatory Authorities under the Communications
Act, State Law and local law in order to carry out its business and
operations as presently conducted and as proposed to be conducted,
including the provision of the telecommunications services set forth
in any Licenses except to the extent the failure to obtain such
licenses, permits, certifications or other authorizations would not
individually or in the aggregate have a Material Adverse Effect. Part
II of Schedule 4.1E (as so supplemented) annexed hereto accurately
lists all Licenses, including their expiration dates, held by each of
the Loan Parties as of the date of this Agreement. Each such License
was duly and validly issued by the FCC, the appropriate State PUC or
local governmental authority pursuant to procedures which materially
comply with all requirements of all applicable federal, state or
local laws and is in full force and effect except to the extent the
failure to be in full force and effect
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could not reasonably be expected individually or in the aggregate to
have a Material Adverse Effect. None of the Loan Parties has any
knowledge of the occurrence of any event or the existence of any
circumstance which, in the reasonable judgment of such Loan Party, is
likely to lead to the revocation, suspension, non-renewal or adverse
modification of any material Licenses.
(ii) Compliance with Applicable Laws. The Loan Parties
are in compliance with the terms of all applicable Regulations except
to the extent noncompliance could not reasonably be expected
individually or in the aggregate to have a Material Adverse Effect.
Each of the Loan Parties has duly filed in a timely manner all
filings, including tariff filings, required by the FCC, any State PUC
or any local governmental authority to be filed by such Loan Party as
a precondition to the provision of the telecommunications services
which it offers except to the extent failure to do so could not
reasonably be expected individually or in the aggregate to have a
Material Adverse Effect. None of the Loan Parties is a party as a
defendant to, or is aware of any overt threat of, any litigation,
proceeding, action, notice of violation or apparent liability, order
to show cause, order of forfeiture, formal or informal complaint,
inquiry or investigation by or before the FCC, any State PUC or any
local governmental authority with jurisdiction over the services
which it offers as to which there is a reasonable possibility of an
adverse determination and, which if adversely determined, could
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
4.2 AUTHORIZATION, ETC.
(A) AUTHORIZATION. The execution, delivery and performance of the
Loan Documents have been duly authorized by all necessary action on the part
of each Loan Party that is a party thereto.
(B) NO CONFLICT. The execution, delivery and performance by Loan
Parties of the Loan Documents to which they are parties and the consummation
of the transactions contemplated by the Loan Documents do not and will not (i)
violate any provision of any law or any governmental rule or regulation
applicable to any Loan Party or any of its Subsidiaries, the Organizational
Documents of any Loan Party or any of its Subsidiaries or any order, judgment
or decree of any court or other agency of government binding on any Loan Party
or any of its Subsidiaries, (ii) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of any Loan Party or any of its Subsidiaries, (iii)
result in or require the creation or imposition of any Lien upon any of the
properties or assets of any Loan Party or any of its Subsidiaries (other than
any Liens created under any of the Loan Documents in favor of Administrative
Agent on behalf of Lenders), or (iv) require any approval of stockholders or
any approval or consent of any Person under any Contractual Obligation of any
Loan Party or any of its Subsidiaries, except for such approvals or consents
which will be obtained on or before the Closing Date and disclosed in writing
to Lenders (other than, in the case of the issuance and sale of the Committed
Preferred, the Stockholder Approval and any required approval of NASDAQ and,
in the case of the issuance and sale of certain other Required Junior Capital
or Subsequent Junior Capital, approval by the stockholders of Company and any
required approval of any securities regulatory authorities or securities
exchange).
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(C) GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Loan Parties of the Loan Documents to which they are parties and the
consummation of the transactions contemplated by the Loan Documents do not and
will not require any registration with, consent or approval of, or notice to,
or other action to, with or by, any federal, state or other governmental
authority or regulatory body except (i) consents, authorizations, filings and
notices described in Schedule 4.2C annexed hereto, which consents,
authorizations, filings and notices have been obtained or made and are in full
force and effect and (ii) in the case of the issuance and sale of certain
Required Junior Capital or Subsequent Junior Capital, registration with,
consent or approval of, notice to, or other action to, with or by applicable
securities regulatory authorities and securities exchange.
(D) BINDING OBLIGATION. Each of the Loan Documents has been duly
executed and delivered by each Loan Party that is a party thereto and is the
legally valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles
relating to enforceability.
4.3 FINANCIAL CONDITION.
Company has heretofore delivered to Lenders, at Lenders' request, the
following financial statements and information: (i) the audited consolidated
balance sheets of Company and its Subsidiaries as at December 31, 1999 and the
related consolidated statements of income, stockholders' equity and cash flows
of Company and its Subsidiaries for the Fiscal Year then ended and (ii) the
unaudited consolidated balance sheet of Company and its Subsidiaries as at
June 30, 2000 and the related unaudited consolidated statements of income,
stockholders' equity and cash flows of Company and its Subsidiaries for the
six months then ended. All such statements were prepared in conformity with
GAAP and fairly present, in all material respects, the financial position (on
a consolidated basis of the entities described in such financial statements as
at the respective dates thereof and the results of operations and cash flows
(on a consolidated basis) of the entities described therein for each of the
periods then ended, subject, in the case of any such unaudited financial
statements, to changes resulting from audit and normal year-end adjustments.
Neither Company nor its Subsidiaries has (and except as expressly permitted by
this Agreement, will not following the funding of the initial Loans have) any
Contingent Obligation, contingent liability or liability for taxes, long-term
lease or unusual forward or long-term commitment that is not reflected in the
foregoing financial statements or the notes thereto and which in any such case
is material in relation to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Company or any of its
Subsidiaries.
4.4 NO MATERIAL ADVERSE CHANGE; NO RESTRICTED JUNIOR PAYMENTS.
Since June 30, 2000, no event or change has occurred that has caused
or evidences, either in any case or in the aggregate, a Material Adverse
Effect. Neither Company nor any of its Subsidiaries has directly or indirectly
declared, ordered, paid or made, or set apart any sum or property for, any
Restricted Junior Payment or agreed to do so except as permitted by subsection
6.5.
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4.5 TITLE TO PROPERTIES; LIENS; REAL PROPERTY.
(A) TITLE TO PROPERTIES; LIENS. Each of the Loan Parties has (i)
good, sufficient and legal title to (in the case of fee interests in real
property), (ii) valid leasehold interests in (in the case of leasehold
interests in real or personal property), or (iii) good title to (in the case
of all other personal property), all of their respective properties and assets
reflected in the financial statements referred to in subsection 4.3 or in the
most recent financial statements delivered pursuant to subsection 5.1, in each
case except for assets disposed of since the date of such financial statements
in the ordinary course of business or as otherwise permitted under subsection
6.8. Except as permitted by this Agreement, all such properties and assets are
free and clear of Liens.
(B) REAL PROPERTY. Each material lease, sublease or assignment of
lease (together with all amendments, modifications, supplements, renewals or
extensions of any thereof) affecting each interest of any Loan Party in any
real property, regardless of whether such Loan Party is the Landlord or tenant
(whether directly or as an assignee or successor in interest) under such
lease, sublease or assignment is in full force and effect and no Borrower has
knowledge of any material default that has occurred and is continuing
thereunder, and each such agreement constitutes the legally valid and binding
obligation of each applicable Loan Party, enforceable against such Loan Party
in accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles.
4.6 LITIGATION; ADVERSE FACTS.
There are no actions, suits, proceedings, arbitrations or
governmental investigations (whether or not purportedly on behalf of any Loan
Party or any of its Subsidiaries) at law or in equity, or before or by any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign (including any
Environmental Claims) that are pending or, to the knowledge of either
Borrower, threatened against any Loan Party or any of its Subsidiaries or any
property of any Loan Party or any of its Subsidiaries and that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect. No Loan Party nor any of its Subsidiaries (i) is in violation
of any applicable laws (including Environmental Laws) that, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse
Effect, or (ii) is subject to or in default with respect to any final
judgments, writs, injunctions, decrees, rules or regulations of any court or
any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.
4.7 PAYMENT OF TAXES.
Except to the extent permitted by subsection 5.3, all material tax
returns and reports of Company and its Subsidiaries required to be filed by
any of them have been timely filed, and all material taxes shown on such tax
returns to be due and payable and all material assessments, fees and other
governmental charges upon Company and its Subsidiaries and upon their
respective properties, assets, income, businesses and franchises which are due
and payable have been paid
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when due and payable. Neither Borrower knows of any material proposed tax
assessment against any Loan Party or any of its Subsidiaries which is not
being actively contested by such Loan Party or such Subsidiary in good faith
and by appropriate proceedings; provided that such reserves or other
appropriate provisions, if any, as shall be required in conformity with GAAP
shall have been made or provided therefor.
4.8 PERFORMANCE OF AGREEMENTS; MATERIALLY ADVERSE AGREEMENTS; MATERIAL
CONTRACTS.
(A) No Loan Party nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect,
of such default or defaults, if any, could not reasonably be expected to have
a Material Adverse Effect.
(B) No Loan Party nor any of its Subsidiaries is a party to or is
otherwise subject to any agreements or instruments or any charter or other
internal restrictions which, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.
4.9 GOVERNMENTAL REGULATION.
No Loan Party nor any of its Subsidiaries is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act,
the Interstate Commerce Act or the Investment Company Act of 1940 or under any
other federal or state statute or regulation (other than Regulation X of the
Board of Governors of the Federal Reserve System) which may limit its ability
to incur Indebtedness or which may otherwise render all or any portion of the
Obligations unenforceable.
4.10 SECURITIES ACTIVITIES.
No Loan Party nor any of its Subsidiaries (i) is engaged principally,
or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying any Margin Stock or (ii) will use the
proceeds of any Loans to purchase Margin Stock or in any manner whatsoever to
cause a violation of Regulation U of the Board of Governors of the Federal
Reserve System.
4.11 EMPLOYEE BENEFIT PLANS.
(A) Each Loan Party and each of their respective ERISA Affiliates are
in material compliance with all applicable provisions and requirements of
ERISA and the regulations and published interpretations thereunder with
respect to each Employee Benefit Plan, and have performed all their
obligations under each Employee Benefit Plan, except where the failure to
comply or perform could not reasonably be expected to result in a Material
Adverse Effect. Each Employee Benefit Plan which is intended to qualify under
Section 401(a) of the Internal Revenue Code has received a favorable
determination letter from the IRS and nothing, to the best knowledge of the
Loan Parties, has occurred with respect to the operation of an Employee
Benefit Plan since the date of such letter which would reasonably be expected
to cause it to be no longer valid or effective.
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(B) No ERISA Event has occurred or is reasonably expected to occur
that could reasonably be expected to have a Material Adverse Effect.
(C) As of the most recent valuation date for any Pension Plan, the
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities), does not exceed an amount, which if immediately
due and payable, could reasonably be expected to have a Material Adverse
Effect.
(D) As of the most recent valuation date for each Multiemployer Plan
for which the actuarial report has been provided to Borrowers, the potential
liability of Loan Parties and their respective ERISA Affiliates for a complete
withdrawal from such Multiemployer Plan (within the meaning of Section 4203 of
ERISA), when aggregated with such potential liability for a complete
withdrawal from all Multiemployer Plans, could not reasonably be expected to
have a Material Adverse Effect.
4.12 CERTAIN FEES.
No broker's or finder's fee or commission will be payable with
respect to this Agreement or any of the transactions contemplated hereby, and
Borrowers hereby indemnify Lenders against, and agree that each of them will
hold Lenders harmless from, any claim, demand or liability for any such
broker's or finder's fees alleged to have been incurred in connection herewith
or therewith and any expenses (including reasonable fees, expenses and
disbursements of counsel) arising in connection with any such claim, demand or
liability.
4.13 ENVIRONMENTAL PROTECTION.
(i) No Loan Party nor any of its Subsidiaries nor any
of their respective Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement
with any Person relating to (a) any Environmental Law, (b) any
Environmental Claim, or (c) any Hazardous Materials Activity that,
individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect;
(ii) No Loan Party nor any of its Subsidiaries has
received any letter or request for information under Section 104 of
the Comprehensive Environmental Response, Compensation, and Liability
Act (42 U.S.C. Section 9604) or any comparable state law;
(iii) There are and, to Borrowers' knowledge, have been
no conditions, occurrences, or Hazardous Materials Activities which
could reasonably be expected to form the basis of an Environmental
Claim against any Loan Party or any of its Subsidiaries that,
individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect;
(iv) Except as could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect,
no Loan Party nor any of its Subsidiaries nor, to Borrower's
knowledge, any predecessor of Company or any of its Subsidiaries has
filed any notice under any Environmental Law indicating past or
present treatment of
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Hazardous Materials at any Facility, and no Loan Party or any of its
Subsidiaries' operations involves the generation, transportation,
treatment, storage or disposal of hazardous waste, as defined under
40 C.F.R. Parts 260-270 or any state equivalent;
(v) Compliance with all current or, to the best
knowledge of each Loan Party, reasonably foreseeable future
requirements pursuant to or under Environmental Laws could not,
individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect.
Notwithstanding anything in this subsection 4.13 to the contrary, no
event or condition has occurred or is occurring with respect to any Loan Party
or any of its Subsidiaries relating to any Environmental Law, any Release of
Hazardous Materials, or any Hazardous Materials Activity which individually or
in the aggregate has had or could reasonably be expected to have a Material
Adverse Effect.
4.14 EMPLOYEE MATTERS.
Except as set forth in Schedule 4.14 annexed hereto, no Loan Party or
any of its Subsidiaries is as of the date hereof, a party to any collective
bargaining agreement and, to the knowledge of any Loan Party, no union
representation question exists as of the date hereof with respect to the
employees of any Loan Party or any of its Subsidiaries. There is no strike,
work stoppage, slowdown, lockout or any other labor dispute pending, or to the
knowledge of Borrowers threatened, involving any Loan Party or any of its
Subsidiaries that individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect.
4.15 SOLVENCY.
Each Loan Party is and, upon the incurrence of any Obligations by
such Loan Party on any date on which this representation is made, will be,
Solvent.
4.16 MATTERS RELATING TO COLLATERAL.
(A) CREATION, PERFECTION AND PRIORITY OF LIENS. The execution and
delivery of the Collateral Documents by Loan Parties, together with (i) the
actions taken on or prior to the date hereof pursuant to the Original Credit
Agreement and thereafter pursuant to subsection 5.8 and (ii) the delivery to
Administrative Agent of any Pledged Collateral not delivered to Administrative
Agent at the time of execution and delivery of the applicable Collateral
Document (all of which Pledged Collateral has been so delivered) are effective
to create in favor of Administrative Agent for the benefit of Lenders, as
security for the respective Secured Obligations (as defined in the applicable
Collateral Document in respect of any Collateral), a valid and perfected First
Priority Lien on all of the Collateral, and all filings and other actions
necessary or desirable to perfect and maintain the perfection and First
Priority status of such Liens have been duly made or taken and remain in full
force and effect, other than the periodic filing of UCC continuation
statements in respect of UCC financing statements filed by or on behalf of
Administrative Agent.
(B) GOVERNMENTAL AUTHORIZATIONS. No authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either
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(i) the pledge or grant by any Loan Party of the Liens purported to be created
in favor of Administrative Agent pursuant to any of the Collateral Documents
or (ii) the exercise by Administrative Agent of any rights or remedies in
respect of any Collateral (whether specifically granted or created pursuant to
any of the Collateral Documents or created or provided for by applicable law),
except for filings or recordings contemplated by subsection 4.16A and except
as may be required, in connection with the disposition of any Pledged
Collateral, by laws generally affecting the offering and sale of securities.
(C) ABSENCE OF THIRD-PARTY FILINGS. Except such as may have been
filed in favor of Administrative Agent as contemplated by subsection 4.16A and
in respect of Liens permitted under subsection 6.2A, no effective UCC
financing statement, fixture filing or other instrument similar in effect
covering all or any part of the Collateral is on file in any filing or
recording office.
(D) MARGIN REGULATIONS. The pledge of the Pledged Collateral pursuant
to the Collateral Documents does not violate Regulation T, U or X of the Board
of Governors of the Federal Reserve System.
(E) INFORMATION REGARDING COLLATERAL. All information supplied to
Administrative Agent by or on behalf of any Loan Party with respect to any of
the Collateral (in each case taken as a whole with respect to any particular
Collateral) is accurate and complete in all material respects.
4.17 DISCLOSURE.
As of the date hereof or if later the Restatement Effective Date, no
representation or warranty of any Loan Party or any of its Subsidiaries
contained in any Loan Document or in any other document, certificate or
written statement furnished to Lenders by or on behalf of any Loan Party or
any of its Subsidiaries for use in connection with the transactions
contemplated by this Agreement contained any untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements contained herein or therein not misleading in light of the
circumstances in which the same were made. Any projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by management of Borrowers to be reasonable
at the time made, it being recognized by Lenders that such projections as to
future events are not to be viewed as facts and that actual results during the
period or periods covered by any such projections may differ from the
projected results. There are no facts known (or which should upon the
reasonable exercise of diligence be known) as of the date hereof or if later
the Restatement Effective Date, to either Borrower (other than matters of a
general economic nature) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect and that have
not been disclosed herein or in such other documents, certificates and
statements furnished to Lenders for use in connection with the transactions
contemplated hereby.
4.18 REPRESENTATIONS CONCERNING CASH MANAGEMENT SYSTEM.
The description of the Loan Parties' cash management system set forth
in Schedule 4.18 annexed hereto is accurate and complete in all respects as of
the Restatement Effective Date. No
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Loan Party owns or maintains any Deposit Account which is not described in
Schedule 4.18 or otherwise permitted pursuant to subsection 5.11.
SECTION 5.
BORROWERS' AFFIRMATIVE COVENANTS
Each Borrower covenants and agrees that until payment in full of all
of the Loans and other Obligations unless Requisite Lenders shall otherwise
give prior written consent, such Borrower shall perform, and shall cause each
of its Subsidiaries to perform, all covenants in this Section 5.
5.1 FINANCIAL STATEMENTS AND OTHER REPORTS.
Each Borrower will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance
with sound business practices to permit preparation of financial statements in
conformity with GAAP. Company will deliver to Administrative Agent and
Lenders:
(i) Monthly Financials: as soon as available and in
any event within 30 days after the end of each month other than the
last month of each Fiscal Quarter, the consolidated balance sheet of
Company and its Subsidiaries as at the end of such month and the
related consolidated statements of income and cash flows of Company
and its Subsidiaries for such month and for the period from the
beginning of the then current Fiscal Year to the end of such month,
setting forth in each case in comparative form the corresponding
figures for the corresponding periods of the previous Fiscal Year and
the corresponding figures from the Financial Plan for the current
Fiscal Year, to the extent prepared on a monthly basis, all in
reasonable detail and certified by the chief financial officer of
Company that they fairly present, in all material respects, the
financial condition of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows
for the periods indicated, subject to changes resulting from audit
and normal year-end adjustments;
(ii) Quarterly Financials: as soon as available and in
any event within 45 days after the end of each Fiscal Quarter, (a)
the consolidated balance sheet of Company and its Subsidiaries as at
the end of such Fiscal Quarter and the related consolidated
statements of income, stockholders' equity and cash flows of Company
and its Subsidiaries for such Fiscal Quarter and for the period from
the beginning of the then current Fiscal Year to the end of such
Fiscal Quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous
Fiscal Year and the corresponding figures from the Financial Plan for
the current Fiscal Year, all in reasonable detail and certified by
the chief financial officer of Company that they fairly present, in
all material respects, the financial condition of Company and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, subject to
changes resulting from audit and normal year-end adjustments, and (b)
a narrative report describing the operations of Company and its
Subsidiaries in the form prepared for presentation to senior
management for such Fiscal
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Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter;
(iii) Year-End Financials: as soon as available and in
any event within 90 days after the end of each Fiscal Year, (a) the
consolidated balance sheet of Company and its Subsidiaries as at the
end of such Fiscal Year and the related consolidated statements of
income, stockholders' equity and cash flows of Company and its
Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the corresponding figures for the previous Fiscal
Year and the corresponding figures from the Financial Plan for the
Fiscal Year covered by such financial statements, all in reasonable
detail and certified by the chief financial officer of Company that
they fairly present, in all material respects, the financial
condition of Company and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the
periods indicated, (b) a narrative report describing the operations
of Company and its Subsidiaries in the form prepared for presentation
to senior management for such Fiscal Year, and (c) in the case of
such consolidated financial statements, a report thereon of KPMG Peat
Marwick LLP or other independent certified public accountants of
recognized national standing selected by Company and satisfactory to
Administrative Agent, which report shall be unqualified, shall
express no doubts about the ability of Company and its Subsidiaries
to continue as a going concern, and shall state that such
consolidated financial statements fairly present, in all material
respects, the consolidated financial position of Company and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated in
conformity with GAAP applied on a basis consistent with prior years
(except as otherwise disclosed in such financial statements) and that
the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with
generally accepted auditing standards;
(iv) Officers' and Compliance Certificates: together
with each delivery of financial statements of Company and its
Subsidiaries pursuant to subdivisions (ii) and (iii) above, (a) an
Officers' Certificate of Company stating that the signers have
reviewed the terms of this Agreement and have made, or caused to be
made under their supervision, a review in reasonable detail of the
transactions and condition of Company and its Subsidiaries during the
accounting period covered by such financial statements and that such
review has not disclosed the existence during or at the end of such
accounting period, and that the signers do not have knowledge of the
existence as at the date of such Officers' Certificate, of any
condition or event that constitutes an Event of Default or Potential
Event of Default, or, if any such condition or event existed or
exists, specifying the nature and period of existence thereof and
what action Company has taken, is taking and proposes to take with
respect thereto; and (b) a Compliance Certificate demonstrating in
reasonable detail compliance during and at the end of the applicable
accounting periods with the restrictions contained in Section 6, in
each case to the extent compliance with such restrictions is required
to be tested at the end of the applicable accounting period;
(v) Reconciliation Statements: if, as a result of any
change in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 4.3, the consolidated financial statements of
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Company and its Subsidiaries delivered pursuant to subdivisions (i),
(ii), (iii) or (xiii) of this subsection 5.1 will differ in any
material respect from the consolidated financial statements that
would have been delivered pursuant to such subdivisions had no such
change in accounting principles and policies been made, then (a)
together with the first delivery of financial statements pursuant to
subdivision (i), (ii), (iii) or (xiii) of this subsection 5.1
following such change, consolidated financial statements of Company
and its Subsidiaries for (1) the current Fiscal Year to the effective
date of such change and (2) the two full Fiscal Years immediately
preceding the Fiscal Year in which such change is made, in each case
prepared on a pro forma basis as if such change had been in effect
during such periods, and (b) together with each delivery of financial
statements pursuant to subdivision (i), (ii), (iii) or (xiii) of this
subsection 5.1 following such change, a written statement of the
chief accounting officer or chief financial officer of Company
setting forth the differences (including any differences that would
affect any calculations relating to the financial covenants set forth
in subsection 6.6) which would have resulted if such financial
statements had been prepared without giving effect to such change;
(vi) Accountants' Certification: together with each
delivery of consolidated financial statements of Company and its
Subsidiaries pursuant to subdivision (iii) above, a written statement
by the independent certified public accountants giving the report
thereon (a) stating that their audit examination has included a
review of the terms of this Agreement and the other Loan Documents as
they relate to accounting matters, (b) stating whether, in connection
with their audit examination, any condition or event that constitutes
an Event of Default or Potential Event of Default has come to their
attention and, if such a condition or event has come to their
attention, specifying the nature and period of existence thereof;
provided that such accountants shall not be liable by reason of any
failure to obtain knowledge of any such Event of Default or Potential
Event of Default that would not be disclosed in the course of their
audit examination, and (c) stating that based on their audit
examination nothing has come to their attention that causes them to
believe either or both that the information contained in the
certificates delivered therewith pursuant to subdivision (iv) above
is not correct or that the matters set forth in the Compliance
Certificates delivered therewith pursuant to clause (b) of
subdivision (iv) above for the applicable Fiscal Year are not stated
in accordance with the terms of this Agreement;
(vii) Accountants' Reports: promptly upon receipt thereof
(unless restricted by applicable professional standards), copies of
all reports submitted to Company by independent certified public
accountants in connection with each annual, interim or special audit
of the financial statements of Company and its Subsidiaries made by
such accountants, including any comment letter (including any draft
letter containing comments which remain unresolved 30 days after the
submission thereof) submitted by such accountants to management in
connection with their annual audit;
(viii) SEC Filings and Press Releases: promptly upon
their becoming available, copies of (a) all financial statements,
reports, notices and proxy statements sent or made available
generally by Company to its security holders or by any Subsidiary of
Company to its security holders other than Company or another
Subsidiary of Company, (b) all regular and periodic reports and all
registration statements (other than on Form S-8 or a
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similar form) and prospectuses, if any, filed by Company or any of
its Subsidiaries with any securities exchange or with the Securities
and Exchange Commission, and (c) all press releases and other
statements made available generally by Company or any of its
Subsidiaries to the public concerning material developments in the
business of Company or any of its Subsidiaries;
(ix) Events of Default, Failure to Meet Cash Balances
Requirement, etc.: promptly upon any officer of Company obtaining
knowledge (a) of any condition or event that constitutes an Event of
Default or Potential Event of Default, or becoming aware that any
Lender has given any notice (other than to Administrative Agent) or
taken any other action with respect to a claimed Event of Default or
Potential Event of Default, (b) that Borrowers are not in compliance
with the Cash Balances Requirement set forth in subsection 6.6(A)(v),
(c) that any Person has given any notice to Company or any of its
Subsidiaries or taken any other action with respect to a claimed
default or event or condition of the type referred to in subsection
7.2, (d) of any condition or event that would be required to be
disclosed in a current report filed by Company with the Securities
and Exchange Commission on Form 8-K (Items 1, 2, 4, 5 and 6 of such
Form as in effect on the Closing Date) if Company were required to
file such reports under the Exchange Act, or (e) of the occurrence of
any event or change that has caused or evidences, or could reasonably
be expected to cause or evidence, either in any case or in the
aggregate, a Material Adverse Effect, an Officers' Certificate
specifying the nature and period of existence of such condition,
event or change, or specifying the notice given or action taken by
any such Person and the nature of such claimed Event of Default,
Potential Event of Default, default, event or condition, and what
action Company has taken, is taking and proposes to take with respect
thereto;
(x) Litigation or Other Proceedings: promptly upon any
officer of Company obtaining knowledge of (a) the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting any Loan Party or any of its
Subsidiaries or any property of any Loan Party or any of its
Subsidiaries (collectively, "PROCEEDINGS") not previously disclosed
in writing by Company to Lenders or (b) any material development in
any Proceeding that, in any case:
(1) if adversely determined, has a
reasonable possibility of giving rise to a Material
Adverse Effect; or
seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or
obtain relief as a result of, the transactions
contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Company to enable Lenders and their counsel
to evaluate such matters;
(xi) ERISA Events: promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event that could
reasonably be expected to have a Material Adverse Effect, a written
notice specifying the nature thereof, what action Loan
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Parties or any of their respective ERISA Affiliates has taken, is
taking or proposes to take with respect thereto and, when known, any
action taken or threatened by the Internal Revenue Service, the
Department of Labor or the PBGC with respect thereto;
(xii) ERISA Notices: with reasonable promptness, copies
of (a) if requested by Administrative Agent, each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed
by Loan Parties or any of their respective ERISA Affiliates with the
Internal Revenue Service with respect to each Pension Plan; (b) all
notices received by Loan Parties or any of their respective ERISA
Affiliates from a Multiemployer Plan sponsor concerning an ERISA
Event that could reasonably be expected to have a Material Adverse
Effect; and (c) copies of such other documents or governmental
reports or filings relating to any Employee Benefit Plan as
Administrative Agent shall reasonably request;
(xiii) Financial Plans: as soon as practicable and in any
event no later than 45 days after the end of each Fiscal Year, a
consolidated plan and financial forecast for the next succeeding
Fiscal Year (the "FINANCIAL PLAN"), consisting of (a) a forecasted
consolidated balance sheet and forecasted consolidated statements of
income and cash flows of Company and its Subsidiaries for such Fiscal
Year, together with a pro forma Compliance Certificate for such
Fiscal Year and an explanation of the assumptions on which such
forecasts are based, (b) forecasted consolidated statements of income
and cash flows of Company and its Subsidiaries for each month of such
Fiscal Year, together with an explanation of the assumptions on which
such forecasts are based, and (c) such other information and
projections as any Lender may reasonably request;
(xiv) Insurance: as soon as practicable and in any event
by the last day of each Fiscal Year, a report in form and substance
satisfactory to Administrative Agent outlining all material insurance
coverage maintained as of the date of such report by Company and its
Subsidiaries and all material insurance coverage planned to be
maintained by Company and its Subsidiaries in the immediately
succeeding Fiscal Year;
(xv) Board of Directors: with reasonable promptness,
written notice of any change in the Board of Directors of Company;
(xvi) New Subsidiaries: promptly upon any Person becoming
a Subsidiary of Company, a written notice setting forth with respect
to such Person (a) the date on which such Person became a Subsidiary
of Company and (b) all of the data required to be set forth in
Schedule 4.1 annexed hereto with respect to all Subsidiaries of
Company (it being understood that such written notice shall be deemed
to supplement Schedule 4.1 annexed hereto for all purposes of this
Agreement);
(xvii) Licenses, etc.: promptly upon (a) receipt of
notice of (1) any forfeiture, non-renewal, cancellation, termination,
revocation, suspension, impairment or material modification of any
material License held by Company or any of its Subsidiaries, or any
notice of default or forfeiture with respect to any such material
License, or (2) any refusal by any Communications Regulatory
Authority to renew or extend any such material License, an Officers'
Certificate specifying the nature of such event, the period of
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existence thereof, and what action Company or its Subsidiaries are
taking and propose to take with respect thereto, and (b) any
acquisition of a Related Telecommunications Business, a written
notice setting forth with respect to the business acquired all of the
data required to be set forth in Schedule 4.1E under subsection 4.1E
with respect to such business and the material Licenses required in
connection with the operation of such business (it being understood
that such written notice shall be deemed to supplement Schedule 4.1E
annexed hereto for all purposes of this Agreement);
(xviii) UCC Search Report: As promptly as practicable after
the Closing Date or the date of delivery to Administrative Agent of
any subsequent UCC financing statements executed by any Loan Party
pursuant to subsection 3.1H(iv) of the Original Credit Agreement or
subsection 5.8A hereof, upon request of Administration Agent, copies
of completed UCC searches evidencing the proper filing, recording and
indexing of all such UCC financing statements and listing all other
effective financing statements that name such Loan Party as debtor,
together with copies of all such other financing statements not
previously delivered to Administrative Agent by or on behalf of
Company or such Loan Party;
(xix) Updated Financial Forecast Projections: no later
than October 30, 2000, updated financial forecast projections in form
and substance reasonably satisfactory to Arranger and Administrative
Agent;
(xx) Professional Advisor Materials: The Company shall
deliver to Lenders copies of any final engagement letters or other
agreements (with any specific compensation terms redacted therefrom),
pursuant to which the Company has engaged any professional advisor to
advise them with respect to potential asset sales or other strategic
alternatives and copies of any final offering memorandum or similar
documents prepared in connection with any proposed asset sales or
other strategic alternatives;
(xxi) Officers' Certificate for Cash Balance Requirement:
Concurrently with delivery of the monthly financial statements to be
delivered under subsection 6.1(i) and at any time within two Business
Days after request by Administrative Agent therefor, Company shall
deliver an Officers' Certificate certifying the compliance of Company
and its Restricted Subsidiaries with the Cash Balance Requirement and
setting forth the calculation of the Cash Balances including separate
line items stating the total amount of Cash and Cash Equivalents, the
amount of Cash or Cash Equivalents held in escrow or other restricted
accounts (including a separate line item for any ACSI Escrow Funds
permitted to be included in Cash Balances) and the amount of accounts
payable more than 60 days past due; and
(xxii) Other Information: With reasonable promptness,
such other information and data with respect to Company or any of its
Subsidiaries as from time to time may be reasonably requested by any
Lender.
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5.2 CORPORATE EXISTENCE, ETC.
Except as permitted under subsection 6.8, each Borrower will, and
will cause each of its Restricted Subsidiaries to, at all times preserve and
keep in full force and effect its corporate existence and all rights and
franchises material to its business; provided, however that neither Company
nor any of its Restricted Subsidiaries shall be required to preserve any such
right or franchise if the Board of Directors of Company or such Subsidiary
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of Company or such Subsidiary, as the case may be, and
that the loss thereof is not disadvantageous in any material respect to
Company, such Subsidiary or Lenders.
5.3 PAYMENT OF TAXES AND CLAIMS; TAX CONSOLIDATION.
(A) Company will, and will cause each of its Subsidiaries to, pay all
material taxes, assessments and other governmental charges imposed upon it or
any of its properties or assets or in respect of any of its income, businesses
or franchises before any material penalty accrues thereon, and all material
claims (including claims for labor, services, materials and supplies) for sums
that have become due and payable and that by law have or may become a Lien
upon any of its properties or assets, prior to the time when any material
penalty or fine shall be incurred with respect thereto; provided that no such
charge or claim need be paid if it is being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted, so long
as (1) such reserve or other appropriate provision, if any, as shall be
required in conformity with GAAP shall have been made therefor and (2) in the
case of a charge or claim which has or may become a Lien against any of the
Collateral, such contest proceedings conclusively operate to stay the sale of
any portion of the Collateral to satisfy such charge or claim.
(B) Neither Borrower will, nor will it permit any of its Subsidiaries
to, file or consent to the filing of any consolidated income tax return with
any Person (other than Company or any of its Subsidiaries).
5.4 MAINTENANCE OF PROPERTIES; INSURANCE; APPLICATION OF NET
INSURANCE/CONDEMNATION PROCEEDS.
(A) MAINTENANCE OF PROPERTIES. Each Borrower will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in good
repair, working order and condition, ordinary wear and tear excepted, all
material properties used or useful in the business of Company and its
Subsidiaries (including all Intellectual Property) and from time to time will
make or cause to be made all appropriate repairs, renewals and replacements
thereof.
(B) INSURANCE. Company will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance,
third party property damage insurance, business interruption insurance and
casualty insurance with respect to liabilities, losses or damage in respect of
the assets, properties and businesses of Company and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by
corporations of established reputation engaged in similar businesses, in each
case in such amounts (giving effect to self-insurance), with such deductibles,
covering such risks and otherwise on such terms and conditions as shall be
customary for corporations similarly situated in the industry. Without
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limiting the generality of the foregoing, Company will maintain or cause to be
maintained replacement value casualty insurance on the Collateral under such
policies of insurance, with such insurance companies, in such amounts, with
such deductibles, and covering such risks as are at all times satisfactory to
Administrative Agent in its commercially reasonable judgment. Each such policy
of insurance shall (a) name Administrative Agent for the benefit of Lenders as
an additional insured thereunder as its interests may appear and (b) in the
case of each business interruption and casualty insurance policy, contain a
loss payable clause or endorsement, satisfactory in form and substance to
Administrative Agent, that names Administrative Agent for the benefit of
Lenders as the loss payee thereunder and provides for at least 30 days prior
written notice to Administrative Agent of any modification or cancellation of
such policy.
(C) APPLICATION OF NET INSURANCE/CONDEMNATION PROCEEDS.
(i) Business Interruption Insurance. Upon receipt by
Company or any of its Restricted Subsidiaries of any business
interruption insurance proceeds constituting Net
Insurance/Condemnation Proceeds, (a) so long as no Event of Default
or Potential Event of Default shall have occurred and be continuing,
Company or such Subsidiary may retain and apply such Net
Insurance/Condemnation Proceeds for working capital purposes, and (b)
if an Event of Default or Potential Event of Default shall have
occurred and be continuing, Company shall apply an amount equal to
such Net Insurance/Condemnation Proceeds to prepay the Loans as
provided in subsection 2.4B(iii)(b);
(ii) Casualty Insurance/Condemnation Proceeds. Upon
receipt by Company or any of its Restricted Subsidiaries of any Net
Insurance/Condemnation Proceeds other than from business interruption
insurance, (a) so long as no Event of Default or Potential Event of
Default shall have occurred and be continuing, Company may deliver to
Administrative Agent an Officers' Certificate setting forth the
amount of the Net Insurance/Condemnation Proceeds received and that
Company or such Subsidiary intends to use such Net
Insurance/Condemnation Proceeds within 270 days of such date of
receipt to pay or reimburse the costs of repairing, restoring or
replacing the assets in respect of which such Net
Insurance/Condemnation Proceeds were received or to reinvest in
equipment or other Telecommunications Assets and Company shall, or
shall cause one or more of its Subsidiaries to, promptly and
diligently apply such to pay or reimburse the costs of repairing,
restoring or replacing the assets in respect of which such Net
Insurance/Condemnation Proceeds were received or reinvest all or a
portion thereof in equipment or other Telecommunications Assets or,
to the extent not so applied or reinvested, to prepay the Loans as
provided in subsection 2.4B(iii)(b), and (b) if an Event of Default
or Potential Event of Default shall have occurred and be continuing,
Company shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans as provided in
subsection 2.4B(iii)(b).
(iii) Net Insurance/Condemnation Proceeds Received by
Administrative Agent. Upon receipt by Administrative Agent of any
Net Insurance/Condemnation Proceeds as loss payee, (a) if and to the
extent Company would have been required to apply such Net
Insurance/Condemnation Proceeds (if it had received them directly) to
prepay the Loans, Administrative Agent shall, and Company hereby
authorizes
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Administrative Agent to, apply such Net Insurance/Condemnation
Proceeds to prepay the Loans as provided in subsection 2.4B(iii)(b),
and (b) to the extent the foregoing clause (a) does not apply,
Administrative Agent shall deliver such Net Insurance/Condemnation
Proceeds to Company, and Company shall, or shall cause one or more of
its Subsidiaries to, promptly and diligently apply such Net
Insurance/Condemnation Proceeds in accordance with subsection
5.4C(i)(a) or 5.4C(ii)(a), as applicable.
5.5 INSPECTION RIGHTS; AUDITS OF INVENTORY AND ACCOUNTS RECEIVABLE;
LENDER MEETING.
(A) INSPECTION RIGHTS. Each Borrower shall, and shall cause each of
its Subsidiaries to, permit any authorized representatives designated by any
Lender to visit and inspect any of the properties of Company or of any of its
Subsidiaries, to inspect, copy their financial and accounting records, and to
discuss its and their affairs, finances and accounts with its and their
officers and independent public accountants (provided that Company may, if it
so chooses, be present at or participate in any such discussion), all upon
reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested.
(B) LENDER MEETING. Each Borrower will, upon the request of Arranger,
Administrative Agent or Requisite Lenders, participate in a meeting of
Administrative Agent and Lenders once during each Fiscal Year to be held at
Company's corporate offices (or at such other location as may be agreed to by
Company and Administrative Agent) at such time as may be agreed to by Company
and Administrative Agent.
5.6 COMPLIANCE WITH LAWS, ETC.
Each Borrower shall comply, and shall cause each of its Subsidiaries
to comply, with the requirements of all applicable laws, rules, regulations
and orders of any governmental authority (including all Environmental Laws),
noncompliance with which could reasonably be expected to cause, individually
or in the aggregate, a Material Adverse Effect.
5.7 ENVIRONMENTAL REVIEW AND INVESTIGATION, DISCLOSURE, ETC.; COMPANY'S
ACTIONS REGARDING HAZARDOUS MATERIALS ACTIVITIES, ENVIRONMENTAL
CLAIMS AND VIOLATIONS OF ENVIRONMENTAL LAWS.
(A) ENVIRONMENTAL REVIEW AND INVESTIGATION. Each Borrower agrees that
Administrative Agent may, from time to time and in its reasonable discretion,
(i) retain, at Company's expense, an independent professional consultant to
review any environmental audits, investigations, analyses and reports relating
to Hazardous Materials prepared by or for any Loan Party and (ii) in the event
(a) Administrative Agent reasonably believes that any Loan Party has breached
any representation, warranty or covenant contained in subsection 4.6, 4.13,
5.6 or 5.7 which individually or in the aggregate could reasonably be expected
to have a Material Adverse Effect or that there has been a violation of
Environmental Laws which individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect at any Facility or by Company or
any of its Subsidiaries at any other location or (b) an Event of Default has
occurred and is continuing, conduct its own investigation of any Facility;
provided that, in the case of any Facility no longer owned, leased, operated
or used by Company or any of its Subsidiaries, Company shall only be obligated
to use commercially reasonable efforts to obtain permission for
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Administrative Agent's professional consultant to conduct an investigation of
such Facility. For purposes of conducting such a review and/or investigation,
each Borrower to the extent it has the power and authority to do so hereby
grants to Administrative Agent and its agents, employees, consultants and
contractors the right to enter into or onto any Facilities currently owned,
leased, operated or used by Company or any of its Subsidiaries and to perform
such tests on such property (including taking samples of soil, groundwater and
suspected asbestos-containing materials) as are reasonably necessary in
connection therewith. Any such investigation of any Facility shall be
conducted, unless otherwise agreed to by Borrowers and Administrative Agent,
during normal business hours and, to the extent reasonably practicable, shall
be conducted so as not to interfere with the ongoing operations at such
Facility or to cause any damage or loss to any property at such Facility.
Borrowers and Administrative Agent hereby acknowledge and agree that any
report of any investigation conducted at the request of Administrative Agent
pursuant to this subsection 5.7A will be obtained and shall be used by
Administrative Agent and Lenders for the purposes of Lenders' internal credit
decisions, to monitor and police the Loans and to protect Lenders' security
interests, if any, created by the Loan Documents. Administrative Agent agrees
to deliver a copy of any such report to Borrowers with the understanding that
each Borrower acknowledges and agrees that (1) it will indemnify and hold
harmless Administrative Agent and each Lender from any costs, losses or
liabilities relating to such Borrower's use of or reliance on such report, (2)
neither Administrative Agent nor any Lender makes any representation or
warranty with respect to such report, and (3) by delivering such report to
each Borrower, neither Administrative Agent nor any Lender is requiring or
recommending the implementation of any suggestions or recommendations
contained in such report.
(B) ENVIRONMENTAL DISCLOSURE. Borrowers will deliver to
Administrative Agent and Lenders:
(i) Environmental Audits and Reports. As soon as
practicable following receipt thereof, copies of all material and
non-privileged environmental audits, investigations, analyses and
reports of any kind or character, whether prepared by personnel of
Company or any of its Subsidiaries or by independent consultants,
governmental authorities or any other Persons, with respect to
significant environmental matters at any Facility which, individually
or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect or with respect to any Environmental Claims
which, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect;
(ii) Notice of Certain Releases, Remedial Actions, Etc.
Promptly upon the occurrence thereof, written notice describing in
reasonable detail (a) any Release required to be reported to any
federal, state or local governmental or regulatory agency under any
applicable Environmental Laws that could individually or in the
aggregate reasonably be expected to have a Material Adverse Effect,
(b) any remedial action taken by Company or any other Person in
response to (1) any Hazardous Materials Activities the existence of
which has a reasonable possibility of resulting in one or more
Environmental Claims that could, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, or (2) any
Environmental Claims that could, individually or in the aggregate,
reasonably be expected to have a reasonable possibility of resulting
in a Material Adverse Effect.
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(iii) Written Communications Regarding Environmental
Claims, Releases, Etc. As soon as practicable following the sending
or receipt thereof by Company or any of its Subsidiaries, a copy of
any and all material and non-privileged written communications with
respect to (a) any Environmental Claims that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect, (b) any Release required to be reported to any federal, state
or local governmental or regulatory agency that could reasonably be
expected to have, individually or in the aggregate, a Material
Adverse Effect, and (c) any request for information from any
governmental agency that suggests such agency is investigating
whether Company or any of its Subsidiaries may be potentially
responsible for any Hazardous Materials Activity that could
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(iv) Notice of Certain Proposed Actions Having
Environmental Impact. Prompt written notice describing in reasonable
detail (a) any proposed acquisition of stock, assets, or property by
Company or any of its Subsidiaries that could reasonably be expected
to (1) expose Company or any of its Subsidiaries to, or result in,
Environmental Claims that could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect or (2)
affect the ability of Company or any of its Subsidiaries to maintain
in full force and effect all material Governmental Authorizations
required under any Environmental Laws for their respective operations
and (b) any proposed action to be taken by Company or any of its
Subsidiaries to commence manufacturing or other industrial operations
or to modify current operations in a manner that could reasonably be
expected to subject Company or any of its Subsidiaries to any
additional obligations or requirements under any Environmental Laws
that could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.
(v) Other Information. With reasonable promptness, such
other non-privileged documents and information as from time to time
may be reasonably requested by Administrative Agent in relation to
any matters disclosed pursuant to this subsection 5.7.
(C) BORROWERS' ACTIONS REGARDING ENVIRONMENTAL CLAIMS AND VIOLATIONS
OF ENVIRONMENTAL LAWS. Each Borrower shall promptly take, and shall cause each
of its Subsidiaries promptly to take, any and all actions necessary to (i)
cure any violation of applicable Environmental Laws by Company or its
Subsidiaries that would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect except when, and only to the extent that,
such Borrower's or such Subsidiary's obligation to comply with Environmental
Laws is being contested in good faith by such Borrower or Subsidiary, and (ii)
make an appropriate response to any Environmental Claim against Company or any
of its Subsidiaries and discharge any obligations it may have to any Person
thereunder where failure to do so could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
5.8 EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS BY CERTAIN SUBSIDIARIES AND FUTURE SUBSIDIARIES.
(A) EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS. In the event that any Person becomes a Restricted Subsidiary of
Finance Sub after the date
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hereof, Borrowers will promptly notify Administrative Agent of that fact and
cause such Restricted Subsidiary (i) to execute and deliver to Administrative
Agent counterparts of the Subsidiary Guaranty, the Finance Sub and Other
Subsidiary Pledge and Security Agreement, the Intercompany Pledge and Security
Agreement and the Intercompany Purchase Money Note and (ii) to take all such
further actions and execute all such further documents and instruments
(including actions, documents and instruments comparable to those described in
subsection 3.1H of the Original Credit Agreement) as may be necessary or
requested by Administrative Agent.
(B) SUBSIDIARY ORGANIZATIONAL DOCUMENTS, LEGAL OPINIONS, ETC.
Borrowers shall deliver to Administrative Agent, together with the documents
required to be delivered pursuant to subsection 5.8A (the "SUBSIDIARY
DOCUMENTS"), (i) certified copies of such Subsidiary's Organizational
Documents certified by the Secretary of State of its jurisdiction of
organization, if such certification is generally available, and in each other
case by its secretary or assistant secretary together with, to the extent
generally available, a good standing certificate from the Secretary of State
of the jurisdiction of its organization and each other state in which such
Person is qualified as a foreign entity to do business, and a certificate or
other evidence of good standing as to payment of any applicable franchise or
similar taxes from the appropriate taxing authority of each of such
jurisdictions, each to be dated a recent date prior to their delivery to
Administrative Agent, (ii) a certificate executed by the secretary or an
assistant secretary of such Restricted Subsidiary as to (a) the fact that the
attached resolutions of the Board of Directors or board of managers or other
required authorizing authority of such Restricted Subsidiary approving and
authorizing the execution, delivery and performance of such Subsidiary
Documents are in full force and effect and have not been modified or amended
and (b) the incumbency and signatures of the officers of such Restricted
Subsidiary executing such Subsidiary Documents, and (iv) a favorable opinion
of counsel to such Restricted Subsidiary, in form and substance satisfactory
to Administrative Agent and its counsel, as to (a) the due organization and
good standing of such Restricted Subsidiary, (b) the due authorization,
execution and delivery by such Subsidiary of such Subsidiary Documents, (c)
the enforceability of such Subsidiary Documents against such Subsidiary, (d)
such other matters (including matters relating to the creation and perfection
of Liens in any Collateral pursuant to such Subsidiary Documents) as
Administrative Agent may reasonably request, all of the foregoing to be
satisfactory in form and substance to Administrative Agent and its counsel.
(C) FOREIGN SUBSIDIARIES. Notwithstanding anything in the foregoing
subsection 5.8A to the contrary, in the event that (i) any Person becomes a
Subsidiary of Finance Sub after the date hereof and such Subsidiary is a
controlled foreign corporation (as defined in Section 957(a) or a successor
provision of the Internal Revenue Code) and (ii) the execution of a
counterpart of the Subsidiary Guaranty and the Collateral Documents required
to be executed by such Subsidiary pursuant to this subsection 5.8A or such
Subsidiary continuing to be a party to the Subsidiary Guaranty and the
Collateral Documents, if previously executed, will result in material negative
tax consequences to Company, then the Lenders hereby agree to enter into an
amendment to this Agreement providing that (a) such foreign subsidiary shall
not be required to execute counterparts of the Subsidiary Guaranty or the
Collateral Documents or shall be released from the Subsidiary Guaranty and
Collateral Documents to which it is a party, if previously executed, and (b)
Finance Sub or its Subsidiaries, as the case may be, shall only be required to
pledge, or continue to pledge, 65% of the Capital Stock of such foreign
subsidiary, pursuant to the Collateral Documents, if permitted under
applicable foreign law, or pursuant to an additional
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pledge agreement or other documentation in conformity with applicable foreign
law to perfect Administrative Agent's security interest in such Capital Stock;
provided that (1) Borrowers shall agree to such amendments to this Agreement
as Lenders reasonably determine are necessary with respect to such foreign
subsidiary and (2) such amendment shall otherwise be in form and substance
reasonably satisfactory to Requisite Lenders. It being understood that if
following any such amendment in accordance with this subsection 5.8C, (x)
Administrative Agent or Requisite Lenders and Company reasonably determine at
any time that additional pledges of Capital Stock of any such foreign
subsidiary in excess of the 65% of the outstanding Capital Stock of such
foreign subsidiary or a guarantee from, or other creditors rights or security
interests in the assets of, any such foreign subsidiary (such additional
pledged stock, guaranties and creditors' rights and security interests in
assets, collectively, "ADDITIONAL SECURITY") may be obtained without Company
incurring any material tax liabilities, or (y) Administrative Agent and
Requisite Lenders agree to pay any additional tax liabilities incurred in
connection with the taking of Additional Security, Company shall cause such
Additional Security to be granted to Administrative Agent for the benefit of
Lenders, together with such supporting opinions of counsel and other documents
as Administrative Agent or Requisite Lenders shall reasonably request
consistent with the documents required to be delivered pursuant to subsection
5.8A.
Notwithstanding anything in this subsection 5.8C to the contrary, the
provisions of this subsection 5.8C shall not apply to Global Advanced Networks
(Europe) B.V. ("GANE") as long as GANE (i) satisfies the conditions set forth
in clauses (b) and (c) of the definition of an Unrestricted Subsidiary, (ii)
conducts no business activities and (ii) does not have assets in excess of
$25,000.
5.9 PREPAYMENT OF MASTER NOTE.
Finance Sub shall from time to time prepay the Master Note to the
extent necessary so that the aggregate outstanding amount under the Master
Note shall not at any time exceed the aggregate principal amounts outstanding
under the Intercompany Purchase Money Note.
5.10 INTEREST RATE PROTECTION.
For the period beginning 60 days after the Closing Date until the
third anniversary of the Closing Date, Borrowers shall maintain in effect one
or more Interest Rate Agreements such that not less than 50% of Consolidated
Total Debt of Company and its Restricted Subsidiaries bears interest at a
fixed rate or is capped or swapped into a fixed rate pursuant to an Interest
Rate Agreement, each such Interest Rate Agreement to be in form and substance
satisfactory to Administrative Agent.
5.11 CASH MANAGEMENT SYSTEMS.
Each Borrower shall, and shall cause each of its Restricted
Subsidiaries to, maintain the cash management system as described in Schedule
4.18 (as such system may be modified as permitted under this subsection 5.11,
the "CASH MANAGEMENT SYSTEM"). No later than 60 days after the Restatement
Effective Date, Borrowers shall have taken all action and executed all
documents reasonably requested by Administrative Agent to cause all Cash of
Company and each Subsidiary to be swept daily, in accordance with the Cash
Management System, into one or
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more Deposit Accounts held in the name of Finance Sub, subject to Collateral
Account Agreements giving Administrative Agent, for the benefit of Lenders, a
First Priority perfected security interest in such accounts. Notwithstanding
the above, Borrowers and the Restricted Subsidiaries may open and close
Deposit Accounts and make other changes to the Cash Management System in the
ordinary course of business upon prior written notice to Administrative Agent
and as long as (i) no Event of Default or Potential Event of Default has
occurred and is continuing or would result therefrom, (ii) such changes,
either individually or in the aggregate, do not impair any rights of
Administrative Agent under the Collateral Documents and (iii) Borrowers remain
in compliance with this subsection 5.11.
5.12 STOCKHOLDER AND NASDAQ APPROVALS FOR COMMITTED PREFERRED.
Company shall use its best efforts to obtain the Stockholder Approval
and any required NASDAQ approval as expeditiously as possible and to keep the
Lenders informed as to the progress of such efforts, including (i) filing a
preliminary proxy statement with the SEC in connection with calling a special
meeting of the stockholders to vote to approve the issuance of the Committed
Preferred and effect any increase in the authorized shares of the Company
necessary in connection therewith as soon as practicable after the Restatement
Effective Date, (ii) mailing the definitive proxy statement to stockholders as
soon as practicable after receiving SEC clearance, (iii) convening a special
meeting of stockholders as soon as practicable thereafter, and (iv) delivering
to Lenders copies of the preliminary and definitive proxy statements and any
correspondence with the SEC relating thereto.
5.13 LIQUIDITY REQUIREMENT.
Company shall satisfy the Liquidity Requirement.
SECTION 6.
BORROWERS' NEGATIVE COVENANTS
Each Borrower covenants and agrees that until payment in full of all
of the Loans and other Obligations, unless Requisite Lenders shall otherwise
give prior written consent, each Borrower shall perform, and shall cause each
Restricted Subsidiary to perform, all covenants in this Section 6.
6.1 INDEBTEDNESS.
Borrowers shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create, incur, assume or guaranty, or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(i) Borrowers may become and remain liable with respect
to the Obligations;
(ii) Company may remain liable with respect to the
Existing Senior Notes;
(iii) Company may become and remain liable with respect
to Additional Notes, provided, however, that Company shall be in pro
forma compliance with the covenants contained in this Agreement after
giving effect to the issuance thereof;
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(iv) Company and its Restricted Subsidiaries may become
and remain liable with respect to Contingent Obligations permitted by
subsection 6.4 and, upon any matured obligations actually arising
pursuant thereto, the Indebtedness corresponding to the Contingent
Obligations so extinguished;
(v) Company and any Restricted Subsidiary of Company
may become and remain liable with respect to Indebtedness to Company
or any Restricted Subsidiary of Company; provided that all such
intercompany Indebtedness shall be evidenced by intercompany
promissory notes in the form of the Master Note, the Intercompany
Purchase Money Note or the Intercompany Note, as applicable; and
(vi) (a) Company and its Restricted Subsidiaries may
become and remain liable with respect to existing Indebtedness
described in Schedule 6.1 annexed hereto, (b) Company may become and
remain liable with respect to Capital Lease Obligations and purchase
money Indebtedness, the proceeds of which are used within 180 days of
the incurrence thereof to purchase Telecommunications Assets in the
ordinary course of business, provided that (1) such Capital Lease
Obligations and purchase money Indebtedness are not secured by any
Lien on any asset of Company or any Restricted Subsidiary other than
such assets purchased with the proceeds of such Indebtedness (except,
in the case of purchase money Indebtedness, for Liens expressly
permitted by subsection 6.2A(iv)) and (2) at least 75% of the
purchase price plus installation costs of such assets is provided by
the proceeds of such Indebtedness, and (c) Company may become and
remain liable with respect to Indebtedness incurred to extend, renew
or refinance, in whole or in part, Indebtedness permitted under
clauses (a) and (b) of this clause (vi), provided that (1) the
principal amount of such refinancing Indebtedness does not exceed the
principal amount of, premium, if any, and accrued interest on, the
Indebtedness being refinanced immediately prior to such extension,
renewal or refinancing and (2) such refinancing Indebtedness has a
final maturity date not earlier than the maturity date of the
Indebtedness being refinanced and a Weighted Average Life to Maturity
equal to or greater than the Weighted Average Life to Maturity of the
Indebtedness being refinanced; provided that at no time shall (x) the
aggregate principal amount of Indebtedness outstanding under this
subsection 6.1(vi) exceed (1) $50,000,000 prior to the date Company
has received the Required Junior Capital or $200,000,000 after the
date the Company has received the Required Junior Capital plus (2) on
or after the later of (A) January 1, 2002 and (B) the date on which
both the Liquidity Requirement has been satisfied and Company has
received the Required Junior Capital (the "TRIGGER DATE") an amount
equal to two multiplied by the amount of any Subsequent Junior
Capital issued by the Company after the Trigger Date or (y) the sum
of the aggregate principal amount of Indebtedness outstanding under
this subsection 6.1(vi) plus the sum of the aggregate principal
amounts of Series B Term Loans and Series C Term Loans outstanding
exceed the Purchase Money Debt Allowance.
6.2 LIENS AND RELATED MATTERS.
(A) PROHIBITION ON LIENS. Borrowers shall not, and shall not permit
any Restricted Subsidiary to, directly or indirectly, create, incur, assume or
permit to exist any Lien on or with respect to any property or asset of any
kind (including any document or instrument in respect of
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<PAGE> 87
goods or accounts receivable) of Borrowers or any of its Restricted
Subsidiaries, whether now owned or hereafter acquired, or any income or
profits therefrom, or file or permit the filing of, or permit to remain in
effect, any financing statement or other similar notice of any Lien with
respect to any such property, asset, income or profits under the Uniform
Commercial Code of any State or under any similar recording or notice statute,
except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Existing Liens described in Schedule 6.2 annexed
hereto; and
(iv) Liens securing Indebtedness permitted pursuant to
subsection 6.1(vi) so long as such Liens relate solely to the assets
financed with such Indebtedness; provided that purchase money
Indebtedness permitted pursuant to subsection 6.1(vi) may also be
secured by subordinated Liens on the Collateral if the holder of such
Indebtedness enters into an intercreditor agreement in form and
substance satisfactory to Requisite Lenders in their sole discretion
pursuant to which (a) such Liens are subordinate to the Liens on the
Collateral granted to the Administrative Agent for the benefit of
Lenders and (b) any deficiency claims of such holder related to such
Indebtedness are subordinated to the Obligations.
(B) NO FURTHER NEGATIVE PLEDGES. Except with respect to specific
property encumbered to secure payment of particular Indebtedness (including
Indebtedness permitted under subsection 6.1(vi)) or to be sold pursuant to an
executed agreement with respect to an Asset Sale, neither Borrower nor any of
its Restricted Subsidiaries shall enter into any agreement (other than any
agreement prohibiting only the creation of Liens securing Subordinated
Indebtedness) prohibiting the creation or assumption of any Lien upon any of
its properties or assets, whether now owned or hereafter acquired (other than
in connection with Additional Notes permitted under subsection 6.1(iii),
provided that the covenants regarding Liens are no more restrictive to Company
and its Subsidiaries than those in the Existing Senior Note Indentures).
(C) NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS TO COMPANY OR OTHER
SUBSIDIARIES. Except as provided herein, each Borrower will not, and will not
permit any Restricted Subsidiaries to, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any
kind on the ability of any such Restricted Subsidiary to (i) pay dividends or
make any other distributions on any of such Restricted Subsidiary's Capital
Stock owned by Company or any other Restricted Subsidiary of Company, (ii)
repay or prepay any Indebtedness owed by such Restricted Subsidiary to Company
or any other Restricted Subsidiary of Company, (iii) make loans or advances to
Company or any other Restricted Subsidiary of Company, or (iv) transfer any of
its property or assets to Company or any other Restricted Subsidiary of
Company, except for such encumbrances or restrictions existing under or by
reason of (a) any restrictions existing under the Loan Documents and (b) any
restriction with respect to a Restricted Subsidiary imposed pursuant to an
agreement that has been entered into in connection with the disposition of all
or substantially all of the Capital Stock or assets of such Restricted
Subsidiary.
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<PAGE> 88
6.3 INVESTMENTS; JOINT VENTURES.
Borrowers shall not, and shall not permit any Restricted Subsidiaries
to, directly or indirectly, make or own any Investment in any Person,
including any Joint Venture, except:
(i) Company and its Restricted Subsidiaries may make
and own Investments in Cash and Cash Equivalents;
(ii) Company and its Restricted Subsidiaries may make
intercompany loans to the extent permitted under subsection 6.1(v);
(iii) Company and its Restricted Subsidiaries may
continue to own the Investments owned by them and described on
Schedule 6.3 annexed hereto;
(iv) Company and its Restricted Subsidiaries may
continue to own the Investments owned by them as of the Closing Date
(after giving effect to the Restructuring) in any Subsidiaries of
Company;
(v) Company and its Restricted Subsidiaries may make
additional Investments in Restricted Subsidiaries;
(vi) Company and its Restricted Subsidiaries may make
and own Telecommunications Acquisitions to the extent permitted by
subsection 6.9;
(vii) Company and its Restricted Subsidiaries may make
and own Investments in Joint Ventures or other Persons; provided that
the aggregate amount of such Investments does not exceed $10,000,000
at any time;
(viii) Company and its Restricted Subsidiaries may make
loans and advances to members of management of Company, provided that
the aggregate amount of such management loans outstanding shall not
exceed $2,200,000 at any time; and
(ix) Company and its Restricted Subsidiaries may make
Investments consisting of notes received in connection with any Asset
Sale permitted pursuant to subsection 6.8; provided that in each case
the principal amount of such notes received shall not exceed 25% of
the total consideration received for the assets or property sold in
such Asset Sale and any promissory note or notes received in
connection with any single Asset Sale or series of related Asset
Sales in excess of $200,000 shall be pledged to Administrative Agent,
for the benefit of Lenders, to secure the Obligations.
6.4 CONTINGENT OBLIGATIONS.
Borrowers shall not, and shall not permit any Restricted Subsidiaries
to, directly or indirectly, create or become or remain liable with respect to
any Contingent Obligation, except:
(i) Company may become and remain liable with respect
to Contingent Obligations in respect of the Company Guaranty, and
Restricted Subsidiaries of
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<PAGE> 89
Company may become and remain liable with respect to Contingent
Obligations in respect of the Subsidiary Guaranty;
(ii) Company may become and remain liable with respect
to Contingent Obligations under Hedge Agreements;
(iii) Company and its Restricted Subsidiaries, as
applicable, may remain liable with respect to Contingent Obligations
described in Schedule 6.4 annexed hereto;
(iv) Company may become and remain liable with respect
to standby letters of credit provided by Company in the ordinary
course of business in an aggregate principal amount not to exceed
$30,000,000 at any time outstanding; and
(v) Company may become and remain liable with respect
to guaranties of liabilities of Restricted Subsidiaries and Restricted
Subsidiaries may become and remain liable with respect to guaranties of
liabilities of other Restricted Subsidiaries, in each case to the
extent such guarantied liabilities are permitted to be incurred
hereunder.
6.5 RESTRICTED JUNIOR PAYMENTS.
Company shall not, directly or indirectly, declare, order, pay, make
or set apart any sum for any Restricted Junior Payment; provided that so long
as no Event of Default or Potential Event of Default shall have occurred and
be continuing or shall be caused thereby:
(i) Company may make regularly scheduled interest
payments in respect of the Existing Senior Notes and any Additional
Notes in accordance with the terms of, and only to the extent
required by, and subject to the subordination provisions, if any,
contained in, the Existing Senior Note Indentures or any indenture or
indentures pursuant to which any Additional Notes are issued;
(ii) Company may declare and pay regularly scheduled
dividends in respect of the Existing Preferred Stock, provided that
(a) the Leverage Ratio is equal to or less than 5.0:1.0, and (b)
Company shall be in compliance with each covenant under subsection
6.6 after giving pro forma effect to such dividend;
(iii) Company may (a) repurchase or redeem outstanding
Capital Stock of Company with the net proceeds received by Company
from the issuance of its Capital Stock of the same class or Capital
Stock which is junior to the Capital Stock being repurchased or
redeemed, provided that notwithstanding any other provision in this
Agreement to the contrary, to the extent the proceeds of any issuance
of Capital Stock are used to repurchase or redeem outstanding Capital
Stock in accordance with this subsection 6.5(iii)(a), such Capital
Stock shall not constitute Required Junior Capital, Qualified
Additional Capital or Subsequent Junior Capital, (b) make Cash
Payments to repurchase or redeem fractional shares of Capital Stock
in connection with a repurchase or redemption permitted pursuant to
clause (a) of this subsection 6.5(iii), and (c) make Cash Payments in
lieu of the issuance of fractional shares of preferred stock in
connection with the payment of pay-in-kind dividends on the preferred
stock; provided
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<PAGE> 90
the aggregate amount of Cash Payments made pursuant to clauses (b)
and (c) of this subsection 6.5(iii) shall not exceed $200,000 in any
Fiscal Year; and
(iv) to the extent Company makes any issuance of
Additional Notes, Company may use the net Cash proceeds from such
Additional Notes to redeem, repurchase or defease Indebtedness of
Company and its Restricted Subsidiaries, provided that
notwithstanding any other provision in this Agreement to the
contrary, to the extent the proceeds of any Additional Notes are used
to redeem, repurchase or defease Indebtedness of Company and its
Restricted Subsidiaries in accordance with this subsection 6.5(iv),
such Additional Notes shall not constitute Required Junior Capital,
Qualified Additional Capital or Subsequent Junior Capital.
6.6 FINANCIAL COVENANTS
(A) PHASE 1 FINANCIAL COVENANTS. From June 30, 2000 through August
11, 2006, Borrowers shall comply with the following financial covenants:
(i) Consolidated Total Debt to Total Gross
Capitalization; and Consolidated Senior Debt to Total Gross
Capitalization. As of the last day of any Fiscal Quarter, (a)
Borrowers' ratio of Consolidated Total Debt to Total Gross
Capitalization shall not exceed (1) 0.70:1 for the Fiscal Quarter
ended June 30, 2000 or (2) 0.75:1 thereafter and (b) Borrowers' ratio
of Consolidated Senior Debt to Total Gross Capitalization shall not
exceed 0.25:1.
(ii) Minimum Consolidated Quarterly Revenues. As of the
last day of any Fiscal Quarter specified below, Borrowers shall not
permit (a) Consolidated Quarterly Revenue for ACSI or (b) as long as
Cybergate is a Restricted Subsidiary of Company, Consolidated
Quarterly Revenue for Cybergate and ICP on a combined basis or (c) at
any time after Cybergate ceases to be a Restricted Subsidiary of
Company, Consolidated Quarterly Revenue for ICP on a stand alone
basis, for such Fiscal Quarter to be less than the correlative amount
indicated below:
<TABLE>
<CAPTION>
MINIMUM CONSOLIDATED QUARTERLY REVENUE
(in thousands)
---------------------------------------------------------
QUARTER ENDED ACSI CYBERGATE AND ICP ICP
------------------------------- ------------------- ------------------ ------------------
<S> <C> <C> <C>
June 30, 2000 $13,250 $59,000 $52,000
------------------------------- ------------------- ------------------ ------------------
September 30, 2000 12,775 58,000 52,000
------------------------------- ------------------- ------------------ ------------------
December 31, 2000 12,000 63,000 56,000
------------------------------- ------------------- ------------------ ------------------
March 31, 2001 11,500 71,000 62,000
------------------------------- ------------------- ------------------ ------------------
June 30, 2001 11,000 77,000 67,000
------------------------------- ------------------- ------------------ ------------------
September 30, 2001 11,000 83,000 72,000
------------------------------- ------------------- ------------------ ------------------
December 31, 2001 11,500 91,000 77,000
------------------------------- ------------------- ------------------ ------------------
March 31, 2002 10,500 94,000 79,000
------------------------------- ------------------- ------------------ ------------------
</TABLE>
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<PAGE> 91
<TABLE>
<CAPTION>
MINIMUM CONSOLIDATED QUARTERLY REVENUE
(in thousands)
---------------------------------------------------------
QUARTER ENDED ACSI CYBERGATE AND ICP ICP
------------------------------- ------------------- ------------------ ------------------
<S> <C> <C> <C>
June 30, 2002 9,500 101,000 84,000
------------------------------- ------------------- ------------------ ------------------
September 30, 2002 8,500 107,000 89,000
------------------------------- ------------------- ------------------ ------------------
December 31, 2002 7,250 115,000 94,000
------------------------------- ------------------- ------------------ ------------------
March 31, 2003 12,500 119,000 96,000
------------------------------- ------------------- ------------------ ------------------
June 30, 2003 13,250 128,000 101,000
------------------------------- ------------------- ------------------ ------------------
September 30, 2003 14,000 137,000 107,000
------------------------------- ------------------- ------------------ ------------------
December 31, 2003 14,750 148,000 112,000
------------------------------- ------------------- ------------------ ------------------
March 31, 2004 15,500 153,000 114,000
------------------------------- ------------------- ------------------ ------------------
June 30, 2004 16,250 164,000 119,000
------------------------------- ------------------- ------------------ ------------------
September 30, 2004 17,000 176,000 125,000
------------------------------- ------------------- ------------------ ------------------
December 31, 2004 17,750 187,000 130,000
------------------------------- ------------------- ------------------ ------------------
March 31, 2005 18,750 194,000 136,000
------------------------------- ------------------- ------------------ ------------------
June 30, 2005 19,750 207,000 142,000
------------------------------- ------------------- ------------------ ------------------
September 30, 2005 20,000 220,000 145,000
------------------------------- ------------------- ------------------ ------------------
December 31, 2005 20,750 230,000 150,000
------------------------------- ------------------- ------------------ ------------------
March 31, 2006 21,500 240,000 155,000
------------------------------- ------------------- ------------------ ------------------
June 30, 2006 22,250 250,000 160,000
------------------------------- ------------------- ------------------ ------------------
</TABLE>
Notwithstanding anything herein to the contrary, compliance
with the covenant set forth in subsection 6.6A(ii)(a) shall be tested
on the basis of (i) Consolidated Quarterly Revenue of ACSI for the
Fiscal Quarter ended June 30, 2000, (ii) the quarterly average of
Consolidated Quarterly Revenue of ACSI for the two-Fiscal Quarter
period ended September 30, 2000, (iii) the quarterly average of
Consolidated Quarterly Revenue of ACSI for the three-Fiscal Quarter
period ended December 31, 2000 and (iv) thereafter, the quarterly
average of Consolidated Quarterly Revenue of ACSI for the rolling
four-Fiscal Quarter period then ended (i.e., Consolidated Quarterly
Revenue of ACSI for the four-Fiscal Quarter period then ended divided
by four).
(iii) Minimum Consolidated Adjusted EBITDA. As of the
last day of any Fiscal Quarter specified below, Borrowers shall not
permit Consolidated Adjusted EBITDA of Company and its Restricted
Subsidiaries for such Fiscal Quarter to be less than the correlative
amount indicated:
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<PAGE> 92
<TABLE>
<CAPTION>
MINIMUM CONSOLIDATED ADJUSTED EBITDA
QUARTER ENDED (in thousands)
------------------------------ ----------------------------------------------------------
<S> <C>
June 30, 2000 $(16,200)
------------------------------ ----------------------------------------------------------
September 30, 2000 (20,200)
------------------------------ ----------------------------------------------------------
December 31, 2000 (16,250)
------------------------------ ----------------------------------------------------------
March 31, 2001 (15,700)
------------------------------ ----------------------------------------------------------
June 30, 2001 (13,350)
------------------------------ ----------------------------------------------------------
September 30, 2001 (10,850)
------------------------------ ----------------------------------------------------------
December 31, 2001 (5,600)
------------------------------ ----------------------------------------------------------
March 31, 2002 (6,900)
------------------------------ ----------------------------------------------------------
June 30, 2002 (3,950)
------------------------------ ----------------------------------------------------------
September 30, 2002 (850)
------------------------------ ----------------------------------------------------------
December 31, 2002 2,700
------------------------------ ----------------------------------------------------------
March 31, 2003 3,500
------------------------------ ----------------------------------------------------------
June 30, 2003 8,300
------------------------------ ----------------------------------------------------------
September 30, 2003 13,000
------------------------------ ----------------------------------------------------------
December 31, 2003 18,700
------------------------------ ----------------------------------------------------------
March 31, 2004 21,400
------------------------------ ----------------------------------------------------------
June 30, 2004 28,000
------------------------------ ----------------------------------------------------------
September 30, 2004 33,600
------------------------------ ----------------------------------------------------------
December 31, 2004 39,500
------------------------------ ----------------------------------------------------------
March 31, 2005 49,000
------------------------------ ----------------------------------------------------------
June 30, 2005 57,750
------------------------------ ----------------------------------------------------------
September 30, 2005 60,000
------------------------------ ----------------------------------------------------------
December 31, 2005 67,500
------------------------------ ----------------------------------------------------------
March 31, 2006 72,000
------------------------------ ----------------------------------------------------------
June 30, 2006 76,500
------------------------------ ----------------------------------------------------------
</TABLE>
For purposes of determining compliance with this covenant,
the Consolidated Adjusted EBITDA for ACSI to be included in such
calculations shall be determined on the basis of (i) Consolidated
Adjusted EBITDA of ACSI for the Fiscal Quarter ended June 30, 2000,
(ii) the quarterly average of Consolidated Adjusted EBITDA of ACSI
for the two-Fiscal Quarter period ended September 30, 2000, (iii) the
quarterly average of Consolidated Adjusted EBITDA for ACSI for the
three-Fiscal Quarter period ended December 31, 2000 and (iv)
thereafter the quarterly average of Consolidated Adjusted EBITDA for
ACSI for the rolling four Fiscal Quarter period then ended (i.e.,
Consolidated Adjusted EBITDA of ACSI for the four-Fiscal Quarter
period then ended divided by four).
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<PAGE> 93
(iv) Adjustment. In the event that Cybergate's dial-up
division is sold separately, the covenant levels for Minimum
Consolidated Quarterly Revenue for Cybergate and ICP and Minimum
Consolidated Adjusted EBITDA for the Company and its Restricted
Subsidiaries shall each be reduced by the corresponding Consolidated
Quarterly Revenue and Consolidated Adjusted EBITDA attributable to
such division as set forth in the projections which are attached
hereto as Exhibit XIV.
(v) Minimum Cash Balances. Borrowers shall not permit
the Cash Balances of the Company and its Restricted Subsidiaries at
any time be less than the Cash Balance Requirement.
(B) PHASE 2 FINANCIAL COVENANTS. From and after January 1, 2004
(except as otherwise specified), Borrowers shall comply with the following
financial covenants:
(i) [Intentionally Omitted]
(ii) [Intentionally Omitted].
(iii) Maximum Leverage Ratio. Borrowers shall not permit
(a) the ratio of Consolidated Senior Debt to Consolidated Annualized
EBITDA of Company and its Restricted Subsidiaries or (b) the ratio of
Consolidated Total Debt to Consolidated Annualized EBITDA of Company
and its Restricted Subsidiaries as of the last day of any Fiscal
Quarter set forth below to exceed the correlative ratios indicated:
<TABLE>
<CAPTION>
QUARTER ENDED SENIOR DEBT RATIO TOTAL DEBT RATIO
--------------------------------------------- --------------------- ---------------------
<S> <C> <C>
March 31, 2004 8.50:1 20.00:1
--------------------------------------------- --------------------- ---------------------
June 30, 2004 7.00:1 16.00:1
--------------------------------------------- --------------------- ---------------------
September 30, 2004 6.00:1 13.50:1
--------------------------------------------- --------------------- ---------------------
December 31, 2004 5.50:1 11.75:1
--------------------------------------------- --------------------- ---------------------
March 31, 2005 4.75:1 10.00:1
--------------------------------------------- --------------------- ---------------------
June 30, 2005 4.25:1 8.75:1
--------------------------------------------- --------------------- ---------------------
September 30, 2005 4.00:1 7.75:1
--------------------------------------------- --------------------- ---------------------
December 31, 2005 3.00:1 7.00:1
--------------------------------------------- --------------------- ---------------------
March 31, 2006 3.00:1 6.50:1
--------------------------------------------- --------------------- ---------------------
June 30, 2006 3.00:1 6.25:1
--------------------------------------------- --------------------- ---------------------
</TABLE>
(iv) Certain Calculations. With respect to calculations
of Consolidated Adjusted EBITDA, Consolidated Cash Interest Expense
and Consolidated Quarterly Revenues for purposes of determining
compliance with subsections 6.6A(ii) and (iii) and 6.6B(iii), for any
Fiscal Quarter during which any Telecommunications Acquisition
permitted under this Agreement was consummated or any Asset Sale (as
defined in clauses (i) or (ii) of the definition of Asset Sale)
permitted under this Agreement was
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<PAGE> 94
consummated, such calculations shall be made on a pro forma basis
assuming, in each case, that such Telecommunications Acquisition or
such Asset Sale was consummated on the first day of the applicable
Fiscal Quarter. All such calculations shall be in form and substance
satisfactory to Arranger and Administrative Agent.
(C) CONSOLIDATED CASH CAPITAL EXPENDITURES. From and after March 31,
2000, Borrowers shall not, and shall not permit any Restricted Subsidiaries to
make or incur Consolidated Cash Capital Expenditures, in any six-month period
indicated below, in an aggregate amount in excess of the corresponding amount
(the "MAXIMUM CONSOLIDATED CASH CAPITAL EXPENDITURES AMOUNT") set forth below
opposite such period; provided that the Maximum Consolidated Cash Capital
Expenditures Amount for any six-month period shall be increased by an amount
equal to the excess, if any, (but in no event more than 50% of such excess) of
the Maximum Consolidated Cash Capital Expenditures Amount for the previous
six-month period (as adjusted in accordance with this proviso) over the actual
amount of Consolidated Cash Capital Expenditures for such previous six-month
period:
<TABLE>
<CAPTION>
MAXIMUM CONSOLIDATED CASH
CAPITAL EXPENDITURES
SIX-MONTH PERIOD ENDED (in thousands)
--------------------------------------------- -------------------------------------------
<S> <C>
September 30, 2000 $124,000
--------------------------------------------- -------------------------------------------
March 31, 2001 126,000
--------------------------------------------- -------------------------------------------
September 30, 2001 71,000
--------------------------------------------- -------------------------------------------
March 31, 2002 53,000
--------------------------------------------- -------------------------------------------
September 30, 2002 52,000
--------------------------------------------- -------------------------------------------
March 31, 2003 53,000
--------------------------------------------- -------------------------------------------
September 30, 2003 57,000
--------------------------------------------- -------------------------------------------
March 31, 2004 59,000
--------------------------------------------- -------------------------------------------
September 30, 2004 59,000
--------------------------------------------- -------------------------------------------
March 31, 2005 65,000
--------------------------------------------- -------------------------------------------
September 30, 2005 65,000
--------------------------------------------- -------------------------------------------
March 31, 2006 65,000
--------------------------------------------- -------------------------------------------
</TABLE>
In addition to the foregoing, from and after the date Company has received the
Required Junior Capital, Borrowers and any Restricted Subsidiaries may make
Consolidated Cash Capital Expenditures in an aggregate amount up to
$50,000,000.
Notwithstanding anything in the foregoing to the contrary, (i)
Company and its Restricted Subsidiaries shall not be permitted to make or
incur Consolidated Cash Capital Expenditures, except within existing markets
of Company and its Restricted Subsidiaries as of the Restatement Effective
Date and (ii) ACSI shall not make or incur any Consolidated Cash Capital
Expenditures except (a) to design networks for third parties in the ordinary
course of business
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<PAGE> 95
not to exceed an aggregate amount of $5,000,000 and (b) to build networks for
third party customers in the ordinary course of business pursuant to binding
written contracts with such customers. Prior to the date the Liquidity
Requirement is met, any Cash used to make Telecommunications Acquisitions
shall be counted as Consolidated Cash Capital Expenditures for purposes of
this subsection 6.1C. From and after the date the Liquidity Requirement is
met, one-third of the Cash used to make Telecommunications Acquisitions shall
be counted as Consolidated Cash Capital Expenditures for purposes of this
subsection 6.1C.
(D) Minimum Access Lines. Borrowers shall not permit the combined
total of voice, data and ISP lines (DSO Equivalents) of Company and its
Restricted Subsidiaries as of the end of any Fiscal Quarter to be less than
the correlative amount indicated.
<TABLE>
<CAPTION>
QUARTER ENDED MINIMUM ACCESS LINES
--------------------------------------------- -------------------------------------------
<S> <C>
June 30, 2000 183,000
--------------------------------------------- -------------------------------------------
September 30, 2000 208,000
--------------------------------------------- -------------------------------------------
December 31, 2000 240,000
--------------------------------------------- -------------------------------------------
March 31, 2001 266,000
--------------------------------------------- -------------------------------------------
June 30, 2001 282,000
--------------------------------------------- -------------------------------------------
September 30, 2001 300,000
--------------------------------------------- -------------------------------------------
December 31, 2001 318,000
--------------------------------------------- -------------------------------------------
March 31, 2002 338,000
--------------------------------------------- -------------------------------------------
June 30, 2002 358,000
--------------------------------------------- -------------------------------------------
September 30, 2002 378,000
--------------------------------------------- -------------------------------------------
December 31, 2002 398,000
--------------------------------------------- -------------------------------------------
March 31, 2003 421,000
--------------------------------------------- -------------------------------------------
June 30, 2003 445,000
--------------------------------------------- -------------------------------------------
September 30, 2003 468,000
--------------------------------------------- -------------------------------------------
December 31, 2003 and each quarter 491,000
thereafter
--------------------------------------------- -------------------------------------------
</TABLE>
6.7 [INTENTIONALLY OMITTED]
6.8 RESTRICTION ON FUNDAMENTAL CHANGES; ASSET SALES.
Company shall at no time create, acquire or otherwise have any direct
Subsidiary other than Finance Sub. Borrowers shall not, and shall not permit
any Restricted Subsidiary to, alter the corporate, capital or legal structure
of Borrowers or any Restricted Subsidiaries, or enter into any transaction of
merger or consolidation, or liquidate, wind-up or dissolve itself (or suffer
any liquidation or dissolution), or convey, sell, lease or sub-lease (as
lessor or sublessor), transfer or otherwise dispose of, in one transaction or
a series of transactions, all or any part of its business, property or assets,
whether now owned or hereafter acquired, except:
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<PAGE> 96
(i) any Restricted Subsidiary of Company may be merged
with or into any Wholly Owned Subsidiary Guarantor, or be liquidated,
wound up or dissolved, or all or any part of its business, property
or assets may be conveyed, sold, leased, transferred or otherwise
disposed of, in one transaction or a series of transactions, to any
Wholly Owned Subsidiary Guarantor; provided that, in the case of such
a merger, such Wholly Owned Subsidiary Guarantor shall be the
continuing or surviving corporation;
(ii) Borrowers and Restricted Subsidiaries may dispose
of obsolete, worn out or surplus property in the ordinary course of
business;
(iii) Borrowers and Restricted Subsidiaries may sell or
otherwise dispose of assets in transactions that do not constitute
Asset Sales; provided that the consideration received for such assets
shall be in an amount at least equal to the fair market value
thereof;
(iv) subject to subsection 6.13, Borrowers and
Restricted Subsidiaries may during any Fiscal Year make Asset Sales
of assets which generated revenues comprising not more than 15% of
consolidated revenues of Company and its Restricted Subsidiaries for
the prior Fiscal Year; provided that (a) the consideration received
for such assets shall be in an amount at least equal to the fair
market value thereof; (b) 75% of the consideration received shall be
Cash; and (c) the proceeds of such Asset Sales shall be applied as
required by subsection 2.4B(iii)(a);
(v) Company may issue (a) common stock and warrants to
purchase common stock, (b) the Bridge Preferred and/or the Committed
Preferred having terms (other than pricing) substantially identical
(and in any event with no changes which are adverse to the Lenders)
to those set forth in the certificates of designation in the forms of
Exhibit XV and Exhibit XVI, respectively, annexed hereto or, to the
extent the terms of the Bridge Preferred or Committed Preferred are
not substantially identical to such terms, such non-conforming terms
(1) relate to which holders or the percentage of holders that may
exercise voting rights or consent to amendments and waivers, (2) are
to the seniority, registration rights or anti-dilution provisions, or
(3) are to the covenant or default provisions as long as such
covenants and defaults as so modified are no more restrictive to the
Company than those set forth in Exhibit XV and Exhibit XVI,
respectively, and (c) other preferred stock and warrants to purchase
preferred stock; provided that the terms of such preferred stock and
warrants to purchase preferred stock referenced in this clause (c)
are approved by Requisite Lenders;
(vi) Borrowers and Restricted Subsidiaries may make
Asset Sales consisting of dispositions of assets pursuant to Use
Agreements, provided that the proceeds of such Asset Sales shall be
applied as required pursuant to subsection 2.4B(iii)(a);
(vii) ACSI may make ACSI Network Sales; and
(viii) Borrowers may sell all of the Capital Stock or all
or substantially all of the assets of ACSI and/or Cybergate, provided
that the consideration received therefor shall
88
<PAGE> 97
be in an amount at least equal to the fair market value thereof and
subject to documentation in form and substance reasonably
satisfactory to Requisite Lenders.
6.9 ACQUISITIONS.
Borrowers shall not, and shall not permit any Restricted Subsidiaries
to, acquire by purchase or otherwise all or substantially all of the business,
property or fixed assets of, or stock or other evidence of beneficial
ownership of, any Person or any division or line of business of any Person,
except:
(i) Company and its Restricted Subsidiaries may make
Consolidated Cash Capital Expenditures permitted under subsection
6.6C;
(ii) Telecommunications Acquisitions; provided that (a)
prior to the date the Liquidity Requirement is met, the aggregate
cumulative Cash consideration for all such acquisitions shall not
exceed $10,000,000 per Fiscal Year, (b) from and after the date the
Liquidity Requirement is met, the aggregate Cash consideration for
all such acquisitions shall not exceed $30,000,000 per Fiscal Year
and (c) at least five Business Days prior to the date of the
consummation of such acquisition, Company shall deliver to the
Lenders and Administrative Agent (1) pro forma financial statements
for the acquired Person giving effect to such acquisition
demonstrating that the pro forma annualized EBITDA for the acquired
Person (based upon the last two quarters multiplied by two) is either
positive or, if negative, is not negative in an amount greater than
$1,000,000 and (2) projected financial statements for Company and its
Restricted Subsidiaries on a consolidated basis through the Maturity
Date giving pro forma effect to such acquisition demonstrating that
Borrowers shall be in pro forma compliance with all of the covenants
contained in this Agreement through the Maturity Date; and
(iii) Telecommunications Acquisitions for which the
consideration is common stock of the Company.
In the event Borrowers desire to obtain the consent of Requisite
Lenders to any acquisition not otherwise permitted under this subsection 6.9,
Company shall notify Administrative Agent. Administrative Agent shall notify
Lenders as soon as practicable following receipt of a request for consent to
an acquisition from Company and shall cooperate with Company in seeking to
obtain Requisite Lenders' approval of such request within a commercially
reasonable time period taking into account all relevant factors at the time of
such request.
6.10 SALES AND LEASE-BACKS.
Borrowers shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, become or remain liable as lessee or as a
guarantor or other surety with respect to any lease, whether an Operating
Lease or a Capital Lease, of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, (i) which Borrowers or any Restricted
Subsidiary has sold or transferred or is to sell or transfer to any other
Person (other than Borrower or any Restricted Subsidiaries) or (ii) which
Borrowers or any Restricted Subsidiary intends to use for substantially the
same purpose as any other property which has been or is to be
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sold or transferred by Company or any Restricted Subsidiary to any Person
(other than Borrower or any Restricted Subsidiaries) in connection with such
lease.
6.11 SALE OR DISCOUNT OF RECEIVABLES.
Borrowers shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, sell with recourse, or discount or otherwise sell
for less than the face value thereof, any of its notes or accounts receivable.
Nothing in this subsection 6.11 shall prevent Borrowers or any Restricted
Subsidiary from (i) settling an account with the obligor thereon for less than
the face value of such account if in the ordinary course of business it is
determined that such settlement is necessary to collect such account or (ii)
selling delinquent accounts at a discount to a third party for collection
purposes.
6.12 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.
Borrowers shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, enter into or permit to exist any transaction
(including the purchase, sale, lease or exchange of any property or the
rendering of any service) with any holder of 5% or more of any class of equity
Securities of Company or with any Affiliate of Company or of any such holder,
on terms that are less favorable to Borrower or that Restricted Subsidiary, as
the case may be, than those that would be obtained at the time from Persons
who are not such a holder or Affiliate; provided that the foregoing
restriction shall not apply to (i) any transaction between Borrowers and any
of its Wholly Owned Subsidiaries or between any of its Wholly Owned
Subsidiaries, (ii) reasonable and customary fees paid or stock options awarded
to members of the Boards of Directors of Borrowers and their Restricted
Subsidiaries, (iii) the transactions pursuant to the Huff Purchase Agreement
(including without limitation in Section 1 thereof) and (iv) the transactions
pursuant to the agreement referred to in subsection 3.1I(ii).
6.13 DISPOSAL OF SUBSIDIARY STOCK.
Except for any sale of 100% of the Capital Stock of a Subsidiary in
compliance with subsection 6.8, Borrowers shall not:
(i) directly or indirectly sell, assign, pledge or
otherwise encumber or dispose of any shares of Capital Stock or other
equity Securities of any Restricted Subsidiaries, except to qualify
directors if required by applicable law; or
(ii) permit any Restricted Subsidiary directly or
indirectly to sell, assign, pledge or otherwise encumber or dispose
of any shares of Capital Stock or other equity Securities of any
Restricted Subsidiaries (including such Subsidiary), except to
Company, another Restricted Subsidiary of Company, or to qualify
directors if required by applicable law.
6.14 CONDUCT OF BUSINESS.
From and after the Closing Date, Borrowers shall not, and shall not
permit any Restricted Subsidiary to, engage in any business other than the
telecommunications businesses engaged in by Company and its Restricted
Subsidiaries on the Closing Date and similar or related businesses
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and such other lines of business as may be consented to by Requisite Lenders.
From and after the Closing Date, Company shall not engage in any business or
activities other than (a) owning the stock of Finance Sub, (b) performing its
obligations under the Loan Documents, Existing Senior Notes and Existing
Senior Note Indentures and under the Additional Notes and any agreements
governing such Additional Notes, (c) activities associated with the
maintenance of its corporate existence and with respect to the payment of
consolidated tax liabilities of Company and its Subsidiaries and (c) the
making of Restricted Junior Payments to the extent permitted under subsection
6.5. From and after the Closing Date, Finance Sub shall not engage in any
business or activities other than holding the stock of its Subsidiaries and
performing its obligations under the Loan Documents and shall have no assets
or liabilities other than those under the Loan Documents, Cash or Cash
Equivalents held in Collateral Accounts and the stock of its Subsidiaries.
From and after the Closing Date, no Subsidiary of Company shall be principally
engaged in a Telecommunications Business unless such Subsidiary is a direct or
indirect Wholly Owned Subsidiary of Finance Sub and no Subsidiary of Company
shall be formed or acquired to principally engage in the Telecommunications
Business unless such Subsidiary is a direct or indirect Wholly Owned
Subsidiary of Finance Sub.
6.15 AMENDMENTS OR WAIVERS OF CERTAIN RELATED AGREEMENTS.
Neither Company nor any of its Subsidiaries will agree to any
amendment to, or request any waiver of (other than a waiver for which no fee
is paid and no other concessions or considerations are granted by Company or
its Subsidiaries), or waive any of their respective rights under, any of the
Related Agreements (other than any amendment or waiver described in the next
succeeding sentence) without in each case obtaining the prior written consent
of Administrative Agent and Requisite Lenders to such amendment, request or
waiver and giving notice to Arranger. Notwithstanding the foregoing, Company
and its Subsidiaries may agree to amend or waive any provisions of the Related
Agreements (i) to cure any ambiguity, to correct or supplement any provision
therein which may be defective or inconsistent with any other provision
therein, or (ii) to comply with the Trust Indenture Act of 1939, as amended,
or (iii) to make modifications of a technical or clarifying nature or which
are no less favorable to the Lenders, in the reasonable opinion of
Administrative Agent and Requisite Lenders, than the provisions of the Related
Agreements as in effect on the Restatement Effective Date (for the purposes of
this subsection 6.15, any amendment, modification or change which would extend
the maturity or reduce the amount of any payment of principal on the Existing
Senior Notes or which would reduce the rate or extend the date for payment of
interest thereon, provided that no fee is payable in connection therewith,
shall be deemed to be an amendment, modification or change that is no less
favorable to the Lenders). Neither Company, Finance Sub nor any Restricted
Subsidiary shall agree to any amendment or any waiver of any of the
Intercompany Loan Documents without the prior written consent of Requisite
Lenders.
6.16 FISCAL YEAR
Borrowers shall not change their Fiscal Year-end from December 31.
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6.17 MASTER NOTE AND INTERCOMPANY PURCHASE MONEY NOTE.
Borrowers shall not permit at any time the aggregate principal amount
outstanding under the Master Note to differ from (i) the aggregate principal
amount of Series B Term Loans and Series C Term Loans outstanding or (ii) the
aggregate principal amount outstanding under the Intercompany Purchase Money
Note.
SECTION 7.
EVENTS OF DEFAULT
If any of the following conditions or events ("EVENTS OF DEFAULT")
shall occur:
7.1 FAILURE TO MAKE PAYMENTS WHEN DUE.
Failure by either Borrower to pay any installment of principal of any
Loan when due, whether at stated maturity, by acceleration, by notice of
voluntary prepayment, by mandatory prepayment or otherwise; or failure by
either Borrower to pay any interest on any Loan or any fee or any other amount
due under this Agreement within five days after the date due; or
7.2 DEFAULT IN OTHER AGREEMENTS.
(i) Failure of either Borrower or any of its
Subsidiaries to pay when due any principal of or interest on or any
other amount payable in respect of one or more items of Indebtedness
(other than Indebtedness referred to in subsection 7.1) or Contingent
Obligations in an individual principal amount of $2,000,000 or more
or with an aggregate principal amount of $5,000,000 or more, in each
case beyond the end of any grace period provided therefor; or (ii)
breach or default by either Borrower or any of its Subsidiaries with
respect to any other material term of (a) one or more items of
Indebtedness or Contingent Obligations in the individual or aggregate
principal amounts referred to in clause (i) above or (b) any loan
agreement, mortgage, indenture or other agreement relating to such
item(s) of Indebtedness or Contingent Obligation(s), if the effect of
such breach or default is to cause, or to permit the holder or
holders of that Indebtedness or Contingent Obligation(s) (or a
trustee on behalf of such holder or holders) to cause, that
Indebtedness or Contingent Obligation(s) to become or be declared due
and payable prior to its stated maturity or the stated maturity of
any underlying obligation, as the case may be (upon the giving or
receiving of notice, lapse of time, both, or otherwise); or
7.3 BREACH OF CERTAIN COVENANTS.
Failure of either Borrower to perform or comply with any term or
condition contained in subsections 2.5, 5.2 or 5.13 or Section 6 of this
Agreement; or
7.4 BREACH OF WARRANTY.
Any representation, warranty, certification or other statement made
by any Loan Party in any Loan Document or in any statement or certificate at
any time given by any Loan Party in writing pursuant hereto or thereto or in
connection herewith or therewith shall be false in any material respect on the
date as of which made; or
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7.5 OTHER DEFAULTS UNDER LOAN DOCUMENTS.
Any Loan Party shall default in the performance of or compliance with
any term contained in this Agreement or any of the other Loan Documents, other
than any such term referred to in any other subsection of this Section 7, and
such default shall not have been remedied or waived within 30 days after the
earlier of (i) an officer of such Loan Party becoming aware of such default or
(ii) receipt by Borrowers of notice from Administrative Agent or any Lender of
such default; or
7.6 INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) A court having jurisdiction in the premises shall
enter a decree or order for relief in respect of any Loan Party in an
involuntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in
effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or
(ii) an involuntary case shall be commenced against any Loan Party
under the Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect; or a decree or
order of a court having jurisdiction in the premises for the
appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over any Loan Party,
or over all or a substantial part of its property, shall have been
entered; or there shall have occurred the involuntary appointment of
an interim receiver, trustee or other custodian of any Loan Party for
all or a substantial part of its property; or a warrant of
attachment, execution or similar process shall have been issued
against any substantial part of the property of any Loan Party, and
any such event described in this clause (ii) shall continue for 60
days unless dismissed, bonded or discharged; or
7.7 VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) Any Loan Party shall have an order for relief
entered with respect to it or commence a voluntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency
or similar law now or hereafter in effect, or shall consent to the
entry of an order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case, under any such
law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of
its property; or any Loan Party shall make any assignment for the
benefit of creditors; or (ii) any Loan Party shall be unable, or
shall fail generally, or shall admit in writing its inability, to pay
its debts as such debts become due; or the Board of Directors of any
Loan Party (or any committee thereof) shall adopt any resolution or
otherwise authorize any action to approve any of the actions referred
to in clause (i) above or this clause (ii); or
7.8 JUDGMENTS AND ATTACHMENTS.
Any money judgment, writ or warrant of attachment or similar process
involving (i) in any individual case an amount in excess of $2,000,000 or (ii)
in the aggregate at any time an amount in excess of $5,000,000 (in either case
not adequately covered by insurance as to which a
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solvent and unaffiliated insurance company has acknowledged coverage) shall be
entered or filed against any Loan Party or any of their respective assets and
shall remain undischarged, unvacated, unbonded or unstayed for a period of 60
days (or in any event later than five days prior to the date of any proposed
sale thereunder); or
7.9 DISSOLUTION.
Any order, judgment or decree shall be entered against any Loan Party
decreeing the dissolution or split up of such Loan Party and such order shall
remain undischarged or unstayed for a period in excess of 30 days; or
7.10 EMPLOYEE BENEFIT PLANS.
There shall occur one or more ERISA Events which individually or in
the aggregate results in or would reasonably be expected to result in
liability of any Loan Party or any of their respective ERISA Affiliates in
excess of $2,000,000 during the term of this Agreement; or there shall exist
as of the most recently ended plan year an amount of unfunded benefit
liabilities (as defined in Section 4001(a)(18) of ERISA), individually or in
the aggregate for all Pension Plans (excluding for purposes of such
computation any Pension Plans with respect to which assets exceed benefit
liabilities), which exceeds $5,000,000 and which if required to be fully paid
could reasonably be expected to have a Material Adverse Effect; or
7.11 CHANGE IN CONTROL.
(i) Company shall cease to own 100% of the outstanding
Capital Stock of Finance Sub; (ii) any "Change of Control" shall
occur under the Existing Senior Note Indentures; or (iii) any
"Person" or "group" (within the meaning of Sections 13(d)(3) and
14(d)(2) of the Exchange Act or any successor provision to either of
the foregoing, including any group acting for the purpose of
acquiring, holding or disposing of securities within the meaning of
Rule 13d-5(b)(i) under the Exchange Act), other than any Permitted
Holder, becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act) of more than 35% of the total voting power of
all classes of the Voting Stock of Company and/or warrants or options
to acquire such Voting Stock, calculated on a fully diluted basis,
and such voting power percentage is greater than or equal to the
total voting power percentage then beneficially owned by the
Permitted Holders in the aggregate; or (iv) during any period of two
consecutive years, individuals who at the beginning of such period
constituted the board of directors of Company (together with any new
directors whose election or appointment by such board or whose
nomination for election by the shareholders of Company was approved
by a vote of a majority of the directors then still in office who
were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the board of directors
then in office; or
7.12 INVALIDITY OF SUBSIDIARY GUARANTY; FAILURE OF SECURITY; REPUDIATION
OF OBLIGATIONS.
At any time after the execution and delivery thereof, (i) the
Subsidiary Guaranty for any reason, other than the satisfaction in full of all
Obligations, shall cease to be in full force and effect (other than in
accordance with its terms) or shall be declared to be null and void, (ii) any
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Collateral Document or Intercompany Loan Document shall cease to be in full
force and effect (other than by reason of a release of Collateral thereunder
in accordance with the terms hereof or thereof, the satisfaction in full of
the Obligations or any other termination of such Collateral Document in
accordance with the terms hereof or thereof) or shall be declared null and
void, or Administrative Agent shall not have or shall cease to have a valid
and perfected First Priority Lien in any Collateral purported to be covered
thereby in each case for any reason other than the failure of Administrative
Agent or any Lender to take any action within its control, or (iii) any Loan
Party shall contest the validity or enforceability of any Loan Document or
Intercompany Loan Document in writing or deny in writing that it has any
further liability, including with respect to future advances by Lenders, under
any Loan Document to which it is a party; or
7.13 LICENSES.
Any of the following shall occur, the result of which would
reasonably be expected to have a Material Adverse Effect: (i) any material
License shall be cancelled, terminated, rescinded, revoked, suspended,
materially impaired or otherwise finally denied renewal, or shall cease to be
in full force and effect; (ii) any proceeding shall have been instituted by or
shall have been commenced before any court or any Communications Regulatory
Authority that would reasonably be expected to result in (a) cancellation,
termination, rescission, revocation, material impairment, suspension or denial
of renewal of a material License, or (b) a modification of a material License
in a material adverse respect or a renewal thereof on terms that materially
and adversely affect the economic or commercial value or usefulness thereof;
or (iii) any material Interconnection Agreement shall be terminated, reformed,
suspended or otherwise materially impaired, or shall be renegotiated and
renewed or replaced on terms that materially and adversely affect the economic
or commercial value or usefulness thereof, whether by action of the parties
thereto or by action of or under, modification to, or rescinding of the
Communications Act, State Law or any Regulations, in whole or in part; or
7.14 STOCKHOLDER AND NASDAQ APPROVALS.
The proxy statement relating to the Stockholder Approval for the
Committed Preferred shall not have been filed with the SEC within 15 days
after the Restatement Effective Date or the Stockholder Approval and any
required NASDAQ approval for the Committed Preferred shall not have been
obtained within 90 days after the Restatement Effective Date;
THEN (i) upon the occurrence of any Event of Default described in subsection
7.6 or 7.7, each of (a) the unpaid principal amount of and accrued interest on
the Loans and (b) all other Obligations shall automatically become immediately
due and payable, without presentment, demand, protest or other requirements of
any kind, all of which are hereby expressly waived by Borrowers and (ii) upon
the occurrence and during the continuation of any other Event of Default,
Administrative Agent shall, upon the request or with the consent of Requisite
Lenders, by written notice to Borrowers, (1) declare all or any portion of the
amounts described in clauses (a) and (b) above to be, and the same shall
forthwith become, immediately due and payable, and the obligation of each
Lender to make any Loan hereunder shall thereupon terminate and (2) subject to
the terms of the Loan Documents, take any and all other actions requested by
Requisite Lenders.
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Notwithstanding anything contained in the second preceding paragraph,
if at any time within 60 days after an acceleration of the Loans pursuant to
clause (ii) of such paragraph Borrowers shall pay all arrears of interest and
all payments on account of principal which shall have become due otherwise
than as a result of such acceleration (with interest on principal and, to the
extent permitted by law, on overdue interest, at the rates specified in this
Agreement) and all Events of Default and Potential Events of Default (other
than non-payment of the principal of and accrued interest on the Loans, in
each case which is due and payable solely by virtue of acceleration) shall be
remedied or waived pursuant to subsection 9.6, then Requisite Lenders, by
written notice to Borrowers, may at their option rescind and annul such
acceleration and its consequences; but such action shall not affect any
subsequent Event of Default or Potential Event of Default or impair any right
consequent thereon. The provisions of this paragraph are intended merely to
bind Lenders to a decision which may be made at the election of Requisite
Lenders and are not intended, directly or indirectly, to benefit Borrowers,
and such provisions shall not at any time be construed so as to grant
Borrowers the right to require Lenders to rescind or annul any acceleration
hereunder or to preclude Administrative Agent or Lenders from exercising any
of the rights or remedies available to them under any of the Loan Documents,
even if the conditions set forth in this paragraph are met.
SECTION 8.
AGENTS
8.1 APPOINTMENT.
(A) APPOINTMENT OF AGENTS. GSCP is hereby appointed Arranger and
Syndication Agent hereunder, and each Lender hereby authorizes Arranger and
Syndication Agent to act as its agent in accordance with the terms of this
Agreement and the other Loan Documents. BNY is hereby appointed Administrative
Agent hereunder and under the other Loan Documents and each Lender hereby
authorizes Administrative Agent to act as its agent in accordance with the
terms of this Agreement and the other Loan Documents. First Union National
Bank is hereby appointed Documentation Agent hereunder and CIT Lending
Services Corporation is hereby appointed Collateral Agent hereunder and each
Lender hereby authorizes Documentation Agent and Collateral Agent to act as
its agent in accordance with the terms of this Agreement and the other Loan
Documents. Each Agent hereby agrees to act upon the express conditions
contained in this Agreement and the other Loan Documents, as applicable. The
provisions of this Section 8 are solely for the benefit of Agents and Lenders
and Borrowers shall have no rights as a third party beneficiaries of any of
the provisions thereof. In performing its functions and duties under this
Agreement, each Agent shall act solely as an agent of Lenders and does not
assume and shall not be deemed to have assumed any obligation towards or
relationship of agency or trust with or for Borrowers or any of their
Subsidiaries. Each of Arranger and Syndication Agent, without consent of or
notice to any party hereto, may assign any and all of its rights or
obligations hereunder to any of its Affiliates. As of the Closing Date, all
obligations of Arranger, Syndication Agent, Documentation Agent and Collateral
Agent hereunder shall terminate other than the obligations of Syndication
Agent under subsection 2.1A(vi).
(B) APPOINTMENT OF SUPPLEMENTAL COLLATERAL AGENTS. It is the purpose
of this Agreement and the other Loan Documents that there shall be no
violation of any law of any jurisdiction denying or restricting the right of
banking corporations or associations to transact
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business as agent or trustee in such jurisdiction. It is recognized that in
case of litigation under this Agreement or any of the other Loan Documents,
and in particular in case of the enforcement of any of the Loan Documents, or
in case Administrative Agent deems that by reason of any present or future law
of any jurisdiction it may not exercise any of the rights, powers or remedies
granted herein or in any of the other Loan Documents or take any other action
which may be desirable or necessary in connection therewith, it may be
necessary that Administrative Agent appoint an additional individual or
institution as a separate trustee, co-trustee, collateral agent or collateral
co-agent (any such additional individual or institution being referred to
herein individually as a "SUPPLEMENTAL COLLATERAL AGENT" and collectively as
"SUPPLEMENTAL COLLATERAL AGENTS").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by
and vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise
such rights, powers and privileges with respect to such Collateral and to
perform such duties with respect to such Collateral, and every covenant and
obligation contained in the Loan Documents and necessary to the exercise or
performance thereof by such Supplemental Collateral Agent shall run to and be
enforceable by either Agent or such Supplemental Collateral Agent, and (ii)
the provisions of this Section 8 and of subsections 9.2 and 9.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental
Collateral Agent and all references therein to Administrative Agent shall be
deemed to be references to Administrative Agent and/or such Supplemental
Collateral Agent, as the context may require.
Should any instrument in writing from Company or any other Loan Party
be required by any Supplemental Collateral Agent so appointed by
Administrative Agent for more fully and certainly vesting in and confirming to
him or it such rights, powers, privileges and duties, Company shall, or shall
cause such Loan Party to, execute, acknowledge and deliver any and all such
instruments promptly upon request by Administrative Agent. In case any
Supplemental Collateral Agent, or a successor thereto, shall die, become
incapable of acting, resign or be removed, all the rights, powers, privileges
and duties of such Supplemental Collateral Agent, to the extent permitted by
law, shall vest in and be exercised by Administrative Agent until the
appointment of a new Supplemental Collateral Agent.
8.2 POWERS AND DUTIES; GENERAL IMMUNITY.
(A) POWERS; DUTIES SPECIFIED. Each Lender irrevocably authorizes each
Agent to take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Loan Documents as are
specifically delegated or granted to such Agent by the terms hereof and
thereof, together with such powers, rights and remedies as are reasonably
incidental thereto. Each Agent shall have only those duties and
responsibilities that are expressly specified in this Agreement and the other
Loan Documents. Each Agent may exercise such powers, rights and remedies and
perform such duties by or through its agents or employees. No Agent shall
have, by reason of this Agreement or any of the other Loan Documents, a
fiduciary relationship in respect of any Lender; and nothing in this Agreement
or any of the other Loan
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Documents, expressed or implied, is intended to or shall be so construed as to
impose upon any Agent any obligations in respect of this Agreement or any of
the other Loan Documents except as expressly set forth herein or therein.
(B) NO RESPONSIBILITY FOR CERTAIN MATTERS. No Agent shall be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or
any other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by any of Agent to Lenders or by or on
behalf of either Borrower to any Agent or any Lender in connection with the
Loan Documents and the transactions contemplated thereby or for the financial
condition or business affairs of either Borrower or any other Person liable
for the payment of any Obligations, nor shall any Agent be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained in any of the Loan
Documents or as to the use of the proceeds of the Loans or as to the existence
or possible existence of any Event of Default or Potential Event of Default.
Anything contained in this Agreement to the contrary notwithstanding,
Administrative Agent shall not have any liability arising from confirmations
of the amount of outstanding Loans or the component amounts thereof.
(C) EXCULPATORY PROVISIONS. None of Agents nor any of their
respective officers, partners, directors, employees or agents shall be liable
to Lenders for any action taken or omitted by any Agent under or in connection
with any of the Loan Documents except to the extent caused by such Agent's
gross negligence or willful misconduct. Each Agent shall be entitled to
refrain from any act or the taking of any action (including the failure to
take an action) in connection with this Agreement or any of the other Loan
Documents or from the exercise of any power, discretion or authority vested in
it hereunder or thereunder unless and until such Agent shall have received
instructions in respect thereof from Requisite Lenders (or such other Lenders
as may be required to give such instructions under subsection 9.6) and, upon
receipt of such instructions from Requisite Lenders (or such other Lenders, as
the case may be), such Agent shall be entitled to act or (where so instructed)
refrain from acting, or to exercise such power, discretion or authority, in
accordance with such instructions. Without prejudice to the generality of the
foregoing, (i) each Agent shall be entitled to rely, and shall be fully
protected in relying, upon any communication, instrument or document believed
by it to be genuine and correct and to have been signed or sent by the proper
person or persons, and shall be entitled to rely and shall be protected in
relying on opinions and judgments of attorneys (who may be attorneys for
Borrowers and their Subsidiaries), accountants, experts and other professional
advisors selected by it; and (ii) no Lender shall have any right of action
whatsoever against any Agent as a result of such Agent acting or (where so
instructed) refraining from acting under this Agreement or any of the other
Loan Documents in accordance with the instructions of Requisite Lenders (or
such other Lenders as may be required to give such instructions under
subsection 9.6).
(D) AGENT ENTITLED TO ACT AS LENDER. The agency hereby created shall
in no way impair or affect any of the rights and powers of, or impose any
duties or obligations upon, any Agent in its individual capacity as a Lender
hereunder. With respect to its participation in the Loans and the Letters of
Credit, each Agent shall have the same rights and powers hereunder as any
other Lender and may exercise the same as though it were not performing the
duties and functions
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delegated to it hereunder, and the term "Lender" or "Lenders" or any similar
term shall, unless the context clearly otherwise indicates, include each Agent
in its individual capacity. Any Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Company or any of its Affiliates as
if it were not performing the duties specified herein, and may accept fees and
other consideration from Borrowers for services in connection with this
Agreement and otherwise without having to account for the same to Lenders.
8.3 REPRESENTATIONS AND WARRANTIES; NO RESPONSIBILITY FOR APPRAISAL OF
CREDITWORTHINESS.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of the Loan
Parties in connection with the making of the Loans hereunder and that it has
made and shall continue to make its own appraisal of the creditworthiness of
the Loan Parties. No Agent shall have any duty or responsibility, either
initially or on a continuing basis, to make any such investigation or any such
appraisal on behalf of Lenders or to provide any Lender with any credit or
other information with respect thereto, whether coming into its possession
before the making of the Loans or at any time or times thereafter, and no
Agent shall have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
8.4 RIGHT TO INDEMNITY.
Each Lender, in proportion to its Pro Rata Share, severally agrees to
indemnify each Agent, to the extent that such Agent shall not have been
reimbursed by Borrowers, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against
such Agent in exercising its powers, rights and remedies or performing its
duties hereunder or under the other Loan Documents or otherwise in its
capacity as such Agent in any way relating to or arising out of this Agreement
or the other Loan Documents; provided that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such Agent's
gross negligence or willful misconduct. If any indemnity furnished to any
Agent for any purpose shall, in the opinion of such Agent, be insufficient or
become impaired, such Agent may call for additional indemnity and cease, or
not commence, to do the acts indemnified against until such additional
indemnity is furnished.
8.5 SUCCESSOR ADMINISTRATIVE AGENT.
(A) SUCCESSOR ADMINISTRATIVE AGENT. Administrative Agent may resign
at any time by giving 30 days' prior written notice thereof to Lenders and
Borrowers, and Administrative Agent may be removed at any time with or without
cause by an instrument or concurrent instruments in writing delivered to
Borrowers and Administrative Agent and signed by Requisite Lenders. Upon any
such notice of resignation or any such removal, Requisite Lenders shall have
the right, upon five Business Days' notice to Borrowers, to appoint a
successor Administrative Agent, which successor Administrative Agent shall,
unless an Event of Default shall have occurred and be continuing, be subject
to approval of Borrowers (such approval not to be unreasonably
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withheld or delayed). Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, that successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed
Administrative Agent and the retiring or removed Administrative Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Administrative Agent's resignation or removal hereunder as
Administrative Agent, the provisions of this Section 8 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.
(B) INTENTIONALLY OMITTED.
8.6 COLLATERAL DOCUMENTS AND GUARANTIES.
Each Lender hereby further authorizes Administrative Agent, on behalf
of and for the benefit of Lenders, to enter into each Collateral Document as
secured party and to be the agent for and representative of Lenders under the
Subsidiary Guaranty, and each Lender agrees to be bound by the terms of each
Collateral Document and the Subsidiary Guaranty; provided that Administrative
Agent shall not (i) enter into or consent to any material amendment,
modification, termination or waiver of any provision contained in any
Collateral Document or the Subsidiary Guaranty or (ii) release any Collateral
(except as otherwise expressly permitted or required pursuant to the terms of
this Agreement or the applicable Collateral Document), in each case without
the prior consent of Requisite Lenders (or, if required pursuant to subsection
9.6, all Lenders); provided further, however, that, without further written
consent or authorization from Lenders, Administrative Agent shall, in
accordance with the terms of this subsection 8.6 and the Loan Documents,
execute any documents or instruments necessary to (a) release any Lien
encumbering any item of Collateral that is the subject of a sale or other
disposition of assets permitted by this Agreement or to which Requisite
Lenders have otherwise consented or (b) release any Subsidiary Guarantor from
the Subsidiary Guaranty if all of the Capital Stock of such Subsidiary
Guarantor is sold to any Person (other than an Affiliate of Company) pursuant
to a sale or other disposition permitted hereunder or to which Requisite
Lenders have otherwise consented. In the event Collateral is sold in an Asset
Sale permitted hereunder or otherwise consented to by Requisite Lenders,
Administrative Agent shall, without further consent or authorization from
Lenders, release the Liens granted under the Collateral Documents on the
Collateral that is the subject of such Asset Sale concurrently with the
consummation of such Asset Sale; provided that Administrative Agent (and its
counsel) shall have received (i) not less than 5 Business Days' prior to the
consummation of such Asset Sale from Company unless a shorter notice period is
agreed to by Administrative Agent, notice of such Asset Sale in the form of an
Officers' Certificate (1) certifying that no Event of Default or Potential
Event of Default shall have occurred and be continuing as of the date of such
release of Collateral, (2) setting forth a detailed description of the
Collateral subject to such Asset Sale, (3) certifying that such Asset Sale is
permitted under this Agreement and that all conditions precedent to such Asset
Sale under this Agreement have been met, (4) attaching UCC-3 release
statements correctly prepared in form and substance reasonably satisfactory to
Administrative Agent for execution by Administrative Agent to release the
Lenders' Lien on the Collateral subject to such Asset Sale and (5) attaching,
if applicable, in the case of an ACSI Network Sale, a true and correct copy of
the ACSI Escrow Agreement; (ii) upon consummation of such Asset Sale, written
notice of the consummation thereof; and (iii) in the case of an Asset Sale
other than an ACSI Asset Sale prior
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to or simultaneously with the consummation of such Asset Sale, Administrative
Agent shall have received the Officers' Certificate required pursuant to
subsection 2.4B(iii)(f) together with all Net Asset Sale Proceeds of such
Asset Sale, if any, then required to be applied to repay Secured Obligations
under this Agreement. Upon payment in full of all of the Obligations,
Administrative Agent shall release the Liens on such Collateral granted
pursuant to the Collateral Documents. Upon any release of Collateral pursuant
to the foregoing, Administrative Agent shall, at Borrowers' expense, execute
and deliver such documents (without recourse or representation or warranty) as
reasonably requested to evidence such release. Anything contained in any of
the Loan Documents to the contrary notwithstanding, Company, Administrative
Agent and each Lender hereby agree that (1) no Lender shall have any right
individually to realize upon any of the Collateral under any Collateral
Document or to enforce the Subsidiary Guaranty, it being understood and agreed
that all powers, rights and remedies under the Collateral Documents and the
Subsidiary Guaranty may be exercised solely by Administrative Agent for the
benefit of Lenders in accordance with the terms thereof, and (2) in the event
of a foreclosure by Administrative Agent on any of the Collateral pursuant to
a public or private sale, Administrative Agent or any Lender may be the
purchaser of any or all of such Collateral at any such sale and Administrative
Agent, as agent for and representative of Lenders (but not any Lender or
Lenders in its or their respective individual capacities unless Requisite
Lenders shall otherwise agree in writing) shall be entitled, for the purpose
of bidding and making settlement or payment of the purchase price for all or
any portion of the Collateral sold at any such public sale, to use and apply
any of the Obligations as a credit on account of the purchase price for any
Collateral payable by Administrative Agent at such sale.
SECTION 9.
MISCELLANEOUS
9.1 ASSIGNMENTS AND PARTICIPATIONS IN LOANS.
(A) GENERAL. Subject to subsection 9.1B, each Lender shall have the
right at any time to (i) sell, assign or transfer to any Eligible Assignee, or
(ii) sell participations to any Person in, all or any part of any Loan or
Loans made by it or any other interest herein or in any other Obligations owed
to it; provided that no such sale, assignment, transfer or participation
shall, without the consent of Borrowers, require Borrowers to file a
registration statement with the SEC or apply to qualify such sale, assignment,
transfer or participation under the securities laws of any state; provided
further that no such sale, assignment or transfer described in clause (i)
above shall be effective unless and until an Assignment Agreement effecting
such sale, assignment or transfer shall have been accepted by Administrative
Agent and recorded in the Register as provided in subsection 9.1B(ii). Except
as otherwise provided in this subsection 9.1, no Lender shall, as between
Borrowers and such Lender, be relieved of any of its obligations hereunder as
a result of any sale, assignment or transfer of, or any granting of
participations in, all or any part of its Loans, or the other Obligations owed
to such Lender.
(B) ASSIGNMENTS.
(i) Amounts and Terms of Assignments. Each Loan or
other Obligation may (a) be assigned in any amount to another Lender,
or to an Affiliate of the assigning Lender or another Lender, with
the giving of notice to Borrowers and Administrative
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Agent or (b) be assigned in an aggregate amount of not less than
$1,000,000 in the case of the Series A Revolving Loans and $1,000,000
in the case of the Series B Term Loans and the Series C Term Loans
(in each case, other than for assignments to other Lenders or
Affiliates of such Lender or other Lenders) (or such lesser amount as
shall constitute the aggregate amount of the Loans and other
Obligations of the assigning Lender) to any other Eligible Assignee
with the giving of notice to Borrowers and with the consent of
Company (except with respect to any assignment under the Loan Put
Agreement or upon the occurrence and during the continuance of an
Event of Default) and Administrative Agent (which consent of Company
and Administrative Agent shall not be unreasonably withheld or
delayed). To the extent of any such assignment in accordance with
either clause (a) or (b) above, the assigning Lender shall be
relieved of its obligations with respect to its Loans or other
Obligations or the portion thereof so assigned. The parties to each
such assignment shall execute and deliver to Administrative Agent,
for its acceptance and recording in the Register, an Assignment
Agreement, together with a processing and recordation fee of $3,500
with respect to assignments by any Lender (other than GSCP) to any
person and $500 with respect to assignments by or to GSCP, and such
forms, certificates or other evidence, if any, with respect to United
States federal income tax withholding matters as the assignee under
such Assignment Agreement may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a). Upon such
execution, delivery, acceptance and recordation, from and after the
effective date specified in such Assignment Agreement, (1) the
assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to
such Assignment Agreement, shall have the rights and obligations of a
Lender hereunder and (2) the assigning Lender thereunder shall, to
the extent that rights and obligations hereunder have been assigned
by it pursuant to such Assignment Agreement, relinquish its rights
(other than any rights which survive the termination of this
Agreement under subsection 9.8B) and be released from its obligations
under this Agreement (and, in the case of an Assignment Agreement
covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a
party hereto. If any such assignment occurs after the issuance of
any Notes hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as
practicable, surrender its applicable Notes to Administrative Agent
for cancellation, and thereupon, upon the request of the assignee
and/or the assigning Lender, new Notes shall be issued to the
assignee and/or to the assigning Lender, substantially in the form of
Exhibit IV, Exhibit V or Exhibit VI annexed hereto, as the case may
be, with appropriate insertions, to reflect the new Loans of the
assignee and/or the assigning Lender.
(ii) Acceptance by Administrative Agent; Recordation in
Register. Upon its receipt of an Assignment Agreement executed by an
assigning Lender and an assignee representing that it is an Eligible
Assignee, together with the processing and recordation fee referred
to in subsection 9.1B(i) and any forms, certificates or other
evidence with respect to United States federal income tax withholding
matters that such assignee may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a),
Administrative Agent shall, if Administrative Agent and Company have
consented to the assignment evidenced thereby (in each case to the
extent such consent is required pursuant to subsection 9.1B(i)), (a)
accept such Assignment Agreement by executing a
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counterpart thereof as provided therein (which acceptance shall
evidence any required consent of Administrative Agent to such
assignment), (b) record the information contained therein in the
Register, and (c) give prompt notice thereof to Company.
Administrative Agent shall maintain a copy of each Assignment
Agreement delivered to and accepted by it as provided in this
subsection 9.1B(ii).
(iii) Notwithstanding anything to the contrary set forth
in this subsection 9.1, any assignments of Loans made pursuant to the
Loan Put Agreement shall be permitted assignments hereunder.
(C) PARTICIPATIONS. The holder of any participation, other than an
Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit to take any action hereunder except action
directly affecting (i) the extension of the regularly scheduled maturity of
any portion of the principal amount of or interest on any Loan allocated to
such participation or (ii) a reduction of the principal amount of or the rate
of interest payable on any Loan allocated to such participation, and all
amounts payable by Company hereunder (including amounts payable to such Lender
pursuant to subsections 2.6D and 2.7) shall be determined as if such Lender
had not sold such participation. Company and each Lender hereby acknowledge
and agree that, solely for purposes of subsections 9.4 and 9.5, (a) any
participation will give rise to a direct obligation of Company to the
participant and (b) the participant shall be considered to be a "Lender".
(D) ASSIGNMENTS TO FEDERAL RESERVE BANKS. In addition to the
assignments and participations permitted under the foregoing provisions of
this subsection 9.1, any Lender may assign and pledge all or any portion of
its Loans, the other Obligations owed to such Lender, and its Notes (i) to any
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 or (ii) to a trustee in connection with a
Loan securitization transaction; provided that (i) no Lender shall, as between
Borrowers and such Lender, be relieved of any of its obligations hereunder as
a result of any such assignment and pledge and (ii) in no event shall any
Federal Reserve Bank be considered to be a "Lender" or be entitled to require
the assigning Lender to take or omit to take any action hereunder.
(E) INFORMATION. Each Lender may furnish any information concerning
the Loan Parties in the possession of that Lender from time to time to
assignees and participants (including prospective assignees and participants),
subject to subsection 9.18.
(F) REPRESENTATIONS OF LENDERS. Each Lender listed on the signature
pages hereof hereby represents and warrants (i) that it is an Eligible
Assignee described in clause (i) of the definition thereof; (ii) that it has
experience and expertise in the making of or investing in loans such as the
Loans; and (iii) that it will make its Loans for its own account in the
ordinary course of its business and without a view to distribution of such
Loans within the meaning of the Securities Act or the Exchange Act or other
federal securities laws (it being understood that, subject to the provisions
of this subsection 9.1, the disposition of such Loans or any interests therein
shall at all times remain within its exclusive control). Each Lender that
becomes a party hereto pursuant to an Assignment Agreement shall be deemed to
agree that the representations
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and warranties of such Lender contained in Section 2(c) of such Assignment
Agreement are incorporated herein by this reference.
9.2 EXPENSES.
Whether or not the transactions contemplated hereby shall be
consummated, Borrowers agree, jointly and severally, to pay promptly (i) all
the actual and reasonable costs and expenses of preparation of the Loan
Documents and any consents, amendments, waivers or other modifications
thereto; (ii) all the costs of furnishing all opinions by counsel for
Borrowers (including any opinions requested by Lenders as to any legal matters
arising hereunder) and of Borrowers' performance of and compliance with all
agreements and conditions on its part to be performed or complied with under
this Agreement and the other Loan Documents including with respect to
confirming compliance with environmental, insurance and solvency requirements;
(iii) the reasonable fees, expenses and disbursements of counsel to Arranger
and counsel to Administrative Agent (in each case including allocated costs of
internal counsel) in connection with the negotiation, preparation, execution
and administration of the Loan Documents and any consents, amendments, waivers
or other modifications thereto and any other documents or matters requested by
Borrowers; (iv) all the actual costs and reasonable expenses of creating and
perfecting Liens in favor of Administrative Agent on behalf of Lenders
pursuant to any Collateral Document, including filing and recording fees,
expenses and taxes, stamp or documentary taxes, search fees, title insurance
premiums, and reasonable fees, expenses and disbursements of counsel to
Arranger and counsel to Administrative Agent and of counsel providing any
opinions that Arranger, Administrative Agent or Requisite Lenders may request
in respect of the Collateral Documents or the Liens created pursuant thereto;
(v) all the actual costs and reasonable expenses and disbursements of any
auditors, accountants or appraisers and any environmental or other
consultants, advisors and agents employed or retained by Administrative Agent
or Arranger and its counsel; (vi) all the actual costs and reasonable expenses
disbursements of any consultants, advisors and agents employed or retained by
Administrative Agent and its counsel; (vii) all other actual and reasonable
costs and expenses incurred by Syndication Agent, Arranger or Administrative
Agent in connection with the syndication of the Loans and the negotiation,
preparation and execution of the Loan Documents and any consents, amendments,
waivers or other modifications thereto and the transactions contemplated
thereby; and (viii) after the occurrence of an Event of Default, all costs and
expenses, including reasonable attorneys' fees (including allocated costs of
internal counsel) and costs of settlement, incurred by Arranger,
Administrative Agent and Lenders in enforcing any Obligations of or in
collecting any payments due from any Loan Party hereunder or under the other
Loan Documents by reason of such Event of Default (including in connection
with the sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Subsidiary Guaranty) or in connection
with any refinancing or restructuring of the credit arrangements provided
under this Agreement in the nature of a "work-out" or pursuant to any
insolvency or bankruptcy proceedings. Agents and Lenders agree that as long as
no Event of Default or Potential Event of Default shall have occurred and be
continuing, they shall notify Borrowers of any consultants to be engaged and
discuss with Borrowers the consultant's proposed fees.
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9.3 INDEMNITY.
In addition to the payment of expenses pursuant to subsection 9.2,
whether or not the transactions contemplated hereby shall be consummated,
Borrowers agree, jointly and severally, to defend (subject to Indemnitees'
selection of counsel), indemnify, pay and hold harmless Agents and Lenders,
and the officers, partners, directors, employees, agents and affiliates of any
of Agents and Lenders (collectively called the "INDEMNITEES"), from and
against any and all Indemnified Liabilities (as hereinafter defined); provided
that neither Borrower shall have any obligation to any Indemnitee hereunder
with respect to any Indemnified Liabilities to the extent such Indemnified
Liabilities arise solely from the gross negligence or willful misconduct of
that Indemnitee as determined by a final, non-appealable judgment of a court
of competent jurisdiction.
As used herein, "INDEMNIFIED LIABILITIES" means, collectively, any
and all liabilities, obligations, losses, damages (including natural resource
damages), penalties, actions, judgments, suits, claims (including
Environmental Claims), costs (including the costs of any investigation, study,
sampling, testing, abatement, cleanup, removal, remediation or other response
action necessary to remove, remediate, clean up or abate any Hazardous
Materials Activity), expenses and disbursements of any kind or nature
whatsoever (including the reasonable fees and disbursements of counsel for
Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and
any fees or expenses incurred by Indemnitees in enforcing this indemnity),
whether direct, indirect or consequential and whether based on any federal,
state or foreign laws, statutes, rules or regulations (including securities
and commercial laws, statutes, rules or regulations and Environmental Laws),
on common law or equitable cause or on contract or otherwise, that may be
imposed on, incurred by, or asserted against any such Indemnitee, in any
manner relating to or arising out of (i) this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby (including
Lenders' agreement to make the Loans hereunder or the use or intended use of
the proceeds thereof, or any enforcement of any of the Loan Documents
(including any sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Subsidiary Guaranty)), (ii) the
statements contained in the commitment letter delivered by any Lender to
Company with respect thereto, or (iii) any Environmental Claim or any
Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, or
practice of Company or any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and
hold harmless set forth in this subsection 9.3 may be unenforceable in whole
or in part because they are violative of any law or public policy, Borrowers
shall contribute the maximum portion that it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all Indemnified
Liabilities incurred by Indemnitees or any of them.
9.4 SET-OFF; SECURITY INTEREST IN DEPOSIT ACCOUNTS.
In addition to any rights now or hereafter granted under applicable
law and not by way of limitation of any such rights, upon the occurrence of
any Event of Default each Lender is hereby authorized by Borrowers at any time
or from time to time, without notice to Borrowers or to any
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other Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special, including
Indebtedness evidenced by certificates of deposit, whether matured or
unmatured, but not including trust accounts) and any other Indebtedness at any
time held or owing by that Lender to or for the credit or the account of such
Borrower against and on account of the obligations and liabilities of such
Borrower to that Lender under this Agreement and the other Loan Documents,
including all claims of any nature or description arising out of or connected
with this Agreement or any other Loan Document, irrespective of whether or not
(i) that Lender shall have made any demand hereunder or (ii) the principal of
or the interest on the Loans or any other amounts due hereunder shall have
become due and payable pursuant to Section 7 and although said obligations and
liabilities, or any of them, may be contingent or unmatured. Borrowers hereby
further grant to Administrative Agent and each Lender a security interest in
all deposits and accounts maintained with Administrative Agent or such Lender
as security for the Obligations.
9.5 RATABLE SHARING.
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization
upon security, through the exercise of any right of set-off or banker's lien,
by counterclaim or cross action or by the enforcement of any right under the
Loan Documents or otherwise, or as adequate protection of a deposit treated as
cash collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, fees and other
amounts then due and owing to that Lender hereunder or under the other Loan
Documents (collectively, the "AGGREGATE AMOUNTS DUE" to such Lender) which is
greater than the proportion received by any other Lender in respect of the
Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (i) notify Administrative Agent and each
other Lender of the receipt of such payment and (ii) apply a portion of such
payment to purchase participations (which it shall be deemed to have purchased
from each seller of a participation simultaneously upon the receipt by such
seller of its portion of such payment) in the Aggregate Amounts Due to the
other Lenders so that all such recoveries of Aggregate Amounts Due shall be
shared by all Lenders in proportion to the Aggregate Amounts Due to them;
provided that if all or part of such proportionately greater payment received
by such purchasing Lender is thereafter recovered from such Lender upon the
bankruptcy or reorganization of either Borrower or otherwise, those purchases
shall be rescinded and the purchase prices paid for such participations shall
be returned to such purchasing Lender ratably to the extent of such recovery,
but without interest. Borrowers expressly consent to the foregoing arrangement
and agrees that any holder of a participation so purchased may exercise any
and all rights of banker's lien, set-off or counterclaim with respect to any
and all monies owing by Borrowers to that holder with respect thereto as fully
as if that holder were owed the amount of the participation held by that
holder.
9.6 AMENDMENTS AND WAIVERS.
No amendment, modification, termination or waiver of any provision of
the Loan Documents, or consent to any departure by Loan Parties therefrom,
shall in any event be effective without the written concurrence of Requisite
Lenders; provided that no such amendment, modification, termination, waiver or
consent shall, without the consent of each
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Lender (with Obligations directly affected in the case of the following clause
(i)): (i) extend the scheduled final maturity of any Loan or Note or waive,
reduce or postpone any scheduled repayments of the Loans pursuant to
subsection 2.4A or reduce the rate of interest on any Loan (other than any
waiver of any increase in the interest rate applicable to any Loan pursuant to
subsection 2.2E) or any commitment fees payable hereunder, or extend the time
for payment of any such interest or fees, or reduce the principal amount of
any Loan or (ii) amend, modify, terminate or waive any provision of subsection
2.4D(iii), subsection 9.5 or this subsection 9.6, (iii) reduce the percentage
specified in the definition of "Requisite Lenders", (iv) consent to the
assignment or transfer by either Borrower of any of its rights and obligations
under this Agreement or (v) release all or substantially all of the Collateral
or all or substantially all of the Subsidiary Guarantors from the Subsidiary
Guaranty except as expressly provided in the Loan Documents; provided, further
that no such amendment, modification, termination or waiver shall amend,
modify, terminate or waive any provision of Section 8 as the same applies to
any Agent, or any other provision of this Agreement as the same applies to the
rights or obligations of any Agent, in each case without the consent of such
Agent, and provided further that, subject to the agreement of the Lenders not
to take certain actions without the consent of the Huff Fund in Section 7 of
the Loan Put Agreement, neither the Huff Fund nor any Affiliate of the Huff
Fund shall have any voting rights under this subsection 9.6 or otherwise under
the Loan Documents in respect of the Assigned Loans (as defined in the Loan
Put Agreement) including in any bankruptcy proceedings. The immediately
preceding proviso shall terminate with respect to Loans that are duly assigned
pursuant to subsection 9.1 to a Person that is not an Affiliate of the Huff
Fund. Administrative Agent may, but shall have no obligation to, with the
concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent shall be effective
only in the specific instance and for the specific purpose for which it was
given. No notice to or demand on Borrowers in any case shall entitle Borrowers
to any other or further notice or demand in similar or other circumstances.
Any amendment, modification, termination, waiver or consent effected in
accordance with this subsection 9.6 shall be binding upon each Lender at the
time outstanding, each future Lender and, if signed by Borrowers, on
Borrowers.
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9.7 NOTICES.
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States
mail or courier service and shall be deemed to have been given when delivered
in person or by courier service, upon receipt of telefacsimile or telex, or
three Business Days after depositing it in the United States mail with postage
prepaid and properly addressed; provided that notices to Arranger, Syndication
Agent or Administrative Agent shall not be effective until received. For the
purposes hereof, the address of each party hereto shall be as set forth under
such party's name on the signature pages hereof or (i) as to Borrowers and
Administrative Agent, such other address as shall be designated by such Person
in a written notice delivered to the other parties hereto and (ii) as to each
other party, such other address as shall be designated by such party in a
written notice delivered to Administrative Agent.
9.8 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
(A) All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement.
(B) Notwithstanding anything in this Agreement or implied by law to
the contrary, the agreements of Borrowers set forth in subsections 2.6D, 2.7,
9.2, 9.3 and 9.4 and the agreements of Lenders set forth in subsections 8.2C,
8.4 and 9.5 shall survive the payment of the Loans and the termination of this
Agreement.
9.9 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of Administrative Agent or any Lender
in the exercise of any power, right or privilege hereunder or under any other
Loan Document shall impair such power, right or privilege or be construed to
be a waiver of any default or acquiescence therein, nor shall any single or
partial exercise of any such power, right or privilege preclude other or
further exercise thereof or of any other power, right or privilege. All rights
and remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise
available.
9.10 MARSHALLING; PAYMENTS SET ASIDE.
Neither Administrative Agent nor any Lender shall be under any
obligation to marshal any assets in favor of Company or any other party or
against or in payment of any or all of the Obligations. To the extent that
either Borrower makes a payment or payments to Administrative Agent or Lenders
(or to Administrative Agent for the benefit of Lenders), or Administrative
Agent or Lenders enforce any security interests or exercise their rights of
setoff, and such payment or payments or the proceeds of such enforcement or
setoff or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, any other state
or federal law, common law or any equitable cause, then, to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied,
and all Liens, rights and remedies
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therefor or related thereto, shall be revived and continued in full force and
effect as if such payment or payments had not been made or such enforcement or
setoff had not occurred.
9.11 SEVERABILITY.
In case any provision in or obligation under this Agreement or the
Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.
9.12 OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS.
The obligations of Lenders hereunder are several and no Lender shall
be responsible for the obligations of any other Lender hereunder. Nothing
contained herein or in any other Loan Document, and no action taken by Lenders
pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out of this Agreement and it shall not be necessary for any
other Lender to be joined as an additional party in any proceeding for such
purpose.
9.13 HEADINGS.
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
9.14 APPLICABLE LAW.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT
REGARD TO INCONSISTENT CONFLICTS OF LAWS PRINCIPLES.
9.15 SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the
parties hereto and the successors and assigns of Lenders (it being understood
that Lenders' rights of assignment are subject to subsection 9.1). Neither
Borrowers' rights or obligations hereunder nor any interest therein may be
assigned or delegated by Borrowers without the prior written consent of all
Lenders.
9.16 CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST EITHER BORROWER ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
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DOCUMENT, OR ANY OBLIGATIONS THEREUNDER, MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW
YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH BORROWER, FOR ITSELF
AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO COMPANY AT ITS ADDRESS PROVIDED
IN ACCORDANCE WITH SUBSECTION 9.7; (IV) AGREES THAT SERVICE AS PROVIDED IN
CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER SUCH
BORROWER IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; (V) AGREES THAT LENDERS RETAIN
THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING
PROCEEDINGS AGAINST SUCH BORROWER IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 9.16 RELATING TO
JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST EXTENT
PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402 OR
OTHERWISE.
9.17 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION
OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of
this waiver is intended to be all-encompassing of any and all disputes that
may be filed in any court and that relate to the subject matter of this
transaction, including contract claims, tort claims, breach of duty claims and
all other common law and statutory claims. Each party hereto acknowledges that
this waiver is a material inducement to enter into a business relationship,
that each has already relied on this waiver in entering into this Agreement,
and that each will continue to rely on this waiver in their related future
dealings. Each party hereto further warrants and represents that it has
reviewed this waiver with its legal counsel and that it knowingly and
voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SUBSECTION 9.17 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
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9.18 CONFIDENTIALITY.
Each Lender shall hold all non-public information obtained pursuant
to the requirements of this Agreement which has been identified as
confidential by Borrowers in accordance with such Lender's customary
procedures for handling confidential information of this nature and in
accordance with prudent lending or investing practices, it being understood
and agreed by Borrowers that in any event a Lender may make disclosures to
Affiliates of such Lender or disclosures reasonably required by any bona fide
assignee, transferee or participant in connection with the contemplated
assignment or transfer by such Lender of any Loans or any participations
therein (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such information and will have
agreed to keep such information confidential) or disclosures required by any
governmental agency or representative thereof or by the National Association
of Insurance Commissioners or pursuant to legal process; provided that, unless
specifically prohibited by applicable law or court order, each Lender shall
notify Borrowers of any request by any governmental agency or representative
thereof (other than any such request in connection with any examination of the
financial condition of such Lender by such governmental agency) for disclosure
of any such non-public information prior to disclosure of such information;
and provided, further that in no event shall any Lender be obligated or
required to return any materials furnished by Company or any of its
Subsidiaries.
9.19 MAXIMUM AMOUNT.
(A) It is the intention of Borrowers and Lenders to conform strictly
to the usury and similar laws relating to interest from time to time in force,
and all agreements between Borrowers, Administrative Agent and Lenders,
whether now existing or hereafter arising and whether oral or written, are
hereby expressly limited so that in no contingency or event whatsoever,
whether by acceleration of maturity hereof or otherwise, shall the amount paid
or agreed to be paid in the aggregate to Lenders or to Administrative Agent on
behalf of Lenders as interest hereunder or under the other Loan Documents or
in any other security agreement given to secure the Obligations, or in any
other document evidencing, securing or pertaining to the indebtedness
evidenced hereby or thereby, exceed the maximum amount permissible under
applicable usury or such other laws (the "MAXIMUM AMOUNT"). If under any
circumstances whatsoever fulfillment of any provision hereof, or of any of the
other Loan Documents, at the time performance of such provision shall be due,
shall involve exceeding the Maximum Amount, then, ipso facto, the obligation
to be fulfilled shall be reduced to the Maximum Amount. For the purposes of
calculating the actual amount of interest paid and/or payable hereunder in
respect of laws pertaining to usury or such other laws, all sums paid or
agreed to be paid to Lenders for the use, forbearance or detention of the
indebtedness of Company evidenced hereby, outstanding from time to time shall,
to the extent permitted by applicable law, be amortized, pro rated, allocated
and spread from the date of disbursement of the proceeds of the Loans until
payment in full of all of such indebtedness, so that the actual rate of
interest on account of such indebtedness is uniform throughout the term
hereof. The terms and provisions of this subsection shall control and
supersede every other provision of all agreements between Company,
Administrative Agent and Lenders.
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(B) If under any circumstances Lenders shall receive an amount which
would exceed the Maximum Amount, such amount shall be deemed a payment in
reduction of the principal amount of the Loans and shall be treated as a
voluntary prepayment under subsection 2.4B(i), and shall be so applied in
accordance with subsection 2.4B(iv) hereof, or if such amount exceeds the
unpaid balance of the Loans and any other indebtedness of Company in favor of
Lenders, the excess shall be deemed to have been a payment made by mistake and
shall be refunded to Company.
9.20 ENTIRE AGREEMENT.
This Agreement, together with the other Loan Documents and other
documents delivered pursuant hereto and thereto, represent the entire
agreement among the parties hereto with respect to the subject matter hereof
and supersede all prior agreements and understandings of the parties relating
to the subject matter hereof.
9.21 COUNTERPARTS; EFFECTIVENESS.
This Agreement and any amendments, waivers, consents or supplements
hereto or in connection herewith may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when
so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are physically
attached to the same document. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto and receipt by
Company and Administrative Agent of written or telephonic notification of such
execution and authorization of delivery thereof.
9.22 ACKNOWLEDGMENT AND CONSENT.
Each Loan Party hereby acknowledges that it has reviewed the terms
and provisions of this Agreement. Each Loan Party hereby confirms that each
Loan Document to which it is a party or otherwise bound and all Collateral
encumbered thereby will continue to guaranty or secure, as the case may be, to
the fullest extent possible the payment and performance of all "Guarantied
Obligations" and "Secured Obligations" as the case may be (in each case as
such terms are defined in the applicable Loan Document), including without
limitation the payment and performance of all such "Guarantied Obligations" or
"Secured Obligations," as the case may be, in respect of the Obligations of
Borrowers now or hereafter existing under or in respect of this Agreement.
Each Loan Party acknowledges and agrees that any of the Loan Documents entered
with respect to the Original Credit Agreement and to which it is a party or
otherwise bound shall continue in full force and effect and that all of its
obligations thereunder shall be valid and enforceable and shall not be
impaired or limited by the execution or effectiveness of this Agreement,
except with respect to the Original Credit Agreement, to the extent expressly
modified by this Agreement. Each Loan Party (other than Borrowers)
acknowledges and agrees that (i) notwithstanding the conditions to
effectiveness set forth in this Loan Party is not required by the terms of the
Original Credit Agreement or any other Loan Document to consent to this
Agreement and (ii) nothing in this Agreement or any other Loan Document shall
be deemed to
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require the consent of such Loan Party to any future amendments, consents or
waivers to this Agreement.
Each of the Loan Parties hereby, to the fullest extent permitted by
applicable law, acknowledges and confirms that it does not have any grounds
and hereby agrees not to challenge (or to allege or to pursue any matter,
cause or claim arising under or with respect to) the Original Credit
Agreement, this Agreement or any of the other Loan Documents, any of the terms
or conditions thereof or thereunder, or the status of any thereof as legal,
valid and binding obligations enforceable in accordance with their respective
terms; and it does not possess (and hereby forever waives, remises, releases,
discharges and holds harmless the Lenders and the Agents, and their respective
affiliates, stockholders, directors, officers, employees, attorneys, agents
and representatives and each of their respective heirs, executors,
administrators, successors and assigns (collectively, the "INDEMNIFIED
PARTIES") from and against, and agrees not to allege or pursue) any action,
cause of action, suit, debt, claim, counterclaim, cross-claim, demand,
defense, offset, opposition, demand and other right of action whatsoever,
whether in law, equity or otherwise (which it, all those claiming by, through
or under it, or its successors or assigns, have or may have) against the
Indemnified Parties, or any of them, prior to or as of the Restatement
Effective Date for, upon, or by reason of, any matter, cause or thing
whatsoever, arising out of, or relating to the Original Credit Agreement, this
Agreement or any of the other Loan Documents (including, without limitation,
any payment, performance, validity or enforceability of any or all of the
terms or conditions thereof or thereunder) or any transaction relating to any
of the foregoing, or any or all actions, courses of conduct or other matters
in any manner whatsoever relating to or otherwise connected with any of the
foregoing.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWERS:
e.spire COMMUNICATIONS, INC.
By:
----------------------------------
Title:
---------------------------
e.spire FINANCE CORPORATION
By:
----------------------------------
Title:
---------------------------
LENDERS:
GOLDMAN SACHS CREDIT PARTNERS
L.P., individually, as Arranger and as
Syndication Agent
By:
----------------------------------
Title:
---------------------------
THE BANK OF NEW YORK, individually and as
Administrative Agent
By:
----------------------------------
Title:
---------------------------
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FIRST UNION NATIONAL BANK, individually
and as Documentation Agent
By:
----------------------------------
Title:
---------------------------
CIT LENDING SERVICES CORPORATION
(f/k/a Newcourt Commercial Finance
Corporation), an affiliate of The CIT Group,
Inc., individually and as Collateral Agent
By:
----------------------------------
Title:
---------------------------
BANKERS LIFE AND CASUALTY COMPANY
By:
----------------------------------
Title:
---------------------------
CONSECO ANNUITY ASSURANCE COMPANY
By:
----------------------------------
Title:
---------------------------
DEUTSCHE BANK AG NEW YORK BRANCH
By:
----------------------------------
Title:
---------------------------
By:
----------------------------------
Title:
---------------------------
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<PAGE> 124
FOOTHILL CAPITAL CORPORATION
By:
----------------------------------
Title:
---------------------------
FRANKLIN FLOATING RATE TRUST
By:
----------------------------------
Title:
---------------------------
MERRILL LYNCH GLOBAL
INVESTMENT SERIES INCOME
STRATEGIES PORTFOLIO
By: Merrill Lynch Investment Managers,
L.P., as Investment Advisor
By:
--------------------------------
Title:
---------------------------
MERRILL LYNCH SENIOR FLOATING
RATE FUND INC.
By:
--------------------------------
Title:
---------------------------
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<PAGE> 125
FOR PURPOSES OF SECTION 9.22 ONLY:
SUBSIDIARY GUARANTORS:
e.spire LEASING CORPORATION
e.spireDATA, INC.
ACSI LOCAL SWITCHED SERVICES, INC.
ACSI LOCAL SWITCHED SERVICES OF VIRGINIA, INC.
ACSI LONG DISTANCE, INC.
ACSI NETWORK TECHNOLOGIES, INC.
AMERICAN COMMUNICATION SERVICES OF ALBUQUERQUE, INC.
AMERICAN COMMUNICATION SERVICES OF AMARILLO, INC.
AMERICAN COMMUNICATION SERVICES OF ATLANTA, INC.
AMERICAN COMMUNICATION SERVICES OF AUSTIN, INC.
AMERICAN COMMUNICATION SERVICES OF BATON ROUGE, INC.
AMERICAN COMMUNICATION SERVICES OF BIRMINGHAM, INC.
AMERICAN COMMUNICATION SERVICES OF BOISE, INC.
AMERICAN COMMUNICATION SERVICES OF CHARLESTON, INC.
AMERICAN COMMUNICATION SERVICES OF CHATTANOOGA, INC.
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AMERICAN COMMUNICATION SERVICES OF COLORADO
SPRINGS, INC.
AMERICAN COMMUNICATION SERVICES OF COLUMBIA, INC.
AMERICAN COMMUNICATION SERVICES OF COLUMBUS, INC.
AMERICAN COMMUNICATION SERVICES OF CORPUS CHRISTI,
INC.
AMERICAN COMMUNICATION SERVICES OF DALLAS, INC.
AMERICAN COMMUNICATION SERVICES OF D.C., INC.
AMERICAN COMMUNICATION SERVICES OF EL PASO, INC.
AMERICAN COMMUNICATION SERVICES OF FORT WORTH, INC.
AMERICAN COMMUNICATION SERVICES OF GREENVILLE, INC.
AMERICAN COMMUNICATION SERVICES OF HUNTSVILLE, INC.
AMERICAN COMMUNICATION SERVICES OF IRVING, INC.
AMERICAN COMMUNICATION SERVICES OF JACKSON, INC.
AMERICAN COMMUNICATION SERVICES OF JACKSONVILLE,
INC.
AMERICAN COMMUNICATION SERVICES OF KANSAS CITY, INC.
AMERICAN COMMUNICATION SERVICES OF LAS VEGAS, INC.
AMERICAN COMMUNICATION SERVICES OF LEXINGTON, INC.
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AMERICAN COMMUNICATION SERVICES OF LITTLE ROCK, INC.
AMERICAN COMMUNICATION SERVICES, OF LOUISIANA, INC.
AMERICAN COMMUNICATION SERVICES OF LOUISVILLE, INC.
AMERICAN COMMUNICATION SERVICES OF LUBBOCK, INC.
AMERICAN COMMUNICATION SERVICES OF MARYLAND, INC.
AMERICAN COMMUNICATION SERVICES OF MIAMI, INC.
AMERICAN COMMUNICATION SERVICES OF MOBILE, INC.
AMERICAN COMMUNICATION SERVICES OF MONTGOMERY, INC.
AMERICAN COMMUNICATION SERVICES OF PIMA COUNTY, INC.
AMERICAN COMMUNICATION SERVICES OF RIO RANCHO, INC.
AMERICAN COMMUNICATION SERVICES OF ROANOKE, INC.
AMERICAN COMMUNICATION SERVICES OF SAN ANTONIO, INC.
AMERICAN COMMUNICATION SERVICES OF SAVANNAH, INC.
AMERICAN COMMUNICATION SERVICES OF SHREVEPORT, INC.
AMERICAN COMMUNICATION SERVICES OF SPARTANBURG, INC.
AMERICAN COMMUNICATION SERVICES OF TAMPA, INC.
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<PAGE> 128
AMERICAN COMMUNICATION SERVICES OF TULSA, INC.
AMERICAN COMMUNICATION SERVICES OF VIRGINIA, INC.
AMERICAN COMMUNICATION SERVICES OF WILMINGTON, INC.
AMERICAN COMMUNICATIONS SERVICES INTERNATIONAL, INC.
CYBERGATE, INC.
FLORIDANET, INC.
Each by:
----------------------------------------
Name:
Title: Authorized Signatory of each of the
foregoing Subsidiary Guarantors
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