[EXECUTION COPY]
EXHIBIT 10.28
U.S. $750,000,000
CREDIT AGREEMENT,
dated as of
December 31, 1996,
among
TCI SATELLITE ENTERTAINMENT, INC.,
as the Borrower,
THE BANK OF NOVA SCOTIA,
as the Administrative Agent,
NATIONSBANK OF TEXAS, N.A.,
as the Syndication Agent,
CREDIT LYONNAIS NEW YORK BRANCH,
as the Documentation Agent,
VARIOUS FINANCIAL INSTITUTIONS,
as the Lenders,
and
THE BANK OF NOVA SCOTIA,
CREDIT LYONNAIS NEW YORK BRANCH
and
NATIONSBANK OF TEXAS, N.A.,
as the Arranging Agents.
TABLE OF CONTENTS
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Section Page
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms................................................... 2
1.2. Use of Defined Terms............................................ 37
1.3. Cross-References................................................ 37
1.4. Accounting and Financial Determinations......................... 37
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
2.1. Commitments..................................................... 38
2.1.1. Commitment of Each Lender....................................... 38
2.1.2. Letter of Credit Commitment..................................... 38
2.1.3. Commitment Amount Availability.................................. 39
2.1.4. Lenders Not Permitted or Required to Make Loans................. 39
2.1.5. Issuer Not Permitted or Required to Issue Letters
of Credit..................................................... 39
2.2. Reduction of the Commitment Amounts............................. 39
2.2.1. Optional........................................................ 39
2.2.2. Mandatory....................................................... 39
2.3. Borrowing Procedures............................................ 41
2.4. Continuation and Conversion Elections........................... 41
2.5. Funding......................................................... 42
2.6. Issuance Procedures............................................. 42
2.6.1. Other Lenders' Participation.................................... 42
2.6.2. Disbursements................................................... 43
2.6.3. Reimbursement................................................... 43
2.6.4. Deemed Disbursements............................................ 44
2.6.5. Nature of Reimbursement Obligations............................. 44
2.7. Notes........................................................... 45
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments...................................... 46
3.2. Interest Provisions............................................. 47
3.2.1. Rates........................................................... 47
3.2.2. Post-Maturity Rates............................................. 47
3.2.3. Payment Dates................................................... 48
3.3. Fees............................................................ 48
3.3.1. Commitment Fee.................................................. 48
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3.3.2. Agency Fees..................................................... 49
3.3.3. Letter of Credit Fee............................................ 49
ARTICLE IV
CERTAIN CD RATE, LIBO RATE AND OTHER PROVISIONS
4.1. Fixed Rate Lending Unlawful..................................... 49
4.2. Deposits Unavailable............................................ 50
4.3. Increased Fixed Rate Loan Costs, etc............................ 50
4.4. Funding Losses.................................................. 50
4.5. Increased Capital Costs......................................... 51
4.6. Taxes........................................................... 52
4.7. Payments, Computations, etc..................................... 54
4.8. Sharing of Payments............................................. 55
4.9. Setoff.......................................................... 56
4.10. Lender's Duty to Mitigate....................................... 56
4.11. Replacement of Lenders.......................................... 57
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
5.1. Initial Credit Extension........................................ 58
5.1.1. Resolutions, etc................................................ 58
5.1.2. Delivery of Notes............................................... 58
5.1.3. Delivery of Certain Documents................................... 59
5.1.4. Payment of Outstanding Indebtedness, etc........................ 59
5.1.5. Borrower Pledge Agreement....................................... 59
5.1.6. Security Agreements............................................. 60
5.1.7. Patent Security Agreements, Copyright Security
Agreements and Trademark Security Agreements.................. 61
5.1.8. Concentration Account Agreement................................. 61
5.1.9. Other Loan Documents............................................ 61
5.1.10. Subsidiary Guaranties........................................... 61
5.1.11. Financial Information, etc...................................... 61
5.1.12. Closing Date Certificate........................................ 62
5.1.13. Compliance Certificate.......................................... 62
5.1.14. Solvency, etc................................................... 62
5.1.15. Insurance....................................................... 62
5.1.16. Opinions of Counsel............................................. 62
5.1.17. Closing Fees, Expenses, etc..................................... 62
5.2. All Credit Extensions........................................... 62
5.2.1. Compliance with Warranties, No Default, etc..................... 63
5.2.2. Credit Extension Request, etc................................... 63
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5.2.3. Satisfactory Legal Form......................................... 63
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc............................................... 64
6.2. Due Authorization, Non-Contravention, etc....................... 64
6.3. Government Approval, Regulation, etc............................ 65
6.4. Validity, etc................................................... 65
6.5. Financial Information........................................... 65
6.6. No Material Adverse Effect...................................... 66
6.7. Litigation, Labor Controversies, etc............................ 66
6.8. Compliance with Laws............................................ 66
6.9. Subsidiaries.................................................... 66
6.10. Ownership of Properties......................................... 66
6.11. Taxes........................................................... 66
6.12. Pension and Welfare Plans....................................... 67
6.13. Environmental Warranties........................................ 67
6.14. Intellectual Property........................................... 68
6.15. Regulations G, U and X.......................................... 69
6.16. Accuracy of Information......................................... 69
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants........................................... 69
7.1.1. Financial Information, Reports, Notices, etc.................... 69
7.1.2. Compliance with Laws, etc....................................... 72
7.1.3. Maintenance of Properties....................................... 72
7.1.4. Insurance....................................................... 72
7.1.5. Books and Records............................................... 73
7.1.6. Environmental Covenant.......................................... 73
7.1.7. Future Subsidiaries............................................. 74
7.1.8. Additional Collateral........................................... 75
7.1.9. Rate Protection Agreements...................................... 75
7.1.10. Future Leased Property.......................................... 76
7.1.11. Use of Proceeds................................................. 76
7.1.12. TCIC Credit Agreement........................................... 76
7.2. Negative Covenants.............................................. 77
7.2.1. Business Activities............................................. 77
7.2.2. Indebtedness.................................................... 77
7.2.3. Liens........................................................... 78
7.2.4. Financial Condition and Operations.............................. 80
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7.2.5. Investments..................................................... 82
7.2.6. Restricted Payments, etc........................................ 83
7.2.7. Capital Expenditures, etc....................................... 84
7.2.8. Subsidiaries.................................................... 84
7.2.9. Take or Pay Contracts........................................... 84
7.2.10. Consolidation, Merger, etc...................................... 84
7.2.11. Permitted Dispositions.......................................... 85
7.2.12. Modification of Certain Agreements.............................. 85
7.2.13. Transactions with Affiliates.................................... 85
7.2.14. Negative Pledges, Restrictive Agreements, etc................... 86
7.2.15. Sale and Leaseback.............................................. 86
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default.................................... 87
8.1.1. Non-Payment of Obligations...................................... 87
8.1.2. Breach of Warranty.............................................. 87
8.1.3. Non-Performance of Certain Covenants and
Obligations..................................................... 87
8.1.4. Non-Performance of Other Covenants and
Obligations..................................................... 87
8.1.5. Default on Other Indebtedness................................... 87
8.1.6. Judgments....................................................... 88
8.1.7. Pension Plans................................................... 88
8.1.8. Control of the Borrower......................................... 88
8.1.9. Bankruptcy, Insolvency, etc..................................... 88
8.1.10. Impairment of Security, etc..................................... 89
8.1.11. Material Adverse Change......................................... 89
8.1.12. Satellite Failure............................................... 90
8.2. Action if Bankruptcy............................................ 90
8.3. Action if Other Event of Default................................ 90
ARTICLE IX
THE AGENTS
9.1. Actions......................................................... 90
9.2. Funding Reliance, etc........................................... 91
9.3. Exculpation..................................................... 92
9.4. Successor....................................................... 92
9.5. Loans by Agents................................................. 93
9.6. Credit Decisions................................................ 93
9.7. Copies, etc..................................................... 93
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TABLE OF CONTENTS
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(continued)
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ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc........................................ 94
10.2. Notices......................................................... 95
10.3. Payment of Costs and Expenses................................... 95
10.4. Indemnification................................................. 66
10.5. Survival........................................................ 98
10.6. Severability.................................................... 98
10.7. Headings........................................................ 98
10.8. Execution in Counterparts, Effectiveness, etc................... 98
10.9. Governing Law; Entire Agreement................................. 98
10.10. Successors and Assigns.......................................... 99
10.11. Sale and Transfer of Loans and Notes;
Participations in Loans and Notes............................. 99
10.11.1. Assignments..................................................... 99
10.11.2. Participations.................................................. 101
10.12. Other Transactions.............................................. 102
10.13. Execution on Behalf of Corporation.............................. 102
10.14. Forum Selection and Consent to Jurisdiction..................... 102
10.15. Waiver of Jury Trial............................................ 103
SCHEDULE I - Disclosure Schedule
EXHIBIT A - Form of Note
EXHIBIT B - Form of Borrowing Request
EXHIBIT C - Form of Issuance Request
EXHIBIT D - Form of Continuation/Conversion Notice
EXHIBIT E - Form of Lender Assignment Agreement
EXHIBIT F - Form of Borrower Pledge Agreement
EXHIBIT G-1 - Form of Borrower Security Agreement
EXHIBIT G-2 - Form of Subsidiary Security Agreement
EXHIBIT H - Form of Subsidiary Guaranty
EXHIBIT I - Form of Contract Assignment Agreement
EXHIBIT J - Form of Consent and Agreement
EXHIBIT K - Form of Borrower Closing Date Certificate
EXHIBIT L - Form of Compliance Certificate
EXHIBIT M - Form of Solvency Certificate
EXHIBIT N - Form of Exemption Certificate
EXHIBIT O - Form of Opinion of Counsel to Obligors
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of December 31, 1996, is among TCI
SATELLITE ENTERTAINMENT, INC., a Delaware corporation (the "Borrower"), the
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various financial institutions as are or may become parties hereto
(collectively, the "Lenders"), NATIONSBANK OF TEXAS, N.A. ("NationsBank"), as
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syndication agent for the Lenders (in such capacity, the "Syndication Agent"),
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CREDIT LYONNAIS NEW YORK BRANCH ("Credit Lyonnais"), as documentation agent for
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the Lenders (in such capacity, the "Documentation Agent"), each of Credit
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Lyonnais, NationsBank and THE BANK OF NOVA SCOTIA ("Scotiabank") as arranging
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agents for the Lenders (in such capacity, the "Arranging Agents"), and
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Scotiabank, as administrative agent for the Lenders and such Agents (in such
capacity, the "Administrative Agent"; together with the Arranging Agents, the
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Syndication Agent and the Documentation Agent, the "Agents" and each an
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"Agent").
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W I T N E S S E T H:
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WHEREAS, the Borrower and its various Restricted Subsidiaries (such
capitalized term, and other capitalized terms used herein, to have the meanings
provided in Section 1.1) are engaged in the business of providing satellite
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broadcasting service to residential and commercial subscribers;
WHEREAS, the Borrower's Unrestricted Subsidiary, Tempo, is engaged in the
business of the construction and ownership of satellites for the direct
satellite broadcast market and the financing thereof;
WHEREAS, subject to the terms of this Agreement (including Article V), the
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Borrower desires to obtain from the Lenders
(a) a Commitment (to include availability for Letters of Credit)
pursuant to which Borrowings in a maximum aggregate principal amount
(together with all Letter of Credit Outstandings) not to exceed
$750,000,000 will be made to the Borrower from time to time prior to the
Commitment Termination Date; and
(b) a Letter of Credit sub-limit under the Commitment pursuant to
which each Issuer will issue Letters of Credit for the account of the
Borrower from time to time prior to the Commitment Termination Date in a
maximum aggregate Stated Amount at any one time outstanding not to exceed
$100,000,000 (provided that the aggregate outstanding principal amount of
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Loans and Letter of Credit Outstandings
at any time shall not exceed the then existing Commitment Amount);
with all the proceeds of the Credit Extensions to be used for the purposes
specified in Section 7.1.11; and
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WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth (including Article V), to extend such
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Commitment and make such Loans to the Borrower and issue (or participate in)
Letters of Credit for the account of the Borrower and its Restricted
Subsidiaries;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following capitalized terms (whether or not
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underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Administrative Agent" is defined in the preamble and includes each other
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Person as shall have subsequently been appointed as the successor Administrative
Agent pursuant to Section 9.4.
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"Affiliate" of any Person means any other Person which, directly or
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indirectly, controls, is controlled by or is under common control with such
Person (excluding with respect to the Borrower any (i) trustee under, or any
committee with responsibility for administering, any Plan, (ii) Lender and (iii)
Agent). A Person shall be deemed to be "controlled by" another Person if such
other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities having ordinary voting
power for the election of directors or managing general partners; or
(b) to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.
"Agent" and "Agents" are defined in the preamble and include each other
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Person as shall have subsequently been appointed as a successor Agent pursuant
to Section 9.4.
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"Agreement" means, on any date, this Credit Agreement as originally in
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effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to all Base Rate
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Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the Base Rate in effect on such day; and
(b) the Federal Funds Rate in effect on such day plus 1/2 of 1%.
Changes in the rate of interest on that portion of any Loans maintained as Base
Rate Loans will take effect simultaneously with each change in the Alternate
Base Rate. The Administrative Agent will give notice promptly to the Borrower
and the Lenders of changes in the Alternate Base Rate.
"Annualized Cash Flow" means, as of any date of determination, EBITDA for
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the Fiscal Quarter ending on or immediately prior to such date of determination
multiplied by four.
"Annualized Cash Flow to Pro Forma Debt Service Ratio" means the ratio of
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(a) Annualized Cash Flow to (b) Pro Forma Debt Service.
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"Annualized Cash Flow to Total Interest Expense Ratio" means, as of the
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last day of any Fiscal Quarter, the ratio of (a) Annualized Cash Flow to (b)
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Total Interest Expense for such Fiscal Quarter and the three immediately
preceding Fiscal Quarters.
"Annualized Revenue" means, as of any date of determination, Revenue for
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the Fiscal Quarter ending on or immediately prior to such date of determination
multiplied by four.
"Annualized Revenue per Subscriber" means, as of any date of determination,
---------------------------------
the quotient of (a) Annualized Revenue determined in respect of such date of
determination divided by (b) the average number of Basic Subscribers during the
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Fiscal Quarter ending on or immediately prior to such date of determination.
"Annual Pro-Forma Interest Expense" means, as of any date of determination,
---------------------------------
Pro-Forma Interest Expense for the four complete Fiscal Quarters immediately
succeeding such date of determination.
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"Applicable Margin" means at all times during the applicable periods set
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forth below:
(a) the Applicable Margin from the Effective Date through (and
including) the Satellite Event Date shall be 1.50% for Base Rate Loans,
2.50% for LIBO Rate Loans and 2.75% for CD Rate Loans;
(b) thereafter with respect to the unpaid principal amount of each
Loan maintained as a Base Rate Loan, the applicable percentage set forth
below under (i) Column A if the Senior Debt to Annualized Cash Flow Ratio
is greater than or equal to 4.0:1, (ii) Column B if the Senior Debt to
Annualized Cash Flow Ratio is greater than or equal to 3.0:1 and less than
4.0:1, and (iii) Column C if the Senior Debt to Annualized Cash Flow Ratio
is less than 3.0:1:
Total Debt
to Annualized Cash
Flow Ratio Column A Column B Column C
----------------------- --------- --------- ---------
Greater than or equal
to 7.0:1 1.25% 1.125% 1.00%
Greater than or equal
to 6.5:1 and less
than 7.0:1 1.00% 0.750% 0.625%
Greater than or equal
to 6.0:1 and less
than 6.5:1 0.750% 0.625% 0.500%
Greater than or equal
to 5.5:1 and less
than 6.0:1 0.500% 0.375% 0.250%
Greater than or equal
to 5.0:1 and less
than 5.5:1 0.250% 0.125% 0.000%
Less than 5.0:1 0.00% 0.00% 0.000%;
(c) thereafter with respect to the unpaid principal amount of each
Loan maintained as a LIBO Rate Loan, the applicable percentage set forth
below under (i) Column A if the Senior Debt to Annualized Cash Flow Ratio
is greater than or equal to 4.0:1, (ii) Column B if the Senior Debt to
Annualized Cash Flow Ratio is greater than or equal to 3.0:1 and less than
4.0:1, and (iii) Column C if the Senior Debt to Annualized Cash Flow Ratio
is less than 3.0:1:
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Total Debt
to Annualized Cash
Flow Ratio Column A Column B Column C
----------------------- --------- --------- ---------
Greater than or equal
to 7.0:1 2.250% 2.125% 2.000%
Greater than or equal
to 6.5:1 and less
than 7.0:1 2.000% 1.750% 1.625%
Greater than or equal
to 6.0:1 and less
than 6.5:1 1.750% 1.625% 1.500%
Greater than or equal
to 5.5:1 and less
than 6.0:1 1.500% 1.375% 1.250%
Greater than or equal
to 5.0:1 and less
than 5.5:1 1.250% 1.125% 1.000%
Greater than or equal
to 4.5:1 and less
than 5.0:1 0.875% 0.750% 0.625%
Less than 4.5:1 0.625% 0.500% 0.375%;
(d) thereafter with respect to the unpaid principal amount of each
Loan maintained as a CD Rate Loan, the applicable percentage set forth
below under (i) Column A if the Senior Debt to Annualized Cash Flow Ratio
is greater than or equal to 4.0:1, (ii) Column B if the Senior Debt to
Annualized Cash Flow Ratio is greater than or equal to 3.0:1 and less than
4.0:1, and (iii) Column C if the Senior Debt to Annualized Cash Flow Ratio
is less than 3.0:1:
Total Debt
to Annualized Cash
Flow Ratio Column A Column B Column C
----------------------- --------- --------- ---------
Greater than or equal
to 7.0:1 2.375% 2.250% 2.125%
Greater than or equal
to 6.5:1 and less
than 7.0:1 2.125% 1.875% 1.750%
Greater than or equal
to 6.0:1 and less
than 6.5:1 1.875% 1.750% 1.625%
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Total Debt
to Annualized Cash
Flow Ratio Column A Column B Column C
----------------------- -------- -------- --------
Greater than or equal
to 5.5:1 and less
than 6.0:1 1.625% 1.500% 1.375%
Greater than or equal
to 5.0:1 and less
than 5.5:1 1.375% 1.250% 1.125%
Greater than or equal
to 4.5:1 and less
than 5.0:1 1.000% 0.875% 0.750%
Less than 4.5:1 0.750% 0.625% 0.500%.
The Total Debt to Annualized Cash Flow Ratio and the Senior Debt to
Annualized Cash Flow Ratio used to compute the Applicable Margin following the
Satellite Event Date shall be the Total Debt to Annualized Cash Flow Ratio and
the Senior Debt to Annualized Cash Flow Ratio set forth in the Compliance
Certificate most recently delivered by the Borrower to the Administrative Agent;
changes in the Applicable Margin resulting from a change in the Total Debt to
Annualized Cash Flow Ratio and the Senior Debt to Annualized Cash Flow Ratio
shall become effective upon delivery by the Borrower to the Administrative Agent
of a new Compliance Certificate pursuant to clause (c) of Section 7.1.1. If the
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Borrower shall fail to deliver a Compliance Certificate within 60 days after the
end of any Fiscal Quarter (or within 105 days, in the case of the last Fiscal
Quarter of the Fiscal Year) as required pursuant to clause (c) of Section 7.1.1,
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the Applicable Margin from and including the 61st (or 106th, as the case may be)
day after the end of such Fiscal Quarter to but not including the date the
Borrower delivers to the Administrative Agent a Compliance Certificate shall
conclusively equal the highest Applicable Margin set forth above for such type
of Loans.
"Arranging Agents" is defined in the preamble and includes each other
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Person as shall have subsequently been appointed as a successor Arranging Agent
pursuant to Section 9.4.
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"Assessment Rate" means, for any Interest Period for CD Rate Loans, the net
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annual assessment rate (rounded upwards, if necessary, to the next higher 1/100
of 1%) estimated by the Administrative Agent to be the then current annual
assessment payable by the Administrative Agent to the Federal Deposit Insurance
Corporation (or any successor) for insuring time deposits at offices of the
Administrative Agent in the United States.
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"Assignee Lender" is defined in Section 10.11.1.
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"Authorized Officer" means, relative to the Borrower and any other Obligor,
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those of its officers or managing members (in the case of a limited liability
company) whose signatures and incumbency shall have been initially certified to
the Arranging Agents and the Lenders pursuant to Section 5.1.1 or thereafter
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similarly certified by the Borrower or such other Obligor to the Administrative
Agent.
"Available Commitment Amount" means an amount equal to the Commitment
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Amount less the Blocked Amount.
"Base Rate" means, at any time, the rate of interest then most recently
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established by Scotiabank in New York, New York as its base rate for Dollars
loaned in the United States. The Base Rate is not necessarily intended to be
the lowest rate of interest determined by Scotiabank in connection with
extensions of credit.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
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determined by reference to the Alternate Base Rate.
"Basic Subscriber" means (a) each dwelling unit, including a separate
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apartment within an apartment building, in respect of which the Borrower and its
Restricted Subsidiaries are paid the full monthly price for their basic
satellite services in accordance with standard basic rates generally charged by
the Borrower and its Restricted Subsidiaries in respect of such satellite
system, none of which is more than 60 days delinquent in its payment of basic
service and (b) each Equivalent Subscriber.
"Blocked Amount" means (a) for the period commencing on the Effective Date
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and ending on the Satellite Event Date $400,000,000, (b) for the period
commencing on the Satellite Event Date and ending on the date of the
Subordinated Debt Event $200,000,000 and (c) thereafter $0.
"Borrower" is defined in the preamble.
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"Borrower Closing Date Certificate" means the closing date certificate
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executed and delivered by the Borrower pursuant to Section 5.1.12, substantially
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in the form of Exhibit K hereto.
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"Borrower Pledge Agreement" means the pledge agreement executed and
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delivered by the Borrower pursuant to Section 5.1.5, substantially in the form
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of Exhibit F hereto, as amended, supplemented, amended and restated or otherwise
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modified from time to time.
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"Borrower Security Agreement" means the security agreement executed and
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delivered by the Borrower pursuant to Section 5.1.6, substantially in the form
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of Exhibit G-1 hereto, as amended, supplemented, amended and restated or
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otherwise modified from time to time.
"Borrowing" means the Loans of the same type and, in the case of Fixed Rate
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Loans, having the same Interest Period made by all Lenders required to make such
Loans on the same Business Day and pursuant to the same Borrowing Request in
accordance with Section 2.1.
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"Borrowing Request" means a Loan request and certificate duly executed by
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an Authorized Officer of the Borrower, substantially in the form of Exhibit B
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hereto.
"Business Day" means
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(a) any day which is neither a Saturday or Sunday nor a legal holiday
on which banks are authorized or required to be closed in New York, New
York; and
(b) relative to the making, continuing, prepaying or repaying of any
LIBO Rate Loans, any day which is a Business Day described in clause (a)
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above and which is also a day on which dealings in Dollars are carried on
in the interbank eurodollar market of the Administrative Agent's LIBOR
Office.
"Capital Expenditures" means, for any period, the aggregate amount of all
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expenditures of the Borrower and its Restricted Subsidiaries for fixed or
capital assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures.
"Capital Stock" means, with respect to any Person, any and all shares,
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interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital, whether now outstanding or
issued after the Effective Date.
"Capitalized Lease Liabilities" means all monetary obligations of the
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Borrower or any of its Restricted Subsidiaries under any leasing or similar
arrangement which, in accordance with GAAP, would be classified as capitalized
leases, and, for purposes of this Agreement and each other Loan Document, the
amount of such obligations shall be the capitalized amount thereof.
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"Cash Equivalent Investment" means, at any time:
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(a) any direct obligation of (or guaranteed by) the United States
Government (or any agency or instrumentality thereof) maturing not more
than one year after such time;
(b) commercial paper, maturing not more than nine months from the
date of issue, which is issued by
(i) a corporation (other than an Affiliate of any Obligor)
organized under the laws of any state of the United States or of the
District of Columbia and rated A-1 by S&P or P-1 by ▇▇▇▇▇'▇, or
(ii) any Lender (or its holding company);
(c) any certificate of deposit or bankers acceptance, maturing not
more than one year after such time, which is issued by either
(i) any bank organized under the laws of the United States (or
any State thereof) and which has (x) a credit rating of Aa or better
from ▇▇▇▇▇'▇ or a comparable rating from S&P and (y) a combined
capital and surplus greater than $500,000,000 (or the Dollar
equivalent thereof); or
(ii) any Lender; or
(d) any repurchase agreement entered into with any Lender or any
commercial banking institution of the stature referred to in clause (c)(i)
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which
(i) is secured by a fully perfected security interest in any
obligation of the type described in clause (a), and
----------
(ii) has a market value at the time such repurchase agreement is
entered into of not less than 100% of the repurchase obligation of
such commercial banking institution thereunder.
"CD Rate" means, relative to any Interest Period for CD Rate Loans, the
-------
rate of interest determined by the Administrative Agent to be the arithmetic
average (rounded upwards, if necessary, to the nearest 1/16 of 1%) of the
prevailing rates per annum bid at 12:00 noon, New York City time (or as soon
thereafter as practicable), on the first day of such Interest Period by two or
more certificate of deposit dealers of recognized standing located in New York,
New York for the purchase at face value from the Administrative Agent of its
-9-
certificates of deposit in an amount approximately equal to the CD Rate Loan
being made or maintained by the Administrative Agent to which such Interest
Period applies and having a maturity approximately equal to such Interest
Period.
"CD Rate Loan" means a Loan bearing interest, at all times during an
------------
Interest Period applicable to such Loan, at a fixed rate determined by reference
to the CD Rate (Reserve Adjusted).
"CD Rate (Reserve Adjusted)" means, relative to any Loan to be made,
--------------------------
continued or maintained as, or converted into, a CD Rate Loan for any Interest
Period, a rate per annum (rounded upwards, if necessary, to the nearest 1/16 of
1%) determined pursuant to the following formula:
CDR(RA) = CDR + AR
------------------
(1.00 - CDRR)
where:
CDR(RA) = CD Rate (Reserve Adjusted)
CDR = CD Rate
CDRR = CD Reserve Requirement
AR = Assessment Rate
The CD Rate (Reserve Adjusted) for any Interest Period for CD Rate Loans will be
determined by the Administrative Agent on the basis of the CD Reserve
Requirement and Assessment Rate in effect on, and the applicable rates furnished
to and received by the Administrative Agent on, the first day of such Interest
Period.
"CD Reserve Requirement" means, relative to any Interest Period for CD Rate
----------------------
Loans, a percentage (expressed as a decimal) equal to the maximum aggregate
reserve requirements (including all basic, supplemental, marginal and other
reserves and taking into account any transitional adjustments or other scheduled
changes in reserve requirements), specified under regulations issued from time
to time by the F.R.S. Board and then applicable to the class of banks of which
the Administrative Agent is a member, on deposits of the type used as a
reference in determining the CD Rate and having a maturity approximately equal
to such Interest Period.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
------
Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
-------
Liability Information System List.
-10-
"Change in Control" means
-----------------
(a) any "person" or "group" (as such terms are used in Rule 13d-5
under the Exchange Act, and Sections 13(d) and 14(d) of the Exchange Act)
of persons (other than ▇▇▇▇ ▇▇▇▇▇▇, the legal heirs of ▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇
▇▇▇▇▇▇, Primestar (so long as all the then other partners in Primestar were
partners in Primestar on the Effective Date) and/or Persons which were the
partners of Primestar on the Effective Date becomes, directly or
indirectly, in a single transaction or in a related series of transactions
by way of merger, consolidation, or other business combination or
otherwise, the "beneficial owner" (as such term is used in Rule 13d-3 of
the Exchange Act) of 25% or more of the outstanding shares of Voting Stock
of the Borrower; or
(b) both ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇ cease (i) to be directors of the
Borrower or (ii) to hold the same offices with the Borrower as such Person
held on the Effective Date and with at least substantially similar
responsibilities.
"Code" means the Internal Revenue Code of 1986, and the regulations
----
thereunder, in each case as amended, reformed or otherwise modified from time to
time.
"Collateral Subsidiary" is defined in clause (b) of Section 7.1.8.
--------------------- ---------- -------------
"Commitment" means, relative to any Lender, such Lender's obligation to
----------
make Loans pursuant to Section 2.1.1.
-------------
"Commitment Amount" means $750,000,000, as such amount may be reduced from
-----------------
time to time pursuant to Section 2.2 or Article IV.
----------- ----------
"Commitment Termination Date" means the earliest of
---------------------------
(a) January 31, 1997 (if the initial Credit Extension has not
occurred on or prior to such date);
(b) June 30, 2005;
(c) the date on which the Commitment Amount is terminated in full or
reduced to zero pursuant to Section 2.2; and
-----------
(d) the date on which any Commitment Termination Event occurs.
-11-
Upon the occurrence of any event described in the preceding clause (c) or (d),
---------- ---
the Commitment shall terminate automatically and without any further action.
"Commitment Termination Event" means
----------------------------
(a) the occurrence of any Event of Default described in clauses (a)
-----------
through (d) of Section 8.1.9; or
--- -------------
(b) the occurrence and continuance of any other Event of Default and
either
(i) the declaration of all or any portion of the Loans to be due
and payable pursuant to Section 8.3, or
-----------
(ii) the giving of notice by the Administrative Agent, acting at
the direction of the Required Lenders, to the Borrower that the
Commitments have been terminated.
"Compliance Certificate" means a certificate duly completed and executed by
----------------------
an Authorized Officer of the Borrower, substantially in the form of Exhibit L
---------
hereto, as amended, supplemented, amended and restated or otherwise modified
from time to time, together with such changes thereto as the Administrative
Agent may from time to time reasonably request for the purpose of monitoring the
Borrower's compliance with the financial covenants contained herein.
"Concentration Account Agreement" means any concentration account agreement
-------------------------------
executed and delivered by a concentration account bank, in each case
substantially in the form of Exhibit E to a Security Agreement, as amended,
supplemented, amended and restated or otherwise modified from time to time.
"Consent and Agreement" means, as the context may require, (i) the Consent
---------------------
and Agreement, dated as of December 31, 1996, between TCI and the Administrative
Agent or (ii) the Consent and Agreement, dated as of December 31, 1996, between
TCIC and the Administrative Agent, each substantially in the form of Exhibit J
---------
hereto, as amended, supplemented, amended and restated or otherwise modified
from time to time.
"Contingent Liability" means any agreement, undertaking or arrangement by
--------------------
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the Indebtedness of any
other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends
-12-
or other distributions upon the shares of any other Person. The amount of any
Person's obligation under any Contingent Liability shall (subject to any
limitation set forth therein) be deemed to be the outstanding amount of the
debt, obligation or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of continuation or
------------------------------
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit D hereto.
---------
"Contract Assignment Agreement" means the contract assignment agreement
-----------------------------
executed and delivered by an Authorized Officer of the Borrower pursuant to
Section 5.1.9, substantially in the form of Exhibit I hereto, as amended,
------------- ---------
supplemented, amended and restated or otherwise modified from time to time.
"Contractual Obligation", as applied to any Person, means any provision of
----------------------
any Securities issued by that Person or any indenture, mortgage, deed of trust,
security agreement, pledge agreement, guaranty, contract, undertaking, agreement
or 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.
"Controlled Group" means all members of a controlled group of corporations
----------------
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
"Copyright Security Agreement" means any copyright security agreement
----------------------------
executed and delivered by the Borrower or a Restricted Subsidiary, as the case
may be, in each case substantially in the form of Exhibit C to a Security
Agreement, as amended, supplemented, amended and restated or otherwise modified
from time to time.
"Covered Taxes" means any Taxes other than Taxes imposed with respect to
-------------
any Agent or any Lender by reason of a connection between such Agent or such
Lender and the relevant taxing jurisdiction, including a connection arising from
such Person being or having been a citizen or resident of such jurisdiction, or
having or having had a permanent establishment or fixed place of business or
being or having been engaged in business therein, but excluding a connection
arising solely from such Person having executed, delivered, performed its
obligations or received any payment under, or enforced, this Agreement or any
other Loan Document. Taxes shall be considered Covered Taxes if such Taxes are
imposed on (i) the Agent solely by reason of a connection
-13-
between a Lender (but not the Agent) and the relevant taxing jurisdiction or
(ii) a Lender solely by reason of a connection between the Agent or any other
Lender (but not such Lender) and the relevant taxing jurisdiction.
"Credit Extension" means, as the context may require,
----------------
(a) the making of a Loan by a Lender; or
(b) the issuance of any Letter of Credit, or the extension of any
Stated Expiry Date of any existing Letter of Credit, by an Issuer.
The conversion or continuation of any Loan shall not constitute a new Credit
Extension.
"Credit Extension Request" means, as the context may require, any Borrowing
------------------------
Request or Issuance Request.
"Default" means any Event of Default or any condition, occurrence or event
-------
which, after notice or lapse of time or both, would constitute an Event of
Default.
"Disbursement" is defined in Section 2.6.2.
------------ -------------
"Disbursement Date" is defined in Section 2.6.2.
----------------- -------------
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
-------------------
Schedule I, as it may be amended, supplemented, amended and restated or
----------
otherwise modified from time to time by the Borrower with the written consent of
the Administrative Agent and the Required Lenders.
"Documentation Agent" is defined in the preamble and includes each other
------------------- --------
Person as shall have subsequently been appointed as the successor Documentation
Agent pursuant to Section 9.4.
-----------
"Dollar" and the sign "$" mean lawful money of the United States.
------ -
"Domestic Office" means, relative to any Lender, the office of such Lender
---------------
designated as such Lender's "Domestic Office" below its signature hereto or in a
Lender Assignment Agreement, or such other office of a Lender (or any successor
or assign of such Lender) within the United States as may be designated from
time to time by notice from such Lender, as the case may be, to each other
Person party hereto.
-14-
"EBITDA" means, for the Borrower and its Restricted Subsidiaries, for any
------
applicable period, the sum (without duplication) for such period of
(a) Net Income,
plus
----
(b) the amount deducted in determining Net Income representing
amortization (including amortization with respect to goodwill, deferred
financing costs, other non-cash interest income and expense and all other
intangible assets),
plus
----
(c) the amount deducted in determining Net Income of all federal,
state and local income taxes (whether paid in cash or deferred),
plus
----
(d) Total Interest Expense plus, without duplication, any non-cash
interest expense,
plus
----
(e) the amount deducted in determining Net Income representing
depreciation of assets,
plus
----
(f) the amount deducted in determining Net Income representing other
non-cash expenses,
plus
----
(g) for purposes of clauses (f) and (g) of Section 7.2.4 only, the
------------------- -------------
amount deducted in determining Net Income of net income of the High Power
Satellite Transmission Subsidiary.
"Effective Date" means the date this Agreement becomes effective pursuant
--------------
to Section 10.8.
------------
"Environmental Laws" means all applicable federal, state or local statutes,
------------------
laws, ordinances, codes, rules, regulations and guidelines (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment.
-15-
"Equity Interests", with respect to any Person, means any Capital Stock
----------------
issued by such Person, regardless of class or designation, or any limited or
general partnership interest in such Person, regardless of designation, and all
warrants, options, purchase rights, conversion or exchange rights, voting
rights, calls or claims of any character with respect thereto.
"Equivalent Subscribers" means all subscribers deemed to make up bulk
----------------------
subscribers (such as hotels and apartment buildings) of bulk basic subscription
services offered in a satellite system, where the number of Equivalent
Subscribers with respect to a bulk subscriber in such satellite system is deemed
to consist of the number obtained by dividing the monthly revenues for such bulk
subscriber by the average monthly basic subscription price for individual
subscribers in such satellite system. "Equivalent Subscriber" means each
---------------------
subscriber deemed to make up a bulk subscriber.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute thereto of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections thereto.
"Event of Default" is defined in Section 8.1.
---------------- -----------
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
------------
"Exemption Certificate" is defined in clause (b)(ii) of Section 4.6.
--------------------- -------------- -----------
"Federal Funds Rate" means, for any period, a fluctuating rate of interest
------------------
per annum equal for each day during such period to
(a) 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
(b) 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 the Administrative Agent from three federal funds brokers of
recognized standing selected by it.
"Fiscal Quarter" means a quarter ending on the last day of March, June,
--------------
September and December.
-16-
"Fiscal Year" means any period of twelve consecutive calendar months ending
-----------
on December 31; references to a Fiscal Year with a number corresponding to any
calendar year (e.g., the "1997 Fiscal Year") refer to the Fiscal Year ending on
----
December 31 of such calendar year.
"Fixed Rate Loan" means any CD Rate Loan or any LIBO Rate Loan.
---------------
"F.R.S. Board" means the Board of Governors of the Federal Reserve System
------------
or any successor thereto.
"Fulfillment Agreement" means the Fulfillment Agreement, dated as of August
---------------------
30, 1996, between TCIC and the Borrower, pursuant to which TCIC provides
fulfillment services to the Borrower, as such agreement is amended,
supplemented, amended and restated or otherwise modified from time to time.
"GAAP" is defined in Section 1.4.
---- -----------
"GE-2 Satellite Event" means the launch and viable operation of the GE
--------------------
American Communications, Inc. GE-2 satellite certified by the builder of such
satellite that fifteen transponders thereon are in full operation and have an
expected life of at least 8-1/2 years.
"Governmental Approval" means any action, authorization, consent, approval,
---------------------
license, lease, ruling, permit, tariff, rate, certification, exemption, filing,
variance, claim, order, judgment, decree, publication, notices to, declarations
of or with or registration by or with any Regulatory Authority.
"Governmental Rule" means any statute, law, regulation, ordinance, rule,
-----------------
judgment, order, decree, permit, concession, grant, franchise, license,
agreement, directive, guideline, policy, requirement, or other governmental
authorization including any conditions thereof, restriction or any similar form
of published or otherwise known decision of or determination by, or any
interpretation or administration of any of the foregoing by, any Regulatory
Authority, whether now or hereafter in effect (including any Environmental Law).
"Hazardous Material" means
------------------
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation
and Recovery Act, as amended; or
(c) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance
-17-
(including any petroleum product) within the meaning of any other
applicable federal, state or local law, regulation, ordinance or
requirement (including consent decrees and administrative orders) relating
to or imposing liability or standards of conduct concerning any hazardous,
toxic or dangerous waste, substance or material, all as amended.
"Hedging Obligations" means, with respect to any Person, all liabilities of
-------------------
such Person under currency exchange agreements, interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, and all other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates or currency exchange rates.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
------ ------ ------ ---------
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be, as a whole and not to any particular Section,
paragraph or provision of this Agreement or such other Loan Document.
"High Power Satellite Transmission Business" means the business of the
------------------------------------------
acquisition, transmission and sale of programming in the direct broadcast
satellite business utilizing broadcast satellite service operating in the Ku-
band which may utilize all or part of satellites owned or leased by Primestar or
a Subsidiary and all other activities relating thereto or arising therefrom
other than the construction, sale or financing of broadcast satellites.
"High Power Satellite Transmission Subsidiary" means a direct, wholly-owned
--------------------------------------------
Restricted Subsidiary of the Borrower which engages in the High Power Satellite
Transmission Business.
"Impermissible Qualification" means, relative to the opinion or
---------------------------
certification of any independent public accountant as to any financial statement
of the Borrower, any qualification or exception to such opinion or certification
(a) which is of a "going concern" or similar nature due to
circumstances arising other than from the failure of the Satellite Event
Date to occur on or prior to May 30, 1997;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause
the Borrower
-18-
to be in default of any of its obligations under Section 7.2.4.
-------------
"including" and "include" mean including without limiting the generality of
--------- -------
any description preceding such term, and, for purposes of this Agreement and
each other Loan Document, the parties hereto agree that the rule of ejusdem
generis shall not be applicable to limit a general statement, which is followed
by or referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"Indebtedness" of any Person means, without duplication:
------------
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which have
been or should be, in accordance with GAAP, recorded as Capitalized Lease
Liabilities;
(d) net liabilities of such Person under all Hedging Obligations;
(e) whether or not so included as liabilities in accordance with
GAAP, all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse; and
(f) all Contingent Liabilities of such Person in respect of any of
the foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the recourse Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer.
"Indemnification Agreements" means (a) the indemnification agreement, dated
--------------------------
as of December 4, 1996, between the Borrower and TCIC and (b) the
indemnification agreement, dated as of December
-19-
4, 1996, between the Borrower and TCI UA, Inc., as such agreements may be
amended from time to time.
"Indemnified Liabilities" is defined in Section 10.4.
----------------------- ------------
"Indemnified Parties" is defined in Section 10.4.
------------------- ------------
"Install Fees" means the amount charged and collected by or on behalf of
------------
the Borrower in connection with the installation of satellite dish and other
signal reception and decoding equipment leased or acquired by a Basic
Subscriber.
"Interest Period" means, relative to any Fixed Rate Loan, the period
---------------
beginning on (and including) the date on which such Fixed Rate Loan is made or
continued as, or converted into, a Fixed Rate Loan pursuant to Section 2.3 or
-----------
2.4 and shall end on (but exclude) the day which is, in the case of a CD Rate
---
Loan, 30, 60 or 90 (or if available to all relevant Lenders and at the
discretion of the Administrative Agent, 180) days thereafter, or which, in the
case of a LIBO Rate Loan, numerically corresponds to such date one, two, three
or six (or if available to all relevant Lenders and at the discretion of the
Administrative Agent, twelve) months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
----------- ---
provided, however, that
-------- -------
(a) the Borrower shall not be permitted to select Interest Periods to
be in effect at any one time which have expiration dates occurring on more
than fifteen different dates;
(b) if such Interest Period would otherwise end on a day which is not
a Business Day, such Interest Period shall end on the next following
Business Day (unless such next following Business Day is the first Business
Day of a calendar month, in which case such Interest Period shall end on
the Business Day next preceding such numerically corresponding day); and
(c) no Interest Period for any Loan (i) may be selected for any Loan
made prior to a date following the Effective Date agreed to in writing by
the Borrower and the Administrative Agent which would end after such date
and (ii) may end later than the Stated Maturity Date.
"Investment" means, relative to any Person,
----------
(a) any loan or advance made by such Person to any other Person
(excluding commission, travel, ▇▇▇▇▇ cash and
-20-
similar advances to officers and employees made in the ordinary course of
business);
(b) any Contingent Liability of such Person incurred in connection
with loans or advances described in clause (a); and
----------
(c) any ownership or similar interest held by such Person in any
other Person.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon and shall, if made by
the transfer or exchange of property other than cash, be deemed to have been
made in an original principal or capital amount equal to the fair market value
of such property at the time of such Investment.
"Issuance Request" means a Letter of Credit request and certificate duly
----------------
executed by an Authorized Officer of the Borrower, substantially in the form of
Exhibit C hereto.
---------
"Issuer" means Scotiabank in its capacity as issuer of the Letters of
------
Credit. Scotiabank may act or decline to act as an Issuer in its sole
discretion. At the request of Scotiabank, another Lender or an Affiliate of
Scotiabank may issue one or more Letters of Credit hereunder.
"Law Change" is defined in clause (b) of Section 4.6.
---------- ---------- -----------
"Lender Assignment Agreement" means a lender assignment agreement,
---------------------------
substantially in the form of Exhibit E hereto.
---------
"Lenders" is defined in the preamble and, in addition, shall include any
------- --------
commercial bank or other financial institution that becomes a Lender pursuant to
Section 10.11.1.
---------------
"Lender's Environmental Liability" means any and all losses, liabilities,
--------------------------------
obligations, penalties, claims, litigation, demands, defenses, costs, judgments,
suits, proceedings, damages (including consequential damages), disbursements or
expenses of any kind or nature whatsoever (including reasonable attorneys' fees
at trial and appellate levels and experts' fees and disbursements and expenses
incurred in investigating, defending against or prosecuting any litigation,
claim or proceeding) which may at any time be imposed upon, incurred by or
asserted or awarded against any Lender or any of such Lender's parent and
subsidiary corporations, and their Affiliates, shareholders, directors,
officers, employees, and agents in connection with or arising from:
-21-
(a) any Hazardous Material on, in, under or affecting all or any
portion of any property of the Borrower or any of its Subsidiaries, the
groundwater thereunder, or any surrounding areas thereof to the extent
caused by Releases from the Borrower's or any of the Borrower's
Subsidiaries' or any of their respective predecessors' properties;
(b) any misrepresentation, inaccuracy or breach of any warranty,
contained or referred to in Section 6.13;
------------
(c) any violation or claim of violation by the Borrower or any of its
Subsidiaries of any Environmental Laws; or
(d) the imposition of any lien for damages caused by or the recovery
of any costs for the cleanup, release or threatened release of Hazardous
Material by the Borrower or any of its Subsidiaries, or in connection with
any property owned or formerly owned by the Borrower or any of its
Subsidiaries.
"Letter of Credit" is defined in Section 2.1.2.
---------------- -------------
"Letter of Credit Commitment" means, with respect to an Issuer, such
---------------------------
Issuer's obligation to issue Letters of Credit pursuant to Section 2.1.2 and,
-------------
with respect to each of the other Lenders, the obligations of each such Lender
to participate in such Letters of Credit pursuant to Section 2.6.1.
-------------
"Letter of Credit Commitment Amount" means, on any date, $100,000,000, as
----------------------------------
such amount may be permanently reduced from time to time pursuant to Section
-------
2.2.
---
"Letter of Credit Outstandings" means, on any date, an amount equal to the
-----------------------------
sum of
(a) the then aggregate amount which is undrawn and available under
all issued and outstanding Letters of Credit,
plus
----
(b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate Loans, the
---------
rate of interest determined as follows:
(a) on the date two Business Days prior to the first day of such
Interest Period, the Administrative Agent shall obtain the offered
quotation(s) that appear on the ▇▇▇▇▇▇'▇
-22-
Screen for Dollar deposits for a period comparable to such Interest Period.
If at least two such offered quotations appear on the ▇▇▇▇▇▇'▇ Screen, the
LIBO Rate shall be the arithmetic average (rounded upwards, if necessary,
to the nearest 1/16th of 1%) of such offered quotations, as determined by
the Administrative Agent; or
(b) if the ▇▇▇▇▇▇'▇ Screen is not available or has been discontinued,
the LIBO Rate shall be the rate per annum which the Administrative Agent in
good faith determines to be the arithmetic average (rounded as aforesaid)
of the offered quotations for Dollar deposits in an amount comparable to
the Administrative Agent's share of the relevant amount in respect of which
the LIBO Rate is being determined for a period comparable to the relevant
LIBO Interest Period that leading banks in New York City selected by the
Administrative Agent are quoting at 11:00 a.m. on the date two Business
Days prior to the first day of such Interest Period in the New York
Interbank Market to major international banks.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
--------------
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be made,
----------------------------
continued or maintained as, or converted into, a LIBO Rate Loan for any Interest
Period, a rate per annum (rounded upwards, if necessary, to the nearest 1/16th
of 1%) determined pursuant to the following formula:
LIBO Rate = LIBO Rate
-------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be determined by the Administrative Agent on the basis of the LIBOR
Reserve Percentage in effect, and the applicable rates furnished to and received
by the Administrative Agent from Scotiabank two Business Days before, the first
day of such Interest Period.
"LIBOR Office" means, relative to any Lender, the office of such Lender
------------
designated as such Lender's "LIBOR Office" below its signature hereto or in a
Lender Assignment Agreement, or such other office of a Lender as designated from
time to time by notice from such Lender to the Borrower and the Administrative
Agent, whether or not outside the United States, which shall be making or
maintaining LIBO Rate Loans of such Lender hereunder.
-23-
"LIBOR Reserve Percentage" means, relative to any Interest Period for LIBO
------------------------
Rate Loans, the reserve percentage (expressed as a decimal) equal to the maximum
aggregate reserve requirements (including all basic, emergency, supplemental,
marginal and other reserves and taking into account any transitional adjustments
or other scheduled changes in reserve requirements) specified under regulations
issued from time to time by the F.R.S. Board and then applicable to assets or
liabilities consisting of or including "Eurocurrency Liabilities", as currently
defined in Regulation D of the F.R.S. Board, and applicable to all Lenders,
having a term approximately equal or comparable to such Interest Period.
"Lien" means any security interest, mortgage, pledge, hypothecation,
----
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property, or other priority or preferential
arrangement of any kind or nature whatsoever, to secure payment of a debt or
performance of an obligation.
"Loan" is defined in Section 2.1.1.
---- -------------
"Loan Documents" collectively means this Agreement, the Notes, the Letters
--------------
of Credit, each Rate Protection Agreement relating to Hedging Obligations of the
Borrower or any of its Subsidiaries, each Borrowing Request, each Issuance
Request, the Borrower Pledge Agreement, the Borrower Security Agreement, the
Subsidiary Security Agreement, each Patent Security Agreement, each Trademark
Security Agreement, each Copyright Security Agreement, the Contract Assignment
Agreement, each Consent and Agreement, the Concentration Account Agreement, each
Subsidiary Guaranty, the Post-Closing Events Letter and each other agreement,
certificate, document or instrument delivered in connection with this Agreement
and such other agreements, whether or not specifically mentioned herein or
therein.
"LodgeNet" means LodgeNet Entertainment Corporation.
--------
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
financial condition, operations, assets, business or properties of (i) the
Borrower, (ii) the Borrower and its Subsidiaries, taken as a whole, or (iii) the
Borrower and its Restricted Subsidiaries, taken as a whole, (b) the rights and
remedies of the Administrative Agent or any Secured Party under any Loan
Document, (c) the ability of the Borrower or any other Obligor (and, in the case
of the TCIC Credit Agreement, TCIC) as to perform its Obligations under any Loan
Document or Transaction Document to which it is or becomes a party or (d) the
perfection or priority of the Secured Parties' Liens upon the collateral
described in any Loan Document.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
-------
-24-
"Net Disposition Proceeds" means, with respect to a Permitted Disposition
------------------------
of the assets of the Borrower or any of its Subsidiaries, the excess of
(a) the gross cash proceeds received by the Borrower or any of its
Subsidiaries from any Permitted Disposition and any cash payments received
in respect of promissory notes or other non-cash consideration delivered to
the Borrower or such Subsidiary in respect of any Permitted Disposition,
less
----
(b) the sum of
(i) all reasonable and customary fees and expenses with
respect to legal, investment banking, brokerage and accounting and
other professional fees, sales commissions and disbursements and all
other reasonable fees, expenses and charges, in each case actually
incurred in connection with such Permitted Disposition other than such
amounts which have been paid to Affiliates of the Borrower in
violation of Section 7.2.13,
--------------
(ii) all taxes and other governmental costs and expenses
actually paid or estimated by the Borrower (in good faith) to be
payable in cash in connection with such Permitted Disposition;
provided, however, that if, after the payment of all taxes with
-------- -------
respect to such Permitted Disposition, the amount of estimated taxes,
if any, exceeded the tax amount actually paid in cash in respect of
such Permitted Disposition, the Commitment Amount shall be
automatically reduced by the aggregate amount of such excess, pursuant
to clause (b) of Section 2.2.2,
---------- -------------
(iii) payments made by the Borrower or any of its Subsidiaries
to retire Indebtedness (other than the Loans) of the Borrower or any
of its Subsidiaries where payment of such Indebtedness is required in
connection with such Permitted Disposition, and
(iv) an amount of such proceeds (other than proceeds of the
disposition of an asset of Tempo or the Capital Stock of Tempo),
which, at the option of the Borrower and so long as no Default shall
have occurred and be continuing, the Borrower uses or causes the
applicable Subsidiary to use such proceeds to purchase substantially
similar assets useful in the business of the Borrower or such
Subsidiary (with such assets or
-25-
interests collectively referred to as "Qualified Assets") within 365
----------------
days after the consummation (and with the proceeds) of such sale,
conveyance or disposition, and in the event the Borrower or such
Subsidiary elects to exercise its right to purchase Qualified Assets
with the Net Disposition Proceeds pursuant to this clause, the
Borrower shall deliver a certificate of an Authorized Officer to the
Administrative Agent within 30 days following the receipt of Net
Disposition Proceeds setting forth the amount of the Net Disposition
Proceeds which the Borrower or such Subsidiary expects to use to
purchase Qualified Assets during such 365-day period.
If and to the extent that the Borrower or such Subsidiary has elected to
reinvest Net Disposition Proceeds as permitted above, then on the date which is
365 days after the relevant sale, conveyance or disposition, the Borrower shall
deliver a certificate of an Authorized Officer to the Administrative Agent
certifying as to the amount and use of such Net Disposition Proceeds actually
used to purchase Qualified Assets. To the extent such Net Disposition Proceeds
are not so used to purchase Qualified Assets then the Commitment Amount shall be
automatically reduced by an amount equal to the aggregate amount of such
proceeds not so used to purchase Qualified Assets.
"Net Income" means, for any period, the difference of (a) the aggregate of
----------
all amounts (exclusive of all amounts in respect of any non-cash extraordinary
gains and any non-cash extraordinary losses) which, in accordance with GAAP,
would be included as net income on the consolidated financial statements of the
Borrower and its Restricted Subsidiaries for such period minus (b) the net
-----
income attributable to the High Power Satellite Transmission Business invested
in Tempo pursuant to clause (e) of Section 7.2.5 for such period.
---------- -------------
"Non-U.S. Lender" means any Lender that is not a U.S. Person.
---------------
"Note" means a promissory note of the Borrower payable to any Lender, in
----
the form of Exhibit A hereto (as such promissory note may be amended, endorsed
---------
or otherwise modified from time to time), evidencing the aggregate Indebtedness
of the Borrower to such Lender resulting from outstanding Loans, and also means
all other promissory notes accepted from time to time in substitution therefor
or renewal thereof.
"Obligations" means all obligations (monetary or otherwise, whether
-----------
absolute or contingent, matured or unmatured, direct or indirect, ▇▇▇▇▇▇ or
inchoate, sole, joint, several or joint and several, due or to become due,
heretofore or hereafter contracted
-26-
or acquired) of the Borrower and each other Obligor arising under or in
connection with this Agreement, the Notes, the Letters of Credit and each other
Loan Document.
"Obligor" means, as the context may require, the Borrower, each Restricted
-------
Subsidiary and any other Person (other than a Secured Party) to the extent such
Person is obligated under this Agreement or any other Loan Document.
"Organic Document" means, relative to any Obligor, as applicable, its
----------------
certificate of incorporation, by-laws, certificate of partnership, partnership
agreement, certificate of formation, limited liability agreement and all
shareholder agreements, voting trusts and similar arrangements applicable to any
of such Obligor's partnership interests, limited liability company interests or
authorized shares of Capital Stock.
"Participant" is defined in Section 10.11.2.
----------- ---------------
"Patent Security Agreement" means any patent security agreement executed
-------------------------
and delivered by the Borrower or a Restricted Subsidiary, as the case may be, in
each case substantially in the form of Exhibit A to a Security Agreement, as
amended, supplemented, amended and restated or otherwise modified from time to
time.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
----
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in Section
------------
3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer
plan as defined in Section 4001(a)(3) of ERISA), and to which the Borrower or
any corporation, trade or business that is, along with the Borrower, a member of
a Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of Section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under Section 4069 of ERISA.
"Percentage" means, relative to any Lender, the percentage set forth
----------
opposite its signature hereto or set forth in a Lender Assignment Agreement, as
such percentage may be adjusted from time to time pursuant to Lender Assignment
Agreement(s) executed by such Lender and its Assignee Lender(s) and delivered
pursuant to Section 10.11.1.
---------------
"Permitted Disposition" means a sale, disposition or other conveyance of
---------------------
assets by the Borrower or any of its Subsidiaries in accordance with the terms
of clauses (a)(iv) and (v) of Section 7.2.11 or as otherwise agreed to by the
--------------- --- --------------
Required Lenders.
-27-
"Permitted Refinancing" means, relative to any Indebtedness, any other
---------------------
Indebtedness which is incurred to repay and retire in full such refinanced
Indebtedness and all other monetary obligations in respect of such refinanced
Indebtedness; provided, however, that
-------- -------
(a) such refinancing Indebtedness shall not be incurred in an
original principal amount which exceeds the aggregate amount on the date of
such refinancing of the outstanding amount of such refinanced Indebtedness
plus the then aggregate amount of all such other monetary obligations in
respect thereof;
(b) the weighted average life of such refinancing Indebtedness shall
not be less than the weighted average life on the date of such refinancing
of such refinanced Indebtedness;
(c) the refinancing Indebtedness shall not impose on the Borrower or
any Restricted Subsidiary rates of interest, prepayment changes or other
fees or other amounts that are more than 2% per annum higher that the
highest respective amounts thereof payable in respect of such refinanced
Indebtedness;
(d) the refinancing Indebtedness shall not contain terms and
conditions that, taken as a whole, make the refinancing Indebtedness
materially more burdensome to the Borrower or Restricted Subsidiaries, or,
except in the case of the refinancing of Indebtedness permitted under
clause (d) of Section 7.2.2, materially more beneficial to the holders of
---------- -------------
the refinancing Indebtedness, than the terms in effect on the date of such
refinancing of the refinanced Indebtedness; and
(e) if such refinanced Indebtedness is Subordinated Debt or the TCIC
Credit Agreement, the refinancing Indebtedness shall not contain rights and
remedies that, taken as a whole, are materially more detrimental to the
Lenders or materially more beneficial to the holders of the refinancing
Indebtedness, than the terms in effect on the date of such refinancing of
the refinanced Indebtedness.
"Person" means any natural person, corporation, limited liability company,
------
partnership, joint venture, joint stock company, firm, association, trust or
unincorporated organization, government, governmental agency, court or any other
legal entity, whether acting in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
----
-28-
"Pledged Subsidiary" means, at any time, each Subsidiary in respect of
------------------
which the Administrative Agent has been granted, at such time, a security
interest in and to, or a pledge of, (i) any of the issued and outstanding shares
of Capital Stock of such Subsidiary, or (ii) any intercompany notes of such
Subsidiary owing to the Borrower or another Subsidiary of the Borrower.
"Post-Closing Events Letter" means that certain letter, dated as of the
--------------------------
date of the initial Credit Extension, executed and delivered by the Borrower and
the Administrative Agent, as the same may be amended or otherwise changed in
accordance with the terms thereof.
"Primestar" means PRIMESTAR Partners, L.P., a Delaware limited partnership.
---------
"Primestar Partnership Agreement" means the Limited Partnership Agreement
-------------------------------
of K Prime Partners, L.P., dated February 8, 1990, among the parties thereto, as
amended, as such agreement may be further amended, supplemented, amended and
restated or otherwise modified from time to time.
"Pro Forma Balance Sheet" is defined in clause (c) of Section 5.1.11.
----------------------- ---------- --------------
"Pro-Forma Debt Service" means, on any date of determination, in respect of
----------------------
the Borrower and its Restricted Subsidiaries, the sum of (a) all Annual Pro-
Forma Interest Expense, plus (b) scheduled principal payments including the
----
current maturities thereof, due on Total Debt for the four Fiscal Quarters
immediately succeeding such date of determination thereof plus (c) an amount
----
equal to the excess of the (i) sum of (x) the aggregate principal amount of all
Loans and (y) the Letters of Credit Outstanding on such date over (ii) the
Available Commitment Amount as such Available Commitment Amount is scheduled to
be reduced pursuant to clause (a) of Section 2.2 during the four Fiscal Quarters
---------- -----------
immediately succeeding such date of determination.
"Pro-Forma Interest Expense" means, for any period for which a
--------------------------
determination thereof is to be made, the sum of (a) the amount of all interest
which is payable in cash during such period on Total Debt of the Borrower and
its Restricted Subsidiaries on a consolidated basis which, without duplication,
is scheduled to be paid or will accrue during such period, including, without
limitation, in respect of the Loans and Subordinated Debt plus (b) all
----
commitment, line of credit, letter of credit, guarantee and similar fees (no
matter how designated) scheduled or required to be paid by the Borrower and its
Restricted Subsidiaries to any lender in exchange for such lender's commitment
to lend to the Borrower and its Restricted Subsidiaries, including, without
-29-
limitation, the commitment fee in respect of the Loans and Letters of Credit,
which is scheduled or required to be paid by the Borrower and its Restricted
Subsidiaries during such period. For purposes of calculating Pro-Forma Interest
Expense (i) where any item of interest on any Total Debt varies or depends upon
a variable rate of interest, such rate shall be assumed to equal the rate in
effect on the date of calculation thereof and (ii) the principal amount
outstanding under any revolving or line of credit facility shall be assumed to
be the outstanding principal balance thereunder on the last day of the Fiscal
Quarter immediately preceding the period in respect of which the calculation of
Pro-Forma Interest Expense is being determined as adjusted for any scheduled
principal payments during such period.
"Qualified Assets" is defined in clause (b)(iv) of the definition of Net
---------------- --------------
Disposition Proceeds.
"Quarterly Payment Date" means the last day of March, June, September and
----------------------
December, or, if any such day is not a Business Day, the next succeeding
Business Day.
"Rate Protection Agreement" means, collectively, any interest rate swap,
-------------------------
cap, collar or similar agreement entered into by the Borrower pursuant to the
terms of this Agreement under which the counterparty to such agreement is (or at
the time such Rate Protection Agreement was entered into, was) a Lender or an
Affiliate of a Lender.
"Regulatory Authority" means any national, state or local government, any
--------------------
political subdivision or any governmental, quasi-governmental, judicial, public
or statutory instrumentality, authority, body or entity, other regulatory
bureau, authority, body or entity, foreign or domestic, including the Federal
Deposit Insurance Corporation, the Comptroller of the Currency, the F.R.S.
Board, any central bank or any comparable authority.
"Reimbursement Obligation" is defined in Section 2.6.3.
------------------------ -------------
"Release" means a "release", as such term is defined in CERCLA.
------- -------
"Replacement Satellite Event" means (a) the fulfillment of the conditions
---------------------------
to the GE-2 Satellite Event after March 1, 1997 and on or prior to May 30, 1997,
(b) the successful launch and commencement of operation of another permanent
substitute satellite to GE-2 due to the failure of the GE-2 Satellite Event to
occur on or prior to March 1, 1997 pursuant to a substantially similar procedure
of acceptance or (c) such other plan of continued operation of the Primestar
business as agreed to in writing by the Arranging Agents on or prior to May 30,
1997.
-30-
"Required Lenders" means, at any time,
----------------
(a) prior to the date that no Lender has a Percentage in excess of
20%, Lenders having 100% of the Commitment Amount; and
(b) on and after such date, Lenders holding at least 51% of the
Commitment Amount.
"ResNet" means ResNet Communications, Inc., a Delaware corporation.
------
"ResNet Holdco" means TCI Satellite MDU, Inc.
-------------
"Resource Conservation and Recovery Act" means the Resource Conservation
--------------------------------------
and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended.
-- ---
"Restricted Junior Payment" means (a) any dividend or distribution, direct
-------------------------
or indirect, on account of any Equity Interests in the Borrower or any of its
Subsidiaries now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock or in any junior class of stock to the holders of
that class, provided that the issuance of such stock or junior class of stock is
not an incurrence of Indebtedness, (b) any redemption, retirement, sinking fund
or similar payment, purchase or other acquisition for value, direct or indirect,
of any Equity Interests in the Borrower or any of its Subsidiaries now or
hereafter outstanding, (c) any payment or prepayment of principal of, premium,
if any, or interest, fees or other charges on or with respect to, and any
redemption, purchase, retirement, defeasance, sinking fund or similar payment
and any claim for rescission with respect to, any Subordinated Debt of the
Borrower or any of its Subsidiaries or the TCIC Credit Agreement other than a
Permitted Refinancing or (d) any payment made to redeem, purchase, repurchase or
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire Equity Interests in the Borrower or any of its
Subsidiaries now or hereafter outstanding.
"Restricted Subsidiary" means each U.S. Subsidiary of the Borrower other
---------------------
than an Unrestricted Subsidiary of which the Borrower owns directly or
indirectly at least 80% of the outstanding Capital Stock.
"▇▇▇▇▇▇'▇ Screen" shall mean the display designated at page "LIBO" on the
---------------
▇▇▇▇▇▇ Monitor System or such other display on the ▇▇▇▇▇▇ Monitor System as may
replace such page displaying the London interbank offered rates as of 11:00
a.m., London time, on the day on which the relevant determination is made.
-31-
"Revenue" means, for any period, the difference of (a) the consolidated
-------
revenues of the Borrower and its Restricted Subsidiaries for such period minus
-----
(b) the amount of Installation Fees for such period.
"S&P" means Standard & Poor's Rating Services.
---
"Satellite Event Date" means the date on which the Arranging Agents, in
--------------------
their sole discretion, are satisfied with the GE-2 Satellite Event or the
Replacement Satellite Event, as the case may be.
"Scotiabank" is defined in the preamble.
---------- --------
"SEC" means the Securities and Exchange Commission.
---
"Secured Parties" means, collectively, the Lenders, the Issuers, each
---------------
Agent, each counterparty to a Rate Protection Agreement that is (or at the time
such Rate Protection Agreement was entered into, was) a Lender or an Affiliate
thereof and (in each case), each of their respective successors, transferees and
assigns.
"Securities" means any limited, general or other partnership interest, or
----------
any stock, shares, voting trust certificates, bonds, debentures, notes or other
Equity Interests or evidences of indebtedness, secured or unsecured,
convertible, subordinated or otherwise, 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, but shall not include any evidence of the Obligations.
"Security Agreement" means, as the context may require, the Borrower
------------------
Security Agreement and/or a Subsidiary Security Agreement.
"Senior Debt" means, at any time, all outstanding Total Debt which is not
-----------
Subordinated Debt.
"Senior Debt to Annualized Cash Flow Ratio" means, as of any date of
-----------------------------------------
determination, the ratio of (a) Senior Debt to (b) Annualized Cash Flow.
--
"Solvency Certificate" means the certificate executed and delivered by the
--------------------
chief financial or accounting Authorized Officer of the Borrower pursuant to
Section 5.1.14, substantially in the form of Exhibit M hereto.
-------------- ---------
-32-
"Stated Amount" of each Letter of Credit means the total amount available
-------------
to be drawn under such Letter of Credit upon the issuance thereof.
"Stated Expiry Date" is defined in Section 2.6.
------------------ -----------
"Stated Maturity Date" means June 30, 2005.
--------------------
"Subject Debt" is defined in Section 8.1.5.
------------ -------------
"Subject Lender" is defined in Section 4.11.
-------------- ------------
"Subordinated Debt" means unsecured Indebtedness of the Borrower (other
-----------------
than the TCIC Credit Agreement) subordinated in right of payment to the
Obligations pursuant to documentation containing interest rates, maturities,
amortization schedules, covenants, defaults, remedies, subordination provisions
and other material terms in form and substance reasonably satisfactory to the
Required Lenders.
"Subordinated Debt Event" means the issuance by the Borrower of at least
-----------------------
$300,000,000 in principal amount of Subordinated Debt.
"Subsidiary" means, with respect to any Person, any corporation,
----------
partnership or other business entity of which more than 50% of the outstanding
Capital Stock (or other ownership interest) having ordinary voting power to
elect a majority of the board of directors, managers or other voting members of
the governing body of such entity (irrespective of whether at the time Capital
Stock (or other ownership interest) of any other class or classes of such entity
shall or might have voting power upon the occurrence of any contingency) is at
the time directly or indirectly owned by such Person, by such Person and one or
more other Subsidiaries of such Person, or by one or more other Subsidiaries of
such Person. Unless the context otherwise specifically requires, the term
"Subsidiary" shall be a reference to a Subsidiary of the Borrower.
"Subsidiary Guarantor" means each Restricted Subsidiary party to a
--------------------
Subsidiary Guaranty.
"Subsidiary Guaranty" means, as the context may require, the guaranty
-------------------
executed and delivered by each Subsidiary Guarantor pursuant to Section 5.1.10
--------------
or any guaranty executed and delivered by a Subsidiary pursuant to clause (a) of
----------
Section 7.1.7, in each case substantially in the form of Exhibit H hereto, as
------------- ---------
amended, supplemented, amended and restated or otherwise modified from time to
time.
-33-
"Subsidiary Security Agreement" means the security agreement executed and
-----------------------------
delivered by a Restricted Subsidiary pursuant to Section 7.1.7 or 7.1.8,
------------- -----
substantially in the form of Exhibit G-2 hereto, as amended, supplemented,
-----------
amended and restated or otherwise modified from time to time.
"Syndication Agent" is defined in the preamble and includes each other
----------------- --------
Person as shall have subsequently been appointed as a successor Syndication
Agent pursuant to Section 9.4.
-----------
"Taxes" means any present or future income, excise, stamp or franchise
-----
taxes and other taxes, fees, duties, withholdings or other charges of any nature
whatsoever imposed by (i) the United States or any taxing authority or political
subdivision thereof or (ii) any other jurisdiction as a result of a connection
between the Borrower and such taxing jurisdiction, and in each case any
interest, additions to tax, penalties or additional amounts payable with respect
thereto.
"Tax Sharing Agreement" means the Tax Sharing Agreement, dated as of July
---------------------
1, 1995, as amended, among TCI, TCIC, certain other consolidated subsidiaries of
TCI and the Borrower, as amended, supplemented, amended and restated or
otherwise modified from time to time.
"TCI" means Tele-Communications, Inc., a Delaware corporation.
---
"TCIC" means TCI Communications, Inc., a Delaware corporation.
----
"TCIC Credit Agreement" means the credit agreement, dated as of December 4,
---------------------
1996, between TCIC and the Borrower, as such credit agreement may be amended.
"TCI Term Loan" means the $250,000,000 principal amount term loan made to
-------------
the Borrower by TCI.
"Tempo" means Tempo Satellite, Inc., an Oklahoma corporation and a direct,
-----
wholly-owned Subsidiary of the Borrower.
"Total Debt" means, on any date of determination, an amount equal to the
----------
sum of (a) the outstanding principal amount of all Indebtedness as of such date
of the Borrower and its Restricted Subsidiaries of the type referred to in
clause (a) of the definition of "Indebtedness" (which, in the case of the Loans,
----------
shall be deemed to equal the amount of Loans outstanding on the last day of the
Fiscal Quarter ending on or immediately preceding the date of determination),
plus (b) the maximum aggregate amount of Indebtedness as of such date of the
----
type described in clause (b) of the definition of "Indebtedness" (which, in the
----------
-34-
case of Letter of Credit Outstandings, shall be deemed to equal the amount of
Letter of Credit Outstandings on the last day of the Fiscal Quarter ending on or
immediately preceding the date of determination), plus (c) the aggregate amount
----
as of such date of the Indebtedness described in clause (c) of the definition of
----------
"Indebtedness", plus (d) (without duplication) the aggregate amount on such date
----
of the Contingent Liabilities in respect of any of the foregoing.
"Total Debt Per Subscriber" means, as of any date of determination, the
-------------------------
quotient of (a) Total Debt divided by (b) the number of Basic Subscribers as of
----------
the last day of the Fiscal Quarter ending on or immediately prior to such date
of determination.
"Total Debt to Annualized Cash Flow Ratio" means the ratio of (a) Total
----------------------------------------
Debt to (b) Annualized Cash Flow.
--
"Total Interest Expense" means, for any period, the sum of (a) the
----------------------
aggregate cash interest expense (net of cash interest income) of the Borrower
and its Restricted Subsidiaries (including, to the extent the Borrower or any of
its Restricted Subsidiaries have any Contingent Liability in respect of such
interest expense, (i) in respect of any pro forma calculations, the interest
--- -----
expense of Unrestricted Subsidiaries and (ii) in respect of any period which
does not include any pro forma calculation, the amount of such interest expense
--- -----
actually paid or payable by the Borrower or any Restricted Subsidiary) for such
period, as determined in accordance with GAAP, including the portion of any
payments made in respect of Capitalized Lease Liabilities allocable to interest
expense plus (b) all commitment, letter of credit, guarantee, line of credit or
----
similar fees (no matter how designated) paid or scheduled or required to be paid
by the Borrower and its Restricted Subsidiaries to any lender in exchange for
such lender's commitment to lend to the Borrower and its Restricted
Subsidiaries, including, without limitation, the commitment fee in respect of
the Loans and Letters of Credit.
"Trademark Security Agreement" means any trademark security agreement
----------------------------
executed and delivered by the Borrower or a Restricted Subsidiary, as the case
may be, in each case substantially in the form of Exhibit B to a Security
Agreement, as amended, supplemented, amended and restated or otherwise modified
from time to time.
"Transaction Documents" collectively means the Fulfillment Agreement, the
---------------------
Transition Services Agreement, the Tax Sharing Agreement, each Indemnification
Agreement and the TCIC Credit Agreement.
-35-
"Transition Services Agreement" means the Transition Services Agreement,
-----------------------------
dated as of December 4, 1996, between the Borrower and TCI pursuant to which TCI
will provide to the Borrower certain services and other benefits, including
certain administrative and other services, as such agreement is amended,
supplemented, amended and restated or otherwise modified from time to time.
"type" means, relative to any Loan, the portion thereof, if any, being
----
maintained as a Base Rate Loan or a LIBO Rate Loan.
"U.C.C." means the Uniform Commercial Code as from time to time in effect
------
in the State of New York.
"United States" or "U.S." means the United States of America, its fifty
------------- ----
states and the District of Columbia.
"Unrestricted Subsidiary" means Tempo and any U.S. Subsidiary formed or
-----------------------
acquired after the Effective Date and designated by the Borrower as an
"Unrestricted Subsidiary" and accepted as such by the Required Lenders.
"U.S. Person" means any Person that is a "United States person" within the
-----------
meaning of Section 7701(a)(30) of the Code (or any applicable successor
provision).
"U.S. Subsidiary" means any Subsidiary that is incorporated or organized
---------------
under the laws of the United States or a state thereof.
"Voting Stock" means, with respect to any Person, Capital Stock of any
------------
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.
"Welfare Plan" means a "welfare plan", as such term is defined in section
------------
3(1) of ERISA.
"wholly-owned" means, with respect to any direct or indirect Subsidiary,
------------
any Subsidiary all of the outstanding common stock (or similar equity interest)
of which (other than any director's qualifying shares or investments by foreign
nationals mandated by applicable laws) is owned directly or indirectly by the
Borrower.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
--------------------
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in each other Loan Document, the
Disclosure Schedule, or any Borrowing Request, Issuance Request,
Continuation/Conversion Notice, Compliance Certificate, notice or other
-36-
communications delivered from time to time in connection with this Agreement or
any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
----------------
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
---------------------------------------
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, and all accounting determinations and computations hereunder or
thereunder (including under Section 7.2.4) shall be made, in accordance with,
-------------
those generally accepted accounting principles ("GAAP") applied in the
----
preparation of the financial statements referred to in clause (a) of Section
---------- -------
5.1.11. Unless otherwise expressly provided, all financial covenants and
------
defined financial terms shall be computed on a consolidated basis for the
Borrower and its Restricted Subsidiaries, in each case without duplication. If
any preparation in the financial statements referred to in Section 7.1.1
-------------
hereafter occasioned by the promulgation of rules, regulations, pronouncements
and opinions by or required by the Financial Accounting Standards Board or the
American Institute of Certified Public Accountants (or successors thereto or
agencies with similar functions) result in a change in any results, amounts,
calculations, ratios, standards or terms found in this Agreement or any Loan
Document from those which would be derived or be applicable absent such changes,
the Borrower may reflect such changes in the financial statements and
certificates required to be delivered pursuant to Section 7.1.1, but
-------------
calculations of financial covenants shall be made without giving effect to any
such changes. Upon the request of the Borrower or any Lender the parties hereto
agree to enter into negotiations in order to amend the financial covenants and
other terms of this Agreement if there occur any changes in GAAP that have a
material effect on the financial statements of the Borrower and its
Subsidiaries, so as to equitably reflect such changes with the desired result
that the criteria for evaluating the Borrower's and its Subsidiaries' financial
condition and such other terms shall be the same in all material respects after
such changes as if the changes had not been made.
-37-
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
SECTION 2.1. Commitments. On the terms and subject to the conditions of
-----------
this Agreement (including Sections 2.1.4, 2.1.5 and Article V),
-------------- ----- ---------
(a) each Lender severally agrees to make Loans pursuant to the
Commitments described in this Section 2.1; and
-----------
(b) the Issuer severally agrees that it will issue Letters of Credit
pursuant to Section 2.1.2, and each other Lender that has a Commitment
-------------
severally agrees that it will purchase participation interests in such
Letters of Credit pursuant to Section 2.6.1.
-------------
SECTION 2.1.1. Commitment of Each Lender. From time to time on any
-------------------------
Business Day occurring prior to the Commitment Termination Date, each Lender
will make loans (relative to such Lender, its "Loans") to the Borrower equal to
-----
such Lender's Percentage of the aggregate amount of each Borrowing requested by
the Borrower to be made on such day. The commitment of each such Lender
described in this Section 2.1.1 is herein referred to as its "Commitment". On
------------- ----------
the terms and subject to the conditions hereof, the Borrower may from time to
time borrow, prepay and reborrow Loans.
SECTION 2.1.2. Letter of Credit Commitment. From time to time on any
---------------------------
Business Day occurring prior to the Commitment Termination Date, the Issuer will
(a) issue one or more standby letters of credit (relative to such
Issuer, its "Letter of Credit") for the account of the Borrower in the
----------------
Stated Amount requested by the Borrower on such day; or
(b) extend the Stated Expiry Date of an existing Letter of Credit
previously issued hereunder to a date not later than the earlier of (x) the
Commitment Termination Date and (y) one year from the date of such
extension.
SECTION 2.1.3. Commitment Amount Availability. The aggregate amount of
------------------------------
Loans and Letter of Credit Obligations may not exceed at any time outstanding
the Available Commitment Amount.
SECTION 2.1.4. Lenders Not Permitted or Required to Make Loans. No Lender
-----------------------------------------------
shall be permitted or required to make any Loan
-38-
if, after giving effect thereto, the aggregate outstanding principal amount of
all Loans
(a) of all Lenders, together with the aggregate amount of all Letter
of Credit Outstandings, would exceed the Available Commitment Amount; or
(b) of such Lender, together with such Lender's Percentage of the
aggregate amount of all Letter of Credit Outstandings, would exceed such
Lender's Percentage of the Available Commitment Amount.
SECTION 2.1.5. Issuer Not Permitted or Required to Issue Letters of
----------------------------------------------------
Credit. No Issuer shall be permitted or required to issue any Letter of Credit
------
if, after giving effect thereto, (a) the aggregate amount of all Letter of
Credit Outstandings would exceed the Letter of Credit Commitment Amount or (b)
the sum of the aggregate amount of all Letter of Credit Outstandings plus the
aggregate principal amount of all Loans then outstanding would exceed the
Available Commitment Amount.
SECTION 2.2. Reduction of the Commitment Amount. The Commitment Amount is
----------------------------------
subject to reduction from time to time pursuant to this Section 2.2.
-----------
SECTION 2.2.1. Optional. The Borrower may, from time to time on any
--------
Business Day occurring after the Effective Date, voluntarily reduce the amount
of the Commitment Amount or the Letter of Credit Commitment Amount on the
Business Day so specified by the Borrower; provided, however, that all such
-------- -------
reductions shall require at least three Business Days' prior notice to the
Administrative Agent and be permanent, and any partial reduction of any
Commitment Amount shall be in a minimum amount of $5,000,000 and in an integral
multiple of $1,000,000.
SECTION 2.2.2. Mandatory. (a) On each date set forth below, the
---------
Commitment Amount shall, without any further action, automatically and
permanently be reduced by the percentage of the Commitment Amount as in effect
on March 31, 2001 as set forth opposite such date:
Percentage
Date Reduction
---- ---------
03/31/01 2.5%
06/30/01 2.5%
09/30/01 2.5%
12/31/01 2.5%
03/31/02 5.0%
06/30/02 5.0%
-39-
Percentage
Date Reduction
---- ---------
09/30/02 5.0%
12/31/02 5.0%
03/31/03 6.25%
06/30/03 6.25%
09/30/03 6.25%
12/31/03 6.25%
03/31/04 8.5%
06/30/04 8.5%
09/30/04 8.5%
12/31/04 8.5%
03/31/05 5.5%
06/30/05 5.5%;
provided, however, that on the Commitment Termination Date, the Commitment
-------- -------
Amount shall be zero. Voluntary reductions of the Commitment Amount made
pursuant to Section 2.2.1 shall be applied pro rata to diminish the amount of
------------- --- ----
scheduled reductions to the Commitment Amount thereafter becoming effective
pursuant to this Section.
(b) The Borrower shall, no later than five Business Days following the
receipt of any Net Disposition Proceeds, deliver to the Administrative Agent a
calculation of the amount of such Net Disposition Proceeds and the Commitment
Amount shall be automatically reduced by an amount equal to 100% of such Net
Disposition Proceeds.
(c) If the GE-2 Satellite Event has not occurred on or prior to March 1,
1997 and the Replacement Satellite Event has not occurred on or prior to May 30,
1997 then the Commitment Amount shall, without further action, be automatically
and permanently reduced by $400,000,000 on May 30, 1997. If the Satellite Event
Date has occurred, but the Subordinated Debt Event has not occurred on or prior
to December 31, 1998, the Commitment Amount will be reduced by $200,000,000 on
December 31, 1998.
(d) All reductions of the Commitment Amount made pursuant to this Section
-------
2.2.2 shall be applied pro rata to diminish the amount of scheduled reductions
----- --- ----
to the Commitment Amount.
SECTION 2.3. Borrowing Procedures. By delivering a Borrowing Request to
--------------------
the Administrative Agent on or before 12:00 noon, New York City time, on a
Business Day, the Borrower may from time to time irrevocably request, in the
case of Base Rate Loans, or on not less than three Business Days' notice in
-40-
the case of Fixed Rate Loans, and in either case not more than five Business
Days' notice, that a Borrowing be made in a minimum amount of $1,000,000 and an
integral multiple of $500,000, or in the unused amount of the applicable
Commitment; provided, however, that all initial Loans shall be made as Base Rate
-------- -------
Loans. On the terms and subject to the conditions of this Agreement, each
Borrowing shall be comprised of the type of Loans, and shall be made on the
Business Day, specified in such Borrowing Request. On or before 11:00 a.m. (New
York City time) on such Business Day each Lender shall deposit with the
Administrative Agent same day funds in an amount equal to such Lender's
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Administrative Agent shall specify from time to time by notice to the
Lenders. To the extent funds are received from the Lenders, the Administrative
Agent shall make such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Borrowing Request. No
Lender's obligation to make any Loan shall be affected by any other Lender's
failure to make any Loan.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
-------------------------------------
Continuation/Conversion Notice to the Administrative Agent on or before 12:00
noon, New York City time, on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than three Business Days' notice nor more than
five Business Days' notice, that all, or any portion in an aggregate minimum
amount of $1,000,000 and an integral multiple of $500,000, Loans be, in the case
of Base Rate Loans, converted into Fixed Rate Loans of either type or in the
case of Fixed Rate Loans of either type, be converted into a Base Rate Loan or a
Fixed Rate Loan of the other type or continued as a Fixed Rate Loan of such type
(in the absence of delivery of a Continuation/Conversion Notice with respect to
any Fixed Rate Loan at least three Business Days before the last day of the then
current Interest Period with respect thereto, such Fixed Rate Loan shall, on
such last day, automatically convert to a Base Rate Loan); provided, however,
-------- -------
that (i) each such conversion or continuation shall be pro rated among the
applicable outstanding Loans of all Lenders, and (ii) no portion of the
outstanding principal amount of any Loans may be continued as, or be converted
into, Fixed Rate Loans when any Default has occurred and is continuing.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
-------
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
--------
however, that such Fixed Rate Loan shall nonetheless be deemed to have been made
-------
and to be held by such Lender, and the obligation of the Borrower to repay such
Fixed Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch,
-41-
Affiliate or international banking facility. In addition, the Borrower hereby
consents and agrees that, for purposes of any determination to be made for
purposes of Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively assumed that
----------- --- --- ---
each Lender elected to fund all LIBO Rate Loans by purchasing Dollar deposits in
its LIBOR Office's interbank eurodollar market.
SECTION 2.6. Issuance Procedures. By delivering to the Administrative
-------------------
Agent an Issuance Request on or before 12:00 noon, New York City time, on a
Business Day, the Borrower may, from time to time irrevocably request, on not
less than three nor more than ten Business Days' notice, in the case of an
initial issuance of a Letter of Credit for the account of the Borrower, and not
less than three Business Days' prior notice, in the case of a request for the
extension of the Stated Expiry Date of a Letter of Credit, that the Issuer
issue, or extend the Stated Expiry Date of, as the case may be, an irrevocable
Letter of Credit in such form as may be requested by the Borrower and approved
by the Issuer, solely for the purposes described in Section 7.1.11. Each Letter
--------------
of Credit shall by its terms be stated to expire on a date (its "Stated Expiry
-------------
Date") no later than the earlier to occur of (i) the Commitment Termination Date
----
or (ii) one year from the date of its issuance. The Issuer will make available
to the beneficiary thereof the original of each Letter of Credit which it issues
hereunder. The Issuer shall give prompt written notice to the Administrative
Agent of the Stated Amount of any such Letter of Credit so issued.
SECTION 2.6.1. Other Lenders' Participation. Upon the issuance of each
----------------------------
Letter of Credit issued by an Issuer pursuant hereto, and without further
action, each Lender (other than the Issuer) that has a Commitment shall be
deemed to have irrevocably purchased, to the extent of its Percentage, a
participation interest in such Letter of Credit (including the Contingent
Liability and any Reimbursement Obligation with respect thereto), and such
Lender shall, to the extent of its Percentage, be responsible for reimbursing
promptly (and in any event within one Business Day) the Issuer for Reimbursement
Obligations which have not been reimbursed by the Borrower in accordance with
Section 2.6.3. In addition, such Lender shall, to the extent of its Percentage,
-------------
be entitled to receive a ratable portion of the Letter of Credit fees payable
pursuant to Section 3.3.3 with respect to each Letter of Credit (other than the
-------------
issuance fees payable to the Issuer of such Letter of Credit pursuant to the
last sentence of Section 3.3.3) and of interest payable pursuant to Section 3.2
------------- -----------
with respect to any Reimbursement Obligation. To the extent that any Lender has
reimbursed any Issuer for a Disbursement as required by this Section, such
Lender shall be entitled to receive its ratable portion of any amounts
subsequently received (from the Borrower or otherwise) in respect of such
Disbursement.
-42-
SECTION 2.6.2. Disbursements. The Issuer will notify the Borrower and the
-------------
Administrative Agent promptly of the presentment for payment of any Letter of
Credit issued by the Issuer, together with notice of the date (the "Disbursement
------------
Date") such payment shall be made (each such payment, a "Disbursement").
---- ------------
Subject to the terms and provisions of such Letter of Credit and this Agreement,
the Issuer shall make such payment to the beneficiary (or its designee) of such
Letter of Credit. Prior to 12:00 noon, New York City time, on the first
Business Day following the Disbursement Date, the Borrower will reimburse the
Administrative Agent, for the account of the Issuer, for all amounts which the
Issuer has disbursed under such Letter of Credit, together with interest thereon
at a rate per annum equal to the rate per annum then in effect for Base Rate
Loans (with the then Applicable Margin accruing on such amount) pursuant to
Section 3.2 for the period from the Disbursement Date through the date of such
-----------
reimbursement. Without limiting in any way the foregoing and notwithstanding
anything to the contrary contained herein or in any separate application for any
Letter of Credit, the Borrower hereby acknowledges and agrees that it shall be
obligated to reimburse the Issuer upon each Disbursement of a Letter of Credit,
and it shall be deemed to be the obligor for purposes of each such Letter of
Credit issued hereunder.
SECTION 2.6.3. Reimbursement. The obligation (a "Reimbursement
------------- -------------
Obligation") of the Borrower under Section 2.6.2 to reimburse the Issuer with
---------- -------------
respect to each Disbursement (including interest thereon), and, upon the failure
of the Borrower to reimburse the Issuer, each Lender's obligation under Section
-------
2.6.1 to reimburse the Issuer, shall be absolute and unconditional under any and
-----
all circumstances and irrespective of any setoff, counterclaim or defense to
payment which the Borrower or such Lender, as the case may be, may have or have
had against the Issuer or any such Lender, including any defense based upon the
failure of any Disbursement to conform to the terms of the applicable Letter of
Credit (if, in the Issuer's good faith opinion, such Disbursement is determined
to be appropriate) or any non-application or misapplication by the beneficiary
of the proceeds of such Letter of Credit; provided, however, that after paying
-------- -------
in full its Reimbursement Obligation hereunder, nothing herein shall adversely
affect the right of the Borrower or such Lender, as the case may be, to commence
any proceeding against the Issuer for any wrongful Disbursement made by the
Issuer under a Letter of Credit as a result of acts or omissions constituting
gross negligence or willful misconduct on the part of such Issuer.
SECTION 2.6.4. Deemed Disbursements. Upon the occurrence and during the
--------------------
continuation of any Default of the type described in Section 8.1.9 or, with
-------------
notice from the Administrative Agent,
-43-
upon the occurrence and during the continuation of any other Event of Default,
(a) an amount equal to that portion of all Letter of Credit
Outstandings attributable to the then aggregate amount which is undrawn and
available under all Letters of Credit issued and outstanding hereunder
shall, without demand upon or notice to the Borrower, be deemed to have
been paid or disbursed by the Issuer under such Letters of Credit
(notwithstanding that such amount may not in fact have been so paid or
disbursed); and
(b) upon notification by the Administrative Agent to the Borrower of
its obligations under this Section, the Borrower shall be immediately
obligated to reimburse the Issuer for the amount deemed to have been so
paid or disbursed by such Issuer.
Any amounts so payable by the Borrower pursuant to this Section shall be
deposited in cash with the Administrative Agent and held as collateral security
for the Obligations in connection with the Letters of Credit issued by the
Issuers. At such time when the Defaults or Events of Default giving rise to the
deemed disbursements hereunder shall have been cured or waived, the
Administrative Agent shall return to the Borrower all amounts then on deposit
with the Administrative Agent pursuant to this Section which have not been
applied to the partial satisfaction of such Obligations.
SECTION 2.6.5. Nature of Reimbursement Obligations. The Borrower and, to
-----------------------------------
the extent set forth in Section 2.6.1, each Lender shall assume all risks of the
-------------
acts, omissions or misuse of any Letter of Credit by the beneficiary thereof.
The Issuer (except to the extent of its own gross negligence or wilful
misconduct) shall not be responsible for:
(a) the form, validity, sufficiency, accuracy, genuineness or legal
effect of any Letter of Credit or any document submitted by any party in
connection with the application for and issuance of a Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged;
(b) the form, validity, sufficiency, accuracy, genuineness or legal
effect of any instrument transferring or assigning or purporting to
transfer or assign a Letter of Credit or the rights or benefits thereunder
or the proceeds thereof in whole or in part, which may prove to be invalid
or ineffective for any reason;
-44-
(c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit;
(d) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or otherwise; or
(e) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Disbursement under a Letter
of Credit.
None of the foregoing shall affect, impair or prevent the vesting of any of the
rights or powers granted to the Issuer or any Lender. In furtherance and
extension and not in limitation or derogation of any of the foregoing, any
action taken or omitted to be taken by an Issuer in good faith (and not
constituting gross negligence or willful misconduct) shall be binding upon the
Borrower and each such Lender, and shall not put such Issuer under any resulting
liability to the Borrower or any such Lender, as the case may be.
SECTION 2.7. Notes. Each Lender's Loans under the Commitment shall be
-----
evidenced by a Note payable to the order of such Lender in a maximum principal
amount equal to such Lender's Percentage of the original Commitment Amount. The
Borrower hereby irrevocably authorizes each Lender to make (or cause to be made)
appropriate notations on the grid attached to such Lender's Note (or on any
continuation of such grid), which notations, if made, shall evidence, inter
-----
alia, the date of, the outstanding principal of, and the interest rate and
----
Interest Period applicable to the Loans evidenced thereby. Such notations shall
be conclusive and binding on the Borrower absent manifest error; provided,
--------
however, that the failure of any Lender to make any such notations shall not
-------
limit or otherwise affect any Obligations of the Borrower or any other Obligor.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. The Borrower shall repay in full
--------------------------
the unpaid principal amount of each Loan upon the Stated Maturity Date therefor.
Prior thereto, the Borrower
(a) may make a voluntary prepayment, in whole or in part, of the
outstanding principal amount of any Loans, provided, however, that
-------- -------
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(i) any such prepayment shall be made pro rata among Loans of
--- ----
the same type and, if applicable, having the same Interest Period of
all Lenders;
(ii) no such prepayment of any Fixed Rate Loan may be made on
any day other than the last day of the Interest Period for such Loan
unless the Borrower complies with Section 4.4 in respect thereof;
-----------
(iii) all such voluntary prepayments shall require, in the case
of LIBO Rate Loans, at least three Business Days' prior written notice
and, in the case of Base Rate Loans, at least one Business Day's prior
written notice, and in either case not more than five Business Days'
prior written notice to the Administrative Agent; and
(iv) all such voluntary partial prepayments shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of
$500,000;
(b) shall, on each date when the sum of (i) the aggregate outstanding
principal amount of all Loans and (ii) the aggregate amount of all Letter
of Credit Outstandings exceeds the Available Commitment Amount, make a
mandatory prepayment of all the Loans and, if necessary, give cash
collateral to the Administrative Agent pursuant to an agreement
satisfactory to the Administrative Agent to collateralize Letter of Credit
Outstandings, in an aggregate amount equal to such excess;
(c) shall, on each date when any reduction in the Commitment Amount
shall become effective, including pursuant to Section 2.2, make a mandatory
-----------
prepayment of all Loans equal to the excess, if any, of the aggregate,
outstanding principal amount of all Loans and Letter of Credit Outstandings
over the Available Commitment Amount as so reduced; and
(d) shall, immediately upon any acceleration of the Stated Maturity
Date of any Loans pursuant to Section 8.2 or Section 8.3, repay all the
----------- -----------
Loans, unless, pursuant to Section 8.3, only a portion of all Loans is so
-----------
accelerated (in which case the portion so accelerated shall be so paid).
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 4.4. No voluntary
-----------
prepayment of principal of any Loans shall cause a reduction in the Commitment
Amount. Each prepayment or repayment of the principal of the Loans shall be
applied, to the extent of such prepayment or repayment, first, to
-----
-46-
the principal amount thereof being maintained as Base Rate Loans, and second, to
------
the principal amount thereof being maintained as LIBO Rate Loans.
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
-------------------
amount of Loans shall accrue and be payable in accordance with this Section 3.2.
-----------
SECTION 3.2.1. Rates. Pursuant to an appropriately delivered Borrowing
-----
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate Loan,
equal to the sum of the Alternate Base Rate from time to time in effect
plus the Applicable Margin;
(b) on that portion maintained as a CD Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the CD Rate
(Reserve Adjusted) for such Interest Period plus the Applicable Margin; and
(c) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the LIBO Rate
(Reserve Adjusted) for such Interest Period plus the Applicable Margin.
All Fixed Rate Loans shall bear interest from and including the first day
of the applicable Interest Period to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such Fixed Rate
Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal amount
-------------------
of any Loan or Reimbursement Obligation is due and payable (whether on the
Stated Maturity Date, upon acceleration or otherwise), or after any other
monetary Obligation of the Borrower shall have become due and payable, the
Borrower shall pay, but only to the extent permitted by law, interest (after as
well as before judgment) on such amounts at a rate per annum equal to the rate
(including any Applicable Margin) applicable to such Loan from time to time in
effect plus an additional margin of 2%.
----
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
-------------
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in part, of
principal outstanding on such Loan on the principal amount so paid or
prepaid;
-47-
(c) with respect to Base Rate Loans, on each Quarterly Payment Date
occurring after the Effective Date;
(d) with respect to Fixed Rate Loans, on the last Business Day of
each applicable Interest Period (and, if such Interest Period shall exceed
90 days or three months, as the case may be, on the 90th day or third-month
anniversary of such Interest Period, as the case may be);
(e) with respect to any Base Rate Loans converted into Fixed Rate
Loans on a day when interest would not otherwise have been payable pursuant
to clause (c), on the date of such conversion; and
----------
(f) on that portion of any Loans the Stated Maturity Date of which is
accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such
----------- -----------
acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
----
Section 3.3. All such fees shall be non-refundable.
-----------
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the
--------------
Administrative Agent for the account of each Lender, for the period (including
any portion thereof when any of its Commitments are suspended by reason of the
Borrower's inability to satisfy any condition of Article V) commencing on the
---------
Effective Date and continuing through the Commitment Termination Date, a
commitment fee in an amount equal to (i) 0.25% per annum of such Lender's
Percentage of the sum of the average daily portion of the Blocked Amount plus
----
(ii) 0.375% per annum of such Lender's Percentage of the sum of the average
daily unused portion of the Available Commitment Amount (net of Letter of Credit
Outstandings). All commitment fees payable pursuant to this Section shall be
calculated on a year comprised of 365 days and payable by the Borrower in
arrears on each Quarterly Payment Date, commencing with the first Quarterly
Payment Date following the Effective Date, and on the Commitment Termination
Date.
SECTION 3.3.2. Agency Fees. The Borrower agrees to pay to the Arranging
-----------
Agents and the Administrative Agent, for their own account, such fees in such
amounts and on such dates as agreed to in writing by the Borrower and the
applicable Agent.
-48-
SECTION 3.3.3. Letter of Credit Fee. The Borrower agrees to pay to the
--------------------
Administrative Agent, for the pro rata account of the Issuer and each other
--- ----
Lender, a Letter of Credit fee in an amount equal to the then Applicable Margin
for Loans maintained as LIBO Rate Loans, multiplied by the Stated Amount of each
such Letter of Credit, such fees being payable on the date of issuance of each
Letter of Credit (for the period from the date of issuance to the earlier of the
expiration date of the applicable Letter of Credit and the immediately
succeeding Quarterly Payment Date) and thereafter quarterly in advance on each
Quarterly Payment Date. The Borrower further agrees to pay to the Issuer such
fees and other amounts in such amounts and at such times as may be agreed to by
the Borrower and such Issuer in writing.
ARTICLE IV
CERTAIN CD RATE, LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. Fixed Rate Lending Unlawful. If any Lender shall determine
---------------------------
(which determination shall, upon notice thereof to the Borrower and the Lenders,
be conclusive and binding on the Borrower) that the introduction of or any
change in or in the interpretation of any law makes it unlawful, or any
Regulatory Authority asserts that it is unlawful, for such Lender to make,
continue or maintain any Loan as, or to convert any Loan into, a Fixed Rate
Loan, the obligations of such Lender to make, continue, maintain or convert any
such Fixed Rate Loan shall, upon such determination, forthwith be suspended
until such Lender shall notify the Administrative Agent that the circumstances
causing such suspension no longer exist, and all outstanding Fixed Rate Loans of
that type shall automatically convert into Base Rate Loans at the end of the
then current Interest Periods with respect thereto or sooner, if required by
such law or assertion.
SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall have
--------------------
determined that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to the Administrative Agent in its
relevant market; or
(b) by reason of circumstances affecting the Administrative Agent's
relevant market, adequate means do not exist for ascertaining the interest
rate applicable hereunder to Fixed Rate Loans,
then, upon notice from the Administrative Agent to the Borrower and the Lenders,
the obligations of all Lenders under Section 2.3 and Section 2.4 to make or
----------- -----------
continue any Loans as, or to convert
-49-
any Loans into, Fixed Rate Loans shall forthwith be suspended until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 4.3. Increased Fixed Rate Loan Costs, etc. The Borrower agrees to
------------------------------------
reimburse each Lender for any increase in the cost to such Lender of, or any
reduction in the amount of any sum receivable by such Lender in respect of,
making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Loans as, or of converting (or of its obligation to convert) any
Loans into, Fixed Rate Loans that arise in connection with (i) any change in, or
the introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in after the date hereof of, any law or regulation, directive, guideline,
decision or request (whether or not having the force of law) of any court or
Regulatory Authority except for such changes with respect to increased capital
costs and taxes which are governed by Sections 4.5 and 4.6, respectively, or
------------ ---
(ii) any changes in reserve requirements for "Eurocurrency Liabilities" as
defined in Regulation D of the F.R.S. Board which are not included in the
calculation of "LIBOR Reserve Percentage". Such Lender shall promptly notify
the Administrative Agent and the Borrower in writing of the occurrence of any
such event, such notice to state, in reasonable detail, the reasons therefor and
the additional amount required fully to compensate such Lender for such
increased cost or reduced amount. Such additional amounts shall be payable by
the Borrower directly to such Lender within five days of its receipt of such
notice, and such notice shall, in the absence of manifest error, be conclusive
and binding on the Borrower.
SECTION 4.4. Funding Losses. In the event any Lender shall incur any loss
--------------
or expense (including any loss (other than loss of profit) or expense incurred
by reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender to make, continue or maintain any portion of the principal amount
of any Loan as, or to convert any portion of the principal amount of any Loan
into, a Fixed Rate Loan) as a result of
(a) any conversion or repayment or prepayment of the principal amount
of any Fixed Rate Loans on a date other than the scheduled last day of the
Interest Period applicable thereto, whether pursuant to Section 3.1 or
-----------
otherwise;
(b) any Loans not being made as Fixed Rate Loans in accordance with
the Borrowing Request therefor; or
-50-
(c) any Loans not being continued as, or converted into, Fixed Rate
Loans in accordance with the Continuation/Conversion Notice therefor,
then, upon the written notice of such Lender to the Borrower (with a copy to the
Administrative Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or expense;
provided, however, that such loss or expense shall not include loss of the
-------- -------
Applicable Margin with respect to any Loan accruing after the date of such
payment. Such written notice (which shall include calculations in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
the Borrower.
SECTION 4.5. Increased Capital Costs. If any change in, or the
-----------------------
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court or Regulatory Authority,
affects or would affect the amount of capital required or expected to be
maintained by any Lender or any Person controlling such Lender, and such Lender
determines (in good faith but in its sole and absolute discretion) that the rate
of return on its or such controlling Person's capital as a consequence of the
Commitments or the Loans made, or the Letters of Credit participated in, by such
Lender is reduced to a level below that which such Lender or such controlling
Person could have achieved but for the occurrence of any such circumstance,
then, in any such case upon notice from time to time by such Lender to the
Borrower, the Borrower shall immediately pay directly to such Lender additional
amounts sufficient to compensate such Lender or such controlling Person for such
reduction in rate of return. A statement of such Lender as to any such
additional amount or amounts (including calculations thereof in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
the Borrower. In determining such amount, such Lender may use any method of
averaging and attribution that it (in its sole and absolute discretion) shall
deem applicable.
SECTION 4.6. Taxes. (a) All payments by the Borrower of principal of,
-----
and interest on, or other amounts in respect of, the Loans and all other amounts
payable hereunder (including fees) and the Notes shall be made free and clear of
and without deduction for any Taxes, except to the extent that any such
withholdings or deductions are required by applicable law, rule or regulations.
In that event, the Borrower will
(i) pay directly to the relevant authority the full amount of Taxes
required to be so withheld or deducted;
-51-
(ii) promptly forward to the Administrative Agent an official receipt
or other documentation satisfactory to the Administrative Agent evidencing
such payment to such authority; and
(iii) if such Taxes are Covered Taxes, pay to the Administrative
Agent for the account of the Lenders such additional amount or amounts as
is necessary to ensure that the net amount actually received by each Lender
will equal the full amount such Lender would have received had no such
withholding or deduction been required.
In addition, if the Borrower, any Lender, or any Agent is required by law at any
time to pay any Covered Tax on, or calculated by reference to, any sum received
or receivable by or on behalf of any Lender or any Agent under this Agreement or
any Notes, then (i) with respect solely to any such requirement with respect to
a Lender or an Agent, any applicable Lender or Agent shall, as promptly as
practicable following such Person having notice of such requirement, give notice
to the Borrower of such requirement and (ii) the Borrower shall, promptly after
having received such notice, pay or procure the payment of such Covered Tax. If
the Borrower pays any such Covered Taxes as required by the immediately
preceding sentence, then the Borrower will promptly forward to the
Administrative Agent an official receipt or other documentation satisfactory to
the Administrative Agent evidencing such payment of Covered Taxes to the
relevant taxing authority. Without prejudice to the preceding provisions, if
any Agent or any Lender is required by law to make any payment on account of
Covered Taxes on or in relation to any sum received under this Agreement or any
Note, or any liability for Covered Taxes in respect of any such sum is imposed,
levied or assessed against any Lender or any Agent, the Borrower will indemnify
each such Lender and Agent for the full amount of Covered Taxes paid by such
Lender or Agent (as the case may be), whether or not such Covered Taxes were
correctly or legally asserted. Such indemnification shall be made within 30
days of the demand of the Lender or Agent therefor. In addition, if the
Borrower fails to remit to the Administrative Agent, for the account of the
respective Lenders, the required receipts or other required documentary evidence
of its payment of any Taxes, the Borrower shall indemnify the Lenders for any
incremental Taxes, interest or penalties that may become payable by any Lender
as a result of any such failure. For purposes of this Section 4.6, the transfer
-----------
by the Administrative Agent or any Lender to or for the account of any Lender of
any sum received from the Borrower on account of amounts required to be paid by
the Borrower hereunder in respect of Covered Taxes imposed with respect to the
recipient shall be deemed a payment by the Borrower of such amounts.
-52-
(b) Each Lender that is an original signatory to this Agreement and each
Agent hereby severally (but not jointly) represent that, under applicable law
and treaties in effect as of the date of the initial Credit Extension, no United
States federal income taxes will be required to be withheld by the
Administrative Agent or the Borrower with respect to any payments to be made to
such Person in respect of this Agreement. Each Lender that is an original
signatory hereto (and each Person which becomes a Lender by assignment, transfer
or participation pursuant to Section 10.11 hereof) and each Agent (and each
-------------
Person that becomes an Agent by appointment pursuant to Section 9.4 hereof),
-----------
agrees severally (but not jointly) that, on or prior to the date of the initial
Credit Extension (or such assignment, transfer or appointment, as the case may
be) it will in each case deliver to the Borrower and the Administrative Agent
the following:
(i) in the case of a Person other than a Non-U.S. Lender, two copies
of a statement certifying that such Person is a U.S. Person, which
statement shall contain the address, if any, of such Person's office or
place of business in the United States, and shall be signed by an
authorized officer of such Person, together with two duly completed copies
of United States Internal Revenue Service Form W-9 (or applicable successor
form) (unless it establishes to the reasonable satisfaction of the Borrower
that it is otherwise eligible for an exemption from backup withholding tax
or other applicable withholding tax), or
(ii) in the case of a Non-U.S. Lender, either (A) two duly completed
copies of United States Internal Revenue Service Form 1001 or 4224 (or
applicable successor form) certifying in each case that such Person is
entitled to receive payments under this Agreement and the Notes payable to
it without deduction or withholding of any United States federal income
taxes and two duly completed copies of United States Internal Revenue
Service Form W-8 or Form W-9 (or applicable successor form) or (B) in the
case of an assignee Lender that is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and that does not comply with the
requirements of clause (i) hereof, then a statement in substantially the
form of Exhibit N hereto (an "Exemption Certificate") to the effect that
--------- ---------------------
such assignee Lender is eligible for a complete exemption from withholding
of United States withholding tax under Section 871(h) or Section 881(c) of
the Code and two duly completed and signed original copies of Internal
Revenue Service Form W-8.
Each Person who delivers to the Borrower and the Administrative Agent a Form W-
8, W-9, 1001 or 4224, or applicable successor form, pursuant to this clause,
further undertakes to deliver to
-53-
the Borrower and the Administrative Agent two further copies of said Form W-8,
W-9, 1001, 4224, or applicable successor form, or other manner of certification,
as the case may be, on or before the date that any such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower, and such extensions or
renewals thereof as may reasonably be requested by the Borrower, certifying that
such Person is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless in
any such case any change in law, rule, regulation, treaty or directive, or in
the interpretation or application thereof (a "Law Change"), has occurred prior
----------
to the date on which any such delivery would otherwise be required, which Law
Change renders any such form inapplicable or which would prevent such Person
from duly completing and delivering any such form with respect to it.
(c) The agreements in this Section shall survive the termination of this
Agreement and the payment of the Notes and all other amounts payable hereunder.
(d) No Lender shall be given the benefit of the provisions of clause (a)
----------
above during such time that such Lender has failed to comply with clause (b)
----------
above.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
---------------------------
provided, all payments by the Borrower pursuant to this Agreement, the Notes,
each Letter of Credit or any other Loan Document shall be made by the Borrower
to the Administrative Agent for the pro rata account of the Lenders entitled to
--- ----
receive such payment. All such payments required to be made to the
Administrative Agent shall be made, without setoff, deduction or counterclaim,
not later than 12:00 noon, New York City time, on the date due, in same day or
immediately available funds, to such account as the Administrative Agent shall
specify from time to time by notice to the Borrower. The failure of the
Borrower to make any such payment by such time shall not constitute a Default
hereunder, provided that such payment is received by the Administrative Agent in
immediately available funds by 4:00 p.m. on such due date, but any such payment
made after 1:00 p.m. on such due date shall be deemed to have been made on the
next Business Day for the purpose of calculating interest on amounts outstanding
on the Obligations unless the Administrative Agent in fact was able to remit to
each Lender its pro-rata share of such payment by 4:00 p.m. on such due date.
Funds received after that time shall be deemed to have been received by the
Administrative Agent on the next succeeding Business Day. The Administrative
Agent shall promptly remit in same day funds to each Lender its share, if any,
of such payments received by the Administrative Agent for the account of such
Lender. All interest (including interest on LIBO Rate Loans) shall be computed
on the basis of
-54-
the actual number of days (including the first day but excluding the last day)
occurring during the period for which such interest or fee is payable over a
year comprised of 360 days (or, in the case of interest on a Base Rate Loan
(calculated at other than the Federal Funds Rate) and fees, 365 days or, if
appropriate, 366 days). Whenever any payment to be made shall otherwise be due
on a day which is not a Business Day, such payment shall (except as otherwise
required by clause (c) of the definition of the term "Interest Period") be made
----------
on the next succeeding Business Day and such extension of time shall be included
in computing interest and fees, if any, in connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall obtain any payment
-------------------
or other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan or Reimbursement Obligation (other than
pursuant to the terms of Section 4.3, 4.4, 4.5 or 4.6) in excess of its pro rata
----------- --- --- --- --- ----
share of payments then or therewith obtained by all Lenders, such Lender shall
purchase from the other Lenders such participations in Credit Extensions made by
them as shall be necessary to cause such purchasing Lender to share the excess
payment or other recovery ratably with each of them; provided, however, that if
-------- -------
all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Lender, the purchase shall be rescinded and each
Lender which has sold a participation to the purchasing Lender shall repay to
the purchasing Lender the purchase price to the ratable extent of such recovery
together with an amount equal to such selling Lender's ratable share (according
to the proportion of
(a) the amount of such selling Lender's required repayment to the
purchasing Lender
to
--
(b) total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing Lender in
respect of the total amount so recovered. The Borrower agrees that any Lender
so purchasing a participation from another Lender pursuant to this Section may,
to the fullest extent permitted by law, exercise all its rights of payment
(including pursuant to Section 4.9) with respect to such participation as fully
-----------
as if such Lender were the direct creditor of the Borrower in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law, any Lender receives a secured claim in lieu of a setoff to which this
Section applies, such Lender shall, to the extent practicable, exercise its
rights in respect of such secured claim in a manner
-55-
consistent with the rights of the Lenders entitled under this Section to share
in the benefits of any recovery on such secured claim.
SECTION 4.9. Setoff. Each Lender shall, upon the occurrence and during
------
the continuance of any Default described in clauses (a) through (d) of Section
----------- --- -------
8.1.9 or, with the consent of the Required Lenders, upon the occurrence and
-----
during the continuance of any other Event of Default, have the right to
appropriate and apply to the payment of the Obligations owing to it (whether or
not then due), and (as security for such Obligations) the Borrower hereby grants
to each Lender a continuing security interest in, any and all balances, credits,
deposits, accounts or moneys of the Borrower then or thereafter maintained with
such Lender; provided, however, that any such appropriation and application
-------- -------
shall be subject to the provisions of Section 4.8. Each Lender agrees promptly
-----------
to notify the Borrower and the Administrative Agent after any such setoff and
application made by such Lender; provided, however, that the failure to give
-------- -------
such notice shall not affect the validity of such setoff and application. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff under applicable law or otherwise)
which such Lender may have.
SECTION 4.10. Lender's Duty to Mitigate. Each Lender, as promptly as
-------------------------
practicable after it becomes aware of the occurrence of an event or the
existence of a condition that would cause it to be affected under Section 4.1,
-----------
4.2, 4.3, 4.5 or 4.6 or that would entitle such Lender to receive payments under
--- --- --- ---
Section 4.3, will give notice thereof to the Borrower and the Administrative
-----------
Agent and, to the extent not inconsistent with such Lender's internal policies,
such Lender shall use commercially reasonable efforts to make, fund or maintain
its affected LIBO Rate Loans through another lending office of such Lender if,
as a result thereof, the additional moneys which would otherwise be required to
be paid to such Lender pursuant to Section 4.2, 4.3, 4.5 or 4.6, as the case may
----------- --- --- ---
be, would be materially reduced, or the illegality or other adverse
circumstances which would otherwise require a conversion of such Loans pursuant
to Section 4.1 would cease to exist, and if, as determined by such Lender in its
-----------
reasonable discretion, the making, funding or maintaining of such Loans through
such other lending office would not otherwise adversely affect such Loans or
such Lender.
SECTION 4.11. Replacement of Lenders. Each Lender hereby severally agrees
----------------------
as set forth in this Section:
(a) If any Lender (a "Subject Lender") makes demand upon the Borrower
--------------
for (or if the Borrower is otherwise required to pay) amounts pursuant to
Section 4.2, 4.3, 4.5
----------- --- ---
-56-
or 4.6, or gives notice pursuant to Section 4.1 requiring a conversion of
--- -----------
such Subject Lender's LIBO Rate Loans to Base Rate Loans, the Borrower may,
within 90 days of receipt by the Borrower of such demand or notice (or the
occurrence of such other event causing the Borrower to be required to pay
such compensation), as the case may be, give notice (a "Replacement
-----------
Notice") in writing to the Administrative Agent and such Subject Lender of
------
its intention to replace such Subject Lender with a financial institution
designated in such Replacement Notice. If the Administrative Agent shall,
in the exercise of its reasonable discretion and within 30 days of its
receipt of such Replacement Notice, notify the Borrower and such Subject
Lender in writing that the designated financial institution is satisfactory
to the Administrative Agent, then such Subject Lender shall, so long as no
Default shall have occurred and be continuing (and subject to the payment
of any amounts due pursuant to Section 4.4), assign, in accordance with
-----------
Section 10.11.1, all of its Commitments, Loans, Notes and other rights and
---------------
obligations under this Agreement and all other Loan Documents (including,
without limitation, Reimbursement Obligations) to such designated financial
institution; provided, however, that (i) such assignment shall be without
-------- -------
recourse, representation or warranty (other than that such Lender owns the
Commitments, Loans and Notes being assigned, free and clear of any Liens)
and shall be on terms and conditions reasonably satisfactory to such
Subject Lender and such designated financial institution and (ii) the
purchase price paid by such designated financial institution shall be in
the amount of such Subject Lender's Loans and its Percentage of outstanding
Reimbursement Obligations, together with all accrued and unpaid interest
and fees in respect thereof, plus all other amounts (other than the amounts
demanded and unreimbursed under Sections 4.2, 4.3, 4.5 and 4.6, which shall
------------ --- --- ---
be payable upon demand by the Borrower), owing to such Subject Lender
hereunder.
(b) Upon the effective date of an assignment described in clause (a),
----------
the Borrower shall issue a replacement Note or Notes, as the case may be,
to such designated financial institution or Replacement Lender, as
applicable, and such institution shall become a "Lender" for all purposes
under this Agreement and the other Loan Documents. In the case of clause
------
(a), the Administrative Agent agrees to use all commercially reasonable
---
efforts to assist the Borrower in locating a replacement financial
institution to replace any Subject Lender; provided, however, that the
-------- -------
Borrower agrees to pay all reasonable costs and expenses incurred by the
Administrative Agent in providing such assistance.
-57-
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of the Lenders
------------------------
and, if applicable, the Issuer to fund or make, as the case may be, the initial
Credit Extension shall be subject to the prior or concurrent satisfaction of
each of the conditions precedent set forth in this Section 5.1.
-----------
SECTION 5.1.1. Resolutions, etc. The Arranging Agents shall have received
----------------
from the Borrower and each other Obligor, as applicable, (i) a copy of a good
standing certificate, dated a date reasonably close to the Effective Date, for
each such Person and (ii) a certificate, dated the date of the initial Credit
Extension and with counterparts for each Lender, duly executed and delivered by
such Person's Secretary or Assistant Secretary, as to
(a) resolutions of each such Person's Board of Directors or consent
of its managing member then in full force and effect authorizing, to the
extent relevant, the execution, delivery and performance of this Agreement,
the Notes, each other Loan Document to be executed by such Person and the
transactions contemplated hereby and thereby;
(b) the incumbency and signatures of those of its officers or
managing members authorized to act with respect to this Agreement, the
Notes and each other Loan Document to be executed by such Person; and
(c) the full force and validity of each Organic Document of such
Person and copies thereof,
upon which certificates each Lender may conclusively rely until it shall have
received a further certificate of the Secretary, Assistant Secretary or managing
member of any such Person canceling or amending the prior certificate of such
Person.
SECTION 5.1.2. Delivery of Notes. The Arranging Agents shall have
-----------------
received such Lender's Notes duly executed and delivered by an Authorized
Officer of the Borrower.
SECTION 5.1.3. Delivery of Certain Documents. The Arranging Agents shall
-----------------------------
have received a fully executed copy of each of the Transaction Documents. There
shall not have been any amendments, waivers or other modifications of, or other
forbearance to exercise any rights with respect to, any of the terms or
provisions of any Transaction Document and the exhibits and schedules thereto.
-58-
SECTION 5.1.4. Payment of Outstanding Indebtedness, etc. All Indebtedness
----------------------------------------
identified in Item 7.2.2(b) ("Indebtedness to be Paid") of the Disclosure
-------------
Schedule, together with all interest, all prepayment premiums and other amounts
due and payable with respect thereto, shall have been paid in full from the
proceeds of the initial Credit Extension and the commitments in respect of such
Indebtedness shall have been terminated, and all Liens securing payment of any
such Indebtedness shall have been released and the Arranging Agents shall have
received all Uniform Commercial Code Form UCC-3 termination statements or other
instruments as may be suitable or appropriate in connection therewith. The
Arranging Agents shall have received executed copies of "pay-off" letters with
respect thereto in form and substance satisfactory to the Arranging Agents.
SECTION 5.1.5. Borrower Pledge Agreement. The Arranging Agents shall have
-------------------------
received the Borrower Pledge Agreement, dated as of the date hereof, duly
executed and delivered by an Authorized Officer of the Borrower, together with
(a) certificates evidencing all of the issued and outstanding shares
of ResNet Holdco, which certificates shall be accompanied by undated stock
powers duly executed in blank, or, if any securities pledged pursuant to
the Borrower Pledge Agreement are uncertificated securities, confirmation
and evidence satisfactory to the Arranging Agents that the security
interest in such uncertificated securities has been transferred to and
perfected by the Administrative Agent for the benefit of the Secured
Parties in accordance with Section 8-313 and Section 8-321 of the U.C.C.,
and all laws otherwise applicable to the perfection of the pledge of such
shares; and
(b) all Pledged Notes (as defined in the Borrower Pledge Agreement),
if any, evidencing Indebtedness payable to the Borrower, duly endorsed to
the order of the Administrative Agent, together with Uniform Commercial
Code Financing Statements (or similar instruments) in respect of such
Pledged Notes executed by each payee of a Pledged Note to be filed in such
jurisdictions as the Arranging Agents may reasonably request.
The Arranging Agents and their counsel shall be satisfied that (a) the Lien
granted to the Administrative Agent, for the benefit of the Secured Parties, in
the collateral described above is a first priority (or local equivalent thereof)
security interest; and (b) no Lien exists on any of the collateral described
above other than the Lien created in favor of the Administrative Agent, for the
benefit of the Secured Parties, pursuant to the Borrower Pledge Agreement.
-59-
SECTION 5.1.6. Security Agreements. The Arranging Agents shall have
-------------------
received executed counterparts of the Borrower Security Agreement, dated as of
the date hereof, duly executed by the Borrower, together with
(a) executed copies of Uniform Commercial Code financing statements
(Form UCC-1), naming the Borrower as the debtor and the Administrative
Agent as the secured party, or other similar instruments or documents, to
be filed under the Uniform Commercial Code of all jurisdictions as may be
necessary or, in the opinion of the Arranging Agents, desirable to perfect
the security interests of the Administrative Agent pursuant to such
Security Agreement;
(b) executed copies of proper Uniform Commercial Code Form UCC-3
termination statements, if any, necessary to release all Liens and other
rights of any Person
(i) in any collateral described in such Security Agreement
previously granted by any Person, and
(ii) securing any of the Indebtedness identified in Item
----
7.2.2(b) ("Indebtedness to be Paid") of the Disclosure Schedule,
--------
together with such other Uniform Commercial Code Form UCC-3 termination
statements as the Arranging Agents may request from the Borrower; and
(c) certified copies of Uniform Commercial Code Requests for
Information or Copies (Form UCC-11), or a similar search report certified
by a party acceptable to the Arranging Agents, dated a date reasonably near
to the date of the initial Credit Extension, listing all effective
financing statements which name the Borrower or any Restricted Subsidiary
(or any predecessor thereto), as the case may be (under its present name
and any previous names), as the debtor and which are filed in the
jurisdictions in which filings were made pursuant to clause (a) above,
----------
together with copies of such financing statements (none of which (other
than those described in clause (a), if such Form UCC-11 or search report,
----------
as the case may be, is current enough to list such financing statements
described in clause (a)) shall cover any collateral described in such
----------
Security Agreement).
SECTION 5.1.7. Patent Security Agreements, Copyright Security Agreements
---------------------------------------------------------
and Trademark Security Agreements. The Arranging Agents shall have received
---------------------------------
each Patent Security Agreement, Copyright Security Agreement and Trademark
Security Agreement, as applicable, each dated as of the date of the
-60-
initial Credit Extension, duly executed and delivered by the Borrower.
SECTION 5.1.8. Concentration Account Agreement. The Arranging Agents
-------------------------------
shall have received the Concentration Account Agreement duly executed by the
concentration account bank, dated as of the date of the initial Credit
Extension, duly executed and delivered by such financial institution.
SECTION 5.1.9. Other Loan Documents. The Arranging Agents shall have
--------------------
received each of the Contract Assignment Agreement and each Consent and
Agreement, in each case dated the date of the initial Credit Extension and duly
executed and delivered by an Authorized Officer of the Borrower and such other
parties thereto.
SECTION 5.1.10. Subsidiary Guaranties. The Arranging Agents shall have
---------------------
received each Subsidiary Guaranty, each dated the date of the initial Credit
Extension, duly executed and delivered by an Authorized Officer of each
Subsidiary Guarantor.
SECTION 5.1.11. Financial Information, etc. The Arranging Agents shall
--------------------------
have received
(a) audited consolidated financial statements of the Borrower and its
Subsidiaries for the three-year period ending December 31, 1995;
(b) unaudited financial statements of the Borrower and its
Subsidiaries for the six- and nine-month periods ending June 30, 1996 and
September 30, 1996; and
(c) pro forma consolidated and consolidating balance sheets of the
--- -----
Borrower and its Subsidiaries, as of September 30, 1996 (the "Pro Forma
---------
Balance Sheet"), in each case, certified by the chief financial or
-------------
accounting Authorized Officer of the Borrower, giving effect to the
consummation of all the transactions contemplated by this Agreement and
reflecting the resulting capital structure (debt and equity) of the
Borrower, which shall be satisfactory to the Arranging Agents.
SECTION 5.1.12. Closing Date Certificate. The Arranging Agents shall have
------------------------
received the Borrower Closing Date Certificate, dated the date of the initial
Credit Extension, duly executed and delivered by an Authorized Officer of the
Borrower, in which certificate the Borrower shall agree and acknowledge that the
statements made therein shall be deemed to be true and correct representations
and warranties of the Borrower made as of such date and, at the time each such
certificate is delivered, such statements shall in fact be true and correct.
All documents and
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agreements required to be appended to the Borrower Closing Date Certificate
shall be in form and substance satisfactory to the Arranging Agents.
SECTION 5.1.13. Compliance Certificate. The Arranging Agents shall have
----------------------
received an initial Compliance Certificate on a pro forma basis as if the Credit
--- -----
Extension to be made on the date of the initial Credit Extension had occurred as
of September 30, 1996 and as to such items therein as the Arranging Agents
reasonably request, dated the date of the initial Credit Extension, duly
executed (and with all schedules thereto duly completed) and delivered by the
chief executive, financial or accounting Authorized Officer of the Borrower.
SECTION 5.1.14. Solvency, etc. The Arranging Agents shall have received
-------------
the Solvency Certificate, dated the date of the initial Credit Extension, duly
executed and delivered by the chief financial or accounting Authorized Officer
of the Borrower.
SECTION 5.1.15. Insurance. The Arranging Agents shall have received
---------
certified copies of the insurance policies (or binders or certificates of
insurance in respect thereof), from one or more insurance companies satisfactory
to the Arranging Agents, evidencing coverage required to be maintained pursuant
hereto and each Loan Document.
SECTION 5.1.16. Opinions of Counsel. The Arranging Agents shall have
-------------------
received opinions, dated the date of the initial Credit Extension and addressed
to the Agents and all Lenders, from ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.C., special counsel to
the Obligors, in the form of Exhibit O hereto.
---------
SECTION 5.1.17. Closing Fees, Expenses, etc. The Agents shall have
---------------------------
received for their own accounts, or for the account of each Lender, as the case
may be, all fees, costs and expenses due and payable pursuant to Section 3.3, if
-----------
then invoiced.
SECTION 5.2. All Credit Extensions. The obligation of each Lender and
---------------------
each Issuer to make any Credit Extension (including the initial Credit
Extension) shall be subject to Sections 2.1.4 and 2.1.5 and the satisfaction of
-------------- -----
each of the conditions precedent set forth in this Section 5.2.
-----------
SECTION 5.2.1. Compliance with Warranties, No Default, etc. Both before
-------------------------------------------
and after giving effect to any Credit Extension (but, if any Default of the
nature referred to in Section 8.1.5 shall have occurred with respect to any
-------------
other Indebtedness, without giving effect to the application, directly or
indirectly, of the proceeds thereof) the following statements shall be true and
correct:
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(a) the representations and warranties set forth in Article VI
----------
(excluding, however, those contained in Section 6.7) and in each other Loan
-----------
Document shall, in each case, be true and correct with the same effect as
if then made (unless stated to relate solely to an earlier date, in which
case such representations and warranties shall be true and correct in all
material respects as of such earlier date);
(b) except as disclosed by the Borrower to the Administrative Agent
and the Lenders pursuant to Section 6.7,
-----------
(i) no labor controversy, litigation, arbitration or
governmental investigation or proceeding shall be pending or, to the
knowledge of the Borrower, threatened against the Borrower or any of
its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect; and
(ii) no development shall have occurred in any labor
controversy, litigation, arbitration or governmental investigation or
proceeding disclosed pursuant to Section 6.7 which could reasonably be
-----------
expected to have a Material Adverse Effect; and
(c) no Default shall have then occurred and be continuing.
SECTION 5.2.2. Credit Extension Request, etc. The Administrative Agent
-----------------------------
shall have received a Borrowing Request if Loans are being requested, or an
Issuance Request if a Letter of Credit is being requested or extended. Each of
the delivery of a Borrowing Request or Issuance Request and the acceptance by
the Borrower of the proceeds of such Credit Extension shall constitute a
representation and warranty by the Borrower that on the date of such Credit
Extension (both immediately before and after giving effect to such Credit
Extension and the application of the proceeds thereof) the statements made in
Section 5.2.1 are true and correct in all material respects.
-------------
SECTION 5.2.3. Satisfactory Legal Form. All documents executed or
-----------------------
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be reasonably satisfactory in form and
substance to the Arranging Agents and their counsel; the Arranging Agents and
their counsel shall have received all information, approvals, opinions,
documents or instruments as the Arranging Agents or their counsel may reasonably
request.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders, each Issuer and each Agent to enter into
this Agreement and to make Credit Extensions hereunder, the Borrower represents
and warrants unto each Agent, each Issuer and each Lender as set forth in this
Article VI.
----------
SECTION 6.1. Organization, etc. The Borrower and each of its Subsidiaries
-----------------
is a corporation validly organized and existing and in good standing under the
laws of the state or jurisdiction of its incorporation, is duly qualified to do
business and is in good standing as a foreign corporation in each jurisdiction
where the nature of its business requires such qualification, and has full power
and authority and holds all requisite governmental licenses, permits and other
approvals to enter into and perform its Obligations under this Agreement, the
Notes and each other Loan Document and Transaction Document to which it is a
party and to own and hold under lease its property and to conduct its business
substantially as currently conducted by it.
SECTION 6.2. Due Authorization, Non-Contravention, etc. The execution,
-----------------------------------------
delivery and performance by the Borrower of this Agreement, the Notes and each
other Loan Document and Transaction Document executed or to be executed by it
and the execution, delivery and performance by each other Obligor of each Loan
Document and Transaction Document executed or to be executed by it are in each
case within each such Person's corporate powers, have been duly authorized by
all necessary corporate action, and do not
(a) contravene any such Person's Organic Documents;
(b) contravene any Contractual Obligation binding on or affecting any
such Person;
(c) contravene any Governmental Approval or Governmental Rule binding
on or affecting any such Person; or
(d) result in, or require the creation or imposition of, any Lien on
any of such Person's properties (except as expressly permitted by this
Agreement).
SECTION 6.3. Government Approval, Regulation, etc. Except as disclosed in
------------------------------------
Item 6.3 ("Approvals") of the Disclosure Schedule, no authorization or approval
--------
or other action by, and no notice to or filing with, any Regulatory Authority or
other Person (other than those that have been, or on the Effective Date will be,
duly obtained or made and which are, or on the Effective
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Date will be, in full force and effect) is required for the due execution,
delivery or performance by the Borrower of this Agreement or the Notes or by the
Borrower or any other Obligor of any other Loan Document or Transaction Document
to which it is a party. Neither the Borrower nor any of its Subsidiaries is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, or a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or a "subsidiary company" of
a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
SECTION 6.4. Validity, etc. This Agreement constitutes, and the Notes and
-------------
each other Loan Document and Transaction Document, executed by the Borrower
will, on the due execution and delivery thereof, constitute, the legal, valid
and binding obligations of the Borrower, enforceable against the Borrower in
accordance with their respective terms; and each other Loan Document and
Transaction Document executed pursuant hereto by each other Obligor will, on the
due execution and delivery thereof by such Obligor, constitute the legal, valid
and binding obligation of such Obligor enforceable against such Obligor in
accordance with its terms (except, in any case above, as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally and by principles of equity).
SECTION 6.5. Financial Information. The financial statements of the
---------------------
Borrower and its Subsidiaries furnished to the Arranging Agents and each Lender
pursuant to Section 5.1.11 have been prepared in accordance with GAAP
--------------
consistently applied, and present fairly the consolidated financial position of
the corporations covered thereby as at the dates thereof and the results of
their operations for the periods then ended. All balance sheets, all statements
of operations, shareholders' equity and cash flows and all other financial
information of each of the Borrower and its Subsidiaries furnished pursuant to
Section 7.1.1 have been and will for periods following the Effective Date be
-------------
prepared in accordance with GAAP consistently applied, and do or will present
fairly the consolidated financial position of the corporations covered thereby
as at the dates thereof and the results of their operations for the periods then
ended, except that quarterly financial statements need not include footnote
disclosure and may be subject to ordinary year-end adjustment.
SECTION 6.6. No Material Adverse Effect. There has been no Material
--------------------------
Adverse Effect since December 31, 1995 or June 30, 1996.
SECTION 6.7. Litigation, Labor Controversies, etc. Except as disclosed in
------------------------------------
Item 6.7 ("Litigation") of the Disclosure
--------
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Schedule, there is no pending or, to the knowledge of the Borrower, threatened
litigation, action, proceeding, or labor controversy affecting the Borrower or
any of its Subsidiaries, or any of their respective properties, businesses,
assets or revenues, which (a) could have a Material Adverse Effect or (b) could
adversely affect the legality, validity or enforceability of this Agreement, the
Notes or any other Loan Document or Transaction Document.
SECTION 6.8. Compliance with Laws. The Borrower and its Subsidiaries have
--------------------
complied in all material respects with all applicable Governmental Approvals and
Governmental Rules of any Regulatory Authority having jurisdiction over the
conduct of its businesses or the ownership of its properties.
SECTION 6.9. Subsidiaries. The Borrower has no Subsidiaries, except those
------------
Subsidiaries
(a) which are identified in Item 6.9 ("Existing Subsidiaries") of the
--------
Disclosure Schedule; or
(b) which are permitted to have been organized or acquired in
accordance with Section 7.2.5 or 7.2.10.
------------- ------
SECTION 6.10. Ownership of Properties. Except as permitted pursuant to
-----------------------
Section 6.14 or Section 7.2.3, the Borrower and each of its Subsidiaries owns
------------ -------------
(a) in the case of owned real property, good and marketable fee title to, and
(b) in the case of owned personal property, good and valid title to, or, in the
case of leased real or personal property, valid and enforceable leasehold
interests (as the case may be) in, all of its properties and assets, real and
personal, tangible and intangible, of any nature whatsoever, free and clear in
each case of all Liens or claims, except for Liens permitted pursuant to Section
-------
7.2.3.
-----
SECTION 6.11. Taxes. The Borrower and each of its Subsidiaries has filed
-----
all tax returns and reports required by law to have been filed by it and has
paid all taxes and governmental charges thereby shown to be due and owing,
except any such taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 6.12. Pension and Welfare Plans. During the twelve-consecutive-
-------------------------
month period prior to the date of the execution and delivery of this Agreement
and prior to the date of any Credit Extension hereunder, no steps have been
taken to terminate any Pension Plan (other than a standard termination under
Section 4041(b) of ERISA), and no contribution failure has occurred with respect
to any Pension Plan sufficient to give rise
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to a Lien under Section 302(f) of ERISA. No condition exists or event or
transaction has occurred with respect to any Pension Plan which might result in
the incurrence by the Borrower or any member of the Controlled Group of any
material liability, fine or penalty.
SECTION 6.13. Environmental Warranties. Except as set forth in Item 6.13
------------------------ ---------
("Environmental Matters") of the Disclosure Schedule:
(a) all facilities and property (including underlying groundwater)
owned or leased by the Borrower or any of its Subsidiaries have been, and
continue to be, owned or leased by the Borrower and its Subsidiaries in
material compliance with all Environmental Laws;
(b) there are no pending or threatened and, to the best of the
Borrower's knowledge, there have been no past
(i) claims, complaints, notices or requests for information
received by the Borrower or any of its Subsidiaries with respect to
any alleged violation of any Environmental Law, or
(ii) complaints, notices or inquiries to the Borrower or any of
its Subsidiaries regarding potential liability under any Environmental
Law;
(c) there have been no Releases of Hazardous Materials at, on or
under any property now or previously owned or leased by the Borrower or any
of its Subsidiaries that, singly or in the aggregate, have, or could
reasonably be expected to have, a Material Adverse Effect;
(d) the Borrower and its Subsidiaries have been issued and are in
material compliance with all permits, certificates, approvals, licenses and
other authorizations relating to environmental matters and necessary or
desirable for their businesses;
(e) no property now or previously owned or leased by the Borrower or
any of its Subsidiaries is listed or proposed for listing on the National
Priorities List pursuant to CERCLA, on the CERCLIS or on any similar state
list of sites requiring investigation or clean-up;
(f) there are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or
previously owned or leased by the Borrower or any of its Subsidiaries that,
singly or in the
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aggregate, have, or could reasonably be expected to have, a Material
Adverse Effect;
(g) neither the Borrower nor any Subsidiary of the Borrower has
directly transported or directly arranged for the transportation of any
Hazardous Material to any location which is listed or proposed for listing
on the National Priorities List pursuant to CERCLA, on the CERCLIS or on
any similar state list or which is the subject of federal, state or local
enforcement actions or other investigations which may lead to material
claims against the Borrower or such Subsidiary thereof for any remedial
work, damage to natural resources or personal injury, including claims
under CERCLA;
(h) there are no polychlorinated biphenyls or friable asbestos present
at any property now or previously owned or leased by the Borrower or any
Subsidiary of the Borrower that, singly or in the aggregate, have, or could
reasonably be expected to have, a Material Adverse Effect; and
(i) no conditions exist at, on or under any property now or previously
owned or leased by the Borrower which, with the passage of time, or the
giving of notice or both, would give rise to liability under any
Environmental Law.
SECTION 6.14. Intellectual Property. Each of the Borrower and its
---------------------
Subsidiaries owns and possesses or licenses (as the case may be) all such
patents, patent rights, trademarks, trademark rights, trade names, trade name
rights, service marks, service ▇▇▇▇ rights and copyrights necessary for the
conduct of the businesses of the Borrower and its Subsidiaries as now conducted
without, individually or in the aggregate, any infringement upon rights of other
Persons, in each case except as could not reasonably be expected to result in a
Material Adverse Effect, and there is no individual patent, patent right,
trademark, trademark right, trade name, trade name right, service ▇▇▇▇, service
▇▇▇▇ right or copyright the loss of which could reasonably be expected to have a
Material Adverse Effect, except as may be disclosed in Item 6.14 ("Intellectual
---------
Property") of the Disclosure Schedule.
SECTION 6.15. Regulations G, U and X. Neither the Borrower nor any of its
----------------------
Subsidiaries is engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock, and no proceeds of any Credit Extensions
will be used to purchase or carry margin stock or otherwise for a purpose which
violates, or would be inconsistent with, F.R.S. Board Regulation G, U or X.
Terms for which meanings are provided in F.R.S. Board Regulation G, U or X or
any regulations substituted therefor, as from time to time in effect, are used
in this Section with such meanings.
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SECTION 6.16. Accuracy of Information. None of the factual information
-----------------------
heretofore or contemporaneously furnished by or on behalf of the Borrower in
writing to any Agent, any Issuer or any Lender for purposes of or in connection
with this Agreement or any transaction contemplated hereby (true and complete
copies of which were furnished to each Arranging Agent, the Issuer and each
Lender in connection with its execution and delivery hereof), contains any
untrue statement of a material fact on the date as of which such information is
dated or certified, and none of the other factual information hereafter
furnished in connection with this Agreement or any other Loan Document or any
Transaction Document by the Borrower or any other Obligor to any Agent, any
Issuer or any Lender will contain any untrue statement of a material fact on the
date as of which such information is dated or certified and, as of the date of
the execution and delivery of this Agreement by each Arranging Agent and each
Lender, the information delivered prior to the date of execution and delivery of
this Agreement (unless such information specifically relates to a prior date)
does not, and the factual information hereafter furnished shall not on the date
as of which such information is dated or certified, omit to state any material
fact necessary to make any information not misleading.
SECTION 6.17. Primestar Partnership Agreement. Neither the Borrower
-------------------------------
nor any Subsidiary is in default of its obligations under the Primestar
Partnership Agreement and no fact, circumstance or event has occurred or is
reasonably likely to occur that would give rise to a termination of the
Primestar Partnership Agreement or to cause the Borrower or any of its
Subsidiaries to divest its interest in Primestar.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees with each Agent,
---------------------
each Issuer and each Lender that, until all Commitments have terminated and all
Obligations have been paid and performed in full, the Borrower will perform or
cause to be performed the obligations set forth in this Section 7.1.
-----------
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The Borrower
--------------------------------------------
will furnish, or will cause to be furnished, to each Lender, each Issuer and
each Agent copies of the following financial statements, reports, notices and
information:
(a) as soon as available and in any event within 45 days (and 60
days, in the case of the Borrower and its Restricted Subsidiaries) after
the end of each of the first three Fiscal Quarters of each Fiscal Year of
the Borrower, a
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consolidated balance sheet of the Borrower and its Restricted Subsidiaries
and a consolidated balance sheet of the Borrower and its Subsidiaries, in
each case as of the end of such Fiscal Quarter and consolidated statements
of earnings and cash flows of the Borrower and its Restricted Subsidiaries
and consolidated statements of earnings and cash flows of the Borrower and
its Subsidiaries, in each case for the period commencing at the end of the
previous Fiscal Year and ending with the end of such Fiscal Quarter and a
profit and loss statement for such Fiscal Quarter, certified as complete
and correct by the chief financial Authorized Officer of the Borrower;
(b) as soon as available and in any event within 90 days (and 105
days, in the case of the Borrower and its Restricted Subsidiaries) after
the end of each Fiscal Year of the Borrower, a copy of the annual audited
financial statements for such Fiscal Year for the Borrower and its
consolidated Subsidiaries, including therein a consolidated balance sheet
of the Borrower and its Restricted Subsidiaries as of the end of such
Fiscal Year and consolidated statements of earnings and cash flow of the
Borrower and its Restricted Subsidiaries for such Fiscal Year, in each case
as audited (without any Impermissible Qualification) by KPMG Peat Marwick
or independent public accountants of national standing acceptable to the
Arranging Agents;
(c) as soon as available and in any event within 60 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year of the
Borrower and within 105 days after the end of the Fiscal Year of the
Borrower, a Compliance Certificate, executed by the chief executive,
financial or accounting Authorized Officer of the Borrower, showing (in
reasonable detail and with appropriate calculations and computations in all
respects reasonably satisfactory to the Arranging Agents) compliance with
the financial covenants set forth in Article VII;
-----------
(d) as soon as possible and in any event within three Business Days
after the Borrower or any of its Subsidiaries obtains knowledge of the
occurrence of a Default, a statement of the chief executive, financial or
accounting Authorized Officer of the Borrower setting forth details of such
Default and the action which the Borrower has taken and proposes to take
with respect thereto;
(e) as soon as possible and in any event within three Business Days
after the Borrower or any of its Subsidiaries obtains knowledge of (x) the
occurrence of any material adverse development with respect to any
litigation, action,
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proceeding or labor controversy of the type and materiality described in
Item 6.7 ("Litigation") of the Disclosure Schedule, or (y) the commencement
--------
of any litigation, action, proceeding or labor controversy of the type and
materiality described in Item 6.7 ("Litigation") of the Disclosure
--------
Schedule, notice thereof and, to the extent the Arranging Agents reasonably
request, copies of all documentation relating thereto;
(f) promptly after the sending or filing thereof, copies of all
reports and registration statements which the Borrower or any of its
Subsidiaries files with the SEC or any national securities exchange;
(g) immediately upon becoming aware of (i) the institution of any
steps by the Borrower or any other Person to terminate any Pension Plan
(other than a standard termination under Section 4041(b) of ERISA), (ii)
the failure to make a required contribution to any Pension Plan if such
failure is sufficient to give rise to a Lien under Section 302(f) of ERISA,
(iii) the taking of any action with respect to a Pension Plan which would
result in the requirement that the Borrower furnish a bond or other
security to the PBGC or such Pension Plan, or (iv) the occurrence of any
event with respect to any Pension Plan which could reasonably be expected
to result in the incurrence by the Borrower of any material liability, fine
or penalty, notice thereof and copies of all documentation relating
thereto;
(h) promptly when available and in any event within 15 Business Days
after the last day of each Fiscal Year of the Borrower (commencing after
the Effective Date), a budget for the then current Fiscal Year of the
Borrower, which budget shall contain on a quarterly basis a projected
statement of earnings and sources and uses of funds of the Borrower and its
Restricted Subsidiaries, prepared in reasonable detail by the chief
accounting, financial or executive Authorized Officer of the Borrower; and
(i) such other information respecting the condition or operations,
financial or otherwise, of the Borrower or any of its Subsidiaries as any
Lender or any Issuer through the Administrative Agent may from time to time
reasonably request (including information and reports from the chief
accounting, financial or executive Authorized Officer of the Borrower, in
such detail as any Arranging Agent or any Lender or Issuer through the
Administrative Agent may reasonably request, with respect to the terms of
and information provided pursuant to the Compliance Certificate).
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SECTION 7.1.2. Compliance with Laws, etc. The Borrower will, and will
-------------------------
cause each of its Subsidiaries to, comply in all material respects with all
applicable Governmental Rules and Governmental Approvals of all Regulatory
Authorities, such compliance to include:
(a) the maintenance and preservation of the Borrower's and its
Subsidiaries' corporate existence; and
(b) the payment, before the same become delinquent, of all taxes,
assessments and governmental charges imposed upon it or upon its property
except to the extent being diligently contested in good faith by
appropriate proceedings and for which adequate reserves, if any, in
accordance with GAAP shall have been set aside on its books.
SECTION 7.1.3. Maintenance of Properties. The Borrower will, and will
-------------------------
cause each of its Subsidiaries to, maintain, preserve, protect and keep its
properties in good repair, working order and condition (ordinary wear and tear
excepted), and make necessary and proper repairs, renewals and replacements so
that its business carried on in connection therewith may be properly conducted
at all times unless the Borrower determines in good faith that the continued
maintenance of any of its properties is no longer economically desirable.
SECTION 7.1.4. Insurance. The Borrower shall maintain, and shall cause
---------
each of its Subsidiaries to maintain:
(a) physical damage insurance on all real and personal property on an
all-risk basis (including, loss in transit, flood and earthquake insurance)
and public liability insurance against claims for personal injury, death or
property damage suffered by others upon, in or about any premises occupied
by it or occurring as a result of its ownership, maintenance or operation
of any airplanes, automobiles, trucks or other vehicles or other facilities
(including any machinery used therein or thereupon) or as the result of the
use of products manufactured, constructed or sold by it or services
rendered by it in an amount as is usually carried by Persons of comparable
size engaged in the same or a similar business and similarly situated;
(b) such other types of insurance with respect to its business as is
usually carried by Persons of comparable size engaged in the same or a
similar business and similarly situated; and
(c) all worker's compensation or similar insurance as may be required
under the laws of any state or jurisdiction in which it may be engaged in
business.
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All insurance shall be provided (i) by insurers authorized by Lloyds of London
to underwrite such risks, (ii) by insurers having an A.M. Best policyholders
rating of not less than A-(except with respect to insurers providing insurance
of the type described in clause (c), in which case such insurers shall have an
----------
A.M. Best policyholders rating of not less than B+) or (iii) by such other
insurers as the Arranging Agents may approve in writing; provided, that if the
--------
rating of any of such insurers is downgraded, the Borrower and each of its
Subsidiaries, as the case may be, shall only be required to obtain replacement
insurance with an insurer satisfying the requirements of this clause at the
stated expiration of the insurance policy maintained with the insurer whose
rating was so downgraded.
SECTION 7.1.5. Books and Records. The Borrower will, and will cause each
-----------------
of its Subsidiaries to, keep books and records which accurately reflect all of
its business affairs and transactions and permit the Agent and each Lender or
any of their respective representatives, at reasonable times and intervals, to
visit all of its offices, to discuss its financial matters with its officers and
independent public accountant (and the Borrower hereby authorizes such
independent public accountant to discuss the Borrower's financial matters with
each Lender or its representatives whether or not any representative of the
Borrower is present) and to examine (and, at the expense of the Borrower,
photocopy extracts from) any of its books or other corporate records. The
Borrower shall pay any fees of such independent public accountant incurred in
connection with any Agent's or any Lender's exercise of its rights pursuant to
this Section.
SECTION 7.1.6. Environmental Covenant. The Borrower will, and will cause
----------------------
each of its Subsidiaries to,
(a) use and operate all of its facilities and properties in material
compliance with all Environmental Laws, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material compliance with
all applicable Environmental Laws;
(b) promptly notify the Administrative Agent and provide copies upon
receipt of all written claims, complaints, notices or inquiries relating to
the condition of its facilities and properties in respect of, or as to
compliance with, Environmental Laws, and shall promptly resolve any non-
compliance with Environmental Laws and keep its property free of any Lien
imposed by any Environmental Law; and
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(c) provide such information and certifications which the Arranging
Agents may reasonably request from time to time to evidence compliance with
this Section 7.1.6.
-------------
SECTION 7.1.7. Future Subsidiaries. Upon any Person becoming, after the
-------------------
Effective Date, a Restricted Subsidiary of the Borrower, or upon the Borrower
directly or indirectly acquiring additional Capital Stock of any existing
Restricted Subsidiary having voting rights or contingent voting rights, the
Borrower shall notify the Administrative Agent of such acquisition, and, unless
otherwise agreed to among the Borrower, the Administrative Agent and the
Required Lenders,
(a) such Person shall execute and deliver to the Administrative Agent
(i) a Subsidiary Guaranty and (ii) if such Person is a Collateral
Subsidiary, the Subsidiary Security Agreement, in each case in a manner
satisfactory to the Administrative Agent; and
(b) the Borrower shall, pursuant to the Borrower Pledge agreement,
pledge to the Administrative Agent for its benefit and that of the Secured
Parties (i) all of the outstanding shares of Capital Stock of such Person,
along with undated stock powers for such certificates, executed in blank
(or, if any such shares of Capital Stock are uncertificated, confirmation
and evidence satisfactory to the Administrative Agent that the security
interest in such uncertificated securities has been transferred to and
perfected by the Administrative Agent, for the benefit of the Secured
Parties, in accordance with Section 8-313 and Section 8-321 of the U.C.C.
or any other similar or local or foreign law which may be applicable), and
(ii) all intercompany notes, if any, evidencing Indebtedness in favor of
the Borrower made by such Person (which shall, unless the Administrative
Agent shall otherwise agree, be in form satisfactory to the Administrative
Agent);
together, in each case, with such opinions of legal counsel for the Borrower
(which shall be from counsel reasonably satisfactory to the Administrative
Agent) relating thereto, which legal opinions shall be in form and substance
reasonably satisfactory to the Administrative Agent.
SECTION 7.1.8. Additional Collateral. (a) The Borrower shall, and shall
---------------------
cause each of its Collateral Subsidiaries to, cause the Administrative Agent, on
behalf of the Secured Parties, to have at all times a first priority perfected
security interest (subject only to Liens and encumbrances permitted under
Section 7.2.3) in all of the property (real and personal) owned from time to
-------------
time by the Borrower or such Collateral Subsidiary to the extent the same
constitutes or would constitute "Collateral"
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under the Borrower Security Agreement, the Subsidiary Security Agreement or the
Borrower Pledge Agreement. Without limiting the generality of the foregoing,
the Borrower shall, and shall cause each of its Collateral Subsidiaries to,
execute, deliver and/or file (as applicable) or cause to be executed, delivered
and/or filed (as applicable), the pledge agreement(s), the security
agreement(s), Uniform Commercial Code (Form UCC-1) financing statements, Uniform
Commercial Code (Form UCC-3) termination statements, and other documentation
necessary to grant and perfect such security interest, in each case in form and
substance satisfactory to the Administrative Agent together, in each case, with
such opinions of legal counsel for the Borrower (which shall be from counsel
reasonably satisfactory to the Administrative Agent) relating thereto, which
legal opinions shall be in form and substance reasonably satisfactory to the
Administrative Agent.
(b) The Borrower shall (i) cause each Restricted Subsidiary which has
assets (exclusive of assets owned by such Restricted Subsidiary on the Effective
Date) and/or in which the Borrower or any Subsidiary has made Investments
aggregating for all such assets and Investments (without duplication) $5,000,000
or more (valued at the greater of book and fair market value) to promptly (x)
execute a Subsidiary Security Agreement and (y) comply with the requirements of
clause (a) above, and (ii) cause Restricted Subsidiaries to promptly (x) execute
----------
a Subsidiary Security Agreement and (y) comply with the requirements of clause
------
(a) above so that the aggregate amount of all assets (exclusive of assets owned
---
by such Restricted Subsidiary on the Effective Date) owned by Restricted
Subsidiaries and/or in which the Borrower or any Subsidiary has made Investments
aggregating for all such assets and Investments (without duplication) not
subject to the Subsidiary Security Agreement does not exceed $10,000,000 (valued
at the greater of book and fair market value) in the aggregate at any time (each
Restricted Subsidiary described in the foregoing clauses (i) and (ii) being a
----------- ----
"Collateral Subsidiary").
----------------------
SECTION 7.1.9. Rate Protection Agreements. If at any time the one month
--------------------------
LIBO Rate shall be greater than or equal to 6.50% for a period of five
consecutive Business Days as determined by the Administrative Agent, the
Borrower shall, within 30 days of the end of such period, enter into interest
rate protection agreements in form and substance satisfactory to the Arranging
Agents for a minimum period of three years and in a notional principal amount
equal to at least the excess of (i) an amount equal to 50% of the aggregate
outstanding Total Debt over (ii) the aggregate principal amount of Indebtedness
which bears interest at a fixed rate for a period of at least three years from
the end of such period, and such rate protection agreements to be in all
respects satisfactory to the Arranging Agents.
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SECTION 7.1.10. Future Leased Property. The Borrower shall, and shall
----------------------
cause each of its Restricted Subsidiaries to, use its (and their) best efforts
to deliver to the Administrative Agent an estoppel letter in a form satisfactory
to the Administrative Agent executed by the lessor of any real property in the
U.S. that is leased by the Borrower or such Restricted Subsidiary for a term in
excess of one year, to the extent the value of any personal property to be held
at such leased property exceeds (or it is anticipated that the value of such
personal property will, during the term of such leasehold term, exceed)
$7,500,000.
SECTION 7.1.11. Use of Proceeds. The Borrower shall apply the proceeds of
---------------
the Credit Extensions solely
(a) for Capital Expenditures of the Borrower and the Restricted
Subsidiaries;
(b) for working capital and general corporate purposes of the
Borrower and the Restricted Subsidiaries;
(c) to pay the transaction costs and expenses incurred in connection
with the initial Credit Extension;
(d) to repay the Indebtedness identified in Item 7.2.2(b)
-------------
("Indebtedness to be Paid") of the Disclosure Schedule in an amount not to
exceed $255,000,000; and
(e) in the case of Letters of Credit, for issuing standby Letters of
Credit for the account of the Borrower to support obligations of the
Borrower and its Restricted Subsidiaries or to replace obligations under
the Indemnification Agreements which have been cancelled or otherwise
terminated.
SECTION 7.1.12. TCIC Credit Agreement. On or prior to January 15, 1997,
---------------------
the Borrower shall enter into an amendment with TCIC to the TCIC Credit
Agreement in form and substance satisfactory to the Arranging Agents providing
that, inter alia, (i) the Borrower may borrow under such facility without
----- ----
restrictions or conditions precedent (other than (x) the GE-E Satellite Event
has not occurred and (y) the then Available Amount has been fully utilized) in
an amount up to $100,000,000 in principal amount, (ii) there shall be no
affirmative or negative covenants contained therein, (iii) there shall be no
events of default other than, prior to the payment in full of the Obligations,
the bankruptcy of the Borrower, (iv) the payment of the Indebtedness thereunder
shall be fully subordinated to the prior payment in full of the Obligations, (v)
if an Event of Default has occurred and is continuing, the Administrative Agent
may make drawings thereunder on the Borrower's behalf to be
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applied to the payment of the Obligations and (vi) payment of the obligations
thereunder shall be permitted only upon a Permitted Refinancing or the payment
of interest upon meeting certain financial tests to be specified by the
Arranging Agents. Prior to the satisfaction of the condition precedent set
forth in the immediately preceding sentence, the Borrower will not incur or
suffer to exist any Indebtedness under the TCIC Credit Agreement.
SECTION 7.2. Negative Covenants. The Borrower agrees with the Agents,
------------------
each Issuer and each Lender that, until all Commitments have terminated and all
Obligations have been paid and performed in full, the Borrower will, and will
cause its Subsidiaries to, perform the obligations set forth in this Section
-------
7.2.
---
SECTION 7.2.1. Business Activities. The Borrower will not, and will not
-------------------
permit any of its Restricted Subsidiaries to, engage in any business activity,
except those described in the first recital and such activities as are
----- -------
reasonably incidental or substantially similar thereto. The Borrower will not
permit any Unrestricted Subsidiary to engage in any business other than the
business of the ownership, construction and financing of satellites to be owned
by or to be part of a sale-leaseback transaction with Tempo for the direct
broadcast satellite business and related activities incidental thereto. The
Borrower shall not and shall not permit any Subsidiary to engage in the High
Power Satellite Transmission Business except (i) with the prior written consent
of the Required Lenders and (ii) only through a High Power Satellite
Transmission Subsidiary.
SECTION 7.2.2. Indebtedness. The Borrower will not, and will not permit
------------
any of its Restricted Subsidiaries to, create, incur, assume or suffer to exist
or otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following:
(a) Indebtedness in respect of the Credit Extensions and other
Obligations (including Hedging Obligations in respect of such Credit
Extensions);
(b) (i) until the date of the initial Credit Extension, Indebtedness
identified in Item 7.2.2(b)(i) ("Indebtedness to be Paid") of the
----------------
Disclosure Schedule and (ii) Indebtedness identified in Item 7.2.2(b)(ii)
-----------------
("Ongoing Indebtedness") of the Disclosure Schedule;
(c) [Intentionally Omitted];
(d) Indebtedness of the Borrower in respect of (i) Capitalized Lease
Liabilities, (ii) Indebtedness the proceeds of which are used to acquire an
asset by the
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Borrower (or used to acquire such an asset within 60 days of the incurrence
thereof) and (iii) unsecured Indebtedness; provided, that the aggregate
--------
amount of all Indebtedness outstanding pursuant to this clause (d) at the
----------
time any of the same is created, assumed or incurred (together with the
principal amount of all other Indebtedness permitted under this clause (d))
----------
shall not at any time exceed $50,000,000 at such time after giving effect
thereto and any Permitted Refinancings thereof;
(e) Indebtedness of any Restricted Subsidiary owing to the Borrower
or any other Restricted Subsidiary or the Borrower to any Restricted
Subsidiary, which Indebtedness
(i) which if evidenced by one or more promissory notes are duly
delivered in pledge pursuant to the Borrower Pledge Agreement to the
Administrative Agent; and
(ii) shall not be forgiven or otherwise discharged for any
consideration other than payment in full or in part (provided that
--------
only the amount repaid in part shall be discharged) in cash; and
(f) (i) Subordinated Debt of the Borrower, (ii) the unsecured
Indebtedness of the Borrower under the TCIC Credit Agreement and (iii) any
Permitted Refinancing thereof;
provided, however, that no Indebtedness otherwise permitted by clause (d) or (f)
-------- ------- ---------- ---
shall be permitted to be incurred if a Default has occurred and is continuing or
would result therefrom.
SECTION 7.2.3. Liens. The Borrower will not, and will not permit any of
-----
its Restricted Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon any of its property, revenues or assets, whether now owned or
hereafter acquired, except:
(a) Liens securing payment of the Obligations, granted pursuant to
any Loan Document;
(b) until the date of the initial Credit Extension, Liens securing
payment of Indebtedness of the type permitted and described in clause (b)
----------
of Section 7.2.2;
-------------
(c) Liens securing Capitalized Lease Liability Indebtedness and
purchase money Indebtedness of the type permitted and described in clause
------
(d) of Section 7.2.2 (and securing only the assets that are financed with
--- -------------
the proceeds of such Indebtedness);
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(d) Liens existing as of the Effective Date and disclosed in Item
----
7.2.3(d) ("Ongoing Liens") of the Disclosure Schedule;
--------
(e) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves, if any, in accordance with GAAP shall have been
set aside on its books;
(f) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not overdue
or being diligently contested in good faith by appropriate proceedings and
for which adequate reserves, if any, in accordance with GAAP shall have
been set aside on its books;
(g) Liens incurred or deposits made in the ordinary course of
business in connection with workmen's compensation, unemployment insurance
or other forms of governmental insurance or benefits, or to secure
performance of tenders, statutory and regulatory obligations, bids, leases
and contracts or other similar obligations (other than for borrowed money)
entered into in the ordinary course of business or to secure obligations on
surety or appeal bonds or performance or return-of-money bonds;
(h) judgment Liens in existence less than 45 days after the entry
thereof or with respect to which execution has been stayed or the payment
of which is covered in full (subject to a customary deductible) by
insurance maintained with responsible insurance companies or which do not
otherwise result in an Event of Default under Section 8.1.6; and
-------------
(i) easements, rights-of-way, municipal and zoning ordinances or
similar restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material respect
with the ordinary conduct of the business of the Borrower or its
Subsidiaries or the value or utility of the property to which such Lien is
attached.
SECTION 7.2.4. Financial Condition and Operations. The Borrower will not
----------------------------------
permit to occur any of the events set forth below.
(a) Basic Subscribers. The Borrower will not permit the aggregate
-----------------
number of Basic Subscribers as at the date set
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forth below to be less than the number set forth opposite such date:
Basic
Date Subscribers
---- -----------
12/31/96 629,000
03/31/97 680,000
06/30/97 750,000
09/30/97 830,000
12/31/97 900,000
03/31/98 950,000
(b) Annualized Revenue per Subscriber. The Borrower will not permit
---------------------------------
Annualized Revenue per Subscriber as at the last day of any period set
forth below to be less than the amount set forth opposite such period;
Annualized Revenue
Period per Subscriber
------ ------------------
Effective Date to (and
including) 12/31/96 $425
01/01/97 to (and
including) 03/31/97 $550
04/01/97 to (and
including) 06/30/97 $550
07/01/97 to (and
including) 09/30/97 $550
10/01/97 to (and
including) 12/31/97 $550
01/01/98 to (and
including) 03/31/98 $550
(c) Total Debt per Subscriber. The Borrower will not permit Total
-------------------------
Debt per Subscriber at any time prior to March 31, 1998 to be greater than
$625.
(d) Senior Debt to Annualized Cash Flow Ratio. The Borrower will not
-----------------------------------------
permit the Senior Debt to Annualized Cash Flow Ratio at any time during any
period set forth below to be greater than the ratio set forth opposite such
period:
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Senior Debt
to Annualized Cash
Period Flow Ratio
------ --------------------
04/01/98 to (and
including) 06/30/98 4.50:1
07/01/98 to (and
including) 09/30/98 4.50:1
10/01/98 to (and
including) 12/31/98 4.25:1
01/01/99 to (and
including) 06/30/99 4.00:1
07/01/99 and thereafter 4.00:1
(e) Total Debt to Annualized Cash Flow Ratio. The Borrower will not
----------------------------------------
permit the Total Debt to Annualized Cash Flow Ratio at any time during any
period set forth below to be greater than the ratio set forth opposite such
period:
Total Debt
to Annualized Cash
Period Flow Ratio
------ --------------------
04/01/98 to (and
including) 06/30/98 7.25:1
07/01/98 to (and
including) 09/30/98 6.75:1
10/01/98 to (and
including) 12/31/98 6.25:1
01/01/99 to (and
including) 06/30/99 5.75:1
07/01/99 and thereafter 5.50:1
(f) Annualized Cash Flow to Total Interest Expense Ratio. The
----------------------------------------------------
Borrower will not permit the Annualized Cash Flow to Total Interest Expense
Ratio at any time during any period set forth below to be less than the
ratio set forth opposite such period:
Annaulized Cash Flow
to Total Interest
Period Expense Ratio
------ --------------------
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Three month period ending 1.50:1
12/31/97
01/01/98 to (and 1.75:1
including) 12/31/98
01/01/99 and thereafter 2.00:1
(g) Annualized Cash Flow to Pro Forma Debt Service Ratio. The
----------------------------------------------------
Borrower will not permit the Annualized Cash Flow to Pro Forma Debt Service
Ratio at any time to be less than 1.10:1 for any period ending on or after
12/31/97.
SECTION 7.2.5. Investments. The Borrower will not, and will not permit
-----------
any of its Restricted Subsidiaries to, make, incur, assume or suffer to exist
any Investment in any other Person, except:
(a) Investments existing on the Effective Date and identified in Item
----
7.2.5(a) ("Ongoing Investments") of the Disclosure Schedule;
--------
(b) Cash Equivalent Investments;
(c) without duplication, Investments by the Borrower to the extent
permitted as Indebtedness pursuant to Section 7.2.2;
-------------
(d) Investments constituting (i) accounts receivable arising, (ii)
trade debt granted, or (iii) deposits made in connection with the purchase
price of goods or services, in each case in the ordinary course of
business;
(e) Investments in Tempo to be used solely to pay the operating and
financing expenses of Tempo in an amount not to exceed Tempo's pro rata
share of satellite construction and financing costs; provided, however,
-------- -------
that the funds used for such Investments shall be derived solely from
EBITDA of the High Power Satellite Transmission Subsidiary;
(f) Investments by the Borrower not to exceed $100,000,000 in the
aggregate in Tempo and ResNet and in businesses of the type permitted by
the first sentence of Section 7.2.1; provided, however, that Investments
----- -------- ------------- -------- -------
(i) in Tempo (other than Investments permitted by clause (e) above) shall
----------
not exceed $30,000,000 over the term of this Agreement net of any dividends
paid in cash by Tempo to the Borrower; (ii) in ResNet shall not exceed (x)
$45,000,000 over the term of this Agreement and (y) $20,000,000 in any
Fiscal Year; (iii) constituting capital calls by Primestar shall
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not exceed $50,000,000 over the term of this Agreement; and (iv)
constituting investments in businesses permitted by Section 7.2.1 shall not
-------------
exceed $25,000,000 over the term of this Agreement;
(g) Investments in Persons which are Restricted Subsidiaries so long
as, before and after giving effect to such Investment no Default has
occurred and is continuing or is caused thereby;
provided, however, that
-------- -------
(h) any Investment which when made complies with the requirements of
clause (a), (b) or (c) of the definition of the term "Cash Equivalent
---------- --- ---
Investment" may continue to be held notwithstanding that such Investment if
made thereafter would not comply with such requirements;
(i) no Investment otherwise permitted by clause (c), (d), (e), (f) or
---------- --- --- ---
(g) shall be permitted to be made if any Default has occurred and is
---
continuing or would result therefrom; and
(j) the aggregate amount of Investments otherwise permitted by clause
------
(f) may not exceed $10,000,000 on or prior to the occurrence of the
---
Satellite Event Date and the Replacement Satellite Event.
SECTION 7.2.6. Restricted Payments, etc. The Borrower shall not and shall
------------------------
not permit any Subsidiary to make any Restricted Junior Payment, except that:
(a) dividends or distributions to the Borrower in respect of its
Equity Interests in any of its Subsidiaries;
(b) so long as no Default has occurred and is continuing (or would
result therefrom) payments by the Borrower of interest accrued on the
Subordinated Debt when due; and
(c) Unrestricted Subsidiaries may refinance in whole or in part from
time to time any of its Indebtedness so long as any such refinancing is not
recourse in any manner to the Borrower or any other Subsidiary and does not
require the imposition (contingently or otherwise) of any Lien on the
assets of the Borrower or any Restricted Subsidiary.
SECTION 7.2.7. Capital Expenditures, etc. In any Fiscal Year immediately
-------------------------
following a Fiscal Year in which the Total Debt to Annualized Cash Flow Ratio is
greater than 5.50:1, the Borrower will not, and will not permit any of its
Restricted
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Subsidiaries to, make or commit to make Capital Expenditures in such Fiscal
Year, except Capital Expenditures which do not aggregate in excess of
$425,000,000 in such Fiscal Year; provided, however, that (i) to the extent
-------- -------
Capital Expenditures are made in any Fiscal Year in an amount less than the
maximum amount permitted for such Fiscal Year, the Capital Expenditures which
the Borrower or its Restricted Subsidiaries may make or commit to make in the
next following Fiscal Year shall be increased by 50% of the amount of the
permitted Capital Expenditures not so made in the immediately preceding Fiscal
Year (the "Carry-Forward Amount"), but no further carry forward of such Carry-
--------------------
Forward Amount to any other succeeding Fiscal Year shall be permitted, and (ii)
no portion of any Carry-Forward Amount shall be used in any Fiscal Year until
the entire amount of the Capital Expenditures permitted to be made or committed
to be made in such Fiscal Year shall have been used.
SECTION 7.2.8. Subsidiaries. The Borrower will not have any Subsidiaries
------------
other than Restricted Subsidiaries and Unrestricted Subsidiaries. The Borrower
will not permit any Subsidiary to issue any Capital Stock (whether for value or
otherwise) to any Person other than the Borrower.
SECTION 7.2.9. Take or Pay Contracts. The Borrower will not, and will not
---------------------
permit any of its Restricted Subsidiaries to, enter into or be a party to any
arrangement for the purchase of materials, supplies, other property or services
if such arrangement by its express terms requires that payment be made by the
Borrower or such Restricted Subsidiary regardless of whether such materials,
supplies, other property or services are in fact or can be required to be
delivered or furnished to it.
SECTION 7.2.10. Consolidation, Merger, etc. The Borrower will not, and
--------------------------
will not permit any of its Subsidiaries to, liquidate or dissolve, consolidate
with, or merge into or with, any other corporation, or purchase or otherwise
acquire all or substantially all of the assets of any Person (or of any division
thereof) except that any Restricted Subsidiary may liquidate or dissolve
voluntarily into, and may merge with and into, the Borrower or (subject to
clauses (a) and (b)), any other Collateral Subsidiary; provided, however, that,
----------- --- -------- -------
subject to Section 7.1.8,
-------------
(a) in no event shall any Pledged Subsidiary merge with and into
(i) any Subsidiary other than another Pledged Subsidiary unless
(A) the Required Lenders shall have given their prior written consent
thereto, or (B) after giving effect thereto, the Administrative Agent
shall have a perfected pledge of, and security interest in
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and to, all of the issued and outstanding shares of Capital Stock of
the surviving Person in form and substance satisfactory to the
Administrative Agent and its counsel, pursuant to such documentation
and opinions as shall be necessary and appropriate in the opinion of
the Administrative Agent and its counsel to create, perfect or
maintain the collateral position of the Administrative Agent and the
Lenders therein as contemplated by this Agreement; or
(ii) any other Pledged Subsidiary if, after giving effect to
such merger, the Administrative Agent has less than that percentage of
the issued and outstanding shares of the surviving Person pledged to
it than it had pledged to it immediately prior to such merger; and
(b) in the case of the merger of any Subsidiary into the Borrower,
the Borrower shall be the surviving corporation and continue to be
incorporated under the laws of a State of the United States.
SECTION 7.2.11. Permitted Dispositions. The Borrower will not, and will
----------------------
not permit any of its Subsidiaries to, (a) sell, transfer, lease, contribute or
otherwise convey (including by way of merger), or grant options, warrants or
other rights with respect to, any of the Borrower's or such Subsidiaries' assets
(including accounts receivable or Capital Stock of Subsidiaries) to any Person
unless such sale, transfer, lease, contribution or conveyance of such assets is
(i) in the ordinary course of its business (and does not constitute a sale,
transfer, lease, contribution or other conveyance of all or a substantial part
of the Borrower's or such Subsidiary's assets) or is of obsolete or worn out
property, (ii) permitted by Section 7.2.10, (iii) subject to Section 7.1.8,
-------------- -------------
between Restricted Subsidiaries or from a Subsidiary to the Borrower, (iv) of
other assets of the Borrower having a value (determined based on the higher of
book and fair market value) not to exceed $15,000,000 for the term of this
Agreement or (v) assets of Tempo so long as the Net Disposition Proceeds thereof
are paid as a dividend to the Borrower, or (b) sell, transfer, lease, contribute
or otherwise dispose of any Investment in Primestar.
SECTION 7.2.12. Modification of Certain Agreements. The Borrower will
----------------------------------
not, and will not permit any of its Subsidiaries to, consent to any amendment,
supplement, amendment and restatement, waiver or other modification of any of,
or enter into any forbearance from exercising any rights with respect to, the
terms or provisions contained in, or applicable to, (i) any Transaction Document
or the Primestar Partnership Agreement, if the effect of such amendment,
supplement, amendment and
-85-
restatement, waiver or modification or forbearance might individually or in the
aggregate have a Material Adverse Effect, or (ii) any indenture, note, debenture
or other agreement evidencing or relating to Subordinated Debt.
SECTION 7.2.13. Transactions with Affiliates. The Borrower will not, and
----------------------------
will not permit any of its Restricted Subsidiaries to, enter into, or cause,
suffer or permit to exist any arrangement or contract with any of its other
Affiliates or any Unrestricted Subsidiary unless such arrangement or contract is
on fair and reasonable terms and is an arrangement or contract of the kind which
would be entered into by a prudent Person in the position of the Borrower or
such Subsidiary with a Person which is not one of its Affiliates.
SECTION 7.2.14. Negative Pledges, Restrictive Agreements, etc. The
---------------------------------------------
Borrower will not, and will not permit any of its Restricted Subsidiaries to,
enter into any agreement (excluding this Agreement and any other Loan Document
or any document pursuant to which any Indebtedness permitted by clause (d) of
----------
Section 7.2.2 is permitted but solely with respect to any asset acquired solely
-------------
with the proceeds of such Indebtedness and no other asset of the Borrower or any
Subsidiary) prohibiting
(a) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired, to the extent
that any such negative pledge would prohibit the creation or first priority
perfection of any Liens of the type described in clause (a) of Section
---------- -------
7.2.3 (other than in the case of Capitalized Leases to the extent of Liens
-----
solely in the assets subject to such Capitalized Lease);
(b) the ability of the Borrower or any other Obligor to amend or
otherwise modify this Agreement or any other Loan Document; or
(c) the ability of any Restricted Subsidiary to make any payments,
directly or indirectly, to the Borrower by way of dividends, advances,
repayments of loans or advances, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on
investments, or any other agreement or arrangement which restricts the
ability of any such Subsidiary to make any payment, directly or indirectly,
to the Borrower.
SECTION 7.2.15. Sale and Leaseback. The Borrower will not, and will not
------------------
permit any of its Restricted Subsidiaries to, enter into any agreement or
arrangement with any other Person providing for the leasing by the Borrower or
any of its Restricted Subsidiaries of real or personal property which has been
or is to
-86-
be sold or transferred by the Borrower or any of its Restricted Subsidiaries to
such other Person or to any other Person to whom funds have been or are to be
advanced by such Person on the security of such property or rental obligations
of the Borrower or any of its Restricted Subsidiaries.
SECTION 7.2.16. Tempo Indebtedness. The Borrower shall not permit Tempo
------------------
to incur, suffer to exist or otherwise become obligated on or liable with
respect to Indebtedness other than (i) an amount of Indebtedness equal to its
allocable share of the cost of construction and financing of a satellite
determined in accordance with the terms of the Primestar Partnership Agreement
and (ii) Indebtedness which has been guaranteed on a basis and pursuant to
documentation in form and substance satisfactory to the Arranging Agents by a
Primestar partner (other than another Subsidiary of the Borrower).
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following events
----------------------------
or occurrences described in this Section 8.1 shall constitute an "Event of
----------- --------
Default".
-------
SECTION 8.1.1. Non-Payment of Obligations. The Borrower shall default in
--------------------------
the payment or prepayment when due of
(a) any Reimbursement Obligation or any deposit of cash for
collateral purposes pursuant to Section 2.6.2 or Section 2.6.4, as the case
------------- -------------
may be;
(b) any principal of any Loan other than in respect of a voluntary
prepayment thereof; or
(c) any interest on any Loan or any fee described in Article III or
-----------
of any other Obligation and such default shall continue unremedied for a
period of five days.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of the
------------------
Borrower or any other Obligor made or deemed to be made hereunder or in any
other Loan Document executed by it or any other writing or certificate furnished
by or on behalf of the Borrower or any other Obligor to any Agent, any Issuer or
any Lender for the purposes of or in connection with this Agreement or any such
other Loan Document (including any certificates delivered pursuant to Article
-------
V), is or shall be incorrect when made or deemed to have been made in any
material respect.
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SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations. The
----------------------------------------------------
Borrower shall default in the due performance and observance of any of its
obligations under Section 7.1.11, 7.1.12 or Section 7.2 or the Post-Closing
-------------- ------ -----------
Events Letter.
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations. The
--------------------------------------------------
Borrower or any other Obligor shall default in the due performance and
observance of any other agreement contained herein or in any other Loan Document
executed by it, and such default shall continue unremedied for a period of 30
days after notice thereof shall have been given to the Borrower by the
Administrative Agent or any Lender.
SECTION 8.1.5. Default on Other Indebtedness. A default shall occur in
-----------------------------
the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any Indebtedness (other than Indebtedness
described in Section 8.1.1) or any other item which, in accordance with GAAP,
-------------
would be included as a liability on the liability side of the balance sheet of
such Person as of the date at which Indebtedness is to be determined
(collectively the "Subject Debt") of the Borrower or any of its Subsidiaries or
------------
Primestar having a principal amount, individually or in the aggregate, in excess
of $15,000,000, or a default shall occur in the performance or observance of any
obligation or condition with respect to such Indebtedness (subject to any
applicable grace period) if the effect of such default is to accelerate the
maturity of any such Subject Debt or such default shall permit the holder or
holders of such Subject Debt, or any trustee or agent for such holders, to cause
or declare such Subject Debt to become due and payable or to require such
Subject Debt to be prepaid, redeemed, purchased or defeased, or to cause an
offer to purchase or defease such Subject Debt to be required to be made, prior
to its expressed maturity.
SECTION 8.1.6. Judgments. Any judgment or order for the payment of money
---------
in excess of $15,000,000 (exclusive of any amounts fully covered by insurance
(less any applicable deductible) or indemnification and as to which the insurer
or the indemnifying party, as the case may be, has acknowledged its
responsibility to cover such judgment or order) shall be rendered against the
Borrower or any of its Subsidiaries and such judgment shall not have been
vacated or discharged or stayed or bonded pending appeal within 45 days after
the entry thereof.
SECTION 8.1.7. Pension Plans. Any of the following events shall occur
-------------
with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a
result of such
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termination, the Borrower or any such member could be required to make a
contribution to such Pension Plan, or could reasonably expect to incur a
liability or obligation to such Pension Plan, in excess of $1,000,000; or
(b) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under section 302(f) of ERISA.
SECTION 8.1.8. Control of the Borrower. Any Change in Control shall
-----------------------
occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower, any of its
---------------------------
Subsidiaries or Primestar shall
(a) become insolvent or generally fail to pay, or admit in writing
its inability or unwillingness generally to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for any substantial part
of the property of any thereof, or make a general assignment for the
benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for a substantial part of the property of
any thereof, and such trustee, receiver, sequestrator or other custodian
shall not be discharged within 60 days, provided that the Borrower, each
such Subsidiary hereby expressly authorizes the Administrative Agent and
each Lender to appear in any court conducting any relevant proceeding
during such 60-day period to preserve, protect and defend their rights
under this Agreement and the other Loan Documents;
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution, winding up or liquidation
proceeding, in respect thereof, and, if any such case or proceeding is not
commenced by the Borrower or any such Subsidiary, such case or proceeding
shall be consented to or acquiesced in by the Borrower or such Subsidiary,
as the case may be, or shall result in the entry of an order for relief or
shall remain for 60 days undismissed, provided that the Borrower and each
Subsidiary hereby expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any such case or proceeding during
such 60-day period to
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preserve, protect and defend their rights under the Loan Documents; or
(e) take any corporate action authorizing, or in furtherance of, any
of the foregoing.
SECTION 8.1.10. Impairment of Security, etc. Any Loan Document, or any
---------------------------
Lien granted thereunder, shall (except in accordance with its terms), in whole
or in part, terminate, cease to be effective or cease to be the legally valid,
binding and enforceable obligation of any Obligor party thereto; the Borrower,
any other Obligor or any other party shall, directly or indirectly, contest in
any manner such effectiveness, validity, binding nature or enforceability; or,
except as permitted under any Loan Document, any Lien securing any Obligation
shall, in whole or in part, cease to be a perfected first priority Lien.
SECTION 8.1.11. Material Adverse Change. There has been a material
-----------------------
adverse change in the consolidated financial condition, results of operations,
assets, business or properties of the Borrower and its Subsidiaries, taken as a
whole, or the Borrower and its Restricted Subsidiaries, taken as a whole.
SECTION 8.1.12. Satellite Failure. The Satellite Event Date has not
-----------------
occurred on or prior to June 30, 1997.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described in
--------------------
clauses (a) through (d) of Section 8.1.9 shall occur, the Commitments (if not
----------- --- -------------
theretofore terminated) shall automatically terminate and the outstanding
principal amount of all outstanding Loans and all other Obligations (including
Reimbursement Obligations) shall automatically be and become immediately due and
payable, without notice or demand and the Borrower shall automatically and
immediately be obligated to deposit with the Administrative Agent cash
collateral in an amount equal to all Letter of Credit Outstandings.
SECTION 8.3. Action if Other Event of Default. If any Event of Default
--------------------------------
(other than any Event of Default described in clauses (a) through (d) of Section
----------- --- -------
8.1.9) shall occur for any reason, whether voluntary or involuntary, and be
-----
continuing, the Administrative Agent, upon the direction of the Required
Lenders, shall by notice to the Borrower declare all or any portion of the
outstanding principal amount of the Loans and other Obligations (including
Reimbursement Obligations) to be due and payable and/or the Commitments (if not
theretofore terminated) to be terminated, whereupon the full unpaid amount of
such Loans and other Obligations which shall be so declared due and payable
shall be and become immediately due and payable, without further notice, demand
or presentment, and/or, as the case may be, the Commitments shall terminate and
the Borrower shall automatically
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and immediately be obligated to deposit with the Administrative Agent cash
collateral in an amount equal to all Letter of Credit Outstandings.
ARTICLE IX
THE AGENTS
SECTION 9.1. Actions. Each Lender hereby appoints Scotiabank as its
-------
Administrative Agent, NationsBank as its Syndication Agent, Credit Lyonnais as
its Documentation Agent and each of Scotiabank, NationsBank and Credit Lyonnais
as an Arranging Agent, in each case under and for purposes of this Agreement,
the Notes and each other Loan Document. Each Lender authorizes each Agent to
act on behalf of such Lender under this Agreement, the Notes and each other Loan
Document and, in the absence of other written instructions from the Required
Lenders received from time to time by such Agent (with respect to which each
Agent agrees that it will comply, except as otherwise provided in this Section
or as otherwise advised by counsel in order to avoid contravention of applicable
law), to exercise such powers hereunder and thereunder as are specifically
delegated to or required of such Agent by the terms hereof and thereof, together
with such powers as may be reasonably incidental thereto. Each Lender hereby
indemnifies (which indemnity shall survive any termination of this Agreement)
each Agent, pro rata according to such Lender's Percentage, from and against any
--- ----
and all liabilities, obligations, losses, damages, claims, costs or expenses of
any kind or nature whatsoever which may at any time be imposed on, incurred by,
or asserted against, such Agent in any way relating to or arising out of this
Agreement, the Notes and any other Loan Document, including reasonable
attorneys' fees, and as to which such Agent is not reimbursed by the Borrower;
provided, however, that no Lender shall be liable for the payment of any portion
-------- -------
of such liabilities, obligations, losses, damages, claims, costs or expenses
which are determined by a court of competent jurisdiction in a final proceeding
to have resulted solely from such Agent's gross negligence or wilful misconduct.
No Agent shall be required to take any action hereunder, under the Notes or
under any other Loan Document, or to prosecute or defend any suit in respect of
this Agreement, the Notes or any other Loan Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of any Agent shall be
or become, in such Agent's determination, inadequate, such Agent may call for
additional indemnification from the Lenders and cease to do the acts indemnified
against hereunder until such additional indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent shall
---------------------
have been notified by telephone,
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confirmed in writing, by any Lender by 5:00 p.m., New York City time, on the
Business Day prior to a Borrowing that such Lender will not make available the
amount which would constitute its Percentage of such Borrowing on the date
specified therefor, the Administrative Agent may assume that such Lender has
made such amount available to the Administrative Agent and, in reliance upon
such assumption, make available to the Borrower a corresponding amount. If and
to the extent that such Lender shall not have made such amount available to the
Administrative Agent, such Lender and the Borrower severally agree to repay the
Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date the Administrative Agent made such
amount available to the Borrower to the date such amount is repaid to the
Administrative Agent, at the interest rate applicable at the time to Loans
comprising such Borrowing (in the case of the Borrower) and (in the case of a
Lender), at the Federal Funds Rate (for the first two Business Days after which
such amount has not been repaid, and thereafter at the interest rate applicable
to Loans comprising such Borrowing.
SECTION 9.3. Exculpation. None of the Agents nor any of their respective
-----------
directors, officers, employees or agents shall be liable to any Lender for any
action taken or omitted to be taken by it under this Agreement or any other Loan
Document, or in connection herewith or therewith, except for its own wilful
misconduct or gross negligence, nor responsible for any recitals or warranties
herein or therein, nor for the effectiveness, enforceability, validity or due
execution of this Agreement or any other Loan Document, nor for the creation,
perfection or priority of any Liens purported to be created by any of the Loan
Documents, or the validity, genuineness, enforceability, existence, value or
sufficiency of any collateral security, nor to make any inquiry respecting the
performance by any Obligor of its obligations hereunder or under any other Loan
Document. Any such inquiry which may be made by an Agent shall not obligate it
to make any further inquiry or to take any action. Each Agent shall be entitled
to rely upon advice of counsel concerning legal matters and upon any notice,
consent, certificate, statement or writing which such Agent believes to be
genuine and to have been presented by a proper Person.
SECTION 9.4. Successor. Any Agent may resign as such at any time upon at
---------
least 30 days' prior notice to the Borrower and all Lenders. If an Agent at any
time shall resign, the Required Lenders may appoint another Lender as a
successor Agent which, with the prior written consent of the Borrower, not to be
unreasonably withheld or delayed, shall thereupon become such an Agent
hereunder. If no such successor Agent shall have been so appointed by the
Required Lenders, and shall have accepted such appointment, within 30 days after
the retiring Agent's giving
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notice of resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent, which shall be one of the Lenders or a commercial
banking institution organized under the laws of the U.S. (or any State thereof)
or a U.S. branch or agency of a commercial banking institution, and having (x) a
combined capital and surplus of at least $500,000,000 and (y) a credit rating of
A or better by ▇▇▇▇▇'▇ or a comparable rating by S&P; provided, however, that
-------- -------
if, after expending all reasonable commercial efforts, such retiring Agent is
unable to find a commercial banking institution which is willing to accept such
appointment and which meets the qualifications set forth in clause (y) above,
----------
such retiring Agent, shall be permitted to appoint as its successor from all
available commercial banking institutions willing to accept such appointment
such institution having the highest credit rating of all such available and
willing institutions. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall be entitled to receive from the
retiring Agent such documents of transfer and assignment as such successor Agent
may reasonably request, and shall thereupon succeed to and become vested with
all rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under this
Agreement. After any retiring Agent's resignation hereunder as the Agent, the
provisions of
(a) this Article IX shall inure to its benefit as to any actions
----------
taken or omitted to be taken by it while it was the Agent under this
Agreement; and
(b) Section 10.3 and Section 10.4 shall continue to inure to its
------------ ------------
benefit.
SECTION 9.5. Loans by Agents. Each Agent shall have the same rights and
---------------
powers with respect to (x) the Credit Extensions made by it or any of its
Affiliates, and (y) the Notes held by it or any of its Affiliates as any other
Lender and may exercise the same as if it were not an Agent. Each Agent and its
Affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Borrower or any Subsidiary or Affiliate of the
Borrower as if such Agent were not an Agent hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has,
----------------
independently of the Agents and each other Lender, and based on such Lender's
review of the financial information of the Borrower, this Agreement, the other
Loan Documents (the terms and provisions of which being satisfactory to such
Lender) and such other documents, information and investigations as such Lender
has deemed appropriate, made its own credit decision to extend its Commitments.
Each Lender also acknowledges that it will, independently of the Agents and each
other Lender, and
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based on such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any other Loan Document.
SECTION 9.7. Copies, etc. The Administrative Agent shall give prompt
-----------
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of this
Agreement (unless concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document or instrument
received for its account and copies of all other communications received by the
Administrative Agent from the Borrower for distribution to the Lenders by the
Administrative Agent in accordance with the terms of this Agreement or any other
Loan Document.
SECTION 9.8. The Agents. Notwithstanding anything else to the contrary
----------
contained in this Agreement or any other Loan Document, none of the
Documentation Agent, the Syndication Agent or the Arranging Agents, in such
capacity, shall have any rights, duties or responsibilities under this Agreement
or any other Loan Document, or any fiduciary relationship with any Secured
Party, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise exist
against any of such Agent in such capacity.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of this Agreement
------------------------
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented to
by the Borrower and the Required Lenders; provided, however, that no such
-------- -------
amendment, modification or waiver shall:
(a) extend any Commitment Termination Date or the date of any
mandatory Commitment reduction under clause (a) of Section 2.2.2 or modify
---------- -------------
this Section 10.1 without the consent of all Lenders;
------------
(b) increase the aggregate amount of any Lender's Percentage of any
Commitment Amount, increase the aggregate amount of any Loans required to
be made by a Lender pursuant to its Commitments or reduce any fees
described in Article III payable to any Lender without the consent of such
-----------
Lender;
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(c) extend the Stated Maturity Date for any Lender's Loan or the due
date of any interest thereon, or reduce the principal amount of or rate of
interest on any Lender's Loan, without the consent of such Lender (it being
understood and agreed, however, that any vote to rescind any acceleration
made pursuant to Section 8.2 and Section 8.3 of amounts owing with respect
----------- -----------
to the Loans and other Obligations shall only require the vote of the
Required Lenders);
(d) change the definition of "Required Lenders" or any requirement
hereunder that any particular action be taken by all Lenders without the
consent of all Lenders or change the definition of "Blocked Amount";
(e) increase the Stated Amount of any Letter of Credit unless
consented to by each Issuer;
(f) except as permitted by the Borrower Security Agreement, Borrower
Pledge Agreement, Subsidiary Security Agreement or Subsidiary Guarantee,
release (i) any of the guarantees of any Restricted Subsidiary or (ii) all
or substantially all of the collateral or Pledged Shares as such term is
defined in the Borrower Pledge Agreement), in either case without the
consent of all Lenders as expressly provided herein or therein; or
(g) affect adversely the interests, rights or obligations of the
Administrative Agent qua the Administrative Agent, the Syndication Agent
---
qua the Syndication Agent, the Documentation Agent qua the Documentation
--- ---
Agent, any Arranging Agent qua Arranging Agent or any Issuer qua Issuer,
--- ---
unless consented to by such Agent or such Issuer, as the case may be.
No failure or delay on the part of any Agent, any Issuer or any Lender in
exercising any power or right under this Agreement or any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Borrower in
any case shall entitle it to any notice or demand in similar or other
circumstances. No waiver or approval by any Agent, any Issuer or any Lender
under this Agreement or any other Loan Document shall, except as may be
otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.
SECTION 10.2. Notices. All notices and other communications provided to
-------
any party hereto under this Agreement
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or any other Loan Document shall be in writing or by facsimile and addressed,
delivered or transmitted to such party at its address or facsimile number set
forth below its signature hereto or set forth in the Lender Assignment Agreement
or at such other address or facsimile number as may be designated by such party
in a notice to the other parties. Any notice, if mailed and properly addressed
with postage prepaid or if properly addressed and sent by pre-paid courier
service, shall be deemed given when received; any notice, if transmitted by
facsimile, shall be deemed given when the confirmation of transmission thereof
is received by the transmitter.
SECTION 10.3. Payment of Costs and Expenses. The Borrower agrees to pay
-----------------------------
on demand all expenses of the Administrative Agent (including the fees and out-
of-pocket expenses of counsel to the Administrative Agent and of local counsel,
if any, who may be retained by counsel to the Administrative Agent) in
connection with
(a) the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from time
to time hereafter be required, whether or not the transactions contemplated
hereby are consummated; and
(b) the filing, recording, refiling or rerecording of any Loan
Document and/or any Uniform Commercial Code financing statements relating
thereto and all amendments, supplements, amendments and restatements and
other modifications to any thereof and any and all other documents or
instruments of further assurance required to be filed or recorded or
refiled or rerecorded by the terms hereof or the terms of any Loan
Document; and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save each Agent, each Issuer and the
Lenders harmless from all liability for, any stamp or other taxes which may be
payable in connection with the execution or delivery of this Agreement, the
Credit Extensions hereunder, or the issuance of the Notes, Letters of Credit or
any other Loan Documents. The Borrower also agrees to reimburse each Agent,
each Issuer and each Lender upon demand for all reasonable out-of-pocket
expenses (including reasonable attorneys' fees and legal expenses of counsel to
each Agent, each Issuer and the Lenders) incurred by each Agent, each Issuer or
such Lenders in connection with (x) the negotiation of any restructuring or
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"work-out" with the Borrower, whether or not consummated, of any Obligations and
(y) the enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the execution and
---------------
delivery of this Agreement by each Lender and the extension of the Commitments,
the Borrower hereby indemnifies, exonerates and holds each Agent, each Issuer
and each Lender and each of their respective officers, directors, employees and
agents (collectively, the "Indemnified Parties") free and harmless from and
-------------------
against any and all actions, causes of action, suits, losses, costs, liabilities
and damages, and expenses incurred in connection therewith (irrespective of
whether any such Indemnified Party is a party to the action for which
indemnification hereunder is sought), including reasonable attorneys' fees and
disbursements, whether incurred in connection with actions between or among the
parties hereto or the parties hereto and third parties (collectively, the
"Indemnified Liabilities"), incurred by the Indemnified Parties or any of them
------------------------
as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Credit Extension,
including all Indemnified Liabilities arising in connection with the
transactions contemplated hereby;
(b) the entering into and performance of this Agreement and any other
Loan Document by any of the Indemnified Parties (including any action
brought by or on behalf of the Borrower as the result of any determination
by the Required Lenders pursuant to Article V not to fund any Credit
---------
Extension);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any Person,
whether or not any Agent, any Issuer or any Lender is party thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by the Borrower or any of its
Subsidiaries of any Hazardous Material;
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any Subsidiary thereof of any
Hazardous Material (including any losses, liabilities, damages, injuries,
costs, expenses or claims asserted or arising under any
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Environmental Law), regardless of whether caused by, or within the control
of, the Borrower or such Subsidiary; or
(f) each Agent's and each Lender's Environmental Liability (the
indemnification herein shall survive repayment of the Notes and any
transfer of the property of the Borrower or any of its Subsidiaries by
foreclosure or by a deed in lieu of foreclosure for any Agent's or Lender's
Environmental Liability, regardless of whether caused by, or within the
control of, the Borrower or such Subsidiary);
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or wilful misconduct. The Borrower and its successors and assigns
hereby waive, release and agree not to make any claim or bring any cost recovery
action against, any Agent, any Issuer or any Lender under CERCLA or any state
equivalent, or any similar law now existing or hereafter enacted. It is
expressly understood and agreed that to the extent that any of such Persons is
strictly liable under any Environmental Laws, the Borrower's obligation to such
Person under this indemnity shall likewise be without regard to fault on the
part of the Borrower with respect to the violation or condition which results in
liability of such Person. If and to the extent that the foregoing undertaking
may be unenforceable for any reason, the Borrower hereby agrees to make the
maximum contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
SECTION 10.5. Survival. The obligations of the Borrower under Sections
-------- --------
4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the Lenders under
--- --- --- --- ---- ----
Section 9.1, shall in each case survive any assignment from one Lender to
-----------
another (in the case of Sections 10.3 and 10.4) and any termination of this
------------- ----
Agreement, the payment in full of all the Obligations and the termination of all
the Commitments. The representations and warranties made by the Borrower and
each other Obligor in this Agreement and in each other Loan Document shall
survive the execution and delivery of this Agreement and each such other Loan
Document.
SECTION 10.6. Severability. Any provision of this Agreement or any other
------------
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
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SECTION 10.7. Headings. The various headings of this Agreement and of
--------
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This
---------------------------------------------
Agreement may be executed by the parties hereto in several counterparts, each of
which shall be an original and all of which shall constitute together but one
and the same agreement. This Agreement shall become effective when counterparts
hereof executed on behalf of the Borrower, each Agent and each Lender (or notice
thereof satisfactory to the Arranging Agents) shall have been received by the
Arranging Agents and notice thereof shall have been given by the Administrative
Agent to the Borrower and each Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE NOTES
-------------------------------
AND EACH OTHER LOAN DOCUMENT (INCLUDING WITHOUT LIMITATION PROVISIONS WITH
RESPECT TO INTEREST, LOAN CHARGES AND COMMITMENT FEES) SHALL EACH BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT THE
VALIDITY OR PERFECTION OF A SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER,
IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK. This Agreement, the Notes and
the other Loan Documents constitute the entire understanding among the parties
hereto with respect to the subject matter hereof and thereof and supersede any
prior agreements, written or oral, with respect thereto.
SECTION 10.10. Successors and Assigns. This Agreement shall be binding
----------------------
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
-------- -------
(a) the Borrower may not assign or transfer its rights or obligations
hereunder without the prior written consent of the Administrative Agent and
all Lenders; and
(b) the rights of sale, assignment and transfer of the Lenders are
subject to Section 10.11.
-------------
SECTION 10.11. Sale and Transfer of Loans and Notes; Participations in
-------------------------------------------------------
Loans and Notes. Each Lender may assign, or sell participations in, its Loans,
---------------
Letters of Credit and Commitments to one or more other Persons in accordance
with this Section 10.11.
-------------
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SECTION 10.11.1. Assignments. Upon prior notice to the Borrower and the
-----------
Administrative Agent, any Lender,
(a) with the consent of the Borrower and the Administrative Agent
(which consents shall not be unreasonably delayed or withheld) may at any
time assign and delegate to one or more commercial banks or other financial
institutions, and
(b) with notice to the Borrower and the Administrative Agent, but
without the consent of the Borrower or the Administrative Agent, may assign
and delegate to any of its Affiliates or to any other Lender
(each Person described in either of the foregoing clauses as being the Person to
whom such assignment and delegation is to be made, being hereinafter referred to
as an "Assignee Lender"), all or any fraction of such Lender's total Loans,
---------------
Letter of Credit Outstandings and Commitments in a minimum aggregate amount of
$10,000,000 (or, if less, the entire remaining amount of such Lender's Loans,
Letter of Credit Outstandings and Commitment); provided, however, that the
-------- -------
assigning Lender must assign a pro-rata portion of each of its Commitment, Loans
and interest in Letter of Credit Outstandings. The Borrower and each other
Obligor and the Administrative Agent shall be entitled to continue to deal
solely and directly with such Lender in connection with the interests so
assigned and delegated to an Assignee Lender until
(c) notice of such assignment and delegation, together with (i)
payment instructions, (ii) the Internal Revenue Service Forms or other
statements contemplated or required to be delivered pursuant to Section
-------
4.6, if applicable, and (iii) addresses and related information with
respect to such Assignee Lender, shall have been delivered to the Borrower
and the Administrative Agent by such Lender and such Assignee Lender;
(d) such Assignee Lender shall have executed and delivered to the
Borrower and the Administrative Agent a Lender Assignment Agreement,
accepted by the Administrative Agent; and
(e) the processing fees described below shall have been paid.
From and after the date that the Administrative Agent accepts such Lender
Assignment Agreement, (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights and
obligations hereunder have been assigned and delegated to such Assignee Lender
in
-100-
connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y)
the assignor Lender, to the extent that rights and obligations hereunder have
been assigned and delegated by it in connection with such Lender Assignment
Agreement, shall be released from its obligations hereunder and under the other
Loan Documents. Within five Business Days after its receipt of notice that the
Administrative Agent has received and accepted an executed Lender Assignment
Agreement, but subject to clause (a) or (d) above, the Borrower shall execute
---------- ---
and deliver to the Administrative Agent (for delivery to the relevant Assignee
Lender) a new Note evidencing such Assignee Lender's assigned Loans and
Commitments and, if the assignor Lender has retained Loans and Commitments
hereunder, a replacement Note in the principal amount of the Loans and
Commitments retained by the assignor Lender hereunder (such Note to be in
exchange for, but not in payment of, the Note then held by such assignor
Lender). Each such Note shall be dated the date of the predecessor Note.
Accrued interest on that part of each predecessor Note evidenced by a new Note,
and accrued fees, shall be paid as provided in the Lender Assignment Agreement.
Accrued interest on that part of each predecessor Note evidenced by a
replacement Note shall be paid to the assignor Lender. Accrued interest and
accrued fees shall be paid at the same time or times provided in the predecessor
Note and in this Agreement. Such assignor Lender or such Assignee Lender must
also pay a processing fee in the amount of $3,500 to the Administrative Agent
upon delivery of any Lender Assignment Agreement. Any attempted assignment and
delegation not made in accordance with this Section 10.11.1 shall be null and
---------------
void. Notwithstanding anything to the contrary set forth above, any Lender may
(without requesting the consent of the Borrower or the Administrative Agent)
pledge its Loans to a Federal Reserve Bank in support of borrowings made by such
Lender from such Federal Reserve Bank.
SECTION 10.11.2. Participations. Upon prior written notice to the
--------------
Borrower and the Administrative Agent, any Lender may at any time sell to one or
more commercial banks or other Persons (each of such commercial banks and other
Persons being herein called a "Participant") participating interests in any of
-----------
the Loans, Commitments, or other interests of such Lender hereunder; provided,
--------
however, that
-------
(a) no participation contemplated in this Section 10.11 shall relieve
-------------
such Lender from its Commitments or its other obligations hereunder or
under any other Loan Document;
(b) such Lender shall remain solely responsible for the performance
of its Commitments and such other obligations;
-101-
(c) the Borrower and each other Obligor and the Administrative Agent
shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under this Agreement and each of
the other Loan Documents;
(d) no Participant, unless such Participant is an Affiliate of such
Lender or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any Participant that such
Lender will not, without such Participant's consent, take any actions of
the type described in clause (a), (b), (f) or, to the extent requiring the
---------- --- ---
consent of each Lender, clause (c) of Section 10.1; and
---------- ------------
(e) the Borrower shall not be required to pay any amount under this
Agreement that is greater than the amount which it would have been required
to pay had no participating interest been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 7.1.1, 10.3 and 10.4, shall be considered
------------ --- --- --- --- --- ----- ---- ----
a Lender. Each Participant shall only be indemnified for increased costs
pursuant to Section 4.3, 4.5 or 4.6 if and to the extent that the Lender which
----------- --- ---
sold such participating interest to such Participant concurrently is entitled to
make, and does make, a claim on the Borrower for such increased costs. Any
Lender that sells a participating interest in any Loan, Commitment or other
interest to a Participant under this Section 10.11.2 shall indemnify and hold
---------------
harmless the Borrower and the Administrative Agent from and against any taxes,
penalties, interest or other costs or losses (including, without limitation,
reasonable attorneys' fees and expenses) incurred or payable by the Borrower or
the Administrative Agent as a result of the failure of the Borrower or the
Administrative Agent to comply with its obligations to deduct or withhold any
Taxes from any payments made pursuant to this Agreement to such Lender or the
Administrative Agent, as the case may be, which Taxes would not have been
incurred or payable if such Participant had been a Non-U.S. Lender that was
entitled to deliver to the Borrower, the Administrative Agent or such Lender,
and did in fact so deliver, a duly completed and valid Form 1001 or 4224 (or
applicable successor form) entitling such Participant to receive payments under
this Agreement without deduction or withholding of any United States federal
taxes.
SECTION 10.12. Other Transactions. Nothing contained herein shall
------------------
preclude any Agent, any Issuer or any other Lender from engaging in any
transaction, in addition to those
-102-
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Affiliates in which the Borrower or such Affiliate is not restricted
hereby from engaging with any other Person.
SECTION 10.13. Execution on Behalf of Corporation. Any signature by any
----------------------------------
Authorized Officer on this Agreement, any Loan Document and any other instrument
and certificate executed or to be executed pursuant to or in connection with
this Agreement or such other Loan Documents is provided only in such Authorized
Officer's capacity as a corporate officer, and not in any way in such Authorized
Officer's personal capacity.
SECTION 10.14. Forum Selection and Consent to Jurisdiction. ANY
-------------------------------------------
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ARRANGING
AGENTS, THE LENDERS, ANY ISSUER OR THE BORROWER IN CONNECTION HEREWITH OR
THEREWITH SHALL, TO THE EXTENT PERMITTED BY APPLICABLE LAW, BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER,
-------- -------
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY
BE BROUGHT, AT THE ARRANGING AGENTS' OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE
AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION, SUBJECT TO THE BORROWER'S RIGHT TO CONTEST SUCH
JUDGMENT BY MOTION OR APPEAL ON ANY GROUNDS NOT EXPRESSLY WAIVED IN THIS SECTION
-------
10.14. SUCH SERVICE MAY BE MADE BY MAILING OR DELIVERING A COPY OF SUCH PROCESS
-----
TO THE BORROWER IN CARE OF THE PROCESS AGENT AT THE PROCESS AGENT'S ABOVE
ADDRESS, AND THE BORROWER HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS
AGENT TO ACCEPT SUCH SERVICE ON ITS BEHALF. AS AN ALTERNATIVE METHOD OF
SERVICE, THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY
REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE
STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 10.2. THE
------------
BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
-103-
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED
BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
SECTION 10.15. Waiver of Jury Trial. THE AGENTS, THE LENDERS, EACH ISSUER
--------------------
AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE TO THE
FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
THE AGENTS, THE LENDERS, EACH ISSUER OR THE BORROWER IN CONNECTION HEREWITH OR
THEREWITH. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH
OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE AGENTS, THE LENDERS AND EACH ISSUER ENTERING INTO
THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
-104-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
TCI SATELLITE ENTERTAINMENT, INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Title: Sup and CFO
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
with a copy similarly addressed:
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
as an Arranging Agent and
as the Administrative Agent
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Title: Authorized Signature
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
CREDIT LYONNAIS NEW YORK BRANCH,
as an Arranging Agent and
as the Documentation Agent
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Vice President
Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
NATIONSBANK OF TEXAS, N.A.,
as an Arranging Agent and
as the Syndication Agent
By:__________________________________
Title:
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
CREDIT LYONNAIS NEW YORK BRANCH
as an Arranging Agent and
as the Documentation Agent
By:______________________________
Title: Vice President
Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
NATIONSBANK OF TEXAS, N.A.,
as an Arranging Agent and
as the Syndication Agent
BY:/s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Title: Sup
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Lenders:
-------
Commitment: THE BANK OF NOVA SCOTIA, as a
Lender
33.33%
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇
Domestic Office:
---------------
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
LIBOR Office:
------------
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
CREDIT LYONNAIS NEW YORK BRANCH,
as a Lender
33.33%
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VICE PRESIDENT
Domestic Office:
---------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
LIBOR Office:
------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
NATIONSBANK OF TEXAS, N.A., as a
Lender
33.33%
By:/S/ ▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Sup
Domestic Office:
---------------
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
LIBOR Office:
------------
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
SCHEDULE 1
DISCLOSURE SCHEDULE TO CREDIT AGREEMENT
ITEM 6.3 Approvals
-------------------
Approvals of PrimeStar Partners, L.P. for the pledge of shares of TCISE
Partner 1, Inc.
ITEM 6.7 Litigation
--------------------
None
ITEM 6.9 Existing Subsidiaries
-------------------------------
TCISE Partner 1, Inc. Restricted
TCISE Partner 2, Inc. Restricted
TCI Satellite MDU, Inc. Restricted
Tempo Satellite, Inc. Unrestricted
ITEM 6.13 Environmental Matters
--------------------------------
None
ITEM 6.14 Intellectual Property
--------------------------------
None
ITEM 7.2.2(b)(i) Indebtedness to be Paid
-----------------------------------------
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
-------- ----------------------------
TCI Communications Inc. $251,948,180.56
SCHEDULE 1
Disclosure Schedule to Credit Agreement
ITEM 7.2.2(b)(ii) Ongoing Indebtedness
---------------------------------------
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
-------- ----------------------------
CSG Systems, Inc. $ 1,222,509
TCI Communications Inc. $ - (1)
(1) The Borrower is required to enter into an amendment to the TCI
Credit Agreement by January 15, 1997 to establish a $100 million
Subordinated Debt facility which the Borrower will utilize upon the
unsuccessful launch of the GE-2 satellite and the full utilization of
the banks $350 million commitments.
ITEM 7.2.3(d) Ongoing Liens
----------------------------
None
ITEM 7.2.5(a) Ongoing Investments
----------------------------------
Description Type Ownership % Amount
----------- ---- ----------- ------
PrimeStar Partners, L.P. Partnership 20.86% $60,000,000
Interest
ResNet Communications, Inc. Common 4.99% $ 5,396,000
Stock
Dreyfus Government Cash Money N/A $ 3,000,000 (1)
Management Market
Investments in Subsidiaries
---------------------------
TCISE Partner 1, Inc.
TCISE Partner 2, Inc.
TCI Satellite MOU, Inc.
Tempo Satellite, Inc.
(1) Estimated balance as of December 31, 1996