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EXHIBIT 10.21
REVOLVING CREDIT AGREEMENT BETWEEN TELECOMUNICACIONES DE
PUERTO RICO, INC. AND BANCO BILBAO VIZCAYA
REVOLVING CREDIT AGREEMENT
Dated as of May 4, 2000
TELECOMUNICACIONES DE PUERTO RICO, INC., a Puerto Rico corporation (the
"Borrower"), PUERTO RICO TELEPHONE COMPANY, INC., a Puerto Rico corporation
("PRTC"), and CELULARES TELEFONICA, INC., a Puerto Rico corporation ("CTI" and,
collectively with PRTC, the "Guarantors"), Banco Bilbao Vizcaya Argentaria S. A.
("BBV"),g Banco Bilbao Vizcaya Puerto Rico ("BBVPR" and together with BBV, the
"Lenders"), and BBVPR, as administrative agent for the Lenders (in such
capacity, the "Administrative Agent"), agree as follows:
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01 Certain Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Administrative Agent's Account" means the account of the Administrative Agent
maintained by the Administrative Agent at The Chase Manhattan Bank with its
office at New York, New York ABA No. ▇▇▇▇▇▇▇▇▇, Account No. 001-▇▇▇▇▇▇▇, Banco
Bilbao Vizcaya Puerto Rico, Attention: Corporate Banking.
"Advance" means a Revolving Credit Advance.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 10% or more of the Voting Stock of such Person or
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of Voting Stock, by contract or otherwise.
"Applicable Lending Office" means, with respect to each Lender, such Lender's
LIBOR Lending Office.
"Applicable Margin" means 0.50%, for any Interest Period.
"Assignment and Acceptance" has the meaning assigned to that term in Section
9.07.
"Base Rate" means, for any day, the simple average of the rates of interest
announced publicly on such day in the Wall Street Journal by the principal
commercial banks in New York, New York as their prime commercial lending rate,
which for purposes hereof is not intended to be the lowest or best rate of
interest charged by any Lender to a customer, with each change in such rate to
be effective for purposes hereof on the day in which any such change is
announced as herein provided, whether or not such change is notified to the
Borrower by the Administrative Agent. The Base Rate will be computed on the
basis of a 360 day year for the actual number of days elapsed occurring in the
period for which such interest is payable.
"Base Rate Advance" means a Revolving Credit Advance that bears interest based
upon the Base Rate as provided in Section 2.06(a)(i).
"Borrower" has the meaning specified in the recital of parties.
"Borrower's Account" means the account of the Borrower maintained by the
Borrower at Banco Popular de Puerto Rico with its office at Popular Center, Hato
Rey, Puerto Rico, Account No. 030-303664.
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"Bonds" means the following series of senior notes issued by the Borrower: (i)
$300,000,000 of 6.15% Senior Notes Due 2002; (ii) $400,000,000 of 6.65% Senior
Notes due 2006; and (iii) $300,000,000 of 6.80% Senior Notes due 2009.
"Borrowing" means a Revolving Credit Borrowing.
"Business Day" means a day of the year on which banks are not required or
authorized by law or executive order to close in New York City or San ▇▇▇▇,
Puerto Rico, provided that, if the applicable Business Day relates to any LIBOR
Rate Advances, "Business Day" means a day of the year on which banks are not
required or authorized by law or executive order to close in New York City or
San ▇▇▇▇, Puerto Rico and on which dealings are carried on in the London
interbank market.
"Commitment" has the meaning specified in Section 2.01.
"Consolidated" refers to the consolidation of accounts in accordance with GAAP.
"Controlling Interest" means (a) ownership of at least 40% plus one share of the
Voting Stock of the Borrower and (b) the ability to appoint a majority of the
Board of Directors of the Borrower.
"Convert", "Conversion" and "Converted" each refers to a conversion of Revolving
Credit Advances of one Type into Revolving Credit Advances of the other Type
pursuant to Section 2.07 or 2.08.
"Debt" of any Person means, without duplication, (a) all indebtedness of such
Person for borrowed money, (b) all obligations of such Person for the deferred
purchase price of property or services (other than trade payables incurred in
the ordinary course of such Person's business for which collection proceedings
have not been commenced, provided that trade payables for which collection
proceedings have commenced shall not be included in the term "Debt" so long as
the payment of such trade payables is being contested in good faith and by
proper proceedings and for which appropriate reserves are being maintained), (c)
all obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all obligations of such Person created or arising under
any conditional sale or other similar title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all obligations of such Person as
lessee under leases that have been, in accordance with GAAP, recorded as capital
leases, (f) all obligations, contingent or otherwise, of such Person in respect
of acceptances, letters of credit or similar extensions of credit, (g) all net
obligations of such Person in respect of Hedge Agreements, (h) all Debt of
others referred to in clauses (a) through (g) above or clause (i) or (j) below
guaranteed directly, or indirectly through a Subsidiary, by such Person, or in
effect guaranteed directly, or indirectly through a Subsidiary, by such Person
through a written agreement either (1) to pay or purchase such Debt or to
advance or supply funds for the payment or purchase of such Debt, or (2) to
purchase, sell or lease (as lessee or lessor) property, or to purchase or sell
services, primarily for the purpose of enabling the debtor to make payment of
such Debt or to assure the holder of such Debt against loss, (i) all Debt
referred to in clauses (a) through (h) above secured by (or for which the holder
of such Debt has an existing right, contingent or otherwise, to be secured by)
any Lien on property (including, without limitation, accounts and contract
rights) owned by such Person, even though such Person has not assumed or become
liable for the payment of such Debt and (j) all obligations of such Person to
purchase, redeem, retire, defease or otherwise make any payment in respect of
any capital stock of or other ownership or profit interest in such Person or any
other Person or any warrants, rights or options to acquire such capital stock,
valued at the greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends and interest.
"Debt to EBITDA Ratio" of any Person at any date means the ratio of (a) Debt of
the types that, in accordance with GAAP, would be classified as indebtedness on
a Consolidated balance sheet of such Person on such date to (b) EBITDA for the
period of four fiscal quarters of such Person ended on or immediately prior to
such date, provided that for purposes of clause (a) of this definition, Debt
shall not include (1) the obligations specified in clause (g) of the definition
thereof set forth above or (2) with respect to the Borrower, any obligations
which may be assumed by the Borrower for guaranties of any indebtedness of the
Borrower's employee stock ownership plan up to an aggregate principal amount of
$26,100,000.
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"Default" means any Event of Default or any event that would constitute an Event
of Default but for the requirement that notice be given or time elapse or both.
"Disclosed Litigation" has the meaning specified in Section 3.01(b).
"EBITDA" means the sum, determined on a Consolidated basis, of the Borrower's
(i) net income (or net loss), (ii) interest expense, (iii) income tax expense,
(iv) depreciation expense, (v) amortization expense, (vi) non-cash severance
charges in an aggregate amount not to exceed $120,000,000 in calendar year 1999
and $30,000,000 in calendar year 2001, and (vii) non cash charges relating to
the contribution to an employee stock ownership plan in an aggregate amount not
to exceed $23,100,000 in calendar year 1999.
"EBITDA to Interest Ratio" of any Person on any date means the ratio of (a)
EBITDA for the period of four fiscal quarters of such Person ended on or
immediately prior to such date to (b) interest payable on, and amortization of
debt discount in respect of, all Debt of such Person for the period of four
fiscal quarters of such Person ended on or immediately prior to such date,
provided that for purposes of clause (b) of this definition, Debt shall not
include the obligations specified in clause (g) of the definition thereof set
forth above.
"Effective Date" has the meaning specified in Section 3.01.
"Eligible Assignee" means any Lender, any Affiliate of a Lender, and any other
Person approved by the Majority Lenders and the Borrower.
"Environmental Action" means any action, suit, demand, demand letter, claim,
notice of non-compliance or violation, notice of liability or potential
liability, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law, Environmental Permit or Hazardous
Materials or arising from alleged injury or threat of injury to health, safety
or the environment, including, without limitation, (a) by any governmental or
regulatory authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory authority or
any third party for damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.
"Environmental Law" means any federal, state, local (including the Commonwealth
of Puerto Rico) or foreign statute, law, ordinance, rule, regulation, code,
order, judgment, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, health, safety or
natural resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or discharge of
Hazardous Materials and including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act, the Resource
Conservation and Recovery Act, the Hazardous Materials Transportation Act, the
Clean Water Act, the Toxic Substances Control Act, the Clean Air Act, the Safe
Drinking Water Act, the Atomic Energy Act, the Federal Insecticide, Fungicide
and Rodenticide Act and the Occupational Safety and Health Act, each as amended
from time to time.
"Environmental Permit" means any permit, approval, identification number,
license or other authorization required under any Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of ERISA is a
member of the Loan Parties' controlled group, or under common control with the
Borrower, within the meaning of Section 414 of the Internal Revenue Code.
"ERISA Event" means (a) the occurrence of a reportable event, within the meaning
of Section 4043 of ERISA, with respect to any Plan unless the 30-day notice
requirement with respect to such event has been waived by the PBGC; (b) the
application for a minimum funding waiver with respect to a Plan; (c) the
provision by the administrator of any Plan of a notice of intent to terminate
such Plan pursuant to Section 4041(a)(2) of ERISA (including any such notice
with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d)
the cessation of operations at
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a facility of any of the Loan Parties or any ERISA Affiliate in the
circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by any
of the Loan Parties or any ERISA Affiliate from a Multiple Employer Plan during
a plan year for which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA; (f) the imposition of a lien under Section 302(f) of ERISA
with respect to any Plan; (g) the adoption of an amendment to a Plan requiring
the provision of security to such Plan pursuant to Section 307 of ERISA; or (h)
the institution by the PBGC of proceedings to terminate a Plan pursuant to
Section 4042 of ERISA, or the occurrence of any event or condition described in
Section 4042 of ERISA that is reasonably expected to result in the termination
of, or the appointment of a trustee to administer, a Plan.
"Eurocurrency Liabilities" has the meaning assigned to that term in Regulation D
of the Board of Governors of the Federal Reserve System, as in effect from time
to time.
"Eurodollar Rate Reserve Percentage" of any Lender for any Advance means the
reserve percentage applicable during the relevant Interest Period under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for such Lender with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities having a term equal
to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"GAAP" means (a) in the case of the preparation of all financial reporting
requirements, generally accepted accounting principles in the United States, as
in effect from time to time, and (b) in the case of the calculation,
certification and compliance with all financial tests and covenants, generally
accepted accounting principles in the United States, as in effect on the date of
the financial statements delivered to each Lender in accordance with Section
4.01(e), in each case applied on a consistent basis both as to classification of
items and amounts.
"GITI" means GTE International Telecommunications Incorporated, a Delaware
corporation.
"GTE" means GTE Corporation, a New York corporation, or its successor.
"Guaranteed Obligations" has the meaning specified in Section 7.01.
"Guarantors" has the meaning specified in the recital of parties to this
Agreement.
"Guaranty" has the meaning specified in Section 7.01.
"Hazardous Materials" means (a) petroleum and petroleum products, byproducts or
breakdown products, radioactive materials, asbestos-containing materials,
polychlorinated biphenyls and radon gas and (b) any other chemicals, materials
or substances designated, classified or regulated as hazardous or toxic or as a
pollutant or contaminant under any Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar agreements, interest
rate future or option contracts, currency swap agreements, currency future or
option contracts and other similar agreements.
"Interest Period" means, for each LIBOR Rate Advance comprising part of the same
Revolving Credit Borrowing, the period commencing on the date of such LIBOR Rate
Advance or the date of the Conversion of any Base Rate Advance into such LIBOR
Rate Advance and ending on the last day of the period selected by the Borrower
pursuant
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to the provisions below and, thereafter, with respect to such LIBOR Rate
Advances, each subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of the period selected by
the Borrower pursuant to the provisions below. The duration of each such
Interest Period shall be one week or one, two, three or six months, as the
Borrower may, upon notice received by the Administrative Agent not later than
11:00 A.M. (Puerto Rico Time) on the third Business Day prior to the first day
of such Interest Period, select; provided, however, that:
(i) the Borrower may not select any Interest Period that ends after the
Termination Date;
(ii) Interest Periods commencing on the same date for LIBOR Rate Advances
comprising part of the same Revolving Credit Borrowing shall be of the same
duration;
(iii) whenever the last day of any Interest Period would otherwise occur on a
day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, provided, however, that,
if such extension would cause the last day of such Interest Period to occur in
the next following calendar month, the last day of such Interest Period shall
occur on the next preceding Business Day; and
(iv) whenever the first day of any Interest Period occurs on a day of an initial
calendar month for which there is no numerically corresponding day in the
calendar month that succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such Interest Period
shall end on the last Business Day of such succeeding calendar month.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.
"LIBOR Lending Office" means, with respect to any Lender, the office of such
Lender specified as its "LIBOR Lending Office" opposite its name on Schedule I
hereto or opposite its name in the Assignment and Acceptance pursuant to which
it became a Lender or such other office of such Lender as such Lender may from
time to time specify to the Borrower and the Administrative Agent.
"LIBOR Rate" means, for any Interest Period for each Advance comprising part of
the same Revolving Credit Borrowing, an interest rate per annum equal to the
rate per annum obtained by dividing (a) the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not such a
multiple) of the rate per annum at which deposits in U.S. dollars are offered by
Citibank, N.A., to prime banks in the London interbank market at 11:00 A.M.
(London time) two Business Days before the first day of such Interest Period in
an amount approximately equal to the Advance comprising part of such Borrowing
to be outstanding during such Interest Period and for a period equal to such
Interest Period by (b) a percentage equal to 100% minus the Eurodollar Rate
Reserve Percentage for such Interest Period, if any. The Eurodollar Rate for any
Interest Period for each Advance comprising part of the same Borrowing shall be
determined by the Administrative Agent on the basis of applicable rates
furnished to and received by the Administrative Agent from Citibank, N.A. two
Business Days before the first day of such Interest Period.
"LIBOR Rate Advance" means a Revolving Credit Advance that bears interest as
provided in Section 2.06(a)(ii).
"Lenders" means the Lenders and each Person that shall become a party hereto
pursuant to Section 9.07."Lien" means any lien, security interest or other
charge or encumbrance of any kind.
"Loan Documents" means this Agreement, the Revolving Credit Notes, and, on and
after the date of delivery thereof, each guarantee, mortgage, pledge, assignment
or other security instrument required to be delivered under the terms of this
Agreement or any other Loan Document, in each case as amended or otherwise
modified from time to time.
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"Loan Party" means each of the Borrower, the Guarantors and each other Person
(other than the Administrative Agent or any Lender) which is or becomes or,
under the terms of any Loan Document, is required to become a party to a Loan
Document.
"Majority Lenders" means at any time Lenders holding at least 51% of the then
aggregate unpaid principal amount of the Notes held by Lenders, or, if no such
principal amount is then outstanding, Lenders having at least 51% of the
Commitments.
"Material Adverse Change" means any material adverse change in the business,
condition (financial or otherwise), operations, performance, properties or
prospects of any Loan Party or any Loan Party and its Subsidiaries taken as a
whole.
"Material Adverse Effect" means a material adverse effect on (a) the ability of
any Loan Party to conduct its business on substantially the same basis as
conducted on the Effective Date, (b) the rights and remedies of the
Administrative Agent or any Lender under any Loan Document or (c) the ability of
any Loan Party to service its Debt obligations on a timely basis.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the preceding
five plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in Section
4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan Party or
any ERISA Affiliate and at least one Person other than such Loan Party and the
ERISA Affiliates or (b) was so maintained and in respect of which any Loan Party
or any ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA
in the event such plan has been or were to be terminated.
"Note" means a Revolving Credit Note.
"Notice of Revolving Credit Borrowing" has the meaning specified in Section
2.02(a).
"Other Taxes" has the meaning specified in Section 2.13(b).
"PBGC" means the Pension Benefit Guaranty Corporation (or any successor).
"Permitted Liens" means, with respect to any Person, (a) Liens for taxes,
assessments and governmental charges and levies to the extent not required to be
paid under Section 5.01(b) hereof; (b) pledges or deposits to secure obligations
under workers' compensation laws or similar legislation; (c) pledges or deposits
to secure performance in connection with bids, tenders, contracts (other than
contracts for the payment of money) or leases to which such Person is a party;
(d) deposits to secure public or statutory obligations of such Person; (e)
materialmen's, mechanics', carriers', workers', repairmen's or other like Liens
in the ordinary course of business, or deposits to obtain the release of such
Liens to the extent such Liens, in the aggregate, would not have a Material
Adverse Effect; (f) deposits to secure surety and appeal bonds to which such
Person is a party; (g) other pledges or deposits for similar purposes in the
ordinary course of business; (h) Liens created by or resulting from any
litigation or legal proceeding which at the time is currently being contested in
good faith by appropriate proceedings; (i) leases existing on property acquired,
in the ordinary course of business; (j) landlord's Liens under leases to which
such Person is a party; (k) zoning restrictions, easements, licenses, and
restrictions on the use of real property or minor irregularities in title
thereto, which do not materially impair the use of such property in the
operation of the business of such Person or the value of such property for the
purpose of such business; and (l) bankers' liens, rights of set-off or analogous
rights granted or arising by operation of law to any deposits held by or other
indebtedness owing by any lender or any affiliate thereof to or for the credit
or account of such person.
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"Permitted Receivables Financing" means any financing pursuant to which the
Borrower or any Subsidiary of the Borrower may sell, convey, or otherwise
transfer to a Receivables Subsidiary or any other Person (in the case of
transfer by a Receivables Subsidiary), or grant a security interest in, any
accounts receivable (and related assets) of the Borrower or such Subsidiary,
provided that such financing shall be on customary market terms and shall be
non-recourse to the Borrower and its Subsidiaries (other than the Receivables
Subsidiary) except to a limited extent customary for such transactions. The
grant of a security interest in any accounts receivable of the Borrower or any
Subsidiary of the Borrower (other than a Receivables Subsidiary) to secure Debt
under any credit facility shall not be deemed a Permitted Receivables Financing.
"Person" means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint venture,
limited liability company or other entity, or a government or any political
subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Purchase" means the acquisition by GITI, directly or indirectly, of the
Controlling Interest.
"Receivables Subsidiary" means a bankruptcy-remote, special-purpose wholly owned
Subsidiary formed in connection with a Permitted Receivables Financing.
"Revolving Credit Advance" means an advance by a Lender to the Borrower as part
of a Revolving Credit Borrowing and refers to a Base Rate Advance or a LIBOR
Rate Advance.
"Revolving Credit Borrowing" means a borrowing consisting of simultaneous
Revolving Credit Advances made by each of the Lenders pursuant to Section 2.01.
"Revolving Credit Note" means a promissory note of the Borrower payable to the
order of any Lender, in substantially the form of Exhibit A hereto, evidencing
the aggregate indebtedness of the Borrower to such Lender resulting from the
Revolving Credit Advances made by such Lender.
"S&P" means Standard & Poor's Ratings Group, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc.
"Significant Subsidiary" means at any time any Subsidiary, the assets of which,
in the aggregate, exceed $30,000,000, determined in accordance with GAAP.
"Single Employer Plan" means a single employer plan, as defined in Section
4001(a)(15) of ERISA, that (a) is maintained for employees of the Borrower or
any ERISA Affiliate and no Person other than the Loan Parties and the ERISA
Affiliates or (b) was so maintained and in respect of which any Loan Party or
any ERISA Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.
"Solvent" and "Solvency" mean, with respect to any Person on a particular date,
that on such date (a) the fair value of the property of such Person is greater
than the total amount of liabilities, including, without limitation, contingent
liabilities, of such Person, (b) the present fair salable value of the assets of
such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay such debts and
liabilities as they mature and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
such Person's property would constitute an unreasonably small capital. The
amount of contingent liabilities at any time shall be computed as the amount
that, in the light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability after taking into account any indemnification pursuant to the
terms of the Stock Purchase Agreement and any other agreements entered into in
connection therewith.
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"Stock Purchase Agreement" means the Amended and Restated Stock Purchase
Agreement dated as of May 27, 1998, as amended and restated as of July 21, 1998
and as further amended from time to time on or before the Effective Date, among
Puerto Rico Telephone Authority, Puerto Rico Telephone Company, GTE Holdings
(Puerto Rico) LLC and GITI.
"Subsidiary" of any Person means any corporation, partnership, joint venture,
limited liability company, trust or estate of which (or in which) more than 50%
of (a) the issued and outstanding capital stock having ordinary voting power to
elect a majority of the Board of Directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such limited
liability company, partnership or joint venture or (c) the beneficial interest
in such trust or estate, is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"Subsidiary Existing Debt" has the meaning specified in Section 5.02(d).
"System" means all hardware or software, or any system consisting of one or more
thereof, including, without limitation, any and all enhancements, upgrades,
customizations, modifications, maintenance and the like utilized by any Person
for the benefit of such Person to perform its obligations and to administer and
track, store, process, provide, and where appropriate, insert, true and accurate
dates and calculations for dates and spans with respect to the Revolving Credit
Advances.
"Taxes" has the meaning specified in Section 2.13(a).
"Termination Date" means the earlier of the date that is 364 days after the
Effective Date and the date of termination in whole of the Commitments pursuant
to Section 2.04 or 6.01.
"Type" means, as to any Revolving Credit Advance, whether such Advance is a Base
Rate Advance or a LIBOR Rate Advance, each of which shall constitute a type of
Advance under this Agreement.
"Voting Stock" means capital stock issued by a corporation, or equivalent
interests in any other Person, the holders of which are ordinarily, in the
absence of contingencies, entitled to vote for the election of directors (or
persons performing similar functions) of such Person, even if the right so to
vote has been suspended by the happening of such a contingency.
"Year 2000 Compliant" means the ability of a System to continue its normal
functions including and following January 1, 2000.
SECTION 1.02 Computation of Time Periods. In this Agreement in the computation
of periods of time from a specified date to a later specified date, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding".
SECTION 1.03 Accounting Terms. All terms of an accounting or financial nature
not specifically defined herein shall be construed in accordance with GAAP.
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01 The Revolving Credit Advances. Each Lender severally agrees, on the
terms and conditions hereinafter set forth, to make Revolving Credit Advances to
the Borrower from time to time on any Business Day during the period from the
Effective Date until the Termination Date in an aggregate amount not to exceed
at any time outstanding the amount set forth opposite such Lender's name on the
signature pages hereof, as such amount may be reduced pursuant to Section 2.04
(such Lender's "Commitment"). Each Revolving Credit Borrowing shall be in an
aggregate amount of $1,000,000 or an integral multiple of $1,000,000 in excess
thereof. Within the limits of this Section 2.01, the Borrower may borrow under
this Section 2.01, prepay pursuant to Section 2.09, reborrow
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under this Section 2.01 and may Convert Borrowings of one Type into Borrowings
of another Type as provided for in Section 2.08.
SECTION 2.02 Making the Revolving Credit Advances.
(a) Each Revolving Credit Borrowing shall be made on notice, given not later
than 11:00 A.M. (Puerto Rico Time) on the third Business Day prior to the date
of the proposed Revolving Credit Borrowing in the case of a Revolving Credit
Borrowing consisting of LIBOR Rate Advances or on the Business Day of the
proposed Revolving Credit Borrowing in the case of a Revolving Credit Borrowing
consisting of Base Rate Advances, by the Borrower to the Administrative Agent,
which shall give to each Lender prompt notice thereof by telecopier or telex.
Each such notice of a Revolving Credit Borrowing (a "Notice of Revolving Credit
Borrowing") shall be by telephone, confirmed immediately in writing, or
telecopier or telex in substantially the form of Exhibit B hereto, specifying
therein the requested (i) date of such Revolving Credit Borrowing, (ii) Type of
Advances comprising such Revolving Credit Borrowing, (iii) aggregate amount of
such Revolving Credit Borrowing, and (iv) in the case of a Revolving Credit
Borrowing consisting of LIBOR Rate Advances, initial Interest Period for each
such Revolving Credit Advance. Each Lender shall, before 12:00 noon (Puerto Rico
Time) on the date of such Revolving Credit Borrowing, make available for the
account of its Applicable Lending Office to the Administrative Agent at the
Administrative Agent's Account, in same day funds, such Lender's ratable portion
of such Revolving Credit Borrowing. After the Administrative Agent's receipt of
such funds and upon fulfillment of the applicable conditions set forth in
Article III, the Administrative Agent will make such funds available to the
Borrower at the Borrower's Account.
(b) Anything in subsection (a) above to the contrary notwithstanding, the
Borrower may not select LIBOR Rate Advances for any Revolving Credit Borrowing
if the aggregate obligation of the Lenders to make LIBOR Rate Advances shall
then be suspended pursuant to Section 2.07 or 2.11.
(c) Each Notice of Revolving Credit Borrowing shall be irrevocable and binding
on the Borrower. In the case of any Revolving Credit Borrowing consisting of
LIBOR Rate Advances, the Borrower shall indemnify each Lender against any loss,
cost or expense incurred by such Lender as a result of any failure to fulfill on
or before the date specified in such Notice of Revolving Credit Borrowing for
such Revolving Credit Borrowing the applicable conditions set forth in Article
III, including, without limitation, any loss (excluding loss of anticipated
profits), cost or expense incurred by reason of the liquidation or reemployment
of deposits or other funds acquired by such Lender to fund the Revolving Credit
Advance to be made by such Lender as part of such Revolving Credit Borrowing
when such Revolving Credit Advance, as a result of such failure, is not made on
such date.
(d) Unless the Administrative Agent shall have received notice from a Lender
prior to the time of any Revolving Credit Borrowing that such Lender will not
make available to the Administrative Agent such Lender's ratable portion of such
Revolving Credit Borrowing, the Administrative Agent may assume that such Lender
has made such portion available to the Administrative Agent on the date of such
Revolving Credit Borrowing in accordance with subsection (a) of this Section
2.02 and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If and to the
extent that such Lender shall not have so made such ratable portion available to
the Administrative Agent, such Lender and the Borrower severally agree to repay
to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Borrower, the interest rate
applicable at the time to Revolving Credit Advances comprising such Revolving
Credit Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If
such Lender shall repay to the Administrative Agent such corresponding amount,
such amount so repaid shall constitute such Lender's Revolving Credit Advance as
part of such Revolving Credit Borrowing for purposes of this Agreement and the
Borrower shall be relieved of its obligations to repay such amount under this
Section 2.02(d).
(e) The failure of any Lender to make the Revolving Credit Advance to be made by
it as part of any Revolving Credit Borrowing shall not relieve the other Lender
of its obligation hereunder to make its Revolving Credit Advance on the date of
such Revolving Credit Borrowing, but no Lender shall be responsible for the
failure of the
10
other Lender to make the Revolving Credit Advance to be made by such other
Lender on the date of any Revolving Credit Borrowing.
SECTION 2.03 Facility Fee. The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a facility fee on the aggregate amount of
such Lender's Commitment from the Effective Date until the Termination Date at a
rate per annum equal to 0.125%, payable in arrears quarterly on the last day of
each March, June, September and December, commencing on June 30, 2000, and on
the Termination Date.
SECTION 2.04 Termination or Reduction of the Commitments. The Borrower shall
have the right, upon at least three Business Days' notice to the Administrative
Agent, to terminate in whole or reduce ratably in part the unused portions of
the respective Commitments of the Lenders, provided that each partial reduction
shall be in the aggregate amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof.
SECTION 2.05 Repayment of Revolving Credit Advances. The Borrower shall repay to
the Administrative Agent for the ratable account of the Lenders on the
Termination Date the aggregate principal amount of the Revolving Credit Advances
then outstanding.
SECTION 2.06 Interest.
(a) Scheduled Interest. The Borrower shall pay interest on the unpaid principal
amount of each Revolving Credit Advance owing to each Lender from the date of
such Advance until such principal amount shall be paid in full, at the following
rates per annum:
(i) Base Rate Advances. During such periods as such Revolving Credit Advance is
a Base Rate Advance, a rate per annum equal at all times to the Base Rate in
effect from time to time, payable in arrears on the last day of such Interest
Period and, if such Interest Period has a duration of more than three months, on
each day that occurs during such Interest Period every three months from the
first day of such Interest Period, and on the date such Base Rate Advance shall
be Converted or paid in full.
(ii) LIBOR Rate Advances. During such periods as such Revolving Credit Advance
is a LIBOR Rate Advance, a rate per annum equal at all times during each
Interest Period for such Revolving Credit Advance to the sum of (x) the LIBOR
Rate for such Interest Period for such Revolving Credit Advance, plus (y) the
Applicable Margin, payable in arrears on the last day of such Interest Period
and, if such Interest Period has a duration of more than three months, on each
day that occurs during such Interest Period every three months from the first
day of such Interest Period and on the date such LIBOR Rate Advance shall be
Converted or paid in full.
(b) Default Interest. Upon the occurrence and during the continuance of an Event
of Default under Section 6.01(a), the Borrower shall pay interest on (i) the
unpaid principal amount of each Revolving Credit Advance owing to each Lender,
payable in arrears on the date such amount shall be paid in full and on demand
at a rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid on such Revolving Credit Advance pursuant to clause (a)(i)
or (a)(ii) above and (ii) to the fullest extent permitted by law, the amount of
any interest, fee or other amount payable hereunder that is not paid when due,
from the date such amount shall be due until such amount shall be paid in full,
payable in arrears on the date such amount shall be paid in full and on demand,
at a rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid on Revolving Credit Advances pursuant to clause (a)(i)
above.
SECTION 2.07 Interest Rate Determination. (a) The Administrative Agent shall
give prompt notice to the Borrower and the Lenders of the applicable interest
rate determined by the Administrative Agent for purposes of Section 2.06(a)(i)
or (ii). If, with respect to any LIBOR Rate Advances, any Lender notifies the
Administrative Agent that the LIBOR Rate for any Interest Period for such
Advances will not adequately reflect the cost to such Lender of making, funding
or maintaining their respective LIBOR Rate Advances for such Interest Period,
the Administrative Agent shall forthwith so notify the Borrower and the Lenders,
whereupon (i) each LIBOR Rate Advance will automatically, on the last day of the
then existing Interest Period therefor, Convert into a Base Rate Advance, and
(ii) the obligation of the Lenders to make, or to Convert Revolving Credit
Advances into, LIBOR Rate
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Advances shall be suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.
(b) If the Borrower shall fail to select the duration of any Interest Period for
any LIBOR Rate Advances in accordance with the provisions contained in the
definition of "Interest Period" in Section 1.01, the Administrative Agent will
forthwith so notify the Borrower and the Lenders and such Advances will
automatically, on the last day of the then existing Interest Period therefor,
Convert into Base Rate Advances.
(c) On the date on which the aggregate unpaid principal amount of LIBOR Rate
Advances comprising any Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $1,000,000, such Advances shall automatically Convert
into Base Rate Advances.
(d) Upon the occurrence and during the continuance of any Event of Default under
Section 6.01, (i) each LIBOR Rate Advance will automatically, on the last day of
the then existing Interest Period therefor, Convert into a Base Rate Advance and
(ii) the obligation of the Lenders to make, continue or to Convert Advances
into, LIBOR Rate Advances shall be suspended.
(e) If on any date the Administrative Agent is unable to determine the LIBOR
Rate for any LIBOR Rate Advances to be made on such date,
(i) the Administrative Agent shall forthwith notify the Borrower and the Lenders
that the interest rate cannot be determined for such LIBOR Rate Advances,
(ii) with respect to LIBOR Rate Advances, each such Advance will automatically,
on the last day of the then existing Interest Period therefor, Convert into a
Base Rate Advance (or if such Advance is then a Base Rate Advance, will Continue
as a Base Rate Advance), and
(iii) the obligation of the Lenders to make LIBOR Rate Advances or to Convert
Revolving Credit Advances into LIBOR Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 2.08 Optional Conversion of Revolving Credit Advances. The Borrower may
on any Business Day, upon notice given to the Administrative Agent not later
than 11:00 A.M. (Puerto Rico Time) on the third Business Day prior to the date
of the proposed Conversion and subject to the provisions of Sections 2.08 and
2.12, Convert all Revolving Credit Advances of one Type comprising the same
Borrowing into Revolving Credit Advances of the other Type; provided, however,
that any Conversion of LIBOR Rate Advances into Base Rate Advances shall be made
only on the last day of an Interest Period for such LIBOR Rate Advances and any
Conversion of Base Rate Advances into LIBOR Rate Advances shall be in an amount
not less than $1,000,000. Each such notice of a Conversion shall, within the
restrictions specified above, specify (i) the date of such Conversion, (ii) the
Revolving Credit Advances to be Converted and (iii) if such Conversion is into
LIBOR Rate Advances, the duration of the initial Interest Period for each such
Advance. Each notice of Conversion shall be irrevocable and binding on the
Borrower.
SECTION 2.09 Prepayments of Advances. The Borrower may, upon at least two
Business Days' notice to the Administrative Agent stating the proposed date and
aggregate principal amount of the prepayment, and if such notice is given the
Borrower shall, prepay the outstanding principal amount of the Revolving Credit
Advances comprising part of the same Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the principal
amount prepaid; provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount of $1,000,000 or an integral multiple of
$1,000,000 in excess thereof and (y) the Borrower shall be obligated to
reimburse the Lenders in respect thereof pursuant to Section 9.04(b).
SECTION 2.10 Increased Costs. (a) If, due to either (i) the introduction of or
any change in or in the interpretation of any law or regulation or (ii) the
compliance with any written guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost
12
to any Lender of agreeing to make or making, funding or maintaining LIBOR Rate
Advances (excluding for purposes of this Section 2.10 any such increased costs
resulting from (i) Taxes or Other Taxes (as to which Section 2.13 shall govern)
and (ii) changes in the basis of taxation of overall net income or overall gross
income by the United States or by the foreign jurisdiction or state under the
laws of which such Lender is organized or has its Applicable Lending Office or
any political subdivision thereof, then the Borrower shall from time to time,
upon demand by such Lender (with a copy of such demand to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender
additional amounts sufficient to compensate such Lender for such increased cost
(whether or not such increased costs arise prior to the receipt of written
notification from such central bank or other governmental authority); provided
that the Borrower shall not be required to pay any such increased costs to the
extent such increased costs accrued prior to the date that is six months prior
to the date of such notice. A certificate as to the amount of such increased
cost, submitted to the Borrower and the Administrative Agent by such Lender,
shall be conclusive and binding for all purposes, absent manifest error in the
calculation of such amount.
(b) If any Lender determines that compliance with any law or regulation or any
written guideline or request from any central bank or other governmental
authority (whether or not having the force of law) affects or would affect the
amount of capital required or expected to be maintained by such Lender or any
corporation controlling such Lender (excluding any reserves included in the
computation of the LIBOR Rate) and that the amount of such capital is increased
by or based upon the existence of such Lender's commitment to lend hereunder and
other commitments of this type (taking into consideration such Lender's policies
and the policies of any corporation controlling such Lender with respect to
capital adequacy) then, upon demand by such Lender (with a copy of such demand
to the Administrative Agent), the Borrower shall pay to the Administrative Agent
for the account of such Lender, from time to time as specified by such Lender,
additional amounts sufficient to compensate such Lender or such corporation
(whether or not such amounts arise prior to the receipt of written notification
from such central bank or other governmental authority) in the light of such
circumstances, to the extent that such Lender reasonably determines such
increase in capital to be allocable (in the proportion that such Lender's
Commitment hereunder bears to all of such Lender's commitments of this type) to
the existence of such Lender's commitment to lend hereunder; provided that the
Borrower shall not be required to compensate such Lender to the extent such
amounts arose prior to the date that is six months prior to such notice. A
certificate as to such amounts submitted to the Borrower and the Administrative
Agent by such Lender shall be conclusive and binding for all purposes, absent
manifest error in the calculation of such amounts.
(c) Any Lender claiming any additional amounts payable pursuant to this Section
2.10 agrees to use reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions) to minimize such additional amounts and to
change the jurisdiction of its Applicable Lending Office if the making of such a
change would avoid the need for, or reduce the amount of, any additional amounts
that may thereafter accrue and would not, in the reasonable judgment of such
Lender, be otherwise notably disadvantageous to such Lender. The Borrower shall
reimburse such Lender for such Lender's reasonable expenses incurred in
connection with such change or in considering such a change in an amount not to
exceed the Borrower's pro rata share of such expenses based on such Lender's
Commitment and Advances and the total lending commitments and loans of such
Lender to its similarly situated customers.
SECTION 2.11 Illegality. Notwithstanding any other provision of this Agreement,
if any Lender shall notify the Administrative Agent that the introduction of or
any change in or in the interpretation of any law or regulation makes it
unlawful, or any central bank or other governmental authority having relevant
jurisdiction asserts that it is unlawful, for any Lender or its Applicable
Office to perform its obligations hereunder to make LIBOR Rate Advances or to
fund or maintain LIBOR Rate Advances hereunder, (i) each LIBOR Rate Advance made
by such Lender will automatically, upon such demand, Convert into a Base Rate
Advance, as the case may be, and (ii) the obligation of such Lender to make
LIBOR Rate Advances or to Convert Revolving Credit Advances into LIBOR Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.
SECTION 2.12 Payments and Computations. (a) The Borrower shall make each payment
hereunder and under the Notes not later than 11:00 A.M. (Puerto Rico Time) on
the day when due in U.S. dollars to the Administrative Agent at the
Administrative Agent's Account in same day funds. The Administrative Agent will
promptly thereafter cause
13
to be distributed like funds relating to the payment of principal or interest or
facility fees ratably (other than amounts payable pursuant to Section 2.10 or
9.04(c)) to the Lenders for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other amount payable to
any Lender to such Lender for the account of its Applicable Lending Office, in
each case to be applied in accordance with the terms of this Agreement.
(b) All computations of interest and of facility fees shall be made by the
Administrative Agent on the basis of a year of 360 days, in each case for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or facility fees are payable.
Each determination by the Administrative Agent of an interest rate hereunder
shall be conclusive and binding for all purposes, absent manifest error in the
calculation of such interest rate.
(c) Whenever any payment hereunder or under the Notes shall be stated to be due
on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or facility fee, as the case
may be; provided, however, that, if such extension would cause payment of
interest on or principal of LIBOR Rate Advances to be made in the next following
calendar month, such payment shall be made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received notice from the Borrower
prior to the time on which any payment is due to the Lenders hereunder that the
Borrower will not make such payment in full, the Administrative Agent may assume
that the Borrower has made such payment in full to the Administrative Agent on
such date and the Administrative Agent may, in reliance upon such assumption,
cause to be distributed to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Borrower shall not have so
made such payment in full to the Administrative Agent, each Lender shall repay
to the Administrative Agent forthwith on demand such amount distributed to such
Lender together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Administrative Agent, at the Federal Funds Rate.
SECTION 2.13 Taxes. (a) Subject to subsections (e) and (f) below, any and all
payments by the Borrower hereunder or under the Notes shall be made, in
accordance with Section 2.12, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto imposed by the
Commonwealth of Puerto Rico, the United States or any political subdivision of
either (or in the case of any payments by or on behalf of the Borrower through
an account or branch outside the United States or the Commonwealth of Puerto
Rico or by or on behalf of the Borrower by a payor that is not a United States
person or not organized or resident in the Commonwealth of Puerto Rico such
payments shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto imposed by a foreign jurisdiction or
any political subdivision thereof), excluding, in the case of each Lender and
the Administrative Agent, taxes imposed on its overall net income, and franchise
taxes imposed on it in lieu of net income taxes (x) in the case of a Lender
pursuant to the laws of the jurisdiction (or any political subdivision or taxing
authority therein) in which it is organized or in which the principal office of
such Lender or Applicable Lending Office of such Lender is located, or (y) in
the case of any payment to the Administrative Agent in its capacity as
Administrative Agent, the jurisdiction (or any political subdivision or taxing
authority therein) in which it is organized or in which the principal office of
the Administrative Agent is located or in which the office designated by the
Administrative Agent to act as Administrative Agent is located (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "Taxes"). Subject to subsections (e) and (f) below,
if the Borrower shall be required by law to deduct any Taxes from or in respect
of any sum payable hereunder or under any Note to any Lender or the
Administrative Agent, (i) the sum payable shall be increased as may be necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.13) such Lender or the
Administrative Agent (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make such deductions and (iii) the Borrower shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law. Within 30 days after the date of any payment of Taxes, the
Borrower shall furnish to the Administrative Agent, at its address referred to
in Section 9.02, the original or a certified copy of a receipt evidencing
payment thereof. For purposes of this subsection (a) and subsection (e),
14
the terms "United States" and "United States person" shall have the meanings
specified in Section 7701 of the Internal Revenue Code.
(b) In addition, the Borrower agrees to pay any stamp or documentary taxes or
any other excise or property taxes, charges or similar levies that arise from
any payment made hereunder or under the Notes or from the execution, delivery or
registration of, performing under, or otherwise with respect to, this Agreement
or the Notes (hereinafter referred to as "Other Taxes").
(c) Subject to subsections (d), (e) and (f) below, the Borrower shall indemnify
each Lender and the Administrative Agent for the full amount of Taxes or Other
Taxes (to the extent not previously paid under subsection (a) or (b) above)
imposed on or paid by such Lender or the Administrative Agent (as the case may
be) on or with respect to any payment by or on account of any obligation of any
Loan Party hereunder or under any other Loan Document and any liability
(including penalties, interest and expenses but excluding any taxes imposed by
any jurisdiction on amounts which may be paid or payable by the Borrower to a
Lender or the Administrative Agent under this Section 2.13) arising therefrom or
with respect thereto whether or not such Taxes or Other Taxes were correctly or
legally imposed. This indemnification shall be made within 30 Business Days from
the date such Lender or the Administrative Agent (as the case may be) makes
written demand therefor. A certificate as to the amount of such payment or
liability, submitted to the Borrower and the Administrative Agent by such
Lender, shall be conclusive and binding for all purposes, absent manifest error
in the calculation of such amount or liability.
(d) Each Lender organized under the laws of a jurisdiction outside of the
Commonwealth of Puerto Rico from time to time as requested in writing by the
Borrower (but only so long as such Lender remains lawfully able to do so), shall
provide each of the Administrative Agent and the Borrower with two properly and
accurately completed and duly executed original copies of any form, document or
other certificate that is necessary for such Lender to be exempt from, or
entitled to a reduced rate of Taxes or payments hereunder or under the Notes or
for the Borrower to determine the applicable rate of deduction or withholding of
any Taxes. If any Lender which is organized under the laws of a jurisdiction
outside of the Commonwealth of Puerto Rico is unable to provide the
above-described forms, documents or other certificates for a relevant interest
period (or if the Lender's appropriate personnel responsible for providing the
forms, documents or other certificates actually become aware that the forms,
documents or other certificates provided by it are inaccurate), such Lender
shall notify the Borrower in writing prior to or immediately upon the
commencement of such relevant interest period.
(e) For any period with respect to which a Lender has failed to provide the
Borrower with the appropriate form, document or other certificate requested by
the Borrower in accordance with Section 2.13(d) (other than if such failure is
due to a change in law occurring subsequent to the date on which a form,
document or other certificate originally was required to be provided, or if such
form, document or other certificate is no longer required to establish an
exemption from the applicable tax), such Lender shall not be entitled to
indemnification under Section 2.13(a) or (c) with respect to Taxes by reason of
such failure and the Borrower shall be entitled to withhold Taxes from payments
to such Lender; provided, however, that should a Lender become subject to Taxes
because of its failure to deliver a form, document or other certificate required
hereunder, the Borrower shall take such steps at such Lender's expense as such
Lender shall reasonably request to assist such Lender to recover such Taxes.
(f) Notwithstanding anything else contained in this Section 2.13, the Borrower
shall only be required to pay additional sums with respect to Taxes (subject to
subsection (h) below) to a Lender (or the Administrative Agent, as the case may
be) pursuant to subsection (a) or (c) above if the obligation to pay such Taxes
results from such Lender's inability to obtain a complete exemption from Taxes
as a result of (i) any amendment to the laws (or any regulations thereunder), or
any amendment to, or change in, an interpretation or application of any such
laws or regulations by any legislative body, court, governmental agency or
regulatory authority adopted or enacted after the date hereof (or in the case of
an entity that becomes a Lender after the date hereof, the date such entity
becomes a Lender), (ii) an amendment, modification or revocation of any existing
applicable tax treaty ratified, enacted or amended after the date hereof (or in
the case of an entity that becomes a Lender after the date hereof, the date such
entity becomes a Lender), or (iii) the ratification of a new tax treaty ratified
after the date hereof (or in the case of an entity that becomes a Lender after
the date hereof, the date such entity becomes a Lender).
15
(g) In the event that the Borrower makes an additional payment under Section
2.13(a) or 2.13(c) for the account of any Lender and such Lender, in its sole
opinion, determines that it has finally and irrevocably received or been granted
a credit against, or relief or remission from, or repayment of, any tax paid or
payable by it in respect of or calculated with reference to the deduction or
withholding giving rise to such additional payment, such Lender shall, to the
extent that it determines that it can do so without prejudice to the retention
of the amount of such credit, relief, remission or repayment, pay to the
Borrower such amount as such Lender shall, in its sole opinion, have determined
is attributable to such deduction or withholding and will leave such Lender
(after such payment) in no worse position than it would have been had the
Borrower not been required to make such deduction or withholding. Nothing
contained herein shall (i) interfere with the right of a Lender to arrange its
tax affairs in whatever manner it thinks fit or (ii) oblige any Lender to claim
any tax credit or to disclose any information relating to its tax affairs or any
computations in respect thereof or (iii) require any Lender to take or refrain
from taking any action that would prejudice its ability to benefit from any
other credits, reliefs, remissions or repayments to which it may be entitled.
Each Lender and the Administrative Agent shall reasonably cooperate with the
Borrower at the Borrower's written request and sole expense, in contesting any
Taxes or Other Taxes the Borrower would bear pursuant to this Section 2.13,
provided, however, that (i) no tax return of such Lender or the Administrative
Agent is or would be held open as a result of such contest, (ii) neither such
Lender nor the Administrative Agent is required to reopen a tax year that has
already closed and (iii) such Lender and the Administrative Agent shall, in the
sole opinion of such Lender and the Administrative Agent, respectively, have
determined that such contest will leave such Lender and the Administrative
Agent, respectively, in no worse position than it would have been in had it not
contested such Taxes or Other Taxes. Nothing contained herein shall interfere
with the right of a Lender or the Administrative Agent to arrange its tax
affairs in whatever manner it thinks fit, if in the sole judgment of such Lender
or the Administrative Agent, such contest would be disadvantageous to such
Lender or the Administrative Agent. In pursuing a contest in the Lender's or the
Administrative Agent's name, such Lender or the Administrative Agent will be
represented by counsel of such Lender's or the Administrative Agent's choice,
and will defend against, settle or otherwise control the contest and will not
relinquish control or decision making over the contest.
(h) Any Lender claiming any additional amounts payable pursuant to this Section
2.13 agrees to use reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions) to minimize such additional amounts and to
change the jurisdiction of its LIBOR Lending Office if the making of such a
change would avoid the need for, or reduce the amount of, any additional amounts
that may thereafter accrue and would not, in the reasonable judgment of such
Lender, be otherwise notably disadvantageous to such Lender. The Borrower shall
reimburse such Lender for such Lender's reasonable expenses incurred in
connection with such change or in considering such a change in an amount not to
exceed the Borrower's pro rata share of such expenses based on such Lender's
Commitment and Advances to the Borrower and the total lending commitments and
loans of such Lender to its similarly situated customers.
SECTION 2.14 Use of Proceeds. The proceeds of the Advances shall be available
(and the Borrower agrees that it shall use such proceeds) solely for working
capital and general corporate purposes of the Borrower and its Subsidiaries,
provided that such proceeds shall not be used for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System).
SECTION 2.15 Sharing of Payments, Etc. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) on account of the Advances made by it (other than pursuant to
Section 2.10, 2.13, 9.04(c) or 9.07) in excess of its ratable share of payments
on account of the Advances obtained by all the Lenders, such Lender shall
forthwith purchase from the other Lenders such participations in the Advances
made by them as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and such Lender shall
repay to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's ratable share (according to the
proportion of the amount of such Lender's required repayment to the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section 2.15 may, to the fullest extent permitted
16
by law, exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
ARTICLE III CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01 Conditions Precedent to Effectiveness of Section 2.01. Section 2.01
of this Agreement shall become effective on and as of the first date (the
"Effective Date") on which the following conditions precedent have been
satisfied:
(a) There shall have occurred no Material Adverse Change since December 31,
1999.
(b) There shall exist no action, suit, investigation, litigation or proceeding
affecting any of the Loan Parties or any of their respective Subsidiaries
pending or threatened before any court, governmental agency or arbitrator that
(i) could be reasonably likely to have a Material Adverse Effect other than the
matters described on Schedule 3.01(b) hereto (the "Disclosed Litigation") or
(ii) is initiated by any Person other than a Lender in its capacity as a Lender
that purports to affect the legality, validity or enforceability of this
Agreement, any Note, any other Loan Document or the consummation of the
transactions contemplated hereby, and there shall have been no material adverse
change in the status, or financial effect on any Loan Party, of the Disclosed
Litigation from that described on Schedule 3.01(b) hereto.
(c) All governmental and third party consents and approvals necessary in
connection with the execution, delivery and performance of this Agreement, the
Notes and any other Loan Document shall have been obtained (without the
imposition of any conditions that could reasonably be expected to materially
adversely affect the ability of any Loan Party to perform its obligations
hereunder) and shall remain in effect, and no law or regulation shall be
applicable that restrains, prevents or imposes adverse conditions upon the
transactions contemplated hereby that could reasonably be expected to materially
adversely affect the ability of any Loan Party to perform its obligations
hereunder.
(d) The Borrower shall have paid all costs and expenses of the Administrative
Agent and the Lenders in connection with the preparation, negotiation, execution
and, if applicable, filing and recording of this Agreement and the other Loan
Documents (including the accrued fees and expenses of counsel to the
Administrative Agent and the Lenders) to the extent invoiced and subject to the
terms and conditions of Section 9.04(a) herein.
(e) The Borrower shall have notified each Lender and the Administrative Agent in
writing of the proposed Effective Date.
(f) On the Effective Date, the following statements shall be true and the
Administrative Agent shall have received for the account of each Lender a
certificate signed by a duly authorized officer of the Borrower, dated the
Effective Date, stating that:
(i) The representations and warranties contained in Section 4.01 are correct on
and as of the Effective Date, and
(ii) No event has occurred and is continuing that constitutes a Default.
(g) The Administrative Agent shall have received on or before the Effective Date
the following, each dated such day, in form and substance satisfactory to the
Administrative Agent and (except for the Revolving Credit Notes) in sufficient
copies for each Lender:
(i) The Revolving Credit Notes to the order of the Lenders, respectively.
(ii) Certified copies of the resolutions of the Board of Directors of each Loan
Party approving the transactions contemplated by this Agreement and the Notes
and of all documents evidencing other necessary corporate action and
governmental approvals, if any, with respect to this Agreement and such Notes.
17
(iii) A certificate of the Secretary or an Assistant Secretary of each Loan
Party certifying the names and true signatures of the officers of each Loan
Party authorized to sign this Agreement and the Notes and the other Loan
Documents to be delivered hereunder.
(iv) A certificate, in substantially the form of Exhibit C hereto, attesting to
the Solvency of each Loan Party after giving effect to the Borrowings
contemplated hereunder, from the chief financial officer of each such Loan
Party.
(v) A favorable opinion of ▇▇▇▇ ▇▇▇▇▇▇, Vice President and General Counsel for
the Loan Parties, substantially in the form of Exhibit D hereto.
(vi) Certificates of good standing dated not more than thirty (30) days prior to
the execution of this Agreement showing that each Loan Party is in good standing
in the Commonwealth of Puerto Rico, and a copy certified by the Secretary of
each Loan Party, dated not more than thirty (30) days prior to the date of
execution of this Agreement, of the Articles of Incorporation and By-Laws of
such Loan Party.
(vii) A certificate of a duly authorized officer of the Borrower certifying that
the Borrower and each of the Guarantors has in effect the insurance coverage
required pursuant to Section 5.01(c).
SECTION 3.02 Conditions Precedent to Each Revolving Credit Borrowing. The
obligation of each Lender to make a Revolving Credit Advance on the occasion of
each Revolving Credit Borrowing shall be subject to the conditions precedent
that the Effective Date shall have occurred and on the date of such Revolving
Credit Borrowing the following statements shall be true (and each of the giving
of the applicable Notice of Revolving Credit Borrowing and the acceptance by the
Borrower of the proceeds of such Revolving Credit Borrowing shall constitute a
representation and warranty by the Borrower that on the date of such Borrowing
such statements are true):
(a) the representations and warranties contained in Section 4.01 are correct in
all material respects on and as of the date of such Revolving Credit Borrowing,
before and after giving effect to such Revolving Credit Borrowing and to the
application of the proceeds therefrom, as though made on and as of such date,
and
(b) no event has occurred and is continuing, or would result from such Revolving
Credit Borrowing or from the application of the proceeds therefrom, that
constitutes a Default.
SECTION 3.03 Conditions Precedent to Initial Revolving Credit Borrowing In
addition to the conditions set forth in Section 3.02, the obligation of each
Lender to make a Revolving Credit Advance on the occasion of the initial
Revolving Credit Borrowing shall be subject to the condition that the
Administrative Agent shall have received a certificate of the Borrower, signed
on behalf of the Borrower by its President, its Chief Financial Officer, its
Treasurer, its Assistant Treasurer or any Vice President and dated the date of
the initial Revolving Credit Borrowing (the statements made in which certificate
shall be true on and as of the date of the initial Revolving Credit Borrowing),
certifying as to the truth of the representations and warranties contained in
the Loan Documents as though made on and as of the date of the initial Revolving
Credit Borrowing and the absence of any event occurring and continuing, or
resulting from the initial Revolving Credit Borrowing, that constitutes a
Default.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Representations and Warranties of the Borrower. In order to induce
the Lenders to make the Revolving Credit Advances hereunder, the Borrower makes
the following representations and warranties to the Lenders:
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(a) Each Loan Party is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation.
(b) The execution, delivery and performance by each Loan Party of this Agreement
and the Notes executed by it and the consummation of the transactions
contemplated hereby, are within such Loan Party's corporate powers, have been
duly authorized by all necessary corporate action, and do not contravene (i)
such Loan Party's charter or by-laws (or other equivalent organizational
documents) or (ii) any law or any material contractual restriction binding on or
affecting such Loan Party or, to the knowledge of such Loan Party's chief
executive officer, chief financial officer, treasurer or controller or any vice
president, any other contract the breach of which would limit the ability of any
Loan Party to perform its obligations under this Agreement or the Notes. No Loan
Party nor any Subsidiary of a Loan Party is in violation of any law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award
applicable to it, or in breach of any indenture, agreement, lease or instrument,
the violation or breach of which is reasonably likely to have a Material Adverse
Effect.
(c) No authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body or any other third party is
required for the due execution, delivery and performance by any Loan Party of
this Agreement or the Notes.
(d) This Agreement has been, and each of the Notes when delivered hereunder will
have been, duly executed and delivered by the Borrower. This Agreement has been
duly executed and delivered by each Guarantor. Assuming that this Agreement has
been duly executed by the Administrative Agent and each of the Lenders, this
Agreement is, and each of the Notes when delivered hereunder will be, the legal,
valid and binding obligation of the Borrower enforceable against the Borrower in
accordance with their respective terms. Assuming that this Agreement has been
duly executed by the Administrative Agent and each of the Lenders, this
Agreement is the legal, valid and binding obligation of each Guarantor
enforceable against each Guarantor in accordance with its terms.
(e) The Consolidated balance sheet of the Borrower (or its predecessor entities)
and its Subsidiaries as at December 31, 1999, and the related Consolidated
statements of income and cash flows of the Borrower (or its predecessor
entities) and its Subsidiaries for the fiscal year then ended, accompanied by an
opinion of Deloitte & Touche LP, independent public accountants, copies of which
have been furnished to each Lender, fairly and accurately represent the
Consolidated financial condition of the Borrower (or its predecessor entities)
and its Subsidiaries as at such date and the Consolidated results of the
operations of the Borrower (or its predecessor entities) and its Subsidiaries
for the period ended on such date, all in accordance with generally accepted
accounting principles consistently applied.
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(f) There is no pending or (to the knowledge of any Loan Party) threatened
action or proceeding, including, without limitation, any Environmental Action,
affecting any Loan Party or any of its Subsidiaries before any court,
governmental agency or arbitrator that is initiated by any Person other than a
Lender in its capacity as a Lender that purports to affect the legality,
validity or enforceability of this Agreement or any Note.
(g) Neither the Borrower nor any of its Subsidiaries is an Investment Company,
as such term is defined in the Investment Company Act of 1940, as amended.
(h) No Loan Party is engaged in the business of extending credit for the purpose
of purchasing or carrying margin stock (within the meaning of Regulation U
issued by the Board of Governors of the Federal Reserve System), and no proceeds
of any Advance will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.
(i) As of the date hereof, the Borrower has no direct or indirect Significant
Subsidiaries, except as set forth in Schedule 4.01(i).
(j) The Borrower and the Guarantors are Solvent.
(k) Each Loan Party and each of its respective Subsidiaries have filed all
federal, state, commonwealth and local tax returns required to be filed and have
paid all taxes shown thereon to be due, including interest and penalties, or
have provided adequate reserves therefor; no unpaid or uncontested assessments
have been made against any Loan Party or any Subsidiary of any Loan Party by any
taxing authority, nor has any unpaid or uncontested penalty or deficiency been
assessed by any such authority, and all contested assessments have been
disclosed to the Administrative Agent and adequate reserves have been made
therefor. Such tax returns properly reflect the income and taxes of each
respective Loan Party and its Subsidiaries for the periods covered thereby,
subject only to reasonable adjustments required by the corresponding taxing
authorities upon audit or other adjustments not reasonably likely to have a
Material Adverse Effect.
(l) No Loan Party is subject to any labor dispute with its employees which is
reasonably likely to have a Material Adverse Effect.
(m) No written information, exhibit or report furnished by any Loan Party to the
Administrative Agent or any Lender in connection with the negotiation of this
Agreement contained any material misstatement of fact or omitted to state a
material fact necessary to make the statements contained therein not misleading.
(n) The operations and properties of each Loan Party comply in all material
respects with all applicable Environmental Laws; all necessary Environmental
Permits have been obtained and are in effect for the operations and properties
of each Loan Party, and each Loan Party is in compliance in all material
respects with all such Environmental Permits; none of the operations or
properties of any Loan Party is subject to any Environmental Action alleging the
violation of any Environmental Law; none of the operations of any Loan Party are
the subject of a federal, state, commonwealth or local investigation evaluating
whether any remedial action is needed to respond to a release of any hazardous
or toxic waste, substance or constituent, or any other substance into the
environment, which Environmental Action or remedial action is reasonably likely
to have a Material Adverse Effect.
ARTICLE V COVENANTS OF THE LOAN PARTIES
SECTION 5.01 Affirmative Covenants. So long as any Advance shall remain unpaid
or any Lender shall have any Commitment hereunder, each Loan Party will:
(a) Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries to
comply, in all material respects, with all applicable laws, rules, regulations
and orders, such compliance to include, without limitation, compliance with
ERISA and Environmental Laws, except where the failure to so comply would not
have a Material Adverse Effect.
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(b) Payment of Taxes, Etc. Pay and discharge, and cause each of its Subsidiaries
to pay and discharge, before the same shall become delinquent, (i) all taxes,
assessments and governmental charges or levies imposed upon it or upon its
property and (ii) all lawful claims that, if unpaid, might by law become a Lien
upon its property; provided, however, that neither any Loan Party nor any of its
Subsidiaries shall be required to pay or discharge any such tax, assessment,
charge or claim that is being contested in good faith and by proper proceedings
and as to which appropriate reserves are being maintained, unless and until any
Lien resulting therefrom attaches to its property and becomes enforceable
against its other creditors and the aggregate of such Liens would have a
Material Adverse Effect.
(c) Maintenance of Insurance. Maintain, and cause each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar properties as such
Loan Party and such Subsidiaries in the same general areas in which such Loan
Party or such Subsidiary operates; provided, however, that such Loan Party and
its Subsidiaries may self insure to the extent consistent with prudent business
practice.
(d) Preservation of Corporate Existence, Etc. Preserve and maintain, and cause
each of its Subsidiaries to preserve and maintain, its corporate existence,
rights (charter and statutory) and franchises; provided, however, that each Loan
Party and its Subsidiaries may consummate any transaction permitted under
Section 5.02(b) and provided further that neither any Loan Party nor any of its
Subsidiaries shall be required to preserve any right or franchise if the senior
management of such Loan Party or of such Subsidiary shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
such Loan Party or such Subsidiary, as the case may be, and that the loss
thereof is not disadvantageous in any material respect to such Loan Party or
such Subsidiary or to the interests of the Lenders.
(e) Visitation Rights. During normal business hours and upon reasonable notice
from time to time, permit the Administrative Agent or any of the Lenders or any
agents or representatives thereof, to examine and make copies of and abstracts
from the records and books of account of (excluding any confidential
information), and visit the properties of, such Loan Party and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of such Loan
Party and any of its Subsidiaries with the appropriate representatives of such
Loan Party and together with the appropriate representatives of such Loan
Party's independent certified public accountants.
(f) Keeping of Books. Keep, and cause each of its Subsidiaries to keep, proper
books of record and account, in which full and correct entries shall be made of
all financial transactions and the assets and business of such Loan Party and
each such Subsidiary in accordance with GAAP, consistently applied and generally
accepted accounting principles in effect from time to time.
(g) Maintenance of Properties, Etc. Maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, its material properties that are used or
useful in the conduct of its business in good working order and condition,
ordinary wear and tear excepted and in material compliance with all applicable
standards and rules imposed by all governmental authorities with jurisdiction.
(h) Transactions with Affiliates. Conduct, and cause each of its Subsidiaries to
conduct, all transactions otherwise permitted under this Agreement with any of
their Affiliates, other than another Loan Party, (i) on terms that are fair and
reasonable and no less favorable to such Loan Party or such Subsidiary than it
would obtain in a comparable arm's-length transaction with a Person not an
Affiliate except where the failure to do so, in the aggregate, would not have a
Material Adverse Effect, (ii) as required by the Federal Communications
Commission's rules and regulations for transactions among affiliates or (iii) as
contemplated by the Management Agreement and the Technology Transfer Agreement
(each such agreement as defined in the Stock Purchase Agreement).
(i) Reporting Requirements. Furnish to the Administrative Agent with sufficient
copies for distribution to the Lenders:
(i) as soon as available and in any event within 60 days after the end of each
of the first three quarters of each fiscal year of the Borrower, the
Consolidated balance sheet of the Borrower and its Subsidiaries as of the end of
such quarter and the Consolidated statements of income and cash flows of the
Borrower and its Subsidiaries for the
21
period commencing at the end of the previous fiscal year and ending with the end
of such quarter, duly certified (subject to year-end audit adjustments) by the
chief financial officer, treasurer or controller of the Borrower as having been
prepared in accordance with generally accepted accounting principles and
certificates of the chief financial officer, treasurer or controller of the
Borrower as to compliance with the terms of this Agreement and setting forth in
reasonable detail the calculations necessary to demonstrate compliance with
Section 5.03, provided that in the event of any change in GAAP used in the
preparation of such financial statements, the Borrower shall also provide, if
necessary for the determination of compliance with Section 5.03, a statement of
reconciliation showing the calculations used for purposes of Section 5.03;
(ii) as soon as available and in any event within 120 days after the end of each
fiscal year of the Borrower, a copy of the annual audited report for such year
for the Borrower and its Subsidiaries, containing the Consolidated balance sheet
of the Borrower and its Subsidiaries as of the end of such fiscal year and the
Consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for such fiscal year, in each case accompanied by an opinion
acceptable to the Majority Lenders by Deloitte & Touche LP or other independent
public accountants of nationally recognized standing, provided that in the event
of any change in GAAP used in the preparation of such financial statements, the
Borrower shall also provide, if necessary for the determination of compliance
with Section 5.03, a statement of reconciliation showing the calculations used
for purposes of Section 5.03;
(iii) as soon as possible and in any event within five Business Days after the
occurrence of each Default continuing on the date of such statement, a statement
of the chief financial officer, treasurer or controller of the Borrower setting
forth details of such Default and the action that the Borrower has taken and
proposes to take with respect thereto;
(iv) promptly after the sending or filing thereof, copies of any quarterly and
annual reports and proxy solicitations that any Loan Party sends to any of its
security holders, and copies of any reports on Form 8-K that such Loan Party
files with the Securities and Exchange Commission (other than reports on Form
8-K filed solely for the purpose of incorporating exhibits into a registration
statement previously filed with the Securities and Exchange Commission);
(v) prompt notice of all actions and proceedings before any court, governmental
agency or arbitrator affecting any Loan Party or any of its Subsidiaries of the
type described in Section 3.01(b); and
(vi) such other information respecting any Loan Party or any of its Subsidiaries
as any Lender through the Administrative Agent may from time to time reasonably
request.
(j) Payment of Taxes, Etc. File, and cause its Subsidiaries to file, all
federal, state, commonwealth and local tax returns and other reports required by
law to be filed; maintain, and cause its Subsidiaries to maintain, adequate
reserves for the payment of all taxes, assessments, governmental charges and
levies imposed upon such Loan Party and its Subsidiaries, their income or their
profits; pay and discharge, and cause its Subsidiaries to pay and discharge, all
such taxes, assessments, governmental charges and levies imposed upon such Loan
Party and any of its Subsidiaries or against their respective properties prior
to the date on which penalties accrue, except to the extent that the same may be
contested by such Loan Party or such Subsidiary, as the case may be, in good
faith by appropriate proceedings and adequate reserves have been made therefor,
unless and until a Lien resulting therefrom attaches to its property and becomes
enforceable against its other creditors.
(k) Solvency. Continue, and cause each of its Subsidiaries, to be Solvent.
(l) Environmental Matters. Conduct its business and that of its Subsidiaries so
as to comply in all material respects with all applicable Environmental Laws and
Environmental Permits; provided, however, that nothing contained in this
subsection shall prohibit such Loan Party from contesting, in good faith by
appropriate legal proceedings, any such Environmental Law or Environmental
Permit or the interpretation or application thereof.
(m) Year 2000 Compliant. Maintain their System in a manner that permits such
System to be Year 2000 Compliant.
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SECTION 5.02 Negative Covenants. So long as any Advance shall remain unpaid or
any Lender shall have any Commitment hereunder, the Borrower will not:
(a) Liens, Etc. Create or suffer to exist, or permit any of its Subsidiaries to
create or suffer to exist, any Lien on or with respect to any of its properties,
whether now owned or hereafter acquired, or assign for security purposes (but
not in connection with a bona fide sale thereof), or permit any of its
Subsidiaries to assign for security purposes (but not in connection with a bona
fide sale thereof), any right to receive income; provided that nothing in this
Section 5.02 shall be construed to prevent or restrict the following:
(i) Permitted Liens,
(ii) purchase money Liens upon or in any real property or equipment acquired or
held by the Borrower or any of its Subsidiaries in the ordinary course of
business to secure the purchase price of such property or equipment or to secure
Debt incurred solely for the purpose of financing the acquisition of such
property or equipment, or Liens existing on such property or equipment at the
time of its acquisition or conditional sales or other similar title retention
agreements with respect to property hereafter acquired or extensions, renewals
or replacements of any of the foregoing for the same or a lesser amount,
provided, however, that no such Lien shall extend to or cover any properties of
any character other than the real property or equipment being acquired, and no
such extension, renewal or replacement shall extend to or cover any properties
not theretofore subject to the Lien being extended, renewed or replaced,
(iii) the Liens existing on the Effective Date and described on Schedule 5.02(a)
hereto,
(iv) Liens on property of a Person existing at the time such Person is merged
into or consolidated with the Borrower or any of its Subsidiaries; provided that
any such Liens that were created during the period immediately prior to such
merger, consolidation or acquisition were created in the ordinary course of
business of such Person and the Debt secured by such Liens does not exceed the
fair market value of the assets (including intangible assets) of such Person so
merged into or consolidated with the Borrower or any of its Subsidiaries,
(v) the replacement, extension or renewal of any Lien permitted by clauses (iii)
and (iv) above upon or in the same property theretofore subject thereto or the
replacement, extension or renewal (without increase in the amount or extension
of the final maturity date) of the Debt secured thereby,
(vi) Liens not otherwise permitted pursuant to clauses (i) through (v) above
securing obligations not to exceed at any one time the amount of $10,000,000;
and
(vii) Liens on property of a Receivables Subsidiary created in connection with a
Permitted Receivables Financing.
(b) Mergers, Etc. Merge or consolidate with or into, or convey, transfer, lease
or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to, any Person, or permit any of its Subsidiaries to do so,
except that (i) any Subsidiary of the Borrower may merge or consolidate with or
into, or dispose of assets to, any other Subsidiary of the Borrower, (ii) any
Subsidiary of the Borrower may merge into or dispose of assets to the Borrower,
and (iii) the Borrower may merge with any Subsidiary of GTE so long as the
surviving corporation assumes all obligations of the Borrower hereunder and
under the Notes, and provided, in each case, that no Default shall have occurred
and be continuing at the time of such proposed transaction or would result
therefrom.
(c) Accounting Changes. Make or permit, or permit any of its Subsidiaries to
make or permit, any change in accounting policies or reporting practices, except
(i) as required or permitted by generally accepted accounting principles or (ii)
where the effect of such change, together with all other changes in accounting
policies or reporting practices made pursuant to this clause (ii) since the
Effective Date, is immaterial to the Borrower and its Subsidiaries taken as a
whole.
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(d) Subsidiary Debt. Permit any of its Subsidiaries to create or suffer to
exist, any Debt other than:
(i) Debt owed to the Borrower or to a wholly owned Subsidiary of the Borrower
(it being understood that such Debt includes any Debt incurred (A) in connection
with the Purchase and (B) under any contribution agreement entered into by and
among the Borrower and the Guarantors in connection with the Purchase, the Bonds
and any of the Subsidiary Existing Debt ),
(ii) Debt which may be incurred in connection with the Subsidiaries' guarantee
of the Bonds or any refunding or refinancing, in whole or in part, of the Bonds.
(iii) Debt which may be borrowed and outstanding from time to time under the
credit agreements existing or contemplated on and as of the Effective Date and
described on Schedule 5.02(d) hereto (the "Subsidiary Existing Debt"), and any
Debt extending the maturity of, or refunding or refinancing, in whole or in
part, the Subsidiary Existing Debt, provided that the principal amount of such
Subsidiary Existing Debt shall not be increased above the principal amount
thereof outstanding immediately prior to such extension, refunding or
refinancing, and the direct and contingent obligors therefor shall not be
changed, as a result of or in connection with such extension, refunding or
refinancing,
(iv) unsecured Debt incurred in the ordinary course of business aggregating for
each of the Guarantors not more than $75,000,000 at any one time outstanding,
(v) Debt in respect of operating leases,
(vi) endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business, and
(vii) Debt incurred by a Receivables Subsidiary created in connection with a
Permitted Receivables Financing.
(e) Certain Obligations Respecting Subsidiaries. The Borrower will take such
action, and will cause each of its Significant Subsidiaries and any Significant
Subsidiary formed with the intent of merging with or into a Person that will be
a Significant Subsidiary subject to this provision to take such action, from
time to time as shall be necessary to ensure that all Significant Subsidiaries
of the Borrower are party to, as Loan Parties, the Guaranty provided in Article
VII hereof. Without limiting the generality of the foregoing, in the event that
the Borrower or any of its Significant Subsidiaries shall form or acquire any
new Significant Subsidiary, the Borrower or the respective Significant
Subsidiary will cause such new Significant Subsidiary to (A) become a party
hereto and to the Guaranty pursuant to a written instrument in form and
substance satisfactory to the Adminsistrative Agent, and (B) deliver such proof
of corporate action, incumbency of officers, opinions of counsel and other
documents relating to the foregoing as is consistent with those delivered by
each Loan Party pursuant to Article III hereof, or as any Lender or the
Administrative Agent shall have reasonably requested.
SECTION 5.03 Financial Covenants. So long as any Advance shall remain unpaid or
any Lender shall have any Commitment hereunder, the Borrower will:
(a) Debt to EBITDA Ratio. Maintain a Debt to EBITDA Ratio, as at the end of each
fiscal quarter of the Borrower, of not more than 4.0:1.0.
(b) EBITDA to Interest Ratio. Maintain an EBITDA to Interest Ratio, as at the
end of each fiscal quarter of the Borrower, of not less than 3.0:1.0.
ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01 Events of Default. If any of the following events ("Events of
Default") shall occur and be continuing:
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(a) The Borrower shall fail to pay any principal of any Advance when the same
becomes due and payable; or the Borrower shall fail to pay any interest on any
Advance within five Business Days after the same becomes due and payable; or any
fees or other amounts payable under this Agreement or any Note are not paid
within five Business Days after the same becomes due and payable; or
(b) Any representation or warranty made or deemed made by any Loan Party herein
or by any Loan Party (or any of its officers) in connection with this Agreement
shall prove to have been incorrect in any material respect when made or deemed
made; or
(c) (i) Any Loan Party shall fail to perform or observe any term, covenant or
agreement contained in Section 5.01(d), (e), (h),(i)(iii) or (i)(v), (k), (l),
5.02 or 5.03; (ii) any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in Section 5.01(i) (other than clauses (iii) and
(v) thereof) if such failure shall remain unremedied for five Business Days
after written notice thereof shall have been given to such Loan party by the
Administrative Agent or any Lender; or (iii) any Loan Party shall fail to
perform or observe any other term, covenant or agreement contained in this
Agreement on its part to be performed or observed if such failure shall remain
unremedied for 30 days after written notice thereof shall have been given to
such Loan Party by the Administrative Agent or any Lender; or
(d) Article VII is breached by any Guarantor or shall cease to be in full force
and effect or any Guarantor shall so state in writing; or
(e) The Borrower or any of its Subsidiaries shall fail to pay any principal of
or premium or interest on any Debt that is outstanding in a principal or, in the
case of Hedge Agreements net amount of at least $20,000,000 in the aggregate
(but excluding Debt outstanding hereunder) of the Borrower or such Subsidiary
(as the case may be) (the "Requisite Amount"), when the same becomes due and
payable (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the later of five
Business Days and the applicable grace period, if any, specified in the
agreement or instrument relating to such Debt; or any such Debt aggregating the
Requisite Amount shall be declared due and payable in accordance with its terms
or any other event shall occur or condition shall exist under any agreement or
instrument relating to any such Debt aggregating the Requisite Amount and shall
continue after the applicable grace period, if any, specified in such agreement
or instrument, if the effect of such event or condition is to accelerate the
maturity of such Debt; or any such Debt aggregating the Requisite Amount shall
be required to be prepaid or redeemed (other than by a regularly scheduled
required prepayment or redemption), purchased or defeased in accordance with its
terms, or any offer to prepay, redeem, purchase or defease such Debt shall be
required to be made in accordance with its terms, in each case prior to the
stated maturity thereof where the cause of such prepayment, redemption, purchase
or defeasance or offer therefore is the occurrence of an event or condition that
is premised on a material adverse deterioration of the financial condition,
results of operation or properties of the Borrower or any of its Subsidiaries,
provided that with respect to Debt aggregating the Requisite Amount of the types
described in clauses (h) or (i) of the definition of "Debt" and to the extent
such Debt relates to the obligations of any Person other than the Borrower or
any of its Subsidiaries, no Event of Default shall occur so long as the payment
of such Debt is being contested in good faith and by proper proceedings and as
to which appropriate reserves are being maintained; or any event shall occur or
condition shall exist under any agreement or instrument relating to any Debt
that is outstanding in a principal or in the case of Hedge Agreements net amount
of at least $40,000,000 and shall continue after the applicable grace period, if
any, specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or permit the acceleration of, the maturity of such
Debt; or
(f) Any Loan Party or any of its Subsidiaries shall generally not pay their
respective debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted by or against any
Loan Party or its Subsidiaries seeking to adjudicate it a bankrupt or insolvent,
or seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted
25
against it (but not instituted by it), either such proceeding shall remain
undismissed or unstayed for a period of 60 days, or any of the actions sought in
such proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, it or for any substantial part of its property) shall occur; or
any Loan Party or its Subsidiaries shall take any corporate action to authorize
any of the actions set forth in this subsection (f) under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors; or
(g) Any judgment or order for the payment of money in excess of $30,000,000
shall be rendered against any Loan Party or its Subsidiaries and enforcement
proceedings shall have been commenced by any creditor upon such judgment or
order for which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; provided, however, that any
such judgment or order shall not be an Event of Default under this Section
6.01(g) if and for so long as (i) (A) the amount of such judgment or order is
covered by a valid and binding policy of insurance between the defendant and the
insurer or insurers covering payment thereof, (B) such insurer shall be rated,
or, if more than one insurer, at least 90% of such insurers as measured by the
amount of risk insured, shall be rated, at least "A-" by A.M. Best Company or
its successor or its successors and (C) such insurer(s) has been notified of,
and has not disputed the claim made for payment of, the amount of such judgment
or order or (ii) (A) the amount of such judgment or order is covered by a valid
and binding indemnification agreement between the defendant and an indemnitor,
(B) such indemnitor shall have a rating for any class of its non-credit enhanced
long-term senior unsecured debt of not lower than BBB+ by S&P or Baa3 by ▇▇▇▇▇'▇
and (C) such indemnitor has been notified of, and has not disputed the claim
made for payment of, the amount of such judgment or order; or
(h) (i) After the Effective Date, GITI or any entity controlling GITI shall
cease for any reason to maintain, directly or indirectly, the Controlling
Interest; or (ii) any Person or two or more Persons acting in concert shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934),
directly or indirectly, of Voting Stock of GITI or other Person holding the
Controlling Interest (or other securities convertible into such Voting Stock)
representing more of the combined voting power of all Voting Stock of GITI or
such other Person than that owned by GTE or its Subsidiaries or ▇▇▇▇ Atlantic
Corporation as successor to or parent of GTE after the merger of GTE with ▇▇▇▇
Atlantic Corporation or any of its Subsidiaries; or (iii) GTE or its
Subsidiaries or ▇▇▇▇ Atlantic Corporation as successor to or parent of GTE after
the merger of GTE with ▇▇▇▇ Atlantic Corporation or any of its Subsidiaries
shall fail to have the ability to appoint a majority of the Board of Directors
of GITI or other Person holding the Controlling Interest or the business and
affairs of GITI or such other Person shall not be managed by or under the
direction of such Board of Directors; or (iv) the Borrower shall for any reason
cease to own 100% of the Voting Stock of either Guarantor; or
(i) Any Loan Party or its ERISA Affiliates shall incur, or shall be reasonably
likely to incur, liability that would have a Material Adverse Effect as a result
of one or more of the following: (i) the occurrence of any ERISA Event; (ii) the
partial or complete withdrawal of such Loan Party or its ERISA Affiliates from a
Multiemployer Plan; or (iii) the reorganization or termination of a
Multiemployer Plan; or
(j) Any material provision of any Loan Document after delivery thereof pursuant
to this Agreement shall for any reason (other than pursuant to the terms hereof
or thereof) cease to be valid and binding on or enforceable against any party to
it (other than the Administrative Agent or any Lender), or any such party shall
so state in writing.
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Majority Lenders, by notice to the Borrower,
declare the obligation of each Lender to make Advances to be terminated,
whereupon the same shall forthwith terminate, and (ii) shall at the request, or
may with the consent, of the Majority Lenders, by notice to the Borrower,
declare the Notes, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Notes, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower; provided, however, that in the
event of an actual or deemed entry of an order for relief with respect to any
Loan Party under the Federal Bankruptcy Code, (A) the obligation of each Lender
to make Advances shall automatically be terminated and (B) the Notes, all such
interest and all such
26
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.
ARTICLE VII GUARANTY
SECTION 7.01 Guaranty; Limitation of Liability. (a) In order to induce the
Lenders to extend credit to the Borrower hereunder, each Guarantor hereby
jointly and severally and unconditionally and irrevocably guarantees, as a
primary obligor and not merely as a surety, the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all obligations of
each other Loan Party now or hereafter existing under this Agreement or any
Note, whether for principal, interest, fees, expenses or otherwise (such
obligations, to the extent not paid by such Loan Party or specifically waived in
accordance with Section 9.01, being the "Guaranteed Obligations"), and agrees to
pay any and all expenses (including reasonable counsel fees and expenses)
incurred by the Administrative Agent or the Lenders in enforcing any rights
under this Article VII ("this Guaranty"). Without limiting the generality of the
foregoing, each Guarantor's liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by any Loan
Party to the Administrative Agent or any Lender under this Agreement or any Note
but for the fact that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving such
Loan Party.
(b) Each Guarantor and, by its acceptance of this Guaranty, the Administrative
Agent and each other Lender, hereby confirms that it is the intention of all
such parties that this Guaranty not constitute a fraudulent transfer or
fraudulent conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal,
state or Commonwealth of Puerto Rico law to the extent applicable to this
Guaranty. To effectuate the foregoing intention, the Administrative Agent, each
other Lender and each Guarantor hereby irrevocably agrees that the obligations
of each Guarantor under this Guaranty shall not exceed the greater of (A) the
benefit realized by such Guarantor from the proceeds of the Advances made from
time to time by the Borrower to such Guarantor and (B) the maximum amount that
will, after giving effect to such maximum amount and all other probable
contingent and fixed liabilities of such Guarantor that are relevant under
applicable law, and after giving effect to any collections from, rights to
receive contribution from, or payments made by or on behalf of the other
Guarantor in respect of the obligations of such other Guarantor under this
Guaranty, result in the obligations of such Guarantor under this Guaranty not
constituting a fraudulent transfer or fraudulent conveyance. For purposes
hereof, "Bankruptcy Law" means ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, or any similar
Federal, state or Commonwealth of Puerto Rico law for the relief of debtors.
(c) Each Guarantor agrees that in the event any payment shall be required to be
made to the Lenders under this Guaranty, such Guarantor will contribute, to the
maximum extent such that the contribution will not result in a fraudulent
transfer or fraudulent conveyance, such amounts to the other Guarantor so as to
maximize the aggregate amount paid to the Lenders under this Agreement and the
Notes.
SECTION 7.02 Guaranty Absolute. Each Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of this Agreement
and the Notes, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Administrative Agent or the Lenders with respect thereto. The obligations of
each Guarantor under this Guaranty are independent of the Guaranteed
Obligations, and a separate action or actions may be brought and prosecuted
against such Guarantor to enforce this Guaranty, irrespective of whether any
action is brought against the Borrower or the other Guarantor or whether the
Borrower or the other Guarantor is joined in any such action or actions. The
liability of each Guarantor under this Guaranty shall be irrevocable, absolute
and unconditional irrespective of, and, to the maximum extent permitted by law,
each Guarantor hereby irrevocably waives, any defenses it may now or hereafter
have in any way relating to, any or all of the following:
(a) any lack of validity or enforce ability of this Agreement or any agreement
or instrument relating hereto;
(b) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Guaranteed Obligations, or any other amendment or waiver
of or any consent to departure from this Agreement, any Note or any
27
other Loan Document, including, without limitation, any increase in the
Guaranteed Obligations resulting from the extension of additional credit to the
Borrower or otherwise;
(c) any taking, exchange, release or non-perfection of any collateral, or any
taking, release or amendment or waiver of or consent to departure from any other
guaranty, for all or any of the Guaranteed Obligations;
(d) any change, restructuring or termination of the corporate structure or
existence of the Borrower; or
(e) any other circumstance (including, without limitation, any statute of
limitations) or any existence of or reliance on any representation by the
Administrative Agent or any Lender that might otherwise constitute a defense
available to, or a discharge of, any Guarantor, the Borrower or any other
guarantor or surety other than payment when due.
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Administrative Agent or any Lender upon the
insolvency, bankruptcy or reorganization of the Borrower or either Guarantor or
otherwise, all as though such payment had not been made.
SECTION 7.03 Waiver. Each Guarantor hereby waives promptness, diligence, notice
of acceptance and any other notice with respect to any of the Guaranteed
Obligations and this Guaranty and any requirement that the Administrative Agent
or any Lender exhaust any right or take any action against the Borrower or any
other Person or any collateral. Each Guarantor acknowledges that it will receive
direct and indirect benefits from the financing arrangements contemplated herein
and that the waiver set forth in this Section 7.03 is knowingly made in
contemplation of such benefits. Each Guarantor hereby waives any right to revoke
this Guaranty, and acknowledges that this Guaranty is continuing in nature and
applies to all Guaranteed Obligations, whether existing now or in the future.
SECTION 7.04 Continuing Guaranty; Assignments. This Guaranty is a continuing
guaranty and shall (a) remain in full force and effect until the later of the
cash payment in full of the Guaranteed Obligations and all other amounts payable
under this Guaranty and the Termination Date, (b) be binding upon each
Guarantor, its successors and assigns and (c) inure to the benefit of and be
enforceable by the Lenders, the Administrative Agent and their successors,
transferees and assigns. Without limiting the generality of the foregoing clause
(c), any Lender may assign or otherwise transfer all or any portion of its
rights and obligations hereunder (including, without limitation, all or any
portion of its Commitment, the Advances owing to it and the Note or Notes held
by it) to any other Person, and such other Person shall thereupon become vested
with all the benefits in respect thereof granted to such Lender herein or
otherwise, in each case as provided in Section 9.07.
SECTION 7.05 Subrogation. Neither Guarantor will exercise any rights that it may
now or hereafter acquire against the Borrower or any other insider guarantor
that arise from the existence, payment, performance or enforcement of such
Guarantor's obligations under this Guaranty, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution or
indemnification and any right to participate in any claim or remedy of the
Administrative Agent or any Lender against the Borrower, the other Guarantor or
any other insider guarantor or any collateral, whether or not such claim, remedy
or right arises in equity or under contract, statute or common law, including,
without limitation, the right to take or receive from the Borrower, the other
Guarantor or any other insider guarantor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or security solely
on account of such claim, remedy or right, unless and until all of the
Guaranteed Obligations and all other amounts payable under this Guaranty shall
have been paid in full in cash and the Termination Date shall have occurred. If
any amount shall be paid to either Guarantor in violation of the preceding
sentence at any time prior to the later of the payment in full in cash of the
Guaranteed Obligations and all other amounts payable under this Guaranty and the
Termination Date, such amount shall be held in trust for the benefit of the
Administrative Agent and the Lenders and shall forthwith be paid to the
Administrative Agent to be credited and applied to the Guaranteed Obligations
and all other amounts payable under this Guaranty, whether matured or unmatured,
in accordance with the terms of this Guaranty, or to be held as collateral for
any Guaranteed Obligations or other amounts payable under this Guaranty
thereafter arising. If (i) either Guarantor shall make payment to the
Administrative Agent or any Lender of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations and all other amounts
28
payable under this Guaranty shall be paid in full in cash and (iii) the
Termination Date shall have occurred, the Administrative Agent and the Lenders
will, at such Guarantor's request and expense, execute and deliver to such
Guarantor appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to such Guarantor of
an interest in the Guaranteed Obligations resulting from such payment by such
Guarantor.
ARTICLE VIII THE ADMINISTRATIVE AGENT
SECTION 8.01 Authorization and Action. Each Lender hereby appoints and
authorizes the Administrative Agent to take such action as Administrative Agent
on its behalf and to exercise such powers and discretion under this Agreement as
are delegated to the Administrative Agent by the terms hereof, together with
such powers and discretion as are reasonably incidental thereto. As to any
matters not expressly provided for by this Agreement (including, without
limitation, enforcement or collection of the Notes), the Administrative Agent
shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Majority Lenders
and such instructions shall be binding upon all Lenders and all holders of
Notes; provided, however, that the Administrative Agent shall not be required to
take any action that exposes the Administrative Agent to personal liability or
that is contrary to this Agreement or applicable law. The Administrative Agent
agrees to give to each Lender prompt notice of each notice given to it by the
Borrower pursuant to the terms of this Agreement.
SECTION 8.02 Administrative Agent's Reliance, Etc. Neither the Administrative
Agent nor any of its directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by it or them under or in connection
with this Agreement, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the
Administrative Agent: (i) may consult with legal counsel (including counsel for
the Borrower), independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts; (ii) makes no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, warranties or representations
(whether written or oral) made in or in connection with this Agreement; (iii)
shall not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of this Agreement on the
part of the Borrower or to inspect the property (including the books and
records) of the Borrower except as specifically set forth in this Agreement;
(iv) shall not be responsible to any Lender for the due execution, legality,
validity, enforce ability, genuineness, sufficiency or value of this Agreement
or any other instrument or document furnished pursuant hereto; and (v) shall
incur no liability under or in respect of this Agreement by acting upon any
notice, consent, certificate or other instrument or writing (which may be by
telecopier, telegram or telex) believed by it to be genuine and signed or sent
by the proper party or parties.
SECTION 8.03 BBVPR and Affiliates. With respect to its Commitment, the Advances
made by it and the Note or Notes issued to it, BBVPR shall have the same rights
and powers under this Agreement as any other Lender and may exercise the same as
though it were not the Administrative Agent; and the term "Lender" or "Lenders"
shall, unless otherwise expressly indicated, include BBVPR in its individual
capacity. BBVPR and its Affiliates may accept deposits from, lend money to, act
as trustee under indentures of, accept investment banking engagements from and
generally engage in any kind of business with, any Loan Party, any of its
Subsidiaries and any Person who may do business with or own securities of any
Loan Party or any of its Subsidiaries, all as if BBVPR were not the
Administrative Agent and without any duty to account therefore to the Lenders.
SECTION 8.04 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on the financial statements referred to in Section 4.01 and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 8.05 Indemnification. The Lenders agree to indemnify the Administrative
Agent (to the extent not reimbursed by the Borrower), ratably according to the
respective principal amounts of the Revolving Credit Advances owed each of them
(or if no Revolving Credit Advances are at the time outstanding, ratably
according to
29
their Commitments), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed on, incurred
by, or asserted against the Administrative Agent in any way relating to or
arising out of this Agreement or any action taken or omitted by the
Administrative Agent under this Agreement, provided that no Lender shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Administrative Agent's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender agrees to reimburse the Administrative
Agent promptly upon demand for its ratable share of any out-of-pocket expenses
(including reasonable counsel fees) incurred by the Administrative Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that the Administrative
Agent is not reimbursed for such expenses by the Borrower.
SECTION 8.06 Successor Administrative Agent. The Administrative Agent may resign
at any time by giving written notice thereof to the Lenders and the Borrower and
may be removed at any time with or without cause by the Majority Lenders. Upon
any such resignation or removal, the Majority Lenders shall have the right to
appoint a successor Administrative Agent. If no successor Administrative Agent
shall have been so appointed by the Majority Lenders, and shall have accepted
such appointment, within 30 days after the retiring Administrative Agent's
giving of notice of resignation or the Majority Lenders' removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, which shall be a
commercial bank organized or licensed under the laws of the United States of
America or of any State thereof or the Commonwealth of Puerto Rico and having a
combined capital and surplus of at least $250,000,000. Upon the acceptance of
any appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and become
vested with all the rights, powers, discretion, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent, upon
appointment of such successor Administrative Agent, shall be discharged from its
duties and obligations under this Agreement. After any retiring Administrative
Agent's resignation or removal hereunder as Administrative Agent, the provisions
of this Article VIII shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement.
30
ARTICLE IX MISCELLANEOUS
SECTION 9.01 Amendments, Etc. No amendment or waiver of any provision of this
Agreement, the Notes or any other Loan Documents, nor consent to any departure
by any Loan Party therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Majority Lenders, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment, waiver or consent
shall, unless in writing and signed by all the Lenders, do any of the following
at any time: (i) waive any of the conditions specified in Article III, (ii)
change the percentage of the Commitments or of the aggregate unpaid principal
amount of the Notes or the Advances or the number of Lenders that shall be
required for the Lenders or any of them to take any action hereunder, (iii)
amend this Section 9.01, (iv) increase the Commitments of the Lenders or subject
the Lenders to any additional obligations, (v) reduce the principal of, or
interest on, the Notes, or any fees or other amounts payable hereunder, (vi)
postpone any date fixed for any payment of principal of, or interest on, the
Notes or any fees or other amounts payable hereunder, (vii) limit the liability
of any party under any Loan Document or (viii) modify the definition of the term
"Majority Lenders"; and provided, further, that no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent in addition to
the Lenders required above to take such action, affect the rights or duties of
the Administrative Agent under this Agreement or any other Loan Document.
SECTION 9.02 Notices, Etc. All notices and other communications provided for
hereunder shall be in writing (including telecopier communication) and mailed,
telecopied or delivered by hand or by courier,
if to the Borrower, at
Telecomunicaciones de Puerto Rico, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Chief Financial Officer
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to
▇▇▇▇ ▇▇▇▇▇▇
Vice President and General Counsel
Telecomunicaciones de Puerto Rico, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
if to PRTC, at
Puerto Rico Telephone Company, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Chief Financial Officer
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
31
with a copy to
▇▇▇▇ ▇▇▇▇▇▇
Vice President and General Counsel
Telecomunicaciones de Puerto Rico, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
if to CTI, at
Celulares Telefonica, Inc. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Chief Financial Officer
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to
▇▇▇▇ ▇▇▇▇▇▇
Vice President and General Counsel
Telecomunicaciones de Puerto Rico, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
if to any Lender, at its Applicable Lending Office specified opposite its name
on Schedule I hereto; and if to the Administrative Agent, at its address at ▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Banking
Division, (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇) or, as to any Loan Party or the
Administrative Agent, at such other address as shall be designated by such party
in a written notice to the other parties and, as to each other party, at such
other address as shall be designated by such party in a written notice to the
Borrower and the Administrative Agent. All such notices and communications
shall, when mailed or telecopied, be effective when deposited in the first class
mails or, in the case of international delivery, when deposited with mails or
couriers that deliver within two Business Days or telecopied, provided that
notices and communications to the Administrative Agent pursuant to Article II,
III or VIII shall not be effective until received by the Administrative Agent,
and provided, further, that notices and communications to any Person required to
be provided hereunder within five Business Days shall only be made by hand or
via telecopy or courier. Delivery by telecopier of an executed counterpart of
any amendment or waiver of any provision of this Agreement or the Notes or of
any Exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of a manually executed counterpart thereof.
SECTION 9.03 No Waiver; Remedies. No failure on the part of any Lender or the
Administrative Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 9.04 Costs and Expenses. The Borrower agrees to pay on demand all
reasonable out-of-pocket costs and expenses of the Administrative Agent and the
Lenders in connection with the preparation, execution, delivery, administration,
modification and amendment of this Agreement, the Notes and the other documents
to be delivered
32
hereunder, including, without limitation, the reasonable fees and expenses of
counsel for the Administrative Agent; provided that such costs and expenses
shall not in the aggregate be in excess of $30,000. The Borrower further agrees
to pay on demand all costs and expenses of the Administrative Agent and the
Lenders, if any (including, without limitation, reasonable counsel fees and
expenses), in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of this Agreement, the Notes and the other
documents to be delivered hereunder, including, without limitation, reasonable
fees and expenses of counsel for the Administrative Agent and each Lender in
connection with the enforcement of rights under this Section 9.04(a).
(a) The Borrower agrees to indemnify and hold harmless the Administrative Agent
and each Lender and each of their Affiliates and their officers, directors,
employees, agents and advisors (each, an "Indemnified Party") from and against
any and all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of, or in connection with the
preparation for a defense of, any investigation, litigation or proceeding
arising out of, related to or in connection with (i) the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of the
proceeds of the Advances or (ii) the actual or alleged presence of Hazardous
Materials on any property of the Borrower or any of their respective
Subsidiaries or any Environmental Action relating in any way to the Borrower or
any of their respective Subsidiaries, in each case whether or not such
investigation, litigation or proceeding is brought by any Loan Party, its
directors, shareholders or creditors or an Indemnified Party or any other Person
or any Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated, except to the extent such
claim, damage, loss, liability or expense (A) is found by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross negligence or
willful misconduct, (B) arises from disputes among two or more Lenders (but not
including any such dispute that involves a Lender to the extent such Lender is
acting in any different capacity (i.e., Administrative Agent or Arranger) under
the Credit Agreement or the Notes or to the extent that it involves the
Administrative Agent's syndication activities) or (C) arises from or relates to
a breach by such Indemnified Party of its obligations under this Agreement. The
Borrower also agrees not to assert any claim against the Administrative Agent,
any Lender, any of their Affiliates, or any of their respective directors,
officers, employees, attorneys and agents, on any theory of liability, for
special, indirect, consequential or punitive damages arising out of or otherwise
relating to the Notes, this Agreement, any of the transactions contemplated
herein or the actual or proposed use of the proceeds of the Advances.
(b) If any payment of principal of, or Conversion of, any LIBOR Rate Advance is
made by the Borrower (or pursuant to Section 9.01(b)) to or for the account of a
Lender other than on the last day of the Interest Period for such Advance, as a
result of a payment, prepayment or Conversion pursuant to this Agreement or
acceleration of the maturity of the Notes pursuant to Section 6.01, the Borrower
shall, upon demand by such Lender (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender any amounts required to compensate such Lender for any additional losses,
costs or expenses that it may reasonably incur as a result of such payment or
Conversion, including, without limitation, any loss (excluding loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance.
(c) Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in Sections
2.12 and 9.04 shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under the Notes.
SECTION 9.05 Right of Set-off. Upon the occurrence and during the continuance of
any Event of Default, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by such Lender or such Affiliate to or for the credit or the account
of any Loan Party against any and all of the obligations of such Loan Party now
or hereafter existing under this Agreement and the Note held by such Lender,
whether or not such Lender shall have made any demand under this Agreement or
such Note and although such obligations may be unmatured. Each Lender agrees
promptly to notify the applicable Loan Party after any such set-off and
application, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Lender and its
Affiliates under this Section are
33
in addition to other rights and remedies (including, without limitation, other
rights of set-off) that such Lender and its Affiliates may have.
SECTION 9.06 Binding Effect. This Agreement shall become effective (other than
Section 2.01, which shall only become effective upon satisfaction of the
conditions precedent set forth in Section 3.01) when it shall have been executed
by each Loan Party, the Administrative Agent and by each initial Lender and
thereafter shall be binding upon and inure to the benefit of each Loan Party,
the Administrative Agent and each Lender and their respective successors and
assigns, except that no Loan Party shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the
Majority Lenders.
SECTION 9.07 Assignments and Participations. Each Lender may assign to one or
more banks or other entities all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Commitments, the Advances, the Note or Notes held by it and the remaining Loan
Documents); provided, however, that (i) the amount of the Commitment of the
assigning Lender being assigned pursuant to each such assignment (determined as
of the date of the Assignment and Acceptance (as hereinafter defined) with
respect to such assignment) shall in no event be less than $1,000,000 (unless
such lesser amount is the entire amount of such assigning Lender's Commitment or
outstanding Advances) and shall be an integral multiple of $100,000, (ii) each
such assignment shall be to an Eligible Assignee or to an Affiliate of the
assignor, and (iii) the parties to each such assignment shall execute and
deliver to the Administrative Agent, an Assignment and Acceptance, together with
any Note or Notes subject to such assignment and a processing fee of $2,500.00.
Upon such execution, delivery and acceptance, from and after the effective date
specified in each Assignment and Acceptance, the assignee thereunder shall be a
party hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and the Lender assignor thereunder shall, to
the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).
(a) By executing and delivering an Assignment and Acceptance, the Lender
assignor thereunder and the assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any Loan
Party or the performance or observance by any Loan Party of any of their
respective obligations under this Agreement or any other instrument or document
furnished pursuant hereto; (iii) such assignee confirms that it has received a
copy of this Agreement, together with copies of the financial statements
referred to in Section 4.01(e) and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (iv) such assignee will, independently and
without reliance upon the Administrative Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee confirms that it is an
Eligible Assignee; (vi) such assignee appoints and authorizes the Administrative
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement and the other Loan Documents as are delegated to the
Administrative Agent by the terms hereof and thereof, together with such powers
as are reasonably incidental thereto; and (vii) such assignee agrees that it
will perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.
(b) Upon its receipt of an Assignment and Acceptance in substantially the form
of Exhibit E hereto (the "Assignment and Acceptance") executed by an assigning
Lender and an assignee representing that it is an Eligible Assignee, together
with any Note or Notes subject to such assignment, the Administrative Agent
shall, if such Assignment and Acceptance has been duly completed, (i) accept
such Assignment and Acceptance and (ii) give prompt notice thereof to the
Borrower. Within five (5) Business Days after its receipt of such notice, the
Borrower, at their own expense, shall execute and deliver to the Administrative
Agent, in exchange for the surrendered Note or
34
Notes, a new Note or new Notes to the order of such Eligible Assignee in an
amount equal to the Commitments assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder, a
new Note or new Notes to the order of the assigning Lender in an amount equal to
the Commitment(s) retained by it hereunder. Such new Note or Notes shall be in
an aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such Assignment
and shall otherwise be in substantially the form of Exhibit A.
(c) Each Lender may sell participations to one or more banks or other entities
(other than the Borrower or any of its Affiliates) in or to all or a portion of
its rights and obligations under this Agreement (including, without limitation,
all or a portion of its Commitment, the Advances owing to it and the Notes held
by it); provided, however, that (i) such Lender's obligations under this
Agreement (including, without limitation, its Commitment to the Borrower
hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement and (iv) the Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement, (v)
no participant under any such participation shall have any right to approve any
amendment or waiver of any provision of this Agreement or any Note, or any
consent to any departure by the Borrower therefrom, except that a Lender may
agree with a participant as to the manner in which the Lender shall exercise the
Lender's rights to approve any amendment, waiver or consent to the extent that
such amendment, waiver or consent would reduce the principal of, or interest on,
the Notes or any fees or other amounts payable hereunder, in each case to the
extent subject to such participation, or postpone any date fixed for any payment
of principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, in each case to the extent subject to such participation.
(d) Any Lender may at any time, without the consent of the Administrative Agent
or the Borrower, create a security interest in all or any portion of its rights
under this Agreement (including, without limitation, the Advances owing to it
and the Note or Notes held by it) in favor of any Federal Reserve Bank in
accordance with Regulation A of the Board of Governors of the Federal Reserve
System, provided, however, that no such assignment shall have the effect of
increasing the costs payable by the Borrower.
SECTION 9.08 Nondisclosure. None of the Administrative Agent, any Lender or any
Affiliate thereof shall disclose without the prior consent of the Borrower
(other than to the Administrative Agent, the other Lender or any such Affiliate,
their respective directors, employees, auditors, affiliates or counsel who shall
agree to be bound by the terms of this provision) any information with respect
to the Loan Parties or any Subsidiary thereof contained in financial statements,
projections or reports provided to the Administrative Agent, any Lender or any
Affiliate thereof by, or on behalf of, the Loan Parties or any Subsidiary,
provided that the Administrative Agent, any Lender or any Affiliate thereof may
disclose any such information (a) as has become generally available to the
public in a manner, or through actions, which do not violate the terms of this
Section 9.08, (b) to, or as may be required or appropriate in any report,
statement or testimony submitted to, any municipal, state or federal regulatory
body having or claiming to have jurisdiction over the Administrative Agent, any
Lender or any Affiliate thereof or to the Federal Reserve Board or the Federal
Deposit Insurance Corporation or similar organizations (whether in the United
States or elsewhere) or their successors, (c) as may be required or appropriate
in response to any summons or subpoena or in connection with any litigation, (d)
in order to comply with any law, order, regulation or ruling applicable to the
Administrative Agent, any Lender or any Affiliate thereof and (e) to a
prospective assignee and/or participant in the amounts outstanding hereunder or
under the Advances, provided, however, that such prospective assignee and/or
participant executes an agreement containing provisions substantially identical
to those contained in this Section 9.08 and which shall by its terms inure to
the benefit of the Borrower and provided, further, that to the extent
practicable, the Administrative Agent, each Lender and their respective
Affiliates shall use reasonable best efforts to provide prior written notice of
such disclosure to the Borrower.
SECTION 9.09 Governing Law. This Agreement and the Notes shall be governed by,
and construed in accordance with, the laws of the Commonwealth of Puerto Rico.
SECTION 9.10 Jurisdiction, Etc. Each of the Loan Parties hereby agrees that any
suit, action or proceeding with respect to this Agreement or the Notes, the
other Loan Documents or any other document executed hereunder to
35
which it is a party or any judgment entered by any court in respect thereof may
be brought in the United States District Court for the District of Puerto Rico
or in the Court of First Instance of Puerto Rico sitting in San ▇▇▇▇, as the
party commencing such suit, action or proceeding may elect in its sole
discretion; and each party hereto hereby irrevocably submits to the
non-exclusive jurisdiction of such court for the purpose of any such suit,
action, proceeding or judgment. Each party hereto further submits, for the
purpose of any such suit, action, proceeding or judgment brought or rendered
against it, to the appropriate courts of the jurisdiction of its domicile.
(a) Each of the Loan Parties hereby irrevocably consents to the service of
process in any suit, action or proceeding in such courts by the mailing thereof
by the Administrative Agent or any Lender by registered or certified mail,
postage prepaid, at its address set forth beneath its signature hereto. Nothing
herein shall in any way be deemed to limit the ability of the Administrative
Agent or any Lender to serve any such writs, process or summonses in any other
manner permitted by applicable law or to obtain jurisdiction over the Loan
Parties in such other jurisdictions, and in such manner, as may be permitted by
applicable law.
(b) Each of the Loan Parties hereby irrevocably waives any objection that it may
now or hereafter have to the laying of the venue of any suit, action or
proceeding arising out of or relating to this Agreement, the Notes or any
document executed hereunder brought in any such court and hereby further
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum.
SECTION 9.11 Waiver of Jury Trial. Each of the Borrower, the Guarantor, the
Administrative Agent and the Lenders hereby irrevocably waives all right to
trial by jury in any action, proceeding or counterclaim (whether based on
contract, tort or otherwise) arising out of or relating to this Agreement, the
Notes or the other Loan Documents or the actions of the Administrative Agent or
any Lender in the negotiation, administration, performance or enforcement
thereof.
SECTION 9.12 Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this Agreement by telecopier shall
be effective as delivery of a manually executed counterpart of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Revolving Credit
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
PUERTO RICO TELEPHONE TELECOMUNICACIONES DE PUERTO
COMPANY, INC., as Guarantor RICO, INC., as Borrower
By: By
------------------------------- -----------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇ ▇▇▇▇▇▇
Title: President and Chief Title: President and Chief Executive
Executive Officer
36
CELULARES TELEFONICA, INC., BANCO BILBAO VIZCAYA ARGENTARIA S.A.,
as Guarantor as Lender
By: By:
------------------------- -----------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Chief Title: Executive Vice President
Executive Officer
By:
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Executive Vice President
BANCO BILBAO VIZCAYA PUERTO RICO,
as Lender
By:
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President
By:
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
BANCO BILBAO VIZCAYA PUERTO RICO,
as Administrative Agent
By:
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President
By:
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Miranda
Title: Vice President
37
Commitment Lender
---------- ------
$31,000,000.00 Banco Bilbao Vizcaya Puerto Rico
$19,000,000.00 Banco Bilbao Vizcaya Argentaria S.A.
TOTAL: $50,000,000.00