Exhibit 10.3
EXECUTION COPY
================================================================================
CREDIT AGREEMENT
dated as of
May 14, 1999,
among
ALEC Holdings, Inc.,
Alaska Communications Systems Holdings, Inc.
(formerly ALEC Acquisition Corporation),
The Lenders Party Hereto,
THE CHASE MANHATTAN BANK,
as Administrative Agent
and Collateral Agent,
CANADIAN IMPERIAL BANK OF COMMERCE,
as Syndication Agent,
and
CREDIT SUISSE FIRST BOSTON,
as Documentation Agent
------------------------
CHASE SECURITIES INC.,
as Arranger
================================================================================
3
Page
----
ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness; Certain Equity Securities ................. 103
SECTION 6.02. Liens ................................................... 104
SECTION 6.03. Fundamental Changes ..................................... 106
SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions .......................................... 107
SECTION 6.05. Asset Sales ............................................. 109
SECTION 6.06. Sale and Leaseback Transactions ......................... 110
SECTION 6.07. Hedging Agreements ...................................... 110
SECTION 6.08. Restricted Payments; Certain Payments of
Indebtedness .......................................... 110
SECTION 6.09. Transactions with Affiliates ............................ 112
SECTION 6.10. Restrictive Agreements .................................. 113
SECTION 6.11. Amendment of Material Documents ......................... 114
SECTION 6.12. Interest Coverage Ratio ................................. 114
SECTION 6.13. Leverage Ratio .......................................... 117
SECTION 6.14. Capital Expenditures .................................... 119
SECTION 6.15. Fiscal Year ............................................. 120
ARTICLE VII
Events of Default ....................... 121
ARTICLE VIII
The Administrative Agent .................... 124
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices ................................................. 127
SECTION 9.02. Waivers; Amendments ..................................... 128
SECTION 9.03. Expenses; Indemnity; Damage Waiver ...................... 130
SECTION 9.04. Successors and Assigns .................................. 132
SECTION 9.05. Survival ................................................ 135
SECTION 9.06. Counterparts; Integration; Effectiveness ................ 136
SECTION 9.07. Severability ............................................ 136
SECTION 9.08. Right of Setoff ......................................... 136
SECTION 9.09. Governing Law; Jurisdiction; Consent to
Service of Process .................................... 137
SECTION 9.10. WAIVER OF JURY TRIAL .................................... 138
4
Page
----
SECTION 9.11. Headings ................................................ 138
SECTION 9.12. Confidentiality ......................................... 138
SECTION 9.13. Interest Rate Limitation ................................ 139
SECTION 9.14. Notice of Lenders' Right to ▇▇▇ ......................... 140
SCHEDULES:
Schedule 1.01 -- Mortgaged Property
Schedule 2.01 -- Commitments
Schedule 3.05(b) -- Operating Licenses
Schedule 3.05(c) -- Owned and Leased Real Property
Schedule 3.06 -- Disclosed Matters
Schedule 3.12 -- Subsidiaries
Schedule 3.13 -- Insurance
Schedule 3.18(d) -- Mortgage Filing Offices
Schedule 4.02(i) -- Outstanding FCC Appeal Periods
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.04 -- Investments
Schedule 6.10 -- Existing Restrictions
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Opinion of Borrower's Counsels
Exhibit C -- Form of Perfection Certificate
Exhibit D -- Form of Parent Guarantee Agreement
Exhibit E -- Form of Subsidiary Guarantee Agreement
Exhibit F -- Form of Indemnity, Subrogation and Contribution Agreement
Exhibit G -- Form of Pledge Agreement
Exhibit H -- Form of Security Agreement
CREDIT AGREEMENT dated as of May 14, 1999, among ALEC
HOLDINGS, INC., ALASKA COMMUNICATIONS SYSTEMS HOLDINGS, INC.
(formerly ALEC ACQUISITION CORPORATION), the LENDERS party
hereto, THE CHASE MANHATTAN BANK, as Administrative Agent,
CANADIAN IMPERIAL BANK OF COMMERCE, as Syndication Agent and
CREDIT SUISSE FIRST BOSTON CORPORATION, as Documentation
Agent.
In connection with the transactions contemplated by (a) the PTI
Purchase Agreement (such term and each other capitalized term used but not
defined in this introductory statement having the meaning assigned to such term
in Article I) and (b) the ATU Purchase Agreement, (i) the Sponsor will make the
Sponsor Equity Contribution (as provided herein), (ii) Holdings will issue or
have previously issued, as applicable, the Holdings Discount Debentures in a
private placement to DLJ Investment Partners, L.P., its investment affiliates or
other institutional investors, (iii) the Management Investors will make the
Management Equity Contribution, (iv) certain third-party investors reasonably
acceptable to the Administrative Agent may make the Investor Equity
Contribution, (v) Holdings will make the Holdings Contribution and (vi) (A) ALEC
Acquisition or other Wholly-Owned Subsidiaries will consummate the PTI
Acquisition for the PTI Purchase Price and (B) ACS or other Wholly-Owned
Subsidiaries will consummate the ATU Acquisition for the ATU Purchase Price.
Immediately prior to the Acquisitions, all of the outstanding capital stock of
Pacific Telecom Cellular of Alaska RSA #1, Inc., which owns a Fairbanks, Alaska
cellular system license, will be distributed to the Sellers.
The Acquisitions may be consummated simultaneously or on different
dates. If the Acquisitions are consummated simultaneously, then the Acquisitions
will be partially financed on the Closing Date with the proceeds of (a) (i)
$435,000,000 in aggregate principal amount of Term Loans and (ii) up to
$75,000,000 in aggregate principal amount of Revolving Loans and (b) the Senior
Subordinated Notes in an aggregate principal amount of not less than
$115,000,000.
If the Acquisitions are consummated on different dates and the First
Acquisition is the PTI Acquisition, then such Acquisition will be partially
financed on the Initial Closing Date with the proceeds of (a) (i) $90,000,000 in
aggregate principal amount of the Tranche A Term Loans, (ii) $85,000,000 in
aggregate principal amount of the
2
Tranche B Term Loans, (iii) $90,000,000 in aggregate principal amount of the
Tranche C Term Loans and (iv) up to $50,000,000 (subject to the limitations
described in Section 5.11) in aggregate principal amount of Revolving Loans and
(b) the net proceeds of the Senior Subordinated Notes in an aggregate principal
amount of not less than $115,000,000. If the Acquisitions are consummated on
different dates and the First Acquisition is the ATU Acquisition, then such
Acquisition will be partially financed on the Initial Closing Date with the
proceeds of (a) $60,000,000 in aggregate principal amount of the Tranche A Term
Loans, (b) $65,000,000 in aggregate principal amount of the Tranche B Term
Loans, (c) $70,000,000 in aggregate principal amount of the Tranche C Term Loans
and (d) up to $50,000,000 (subject to the limitations described in Section 5.11)
in aggregate principal amount of Revolving Loans.
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Acquired EBITDA" shall mean, with respect to any Acquired Entity or
Business or any Sold Entity or Business for any period, the Consolidated EBITDA
of such Entity or Business.
"Acquired Entity or Business" has the meaning assigned to such term
in the definition of the term Adjusted Consolidated EBITDA.
"Acquisitions" means the PTI Acquisition and the ATU Acquisition.
"Acquisition Documents" means the PTI Purchase Agreement, the ATU
Purchase Agreement and the other agreements and documents entered into pursuant
thereto or in connection therewith (other than the Loan Documents and the
Subordinated Debt Documents).
3
"ACS" means Alaska Communications Systems, Inc., a Delaware
corporation and a wholly owned subsidiary of the Borrower.
"Additional Equity Contribution" means a cash equity contribution by
Holdings to the Borrower in addition to the Holdings Contribution and in an
amount that will result in the percentage of the Borrower's total capitalization
(excluding cash on hand) represented by equity, determined on a pro forma basis
as of the Initial Closing Date, being not less than the percentage specified by
the Administrative Agent (which percentage will not be more than 35%), provided
that a percentage to be agreed upon of the Additional Equity Contribution will
be funded with the proceeds of common equity contributions to Holdings in
addition to the Sponsor Equity Contribution, Management Equity Contribution and
Investor Equity Contribution and the remainder of the Additional Equity
Contribution will be funded with the proceeds of the issuance of Holdings
Discount Debentures in addition to the Holdings Discount Debentures issued on
the Start Date or the Second Closing Date.
"Adjusted Consolidated EBITDA" shall mean, for any Person for any
period, Consolidated EBITDA of such Person for such period, calculated by (a)
including in the determination thereof the Acquired EBITDA of any Person,
property, business or asset acquired during such period pursuant to a
transaction permitted under Section 6.04 and not subsequently sold, transferred
or otherwise disposed of during such period to the extent acquired by the
Borrower or any Subsidiary during such period (each such Person, property,
business or asset acquired and not subsequently so disposed of, an "Acquired
Entity or Business"), based on the actual Acquired EBITDA of such Acquired
Entity or Business for such period (including the portion thereof occurring
prior to such acquisition) and (b) excluding in the determination thereof the
Acquired EBITDA of any Person, property, business or asset sold, transferred or
otherwise disposed of by the Borrower or any Subsidiary during such period (each
such Person, property, business or asset so sold or disposed of, a "Sold Entity
or Business") based on the actual Acquired EBITDA of such Sold Entity or
Business for such period (including the portion thereof occurring prior to such
sale, transfer or disposition).
"Adjusted Leverage Ratio" shall mean, on any date, the ratio of (a)
Total Debt as of such date to (b) Adjusted Consolidated EBITDA for the period of
four consecutive fiscal quarters of the Borrower most recently ended as of
4
such date, all determined on a consolidated basis in accordance with GAAP.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means The Chase Manhattan Bank, in its
capacity as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"Agents" means the Administrative Agent, the Syndication Agent, the
Collateral Agent and the Documentation Agent.
"ALEC Acquisition" means ALEC Acquisition Sub. Corp., a Delaware
corporation and a wholly owned subsidiary of the Borrower.
"Alaska Entities" means Telephone Utilities of Alaska, Inc.,
Telephone Utilities of the Northland, Inc., PTI Communications of Alaska, Inc.,
Pacific Telecom Cellular of Alaska PCS, Inc. and Pacific Telecom Cellular of
Alaska, Inc.
"Alternate Base Rate" means, for any day, a rate per annum equal to
the greatest of (a) the Prime Rate in effect on such day, (b) the Base CD Rate
in effect on such day plus 1% and (c) the Federal Funds Effective Rate in effect
on such day plus 1/2 of 1%. Any change in the Alternate Base Rate due to a
change in the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate, the Base CD Rate or the Federal Funds Effective Rate, respectively.
"Applicable Percentage" means, with respect to any Revolving Lender,
the percentage of the total Revolving Commitments represented by such Lender's
Revolving Commitment. If the Revolving Commitments have terminated or
5
expired, the Applicable Percentages shall be determined based upon the Revolving
Commitments most recently in effect, giving effect to any assignments.
"Applicable Rate" means, for any day (a) with respect to any Tranche
B Term Loan, the applicable Tranche B Rate, (b) with respect to any Tranche C
Term Loan, the applicable Tranche C Rate and (c) with respect to any ABR Loan or
Eurodollar Loan that is a Revolving Loan or a Tranche A Term Loan, or with
respect to the commitment fees payable hereunder, as the case may be, the
applicable rate per annum set forth below (i) if the Closing Date or the Second
Closing Date has occurred, on the table under the heading "Combined Table" or
(ii) if neither the Closing Date nor the Second Closing Date has occurred and
the PTI Acquisition is the First Acquisition, on the table under the heading
"PTI Acquisition", or (iii) if neither the Closing Date nor the Second Closing
Date has occurred and the ATU Acquisition is the First Acquisition, on the table
under the heading "ATU Acquisition", in each case under the caption "ABR
Spread", "Eurodollar Spread" or "Commitment Fee Rate", as the case may be, based
upon the Leverage Ratio as of the most recent determination date, provided that
until 180 days after the Start Date, the "Applicable Rate" for purposes of
clause (c) shall be the applicable rate per annum set forth below in Category 1:
Combined Table
ABR Eurodollar Commitment Fee
Leverage Ratio: Spread Spread Rate
--------------- ------ ------ ----
Category 1 1.75% 2.75% 0.50%
----------
Greater than or equal to
5.50 to 1.00
Category 2
----------
Less than 5.50 to 1.00 1.50% 2.50% 0.50%
but greater than or equal
to 5.00 to 1.00
Category 3
----------
Less than 5.00 to 1.00 1.25% 2.25% 0.375%
but greater than or equal
to 4.50 to 1.00
Category 4 1.00% 2.00% 0.375%
----------
Less than 4.50 to 1.00
6
ATU Acquisition
ABR Eurodollar Commitment Fee
Leverage Ratio: Spread Spread Rate
--------------- ------ ------ ----
Category 1
----------
Greater than or equal to 1.75% 2.75% 0.50%
4.25 to 1.00
Category 2
----------
Less than 4.25 to 1.00
but greater than or equal 1.50% 2.50% 0.50%
to 3.75 to 1.00
Category 3
----------
Less than 3.75 to 1.00
but greater than or equal 1.25% 2.25% 0.375%
to 3.25 to 1.00
Category 4 1.00% 2.00% 0.375%
----------
Less than 3.25 to 1.00
PTI Acquisition
ABR Eurodollar Commitment Fee
Leverage Ratio: Spread Spread Rate
--------------- ------ ------ ----
Category 1
----------
Greater than or equal to 1.75% 2.75% 0.50%
6.50 to 1.00
Category 2
----------
Less than 6.50 to 1.00
but greater than or equal 1.50% 2.50% 0.50%
to 5.50 to 1.00
Category 3
----------
Less than 5.50 to 1.00
but greater than or equal 1.25% 2.25% 0.375%
to 4.50 to 1.00
Category 4
----------
Less than 4.50 to 1.00 1.00% 2.00% 0.375%
For purposes of the foregoing, (i) the Leverage Ratio shall be
determined as of the end of each fiscal quarter of the Borrower's fiscal year
based upon the Borrower's consolidated financial statements delivered pursuant
to Section 5.01(a) or (b) and (ii) each change in the Applicable Rate resulting
from a change in the Leverage Ratio shall be effective during the period
commencing on and including the date of delivery to the Administrative Agent of
such consolidated financial statements indicating such change and ending on the
date immediately preceding the effective date of the next such change; provided
that the Leverage Ratio shall be deemed to be in Category 1 (A) at any time that
an Event of Default has occurred and is continuing or (B) at the option of the
Administrative Agent or at the request of the Required Lenders if the Borrower
fails to deliver the consolidated financial statements required to be delivered
by it pursuant to Section 5.01(a) or (b), during the period from the expiration
of the time
7
for delivery thereof until such consolidated financial statements are delivered.
"APUC" means the Alaska Public Utilities Commission.
"Assessment Rate" means, for any day, the annual assessment rate in
effect on such day that is payable by a member of the Bank Insurance Fund
classified as "well-capitalized" and within supervisory subgroup "B" (or a
comparable successor risk classification) within the meaning of 12 C.F.R. Part
327 (or any successor provision) to the Federal Deposit Insurance Corporation
for insurance by such Corporation of time deposits made in dollars at the
offices of such member in the United States; provided that if, as a result of
any change in any law, rule or regulation, it is no longer possible to determine
the Assessment Rate as aforesaid, then the Assessment Rate shall be such annual
rate as shall be determined by the Administrative Agent to be representative of
the cost of such insurance to the Lenders.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Exhibit A or any other form approved by the Administrative Agent.
"ATU Acquisition" means the acquisition by ACS or other Wholly-Owned
Subsidiaries of the Borrower from the Municipality of the ATU Business in
accordance with the ATU Purchase Agreement.
"ATU Business" means (x) the assets of Anchorage Telephone Utility
(also known as ATU Telecommunications) used in its business as a local exchange
carrier, (y) the outstanding capital stock of ATU Communications, Inc., MACtel,
Inc., ATU Long Distance, Inc. and Peninsula Cellular Services, Inc. and (z) the
ATU Minority Interests, in each case to be acquired by ACS pursuant to (and as
specified in) the ATU Purchase Agreement.
"ATU Minority Interests" means the minority interests in Alaska
Network Systems, Inc., Alaska Choice Television, L.L.C., Internet Alaska, Inc.,
and Security One, L.L.C.
"ATU Purchase Agreement" means the Asset Purchase Agreement, dated
as of October 20, 1998, by and between ACS and the Municipality.
8
"ATU Purchase Price" means an aggregate cash purchase price equal to
$295,000,000 (subject to certain purchase price adjustments in accordance with
the ATU Purchase Agreement).
"ATU Term Facilities Indebtedness" means the Tranche A Term Loans,
Tranche B Term Loans and Tranche C Term Loans drawn on the closing date of the
ATU Acquisition.
"Authorizations" means all applications, filings, reports,
documents, recordings and registrations with, and all validations, exemptions,
franchises, waivers, approvals, orders or authorizations, consents, licenses,
certificates and permits from any Governmental Authority.
"Base CD Rate" means the sum of (a) the Three-Month Secondary CD
Rate multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate.
"Board" means the Board of Governors of the Federal Reserve System
of the United States of America.
"Borrower" means Alaska Communications Systems Holdings, Inc.
(formerly ALEC Acquisition Corporation), a Delaware corporation.
"Borrowing" means (a) Loans of the same Class and Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect, or (b) a Swingline Loan.
"Borrowing Request" means a request by the Borrower for a Borrowing
in accordance with Section 2.03.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City or Alaska are authorized or
required by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"Capital Expenditures" means, for any period, (a) the additions to
property, plant and equipment and other capital expenditures of the Borrower and
its consolidated Subsidiaries that are (or would be) set forth in a consolidated
statement of cash flows of the Borrower for such period prepared in accordance
with GAAP and (b) Capital Lease Obligations incurred by the Borrower and its
consolidated Subsidiaries during such period.
9
"Capital Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Change in Control" means (a) the acquisition of ownership, directly
or indirectly, beneficially or of record, by any Person other than Holdings of
any Equity Interest in the Borrower; (b) prior to an IPO, the failure by the
Sponsor to own, directly or indirectly, beneficially and of record, Equity
Interests in Holdings representing at least a majority of each of the aggregate
ordinary voting power and aggregate equity value represented by the issued and
outstanding Equity Interests in Holdings; (c) after an IPO, the failure by the
Sponsor to own, directly or indirectly, beneficially and of record, Equity
Interests in Holdings representing at least 35% of each of the aggregate
ordinary voting power and the aggregate equity value represented by the issued
and outstanding Equity Interests in Holdings; (d) after an IPO, the acquisition
of ownership, directly or indirectly, beneficially or of record, by any Person
or group (within the meaning of the Securities Exchange Act of 1934 and the
rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof) other than the Sponsor, of Equity Interests representing more than
35% of either the aggregate ordinary voting power or the aggregate equity value
represented by the issued and outstanding Equity Interests in Holdings; (e)
occupation of a majority of the seats (other than vacant seats) on the board of
directors of Holdings by Persons who were neither (i) nominated by the board of
directors of Holdings, (ii) appointed by directors so nominated nor (iii)
designated or nominated by the Sponsor; (f) the acquisition of direct or
indirect Control of Holdings by any Person or group other than the Sponsor; or
(g) the occurrence of a "Change of Control", as defined in the Subordinated Debt
Documents or the Holdings Discount Indenture.
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
the Issuing Bank (or, for purposes of Section 2.15(b), by any lending office of
such Lender or by
10
such Lender's or the Issuing Bank's holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans,
Tranche A Term Loans, Tranche B Term Loans, Tranche C Term Loans or Swingline
Loans and, when used in reference to any Commitment, refers to whether such
Commitment is a Revolving Commitment, Tranche A Commitment, Tranche B Commitment
or Tranche C Commitment.
"Closing Date" means the date on which (a) the conditions specified
in Section 4.02 are satisfied (or waived in accordance with Section 9.02) and
(b) the drawing of the Term Facilities and the simultaneous consummation of the
Acquisitions occur.
"CNI" means CenturyTel of the Northwest, Inc., formerly known as
Pacific Telecom, Inc., a Washington corporation.
"CWI" means CenturyTel Wireless, Inc., formerly known as Century
Cellunet, Inc., a Louisiana corporation.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" means any and all "Collateral", as defined in any
applicable Security Document.
"Collateral Account" means a collateral account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, which shall be established pursuant to documentation
reasonably satisfactory to the Administrative Agent.
"Collateral Agent" shall have the meaning given such term in the
Security Agreement.
"Combined Purchase Price" means the PTI Purchase Price and the ATU
Purchase Price.
"Commitment" means a Revolving Commitment, Tranche A Commitment,
Tranche B Commitment or Tranche C Commitment, or any combination thereof (as the
context requires).
11
"Communications Law" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority
(including but not limited to the FCC and the APUC), relating in any way to the
offering or provision of communications.
"Communication Liability" means any liability, contingent or
otherwise (including any liability for damages, costs, fines, penalties or
indemnities), of Holdings, the Borrower or any Subsidiary directly or indirectly
resulting from or based upon (a) the violation of any Communications Law, (b)
the generation or use of communications, (c) exposure to communications or radio
frequency emissions or (d) any contract, agreement or other consensual agreement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Consolidated Cash Interest Expense" means, for any period,
Consolidated Interest Expense less the sum for such period of (a) non-cash
expenses for interest payable in kind, (b) to the extent included in
Consolidated Interest Expense, the amortization of fees paid by Holdings, the
Borrower or their Subsidiaries on or prior to the earlier of the Closing Date,
the Second Closing Date or December 31, 1999, in connection with the
Transactions and (c) the amortization of debt discounts, if any, or fees in
respect of Hedging Agreements, provided that there shall be included or
excluded, as applicable, in determining Consolidated Cash Interest Expense for
any period the cash interest expense (calculated in the same manner as
Consolidated Cash Interest Expense is calculated) for such period (including the
portion thereof accruing prior to the applicable acquisition or sale) of any
Acquired Entity or Business or Sold Entity or Business acquired or sold, as
applicable, during such period assuming any Indebtedness incurred or repaid in
connection with the acquisition or sale had been incurred or repaid on the first
day of such period.
"Consolidated EBIT" means, for any Person for any period,
Consolidated Net Income of such Person, before total interest expense (whether
cash or non-cash) and provisions for taxes based on income, and determined
without giving effect to any extraordinary gains included in determining
Consolidated Net Income for such Person for such period.
"Consolidated EBITDA" means, for any Person for any period,
Consolidated EBIT of such Person, adjusted by adding thereto, without
duplication, the amount of all
12
depreciation expense, amortization expense and other non-cash charges that were
deducted in determining Consolidated EBIT for such Person for such period.
"Consolidated Interest Expense" means, for any period, total
interest expense (including that attributable to Capital Lease Obligations in
accordance with GAAP), whether cash or non-cash, of Holdings, the Borrower and
the Subsidiaries determined on a consolidated basis with respect to all
outstanding Indebtedness of Holdings, the Borrower and the Subsidiaries,
including, without limitation, (a) all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing, (b) amortization of the net costs or benefits under Hedging
Agreements and amortization of the (c) interest-equivalent costs that are
associated with any payments made to obtain any Hedging Agreement, deferred
financing costs and any interest expense on deferred compensation arrangements
and any other non-cash interest to the extent included in total interest
expense.
"Consolidated Net Income" means, for any Person for any period, the
net income (or loss) after provision for taxes and before any pay-in-kind or
non-cash accumulating dividend on preferred stock of such Person and its
subsidiaries on a consolidated basis for such period taken as a single
accounting period, provided that there shall be excluded from such net income
(or loss) the income of any Person in which any other Person or Persons (other
than the Borrower or any Subsidiary or any director holding qualifying shares in
compliance with applicable law) owns or own aggregate Equity Interests
representing more than 50% of the outstanding Equity Interests in such Person
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or any of the Subsidiaries by such Person during such
period.
"Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Default" means any event or condition that constitutes an Event of
Default or that upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
13
"Disclosed Matters" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06.
"Disqualified Stock" means, with respect to any Person, any Equity
Interest that by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable) or upon the
happening of any event: (a) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise; (b) is convertible or exchangeable for
Indebtedness or Disqualified Stock; or (c) is redeemable at the option of the
holder thereof, in whole or in part, in each case on or prior to the first
anniversary of the Tranche C Maturity Date; provided, however, that any Equity
Interests that would not constitute Disqualified Stock but for the provisions
thereof giving holders thereof the right to require such Person to repurchase or
redeem such Equity Interests upon the occurrence of an "asset sale" or "Change
of Control" occurring prior to the first anniversary of the Tranche C Maturity
Date shall not constitute Disqualified Stock if the "asset sale" or "Change of
Control" provisions applicable to such Equity Interests are not more favorable
to the holders of such Equity Interests than the "asset sale" provisions and the
"Change of Control", provisions, respectively, contained in the Subordinated
Debt Documents.
"Documentation Agent" means Credit Suisse First Boston, in its
capacity as documentation agent for the Lenders hereunder.
"dollars" or "$" refers to lawful money of the United States of
America.
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by or with any Governmental
Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, Release or threatened Release of any
Hazardous Material or to public health and safety matters.
"Environmental Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
investigation and remediation, natural resource damages, fines, penalties or
indemnities), of Holdings, the Borrower or any Subsidiary directly or indirectly
resulting from or based upon (a) any actual or alleged violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or
14
disposal of any Hazardous Materials, (c) any actual or alleged exposure to any
Hazardous Materials, (d) the Release or threatened Release of any Hazardous
Materials or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Contributions" means, collectively, the Sponsor Equity
Contribution, the Management Equity Contribution, the Investor Equity
Contribution and the Holdings Contribution in respect of the Holdings Financing
Amount.
"Equity Contribution Date" means the earlier of (a) the date of
termination of or the failure of a condition to closing under the PTI Purchase
Agreement or (b) August 10, 1999.
"Equity Interests" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person and any
options warrants or other rights to acquire such Equity Interests, but excluding
any debt securities convertible into such Equity Interests.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan;
15
(f) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
VII.
"Excess Cash Flow" means, for any fiscal year, the sum (without
duplication) of:
(a) the consolidated net income (or loss) of Holdings, the Borrower
and its consolidated Subsidiaries for such fiscal year, after provision
for taxes, adjusted to exclude any gains or losses attributable to
Prepayment Events; plus
(b) depreciation, amortization and other non-cash charges or losses
deducted in determining such consolidated net income (or loss) for such
fiscal year; plus
(c) the sum of (i) the amount, if any, by which Net Working Capital
decreased during such period plus (ii) the net amount, if any, by which
the consolidated deferred revenues of Holdings, the Borrower and its
consolidated Subsidiaries increased during such period plus (iii) the
aggregate principal amount of Capital Lease Obligations and other
Indebtedness incurred during such period to finance Capital Expenditures,
to the extent that mandatory principal payments in respect of such
Indebtedness would, pursuant to clause (f) below, be deducted in
determining Excess Cash Flow when made; minus
(d) the sum of (i) any non-cash gains included in determining such
consolidated net income (or loss) for such fiscal year plus (ii) the
amount, if any, by which Net Working Capital increased during such fiscal
year plus (iii) the amount, if any, by which the consolidated deferred
revenues of Holdings, the Borrower and
16
its consolidated Subsidiaries decreased during such fiscal year; minus
(e) Capital Expenditures for such period, except to the extent such
Capital Expenditures are financed with the proceeds of asset dispositions
(including casualty and condemnation events) or with the proceeds of the
sale of equity by, or the contribution of equity to, Holdings, the
Borrower or any Subsidiary (other than to or by Holdings, the Borrower or
any Subsidiary); minus
(f) the aggregate principal amount of Indebtedness repaid or prepaid
by Holdings, the Borrower and its consolidated Subsidiaries during such
period, excluding (i) Indebtedness in respect of Revolving Loans,
Swing-line Loans and Letters of Credit (unless accompanied by a permanent
reduction of the Revolving Commitments), (ii) Term Loans prepaid pursuant
to Section 2.11(a), 2.11(c) or (d), (iii) repayments or prepayments of
Indebtedness financed by incurring other Indebtedness, to the extent that
mandatory principal payments in respect of such other Indebtedness would,
pursuant to this clause (f), be deducted in determining Excess Cash Flow
when made and (iv) Indebtedness referred to in clauses (iv) and (v) of
Section 6.01(a).
"Excluded Taxes" means, with respect to the Administrative Agent,
any Lender, the Issuing Bank or any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction described in clause (a) above and (c) in the case of a
Foreign Lender (other than an assignee pursuant to a request by the Borrower
under Section 2.19(b)), any withholding tax that (i) is in effect and would
apply to amounts payable to such Foreign Lender at the time such Foreign Lender
becomes a party to this Agreement (or designates a new lending office), except
to the extent that such Foreign Lender (or its assignor, if any) was entitled,
at the time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to any withholding tax
pursuant to Section 2.17(a), or (ii) is attributable to such Foreign Lender's
failure to comply with Section 2.17.
17
"FCC" means the United States Federal Communications Commission or
any successor agency thereof.
"Federal Funds Effective Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding 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 (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"First Acquisition" means, if the Acquisitions are consummated on
different dates, the first of the Acquisitions to be consummated and the
transactions related thereto.
"First Acquisition Indebtedness" means, if the Acquisitions are
consummated on different dates, whichever of the PTI Term Facilities
Indebtedness and the ATU Term Facilities Indebtedness is incurred first.
"First Acquisition Loan Parties" means Holdings, the Borrower and
the First Acquisition Subsidiary Loan Parties.
"First Acquisition Mortgaged Property" means any Mortgaged Property
owned by a First Acquisition Loan Party and acquired, directly or indirectly, in
connection with the First Acquisition.
"First Acquisition Subsidiary Loan Parties" means each Subsidiary
(a) in existence prior to the First Acquisition or (b) acquired, directly or
indirectly, by the Borrower in connection with the First Acquisition, in each
case that is not a Foreign Subsidiary.
"Foreign Lender" means any Lender that is organized under the laws
of a jurisdiction other than that in which the Borrower is located. For purposes
of this definition, the United States of America, each State thereof and
18
the District of Columbia shall be deemed to constitute a single jurisdiction.
"Foreign Subsidiary" means any Subsidiary that is organized under
the laws of a jurisdiction other than the United States of America or any State
thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Governmental Authority" means the government of the United States
of America, any other nation or any political subdivision thereof, whether state
or local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
"Guarantee Agreements" means the Parent Guarantee Agreement and the
Subsidiary Guarantee Agreement.
"Hazardous Materials" means all explosive or radioactive substances
or wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious
19
or medical wastes, and all substances or wastes of any nature regulated pursuant
to any Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"Holdings" means ALEC Holdings, Inc., a Delaware corporation.
"Holdings Contribution" means the purchase by Holdings of all the
newly issued and outstanding common stock of the Borrower for an amount in cash
paid to the Borrower equal to the aggregate amount of the Equity Contributions
plus the Holdings Financing Amount.
"Holdings Discount Debentures" means the discount debentures issued
by Holdings in connection with the Acquisitions pursuant to the Holdings
Discount Indenture for gross cash proceeds of not less than $25,000,000 in
accordance with Section 4.02(p) or 4.03(o), as applicable.
"Holdings Discount Indenture" means the indenture to be entered into
by Holdings in connection with the issuance of the Holdings Discount Debentures,
together with all instruments and other agreements entered into by Holdings in
connection therewith, all in form and substance satisfactory to the
Administrative Agent.
"Holdings Financing Amount" means an amount of not less than
$25,000,000.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid (excluding current accounts
payable and accrued expenses incurred in the ordinary course of business), (d)
all obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (e) all obligations of
such Person in respect of the deferred purchase price of property or services
(excluding current accounts payable and accrued expenses incurred in the
ordinary course of business), (f) all Indebtedness of others secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured
20
by) any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes and Other
Taxes.
"Indemnity, Subrogation and Contribution Agreement" means the
Indemnity, Subrogation and Contribution Agreement, substantially in the form of
Exhibit F, among the Borrower, the Subsidiary Loan Parties and the
Administrative Agent.
"Information Memorandum" means the Confidential Information
Memorandum dated February 9, 1999, as updated by the Memorandum dated April 27,
1999, relating to the Borrower and the Transactions.
"Initial Closing Date" means, if the Acquisitions are consummated on
different dates, the date on which (a) the conditions specified in Section 4.02
are satisfied (or waived in accordance with Section 9.02) and (b) the initial
drawing of the Term Facilities and the consummation of the First Acquisition
occur.
"Interest Coverage Ratio" shall have the meaning set forth in
Section 6.12.
"Interest Election Request" means a request by the Borrower to
convert or continue a Revolving Borrowing or Term Borrowing in accordance with
Section 2.07.
"Interest Payment Date" means (a) with respect to any ABR Loan
(other than a Swingline Loan), the last day of each March, June, September and
December, (b) with respect to any Eurodollar Loan, the last day of the Interest
Period applicable to the Borrowing of which such Loan is a part and, in the case
of a Eurodollar Borrowing with an Interest Period of more than three months'
duration, each day prior
21
to the last day of such Interest Period that occurs at intervals of three
months' duration after the first day of such Interest Period, and (c) with
respect to any Swingline Loan, the day that such Loan is required to be repaid.
"Interest Period" means, with respect to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter, as the Borrower may elect; provided, that (i) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
"Investor Equity Contribution" means the contribution of up to an
aggregate amount not to exceed $30,000,000 in cash to Holdings as common equity.
"IPO" means an underwritten public offering by Holdings of Equity
Interests of Holdings pursuant to a registration statement filed with the
Securities and Exchange Commission in accordance with the Securities Act of
1933, as amended.
"Issuing Bank" means The Chase Manhattan Bank, in its capacity as
the issuer of Letters of Credit hereunder, and its successors in such capacity
as provided in Section 2.05(i). The Issuing Bank may, in its discretion, arrange
for one or more Letters of Credit to be issued by Affiliates of the Issuing
Bank, in which case the term "Issuing Bank" shall include any such Affiliate
with respect to Letters of Credit issued by such Affiliate.
"LC Disbursement" means a payment made by the Issuing Bank pursuant
to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all
22
LC Disbursements that have not yet been reimbursed by or on behalf of the
Borrower at such time. The LC Exposure of any Revolving Lender at any time shall
be its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender.
"Letter of Credit" means any letter of credit issued pursuant to
this Agreement.
"Leverage Ratio" means, on any date, the ratio of (x) Total Debt on
such date to (y) Consolidated EBITDA for the period of four consecutive fiscal
quarters of the Borrower most recently ended as of such date, all determined on
a consolidated basis in accordance with GAAP.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market Service
(or on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"License Subsidiary" means a Subsidiary of the Borrower, the sole
purpose of which shall be to hold a single Operating License and to perform
functions incidental thereto.
23
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan Documents" means this Agreement and the Security Documents.
"Loan Parties" means Holdings, the Borrower and the Subsidiary Loan
Parties.
"Loans" means the loans made by the Lenders to the Borrower pursuant
to this Agreement.
"Management Equity Contribution" means a contribution by the
Management Investors of an aggregate amount not to exceed $5,000,000 in cash to
Holdings as common equity.
"Management Investors" means ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, operations or condition, financial or otherwise, of Holdings,
the Borrower and the Subsidiaries taken as a whole, (b) the ability of any Loan
Party to perform any of its obligations under any Loan Document or (c) the
rights of or benefits available to the Lenders under any Loan Document.
"Material Indebtedness" means Indebtedness (other than the Loans and
Letters of Credit), or obligations in respect of one or more Hedging Agreements,
of any one or more of Holdings, the Borrower and the Subsidiaries in an
aggregate principal amount exceeding $5,000,000. For purposes of determining
Material Indebtedness, the "principal amount" of the obligations of Holdings,
the Borrower or any Subsidiary in respect of any Hedging Agreement at any time
shall be the maximum aggregate amount (giving effect to any netting agreements)
that Holdings, the Borrower or such Subsidiary would be required to pay if such
Hedging Agreement were terminated at such time.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
24
"Mortgage" means a mortgage, deed of trust, assignment of leases and
rents, leasehold mortgage or other security document granting a Lien on any
Mortgaged Property to secure the Obligations. Each Mortgage shall be
satisfactory in form and substance to the Collateral Agent.
"Mortgaged Property" means, initially, each parcel of real property
and the improvements thereto owned by a Loan Party and identified on Schedule
1.01, and includes each other parcel of real property and improvements thereto
with respect to which a Mortgage is granted pursuant to Section 5.12 or 5.13.
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001 (a) (3) of ERISA.
"Municipality" means the Municipality of Anchorage, a municipality
located in the State of Alaska.
"Net Cash Amount" means the amount of cash and cash equivalents
included in the Assets (as defined in the ATU Purchase Agreement).
"Net Plant Amount" means the amount equal to the increase, if any,
in the ATU Purchase Price pursuant to Section 2.5(b) of the ATU Purchase
Agreement.
"Net Proceeds" means, with respect to any event, (a) the cash
proceeds received in respect of such event, including (i) any cash received in
respect of any non-cash proceeds, but only as and when received, (ii) in the
case of a casualty, insurance proceeds and (iii) in the case of a condemnation
or similar event, condemnation awards and similar payments, net of (b) the sum
of (i) all reasonable fees and out-of-pocket expenses paid by Holdings, the
Borrower and the Subsidiaries to third parties in connection with such event,
(ii) in the case of a sale, transfer or other disposition of an asset (including
pursuant to a sale and leaseback transaction or a casualty or a condemnation or
similar proceeding), the amount of all payments required to be made by Holdings,
the Borrower and the Subsidiaries as a result of such event to repay
Indebtedness (other than Loans) secured by such asset or otherwise subject to
mandatory prepayment as a result of such event, and (iii) the amount of all
taxes paid (or reasonably estimated to be payable) by Holdings, the Borrower and
the Subsidiaries, and the amount of any reserves established by Holdings, the
Borrower and the Subsidiaries to fund contingent liabilities reasonably
estimated to be payable, in each case during the year that such event occurred
or the next succeeding year and that are directly attributable to such event (as
deter-
25
mined reasonably and in good faith by the chief financial officer of the
Borrower).
"Net Working Capital" means, at any date, (a) the consolidated
current assets of Holdings, the Borrower and its consolidated Subsidiaries as of
such date (excluding cash and Permitted Investments) minus (b) the consolidated
current liabilities of Holdings, the Borrower and its consolidated Subsidiaries
as of such date (excluding current liabilities in respect of Indebtedness). Net
Working Capital at any date may be a positive or negative number. Net Working
Capital increases when it becomes more positive or less negative and decreases
when it becomes less positive or more negative.
"Obligations" has the meaning assigned to such term in (a) the
Security Agreement, (b) the Pledge Agreement and (c) the Guarantee Agreements.
"Operating Licenses" means all material licenses, permits and other
approvals issued by the FCC or APUC to the ATU Business, the Alaska Entities,
the Borrower or any Subsidiary, including any paging, mobile telephone,
specialized mobile radio, microwave or other license.
"Other Taxes" means any and all present or future recording stamp,
documentary, excise, transfer, sales, property or similar taxes, charges or
levies arising from any payment made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.
"Parent Guarantee Agreement" means the Parent Guarantee Agreement,
substantially in the form of Exhibit D, made by Holdings in favor of the
Administrative Agent for the benefit of the Secured Parties.
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.
"Perfection Certificate" means a certificate in the form of Exhibit
C or any other form approved by the Collateral Agent.
"Permitted Acquisition" means any acquisition, to the extent such
acquisition occurs after the earlier of the Closing Date, the Second Closing
Date and December 31, 1999, of all or substantially all the assets of, or shares
or other Equity Interests in, a Person or division or line of business of a
Person that is engaged in a reasonably related
26
(ancillary or complementary) line of business or lines of business, as
reasonably determined by the Board of Directors of the Borrower (or any
subsequent investment made in a previously acquired Permitted Acquisition), that
was not preceded by an unsolicited tender offer for such Person, if immediately
after giving effect thereto (a) no Default or Event of Default shall have
occurred and be continuing or would result therefrom, (b) all transactions
related thereto shall be consummated in accordance with applicable law, (c) 100%
of the Equity Interest of any acquired or newly formed corporation, partnership,
association or other business entity are owned directly by the Borrower or a
domestic Wholly Owned Subsidiary and all actions required to be taken, if any,
with respect to such acquired or newly formed subsidiary under Section 5.12
shall have been taken, and (d) (i) Holdings, the Borrower and the Subsidiaries
shall be in compliance, on a pro forma basis after giving effect to such
acquisition or formation, with the covenants contained in Sections 6.12 and 6.13
recomputed as at the last day of the most recently ended fiscal quarter of
Holdings, the Borrower and the Subsidiaries as if such acquisition had occurred
on the first day of each relevant period for testing such compliance, and the
Borrower shall have delivered to the Administrative Agent an officers'
certificate to such effect, together with all relevant financial information for
such subsidiary or assets, and (ii) any acquired or newly formed subsidiary
shall not be liable for any Indebtedness (except for Indebtedness permitted by
6.01).
"Permitted Encumbrances" means:
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.05;
(b) carriers', warehousemen' s, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more
than 30 days or are being contested in compliance with Section 5.05;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds
and other obliga-
27
tions of a like nature, in each case in the ordinary course of business;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (k) of Article VII; and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere
with the ordinary conduct of business of Holdings, the Borrower or any
Subsidiary;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States of America), in
each case maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from
the date of acquisition thereof and having, at such date of acquisition,
the highest credit rating obtainable from S&P or from ▇▇▇▇▇'▇;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within 180 days from the date of acquisition
thereof issued or guaranteed by or placed with, and money market deposit
accounts issued or offered by, any domestic office of any commercial bank
organized under the laws of the United States of America or any State
thereof that has a combined capital and surplus and undivided profits of
not less than $250,000,000 or a foreign bank that has a combined capital
and surplus and undivided profits of not less than $125,000,000; and
(d) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) above and entered
into with a financial institution satisfying the criteria described in
clause (c) above.
28
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is an "employer" as defined in Section 3(5) of ERISA.
"Pledge Agreement" means the Pledge Agreement, substantially in the
form of Exhibit G, among Holdings, the Borrower, the other Subsidiaries party
thereto and the Collateral Agent for the benefit of the Secured Parties.
"Prepayment Event" means:
(a) any sale, transfer or other disposition (including pursuant to a
sale and leaseback transaction) of any property or asset of Holdings, the
Borrower or any Subsidiary, other than (i) dispositions described in
clauses (a), (b) and (c) of Section 6.05 and (ii) other dispositions
resulting in aggregate Net Proceeds not exceeding $5,000,000 during any
fiscal year of the Borrower; or
(b) any casualty or other insured damage to, or any taking under
power of eminent domain or by condemnation or similar proceeding of, any
property or asset of Holdings, the Borrower or any Subsidiary, but only to
the extent that the Net Proceeds therefrom have not been applied to
repair, restore or replace such property or asset within one year after
such event; or
(c) the issuance by the Borrower of Equity Interests pursuant to the
Additional Equity Contribution, or the receipt by the Borrower of any
capital contribution pursuant to the Additional Equity Contribution; or
(d) the incurrence by Holdings, the Borrower or any Subsidiary of
any Indebtedness, other than Indebtedness permitted pursuant to Section
6.01.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by The Chase Manhattan Bank as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be effec-
29
tive from and including the date such change is publicly announced as being
effective.
"PTI Acquisition" means the acquisition by ALEC Acquisition or any
other Wholly Owned Subsidiary from the Sellers of all of the outstanding capital
stock of the Alaska Entities in accordance with the PTI Purchase Agreement.
"PTI Adjustment Amount" means the amount equal to the sum, if
positive, of the Adjustment Amount plus the Additional Amount (in each case as
defined in Section 2.2(b) of the PTI Purchase Agreement).
"PTI Purchase Agreement" means the Purchase Agreement, dated as of
August 14, 1998, by and among the Borrower and the Sellers.
"PTI Purchase Price" means an aggregate cash purchase price equal to
$408,500,000 (subject to certain purchase price adjustments in accordance with
the PTI Purchase Agreement).
"PTI Term Facilities Indebtedness" means the Tranche A Term Loans,
Tranche B Term Loans and Tranche C Term Loans drawn on the closing date of the
PTI Acquisition.
"Purchase Agreements" means the PTI Purchase Agreement and the ATU
Purchase Agreement.
"Register" has the meaning set forth in Section 9.04(c).
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Release" means any release, spill, emission, leaking, dumping,
injection, pouring, deposit, disposal, discharge, dispersal, leaching or
migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.
"Required Lenders" means, at any time, Lenders having Revolving
Exposures, Term Loans and unused Commitments representing more than 50% of the
sum of the total Revolving Exposures, outstanding Term Loans and unused
Commitments at such time.
30
"Related Fund" means, with respect to any Lender that is a fund or
trust that makes, buys or invests in commercial loans, any other fund or trust
that makes, buys or invests in commercial loans and is managed by the same
investment advisor as such Lender.
"Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity
Interests in Holdings, the Borrower or any Subsidiary, or any payment (whether
in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancelation or termination of any Equity Interests in Holdings, the Borrower or
any Subsidiary or any option, warrant or other right to acquire any such Equity
Interests in Holdings, the Borrower or any Subsidiary.
"Revolving Availability Period" means the period from and including
the Start Date to but excluding the earlier of the Revolving Maturity Date and
the date of termination of the Revolving Commitments.
"Revolving Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, expressed as
an amount representing the maximum aggregate amount of such Lender's Revolving
Exposure hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 9.04. The initial amount
of each Lender's Revolving Commitment is set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Revolving Commitment, as applicable. The initial aggregate amount of the
Lenders' Revolving Commitments is $75,000,000.
"Revolving Exposure" means, with respect to any Lender at any time,
the sum of the outstanding principal amount of such Lender's Revolving Loans and
its LC Exposure and Swingline Exposure at such time.
"Revolving Lender" means a Lender with a Revolving Commitment or, if
the Revolving Commitments have terminated or expired, a Lender with Revolving
Exposure.
"Revolving Loan" means a Loan made pursuant to clause (a) (iv) or
(b) (vii) of Section 2.01.
31
"Revolving Maturity Date" means the date that is seven years after
the Start Date or the first Business Day thereafter, if such date is not a
Business Day.
"S&P" means Standard & Poor's Ratings Service.
"Second Acquisition" means, if the Acquisitions are consummated on
different dates, the second of the Acquisitions to be consummated and the
Transactions related thereto.
"Second Acquisition Indebtedness" means whichever of the PTI Term
Facilities Indebtedness and the ATU Term Facilities Indebtedness is incurred
second.
"Second Acquisition Loan Parties" means Holdings, the Borrower and
the Second Acquisition Subsidiary Loan Parties.
"Second Acquisition Mortgaged Property" means any Mortgaged Property
owned by a Second Acquisition Loan Party and acquired, directly or indirectly,
in connection with the Second Acquisition.
"Second Acquisition Subsidiary Loan Parties" means each Subsidiary
acquired, directly or indirectly, by the Borrower in connection with the Second
Acquisition that is not a Foreign Subsidiary.
"Second Closing Date" means, if the Acquisitions are consummated on
different dates, the date on which (a) the conditions specified in Section 4.03
are satisfied (or waived in accordance with Section 9.02) and (b) the second
drawing of the Term Facilities and the consummation of the Second Acquisition
occur.
"Secured Parties" shall have the meaning given such term in the
Security Agreement.
"Security Agreement" means the Security Agreement, substantially in
the form of Exhibit H, among the Borrower, Holdings, the Subsidiary Loan Parties
and the Collateral Agent for the benefit of the Secured Parties.
"Security Documents" means the Security Agreement, the Guarantee
Agreements, the Pledge Agreement, the Indemnity, Subrogation and Contribution
Agreement, the Mortgages and each other security agreement or other instrument
or document executed and delivered pursuant to Section 5.12 or 5.13 to secure
any of the Obligations.
32
"Sellers" means CNI and CWI.
"Senior Subordinated Notes" means the $150,000,000 in aggregate
principal amount of senior subordinated notes issued by the Borrower pursuant to
the Subordinated Debt Documents.
"Sold Entity or Business" has the meaning assigned to such term in
the definition of the term Adjusted Consolidated EBITDA.
"Sponsor" means Fox ▇▇▇▇▇ Capital Fund L.P. and its Affiliates
(other than Affiliates that are operating companies or controlled by operating
companies).
"Sponsor Equity Contribution" means a contribution of an aggregate
amount of not less than $120,000,000 (less the aggregate amount of the
Management Equity Contribution and the Investor Equity Contribution) in cash to
Holdings as common equity.
"Start Date" means the first to occur of the Initial Closing Date
and the Closing Date.
"Statutory Reserve Rate" means a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject (a) with
respect to the Base CD Rate, for new negotiable nonpersonal time deposits in
dollars of over $100,000 with maturities approximately equal to three months and
(b) with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently
referred to as "Eurocurrency Liabilities" in Regulation D of the Board). Such
reserve percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
"Subordinated Debt Documents" means the indenture or other agreement
under which the Senior Subordinated Notes are issued and all other instruments,
agreements and other documents evidencing or governing the Senior Subordinated
33
Notes or providing for any Guarantee or other right in respect thereof.
"Subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity of which securities or other ownership interests representing more than
50% of the equity or more than 50% of the ordinary voting power or, in the case
of a partnership, more than 50% of the general partnership interests are, as of
such date, owned, controlled or held, by the parent or one or more subsidiaries
of the parent or by the parent and one or more subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower. For purposes of
the representations and warranties made herein on (and the conditions to
borrowing on) the Closing Date, the Initial Closing Date or the Second Closing
Date, as applicable, the term "Subsidiary" includes, if the ATU Acquisition is
to occur on such date, each of (a) ATU Communications, Inc., MACtel, Inc., ATU
Long Distance, Inc. and Peninsula Cellular Services, Inc. and (b) the entity or
entities containing the assets of ATU Telecommunications and, if the PTI
Acquisition is to occur on such date, each of the Alaska Entities and their
respective subsidiaries.
"Subsidiary Guarantee Agreement" means the Subsidiary Guarantee
Agreement, substantially in the form of Exhibit E, made by the Subsidiary Loan
Parties in favor of the Administrative Agent for the benefit of the Secured
Parties.
"Subsidiary Loan Party" means any Subsidiary that is not a Foreign
Subsidiary.
"Swingline Exposure" means, at any time, the aggregate principal
amount of all Swingline Loans outstanding at such time. The Swingline Exposure
of any Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.
"Swingline Lender" means The Chase Manhattan Bank, in its capacity
as lender of Swingline Loans hereunder.
"Swingline Loan" means a Loan made pursuant to Section 2.04.
34
"Syndication Agent" means the Canadian Imperial Bank of Commerce, in
its capacity as syndication agent for the Lenders hereunder.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Loan Commitments" means Tranche A Commitments, Tranche B
Commitments and Tranche C Commitments.
"Term Loans" means Tranche A Term Loans, Tranche B Term Loans and
Tranche C Term Loans.
"Test Period" means, for any determination made on a specific date,
the period of four consecutive fiscal quarters of the Borrower most recently
ended as of such date (taken as one accounting period).
"Three-Month Secondary CD Rate" means, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day is not a Business Day, the next preceding Business
Day) by the Board through the public information telephone line of the Federal
Reserve Bank of New York (which rate will, under the current practices of the
Board, be published in Federal Reserve Statistical Release H.15 (519) during the
week following such day) or, if such rate is not so reported on such day or such
next preceding Business Day, the average of the secondary market quotations for
three-month certificates of deposit of major money center banks in New York City
received at approximately 10:00 a.m., New York City time, on such day (or, if
such day is not a Business Day, on the next preceding Business Day) by the
Administrative Agent from three negotiable certificate of deposit dealers of
recognized standing selected by it.
"Total Debt" means, with respect to Holdings, the Borrower and the
Subsidiaries on a consolidated basis at any time (without duplication), all
Indebtedness consisting of Capital Lease Obligations, Indebtedness for borrowed
money and Indebtedness in respect of the deferred purchase price of property or
services of Holdings, the Borrower and the Subsidiaries on a consolidated basis
at such time.
"Tranche A Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make Tranche A Term Loans hereunder on the
Start Date and Second Closing Date, if any, expressed as an amount representing
the maximum aggregate principal amount of the Tranche A Term Loans to be made by
such Lender hereunder, as such commit-
35
ment may be (a) reduced from time to time pursuant to Section 2.08 and (b)
reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender's Tranche A
Commitment is set forth on Schedule 2.01, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Tranche A Commitment, as
applicable. The initial aggregate amount of the Lenders' Tranche A Commitments
is $150,000,000.
"Tranche A Lender" means a Lender with a Tranche A Commitment or an
outstanding Tranche A Term Loan.
"Tranche A Maturity Date" means the date that is seven and one-half
years after the Start Date or the first Business Day thereafter, if such date is
not a Business Day.
"Tranche A Term Loan" means a Loan made pursuant to clause (a) (i),
(b) (i) or (b) (ii) of Section 2.01.
"Tranche B Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make Tranche B Term Loans hereunder on the
Start Date and Second Closing Date, if any, expressed as an amount representing
the maximum aggregate principal amount of the Tranche B Term Loans to be made by
such Lender hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 9.04. The initial amount
of each Lender's Tranche B Commitment is set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Tranche B Commitment, as applicable. The initial aggregate amount of the
Lenders' Tranche B Commitments is $150,000,000.
"Tranche B Lender" means a Lender with a Tranche B Commitment or an
outstanding Tranche B Term Loan.
"Tranche B Maturity Date" means the date that is eight and one-half
years after the Start Date or the first Business Day thereafter, if such date is
not a Business Day.
"Tranche B Rate" means, with respect to any Tranche B Term Loan, (a)
2.00% per annum, in the case of an ABR Loan, or (b) 3.00% per annum, in the case
of a Eurodollar Loan.
"Tranche B Term Loan" means a Loan made pursuant to clause (a) (ii),
(b) (iii) or (b) (iv) of Section 2.01.
36
"Tranche C Term Loan" means a Loan made pursuant to clause (a)
(iii), (b) (v) or (b) (vi) of Section 2.01.
"Tranche C Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make Tranche C Term Loans hereunder on the
Start Date and Second Closing Date, if any, expressed as an amount representing
the maximum aggregate principal amount of the Tranche C Term Loans to be made by
such Lender hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 9.04. The initial amount
of each Lender's Tranche C Commitment is set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Tranche C Commitment, as applicable. The initial aggregate amount of the
Lenders' Tranche C Commitments is $135,000,000.
"Tranche C Lender" means a Lender with a Tranche C Commitment or an
outstanding Tranche C Term Loan.
"Tranche C Maturity Date" means the date that is nine years after
the Start Date or the first Business Day thereafter, if such date is not a
Business Day.
"Tranche C Rate" means, with respect to any Tranche C Term Loan, (a)
2.25% per annum, in the case of an ABR Loan, or (b) 3.25% per annum, in the case
of a Eurodollar Loan.
"Transaction Costs" means the fees and expenses incurred by
Holdings, the Borrower or any Subsidiary in connection with the Transactions.
"Transactions" means, collectively, the transactions described in
the preamble of this Agreement, including but not limited to the Acquisitions
and the borrowings under this Credit Agreement.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"Wholly Owned Subsidiary" means a Subsidiary all the Equity Interest
of which (other than directors' qualifying shares) is owned by the Borrower or
another Wholly Owned Subsidiary.
37
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes
of this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., a "Eurodollar Revolving Loan"). Borrowings also may be classified and
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
Borrowing").
SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time, provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the
38
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
The Credits
SECTION 2.01. Commitments. Subject to the terms and conditions set
forth herein, each Lender agrees:
(a) if the Acquisitions are consummated simultaneously, (i) to make
a Tranche A Term Loan to the Borrower on the Start Date in a principal
amount not exceeding its Tranche A Commitment, (ii) to make a Tranche B
Term Loan to the Borrower on the Start Date in a principal amount not
exceeding its Tranche B Commitment, (iii) to make a Tranche C Term Loan to
the Borrower on the Start Date in a principal amount not exceeding its
Tranche C Commitment and (iv) to make Revolving Loans to the Borrower on
the Start Date and from time to time during the Revolving Availability
Period in an aggregate principal amount that will not result in such
Lender's Revolving Exposure exceeding such Lender's Revolving Commitment;
(b) if the Acquisitions are consummated on different dates, (i) to
make a Tranche A Term Loan to the Borrower on the Start Date in a
principal amount not to exceed the lesser of its Tranche A Commitment and
its pro rata share (based on the Tranche A Commitments of all the Lenders)
of (A) $90,000,000, if the PTI Acquisition is the First Acquisition, or
(B) $60,000,000 (subject to reduction as provided in Section 2.10(g)
(iii), if the ATU Acquisition is the First Acquisition, (ii) to make a
Tranche A Term Loan to the Borrower on the Second Closing Date, if any, in
a principal amount not to exceed its remaining unused Tranche A
Commitment, (iii) to make a Tranche B Term Loan to the Borrower on the
Start Date in a principal amount not to exceed the lesser of its Tranche B
Commitment and its pro rata share (based on the Tranche B Commitments of
all the Lenders) of (A) $85,000,000, if the PTI Acquisition is the First
39
Acquisition, or (B) $65,000,000 (subject to reduction as provided in
Section 2.10(g) (iii)), if the ATU Acquisition is the First Acquisition,
(iv) to make a Tranche B Term Loan to the Borrower on the Second Closing
Date, if any, in a principal amount not to exceed its remaining unused
Tranche B Commitment, (v) to make a Tranche C Term Loan to the Borrower on
the Start Date in a principal amount not to exceed the lesser of its
Tranche C Commitment and its pro rata share (based on the Tranche C
Commitments of all the Lenders) of (A) $90,000,000, if the PTI Acquisition
is the First Acquisition, or (B) $70,000,000 (subject to reduction as
provided in Section 2.10(g) (iii)), if the ATU Acquisition is the First
Acquisition, (vi) to make a Tranche C Term Loan to the Borrower on the
Second Closing Date, if any, in a principal amount not to exceed its
remaining unused Tranche C Commitment and (vii) to make Revolving Loans to
the Borrower on the Start Date and the Second Closing Date and from time
to time during the Revolving Availability Period in an aggregate principal
amount that will not result in such Lender's Revolving Exposure exceeding
(x) the lesser of such Lender's Revolving Commitment and such Lender's
Applicable Percentage of $50,000,000, at any time prior to the Second
Closing Date (if any), and (B) such Lender's Revolving Commitment, at any
time on or after the Second Closing Date (if any).
Within the foregoing limits and subject to the terms and conditions
set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.
Amounts repaid in respect of Term Loans may not be reborrowed.
SECTION 2.02. Loans and Borrowings. (a) Each Loan (other than a
Swingline Loan) shall be made as part of a Borrowing consisting of Loans of the
same Class and Type made by the Lenders ratably in accordance with their
respective Commitments of the applicable Class. The failure of any Lender to
make any Loan required to be made by it shall not relieve any other Lender of
its obligations hereunder, provided that the Commitments of the Lenders are
several and no Lender shall be responsible for any other Lender's failure to
make Loans as required.
(b) Subject to Section 2.14, each Revolving Borrowing and Term
Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the
Borrower may request in accordance herewith, provided that all Borrowings made
on the Start Date must be made as ABR Borrowings. Each Swingline Loan shall be
an ABR Loan. Each Lender at its option may make any Eurodollar Loan by causing
any domestic or
40
foreign branch or Affiliate of such Lender to make such Loan, provided that any
exercise of such option shall not affect the obligation of the Borrower to repay
such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $5,000,000. At the time that each ABR
Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that
is an integral multiple of $1,000,000 and not less than $5,000,000, provided
that an ABR Revolving Borrowing may be in an aggregate amount that is equal to
the entire unused balance of the total Revolving Commitments or that is required
to finance the reimbursement of an LC Disbursement as contemplated by Section
2.05(e). Each Swingline Loan shall be in an amount that is an integral multiple
of $500,000 and not less than $500,000. Borrowings of more than one Type and
Class may be outstanding at the same time, provided that there shall not at any
time be more than a total of fifteen Eurodollar Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Revolving Maturity Date, the Tranche A Maturity Date, the Tranche B
Maturity Date or the Tranche C Maturity Date, as applicable.
SECTION 2.03. Requests for Borrowings. To request a Revolving
Borrowing or Term Borrowing, the Borrower shall notify the Administrative Agent
of such request by telephone (a) in the case of a Eurodollar Borrowing, not
later than 11:00 a.m., New York City time, three Business Days before the date
of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than
11:00 a.m., New York City time, one Business Day before the date of the proposed
Borrowing, provided that any such notice of an ABR Revolving Borrowing to
finance the reimbursement of an LC Disbursement as contemplated by Section
2.05(e) may be given not later than 10:00 a.m., New York City time, on the date
of the proposed Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Borrowing Request in a form approved by the
Administrative Agent and signed by
41
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.02:
(i) whether the requested Borrowing is to be a Revolving Borrowing,
Tranche A Term Borrowing, Tranche B Term Borrowing or Tranche C Term
Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) the date of such Borrowing, which shall be a Business Day;
(iv) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(v) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period"; and
(vi) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.06.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Revolving Borrowing, then the Borrower shall
be deemed to have selected an Interest Period of one month's duration. Promptly
following receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. Swingline Loans. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrower from time to time during the Revolving Availability Period, in
an aggregate principal amount at any time outstanding that will not result in
(i) the aggregate principal amount of outstanding Swingline Loans exceeding
$10,000,000 or (ii) the sum of the total Revolving Exposures exceeding (A) if
the Acquisitions are consummated simultaneously, the total Revolving Commitments
and (B) if the Acquisitions are consummated on different dates, (x) the lesser
of the total Revolving Commitments and $50,000,000, at any time prior to the
Second Closing Date (if any), and (y) the total Revolving Commitments, at any
time on or after the Second Closing Date (if any). Within the foregoing limits
and
42
subject to the terms and conditions set forth herein, the Borrower may borrow,
prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by telecopy), not
later than 12:00 noon, New York City time, on the day of a proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day) and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Borrower. The Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a credit to the general
deposit account of the Borrower with the Swingline Lender (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as
provided in Section 2.05(e), by remittance to the Issuing Bank) by 3:00 p.m.,
New York City time, on the requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 12:00 noon, New York City time, on any
Business Day require the Revolving Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans outstanding. Such notice
shall specify the aggregate amount of Swingline Loans in which Revolving Lenders
will participate. Promptly upon receipt of such notice, the Administrative Agent
will give notice thereof to each Revolving Lender, specifying in such notice
such Lender's Applicable Percentage of such Swingline Loan or Swingline Loans.
Each Revolving Lender hereby absolutely and unconditionally agrees, upon receipt
of notice as provided above, to pay to the Administrative Agent, for the account
of the Swingline Lender, such Lender's Applicable Percentage of such Swingline
Loan or Swingline Loans. Each Revolving Lender acknowledges and agrees that its
obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever. Each
Revolving Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of the Revolving Lenders),
and the Administrative Agent shall promptly pay to the Swingline Lender the
amounts so received by it from the Revolving Lenders. The Administrative Agent
43
shall notify the Borrower of any participations in any Swingline Loan acquired
pursuant to this paragraph, and thereafter payments in respect of such Swingline
Loan shall be made to the Administrative Agent and not to the Swingline Lender.
Any amounts received by the Swingline Lender from the Borrower (or other party
on behalf of the Borrower) in respect of a Swingline Loan after receipt by the
Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent; any such amounts received by the
Administrative Agent shall be promptly remitted by the Administrative Agent to
the Revolving Lenders that shall have made their payments pursuant to this
paragraph and to the Swingline Lender, as their interests may appear. The
purchase of participations in a Swingline Loan pursuant to this paragraph shall
not relieve the Borrower of any default in the payment thereof.
SECTION 2.05. Letters of Credit. (a) General. Subject to the terms
and conditions set forth herein, the Borrower may request the issuance of
Letters of Credit for its own account, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Revolving Availability Period. In the event of any inconsistency
between the terms and conditions of this Agreement and the terms and conditions
of any form of letter of credit application or other agreement submitted by the
Borrower to, or entered into by the Borrower with, the Issuing Bank relating to
any Letter of Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (reasonably in advance of the requested date
of issuance, amendment, renewal or extension) a notice requesting the issuance
of a Letter of Credit, or identifying the Letter of Credit to be amended,
renewed or extended, and specifying the date of issuance, amendment, renewal or
extension (which shall be a Business Day), the date on which such Letter of
Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. If requested by the Issuing Bank, the Borrower
also shall submit a letter of credit application on the Issuing Bank's standard
form in
44
connection with any request for a Letter of Credit. A Letter of Credit shall be
issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit the Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the LC Exposure shall not exceed $25,000,000 and (ii)
the total Revolving Exposures shall not exceed (A) if the Acquisitions are
consummated simultaneously, the total Revolving Commitments and (B) if the
Acquisitions are consummated on different dates, (A) the lesser of the total
Revolving Commitments and $50,000,000, at any time prior to the Second Closing
Date (if any), and (B) the total Revolving Commitments, at any time on or after
the Second Closing Date (if any).
(c) Expiration Date. Each Letter of Credit shall expire at or prior
to the close of business on the earlier of (i) the date one year after the date
of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Revolving Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit equal
to such Lender's Applicable Percentage of the aggregate amount available to be
drawn under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to
pay to the Administrative Agent, for the account of the Issuing Bank, such
Lender's Applicable Percentage of each LC Disbursement made by the Issuing Bank
and not reimbursed by the Borrower on the date due as provided in paragraph (e)
of this Section, or of any reimbursement payment required to be refunded to the
Borrower for any reason. Each Lender acknowledges and agrees that its obligation
to acquire participations pursuant to this paragraph in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
45
(e) Reimbursement. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 3:00 p.m., New York City time, on the date that such
LC Disbursement is made, if the Borrower shall have received notice of such LC
Disbursement prior to 10:00 a.m., New York City time, on such date, or, if such
notice has not been received by the Borrower prior to such time on such date,
then not later than 3:00 p.m., New York City time, on (i) the Business Day that
the Borrower receives such notice, if such notice is received prior to 10:00
a.m., New York City time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is not received prior to 10:00 a.m., New York City time on the day of
receipt, provided that, if such LC Disbursement is not less than $5,000,000, the
Borrower may, subject to the conditions to borrowing set forth herein, request
in accordance with Section 2.03 or 2.04 that such payment be financed with an
ABR Revolving Borrowing or Swingline Loan in an equivalent amount and, to the
extent so financed, the Borrower's obligation to make such payment shall be
discharged and replaced by the resulting ABR Revolving Borrowing or Swingline
Loan. If the Borrower fails to make such payment when due, the Administrative
Agent shall notify each Revolving Lender of the applicable LC Disbursement, the
payment then due from the Borrower in respect thereof and such Lender's
Applicable Percentage thereof. Promptly following receipt of such notice, each
Revolving Lender shall pay to the Administrative Agent its Applicable Percentage
of the payment then due from the Borrower, in the same manner as provided in
Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of the Revolving Lenders),
and the Administrative Agent shall promptly pay to the Issuing Bank the amounts
so received by it from the Revolving Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Revolving Lenders have made payments pursuant to
this paragraph to reimburse the Issuing Bank, then to such Lenders and the
Issuing Bank as their interests may appear. Any payment made by a Revolving
Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC
Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan
as contemplated above) shall not constitute a Loan and shall not relieve the
Borrower of its obligation to reimburse such LC Disbursement (other than with
respect to
46
the timing of such reimbursement obligation as set forth in Section 2.05(e)).
(f) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. Neither
the Administrative Agent, the Lenders nor the Issuing Bank, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank, provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by the Issuing Bank's failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or wilful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented that appear on their
face to be in substantial
47
compliance with the terms of a Letter of Credit, the Issuing Bank may, in its
sole discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder, provided that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse the Issuing Bank and the Revolving Lenders with respect to any such LC
Disbursement (other than with respect to the timing of such reimbursement
obligation as set forth in Section 2.05(e)).
(h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans,
provided that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (e) of this Section, then Section 2.13(c) shall apply.
Interest accrued pursuant to this paragraph shall be for the account of the
Issuing Bank, except that interest accrued on and after the date of payment by
any Revolving Lender pursuant to paragraph (e) of this Section to reimburse the
Issuing Bank shall be for the account of such Lender to the extent of such
payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be
replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced Issuing Bank and the successor Issuing Bank. The
Administrative Agent shall notify the Lenders of any such replacement of the
Issuing Bank. At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.12(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of the Issuing Bank under this Agreement with respect to Letters
of Credit
48
to be issued thereafter and (ii) references herein to the term "Issuing Bank"
shall be deemed to refer to such successor or to any previous Issuing Bank, or
to such successor and all previous Issuing Banks, as the context shall require.
After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank
shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and
be continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Revolving Lenders with LC Exposure representing greater
than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as of such
date plus any accrued and unpaid interest thereon, provided that the obligation
to deposit such cash collateral shall become effective immediately, and such
deposit shall become immediately due and payable, without demand or other notice
of any kind, upon the occurrence of any Event of Default with respect to the
Borrower described in clause (h) or (i) of Article VII. Each such deposit shall
be held by the Administrative Agent as collateral for the payment and
performance of the obligations of the Borrower under this Agreement. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Other than any interest earned
on the investment of such deposits, which investments shall be Permitted
Investments, made at the option and sole discretion of the Administrative Agent
and at the Borrower's risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account and shall be the Borrower's property held by the Collateral Agent as
collateral for the payment and performance of the Obligations in accordance with
the Security Agreement. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated (but subject to the consent of Revolving Lenders with LC Exposure
49
representing greater than 50% of the total LC Exposure), be applied to satisfy
other obligations of the Borrower under this Agreement. If the Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount plus any accrued interest or
realized profits on account of such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived. If the Borrower is required to
provide an amount of cash collateral hereunder pursuant to Section 2.11(b), such
amount plus any accrued interest or realized profits on account of such amount
(to the extent not applied as aforesaid) shall be returned to the Borrower as
and to the extent that, after giving effect to such return, the Borrower would
remain in compliance with Section 2.11(b) and no Default shall have occurred and
be continuing.
SECTION 2.06. Funding of Borrowings. (a) Each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders, provided that Swingline Loans shall be made as provided
in Section 2.04. The Administrative Agent will make such Loans available to the
Borrower by promptly crediting the amounts so received, in like funds, to an
account of the Borrower maintained with the Administrative Agent in New York
City and designated by the Borrower in the applicable Borrowing Request,
provided that ABR Revolving Loans made to finance the reimbursement of an LC
Disbursement as provided in Section 2.05(e) shall be remitted by the
Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from
a Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the
50
Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank compensation or
(ii) in the case of the Borrower, the interest rate applicable to ABR Loans.
If such Lender pays such amount to the Administrative Agent, then such amount
shall constitute such Lender's Loan included in such Borrowing.
SECTION 2.07. Interest Elections. (a) Each Revolving Borrowing
and Term Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an
initial Interest Period as specified in such Borrowing Request. Thereafter,
the Borrower may elect to convert such Borrowing to a different Type or to
continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The Borrower may
elect different options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated ratably among
the Lenders holding the Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing. This
Section shall not apply to Swingline Borrowings, which may not be converted
or continued.
(b) To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the
time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Revolving Borrowing of the Type resulting from
such election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be
confirmed promptly by hand delivery or telecopy to the Administrative Agent
of a written Interest Election Request in a form approved by the
Administrative Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02 and
paragraph (f) of this Section:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each
resulting Borrowing (in which case the information to be specified
purusant to clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);
51
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies the Borrower, then, so long as an
Event of Default is continuing (i) no outstanding Borrowing may be converted to
or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.
(f) A Borrowing of any Class may not be converted to or continued as
a Eurodollar Borrowing if after giving effect thereto (i) the Interest Period
therefor would commence before and end after a date on which any principal of
the Loans of such Class is scheduled to be repaid and (ii) the sum of the
aggregate principal amount of outstanding Eurodollar Borrowings of such Class
with Interest Periods ending on or prior to such scheduled repayment date plus
the aggregate principal amount of outstanding ABR Borrowings of such Class would
be less than the aggregate principal amount of Loans of such Class required to
be repaid on such scheduled repayment date.
52
SECTION 2.08. Termination and Reduction of Commitments. (a) Unless
previously terminated, (i) the Tranche A Commitments, Tranche B Commitments and
Tranche C Commitments shall terminate at 5:00 p.m., New York City time, (A) if
the Acquisitions are consummated simultaneously, on the Closing Date or (B) if
the Acquisitions are consummated on different dates, on the earlier of the
Second Closing Date and December 31, 1999, and (ii) the Revolving Commitments
shall (A) terminate on the Revolving Maturity Date and (B) if the Acquisitions
are consummated on different dates, be permanently reduced by $25,000,000 at
5:00 p.m., New York City time, on December 31, 1999, if the Second Acquisition
has not been consummated at or before such time.
(b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments of any Class, provided that (i) each reduction of the
Commitments of any Class shall be in an amount that is an integral multiple of
$1,000,000 and not less than $5,000,000 and (ii) the Borrower shall not
terminate or reduce the Revolving Commitments if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.11,
the sum of the Revolving Exposures would exceed the total Revolving Commitments.
(c) The Tranche A Commitments, Tranche B Commitments and Tranche C
Commitments shall be automatically and permanently reduced by any amounts
required to be applied for such purpose under paragraph (c) or (d) of Section
2.11 prior to the earlier of the Second Closing Date and December 31, 1999.
(d) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) or (d) of
this Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable, provided that a notice
of termination of the Revolving Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Commitments of
any Class shall be permanent. Each reduction of the Commitments of any Class
shall be made ratably among the
53
Lenders in accordance with their respective Commitments of such Class.
SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay (i) to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Revolving Loan
of such Lender on the Revolving Maturity Date, (ii) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each Term
Loan of such Lender as provided in Section 2.10 and (iii) to the Swingline
Lender the then unpaid principal amount of each Swingline Loan on the earlier
of the Revolving Maturity Date and the first date after such Swingline Loan is
made that is the 15th or last day of a calendar month and is at least two
Business Days after such Swingline Loan is made, provided that on each date that
a Revolving Borrowing is made, the Borrower shall repay all Swingline Loans then
outstanding.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Class and Type
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein, provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans of any Class made by it be
evidenced by a promissory note. In such event, the Borrower shall prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Admin-
54
istrative Agent. Thereafter, the Loans evidenced by such promissory note and
interest thereon shall at all times (including after assignment pursuant to
Section 9.04) be represented by one or more promissory notes in such form
payable to the order of the payee named therein (or, if such promissory note is
a registered note, to such payee and its registered assigns).
SECTION 2.10. Amortization of Term Loans. (a) Subject to adjustment
pursuant to paragraph (e) of this Section, the Borrower shall repay Tranche A
Term Borrowings on each date set forth below in the amounts equal to the
percentages of the aggregate principal amount of the Tranche A Term Borrowings
outstanding on the earlier of Closing Date, Second Closing Date (after giving
effect to all Tranche A Term Borrowings on the Second Closing Date) and December
31, 1999, set forth opposite such date:
Number of Years After Annual Repayment
the Start Date Percentage
-------------- ----------
3 1%
4 1%
5 1%
6 1%
7 1%
(b) Subject to adjustment pursuant to paragraph (e) of this Section,
the Borrower shall repay Tranche B Term Borrowings on each date set forth below
in the amounts equal to the percentages of the aggregate principal amount of the
Tranche B Term Borrowings outstanding on the earlier of the Closing Date, the
Second Closing Date (after giving effect to all Tranche B Term Borrowings on the
Second Closing Date) and December 31, 1999, set forth opposite such date:
Number of Years After Annual Repayment
the Start Date Percentage
-------------- ----------
3 1%
4 1%
5 1%
6 1%
7 1%
8 1%
(c) Subject to adjustment pursuant to paragraph (e) of this Section,
the Borrower shall repay Tranche C Term Borrowings on each date set forth below
in
55
the amounts equal to the percentages of the aggregate principal amount of the
Tranche C Term Borrowings outstanding on the earlier of Closing Date, Second
Closing Date (after giving effect to all Tranche C Term Borrowings on the Second
Closing Date) and December 31, 1999 set forth opposite such date:
Number of Years After Annual Repayment
the Start Date Percentage
-------------- ----------
3 1%
4 1%
5 1%
6 1%
7 1%
8 1%
(d) To the extent not previously paid, (i) all Tranche A Term Loans
shall be due and payable on the Tranche A Maturity Date, (ii) all Tranche B Term
Loans shall be due and payable on the Tranche B Maturity Date and (iii) all
Tranche C Term Loans shall be due and payable on the Tranche C Maturity Date.
(e) Any prepayment of a Term Loan of any Class, and any reduction of
a Term Loan Commitment of any Class, shall be applied to reduce the subsequent
scheduled repayments of the Term Loans of such Class to be made pursuant to this
Section ratably.
(f) Except as set forth in paragraphs (g) and (i) below, (i) all Net
Proceeds (other than pursuant to the Additional Equity Contribution) and Excess
Cash Flow to be applied at any time to prepay Term Borrowings and, if
applicable, to reduce Tranche A Commitments, Tranche B Commitments or Tranche C
Commitments pursuant to Sections 2.11 and 2.08(c), respectively, shall be
applied as follows: (A) a portion of such Net Proceeds and/or Excess Cash Flow
equal to (l) the amount of such Net Proceeds and/or Excess Cash Flow multiplied
by (2) a fraction, the numerator of which is the sum of the outstanding
principal amount of Tranche A Term Borrowings at such time and the aggregate
unused Tranche A Commitments at such time and the denominator of which is the
sum of the outstanding principal amount of all Term Borrowings at such time and
the aggregate unused Term Loan Commitments at such time, shall be applied,
first, to prepay Tranche A Term Borrowings and, after all outstanding Tranche A
Term Borrowings have been prepaid, to reduce Tranche A Commitments with the
Borrower retaining such proceeds; (B) a portion of such Net Proceeds and/or
56
Excess Cash Flow equal to (l) the amount of such Net Proceeds and/or Excess Cash
Flow multiplied by (2) a fraction, the numerator of which is the sum of the
outstanding principal amount of Tranche B Term Borrowings at such time and the
aggregate unused Tranche B Commitments at such time and the denominator of which
is the sum of the outstanding principal amount of all Term Borrowings at such
time and the aggregate unused Term Loan Commitments at such time, shall be
applied, first, to prepay Tranche B Term Borrowings and, after all outstanding
Tranche B Term Borrowings have been prepaid, to reduce Tranche B Commitments
(with the Borrower retaining the proceeds); and (C) a portion of such Net
Proceeds and/or Excess Cash Flow equal to (1) the amount of such Net Proceeds
and/or Excess Cash Flow multiplied by (2) a fraction, the numerator of which is
the sum of the outstanding principal amount of Tranche C Term Borrowings at such
time and the aggregate unused Tranche C Commitments at such time and the
denominator of which is the sum of the outstanding principal amount of all Term
Borrowings at such time and the aggregate unused Term Loan Commitments at such
time, shall be applied, first, to prepay Tranche C Term Borrowings and, after
all outstanding Tranche C Term Borrowings have been prepaid, to reduce Tranche C
Commitments (with the Borrower retaining the proceeds); and
(ii) The Net Proceeds of any Additional Equity Contribution to be
applied pursuant to Section 2.11 shall be applied, (A) first, to reduce up to
$7,700,000 of outstanding Revolving Loans (without reduction of the Revolving
Commitments), (B) second, to reduce outstanding Revolving Loans (without
reduction of the Revolving Commitments) to the extent such borrowings are
attributable to the increase, if any, in the Net Plant Amount, (C) third, to
reduce outstanding Tranche C Term Loans and, after all outstanding Tranche C
Term Loans have been prepaid, the aggregate unused Tranche C Commitments (with
the Borrower retaining the proceeds) and (D) fourth, to the extent of any
remaining Net Proceeds, to reduce Tranche A Term Loans and Tranche B Term Loans,
respectively, as follows: (l) a portion of such remaining Net Proceeds equal to
(x) the amount of such Net Proceeds multiplied by (y) a fraction, the numerator
of which is the sum of the outstanding principal amount of Tranche A Term Loans
at such time and the aggregate unused Tranche A Commitments at such time and the
denominator of which is the sum of the outstanding principal amount of Tranche A
Term Loans and Tranche B Term Loans and the aggregate unused Tranche A
Commitments and Tranche B Commitments at such time, shall be applied to prepay
Tranche A Term Loans and, after all outstanding Tranche A Term Loans have been
prepaid, to reduce Tranche A
57
Commitments (with the Borrower retaining the proceeds) and (2) a portion of such
remaining Net Proceeds equal to (x) the amount of such Net Proceeds multiplied
by (y) a fraction, the numerator of which is the sum of the outstanding
principal amount of Tranche B Term Loans and the aggregate unused Tranche B
Commitments at such time and the denominator of which is the sum of the
outstanding principal amount of Tranche A Term Loans and Tranche B Term Loans
and the aggregate unused Tranche A Commitments at such time, shall be applied to
prepay Tranche B Term Loans and, after all outstanding Tranche B Term Loans have
been prepaid, to reduce Tranche B Commitments (with the Borrower retaining the
proceeds).
Each payment of Borrowings pursuant to this Section 2.10 shall be
accompanied by accrued interest on the principal amount paid to but excluding
the date of payment.
(g) Notwithstanding the provisions of paragraph (f) above, (i) if
any Net Proceeds result from the occurrence of the RSA #1 Sale after the Start
Date, then such Net Proceeds shall be used (A) first, to repay outstanding
Revolving Borrowings (without any reduction of the Revolving Commitments) and
(B) second, to the extent of any remaining portion of such Net Proceeds, to
repay Term Borrowings (and reduce Term Loan Commitments) as provided in
paragraph (f) above; (ii) if the Acquisitions are consummated on different dates
and any Net Proceeds are received after the Initial Closing Date and prior to
the earlier of the termination of the Term Loan Commitments and the Second
Closing Date, if applicable, then (A) if the PTI Acquisition is not the First
Acquisition and such Net Proceeds arise from the issuance of Senior Subordinated
Notes, all such Net Proceeds shall be retained by the Borrower in a Collateral
Account pending the use of such Net Proceeds to finance the Second Acquisition
on the Second Closing Date (at which time, the portion of such amounts in excess
of $119,500,000 shall be used (l) first, to reduce up to $15,000,000 of
Revolving Borrowings on the Second Closing Date, (2) second, to reduce Revolving
Borrowings, if any, on the Second Closing Date to the extent such Borrowings
would be attributable to (x) the increase, if any, in the Net Plant Amount or
(y) at the option of the Borrower, up to $5,000,000 of the PTI Adjustment
Amount, (3) third, to reduce Tranche C Borrowings (and the Tranche C
Commitments) on the Second Closing Date and (4) fourth, to the extent of any
remaining Net Proceeds, to reduce Tranche A Borrowings (and the Tranche A
Commitments) and Tranche B Borrowings (and the Tranche B Commitments) on the
Second Closing Date on a pro rata basis), and (B) all other Net Proceeds
allocable to the undrawn portion of the Term Facilities may
58
be retained by the Borrower and applied to reduce the unused Term Loan
Commitments as described in paragraph (f) above; and (iii) notwithstanding
anything to the contrary in clause (ii) (A), if the Acquisitions are consummated
on different dates and the PTI Acquisition is not the First Acquisition and is
not consummated on or before the Equity Contribution Date, and (A) Senior
Subordinated Notes have been issued and the proceeds thereof are being held in a
Collateral Account or (B) Senior Subordinated Notes are issued after the Equity
Contribution Date, the Net Proceeds resulting from the issuance of such Senior
Subordinated Notes shall be applied in the following manner: (A) a percentage
(such percentage to equal the percentage of the total capitalization (excluding
cash on hand) of the Borrower represented by common equity immediately prior to
the issuance of the Senior Subordinated Notes) of the Net Proceeds resulting
from the issuance of the Senior Subordinated Notes shall be used to repurchase
common equity (the "Equity Clawback") of Holdings, except to the extent that (x)
after giving effect to such application of proceeds, common equity would
represent less than 25% of the total capitalization (excluding cash on hand) of
the Borrower determined on a pro forma basis as of the Initial Closing Date or
(y) the aggregate amount of the Sponsor Equity Contribution, the Management
Equity Contribution and the Investor Equity Contribution minus the amount of the
Equity Clawback would represent less than 17.5% of the total capitalization
(excluding cash on hand) of the Borrower determined on a pro forma basis as of
the Initial Closing Date, and (B) to the extent of any remaining portion of such
Net Proceeds, pro rata among the Term Facilities based on the then outstanding
principal amount of the term loans under each Term Facility. Notwithstanding the
foregoing, if there are undrawn commitments under the Term Facilities
immediately prior to 5:00 p.m., New York City time, on December 31, 1999, then
any Net Proceeds retained in the Collateral Account or applied to reduce the
Lenders' commitments under the Term Facilities as described above shall be
applied at such time to prepay the then-outstanding principal amount of loans
under the Term Facilities on a pro rata basis among the Term Facilities.
(h) Prior to any repayment of any Term Borrowings of any Class
hereunder, the Borrower shall select the Borrowing or Borrowings of the
applicable Class to be repaid and shall notify the Administrative Agent by
telephone (confirmed by telecopy) of such selection not later than 11:00 a.m.,
New York City time, three Business Days before the scheduled date of such
repayment. Each repayment of a Borrowing shall be applied ratably to the Loans
included in
59
the repaid Borrowing. Repayments of Term Borrowings shall be accompanied by
accrued interest on the amount repaid.
(i) Any Lender holding Tranche B Term Loans or Tranche C Term Loans
may elect on not less than one Business Day's prior written notice to the
Administrative Agent with respect to any mandatory prepayment to be made
pursuant to Section 2.11(c) or (d), not to have such prepayment applied to such
Lender's Tranche B Term Loans or Tranche C Term Loans, in which case the amount
not so applied shall be applied to prepay Tranche A Term Borrowings and, after
all outstanding Tranche A Term Borrowings have been prepaid, shall be retained
by the Borrower.
SECTION 2.11. Prepayment of Loans. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to the requirements of this Section.
(b) In the event that and on each occasion on which the sum of the
Revolving Exposures exceeds the total Revolving Commitments, the Borrower shall
prepay Revolving Borrowings or Swingline Borrowings (or, if no such Borrowings
are outstanding, deposit cash collateral in an account with the Administrative
Agent pursuant to Section 2.05(j)) in an aggregate amount equal to such excess.
(c) In the event that and on each occasion on which any Net Proceeds
are received by or on behalf of Holdings, the Borrower or any Subsidiary in
respect of any Prepayment Event, the Borrower shall, within three Business Days
after such Net Proceeds are received, prepay Term Borrowings (or Term Loan
Commitments shall be reduced if such receipt occurs on or after the Start Date
through and including the earlier of the Second Closing Date and December 31,
1999) in an aggregate amount equal to such Net Proceeds in accordance with
Sections 2.10(f), (g), (h) and (i), provided that, in the case of any event
described in clause (a) of the definition of the term Prepayment Event, if the
Borrower shall deliver to the Administrative Agent a certificate of a Financial
Officer to the effect that the Borrower and the Subsidiaries intend to apply the
Net Proceeds from such event, within 360 days after receipt of such Net
Proceeds, to acquire real property, equipment or other tangible assets to be
used in the business of the Borrower and the Subsidiaries or all of the
outstanding capital stock of an entity owning such assets, and certifying that
no Default has occurred and is continuing, then no prepayment shall be required
pursuant to this paragraph in respect of such event except to the extent of any
Net Proceeds therefrom that have not been so applied by
60
the end of such 360-day period, at which time a prepayment shall be required in
an amount equal to the Net Proceeds that have not been so applied.
(d) Following the end of each fiscal year of the Borrower,
commencing with the fiscal year ending December 31, 2000, the Borrower shall
prepay Term Borrowings (or Term Loan Commitments shall be reduced if such
receipt occurs on or after the Start Date through and including the earlier of
the Second Closing Date and December 31, 1999) in an aggregate amount equal to
the excess, if any, of (i) 50% of Excess Cash Flow for such fiscal year over
(ii) the aggregate principal amount of Term Borrowings prepaid during such
fiscal year pursuant to Section 2.11(a), in accordance with Sections 2.10(f) and
(g). Each prepayment pursuant to this paragraph shall be made on or before the
date on which financial statements are delivered pursuant to Section 5.01 with
respect to the fiscal year for which Excess Cash Flow is being calculated (and
in any event within 90 days after the end of such fiscal year).
(e) In the event that any portion of the Revolving Borrowings on the
Start Date or the Second Closing Date is attributable to the PTI Adjustment
Amount (to the extent attributable to cash or cash equivalents) and/or the Net
Cash Amount, the Borrower shall repay Revolving Borrowings in an aggregate
principal amount equal to such portion of such Revolving Borrowings within one
Business Day after the Start Date or the Second Closing Date, as applicable.
(f) If the aggregate principal amount of Revolving Borrowings
outstanding on the date that is two Business Days after the Closing Date exceeds
$35,000,000 then on such date the Borrower will repay Revolving Borrowings in an
aggregate principal amount at least equal to such excess.
(g) The Borrower shall notify the Administrative Agent (and, in the
case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of prepayment, (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City
time, one Business Day before the date of prepayment or (iii) in the case of
prepayment of a Swingline Loan, not later than 12:00 noon, New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date, the principal amount of each Borrowing or portion
thereof to be prepaid and, in the case of a mandatory
61
prepayment, a reasonably detailed calculation of the amount of such prepayment,
provided that, if a notice of optional prepayment is given in connection with a
conditional notice of termination of the Revolving Commitments as contemplated
by Section 2.08, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.08. Promptly following
receipt of any such notice (other than a notice relating solely to Swingline
Loans), the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02, except as necessary to apply fully the required amount
of a mandatory prepayment. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid Borrowing. Prepayments shall be
accompanied by accrued interest to the extent required by Section 2.13.
SECTION 2.12. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee, which
shall accrue at the Applicable Rate on the average daily unused amount of each
Commitment of such Lender during the period from and including the Start Date to
but excluding the date on which such Commitment terminates. Accrued commitment
fees shall be payable in arrears (i) in the case of commitment fees in respect
of the Revolving Commitments, on the last day of March, June, September and
December of each year and on the date on which the Revolving Commitments
terminate, commencing on the first such date to occur after the date hereof, and
(ii) in the case of commitment fees in respect of the Tranche A Commitments,
Tranche B Commitments and Tranche C Commitments, on December 31, 1999, or any
earlier date on which such Commitments terminate. All commitment fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day). For
purposes of computing commitment fees with respect to Revolving Commitments, a
Revolving Commitment of a Lender shall be deemed to be used to the extent of the
outstanding Revolving Loans and LC Exposure of such Lender (and the Swingline
Exposure of such Lender shall be disregarded for such purpose).
(b) The Borrower agrees to pay (i) to the Administrative Agent for
the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate as interest on Eurodollar Revolving Loans on the average daily amount of
such Lender's LC Exposure (excluding any portion thereof attributable to
unreimbursed LC
62
Disbursements) during the period from and including the Start Date to but
excluding the later of the date on which such Lender's Revolving Commitment
terminates and the date on which such Lender ceases to have any LC Exposure, and
(ii) to the Issuing Bank a fronting fee, which shall accrue at the rate of 0.25%
per annum on the average daily amount of the LC Exposure (excluding any portion
thereof attributable to unreimbursed LC Disbursements) during the period from
and including the Start Date to but excluding the later of the date of
termination of the Revolving Commitments and the date on which there ceases to
be any LC Exposure, as well as the Issuing Bank's standard fees with respect to
the issuance, amendment, renewal or extension of any Letter of Credit or
processing of drawings thereunder. Participation fees and fronting fees accrued
through and including the last day of March, June, September and December of
each year shall be payable on the third Business Day following such last day,
commencing on the first such date to occur after the Start Date, provided that
all such fees shall be payable on the date on which the Revolving Commitments
terminate and any such fees accruing after the date on which the Revolving
Commitments terminate shall be payable on demand. Any other fees payable to the
Issuing Bank pursuant to this paragraph shall be payable within 10 days after
demand. All participation fees and fronting fees shall be computed on the basis
of a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent, for its
own account, fees payable in the amounts and at the times separately agreed upon
between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
commitment fees and participation fees, to the Lenders entitled thereto. Fees
paid shall not be refundable under any circumstances.
SECTION 2.13. Interest. (a) The Loans comprising each ABR Borrowing
(including each Swingline Loan) shall bear interest at the Alternate Base Rate
plus the Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.
63
(c) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Revolving Loans as provided in paragraph (a) of this Section.
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan and, in the case of Revolving Loans,
upon termination of the Revolving Commitments, provided that (i) interest
accrued pursuant to paragraph (c) of this Section shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan (other than a
prepayment of an ABR Revolving Loan prior to the end of the Revolving
Availability Period), accrued interest on the principal amount repaid or prepaid
shall be payable on the date of such repayment or prepayment and (iii) in the
event of any conversion of any Eurodollar Loan prior to the end of the current
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to the Alternate Base
Rate at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate or
Adjusted LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
SECTION 2.14. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Adjusted LIBO Rate for such Interest
Period; or
64
(b) the Administrative Agent is advised by the Required Lenders that
the Adjusted LIBO Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (or Lender) of making or
maintaining their Loans (or its Loan) included in such Borrowing for such
Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
SECTION 2.15. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit
or similar requirement against assets of, deposits with or for the account
of, or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London
interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), in each
case by an amount deemed material by such Lender, then in accordance with clause
(c) below, the Borrower will pay to such Lender or the Issuing Bank, as the case
may be, such additional amount or amounts as will compensate such Lender or the
Issuing Bank, as the case may be, for such additional costs incurred or
reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in
Law regarding capital requirements has or
65
would have the effect of reducing the rate of return on such Lender's or the
Issuing Bank's capital or on the capital of such Lender's or the Issuing Bank's
holding company, if any, as a consequence of this Agreement or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by the Issuing Bank, to a level below that which such Lender or
the Issuing Bank or such Lender's or the Issuing Bank's holding company could
have achieved but for such Change in Law (taking into consideration such
Lender's or the Issuing Bank's policies and the policies of such Lender's or the
Issuing Bank's holding company with respect to capital adequacy), in each case
by an amount deemed material by such Lender, then in accordance with clause (c)
below, the Borrower will pay to such Lender or the Issuing Bank, as the case may
be, such additional amount or amounts as will compensate such Lender or the
Issuing Bank or such Lender's or the Issuing Bank's holding company for any such
reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or its
holding company, as the case may be, as specified in paragraph (a) or (b) of
this Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender or the Issuing Bank, as the
case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank
to demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation, provided
that the Borrower shall not be required to compensate a Lender or the Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 270 days prior to the date that such Lender or the Issuing Bank, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.
SECTION 2.16. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other
66
than on the last day of the Interest Period applicable thereto, (c) the failure
to borrow, convert, continue or prepay any Revolving Loan or Term Loan on the
date specified in any notice delivered pursuant hereto (regardless of whether
such notice may be revoked under Section 2.11(f) and is revoked in accordance
therewith), or (d) the assignment of any Eurodollar Loan other than on the last
day of the Interest Period applicable thereto as a result of a request by the
Borrower pursuant to Section 2.19, then, in any such event, the Borrower shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurodollar Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO
Rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor (or,
in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Loan), over (ii) the amount of
interest which would accrue on such principal amount for such period at the
interest rate which such Lender would bid were it to bid, at the commencement of
such period, for dollar deposits of a comparable amount and period from other
banks in the eurodollar market. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.
SECTION 2.17. Taxes. (a) Any and all payments by or on account of
any obligation of the Borrower hereunder or under any other Loan Document shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes, provided that if the Borrower shall be required to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or Issuing Bank (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 Governmental Authority in
accordance with applicable law.
67
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each
Lender and the Issuing Bank, within 10 Business Days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent, such Lender or the Issuing Bank, as the case may be,
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder or under any other Loan Document (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or the Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or the Issuing
Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed documentation prescribed by applicable
law or reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate, provided that such Foreign Lender
has received written notice from the Borrower advising it of the availability of
such exemption or reduction and supplying all applicable documentation.
(f) If the Administrative Agent or a Lender (or Transferee)
determines, in its sole discretion, that it has received a refund of any Taxes
or Other Taxes as to which it
68
has been indemnified by the Borrower or with respect to which the Borrower has
paid additional amounts pursuant to this Section 2.17, it shall pay over such
refund to the Borrower (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrower under this Section 2.17 with respect to
the Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket
expenses of the Administrative Agent or such Lender (or Transferee) and without
interest (other than any interest paid by the relevant Governmental Authority
with respect to such refund); provided, however, that the Borrower, upon the
request of the Administrative Agent or such Lender (or Transferee), agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender (or Transferee) in the event the
Administrative Agent or such Lender (or Transferee) is required to repay such
refund to such Governmental Authority. Nothing contained in this Section 2.17(f)
shall require the Administrative Agent or any Lender to make available its tax
returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.
SECTION 2.18. Payments Generally; Pro Rata Treatment: Sharing of
Setoffs. (a) The Borrower shall make each payment required to be made by it
hereunder or under any other Loan Document (whether of principal, interest, fees
or reimbursement of LC Disbursements, or of amounts payable under Section 2.15,
2.16 or 2.17, or otherwise) on or before the time expressly required hereunder
or under such other Loan Document for such payment (or, if no such time is
expressly required, prior to 12:00 noon, New York City time), on the date when
due, in immediately available funds, without setoff or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, except payments to be made directly to the Issuing Bank or
Swingline Lender as expressly provided herein and except that payments pursuant
to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons
entitled thereto and payments pursuant to other Loan Documents shall be made to
the Persons specified therein. The Administrative Agent shall distribute any
such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. If any payment under
any Loan Document shall be due on a day that is not a Business Day, the date for
payment shall be extended
69
to the next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.
All payments under each Loan Document shall be made in dollars.
(b) If at any time insufficient funds are received by and available
to the Administrative Agent to pay fully all amounts of principal, unreimbursed
LC Disbursements, interest and fees then due hereunder, such funds shall be
applied (i) first, towards payment of interest and fees then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, towards payment of
principal and unreimbursed LC Disbursements then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of principal and
unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans, Term Loans or participations in LC
Disbursements or Swingline Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its Revolving Loans, Term Loans
and participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans, provided that (i) if any such participations
are purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any
70
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set off and counterclaim with respect
to such participation as fully as if such Lender were a direct creditor of
the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative
Agent may assume that the Borrower has made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to
the Lenders or the Issuing Bank, as the case may be, the amount due. In such
event, if the Borrower has not in fact made such payment, then each of the
Lenders or the Issuing Bank, as the case may be, severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to
such Lender or Issuing Bank with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date
of payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b), 2.18(d) or
9.03(c), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to
satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.
SECTION 2.19. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS. (a)
Prior to any Lender requesting compensation under Section 2.15, or the
Borrower paying any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, such Lender
shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if,
in the reasonable judgment of such Lender, such designation or assignment (i)
would eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17,
as the case may be, and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to
such Lender. The Borrower hereby agrees to pay all reason-
71
able costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) If any Lender requests compensation under Section 2.15, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent (and,
if a Revolving Commitment is being assigned, the Issuing Bank and Swingline
Lender), which consent shall not unreasonably be withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans and participations in LC Disbursements and Swingline Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
in the case of any such assignment resulting from a claim for compensation under
Section 2.15 or payments required to be made pursuant to Section 2.17, such
assignment will result in a material reduction in such compensation or payments.
A Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.
ARTICLE III
Representations and Warranties
Each of Holdings and the Borrower represents and warrants to the
Lenders that:
SECTION 3.01. Organization: Powers. Each of Holdings, the Borrower
and the Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, has all requisite power
and authority to carry on its business as now conducted and as proposed to be
conducted and, except where
72
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required, except where the failure to be so qualified could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 3.02. Authorization; Enforceability. The Transactions to be
entered into by each Loan Party are within such Loan Party's corporate powers
and have been duly authorized by all necessary corporate and, if required,
stockholder action. This Agreement has been duly executed and delivered by each
of Holdings and the Borrower and constitutes, and each other Loan Document to
which any Loan Party is to be a party, when executed and delivered by such Loan
Party, will constitute, a legal, valid and binding obligation of Holdings, the
Borrower or such Loan Party (as the case may be), enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors' rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions
(a) do not require any consent or approval of, registration or filing with, or
any other action by or before, any Governmental Authority, except such as have
been obtained or made and are in full force and effect and except filings
necessary to perfect Liens created under the Loan Documents, (b) will not
violate any applicable law or regulation or the terms of the charter, by-laws or
other organizational documents of Holdings, the Borrower or any of the
Subsidiaries, or the terms of any of the Authorizations, or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon Holdings, the Borrower or
any of the Subsidiaries or any of their assets, or give rise to a right
thereunder to require any payment to be made by Holdings, the Borrower or any of
the Subsidiaries, except where the aggregate amount of all such required
payments is less than $5,000,000 and where such default could not reasonably be
expected to result in a Material Adverse Effect, and (d) will not result in the
creation or imposition of any Lien on any asset of Holdings, the Borrower or any
of the Subsidiaries, except Liens created under the Loan Documents, provided
that, if the Acquisitions are consummated on different dates, on the Initial
Closing Date the term "Transactions" as referred to above is deemed to include
only the transactions described
73
in the preamble to this Agreement that are supposed to occur on the Initial
Closing Date.
SECTION 3.04. Financial Condition; No Material Adverse Effect. (a)
The Borrower has heretofore furnished to the Lenders (i) audited consolidated
and consolidating balance sheets and related statements of income, stockholder's
equity and cash flows of the Alaska Entities and the ATU Business for the 1998
fiscal year, in each case prepared by a nationally recognized accounting firm
reasonably acceptable to the Administrative Agent, and (ii) unaudited
consolidated and consolidating balance sheets and related statements of income,
stockholder's equity and cash flows of (A) the ATU Business and (B) the Alaska
Entities for (1) each subsequent fiscal quarter ended at least 45 days before
the Start Date and (2) each fiscal month after the most recent 1999 fiscal
quarter for which financial statements were received by the Lenders as described
above and ended at least 45 days before the Start Date. Such financial
statements present fairly, in all material respects, the financial position and
results of operations and cash flows of the Alaska Entities or ATU Business, as
applicable, and their consolidated Subsidiaries as of such dates and for such
periods in accordance with GAAP, subject to year-end audit adjustments and the
absence of footnotes in the case of the statements referred to in clause (ii)
above.
(b) The Borrower has heretofore furnished to the Lenders its pro
forma consolidated balance sheet as of the end of the most recently completed
fiscal quarter of the Borrower that is at least 45 days prior to the Start Date,
prepared giving effect to the Transactions as if the Transactions had occurred
on such date, provided that, if the Acquisitions are consummated on different
dates, on the Initial Closing Date the term "Transactions" as referred to in
this paragraph (b) is deemed to include only the transactions described in the
preamble to this Agreement that are contemplated to occur on the Initial Closing
Date. Such pro forma consolidated balance sheet (i) has been prepared in good
faith based on the same assumptions used to prepare the pro forma financial
statements included in the Information Memorandum (which assumptions are
believed by Holdings and the Borrower to be reasonable), (ii) is based on the
best information available to Holdings and the Borrower after due inquiry, (iii)
accurately reflects all adjustments necessary to give effect to the Transactions
and (iv) presents fairly, in all material respects, the pro forma financial
position of the Borrower and its consolidated Subsidiaries as of the end of the
most recently completed fiscal quarter of the Borrower that is at least 45 days
74
prior to the Start Date, as if the Transactions had occurred on such date.
(c) Except as disclosed in the financial statements referred to
above or the notes thereto or in the Information Memorandum and except for the
Disclosed Matters, after giving effect to the Transactions, none of Holdings,
the Borrower or the Subsidiaries has, as of the Start Date or the Second Closing
Date (if any), any material contingent liabilities, unusual long-term
commitments or unrealized losses.
(d) Since December 31, 1998, there has been no material adverse
effect on the business, assets, results of operations, properties or financial
condition of the Alaska Entities and their respective subsidiaries, taken as a
whole, and since December 31, 1998, there has been no material adverse effect on
the assets, properties, condition (financial and other), business, operations or
liabilities (fixed or contingent) of the ATU Business, taken as a whole.
SECTION 3.05. Properties. (a) Each of Holdings, the Borrower and the
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to its business (including its Mortgaged
Properties), except for such defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes.
(b) Each of Holdings, the Borrower and the Subsidiaries owns, or is
licensed to use, all trademarks, trade names, copyrights, patents and other
intellectual property material to its business, and the use thereof by Holdings,
the Borrower and the Subsidiaries does not infringe upon the rights of any other
Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. Schedule 3.05(b) accurately and completely lists as of the Start Date
and Second Closing Date (if any) (after giving effect to the Transactions to
occur on such date), all Operating Licenses granted or assigned to the Borrower
or any of the Subsidiaries, or under which the Borrower and the Subsidiaries
will have the right to operate their respective businesses.
(c) Schedule 3.05(c) sets forth the address of each real property
that is owned or leased by Holdings, the Borrower or any of the Subsidiaries as
of the Start Date and the Second Closing Date (if any) after giving effect to
the Transactions to occur on such date.
75
(d) As of the Start Date and the Second Closing Date (if any),
neither Holdings, the Borrower nor any of the Subsidiaries has received notice
of, or has knowledge of, any pending or contemplated condemnation proceeding
affecting any Mortgaged Property or any sale or disposition thereof in lieu of
condemnation. Neither any Mortgaged Property nor any interest therein is subject
to any right of first refusal, option or other contractual right to purchase
such Mortgaged Property or interest therein.
SECTION 3.06. Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of Holdings or the Borrower,
threatened against or affecting Holdings, the Borrower or any of the
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect (other
than the Disclosed Matters) or (ii) that involve any of the Loan Documents or
the Transactions.
(b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, neither Holdings, the Borrower
nor any of the Subsidiaries (i) has failed to comply with any Environmental Law
or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has become subject to any
Environmental Liability, (iii) has received notice of any claim with respect to
any Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
(c) Since the date of this Agreement, there has been no change in
the status of the Disclosed Matters that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect.
SECTION 3.07. Compliance with Laws and Agreements. Each of Holdings,
the Borrower and the Subsidiaries is in compliance with all laws, regulations
and orders (including any Environmental Law or Communication Law, margin
regulations, FCC and APUC regulations and ERISA) of any Governmental Authority
applicable to it or its property and all indentures, agreements and other
instruments binding upon it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be
76
expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.
SECTION 3.08. Investment and Holding Company Status. Neither
Holdings, the Borrower nor any of the Subsidiaries is (a) an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act of 1940 or (b) a "holding company" as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935.
SECTION 3.09. Taxes. Each of Holdings, the Borrower and the
Subsidiaries has timely filed or caused to be filed all Tax returns and reports
required to have been filed and has paid or caused to be paid all Taxes required
to have been paid by it, except (a) any Taxes that are being contested in good
faith by appropriate proceedings and for which Holdings, the Borrower or such
Subsidiary, as applicable, has set aside on its books reserves in accordance
with GAAP or (b) failures to file or cause to be filed or pay or cause to be
paid that would not reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability to the Borrower or the Subsidiaries is reasonably expected to
occur, could reasonably be expected to result in a Material Adverse Effect. The
present value of all accumulated benefit obligations under each Plan (based on
the assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the date of the most recent financial statements
reflecting such amounts exceed by more than $5,000,000 the fair market value of
the assets of such Plan, and the present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by more
than $10,000,000 the fair market value of the assets of all such underfunded
Plans.
SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders
all agreements, instruments and corporate or other restrictions to which
Holdings, the Borrower or any of the Subsidiaries is subject, and all other
matters known to any of them, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. Neither the
Information Memorandum nor any of the other reports, financial statements,
certificates or other information furnished by or on behalf of any
77
Loan Party to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or any other Loan Document or delivered hereunder
or thereunder (as modified or supplemented by other information so furnished)
contains any material misstatement of fact or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, provided that, with respect to
projected financial information, Holdings and the Borrower represent only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time such projections were prepared and delivered to the
Administrative Agent.
SECTION 3.12. Subsidiaries. Holdings does not have any subsidiaries
other than the Borrower and the Subsidiaries. Schedule 3.12 sets forth the name
of, and the ownership interest of the Borrower in, each Subsidiary and
identifies each Subsidiary that is a Subsidiary Loan Party, in each case as of
the Start Date and, if and when it occurs, the Second Closing Date.
SECTION 3.13. Insurance. Schedule 3.13 sets forth a description of
all insurance maintained by or on behalf of the Borrower and the Subsidiaries as
of the Start Date and the Second Closing Date, as applicable. As of the Start
Date and the Second Closing Date, as applicable, all premiums in respect of such
insurance have been paid. Holdings and the Borrower believe that the insurance
maintained by or on behalf of the Borrower and the Subsidiaries is adequate with
respect to the Borrower's and the Subsidiaries' businesses.
SECTION 3.14. Labor Matters. As of the Start Date and the Second
Closing Date, as applicable, there are no strikes, lockouts or slowdowns against
Holdings, the Borrower or any Subsidiary pending or, to the knowledge of
Holdings or the Borrower, threatened. The hours worked by and payments made to
employees of Holdings, the Borrower and the Subsidiaries have not been in
material violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters. All payments due
from Holdings, the Borrower or any Subsidiary, or for which any claim may be
made against Holdings, the Borrower or any Subsidiary, on account of wages and
employee health and welfare insurance and other benefits, have been paid or
accrued as a liability on the books of Holdings, the Borrower or such
Subsidiary. The consummation of the Transactions will not give rise to any right
of termination or right of renegotiation on the part of any union under any
78
collective bargaining agreement to which Holdings, the Borrower or any
Subsidiary is bound.
SECTION 3.15. Solvency. Immediately after the consummation of the
Transactions to occur on the Start Date and the Second Closing Date, if any, as
applicable, and immediately following the making of each Loan made on the Start
Date and the Second Closing Date, if any, as applicable, and after giving effect
to the application of the proceeds of such Loans, (a) the fair value of the
assets of each Loan Party, at a fair valuation, will exceed its debts and
liabilities, subordinated, contingent or otherwise; (b) the present fair
saleable value of the property of each Loan Party will be greater than the
amount that will be required to pay the probable liability of its debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (c) each Loan Party will be able
to pay its debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (d) each Loan Party will
not have unreasonably small capital with which to conduct the business in which
it is engaged as such business is now conducted and is proposed to be conducted
following the Start Date.
SECTION 3.16. Senior Indebtedness. The Obligations constitute
"Senior Indebtedness" under and as defined in the Subordinated Debt Documents.
SECTION 3.17. Year 2000. Any reprogramming required to permit the
proper functioning, in and following the year 2000, of (a) the computer systems
of Holdings, the Borrower and the Subsidiaries and (b) equipment containing
embedded microchips (including systems and equipment supplied by others or with
which Holdings's, the Borrower's or the Subsidiaries' systems interface) and the
testing of all such systems and equipment, as so reprogrammed, will be completed
by September 30, 1999. The cost to Holdings, the Borrower and the Subsidiaries
of such reprogramming and testing and of the reasonably foreseeable consequences
of the occurrence of the year 2000 to Holdings, the Borrower and the
Subsidiaries (including reprogramming errors and the failure of others' systems
or equipment) will not result in a Default or a Material Adverse Effect. Except
for the reprogramming referred to in the preceding sentence as may be necessary,
the computer and management information systems of Holdings, the Borrower and
the Subsidiaries are and, with ordinary course upgrading and maintenance, will
continue for the term of this Agreement to be, sufficient to permit Holdings,
the Borrower and the Subsidiaries to conduct their businesses without Material
Adverse Effect.
79
SECTION 3.18. Security Interests. (a) When executed and delivered,
the Pledge Agreement will be effective to create in favor of the Collateral
Agent, for the ratable benefit of the Secured Parties, a legal, valid and
enforceable security interest in the Collateral (as defined in the Pledge
Agreement) and, when the portion of the Collateral constituting certificated
securities (as defined in the Uniform Commercial Code) is delivered to the
Administrative Agent, such security interest shall constitute a fully perfected
first priority Lien on, and security interest in, all right, title and interest
of the pledgor thereunder in such Collateral, in each case prior and superior in
right to any other Person.
(b) The Security Agreement is effective to create in favor of the
Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid
and enforceable security interest in the Collateral (as defined in the Security
Agreement) and, when financing statements in appropriate form are filed in the
offices specified on Schedule 6 to each of the Perfection Certificates, the
Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the grantors thereunder in such
Collateral to the extent perfection can be obtained by filing Uniform Commercial
Code financing statements, other than the Intellectual Property (as defined in
the Security Agreement), in which a security interest may be perfected by
filing, recording or registering a security agreement, financing statement or
analogous document in the United States Patent and Trademark Office or the
United States Copyright Office, as applicable, in each case prior and superior
in right to any other Person to the extent perfection can be obtained by filing
Uniform Commercial Code financing statements, other than with respect to the
rights of Persons pursuant to Liens expressly permitted by Section 6.02.
(c) When the Security Agreement is filed in the United States Patent
and Trademark Office and the United States Copyright Office, the security
interest created thereunder shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the Loan Parties in the
Intellectual Property (as defined in the Security Agreement) in which a security
interest may be perfected by filing, recording or registering a security
agreement, financing statement or analogous document in the United States Patent
and Trademark Office or the United States Copyright Office, as applicable, in
each case prior and superior in right to any other Person, other than with
respect to the rights of Persons pursuant to Liens expressly permitted by
Section 6.02 (it being understood
80
that subsequent recordings in the United States Patent and Trademark Office and
the United States Copyright Office may be necessary to perfect a lien on
registered trademarks, trademark applications and copyrights acquired by the
Loan Parties after the date hereof).
(d) The Mortgages are effective to create, subject to the exceptions
listed in each title insurance policy covering such Mortgage, in favor of the
Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid
and enforceable Lien on all of the Loan Parties' right, title and interest in
and to the Mortgaged Properties thereunder and the proceeds thereof, and when
the Mortgages are filed in the offices specified on Schedule 3.18(d), the
Mortgages shall constitute a Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Mortgaged Properties and the proceeds
thereof, in each case prior and superior in right to any other Person, other
than with respect to the rights of Persons pursuant to Liens expressly permitted
by Section 6.02.
SECTION 3.19. Regulatory Matters. Except for the Disclosed Matters
and except with respect to any other matters that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither Holdings, the Borrower, nor any of the Subsidiaries (a) has
failed to comply with any Communications Law or to obtain, maintain or comply
with any permit, license or other approval required under any Communications
Law, (b) has become subject to any Communication Liability, (c) has received
notice of any claim with respect to any Communication Liability or (d) knows of
any basis for any Communication Liability.
ARTICLE IV
Conditions of Lending
The obligations of the Lenders to make Loans and of the Issuing Bank
to issue Letters of Credit hereunder shall not become effective until the date
on which each of the following conditions is satisfied (or waived in accordance
with Section 9.02):
SECTION 4.01. Each Credit Event. The obligation of each Lender to
make a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue,
amend, renew or
81
extend any Letter of Credit, is subject to receipt of the request therefor in
accordance herewith and to the satisfaction of the following conditions:
(a) The representations and warranties of each Loan Party set forth
in the Loan Documents shall be true and correct on and as of the date of
such Borrowing or the date of issuance, amendment, renewal or extension of
such Letter of Credit, as applicable.
(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default shall have occurred and be
continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by Holdings
and the Borrower on the date thereof as to the matters specified in paragraphs
(a) and (b) of this Section.
SECTION 4.02. First Credit Event-Start Date. On the Start Date:
(a) The Administrative Agent (or its counsel) shall have received
from each party hereto either (i) a counterpart of this Agreement signed
on behalf of such party or (ii) written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a signed
signature page of this Agreement) that such party has signed a counterpart
of this Agreement.
(b) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated
the Start Date) of each of (i) Wachtell, Lipton, ▇▇▇▇▇ & ▇▇▇▇, counsel for
Holdings and the Borrower, substantially in the form of Exhibit B-1, (ii)
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Washington counsel for Holdings and the Borrower,
substantially in the form of Exhibit B-2, (iii) ▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP, FCC
counsel for Holdings and the Borrower, substantially in the form of
Exhibit B-3, (iii) Birch, Horton, ▇▇▇▇▇▇▇ & Cherot, Alaskan regulatory
counsel for Holdings and the Borrower, substantially in the form of
Exhibit B-3, (iv) ▇▇▇▇▇ & ▇▇▇▇▇, intellectual property counsel for
Holdings and the Borrower, substantially in the form of Exhibit B-4, (v)
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ L.L.P., Louisiana counsel for Holdings and the Borrower,
substantially in the form of
82
Exhibit B-5, and (vi) local counsel in each jurisdiction where, if the
Start Date is the Initial Closing Date, a First Acquisition Mortgaged
Property is located or, if the Start Date is the Closing Date, a Mortgaged
Property is located, substantially in the form of Exhibit B-6, and in the
case of each such opinion required by this paragraph, covering such other
matters relating to the Loan Parties, the Loan Documents or the
Transactions as the Required Lenders shall reasonably request. The
Borrower hereby requests such counsel to deliver such opinions.
(c) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization, existence and good standing of each
Loan Party, the authorization of the Transactions to occur on the Start
Date and any other legal matters relating to the Loan Parties, the Loan
Documents or such Transactions all in form and substance satisfactory to
the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a certificate,
dated the Start Date and signed by the President, a Vice President or a
Financial Officer of the Borrower, confirming compliance with the
conditions set forth in paragraphs (a) and (b) of Section 4.01.
(e) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Start Date, including, to the
extent invoiced, reimbursement or payment of all out-of-pocket expenses
(including fees, charges and disbursements of counsel) required to be
reimbursed or paid by any Loan Party hereunder or under any other Loan
Document.
(f) The Administrative Agent shall have received counterparts of the
Security Agreement, the Pledge Agreement and the Indemnity, Subrogation
and Contribution Agreement, each signed on behalf of the Borrower,
Holdings and each Subsidiary Loan Party, if the Acquisitions are
consummated simultaneously, or First Acquisition Subsidiary Loan Party if
the Acquisitions are consummated on different dates, together with the
following:
(i) stock certificates representing all the outstanding shares
of capital stock of the Borrower and each Subsidiary owned by or on
behalf of any Loan Party as of the Start Date after giving effect to
the First Acquisition or the
83
Transactions, as applicable (except that stock certificates
representing shares of common stock of a Foreign Subsidiary may be
limited to 65% of the outstanding shares of common stock of such
Foreign Subsidiary), promissory notes evidencing all intercompany
Indebtedness owed to any Loan Party by Holdings, the Borrower or any
Subsidiary as of the Start Date after giving effect to the First
Acquisition or the Transactions, as applicable, and stock powers and
instruments of transfer, endorsed in blank, with respect to such
stock certificates and promissory notes;
(ii) all documents and instruments, including Uniform
Commercial Code financing statements, required by law or reasonably
requested by the Administrative Agent to be filed, registered or
recorded to create or perfect the Liens on the Collateral owned or
to be acquired on or before the Start Date and intended to be
created under the Security Agreement; and
(iii) a completed Perfection Certificate dated the Start Date
and signed by an executive officer or Financial Officer of the
Borrower, together with all attachments contemplated thereby,
including the results of a search of the Uniform Commercial Code (or
equivalent) filings made with respect to the Loan Parties, if the
Acquisitions are consummated simultaneously, or the First
Acquisition Loan Parties, if the Acquisitions are consummated on
different dates, in the jurisdictions contemplated by the Perfection
Certificate and copies of the financing statements (or similar
documents) disclosed by such search and evidence reasonably
satisfactory to the Administrative Agent that the Liens indicated by
such financing statements (or similar documents) are permitted by
Section 6.02 or have been released.
(g) The Administrative Agent shall have received (i) counterparts of
a Mortgage with respect to each Mortgaged Property owned or to be acquired
by the Borrower or any Subsidiary on the Start Date, signed on behalf of
the record owner of such Mortgaged Property, (ii) a policy or policies of
title insurance issued by a nationally recognized title insurance company,
insuring the Lien of each such Mortgage as a valid first Lien on the
Mortgaged Property described therein, free of any other Liens except as
permitted by Section 6.02, together with such endorsements, coinsur-
84
ance and reinsurance as the Collateral Agent or the Required Lenders may
reasonably request.
(h) The Administrative Agent shall have received evidence that the
insurance required by Section 5.07 and the Security Documents is in
effect.
(i) All consents and approvals required to be obtained from any
Governmental Authority or other Person (including the final consents,
approvals or non-objection of the FCC or the APUC) in connection with the
Acquisitions or, if the Acquisitions are consummated on different dates,
the First Acquisition shall have been obtained, and all applicable waiting
periods and appeal periods shall have expired (other than any appeal
period of the consents and approvals required by the APUC to assign the
Operating Licenses of the State of Alaska and the appeal periods of the
FCC Operating Licenses listed on Schedule 4.02(i)). in each case without
the imposition of any conditions reasonably expected to have a Material
Adverse Effect or to affect the rights or security of the Lenders
hereunder.
(j) The Lenders shall have received a pro forma consolidated balance
sheet of Holdings as of the end of the most recently completed fiscal
quarter of the Borrower that is at least 45 days prior to the Start Date,
reflecting all pro forma adjustments as if the First Acquisition or, if
the Acquisitions occur simultaneously, the Transactions, had been
consummated on such date, and such pro forma consolidated balance sheet
shall be consistent in all material respects with the forecasts and other
information previously provided to the Lenders.
(k) The Administrative Agent shall have received a solvency letter,
in form and substance satisfactory to the Lenders, from ▇▇▇▇▇▇, ▇▇▇▇▇▇ &
Co., Inc., with respect to the solvency of the First Acquisition Loan
Parties or, if the Acquisitions are consummated simultaneously, with
respect to the solvency of all the Loan Parties, each after giving effect
to the First Acquisition or the Transactions, as applicable.
(l) The tax position and contingent tax and other liabilities of
Holdings, the Borrower and the Subsidiaries after giving effect to the
First Acquisition or, if the Acquisitions are consummated simultaneously,
the Transactions shall be satisfactory to the Administrative Agent and the
Lenders.
85
(m) Each of the Guarantee Agreements of (i) the First Acquisition
Loan Parties (other than the Borrower) or, (ii) if the Acquisitions are
consummated simultaneously, the Loan Parties (other than the Borrower)
shall have been duly executed by the parties thereto and delivered to the
Collateral Agent and shall be in full force and effect.
(n) (i) If the Start Date is the Closing Date, each of the
Acquisitions shall be consummated simultaneously with the Start Date in
accordance with applicable law, the PTI Purchase Agreement or the ATU
Purchase Agreement, as applicable (without giving effect to any amendments
or waivers to the PTI Purchase Agreement or the ATU Purchase Agreement
that are adverse to the Lenders and not reasonably satisfactory to the
Lenders), and all other related documentation satisfactory to the Lenders,
and all the Equity Contributions shall have been made, or (ii) if the
Start Date is the Initial Closing Date, the First Acquisition shall have
been consummated in accordance with applicable law, the PTI Purchase
Agreement or the ATU Purchase Agreement, as applicable (without giving
effect to any amendments or waivers to the PTI Purchase Agreement or the
ATU Purchase Agreement that are adverse to the Lenders and not reasonably
satisfactory to the Lenders), and all other related documentation
satisfactory to the Lenders, and (A) if the PTI Acquisition is the First
Acquisition, the Borrower shall receive or shall have previously received
$65,000,000 of the proceeds from the Equity Contributions as of the Start
Date and (B) if the ATU Acquisition is the First Acquisition, the Borrower
shall receive or shall have previously received $80,000,000 of the
proceeds from the Equity Contributions as of the Start Date, and the
Lenders shall (x) be satisfied with the capitalization, structure and
equity ownership of Holdings and the Borrower after giving effect to the
Transactions to occur on or before such date (it being agreed that the
capitalization, structure and equity ownership of Holdings and the
Borrower to the extent described elsewhere in this Agreement are
satisfactory to the Lenders) and (y) be satisfied that the Transaction
Costs, whether incurred or paid on or before the earlier of the Closing
Date and the Second Closing Date, as applicable, shall not exceed
$50,000,000. The Administrative Agent shall have received copies of the
applicable Acquisition Documents and all certificates, opinions and other
documents delivered thereunder, certified by a Financial Officer as
complete and correct.
86
(o) After giving effect to the First Acquisition or the
Transactions, as applicable, and the other transactions contemplated
hereby to occur on or before such date, Holdings and its subsidiaries
shall have outstanding no Indebtedness or preferred stock other than (a)
the loans and other extensions of credit hereunder, (b) the Senior
Subordinated Notes, (c) if the ATU Acquisition is consummated, the
Holdings Discount Debentures, and (d) other Indebtedness permitted under
Sections 6.01(a) (i) through (v).
(p) If the ATU Acquisition is consummated, the terms and conditions
of the Holdings Discount Debentures (including but not limited to terms
and conditions relating to the interest rate, payment-in-kind features and
redemption) shall be satisfactory in all respects to the Lenders.
(q) The Lenders shall have received (i) audited consolidated and
consolidating balance sheets and related statements of income,
stockholder's equity and cash flows of the Alaska Entities and the ATU
Business for the 1998 fiscal year, in each case prepared by a nationally
recognized accounting firm reasonably acceptable to the Agent, and (ii)
unaudited consolidated and consolidating balance sheets and related
statements of income, stockholder's equity and cash flows of (A) the ATU
Business and (B) the Alaska Entities for (1) each subsequent fiscal
quarter ended at least 45 days before the Start Date and (2) each fiscal
month after the most recent 1999 fiscal quarter for which financial
statements were received by the Lenders as described above and ended at
least 45 days before the Start Date.
(r) In the case of borrowings on the Start Date to finance the ATU
Acquisition, the Lenders shall be reasonably satisfied as to the amount
and nature of any environmental and employee health and safety exposures
to which the ATU Business may be subject after giving effect to the
Transactions, and with the plans of the Borrower with respect thereto, and
the Lenders shall have received environmental assessments (including Phase
I and Phase II reports) satisfactory to the Administrative Agent from an
environmental consulting firm satisfactory to the Administrative Agent.
(s) In the case of borrowings on the Start Date to finance the ATU
Acquisition, after giving effect to the First Acquisition and the other
transactions contemplated hereby to occur on or before such date,
87
the Administrative Agent shall be reasonably satisfied (i) with the
resolution of the Year 1999 problem with respect to the computer,
financial and other information systems of the ATU Business and (ii) that
the measures taken and proposed to be taken by the Borrower to address any
potential Year 2000 problems with respect to the computer, financial and
other information systems of the ATU Business will be sufficient to insure
that the ATU Business does not suffer any material adverse consequences as
a result of such problems.
(t) In the case of borrowings on the Start Date to finance the PTI
Acquisition, the Borrower shall have received not less than $115,000,000
in gross cash proceeds from the issuance of the Senior Subordinated Notes
in a public offering or in a Rule 144A offering or other private placement
to one or more holders satisfactory to the Agent. The terms and conditions
of the Senior Subordinated Notes shall be reasonably satisfactory to the
Administrative Agent.
(u) If the Acquisitions are consummated on different dates and the
PTI Acquisition is not the First Acquisition, the Sponsor shall have
entered into a written agreement with the Borrower, in form and substance
satisfactory to the Administrative Agent, that provides for the making of
the Additional Equity Contribution as required by Section 5.17.
The Administrative Agent shall notify the Borrower and the Lenders of the Start
Date, and such notice shall be conclusive and binding. Notwithstanding the
foregoing, the obligations of the Lenders to make Loans and of the Issuing Bank
to issue Letters of Credit hereunder shall not become effective unless each of
the foregoing conditions is satisfied (or waived pursuant to Section 9.02) at or
prior to 5:00 p.m., New York City time, on December 31, 1999 (and, in the event
such conditions are not so satisfied or waived at or prior to such time, the
Commitments shall terminate at such time).
SECTION 4.03. Second Closing Date. On the Second Closing Date, if
any:
(a) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated
the Second Closing Date) of each of (i) Wachtell, Lipton, ▇▇▇▇▇ & ▇▇▇▇,
counsel for Holdings and the Borrower, substantially in the form of
Exhibit B-1, (ii) ▇▇▇▇▇▇▇
88
Harwood, Washington counsel for Holdings and the Borrower, substantially
in the form of Exhibit B-2, (iii) ▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP, FCC counsel for
Holdings and the Borrower, substantially in the form of Exhibit B-3, (iii)
Birch, Horton, ▇▇▇▇▇▇▇ & Cherot, Alaskan regulatory counsel for Holdings
and the Borrower, substantially in the form of Exhibit B-3, (iv) ▇▇▇▇▇ &
▇▇▇▇▇, intellectual property counsel for Holdings and the Borrower,
substantially in the form of Exhibit B-4, (v) ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ L.L.P.,
Louisiana counsel for Holdings and the Borrower, substantially in the form
of Exhibit B-5, and (vi) local counsel in each jurisdiction where, if the
Start Date is the Initial Closing Date, a First Acquisition Mortgaged
Property is located or, if the Start Date is the Closing Date, a Mortgaged
Property is located, substantially in the form of Exhibit B-6, and, in the
case of each such opinion required by this paragraph, covering such other
matters relating to the Loan Parties, the Loan Documents or the
Transactions as the Required Lenders shall reasonably request. The
Borrower hereby requests such counsel to deliver such opinions.
(b) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization, existence and good standing of each
Loan Party, the authorization of the Second Acquisition and any other
legal matters relating to the Loan Parties, the Loan Documents or the
Second Acquisition, all in form and substance satisfactory to the
Administrative Agent and its counsel.
(c) The Administrative Agent shall have received a certificate,
dated the Second Closing Date and signed by the President, a Vice
President or a Financial Officer of the Borrower, confirming compliance
with the conditions set forth in paragraphs (a) and (b) of Section 4.01.
(d) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Second Closing Date, including,
to the extent invoiced, reimbursement or payment of all out-of-pocket
expenses (including fees, charges and disbursements of counsel) required
to be reimbursed or paid by any Loan Party hereunder or under any other
Loan Document.
(e) The Administrative Agent shall have received counterparts of the
Security Agreement, the Pledge Agreement and the Indemnity, Subrogation
and Contribu-
89
tion Agreement, each previously signed on behalf of the Borrower and
Holdings and signed by each Second Acquisition Subsidiary Loan Party,
together with the following:
(i) stock certificates representing all the outstanding shares
of capital stock of each Subsidiary owned by or on behalf of any
Loan Party and acquired on the Second Closing Date (except that
stock certificates representing shares of common stock of a Foreign
Subsidiary may be limited to 65% of the outstanding shares of common
stock of such Foreign Subsidiary), promissory notes evidencing all
intercompany Indebtedness owed to any Loan Party by any Subsidiary
acquired on the Second Closing Date and stock powers and instruments
of transfer, endorsed in blank, with respect to such stock
certificates and promissory notes;
(ii) all documents and instruments, including Uniform
Commercial Code financing statements, required by law or reasonably
requested by the Administrative Agent to be filed, registered or
recorded to create or perfect the Liens intended to be created under
the Security Agreement; and
(iii) a completed Perfection Certificate dated the Second
Closing Date and signed by an executive officer or Financial Officer
of the Borrower, together with all attachments contemplated thereby,
including the results of a search of the Uniform Commercial Code (or
equivalent) filings made with respect to the Loan Parties acquired
on the Second Closing Date in the jurisdictions contemplated by the
Perfection Certificate and copies of the financing statements (or
similar documents) disclosed by such search and evidence reasonably
satisfactory to the Administrative Agent that the Liens indicated by
such financing statements (or similar documents) are permitted by
Section 6.02 or have been released.
(f) The Administrative Agent shall have received (i) counterparts of
a Mortgage with respect to each Second Acquisition Mortgaged Property
signed on behalf of the record owner of such Second Acquisition Mortgaged
Property, (ii) a policy or policies of title insurance issued by a
nationally recognized title insurance company, insuring the Lien of each
such Mortgage as a valid first Lien on the Second Acqui-
90
sition Mortgaged Property described therein, free of any other Liens
except as permitted by Section 6.02, together with such endorsements,
coinsurance and reinsurance as the Collateral Agent or the Required
Lenders may reasonably request, and (iii) such surveys, abstracts and
appraisals as may be required pursuant to such Mortgages or as the
Administrative Agent or the Required Lenders may reasonably request.
(g) The Administrative Agent shall have received evidence that
the insurance required by Section 5.07 and the Security Documents is in
effect.
(h) All consents and approvals required to be obtained from any
Governmental Authority or other Person (including the final consents,
approvals or non-objection of the FCC or the APUC) in connection with
the Second Acquisition shall have been obtained, and all applicable
waiting periods and appeal periods shall have expired (other than any
appeal period of the consents and approvals required by the APUC to
assign the Operating Licenses of the State of Alaska and the appeal
periods of the FCC Operating Licenses listed on Schedule 4.02(i)), in
each case without the imposition of any conditions reasonably expected
to have a Material Adverse Effect or to affect the rights or security
of the Lenders hereunder.
(i) The Lenders shall have received a pro forma consolidated
balance sheet of Holdings as of the end of the most recently completed
fiscal quarter of the Borrower that is at least 45 days prior to the
Second Closing Date, reflecting all pro forma adjustments as if the
Transactions had been consummated on such date, and such pro forma
consolidated balance sheet shall be consistent in all material respects
with the forecasts and other information previously provided to the
Lenders.
(j) The Administrative Agent shall have received a solvency
letter, in form and substance satisfactory to the Lenders, from ▇▇▇▇▇▇,
▇▇▇▇▇▇ & Co., Inc., with respect to the solvency of the Loan Parties
after giving effect to the Second Acquisition.
(k) The tax position and contingent tax and other liabilities of
Holdings, the Borrower and the Subsidiaries after giving effect to the
Second Acquisition shall be satisfactory to the Administrative Agent
and the Lenders.
91
(l) Each of the Guarantee Agreements of the Second Acquisition Loan
Parties shall have been duly executed by the parties thereto and delivered
to the Collateral Agent and shall be in full force and effect.
(m) The Second Acquisition shall have been consummated in accordance
with applicable law, the PTI Purchase Agreement or the ATU Purchase
Agreement, as applicable (without giving effect to any amendments or
waivers to the PTI Purchase Agreement or the ATU Purchase Agreement that
are adverse to the Lenders and not reasonably satisfactory to the
Lenders), and all other related documentation satisfactory to the Lenders,
and the Borrower shall receive or shall have previously received the
Equity Contributions, and the Lenders shall (x) be satisfied with the
capitalization, structure and equity ownership of Holdings and the
Borrower after giving effect to the Transactions to occur on or before the
Second Closing Date (it being agreed that the capitalization, structure
and equity ownership of Holdings and the Borrower to the extent described
elsewhere in this Agreement are satisfactory to the Lenders) and (y) be
satisfied that the Transaction Costs as incurred or paid on or before the
Second Closing Date shall not exceed $50,000,000. The Administrative Agent
shall have received copies of the Acquisition Documents and all
certificates, opinions and other documents delivered thereunder, certified
by a Financial Officer as complete and correct.
(n) After giving effect to the Second Acquisition and the other
transactions contemplated hereby to occur on or before the Second Closing
Date, Holdings and its subsidiaries shall have outstanding no Indebtedness
or preferred stock other than (a) the loans and other extensions of credit
hereunder, (b) the Senior Subordinated Notes, (c) the Holdings Discount
Debentures and (d) other Indebtedness permitted under Section 6.01.
(o) The terms and conditions of the Holdings Discount Debentures
(including but not limited to terms and conditions relating to the
interest rate, payment-in-kind features and redemption) shall be
satisfactory in all respects to the Lenders.
(p) The Lenders shall have received (i) audited consolidated and
consolidating balance sheets and related statements of income,
stockholder's equity and cash flows of the Alaska Entities and ATU for the
1998 fiscal year, in each case prepared by a nationally
92
recognized accounting firm reasonably acceptable to the Agent, and (ii)
unaudited consolidated and consolidating balance sheets and related
statements of income, stockholder's equity and cash flows of (A) ATU and
(B) the Alaska Entities for (l) each subsequent fiscal quarter ended at
least 45 days before the Second Closing Date and (2) each fiscal month
after the most recent 1999 fiscal quarter for which financial statements
were received by the Lenders as described above and ended at least 45 days
before the Second Closing Date.
(q) In the case of borrowings on the Second Closing Date to finance
the ATU Acquisition, the Lenders shall be reasonably satisfied as to the
amount and nature of any environmental and employee health and safety
exposures to which the ATU Business may be subject after giving effect to
the Transactions, and with the plans of the Borrower with respect thereto,
and the Lenders shall have received environmental assessments (including
Phase I and Phase II reports) satisfactory to the Agent from an
environmental consulting firm satisfactory to the Agent.
(r) In the case of borrowings on the Second Closing Date to finance
the ATU Acquisition, after giving effect to the Transactions and the other
transactions contemplated hereby to occur on or before such date, the
Agent shall be reasonably satisfied (i) with the resolution of the Year
1999 problem with respect to the computer, financial and other information
systems of the ATU Business and (ii) that the measures taken and proposed
to be taken by the Borrower to address any potential Year 2000 problems
with respect to the computer, financial and other information systems of
the ATU Business will be sufficient to insure that the ATU Business does
not suffer any material adverse consequences as a result of such problems.
(s) In the case of borrowings on the Second Closing Date to finance
the PTI Acquisition, the Borrower shall have received not less than
$115,000,000 in gross cash proceeds from the issuance of the Senior
Subordinated Notes in a public offering or in a Rule 144A offering or
other private placement to one or more holders satisfactory to the Agent.
The terms and conditions of the Senior Subordinated Notes shall be
reasonably satisfactory to the Agent.
The Administrative Agent shall notify the Borrower and the Lenders of the Second
Closing Date, if any, and such notice
93
shall be conclusive and binding. Notwithstanding the foregoing, the obligations
of the Lenders to make Loans on the Second Closing Date and of the Issuing Bank
to issue Letters of Credit hereunder on such date shall not become effective
unless each of the foregoing conditions is satisfied (or waived pursuant to
Section 9.02) at or prior to 5:00 p.m., New York City time, on December 31, 1999
(and, in the event such conditions are not so satisfied or waived at or prior to
such time, the Commitments shall terminate at such time).
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, each of Holdings and the
Borrower covenants and agrees with the Lenders that:
SECTION 5.01. Financial Statements and Other Information. The
Borrower will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the
Borrower, Holdings's audited consolidated and unaudited consolidating
balance sheet and related statements of operations, stockholders' equity
and cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all
reported on by Deloitte & Touche LLP or other independent public
accountants of recognized national standing (without a "going concern" or
like qualification or exception and without any qualification or exception
as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of Holdings and its consolidated
subsidiaries on a consolidated basis in accordance with GAAP consistently
applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, Holdings's consolidated and
consolidating balance sheet and related statements of operations,
stockholders' equity and cash flows as of the end of and for such fiscal
quarter and the then elapsed
94
portion of the fiscal year, setting forth in each case in comparative form
the figures for the corresponding period or periods of (or, in the case of
the balance sheet, as of the end of) the previous fiscal year, all
certified by one of its Financial Officers as presenting fairly in all
material respects the financial condition and results of operations of
Holdings and its consolidated subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;
(c) within 30 days after the end of each of the first two fiscal
months of each fiscal quarter of the Borrower, Holdings's consolidated
balance sheet and related statements of operations, stockholders' equity
and cash flows as of the end of and for such fiscal month and the then
elapsed portion of the fiscal year, all certified by one of its Financial
Officers as presenting in all material respects the financial condition
and results of operations of Holdings and its consolidated subsidiaries on
a consolidated basis in accordance with GAAP consistently applied, subject
to normal year-end audit adjustments and the absence of footnotes;
(d) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken
or proposed to be taken with respect thereto, (ii) setting forth
reasonably detailed calculations demonstrating compliance with Sections
6.12, 6.13 and 6.14 and (iii) stating whether any change in GAAP or in the
application thereof has occurred since the date of the Borrower's audited
financial statements referred to in Section 3.04 and, if any such change
has occurred, specifying the effect of such change on the financial
statements accompanying such certificate;
(e) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during
the course of their examination of such financial statements of any
Default (which certificate may be limited to the extent required by
accounting rules or guidelines);
95
(g) at least 30 days prior to the commencement of each fiscal year
of the Borrower, a detailed consolidated budget for such fiscal year
(including a projected consolidated balance sheet and related statements
of projected operations and cash flow as of the end of and for such fiscal
year and setting forth the assumptions used for purposes of preparing such
budget) and, promptly when available, any significant revisions of such
budget;
(h) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
Holdings, the Borrower or any Subsidiary with the Securities and Exchange
Commission, the FCC or the APUC, or any Governmental Authority succeeding
to any or all of the functions of said Commission, the FCC or the APUC, as
applicable, or with any national securities exchange, or distributed by
Holdings to its shareholders generally, as the case may be; and
(i) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of
Holdings, the Borrower or any Subsidiary, or compliance with the terms of
any Loan Document, as the Administrative Agent or any Lender may
reasonably request in connection with the Loan Documents.
SECTION 5.02. Notices of Material Events. Holdings and the Borrower
will furnish to the Administrative Agent and each Lender prompt written notice
of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or affecting
Holdings, the Borrower or any Affiliate thereof that, if adversely
determined, could reasonably be expected to result in a Material Adverse
Effect;
(c) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of Holdings, the Borrower and the Subsidiaries in an
aggregate amount exceeding $3,000,000;
(d) the commencement of any proceeding by or before any Governmental
Authority seeking the cancela-
96
tion, termination (including by means of non-renewal), limitation, adverse
modification or adverse conditioning of any Authorization or Operating
License; and
(e) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 5.03. Information Regarding Collateral. (a) The Borrower
will furnish to the Administrative Agent prompt written notice of any change (i)
in any Loan Party's corporate name or in any trade name used to identify it in
the conduct of its business or in the ownership of its properties, (ii) in the
location of any Loan Party's chief executive office, its principal place of
business, any office in which it maintains books or records relating to
Collateral owned by it or any office or facility at which Collateral owned by it
is located (including the establishment of any such new office or facility),
(iii) in any Loan Party's identity or corporate structure or (iv) in any Loan
Party's Federal Taxpayer Identification Number. Holdings and the Borrower agree
not to effect or permit any change referred to in the preceding sentence unless
all filings have been made under the Uniform Commercial Code or otherwise that
are required in order for the Administrative Agent to continue at all times
following such change to have a valid, legal and perfected security interest in
all the Collateral. Holdings and the Borrower also agree promptly to notify the
Administrative Agent if any material portion of the Collateral is damaged or
destroyed.
(b) Each year, at the time of delivery of annual financial
statements with respect to the preceding fiscal year pursuant to clause (a) of
Section 5.01, the Borrower shall deliver to the Administrative Agent a
certificate of a Financial Officer and the chief legal officer of the Borrower
(i) setting forth the information required pursuant to the Perfection
Certificate or confirming that there has been no change in such information
since the date of the Perfection Certificate delivered on the Start Date, the
Second Closing Date, if any, or the date of the most recent certificate
delivered pursuant to this Section and (ii) certifying that all Uniform
Commercial Code financing statements (including fixture filings, as applicable)
or other appropriate filings, recordings or registrations,
97
including all refilings, rerecordings and reregistrations, containing a
description of the Collateral have been filed of record in each governmental,
municipal or other appropriate office in each jurisdiction identified pursuant
to clause (i) above to the extent necessary to protect and perfect the security
interests under the Collateral Agreement for a period of not less than 18 months
after the date of such certificate (except as noted therein with respect to any
continuation statements to be filed within such period).
SECTION 5.04. Existence; Conduct of Business. Each of Holdings and
the Borrower will, and will cause each of the Subsidiaries to, do or cause to be
done all things necessary to preserve, renew or replace and keep in full force
and effect its legal existence and the rights, licenses, permits, privileges,
franchises, patents, copyrights, trademarks and trade names material to the
conduct of its business, including the renewal and maintenance of all
Authorizations, except for those the failure to maintain, preserve or keep in
full force and effect would not reasonably be expected to have a Material
Adverse Effect, and Operating Licenses, provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under
Section 6.03.
SECTION 5.05. Payment of Obligations. Each of Holdings and the
Borrower will, and will cause each of the Subsidiaries to, pay its Indebtedness
and other obligations, including Tax liabilities, before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) Holdings, the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP, (c) such contest effectively suspends
collection of the contested obligation and the enforcement of any Lien securing
such obligation and (d) the failure to make payment pending such contest could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06. Maintenance of Properties. Each of Holdings and the
Borrower will, and will cause each of the Subsidiaries to, keep and maintain all
property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and are and will be in compliance
with all terms and conditions of the Operating Licenses and Authorizations and
all Communications Laws, including all standards or rules imposed by the FCC and
APUC or as imposed under any agreements with telephone companies and customers,
except where the failure to do so could not
98
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.07. Insurance. Each of Holdings and the Borrower will, and
will cause each of the Subsidiaries to, maintain, with financially sound and
reputable insurance companies or associations (a) insurance in such amounts
(with no greater risk retention) and against such risks as are customarily
maintained by companies of established repute engaged in the same or similar
businesses operating in the same or similar locations and (b) all insurance
required to be maintained pursuant to the Security Documents. The Borrower will
furnish to the Lenders, upon request of the Administrative Agent, information in
reasonable detail as to the insurance so maintained.
SECTION 5.08. Casualty and Condemnation. (a) The Borrower (a) will
furnish to the Administrative Agent and the Lenders prompt written notice of any
casualty or other insured damage to any material portion of the Collateral or
the commencement of any action or proceeding for the taking of any Collateral or
any part thereof or interest therein under power of eminent domain or by
condemnation or similar proceeding and (b) will ensure that the Net Proceeds of
any such event (whether in the form of insurance proceeds, condemnation awards
or otherwise) are collected and applied in accordance with the applicable
provisions of the Security Documents.
SECTION 5.09. Books and Records; Inspection and Audit Rights. Each
of Holdings and the Borrower will, and will cause each of the Subsidiaries to,
keep proper books of record and account in which full, true and correct entries
are made of all dealings and transactions in relation to its business and
activities. Each of Holdings and the Borrower will, and will cause each of the
Subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender, upon reasonable prior notice, to visit and inspect its
properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably requested.
SECTION 5.10. Compliance with Laws. Each of Holdings and the
Borrower will, and will cause each of the Subsidiaries to, comply with all laws,
rules, regulations and orders, including Environmental Laws, of any Governmental
Authority applicable to it or its property, including the payment of any
regulatory fees required by the FCC and APUC, any fees associated with the
Operating Licenses or
100
will the aggregate principal amount of outstanding Revolving Borrowings on (a)
the Initial Closing Date exceed $50,000,000 and (b) the Second Closing Date
exceed $70,000,000.
(iii) If the Acquisitions are consummated on different dates and the
PTI Acquisition is the First Acquisition, then (A) on the Initial Closing
Date, the proceeds of the PTI Term Facilities Indebtedness will be used by
the Borrower, together with (1) $65,000,000 of the proceeds from the
Equity Contributions, (2) the net proceeds of the issuance of the Senior
Subordinated Notes and (3) Revolving Borrowings in an aggregate principal
amount not to exceed the amount, if positive, of the PTI Adjustment
Amount, to (x) pay the PTI Purchase Price, (y) repay the existing debt of
the Alaska Entities and (z) pay a portion of the Transaction Costs not to
exceed $25,000,000 and (B) on the Second Closing Date, the proceeds of the
ATU Term Facilities Indebtedness will be used by the Borrower, together
with (1) the proceeds from the Equity Contributions (less any portion of
the Equity Contributions made in connection with the PTI Acquisition) and
(2) Revolving Borrowings in an aggregate principal amount not to exceed
$7,700,000 plus the sum of the Net Plant Amount and the Net Cash Amount,
to (I) pay the ATU Purchase Price and (II) pay the portion of the
Transaction Costs not paid prior to the Second Closing Date.
Notwithstanding the foregoing, if the PTI Acquisition is the First
Acquisition, in no event will the aggregate principal amount of
outstanding Revolving Borrowings on (a) the Initial Closing Date exceed
$20,000,000 and (b) the Second Closing Date exceed $70,000,000.
(b) The proceeds of Revolving Loans, other than those referred to in
paragraph (a) above, will be used by the Borrower for general corporate
purposes, including, at any time after the earlier of the Closing Date, the
Second Closing Date and December 31, 1999, Permitted Acquisitions.
(c) Letters of credit will be used by the Borrower for general
corporate purposes.
(d) No part of the proceeds of any Loan will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations G, U and X.
SECTION 5.12. Additional Subsidiaries. If any additional Subsidiary
is formed or acquired after the Start
101
Date, the Borrower will notify the Administrative Agent thereof and (a) if such
Subsidiary is a Subsidiary Loan Party, the Borrower will cause such Subsidiary
to become a party to the Subsidiary Guarantee Agreement, the Indemnity,
Subrogation and Contribution Agreement and each other applicable Security
Document within ten Business Days after such Subsidiary is formed or acquired,
and, within fifteen Business Days after such Subsidiary is formed or acquired,
take such actions to create and perfect Liens on such Subsidiary's assets to
secure the Obligations as the Administrative Agent or the Required Lenders shall
reasonably request and (b) if any Equity Interest in or Indebtedness of such
Subsidiary are owned by or on behalf of any Loan Party, the Borrower will cause
such Equity Interests and promissory notes evidencing such Indebtedness to be
pledged pursuant to the Pledge Agreement within ten Business Days after such
Subsidiary is formed or acquired (except that, if such Subsidiary is a Foreign
Subsidiary, shares of common stock of such Subsidiary to be pledged pursuant to
the Pledge Agreement may be limited to 65% of the outstanding shares of common
stock of such Subsidiary).
SECTION 5.13. Further Assurances. (a) Each of Holdings and the
Borrower will, and will cause each Subsidiary Loan Party to, execute any and all
further documents, financing statements, agreements and instruments, and take
all such further actions (including the filing and recording of financing
statements, fixture filings, mortgages, deeds of trust and other documents),
which may be required under any applicable law, or which the Administrative
Agent or the Required Lenders may reasonably request, to effectuate the
transactions contemplated by the Loan Documents or to grant, preserve, protect
or perfect the Liens created or intended to be created by the Security Documents
or the validity or priority of any such Lien, all at the expense of the Loan
Parties. Holdings and the Borrower also agree to provide to the Administrative
Agent, from time to time upon request, evidence reasonably satisfactory to the
Administrative Agent as to the perfection and priority of the Liens created or
intended to be created by the Security Documents.
(b) If any material assets (including any real property or
improvements thereto or any interest therein) are acquired by the Borrower or
any Subsidiary Loan Party after the Start Date or Second Closing Date, as
applicable (other than assets constituting Security under the Security Agreement
that become subject to the Lien of the Security Agreement upon acquisition
thereof), the Borrower will notify the Administrative Agent and the Lenders
thereof, and, if requested by the Administrative Agent or the Required Lenders,
the Borrower will cause such assets to be
102
subjected to a Lien securing the Obligations and will take, and cause the
Subsidiary Loan Parties to take, such actions as shall be necessary or
reasonably requested by the Administrative Agent to grant and perfect such
Liens, including actions described in paragraph (a) of this Section, all at the
expense of the Loan Parties.
(c) Upon the request of the Administrative Agent, to the extent
permitted by applicable law at the time of such request, grant or cause the
applicable Subsidiaries to grant, to the Administrative Agent, a direct security
interest in the Operating Licenses within 30 days after receipt of such request,
provided that to the extent FCC or APUC consent shall be required in connection
with granting such security interest, such consent shall be requested within 30
days after receipt of such request and upon receipt of such FCC or APUC consent,
such security interest shall be granted within 10 Business Days thereof.
SECTION 5.14. Interest Rate Protection. As promptly as practicable,
and in any event within 120 days after the Start Date and the Second Closing
Date, if any, the Borrower will enter into, and thereafter for a period of not
less than three years will maintain in effect, one or more interest rate
protection agreements on such terms and with such parties as shall be reasonably
satisfactory to the Administrative Agent, the effect of which shall be to fix or
limit the interest cost to the Borrower with respect to at least 50% of the
outstanding Term Loans.
SECTION 5.15. Operating Licenses. Holdings and the Borrower agree to
take all actions necessary or desirable to cause, not later than 60 days after
the Start Date (or 60 days after the Second Closing Date, in the case of
Operating Licenses to be acquired pursuant to the Second Acquisition on the
Second Closing Date) each Operating License acquired on or before such date to
be issued in the name of, or validly assigned to, a License Subsidiary, and
thereafter to cause all Title III authorizations issued by the FCC and all other
Operating Licenses to continue to be held by License Subsidiaries.
SECTION 5.16. After-Acquired Licenses. Unless the Borrower and the
Administrative Agent shall otherwise agree, cause each after-acquired Operating
License to be held in a separate License Subsidiary, provided that to the extent
the Borrower shall not have received FCC or APUC approval with respect to the
foregoing at the scheduled closing of the acquisition of such Operating License,
the Borrower shall comply with the foregoing requirement as soon
103
as practicable following such acquisition (but in any event within 60 days after
such acquisition).
SECTION 5.17. Obtain Additional Equity Contribution. If the
Acquisitions are consummated on different dates and the PTI Acquisition is not
the First Acquisition and is not consummated on or before the Equity
Contribution Date, then, subject to the provisions of Section 2.10(g) (iii), the
Borrower will obtain from the Sponsor the Additional Equity Contribution.
SECTION 5.18. Second Acquisition. If the Acquisitions are
consummated on different dates, then the Borrower will effect the Second
Acquisition as soon as reasonably practicable after the Initial Closing Date and
on the same date as the second drawing under the Term Facilities.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and the principal
of and interest on each Loan and all fees payable hereunder have been paid in
full and all Letters of Credit have expired or terminated and all LC
Disbursements shall have been reimbursed, each of Holdings and the Borrower
covenants and agrees with the Lenders that:
SECTION 6.01. Indebtedness: Certain Equity Securities. (a) Holdings
and the Borrower will not, and will not permit any Subsidiary to, create, incur,
assume or permit to exist any Indebtedness, except:
(i) Indebtedness created under the Loan Documents;
(ii) the Senior Subordinated Notes in an aggregate principal amount
not to exceed $200,000,000 and the Holdings Discount Debentures in an
aggregate principal amount at maturity not to exceed $49,000,000;
(iii) Indebtedness existing on the date hereof and set forth in
Schedule 6.01 and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof
or result in an earlier maturity date or decreased weighted average life
thereof;
(iv) Indebtedness of the Borrower to any Wholly-Owned Subsidiary and
of any Wholly-Owned Subsidiary
104
(other than a License Subsidiary) to the Borrower or any other
Wholly-Owned Subsidiary, provided that Indebtedness of any Wholly-Owned
Subsidiary that is not a Loan Party to the Borrower or any Wholly-Owned
Subsidiary Loan Party shall be subject to Section 6.04;
(v) Guarantees by the Borrower of Indebtedness of any Subsidiary and
by any Subsidiary of Indebtedness of the Borrower or any other Subsidiary,
provided that Guarantees by the Borrower or any Subsidiary Loan Party of
Indebtedness of any Subsidiary that is not a Loan Party shall be subject
to Section 6.04;
(vi) Indebtedness of the Borrower or any Subsidiary (other than a
License Subsidiary) incurred to finance the acquisition, construction or
improvement of any fixed or capital assets, including Capital Lease
Obligations and any Indebtedness assumed in connection with the
acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, provided that such Indebtedness is
incurred prior to or within 90 days after such acquisition or the
completion of such construction or improvement, and extensions, renewals
and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof provided that the aggregate principal
amount of Indebtedness permitted by this clause (vi) shall not exceed
$20,000,000 at any time outstanding;
(vii) Indebtedness of any Person that becomes a Subsidiary after the
date hereof, provided that (A) such Indebtedness exists at the time such
Person becomes a Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Subsidiary and (B) the aggregate
principal amount of Indebtedness permitted by this clause (vii) shall not
exceed $10,000,000 at any time outstanding;
(viii) other unsecured Indebtedness of the Borrower or any
Subsidiary (other than a License Subsidiary) in an aggregate principal
amount not exceeding $5,000,000 at any time outstanding;
(ix) Indebtedness in respect of Hedging Agreements permitted by
Section 6.07; and
(x) Indebtedness incurred by the Borrower or any of the Subsidiaries
constituting reimbursement obligations with respect to letters of credit
issued in the ordinary course of business, including letters of
105
credit in respect of workers' compensation claims or self-insurance.
(b) Holdings will not create, incur, assume or permit to exist any
Indebtedness except (i) the Holdings Discount Debentures, (ii) the Guarantees of
the Senior Subordinated Notes and (iii) Indebtedness created under the Loan
Documents.
(c) Neither Holdings nor the Borrower will, nor will they permit any
Subsidiary to, issue any preferred stock or other preferred Equity Interests.
SECTION 6.02. Liens. (a) Holdings and the Borrower will not, and
will not permit any Subsidiary to, create, incur, assume or permit to exist any
Lien on any property or asset now owned or hereafter acquired by it, or assign
or sell any income or revenues (including accounts receivable) or rights in
respect of any thereof, except:
(i) Liens created under the Loan Documents;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of the Borrower or any
Subsidiary existing on the date hereof and set forth in Schedule 6.02,
provided that (i) such Lien shall not apply to any other property or asset
of Holdings, the Borrower or any Subsidiary and (ii) such Lien shall
secure only those obligations that it secures on the date hereof and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(iv) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary (other than a
License Subsidiary) after the date hereof prior to the time such Person
becomes a Subsidiary, provided that (A) such Lien is not created in
contemplation of or in connection with such acquisition or such Person
becoming a Subsidiary, as the case may be, (B) such Lien shall not apply
to any other property or assets of the Borrower or any Subsidiary and (C)
such Lien shall secure only those obligations that it secures on the date
of such acquisition or the date such Person becomes a Subsidiary, as the
case may be and extensions, renewals and replacements thereof that do not
increase the outstanding principal amount thereof; and
106
(v) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Subsidiary, (other than a License
Subsidiary), provided that (A) such security interests secure Indebtedness
permitted by clause (vi) of Section 6.01(a), (B) such security interests
and the Indebtedness secured thereby are incurred prior to or within 90
days after such acquisition or the completion of such construction or
improvement, (C) the Indebtedness secured thereby does not exceed 80% of
the cost of acquiring, constructing or improving such fixed or capital
assets and (D) such security interests shall not apply to any other
property or assets of the Borrower or any Subsidiary;
(b) Holdings will not create, incur, assume or permit to exist any
Lien on any property or asset now owned or hereafter acquired by it, or assign
or sell any income or revenues (including accounts receivable) or rights in
respect thereof, except Liens created under the Pledge Agreement and Permitted
Encumbrances.
SECTION 6.03. Fundamental Changes. (a) Neither Holdings nor the
Borrower will, nor will they permit any Subsidiary to, merge into or consolidate
with any other Person, or permit any other Person to merge into or consolidate
with it, or liquidate or dissolve, except that, if at the time thereof and
immediately after giving effect thereto no Default shall have occurred and be
continuing (i) any Subsidiary (other than a License Subsidiary) may merge into
the Borrower in a transaction in which the Borrower is the surviving
corporation, (ii) any Person (other than a License Subsidiary) may merge with or
into or consolidate with any Subsidiary (other than a License Subsidiary) in a
transaction in which the surviving entity the surviving entity is a Subsidiary
and (if any party to such merger is a Subsidiary Loan Party) the surviving
entity is a Subsidiary Loan Party, (iii) any Subsidiary may merge into or
consolidate with any other Person or permit any other Person to merge into or
consolidate with it in any sale or other disposition permitted under Section
6.05., (iv) any Subsidiary (other than a License Subsidiary or other Subsidiary
Loan Party) may liquidate or dissolve if the Borrower determines in good faith
that such liquidation or dissolution is in the best interests of the Borrower
and is not materially disadvantageous to the Lenders and (v) the Borrower may
merge with an Affiliate incorporated solely for the purpose of reincorporating
the Borrower in another jurisdiction, provided that Holdings pledges the stock
of the surviving entity to the Collateral Agent as security for the Obligations
and, in connection with such merger, Holdings and its subsidiaries execute such
other documents as are
107
reasonably requested by the Administrative Agent to the effect the purposes of
this Agreement and the other Loan Documents, provided further that any such
merger or consolidation involving a Person that is not a Wholly Owned Subsidiary
immediately prior to such merger or consolidation shall not be permitted unless
also permitted by Sections 6.04 and 6.08.
(b) The Borrower will not, and will not permit any of the
Subsidiaries to, engage to any material extent in any business other than
businesses of the type conducted by the Borrower and the Subsidiaries on the
date of execution of this Agreement and businesses reasonably related thereto.
(c) Holdings will not engage in any business or activity other than
the ownership of all the outstanding shares of capital stock of the Borrower,
the issuance of the Holdings Discount Debentures and activities incidental
thereto, including rental payments, computer services, professional and
consultant services, investment services, printing, travel and other
miscellaneous services. Holdings will not own or acquire any assets (other than
shares of capital stock of the Borrower, cash and Permitted Investments) or
incur any liabilities (other than liabilities under the Loan Documents,
liabilities imposed by law, including tax liabilities, liabilities under the
Holdings Discount Debentures and other liabilities incidental to its existence
and permitted business and activities).
(d) No License Subsidiary will engage in any business or activity
other than holding the applicable Operating License and activities incidental
thereto.
(e) No License Subsidiary will sell, transfer, lease or otherwise
dispose of any Operating License or any Authorization.
SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions. The Borrower will not, and will not permit any of the Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a wholly owned Subsidiary prior to such merger) any Equity
Interests in or evidences of indebtedness or other securities (including any
option, warrant or other right to acquire any of the foregoing) of, make or
permit to exist any loans or advances to, Guarantee any obligations of, or make
or permit to exist any investment or any other
108
interest in, any other Person, or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person
constituting a business unit, except:
(a) the Acquisitions;
(b) Permitted Investments;
(c) Investments permitted pursuant to Section 2.11(c);
(d) investments existing on the date hereof and set forth on
Schedule 6.04;
(e) investments by the Borrower and the Subsidiaries in Equity
Interests in their respective Subsidiaries, provided that (i) any such
Equity Interests held by a Loan Party shall be pledged pursuant to the
Pledge Agreement (subject to the limitations applicable to common stock of
a Foreign Subsidiary referred to in Section 5.12) and (ii) the aggregate
amount of investments by Loan Partes in, and loans and advances by Loan
Parties to, and Guarantees by Loan Parties of Indebtedness of,
Subsidiaries that are not Loan Parties (including all such investments,
loans, advances and Guarantees existing on the Start Date) shall not
exceed $25,000,000 (based on cost and net of any cash distributed by such
Subsidiaries that are not Loan Parties to Loan Parties that represent a
return of paid-in capital or repayment of principal) at any time
outstanding;
(f) loans or advances made by the Borrower to any Subsidiary and
made by any Subsidiary to the Borrower or any other Subsidiary, provided
that (i) any such loans and advances made by a Loan Party shall be
evidenced by a promissory note pledged pursuant to the Pledge Agreement
and (ii) the amount of such loans and advances made by Loan Parties to
Subsidiaries that are not Loan Parties shall be subject to the limitation
set forth in clause (d) above;
(g) Guarantees constituting Indebtedness permitted by Section 6.01,
provided that (i) neither Holdings nor any Subsidiary shall Guarantee the
Senior Subordinated Notes unless (A) Holdings or such Subsidiary, as
applicable, also has Guaranteed the Obligations pursuant to a Guarantee
Agreement, (B) such Guarantee of the Senior Subordinated Notes is
subordinated to such Guarantee of the Obligations on terms no less
110
(o) other investments in an aggregate amount not to exceed
$5,000,000.
SECTION 6.05. Asset Sales. The Borrower will not, and will not
permit any of the Subsidiaries to, sell, transfer, lease or otherwise dispose of
any asset, including any Equity Interest owned by it, nor will the Borrower
permit any of the Subsidiaries to issue any additional Equity Interest in such
Subsidiary, except:
(a) sales of inventory, used or surplus equipment and Permitted
Investments in the ordinary course of business;
(b) sales, transfers and dispositions to the Borrower or a
Wholly-Owned Subsidiary, provided that any such sales, transfers or
dispositions involving a Subsidiary that is not a Loan Party shall be made
in compliance with Section 6.09; and
(c) sales, transfers and other dispositions of assets (other than
Equity Interests in a Subsidiary) that are not permitted by any other
clause of this Section, provided that the aggregate fair market value of
all assets sold, transferred or otherwise disposed of in reliance upon
this clause (c) shall not exceed $15,000,000 during any fiscal year of the
Borrower or $50,000,000 in the aggregate during the term of this Agreement
provided however that assets with an aggregate book value of less than
$100,000 sold, transferred or otherwise disposed of in a single
transaction or a series of related transactions shall not be included in
the determination of the aggregate fair market value of assets sold,
transferred or otherwise disposed of in reliance upon this clause (c);
provided that all sales, transfers, leases and other dispositions permitted
hereby (other than those permitted by clause (b) above) shall be made for fair
value and (other than those permitted by clause (b) above) shall be made for at
least 50% cash consideration.
SECTION 6.06. Sale and Leaseback Transactions. The Borrower will
not, and will not permit any of the Subsidiaries to, enter into any arrangement,
directly or indirectly, whereby it shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereinafter
acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property
sold or transferred, except for any such sale of any
111
fixed or capital assets that is made for cash consideration in an amount not
less than the cost of such fixed or capital asset and is consummated within 90
days after the Borrower or such Subsidiary acquires or completes the
construction of such fixed or capital asset.
SECTION 6.07. Hedging Agreements. The Borrower will not, and will
not permit any of the Subsidiaries to, enter into any Hedging Agreement, other
than (a) Hedging Agreements required by Section 5.14 and (b) Hedging Agreements
entered into in the ordinary course of business to hedge or mitigate risks to
which the Borrower or any Subsidiary is exposed in the conduct of its business
or the management of its liabilities.
SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness.
(a) Neither Holdings nor the Borrower will, nor will they permit any Subsidiary
to, declare or make, or agree to pay or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except (i) Holdings may declare and pay dividends with respect to its capital
stock payable solely in additional shares of its common stock, (ii) Subsidiaries
may declare and pay dividends ratably with respect to their capital stock, (iii)
the Borrower may pay dividends to Holdings in amounts equal to amounts expended
by Holdings to repurchase or otherwise acquire shares of, or options to purchase
shares of, common stock of Holdings from employees, former employees,
consultants, former consultants, directors or former directors of Holdings, the
Borrower or any Subsidiary (or permitted transferees of such employees, former
employees, consultants, former consultants, directors or former directors),
pursuant to the terms of agreements (including employment agreements) or plans
(or amendments thereto) approved by the Board of Directors of Holdings under
which such individuals purchase or sell, or are granted the option to purchase
or sell, shares of such common stock of Holdings, provided, however, that the
aggregate amount paid to Holdings pursuant to this clause (iii) shall not exceed
in any calender year the sum of (x) $5,000,000 plus (y) the Net Proceeds
received since the date of this Agreement and not previously credited to any
repurchase or other acquisition of such shares or options to purchase shares of
common stock pursuant to this clause (iii) received by Holdings and contributed
to the Borrower from the sale of Equity Interests to employees, consultants and
directors of Holdings, the Borrower or any Subsidiary; (iv) the Borrower may pay
dividends to Holdings at such times and in such amounts equal to the amounts
required for Holdings to pay taxes, franchise fees and other fees required to
maintain its corporate existence and
112
provide for other operating costs of up to $7,500,000 during any fiscal year
(other than liabilities in respect of the Holdings Discount Debentures); (v) the
Borrower may pay dividends to Holdings in amounts equal to amounts necessary for
Holdings to make loans or advances to employees in the ordinary course of
business in accordance with past practices of the Borrower, but in any event not
to exceed, when aggregated with amounts loaned or advanced under Section
6.04(j), $5,000,000 in the aggregate outstanding at any one time; (vi) any
purchase, repurchase, retirement, defeasance or other acquisition or retirement
for value of Equity Interests of Holdings made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Equity Interests of Holdings
(other than Disqualified Stock and other than Equity Interests issued or sold to
the Borrower or a Subsidiary or an employee stock ownership plan or other trust
established by the Borrower or any of the Subsidiaries); (vii) the Borrower may
pay dividends to Holdings as shall be necessary to permit Holdings to, and
Holdings may, effect the Equity Clawback in accordance with Section 2.10(g), and
(viii) the Borrower may during any fiscal year, provided that no Default or
Event of Default has occurred and is continuing or will occur as a result of
such payment and to the extent permitted by the Subordinated Debt Documents as
in effect on the date hereof, pay dividends to Holdings when and to the extent
necessary to fund payments of interest accrued during such year on the Holdings
Discount Debentures.
(b) Neither Holdings nor the Borrower will, nor will they permit any
Subsidiary to, make or agree to pay or make, directly or indirectly, any payment
or other distribution (whether in cash, securities or other property) of or in
respect of principal of or interest on any Indebtedness, or any payment or other
distribution (whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancelation or termination of any Indebtedness, except:
(i) payment of Indebtedness created under the Loan Documents;
(ii) payment of regularly scheduled interest and principal payments
as and when due in respect of any Indebtedness, other than payments in
respect of the Senior Subordinated Notes prohibited by the subordination
provisions thereof;
(iii) refinancings of Indebtedness to the extent permitted by
Section 6.01;
113
(iv) payment of secured Indebtedness that becomes due as a result of
the voluntary sale or transfer of the property or assets securing such
Indebtedness;
(v) payment of indebtedness of the Alaska Entities existing on (i)
the Closing Date, if the Acquisitions are consummated simultaneously, (ii)
the Initial Closing Date, if the Acquisitions are consummated on different
dates and the PTI Acquisition is the First Acquisition or (iii) the Second
Closing Date, if the Acquisitions are consummated on different dates and
the PTI Acquisition is the Second Acquisition.
SECTION 6.09. Transactions with Affiliates. Neither Holdings nor the
Borrower will, nor will they permit any Subsidiary to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any
of its Affiliates, except (a) transactions in the ordinary course of business
that do not involve Holdings and are at prices and on terms and conditions not
less favorable to the Borrower or such Subsidiary than could be obtained on an
arm's-length basis from unrelated third parties, (b) transactions between or
among the Borrower and the Subsidiary Loan Parties not involving any other
Affiliate (c) any Restricted Payment permitted by Section 6.08, (d) any issuance
by Holdings of Securities or by the Borrower of debt securities, or other
payments, awards or grants in cash, securities (other than, in respect of the
Borrower, Equity Interests) or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans approved by the
Board of Directors of the Borrower, (e) the grant of stock options or similar
rights in respect of Equity Interests in Holdings to employees and directors of
the Borrower pursuant to plans approved by the Board of Directors of the
Borrower, (g) customary indemnification and insurance arrangements in favor of
officers, directors, employees and consultants of Holdings, the Borrower or any
Subsidiary, (h) the payment of management fees by the Borrower or any Subsidiary
of up to an aggregate amount per annum equal to 1% of the Consolidated EBITDA of
Holdings for the fiscal year most recently ended, provided that no Default or
Event of Default has occurred and is continuing, (i) the existence of, or the
performance by Holdings, the Borrower or any Subsidiary of the obligations under
the terms of, any stockholders agreements (including any registration rights
agreement or purchase agreement related thereto) to which it is a party as of
the earlier of the Closing Date and the Initial Closing Date, which agreements
are listed on Schedule 6.O8(h), as such agreement may be amended on terms
114
reasonably satisfactory to the Administrative Agent from time to time pursuant
to the terms thereof, provided, however, that the terms of any such amendment
are no less favorable to the Lenders than the terms of any such agreements in
effect as of the earlier of the Closing Date and the Initial Closing Date,
respectively, and (j) the issuance of Equity Interests (other than Disqualified
Stock) of Holdings for cash to Fox ▇▇▇▇▇ or senior management.
SECTION 6.10. Restrictive Agreements. Neither Holdings nor the
Borrower will, nor will they permit any Subsidiary to, directly or indirectly,
enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of Holdings,
the Borrower or any Subsidiary to create, incur or permit to exist any Lien upon
any of its property or assets or (b) the ability of any Subsidiary to pay
dividends or other distributions with respect to any shares of its capital stock
or to make or repay loans or advances to the Borrower or any other Subsidiary or
to Guarantee Indebtedness of the Borrower or any other Subsidiary, provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by any Loan Document or Subordinated Debt Document, (ii) the foregoing shall
not apply to restrictions and conditions existing on the date hereof identified
on Schedule 6.10 (but shall apply to any extension or renewal of, or any
amendment or modification expanding the scope of, any such restriction or
condition), (iii) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Subsidiary that is to be sold and such sale is permitted hereunder, (iv) clause
(a) of the foregoing shall not apply to restrictions or conditions imposed by
any agreement relating to secured Indebtedness permitted by this Agreement if
such restrictions or conditions apply only to the property or assets securing
such Indebtedness, (v) clause (a) of the foregoing shall not apply to customary
provisions in leases and other contracts restricting the assignment thereof (vi)
clause (a) of the foregoing shall not apply to restrictions on cash or other
deposits imposed by customers under contracts entered into in the ordinary
course of business on the parties to such contracts, and (vii) clause (a) of the
foregoing shall not apply to any encumbrance or restriction on the assets of any
joint venture that is (A) contained in any joint venture agreement or other
similar agreement with respect to such joint venture that was entered into in
the ordinary course of business and (B) customary for such types of agreements.
115
SECTION 6.11. Amendment of Material Documents. Neither Holdings nor
the Borrower will, nor will they permit any Subsidiary to, amend, modify or
waive any of its rights under (a) any Subordinated Debt Document, (b) its
certificate of incorporation, by-laws or other organizational documents, (c) the
Holdings Discount Indenture or (d) any other material document or agreement in
each case in any manner that would impair in any material respect the value of
the interests or rights of the Borrower thereunder or that would impair in any
material respect the rights or interests of any Agent or any Lender.
SECTION 6.12. Interest Coverage Ratio. The Borrower will not permit
the ratio (the "Interest Coverage Ratio") of Adjusted Consolidated EBITDA to
Consolidated Cash Interest Expense for (a) the fiscal quarter period ended as of
September 30, 1999, to be less than (i) 1.75 to 1.00, if the Closing Date or the
Second Closing Date has occurred, (ii) 1.50 to 1.00, if neither the Closing Date
nor the Second Closing Date has occurred and the PTI Acquisition is the First
Acquisition or (iii) 2.25 to 1.00, if neither the Closing Date nor the Second
Closing Date has occurred and the ATU Acquisition is the First Acquisition, (b)
the two fiscal quarter period ended as of December 31, 1999 to be less than (i)
1.75 to 1.00 if the Closing Date or the Second Closing Date has occurred, (ii)
1.50 to 1.00, if neither the Closing Date nor the Second Closing Date has
occurred and the PTI Acquisition is the First Acquisition or (iii) 2.25 to 1.00,
if neither the Closing Date nor the Second Closing Date has occurred and the ATU
Acquisition is the First Acquisition, (c) the three fiscal quarter period ended
as of March 31, 2000, to be less than (i) 1.75 to 1.00, if the Closing Date or
the Second Closing Date has occurred, (ii) 1.50 to 1.00, if neither the Closing
Date nor the Second Closing Date has occurred and the PTI Acquisition is the
First Acquisition or (iii) 2.25 to 1.00, if neither the Closing Date nor the
Second Closing Date has occurred and the ATU Acquisition is the First
Acquisition, or (d) any Test Period ending on the last day of any fiscal quarter
included in any period (or ending on any date) set forth below (i) if the
Closing Date or the Second Closing Date has occurred, on the table under the
heading "Combined Table" or (ii) if neither the Closing Date nor the Second
Closing Date has occurred and the PTI Acquisition is the First Acquisition, on
the table under the heading "PTI Acquisition" or (iii) if neither the Closing
Date nor the Second Closing Date has occurred and the ATU Acquisition is the
First
116
Acquisition, on the table under the heading "ATU Acquisition", to be less than
the ratio set forth opposite such period or date:
Combined Table
Period: Ratio:
------- ------
April 1, 2000 to 1.75 to 1.00
June 30, 2000
July 1, 2000 to 1.80 to 1.00
September 30, 2001
October 1, 2001 to 1.85 to 1.00
March 31, 2002
April 1, 2002 to 1.95 to 1.00
December 31, 2002
January 1, 2003 to 2.05 to 1.00
September 30, 2003
October 1, 2003 to 2.15 to 1.00
September 30, 2004
October 1, 2004 to 2.25 to 1.00
September 30, 2005
October 1, 2005 to 2.35 to 1.00
September 30, 2006
October 1, 2006 to 2.45 to 1.00
September 30, 2007
October 1, 2007 and 2.70 to 1.00
thereafter
117
PTI Acquisition
Period: Ratio:
------- ------
April 1, 2000 to 1.50 to 1.00
September 30, 2000
October 1, 2000 to 1.60 to 1.00
September 30, 2001
October 1, 2001 to 1.65 to 1.00
September 30, 2002
October 1, 2002 to 1.75 to 1.00
September 30, 2003
October 1, 2003 to 1.85 to 1.00
September 30, 2004
October 1, 2004 to 1.95 to 1.00
September 30, 2005
October 1, 2005 to 2.05 to 1.00
September 30, 2006
October 1, 2006 and 2.20 to 1.00
thereafter
ATU Acquisition
Period: Ratio:
------- ------
April 1, 2000 to 2.25 to 1.00
September 30, 2000
October 1, 2000 to 2.35 to 1.00
September 30, 2001
October 1, 2001 to 2.45 to 1.00
September 30, 2002
October 1, 2002 to 2.65 to 1.00
September 30, 2003
October 1, 2003 to 2.85 to 1.00
September 30, 2004
October 1, 2004 to 3.05 to 1.00
September 30, 2005
October 1, 2005 to 3.25 to 1.00
September 30, 2006
118
Period: Ratio:
------- ------
October 1, 2006 and 3.45 to 1.00
thereafter
SECTION 6.13. Leverage Ratio. The Borrower will not permit the
Adjusted Leverage Ratio as of the last day of any fiscal quarter included in any
period (or ending on any date) set forth below (i) if the Closing Date or the
Second Closing Date has occurred, on the table under the heading "Combined
Table" or (ii) if neither the Closing Date nor the Second Closing Date has
occurred and the PTI Acquisition is the First Acquisition, on the table under
the heading "PTI Acquisition" or (iii) if neither the Closing Date nor the
Second Closing Date has occurred and the ATU Acquisition is the First
Acquisition, on the table under the heading "ATU Acquisition", to be more than
the ratio set forth opposite such period or date, provided that for purposes of
this Section 6.13, Adjusted Consolidated EBITDA for the four quarter period
ending on (x) September 30, 1999, shall be deemed to be Adjusted Consolidated
EBITDA for the fiscal quarter ending on such date, multiplied by four, (y)
December 31, 1999, shall be deemed to be Adjusted Consolidated EBITDA for the
two fiscal quarter period ending on December 31, 1999, multiplied by two and (z)
March 31, 2000, shall be deemed to be Adjusted Consolidated EBITDA for the three
fiscal quarter period ending on March 31, 2000, multiplied by 4/3:
Combined Table
Period: Ratio:
------- ------
Closing Date to 6.75 to 1.00
June 30, 2000
July 1, 2000 to 6.50 to 1.00
June 30, 2001
July 1, 2001 to 6.00 to 1.00
March 31, 2002
April 1, 2002 to 5.75 to 1.00
December 31, 2002
January 1, 2003 to 5.50 to 1.00
September 30, 2003
October 1, 2003 to 5.20 to 1.00
September 30, 2004
119
Period: Ratio:
------- ------
October 1, 2004 to 5.25 to 1.00
September 30, 2005
October 1, 2005 to 5.00 to 1.00
September 30, 2006
October 1, 2006 and 4.75 to 1.00
thereafter
PTI Acquisition
Period: Ratio:
------- ------
First Closing Date to 7.50 to 1.00
September 30, 2000
October 1, 2000 to 7.25 to 1.00
September 30, 2001
October 1, 2001 to 7.00 to 1.00
September 30, 2002
October 1, 2002 to 6.75 to 1.00
September 30, 2003
October 1, 2003 to 6.50 to 1.00
September 30, 2004
October 1, 2004 to 6.25 to 1.00
September 30, 2005
October 1, 2005 to 6.00 to 1.00
September 30, 2006
October 1, 2006 and 5.50 to 1.00
thereafter
ATU Acquisition
Period: Ratio:
------- ------
First Closing Date to 5.50 to 1.00
September 30, 2000
October 1, 2000 to 5.25 to 1.00
September 30, 2001
October 1, 2001 to 5.00 to 1.00
September 30, 2002
120
Period: Ratio:
------- ------
October 1, 2002 to 4.75 to 1.00
September 30, 2003
October 1, 2003 to 4.50 to 1.00
September 30, 2004
October 1, 2004 to 4.25 to 1.00
September 30, 2005
October 1, 2005 to 4.00 to 1.00
September 30, 2006
October 1, 2006 and 3.75 to 1.00
thereafter
SECTION 6.14. Capital Expenditures. (a) Holdings and the Borrower
will not, and will not permit any of the Subsidiaries to, make any Capital
Expenditures that would cause the aggregate amount of such Capital Expenditures
made by the Borrower and the Subsidiaries in any fiscal year of the Borrower (i)
(A) ending on or before December 31, 1999, to exceed $65,000,000 and (B) ending
thereafter to exceed $70,000,000 if both Acquisitions are consummated by
December 31, 1999, (ii) to exceed $30,000,000 in any fiscal year if the ATU
Acquisition is not consummated by December 31, 1999, or (iii) to exceed (A)
$35,000,000 in any fiscal year ending on or before December 31, 2001 and (B)
$37,500,000 in any fiscal year ending thereafter if the PTI Acquisition is not
consummated by December 31, 1999, provided that (x) expenditures made in
connection with the replacement, substitution or restoration of assets (i) to
the extent financed from insurance proceeds paid on account of the loss of or
damage to the assets being replaced or restored or (ii) with awards of
compensation arising from the taking by eminent domain or condemnation of the
assets being replaced, (y) the purchase price of equipment that is purchased
simultaneously with the trade-in of existing equipment to the extent that the
gross amount of such purchase price is reduced by the credit granted by the
seller of such equipment for the equipment being traded in at such time and (z)
the purchase price of plant, property or equipment made within one year of the
sale of any asset to the extent purchased for an aggregate amount not in excess
of the amount of the net cash proceeds of such sale shall not be included in the
calculation of Capital Expenditures pursuant to this Section 6.14.
(b) Notwithstanding the foregoing, the Borrower may in any fiscal
year, upon written notice to the Admin-
121
istrative Agent, increase the amount of Capital Expenditures permitted to be
made during such fiscal year pursuant to this Section 6.14 by an amount equal to
the lesser of (i) the total unused amount of Capital Expenditures permitted to
be made pursuant to this Section 6.14 for the immediately preceding fiscal year
(minus the amount of any unused Capital Expenditures permitted to be made
pursuant to this Section 6.14 that were carried forward to such preceding fiscal
year pursuant to this paragraph (b)) and (ii) 50% of the amount of Capital
Expenditures permitted to be made pursuant to this Section 6.14 for the
immediately preceding fiscal year (minus the amount of any unused Capital
Expenditures permitted to be made pursuant to this Section 6.14 that were
carried forward to such preceding fiscal year pursuant to this paragraph (b)).
SECTION 6.15. Fiscal Year. Holdings and the Borrower will not, and
will not permit the Subsidiaries to, change the financial reporting convention
by which Holdings, the Borrower and the Subsidiaries determine the dates on
which their fiscal years and fiscal quarters will end.
ARTICLE VII
Events of Default
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement or any other Loan Document,
when and as the same shall become due and payable, and such failure shall
continue unremedied for a period of three Business Days;
(c) any representation or warranty made or deemed made by or on
behalf of Holdings, the Borrower or any Subsidiary in or in connection
with any Loan Document or any amendment or modification thereof or waiver
thereunder, or in any report, certificate, financial statement or other
document furnished pursuant to or in connection with any Loan Document or
any amendment or
122
modification thereof or waiver thereunder, shall prove to have been
incorrect in any material respect when made or deemed made;
(d) Holdings or the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in Section 5.02, 5.04 (with
respect to the existence of Holdings or the Borrower) 5.13(c), 5.15 or
5.16 or in Article VI;
(e) any Loan Party shall fail to observe or perform any covenant,
condition or agreement contained in any Loan Document (other than those
specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof
from the Administrative Agent to the Borrower (which notice will be given
at the request of any Lender);
(f) Holdings, the Borrower or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount) in
respect of any Material Indebtedness, when and as the same shall become
due and payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables
or permits (with or without the giving of notice, the lapse of time or
both) the holder or holders of any Material Indebtedness or any trustee or
agent on its or their behalf to cause any Material Indebtedness to become
due, or to require the prepayment, repurchase, redemption or defeasance
thereof, prior to its scheduled maturity, provided that this clause (g)
shall not apply to secured Indebtedness that becomes due as a result of
the voluntary sale or transfer of the property or assets securing such
Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of Holdings, the Borrower or any Subsidiary or its
debts, or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for Holdings, the
Borrower or any Subsidiary or for a substantial part of its assets, and,
in any such case, such proceeding or petition
123
shall continue undismissed for 60 days or an order or decree approving or
ordering any of the foregoing shall be entered;
(i) Holdings, the Borrower or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a timely
and appropriate manner, any proceeding or petition described in clause (h)
of this Article, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for Holdings, the Borrower or any Subsidiary or for a substantial
part of its assets, (iv) file an answer admitting the material allegations
of a petition filed against it in any such proceeding, (v) make a general
assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;
(j) Holdings, the Borrower or any Subsidiary shall become unable,
admit in writing its inability or fail generally to pay its debts as they
become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $5,000,000 (after giving effect to insurance payments,
if any) shall be rendered against Holdings, the Borrower, any Subsidiary
or any combination thereof and the same shall remain undischarged for a
period of 30 consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment
creditor to attach or levy upon any assets of Holdings, the Borrower or
any Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events for
which liability of the Borrower or the Subsidiaries is reasonably expected
to occur, could reasonably be expected to result in liability of the
Borrower and the Subsidiaries in an aggregate amount exceeding (i)
$5,000,000 in any year or (ii) $15,000,000 for all periods;
(m) (i) any Lien purported to be created under any Security Document
shall cease to be, or shall be asserted by any Loan Party not to be, a
valid and
124
perfected Lien on any Collateral, having a value in excess of $10,000,000,
with the priority required by the applicable Security Document, except (A)
as a result of the sale or other disposition of the applicable Collateral
in a transaction permitted under the Loan Documents or (B) as a result of
the Administrative Agent's failure to maintain possession of any stock
certificates, promissory notes or other instruments delivered to it under
the Security Agreement or (ii) the Obligations of the Borrower, or the
obligations of Holdings or any Subsidiaries pursuant to a Guarantee
Agreement shall cease to constitute senior indebtedness under the
subordination provisions of any document or instrument evidencing any
permitted subordinated Indebtedness or such subordination provisions shall
be invalidated or otherwise cease to be legal, valid and binding
obligations of the parties thereto, enforceable in accordance with their
terms;
(n) a Change in Control shall occur; or
(o) any of the Operating Licenses or Authorizations shall have been
(i) revoked, rescinded, suspended, modified in an adverse manner or not
renewed in the ordinary course for a full term or (ii) subject to any
decision by a Governmental Authority that designates a hearing with
respect to any applications for renewal of any of the Operating Licenses
or Authorizations or that could result in the Government Authority taking
any of the actions described in clause (i), above, and such decision or
such revocation, rescission, suspension, modification or nonrenewal (i)
has, or could reasonably be expected to have, a Material Adverse Effect,
or (ii) adversely affects the legal or character qualifications of
Holdings, the Borrower or any of the Subsidiaries to hold any of the
Operating Licenses or Authorizations;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and (ii)
declare the Loans then outstanding to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may thereafter
be declared to be due and payable), and thereupon the principal
125
of the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower; and
in case of any event with respect to the Borrower described in clause (h) or (i)
of this Article, the Commitments shall automatically terminate and the principal
of the Loans then outstanding, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
Each of the Lenders and the Issuing Bank hereby irrevocably appoints
the Administrative Agent as its agent and authorizes the Administrative Agent to
take such actions on its behalf and to exercise such powers as are delegated to
the Administrative Agent by the terms of the Loan Documents, together with such
actions and powers as are reasonably incidental thereto. For purposes of this
Article VIII, all references to the Administrative Agent are deemed to include
the Collateral Agent.
The bank serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and such
bank and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with Holdings, the Borrower or any Subsidiary or
any Affiliate of any of the foregoing as if it were not the Administrative Agent
hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth in the Loan Documents. Without limiting the
generality of the foregoing, (a) the Administrative Agent shall not be subject
to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) the Administrative Agent shall not have any duty
to take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated by the Loan Documents
that the Administrative Agent is required to exercise in writing by the Required
Lenders (or such
126
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth in the Loan Documents, the Administrative Agent shall not have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to Holdings, the Borrower or any of the Subsidiaries that is
communicated to or obtained by the bank serving as Administrative Agent or any
of its Affiliates in any capacity. The Administrative Agent shall not be liable
for any action taken or not taken by it with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 9.02) or in the
absence of its own gross negligence or wilful misconduct. The Administrative
Agent shall not be deemed to have knowledge of any Default unless and until
written notice thereof is given to the Administrative Agent by Holdings, the
Borrower or a Lender, and the Administrative Agent shall not be responsible for
or have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered thereunder or in
connection therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan
Document, (iv) the validity, enforceability, effectiveness or genuineness of any
Loan Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall
not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to be
genuine and to have been signed or sent by the proper Person. The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any
liability for relying thereon. The Administrative Agent may consult with legal
counsel (who may be counsel for the Borrower), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.
127
The Administrative Agent may perform any of and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders, the Issuing Bank and the Borrower.
Upon any such resignation, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent which
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor, such successor shall succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. After the
Administrative Agent's resignation hereunder, the provisions of this Article and
Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was
acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from
128
time to time deem appropriate, continue to make its own decisions in taking or
not taking action under or based upon this Agreement, any other Loan Document or
related agreement or any document furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to Holdings or the Borrower, to it at ▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, Attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (Fax No.
(▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Administrative Agent, to The Chase Manhattan Bank,
Loan and Agency Services Group, One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (212)
552-5700), with a copy to The Chase Manhattan Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇ ▇▇▇▇▇▇▇▇▇ (Telecopy No. (212) 270-
1063);
(c) if to the Issuing Bank, to it at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (Telecopy No. (212)
270-3090);
(d) if to the Swingline Lender, to it at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No.
(▇▇▇) ▇▇▇-▇▇▇▇); and
(e) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
129
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent, the Issuing Bank or any Lender in exercising any right or
power hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Administrative Agent, the Issuing
Bank and the Lenders hereunder and under the other Loan Documents are cumulative
and are not exclusive of any rights or remedies that they would otherwise have.
No waiver of any provision of any Loan Document or consent to any departure by
any Loan Party therefrom shall in any event be effective unless the same shall
be permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or the
Issuing Bank may have had notice or knowledge of such Default at the time.
(b) Neither this Agreement nor any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except, in the
case of this Agreement, pursuant to an agreement or agreements in writing
entered into by Holdings, the Borrower and the Required Lenders or, in the case
of any other Loan Document, pursuant to an agreement or agreements in writing
entered into by the Administrative Agent and the Loan Party or Loan Parties that
are parties thereto, in each case with the consent of the Required Lenders,
provided that no such agreement shall (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal amount of
any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce
any fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the date of any scheduled payment of the principal
amount of any Loan or LC Disbursement, or any interest thereon, or any fees
payable hereunder, or reduce the amount of, waive or excuse any such scheduled
payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender affected thereby, (iv) change Section 2.18(b)
or (c) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) change any of the
provisions of this Section or the definition of "Required Lenders" or any other
provision of any Loan Document specifying the number or percentage of
130
Lenders (or Lenders of any Class) required to waive, amend or modify any rights
thereunder or make any determination or grant any consent thereunder, without
the written consent of each Lender (or each Lender of such Class, as the case
may be), (vi) release Holdings or any material Subsidiary Loan Party from its
Guarantee under the applicable Guarantee Agreement (except as expressly provided
in such Guarantee Agreement), or limit its liability in respect of such
Guarantee, without the written consent of each Lender, (vii) release all or
substantially all of the Collateral from the Liens of the Security Documents,
without the written consent of each Lender (except as expressly provided in such
Security Documents), (viii) change any provisions of any Loan Document in a
manner that by its terms adversely affects the rights in respect of payments due
to Lenders holding Loans of any Class differently than those holding Loans of
any other Class, without the written consent of Lenders holding a majority in
interest of the outstanding Loans and unused Commitments of each affected Class
or (ix) change the rights of the Tranche B Lenders or Tranche C Lenders to
decline mandatory prepayments as provided in Section 2.11, without the written
consent of Tranche B Lenders or Tranche C Lenders, as applicable, holding a
majority of the outstanding Tranche B Term Loans or Tranche C Term Loans, as
applicable; provided further that (A) no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent, the Issuing
Bank or the Swingline Lender without the prior written consent of the
Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may
be, and (B) any waiver, amendment or modification of this Agreement that by its
terms affects the rights or duties under this Agreement of the Revolving Lenders
(but not the Tranche A Lenders, Tranche B Lenders and Tranche C Lenders), the
Tranche A Lenders (but not the Revolving Lenders, Tranche B Lenders and Tranche
C Lenders), the Tranche B Lenders (but not the Revolving Lenders, Tranche A
Lenders and Tranche C Lenders) or the Tranche C Lenders (but not the Revolving
Lenders, the Tranche A Lenders and the Tranche B Lenders) may be effected by an
agreement or agreements in writing entered into by Holdings, the Borrower and
requisite percentage in interest of the affected Class of Lenders.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of counsel for the Administrative Agent, in connection with
the syndication of the credit facilities provided for herein, the preparation
and administration of the Loan Documents or any amendments, modifications or
131
waivers of the provisions thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket
expenses incurred by the Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for
payment thereunder and (iii) all out-of-pocket expenses incurred by the
Administrative Agent, the Issuing Bank or any Lender, including the fees,
charges and disbursements of any counsel for the Administrative Agent, the
Issuing Bank or any Lender, in connection with the enforcement or protection of
its rights in connection with the Loan Documents, including its rights under
this Section, or in connection with the Loans made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.
(b) The Borrower shall indemnify the Administrative Agent, the
Issuing Bank and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an "Indemnitee") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses, including the fees, charges and disbursements of any counsel
for any Indemnitee, incurred by or asserted against any Indemnitee arising out
of, in connection with, or as a result of (i) the execution or delivery of any
Loan Document or any other agreement or instrument contemplated hereby, the
performance by the parties to the Loan Documents of their respective obligations
thereunder or the consummation of the Transactions or any other transactions
contemplated hereby, (ii) any Loan or Letter of Credit or the use of the
proceeds therefrom (including any refusal by the Issuing Bank to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence, Release or threatened Release of
Hazardous Materials on or from any Mortgaged Property or any other property
currently or formerly owned or operated by the Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to the Borrower
or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto, provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that (i) such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or wilful
misconduct of
132
such Indemnitee or (ii) such losses, claims, damages, liabilities or related
expenses of a Lender result from disputes among such Lender and one or more
other Lenders.
(C) To the extent that the Borrower fails to pay any amount required
to be paid by it to the Administrative Agent, the Issuing Bank or the Swingline
Lender under paragraph (a) or (b) of this Section, each Lender severally agrees
to pay to the Administrative Agent, the Issuing Bank or the Swingline Lender, as
the case may be, such Lender's pro rata share (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount, provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against the Administrative Agent, the Issuing Bank or the Swingline
Lender in its capacity as such. For purposes hereof, a Lender's "pro rata share"
shall be determined based upon its share of the sum of the total Revolving
Exposures, outstanding Term Loans and unused Commitments at the time.
(d) To the extent permitted by applicable law, neither Holdings nor
the Borrower shall assert, and each hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement or any agreement or
instrument contemplated hereby, the Transactions, any Loan or Letter of Credit
or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable not later
than ten days after written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby (including any Affiliate of the Issuing
Bank that issues any Letter of Credit) and, to the extent expressly contemplated
133
hereby, the Related Parties of each of the Administrative Agent, the Issuing
Bank and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
(b) Any Lender may assign to one or more additional banks or other
financial institutions (or such other entity as consented to by the Borrower and
the Administrative Agent), all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans at
the time owing to it) provided that (i) except in the case of an assignment to a
Lender or an Affiliate of a Lender or Related Fund of any Lender, each of the
Borrower and the Administrative Agent (and, in the case of an assignment of all
or a portion of a Revolving Commitment or any Lender's obligations in respect of
its LC Exposure or Swingline Exposure, the Issuing Bank and the Swingline
Lender) must give their prior written consent to such assignment (which consent
shall not be unreasonably withheld it being understood that, without limitation,
the Borrowers shall have the right to withhold its consent to any assignment if
(x) increased costs would result therefrom or (y) if in order for such
assignment to comply with applicable law, the Borrower would be required to
obtain the consent of, or make any filing or registration with, any Governmental
Authority), (ii) except in the case of an assignment to a Lender or an Affiliate
or Related Fund of a Lender or an assignment of the entire remaining amount of
the assigning Lender's Commitment or Loans, the amount of the Commitment or
Loans of the assigning Lender subject to each such assignment (determined as of
the date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $5,000,000 unless
each of the Borrower and the Administrative Agent otherwise consent, (iii) each
partial assignment shall be made as an assignment of a proportionate part of all
the assigning Lender's rights and obligations under this Agreement, except that
this clause (iii) shall not be construed to prohibit the assignment of a
proportionate part of all the assigning Lender's rights and obligations in
respect of one Class of Commitments or Loans, (iv) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and recordation fee of $3,500, or, if
to a Lender, an Affiliate of a Lender or a Related Fund, $1,000 and (v) the
assignee, if it shall not be a Lender, shall deliver to the Administrative Agent
an Administrative Questionnaire; and provided further that any consent of the
Borrower otherwise required under this paragraph shall not be required if an
Event of Default under clause (h) or (i) of Article VII has occurred and is
contin-
134
uing. Subject to acceptance and recording thereof pursuant to paragraph (d) of
this Section, from and after the effective date specified in each Assignment and
Acceptance the assignee thereunder shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.15,
2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (e) of
this Section.
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices in The City of New York a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and Holdings, the Borrower, the Administrative
Agent, the Issuing Bank and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower, the Issuing Bank and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
135
(e) Any Lender may, without the consent of the Borrower, the
Administrative Agent, the Issuing Bank or the Swingline Lender, sell
participations to one or more banks or other entities (a "Participant") in all
or a portion of such Lender's rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it),
provided that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) Holdings, the Borrower,
the Administrative Agent, the Issuing Bank 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. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce the Loan Documents and to approve
any amendment, modification or waiver of any provision of the Loan Documents,
provided that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that
affects such Participant. Subject to paragraph (f) of this Section, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.15,
2.16 and 2.17 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.08 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.18(c) as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater
payment under Section 2.15 or 2.17 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.17 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.17(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to
136
any such pledge or assignment of a security interest, provided that no such
pledge or assignment of a security interest shall release a Lender from any of
its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.
(h) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle (an
"SPV"), identified as such in writing from time to time by the Granting Lender
to the Administrative Agent and the Borrower, the option to provide to the
Borrower all or any part of any Loan that such Granting Lender would otherwise
be obligated to make to the Borrower pursuant to this Agreement; provided that
(i) nothing herein shall constitute a commitment by any SPV to make any Loan and
(ii) if an SPV elects not to exercise such option or otherwise fails to provide
all or any part of such Loan, the Granting Lender shall be obligated to make
such Loan pursuant to the terms hereof. The making of a Loan by an SPV hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender. Each party hereto hereby agrees
that no SPV shall be liable for any indemnity or similar payment obligation
under this Agreement (all liability for which shall remain with the Granting
Lender). In furtherance of the foregoing, each party hereto hereby agrees (which
agreement shall survive the termination of this Agreement) that, prior to the
date that is one year and one day after the payment in full of all outstanding
commercial paper or other senior indebtedness of any SPV, it will not institute
against, or join any other person in instituting against, such SPV any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under the laws of the Unites Sates or any State thereof. In addition,
notwithstanding anything to the contrary in this Section 9.04, any SPV may (i)
with notice to, but without the prior written consent of, the Borrower and the
Administrative Agent and without paying any processing fee therefor, assign all
or a portion of its interests in any Loans to the Granting Lender or to any
financial institutions (consented to by the Borrower and the Administrative
Agent) providing liquidity and/or credit support to or for the account of such
SPV to support the funding or maintenance of Loans and (ii) disclose on a
confidential basis any non-public information relating to its Loans to any
rating agency, commercial paper dealer or provider of any surety, guarantee or
credit or liquidity enhancement to such SPV. As this Section 9.04 (h) applies to
any particular SPV, this section may not be amended without the written consent
of such SPV.
138
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such invalidity, illegality or unenforceability without affecting the
validity, legality and enforceability of the remaining provisions hereof; and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, 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 obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) Each of Holdings and the Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to any Loan Document, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Administrative Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
or any other Loan Document against Holdings,
139
the Borrower or its properties in the courts of any jurisdiction.
(c) Each of Holdings and the Borrower hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
any other Loan Document in any court referred to in paragraph (b) of this
Section. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement or any other Loan Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the
Issuing Bank and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates' directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the
140
confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extend requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this
Agreement, (e) in connection with the exercise of any remedies hereunder or
any suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder or thereunder, (f) subject to
a written agreement containing provisions substantially the same as those of
this Section, to any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement, (g) with the consent of the Borrower or (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach
of this Section or (ii) becomes available to the Administrative Agent, the
Issuing Bank or any Lender on a nonconfidential basis from a source other
than Holdings or the Borrower. For the purposes of this Section,
"INFORMATION" means all information received from Holdings or the Borrower
relating to Holdings or the Borrower or its business, other than any such
information that was made available to the Administrative Agent, the Issuing
Bank or any Lender on a nonconfidential basis prior to disclosure by Holdings
or the Borrower. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised customary
procedures for handling confidential information of the same nature as the
Information in accordance with safe and sound banking practices.
SECTION 9.13. INTEREST RATE LIMITATION. Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as
interest on such Loan under applicable law (collectively the "CHARGES"), shall
exceed the maximum lawful rate (the "MAXIMUM RATE") which may be contracted
for, charged, taken, received or reserved by the Lender holding such Loan
in accordance with applicable law, the rate of interest payable in respect of
such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and
the interest and Charges payable to such Lender in respect of other Loans or
periods shall be increased (but not above the Maximum Rate therefor)
141
until such cumulated amount, together with interest thereon at the Federal Funds
Effective Rate to the date of REPAYMENT, shall have been received by such
Lender.
SECTION 9.14. Notice of Lenders' Right to ▇▇▇. The mortgagor or
trustor (borrower) is personally obligated and fully liable for the amount due
under this Agreement. The mortgagee or beneficiary (lender) has the right to ▇▇▇
on this Agreement and obtain a personal judgment against the mortgagor or
trustor for satisfaction of the amount due under this Agreement either before or
after a judicial foreclosure of the mortgage or deed of trust under AS ss.
09.45.170 - 09.45.220.
142
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
ALEC HOLDINGS, INC.,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
ALASKA COMMUNICATIONS SYSTEMS
HOLDINGS, INC.,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
THE CHASE MANHATTAN BANK,
individually and as
Administrative Agent and
Collateral Agent,
by /s/ LBR
-----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON,
individually and as
Documentation Agent,
by
-----------------------------------
Name:
Title:
by
-----------------------------------
Name:
Title:
142
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
ALEC HOLDINGS, INC.,
by
-----------------------------------
Name:
Title:
ALASKA COMMUNICATIONS SYSTEMS
HOLDINGS, INC.,
by
-----------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
individually and as
Administrative Agent and
Collateral Agent,
by
-----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON,
individually and as
Documentation Agent,
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: DIRECTOR
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: ASSOCIATE
ALLSTATE INSURANCE
COMPANY,
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
CIBC INC.
By /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Executive Director
CIBC World Markets Corp. As Agent
FIRST NATIONAL BANK OF
ANCHORAGE,
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
KZH CRESCENT LLC.
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Authorized Agent
METROPOLITAN LIFE
INSURANCE COMPANY,
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Director
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ PRIME INCOME
TRUST,
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: VICE PRESIDENT
NATIONAL BANK OF ALASKA, a national banking association
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Vice President
NATIONSBANK, N.A.,
By /s/ ▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇ ▇▇▇▇▇▇▇▇
Title: SVP
RURAL TELEPHONE FINANCE
COOPERATIVE,
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Secretary-Treasurer
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President Business Development
and Administrative Coordinator
SEQUILS I, LTD
By: TCW Advisers, Inc. as its
Collateral Manager
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VICE PRESIDENT
SRF TRADING, INC.,
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VICE PRESIDENT
▇▇▇▇▇ ▇▇▇ FLOATING RATE
LIMITED LIABILITY COMPANY,
By /s/ ▇▇▇▇▇ ▇. Good
------------------------------------------------
Name: ▇▇▇▇▇ ▇. Good
Title: Vice President,
▇▇▇▇▇ ▇▇▇ & ▇▇▇▇▇▇▇ Incorporated,
as Advisor to the ▇▇▇▇▇ ▇▇▇ Floating Rate
Limited Liability Company
THE INDUSTRIAL BANK OF
JAPAN, LIMITED, NEW YORK
BRANCH,
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: SVP
TORONTO DOMINION (NEW
YORK), INC.,
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VICE PRESIDENT
U.S. BANK NATIONAL
ASSOCIATION,
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇▇▇ ▇▇▇▇▇▇ PRIME RATE
INCOME TRUST,
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: VICE PRESIDENT