Exhibit 10.2
REVOLVING CREDIT AND GUARANTY AGREEMENT
REVOLVING CREDIT AND GUARANTY AGREEMENT dated as of March 6, 2003 among
NTELOS INC., a Virginia corporation (the "Borrower"), a debtor and
debtor-in-possession in a case pending under chapter 11 of the Bankruptcy Code,
and certain other entities listed on Schedule II and the signature pages hereof
as the guarantors (the "Subsidiary Guarantors"), each of which Subsidiary
Guarantors referred to in this paragraph (other than the Non-filing
Subsidiaries) is a debtor and debtor-in-possession in a case pending under
chapter 11 of the Bankruptcy Code (the cases of the Borrower and such Subsidiary
Guarantors, each a "Case" and collectively, the "Cases"), the banks, financial
institutions and other institutional lenders listed on the signature pages
hereof (the "Initial Lenders"), Wachovia Bank, National Association ("Wachovia")
as the Initial Issuing Bank (the "Initial Issuing Bank"), Wachovia Securities
Inc., as lead arranger and sole book-runner (in such capacity, the "Lead
Arranger"), Wachovia as collateral agent (in such capacity and together with any
successor collateral agent appointed pursuant to Article VII, the "Collateral
Agent") and as administrative agent (in such capacity and together with any
successor administrative agent appointed pursuant to Article VII, the
"Administrative Agent" and, together with the Collateral Agent, the "Agent") for
the Lender Parties (as hereinafter defined).
PRELIMINARY STATEMENTS:
(1) On March 4, 2003 (the "Petition Date"), the Borrower and each of
the Subsidiary Guarantors (other than the Non-filing Subsidiaries) filed
separate voluntary petitions with the Bankruptcy Court initiating the Cases and
have continued in the possession of their assets and in the management of their
business pursuant to sections 1107 and 1108 of the Bankruptcy Code.
(2) The Borrower has requested that the Lenders enter into revolving
credit and letter of credit facilities in an aggregate principal amount not to
exceed $35,000,000 with a $5,000,000 sublimit for letters of credit, all of the
Borrower's obligations under which are to be guaranteed by the Subsidiary
Guarantors, for working capital, capital expenditures and other general
corporate purposes of the Borrower and the Subsidiary Guarantors.
(3) To provide guarantees and security for the repayment of the
Advances, and the payment of the other obligations of the Borrower and the
Subsidiary Guarantors hereunder and under the other Loan Documents (and the
Obligations of the Borrower with respect to Debt permitted by Section
5.02(c)(iv)), the Borrower and the Subsidiary Guarantors will provide to the
Agent and the Lenders the following (each as more fully described herein):
a. a guaranty from each of the Subsidiary Guarantors pursuant to
Article VIII hereof of the due and punctual payment of the
Obligations of the Borrower hereunder;
b. subject to the Carve Out, an allowed administrative expense claim
in each of the Cases pursuant to section 364(c)(1) of the
Bankruptcy Code having priority over all administrative expenses
of the kind specified in, or arising under, any Sections of the
Bankruptcy Code (including, without limitation, sections 105,
326, 328, 330, 331, 503(b), 506(c), 507(a), 507(b), 546(c) or 726
thereof) whether or not such claims or expenses may become
secured by a judgment lien or other non-consensual lien, levy or
attachment;
c. subject to the Carve Out, a perfected first priority Lien,
pursuant to section 364(c)(2) of the Bankruptcy Code, upon all
property of the Borrower and the Subsidiary Guarantors that is
unencumbered on the Petition Date and on any unencumbered cash
and cash equivalents in the Cash Concentration Account and L/C
Cash Collateral Account and any investments of the funds
contained therein; and
d. subject to the Carve Out, a perfected junior Lien, pursuant to
section 364(c)(3) of the Bankruptcy Code, upon all property of
the Borrower and the Subsidiary Guarantors (other than the
property referred to in paragraph (e) below that is subject to
the valid and perfected Liens that secure the Borrower's and the
Subsidiary Guarantors' pre-petition Debt under the Existing
Agreement on the Petition Date) that is subject to valid,
perfected and unavoidable Liens in existence on the Petition Date
or that is subject to valid Liens in existence on the Petition
Date that are perfected subsequent to the Petition Date as
permitted by section 546(b) of the Bankruptcy Code or that is
subject to Permitted Liens junior to such valid, perfected and
unavoidable Liens; and
e. subject to the Carve Out, perfected first priority priming Liens,
pursuant to section 364(d)(1) of the Bankruptcy Code, upon all
property of the Borrower and the Subsidiary Guarantors that is
subject to (x) the existing Liens that presently secure the
Borrower's and the Subsidiary Guarantors' pre-petition Debt under
or in connection with that certain Credit Agreement dated as of
July 26, 2000, among the Borrower, the secured lenders from time
to time party thereto and Wachovia as Pre-Petition Agent (as
heretofore amended, amended and restated or otherwise modified,
the "Existing Agreement") (but subject to any Liens to which the
Liens being primed hereby are subject to on the Petition Date or
become subject subsequent to the Petition Date as permitted by
section 546(b) of the Bankruptcy Code) and (y) any Liens granted
after the Petition Date to provide adequate protection in respect
of the Existing Agreement ("Adequate Protection Liens"), which
first priority priming Liens in favor of the Agent and the
Lenders shall be senior in all respects to all of such existing
Liens under or in connection with the Existing Agreement, and to
any Liens granted after the Petition Date to provide adequate
protection in respect thereof.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
2
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01 Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"13-Week Forecast" has the meaning specified in Section
5.03(p).
"Additional Credit" has the meaning specified in Section
3.02(b).
"Adequate Protection Liens" has the meaning specified in
paragraph (3)(e) of the preliminary statements of this Agreement.
"Adjusted Net Income" means, for any period, the aggregate net
income (or loss) (without duplication) of the Financial Covenants
Parties for such period determined in conformity with GAAP, provided
that the following items shall be excluded in computing Adjusted Net
Income (without duplication):
(i) the net income of any Subsidiary to the extent
that the declaration or payment of dividends or similar
distributions by such Subsidiary of such net income is not at
the time permitted by the operation of the terms of its
charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such
Subsidiary;
(ii) any gains or losses (on an after-tax basis)
attributable to any sale, transfer or other disposition of any
asset (other than sales or other dispositions of inventory,
receivables and other current assets); and
(iii) all extraordinary gains, extraordinary losses
and unusual, infrequent or special non-recurring items.
"Administrative Agent" has the meaning specified in the
recital of parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent maintained by the Administrative Agent as the
Administrative Agent shall specify in writing to the Lender Parties.
"Advance" means a Working Capital Advance or a Letter of
Credit Advance.
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
For purposes of this definition, the term "control" (including the
terms "controlling", "controlled by" and "under common control with")
of a Person means the possession, direct or indirect, of the power to
3
vote 5% or more of the Voting Interests of such Person or to direct or
cause the direction of the management and policies of such Person,
whether through the ownership of Voting Interests, by contract or
otherwise.
"Agents" has the meaning specified in the recital of parties
to this Agreement.
"Aggregate Credit Exposure" at any time means the sum of (i)
the Aggregate Outstanding Amount and (ii) the aggregate Unused Working
Capital Commitments at such time.
"Aggregate Outstanding Amount" at any time means the sum of
(i) the aggregate principal amount of Advances outstanding at such time
and (ii) the aggregate Available Amount of all Letters of Credit
outstanding at such time.
"Agreement Value" means, for each Hedge Agreement, on any
date of determination, an amount determined by the Administrative Agent
equal to: (a) in the case of a Hedge Agreement documented pursuant to
the Master Agreement (Multicurrency-Cross Border) published by the
International Swap and Derivatives Association, Inc. (the "Master
Agreement"), the amount, if any, that would be payable by any Loan
Party or any of its Subsidiaries to its counterparty to such Hedge
Agreement, as if (i) such Hedge Agreement was being terminated early on
such date of determination, (ii) such Loan Party or Subsidiary was the
sole "Affected Party", and (iii) the Administrative Agent was the sole
party determining such payment amount (with the Administrative Agent
making such determination pursuant to the provisions of the form of
Master Agreement); or (b) in the case of a Hedge Agreement traded on an
exchange, the ▇▇▇▇-to-market value of such Hedge Agreement, which will
be the unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party party to such Hedge Agreement determined by
the Administrative Agent based on the settlement price of such Hedge
Agreement on such date of determination; or (c) in all other cases, the
▇▇▇▇-to-market value of such Hedge Agreement, which will be the
unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary
of a Loan Party party to such Hedge Agreement determined by the
Administrative Agent as the amount, if any, by which (i) the present
value of the future cash flows to be paid by such Loan Party or
Subsidiary exceeds (ii) the present value of the future cash flows to
be received by such Loan Party or Subsidiary pursuant to such Hedge
Agreement; capitalized terms used and not otherwise defined in this
definition shall have the respective meanings set forth in the above
described Master Agreement.
"Applicable Lending Office" means, with respect to each Lender
Party, such Lender Party's Domestic Lending Office in the case of a
Base Rate Advance and such Lender Party's Eurodollar Lending Office in
the case of a Eurodollar Rate Advance.
"Applicable Margin" means
(i) with respect to any Eurodollar Rate Advance, a
rate per annum equal to 4.00%; and
4
(ii) with respect to any Base Rate Advance, a rate
per annum equal to 3.00%.
"Appropriate Lender" means, at any time, with respect to the
Working Capital Facility, a Lender that has a Commitment with respect
to such Facility at such time, and with respect to the Letter of Credit
Facility, the Issuing Bank.
"Approved Fund" means, with respect to any Lender that is a
fund that invests in bank loans, any other fund that invests in bank
loans and is advised or managed by the same investment advisor as such
Lender or by an Affiliate of such investment advisor.
"Assignment and Acceptance" means an assignment and acceptance
in substantially the form of Exhibit E hereto entered into by a Lender
Party and an Eligible Assignee, and accepted by the Administrative
Agent, in accordance with Section 9.06.
"Available Amount" of any Letter of Credit means, at any time,
the maximum amount available to be drawn under such Letter of Credit at
such time (assuming compliance at such time with all conditions to
drawing).
"Bankruptcy Code" shall mean The Bankruptcy Reform Act of
1978, as heretofore and hereafter amended, and codified as 11 U.S.C.
ss. 101, et seq.
"Bankruptcy Court" shall mean the United States Bankruptcy
Court for the Eastern District of Virginia, Richmond Division, or any
other court having jurisdiction over the Cases from time to time.
"Bankruptcy Law" means any proceeding under the Bankruptcy
Code, or any similar foreign, federal or state law for the relief of
debtors.
"Base Rate" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Rate in effect on such day plus 1/2 of 1%. For purposes hereof,
"Prime Rate" shall mean the rate of interest per annum publicly
announced from time to time by the Administrative Agent as its prime
rate in effect at its principal office in Charlotte, North Carolina;
each change in the Prime Rate shall be effective on the date such
change is publicly announced. If for any reason the Administrative
Agent shall have determined (which determination shall be conclusive
absent manifest error) that it is unable to ascertain the Federal Funds
Rate for any reason, including the inability or failure of the Agent to
obtain sufficient quotations in accordance with the terms hereof, the
Base Rate shall be determined without regard to clause (b) of the first
sentence of this definition, as appropriate until the circumstances
giving rise to such inability no longer exist. Any change in the Base
Rate due to a change in the Prime Rate or the Federal Funds Rate shall
be effective on the effective date of such change in the Prime Rate or
Federal Funds Rate, respectively.
"Base Rate Advance" means an Advance that bears interest as
provided in Section 2.07(a)(i).
"Borrower" has the meaning specified in the recital of parties
to this Agreement.
5
"Borrower's Account" means the account of the Borrower as the
Borrower shall specify in writing to the Administrative Agent.
"Borrowing" means a borrowing consisting of simultaneous
Working Capital Advances of the same Type made by the Working Capital
Lenders.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in Charlotte, North Carolina
and, if the applicable Business Day relates to any Eurodollar Rate
Advances, on which dealings are carried on in the London interbank
market.
"Cap Amount" shall mean, at any date, the "DIP Availability"
set forth in the COD Cash Flow worksheet schedule to the Final Budget
as of such date.
"Capital Expenditures" means, for any Person for any period,
the sum of, without duplication, (a) all expenditures made, directly or
indirectly, by such Person or any of its Subsidiaries during such
period for equipment, fixed assets, real property or improvements, or
for replacements or substitutions therefor or additions thereto, that
have been or should be, in accordance with GAAP, reflected as additions
to property, plant or equipment on a Consolidated balance sheet of such
Person or have a useful life of more than one year plus (b) the
aggregate principal amount of all Debt (including Obligations under
Capitalized Leases) assumed or incurred in connection with any such
expenditures. For purposes of this definition, the purchase price of
equipment that is purchased simultaneously with the trade-in of
existing equipment or with insurance proceeds shall be included in
Capital Expenditures only to the extent of the gross amount of such
purchase price less the credit granted by the seller of such equipment
for the equipment being traded in at such time or the amount of such
proceeds, as the case may be.
"Capital Expenditures Report" means a report substantially in
the form of Exhibit L hereto.
"Capitalized Leases" means all leases that have been or should
be, in accordance with GAAP, recorded as capitalized leases.
"Carve Out" means (i) all fees required to be paid to the
Clerk of the Bankruptcy Court and to the Office of the United States
Trustee under Section 1930(a) of title 28 of the United States Code and
(ii) an amount not exceeding $1,750,000 in the aggregate, which amount
may be used after the occurrence and during the continuance of an Event
of Default, to pay fees or expenses incurred by the Borrower and any
Committee in respect of (A) allowances of compensation for services
rendered or reimbursement or expenses awarded by the Bankruptcy Court
to the Borrower's or the Subsidiary Guarantors' or any Committee's
professionals, any chapter 11 or chapter 7 trustees or examiners
appointed in the Cases and (B) the reimbursement of expenses allowed by
the Bankruptcy Court incurred by Committee members in the performance
of their duties (but excluding fees and expenses of third-party
6
professionals employed by such members); provided, however, that such
dollar limitation on fees and disbursements shall neither be reduced
nor increased by (i) the amount of any compensation and reimbursement
of expenses paid prior to the occurrence of an Event of Default in
respect of which the Carve Out is invoked, (ii) any retainer fees paid
to the Borrower's professionals prior to the Petition Date and (iii)
any fees, expenses, indemnities or other amounts incurred, awarded or
paid to the Agent, any other Agent or the Lenders and their respective
attorneys and agents under this Agreement or otherwise; and provided,
further, that nothing herein shall be construed to impair the ability
of any party to object to any of the fees, expenses, reimbursement or
compensation described in clauses (A) and (B) above.
"Cash Concentration Account" has the meaning specified in the
Security Agreement.
"Cash Equivalents" means any of the following, to the extent
owned by the Borrower or any of its Subsidiaries free and clear of all
Liens other than Liens created under the Collateral Documents and
having a maturity of not greater than 180 days from the date of
acquisition thereof: (a) readily marketable direct obligations of the
Government of the United States or any agency or instrumentality
thereof or obligations unconditionally guaranteed by the full faith and
credit of the Government of the United States, (b) insured certificates
of deposit of or time deposits with any commercial bank that is a
Lender Party or a member of the Federal Reserve System, issues (or the
parent of which issues) commercial paper rated as described in clause
(c) below, is organized under the laws of the United States or any
State thereof and has combined capital and surplus of at least $1
billion or (c) commercial paper in an aggregate amount of no more than
$2 million per issuer outstanding at any time, issued by any
corporation organized under the laws of any State of the United States
and rated at least "Prime-1" (or the then equivalent grade) by ▇▇▇▇▇'▇
Investors Service, Inc. or "A-1" (or the then equivalent grade) by
Standard & Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Cash Reconciliation Report" has the meaning specified in
Section 5.03(o).
"Cash Report" has the meaning specified in Section 3.02(c).
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.
"Change of Control" means the occurrence of any of the
following: (a) any Person or two or more Persons acting in concert
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934), directly or indirectly, of Voting Interests of
the Borrower (or other securities convertible into such Voting
Interests) representing 30% or more of the combined voting power of all
Voting Interests of the Borrower; or (b) during any period of up to 24
consecutive months, commencing before or after the date of this
Agreement, individuals who at the beginning of such 24-month period
7
were directors of the Borrower shall cease for any reason to constitute
a majority of the board of directors of the Borrower; or (c) any Person
or two or more Persons acting in concert shall have acquired by
contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their
acquisition of control over Voting Interests of the Borrower (or other
securities convertible into such Voting Interests) representing 30% or
more of the combined voting power of all Voting Interests of the
Borrower.
"COD Payments" shall mean any payments or deposits made by any
Loan Party to a third-party subsequent to the Petition Date and as
required to be made by such third-party (i) in advance of the time
period during which such payment or deposit is projected to be made on
the Revised Cash Flow schedule of the Final Budget and would be
included in the COD/Deposit Adjustments schedule of the Final Budget or
(ii) in advance of the time such payment or deposit would have been
required to be made by such Loan Party to a third-party in the ordinary
course of business of such Loan Party as conducted prior to the
Petition Date.
"Collateral" means all "Collateral" referred to in the
Collateral Documents and all other property that is subject to any Lien
in favor of the Collateral Agent for the benefit of the Secured
Parties.
"Collateral Agent" has the meaning specified in the recital of
parties to this Agreement.
"Collateral Documents" means the Security Agreement and any
other agreement that creates or purports to create a Lien in favor of
the Collateral Agent for the benefit of the Secured Parties.
"Commitment" means the Working Capital Commitments and the
Letter of Credit Commitments.
"Committee" means any statutory committee appointed in the
Cases.
"Communications Act" means the Communications Act of 1934, and
any similar or successor federal statute, and the rules and regulations
and published policies of the FCC thereunder, all as amended and as the
same may be in effect from time to time.
"Confidential Information" means information that any Loan
Party furnishes to any Agent or any Lender Party in a writing
designated as confidential, but does not include any such information
that is or becomes generally available to the public other than as a
result of a breach by such Agent or any Lender Party of its obligations
hereunder or that is or becomes available to such Agent or such Lender
Party from a source other than the Loan Parties that is not, to the
best of such Agent's or such Lender Party's knowledge, acting in
violation of a confidentiality agreement with a Loan Party.
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
8
"Consummation Date" means the date of the substantial
consummation (as defined in section 1101(2) of the Bankruptcy Code and
which, for purposes of this Agreement, shall be no later than the
effective date) of a Reorganization Plan of any of the Borrower or any
of the Subsidiary Guarantors that is confirmed pursuant to an order of
the Bankruptcy Court in the Cases.
"Contingent Obligation" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to
guarantee any Debt, leases, dividends or other payment Obligations
("primary obligations") of any other Person (the "primary obligor") in
any manner, whether directly or indirectly, including, without
limitation, (a) the direct or indirect guarantee, endorsement (other
than for collection or deposit in the ordinary course of business),
co-making, discounting with recourse or sale with recourse by such
Person of the Obligation of a primary obligor, (b) the Obligation to
make take-or-pay or similar payments, if required regardless of
nonperformance by any other party or parties to an agreement or (c) any
Obligation of such Person, whether or not contingent, (i) to purchase
any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (A) for the
purchase or payment of any such primary obligation or (B) to maintain
working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, assets, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the holder of
such primary obligation against loss in respect thereof. The amount of
any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of
which such Contingent Obligation is made (or, if less, the maximum
amount of such primary obligation for which such Person may be liable
pursuant to the terms of the instrument evidencing such Contingent
Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is
required to perform thereunder), as determined by such Person in good
faith.
"Conversion", "Convert" and "Converted" each refer to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.09 or 2.10.
"Current Assets" of any Person means all assets of such
Person that would, in accordance with GAAP, be classified as current
assets of a company conducting a business the same as or similar to
that of such Person, after deducting adequate reserves in each case in
which a reserve is proper in accordance with GAAP.
"Current Liabilities" of any Person means (a) all Debt of such
Person except Funded Debt, (b) all amounts of Funded Debt of such
Person required to be paid or prepaid within one year after such date
and (c) all other items (including taxes accrued as estimated) that in
accordance with GAAP would be classified as current liabilities of such
Person.
"Debt" of any Person means, without duplication for purposes
of calculating financial ratios, (a) all indebtedness of such Person
for borrowed money, (b) all Obligations of such Person for the deferred
purchase price of property or services (other than trade payables not
overdue by more than 60 days incurred in the ordinary course of such
Person's business), (c) all Obligations of such Person evidenced by
9
notes, bonds, debentures or other similar instruments, (d) all
Obligations of such Person created or arising under any conditional
sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), (e) all Obligations
of such Person as lessee under Capitalized Leases, (f) all Obligations
of such Person under acceptance, letter of credit or similar
facilities, (g) all Obligations of such Person to purchase, redeem,
retire, defease or otherwise make any payment in respect of any Equity
Interests in such Person or any other Person, valued, in the case of
Redeemable Preferred Interests, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends,
but excluding in all cases the Borrower's Obligations to redeem the
Borrower's Senior Cumulative Convertible Preferred Stock, Series B and
the Senior Cumulative Convertible Preferred Stock, Series C, (h) all
Obligations of such Person in respect of Hedge Agreements, valued at
the Agreement Value thereof, (i) all Contingent Obligations of such
Person and (j) all indebtedness and other payment Obligations referred
to in clauses (a) through (i) above of another Person secured by (or
for which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including, without
limitation, accounts and contract rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such indebtedness or other payment Obligations.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"Defaulted Advance" means, with respect to any Lender Party at
any time, the portion of any Advance required to be made by such Lender
Party to the Borrower pursuant to Section 2.01 or 2.02 at or prior to
such time that has not been made by such Lender Party or by the
Administrative Agent for the account of such Lender Party pursuant to
Section 2.02(d) as of such time. In the event that a portion of a
Defaulted Advance shall be deemed made pursuant to Section 2.15(a), the
remaining portion of such Defaulted Advance shall be considered a
Defaulted Advance originally required to be made pursuant to Section
2.01 on the same date as the Defaulted Advance so deemed made in part.
"Defaulted Amount" means, with respect to any Lender Party at
any time, any amount required to be paid by such Lender Party to any
Agent or any other Lender Party hereunder or under any other Loan
Document at or prior to such time that has not been so paid as of such
time, including, without limitation, any amount required to be paid by
such Lender Party to (a) the Issuing Bank pursuant to Section 2.03(c)
to purchase a portion of a Letter of Credit Advance made by such
Issuing Bank, (b) the Administrative Agent pursuant to Section 2.02(d)
to reimburse the Administrative Agent for the amount of any Advance
made by the Administrative Agent for the account of such Lender Party,
10
(c) any other Lender Party pursuant to Section 2.13 to purchase any
participation in Advances owing to such other Lender Party and (d) any
Agent or Issuing Bank pursuant to Section 7.05 to reimburse such Agent
or such Issuing Bank for such Lender Party's ratable share of any
amount required to be paid by the Lender Parties to such Agent or such
Issuing Bank as provided therein. In the event that a portion of a
Defaulted Amount shall be deemed paid pursuant to Section 2.15(b), the
remaining portion of such Defaulted Amount shall be considered a
Defaulted Amount originally required to be paid hereunder or under any
other Loan Document on the same date as the Defaulted Amount so deemed
paid in part.
"Defaulting Lender" means, at any time, any Lender Party that,
at such time owes a Defaulted Advance or a Defaulted Amount.
"Domestic Lending Office" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender Party,
as the case may be, or such other office of such Lender Party as such
Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
"EBITDA" means, for any period, Consolidated Adjusted Net
Income plus, to the extent deducted in computing such Consolidated
Adjusted Net Income, the sum of (a) income or franchise tax expense for
such period, (b) Consolidated Interest Expense, (c) depreciation and
amortization expense, (d) any non-cash charges or non-cash losses and
(e) for any period ending during the Fiscal Year ending December 31,
2002, an aggregate amount of up to $2.1 million of curtailment and
settlement charges incurred in connection with restructuring and
reduction in force activities in March, April, May and June of 2002,
minus, to the extent added in computing such Consolidated Net Income,
(i) any non-cash gains or other non-cash items and (ii) any income tax
credits, all as determined on a Consolidated basis with respect to the
Financial Covenants Parties in accordance with GAAP; provided that, (x)
if any Subsidiary of a Financial Covenants Party (other than another
Financial Covenants Party) is not a wholly owned Subsidiary of such
Financial Covenants Party, EBITDA shall be reduced (to the extent not
otherwise reduced in accordance with GAAP) by an amount equal to (A)
the amount of Consolidated Adjusted Net Income attributable to such
Subsidiary multiplied by (B) the percentage ownership interest in the
income of such Subsidiary not owned on the last day of such period by
such Financial Covenants Party and (y) for purposes of calculating
compliance with the financial covenant set forth in Section 5.04(a),
EBITDA shall exclude the following restructuring and reorganization
costs and fees, to the extent actually incurred during the relevant
period (A) the amount of (x) expenses of the Loan Parties, the
Borrower's senior and subordinated noteholders, the Borrower's
preferred stockholders, the Existing Lenders, the Lenders and the
Collateral Agent payable by any of the Loan Parties and (y) fees and
expenses of professionals employed by the Loan Parties, the Borrower's
senior and subordinated noteholders, the Borrower's preferred
stockholders, the Existing Lenders, the Lenders and the Collateral
11
Agent payable by any of the Loan Parties; provided that the aggregate
costs and fees excluded from EBITDA in reliance on clauses (x) or (y)
and (1) incurred in Fiscal Year 2002 may not exceed $2 million or (2)
incurred in Fiscal Year 2003 may not exceed $14 million, (B) severance
pay and related expenses associated with a reduction in force of up to
$3 million incurred in Fiscal Year 2003, (C) costs incurred in
connection with the buy-out or termination of contracts and leases of
up to $2 million and (D) fees payable to the Collateral Agent and the
Lenders under the Fee Letter and this Agreement.
"Effective Date" means the first date on which the conditions
set forth in Article III shall have been satisfied.
"Eligible Assignee" means any commercial bank or financial
institution, a finance company, insurance company, cooperative
association or fund (whether a corporation, a partnership, trust or
other entity) that is engaged in making, purchasing or otherwise
investing in commercial loans in the ordinary course of business as
approved by the Administrative Agent and (so long as no Event of
Default has occurred and is continuing at the time of such assignment
pursuant to Section 9.06) by the Borrower (such approvals not to be
unreasonably withheld or delayed); provided, however, that neither any
Loan Party nor any affiliate of a Loan Party shall qualify as an
Eligible Assignee under this definition.
"Environmental Action" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental
Law, any Environmental Permit or Hazardous Material or arising from
alleged injury or threat to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory
authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory
authority or third party for damages, contribution, indemnification,
cost recovery, compensation or injunctive relief.
"Environmental Law" means any Federal, state, local statute,
law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or
guidance relating to pollution or protection of the environment,
health, safety or natural resources, including, without limitation,
those relating to the use, handling, transportation, treatment,
storage, disposal, release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, license or
other authorization required under any Environmental Law.
"Equity Interests" means, with respect to any Person, shares
of capital stock of (or other ownership or profit interests in) such
Person, warrants, options or other rights for the purchase or other
acquisition from such Person of shares of capital stock of (or other
ownership or profit interests in) such Person, securities convertible
into or exchangeable for shares of capital stock of (or other ownership
or profit interests in) such Person or warrants, rights or options for
the purchase or other acquisition from such Person of such shares (or
such other interests), and other ownership or profit interests in such
Person (including, without limitation, partnership, member or trust
interests therein), whether voting or nonvoting, and whether or not
such shares, warrants, options, rights or other interests are
authorized or otherwise existing on any date of determination.
12
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title
IV of ERISA is a member of the controlled group of any Loan Party, or
under common control with any Loan Party, within the meaning of Section
414 of the Internal Revenue Code.
"ERISA Event" means (a)(i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such event
has been waived by the PBGC or (ii) the requirements of Section 4043(b)
of ERISA apply with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver
with respect to a Plan; (c) the provision by the administrator of any
Plan of a notice of intent to terminate such Plan, pursuant to Section
4041(a)(2) of ERISA (including any such notice with respect to a plan
amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of any Loan Party or any ERISA Affiliate in
the circumstances described in Section 4062(e) of ERISA; (e) the
withdrawal by any Loan Party or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions
for imposition of a lien under Section 302(f) of ERISA shall have been
met with respect to any Plan; (g) the adoption of an amendment to a
Plan requiring the provision of security to such Plan pursuant to
Section 307 of ERISA; or (h) the institution by the PBGC of proceedings
to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA
that constitutes grounds for the termination of, or the appointment of
a trustee to administer, such Plan.
"Eurocurrency Liabilities" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Eurodollar
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender Party
(or, if no such office is specified, its Domestic Lending Office), or
such other office of such Lender Party as such Lender Party may from
time to time specify to the Borrower and the Administrative Agent.
"Eurodollar Rate" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an
interest rate per annum equal to the rate per annum obtained by
dividing (a) the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor
page) as the London interbank offered rate for deposits in U.S. dollars
at 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period for a period equal to such Interest Period in an
amount comparable to such Borrowing (provided that, if for any reason
such rate is not available, the term "Eurodollar Rate" shall mean, for
13
any Interest Period for all Eurodollar Rate Advances comprising part of
the same Borrowing, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in Dollars in an amount
comparable to such Borrowing at approximately 11:00 A.M. (London time)
two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period; provided, however, if more
than one rate is specified on Reuters Screen LIBO Page, the applicable
rate shall be the arithmetic mean of all such rates) by (b) a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage
for such Interest Period.
"Eurodollar Rate Advance" means an Advance that bears interest
as provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period
for all Eurodollar Rate Advances comprising part of the same Borrowing
means the reserve percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal
reserve requirement) for a member bank of the Federal Reserve System in
New York City with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other
category of liabilities that includes deposits by reference to which
the interest rate on Eurodollar Rate Advances is determined) having a
term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Existing Agreement" has the meaning specified in paragraph
3(e) of the preliminary statements of this Agreement.
"Existing Debt" means Debt of each Loan Party and its
Subsidiaries outstanding immediately before the Petition Date.
"Existing Lenders" means, collectively, the lenders under the
Existing Agreement, together with any successors or assigns thereof.
"Extraordinary Receipt" means any cash received by or paid to
or for the account of any Person not in the ordinary course of
business, including, without limitation, tax refunds, pension plan
reversions, proceeds of insurance (other than proceeds of business
interruption insurance to the extent such proceeds constitute
compensation for lost earnings), condemnation awards (and payments in
lieu thereof), indemnity payments and any purchase price adjustment
received in connection with any purchase agreement; provided, however,
that an Extraordinary Receipt shall not include (x) cash receipts
received from proceeds of insurance, condemnation awards (or payments
in lieu thereof) or indemnity payments to the extent that such
proceeds, awards or payments (A) in respect of loss or damage to
equipment, fixed assets or real property are applied (or in respect of
14
which expenditures were previously incurred) to replace or repair the
equipment, fixed assets or real property in respect of which such
proceeds were received in accordance with the terms of the Loan
Documents, so long as such application is made within 12 months after
the occurrence of such damage or loss or (B) are received by any Person
in respect of any third party claim against such Person and applied to
pay (or to reimburse such Person for its prior payment of) such claim
and the costs and expenses of such Person with respect thereto and (y)
proceeds from any Reduction Asset Sale or any sale or other disposition
of assets excluded from the definition of Reduction Asset Sale.
"Facility" means the Working Capital Facility or the Letter of
Credit Facility.
"FCC" means the Federal Communications Commission or any other
similar successor agency of the Federal government administering the
Communications Act.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"Fee Letter" means the fee letter dated March 4, 2003 between
the Borrower and the Lead Arranger, as amended.
"Final Budget" means the budget and any amendments or
supplements thereto or replacements thereof in the form agreed to by
the Administrative Agent in its sole and absolute discretion setting
forth (i) anticipated cash receipts and disbursements on a weekly basis
and (ii) the anticipated uses of the Commitments on a weekly basis.
"Final Budget Date" means the date of delivery of the initial
Final Budget.
"Final Order" has the meaning set forth in Section 3.02(b).
"Financial Covenants Parties" means the Borrower and its
Subsidiaries.
"Financial Forecasts Report" means the financial forecasts
report, and any amendments or supplements thereto or replacements
thereof, in form and substance satisfactory to the Administrative Agent
in its sole and absolute discretion, setting forth matters including
but not limited to the matters set forth in clauses (A) through (D)
below:
(A) Plans and budgets for each business segment of
the Borrower and its Subsidiaries (including but not limited
to the PCS business segments of Virginia - East, Virginia -
West, and West Virginia), prepared on a quarterly basis for
the fiscal period from January 1, 2003 through December 31,
2005, and on an annual basis thereafter through December 31,
2012.
15
(B) On a consolidated basis (and, to the extent
available from the Borrower's modeling or otherwise, on a
segment basis), projected income statements, projected profit
and loss statements, projected balance sheets, projected
capital expenditures and projected cash flow statements,
prepared on a quarterly basis for the fiscal period from
January 1, 2003 through December 31, 2005 (or on an annual
basis for any period therein for which projections are not
available on a quarterly basis), and on an annual basis
thereafter through December 31, 2012.
(C) All supporting schedules setting forth
projections of sales volumes, network usage, churn, pricing
for all business segments to the extent modeled by the
Borrower in the development of its projections, including but
not limited to supporting schedules setting forth projections
of: wireless sales volumes, including usage (minutes of use)
by Horizon PCS, Inc.; wireless churn; wireless pricing;
components of cost of wireless goods sold and operating
expenses; working capital assumptions including accounts
receivable and days sales outstanding, accounts payable and
days payable outstanding; to the extent available for the
fiscal period from January 1, 2003 through December 31, 2003,
employees, salaries, wages, commissions, bonuses and other
compensation, benefits, social security and pensions costs;
and for each fiscal period thereafter through December 31,
2012, salaries, wages and benefits on an aggregate basis.
(D) Detailed explanations of assets sales (if any)
and other short-term cost reduction and capital expenditure
reduction activities.
(E) Detailed analysis of actual and budgeted capital
expenditures forecasts for the period from January 1, 2003
through September 30, 2003, including a listing by business
segment of each undertaking, describing such undertaking and
the status of such undertaking (items budgeted, items
committed, etc.).
"Financial Forecasts Report Date" means the date of delivery
of the Financial Forecasts Report.
"Fiscal Year" means a fiscal year of the Borrower and its
Consolidated Subsidiaries ending on December 31 in any calendar year.
"Funded Debt" of any Person means Debt in respect of the
Advances, in the case of the Borrower, and all Debt of such Person that
by its terms matures more than one year after the date of determination
or matures within one year from such date but is renewable or
extendible, at the option of such Person, to a date more than one year
after such date or arises under a revolving credit or similar agreement
that obligates the lender or lenders to extend credit during a period
16
of more than one year after such date, including, without limitation,
all amounts of Funded Debt of such Person required to be paid or
prepaid within one year after the date of determination.
"GAAP" has the meaning specified in Section 1.03.
"Guaranteed Obligations" has the meaning specified in Section
8.01(a).
"Guaranties" means the Subsidiary Guaranties.
"Guarantors" means the Subsidiary Guarantors.
"Guaranty Supplement" has the meaning specified in Section
8.05.
"Hazardous Materials" means (a) petroleum or petroleum
products, by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas
and (b) any other chemicals, materials or substances designated,
classified or regulated as hazardous or toxic or as a pollutant or
contaminant under any Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other hedging
agreements.
"Indemnified Party" has the meaning specified in Section
9.04(b).
"Initial Extension of Credit" means the earlier to occur of
the initial Borrowing and the initial issuance of a Letter of Credit
hereunder.
"Initial Issuing Bank" has the meaning specified in the
recital of parties to this Agreement.
"Initial Lenders" has the meaning specified in the recital of
the parties to this Agreement.
"Insufficiency" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.
"Interest Expense" means, for any period, the interest expense
of the Financial Covenants Parties (without duplication) for such
period determined on a Consolidated basis in accordance with GAAP,
including but not limited to the portion of any payments or accruals
with respect to Capitalized Leases that are allocable to interest
expense and including all amendment fees paid by the Borrower during
such period in respect of Debt under this Agreement.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the
date of such Eurodollar Rate Advance or the date of the Conversion of
any Base Rate Advance into such Eurodollar Rate Advance, and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period and ending on
17
the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be
one, two or three months, as the Borrower may, upon notice received by
the Administrative Agent not later than 11:00 A.M. (Charlotte, North
Carolina time) on the third Business Day prior to the first day of such
Interest Period, select; provided, however, that:
(a) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing shall be
of the same duration;
(c) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next succeeding
Business Day, provided, however, that, if such extension would cause
the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on the
next preceding Business Day; and
(d) whenever the first day of any Interest Period occurs on a
day of an initial calendar month for which there is no numerically
corresponding day in the calendar month that succeeds such initial
calendar month by the number of months equal to the number of months in
such Interest Period, such Interest Period shall end on the last
Business Day of such succeeding calendar month.
"Interim Order" has the meaning set forth in Section 3.01(b).
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Inventory" means all Inventory referred to in Section 1(b) of
the Security Agreement.
"Investment" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any Equity Interests or
Debt or the assets comprising a division or business unit or a
substantial part or all of the business of such Person, any capital
contribution to such Person or any other direct or indirect investment
in such Person, including, without limitation, any acquisition by way
of a merger or consolidation and any arrangement pursuant to which the
investor incurs Debt of the types referred to in clause (i) or (j) of
the definition of "Debt" in respect of such Person.
"Issuing Bank" means the Initial Issuing Bank and any Eligible
Assignee to which the Letter of Credit Commitment hereunder has been
assigned pursuant to Section 9.06 so long as such Eligible Assignee
expressly agrees to perform in accordance with their terms all of the
obligations that by the terms of this Agreement are required to be
performed by it as the Issuing Bank and notifies the Administrative
18
Agent of its Applicable Lending Office and the amount of its Letter of
Credit Commitment (which information shall be recorded by the
Administrative Agent in the Register).
"L/C Cash Collateral Account" has the meaning specified in the
Security Agreement.
"L/C Related Documents" has the meaning specified in Section
2.04(b)(ii)(A).
"Lead Arranger" has the meaning specified in the recital of
parties to this Agreement.
"Lender Party" means any Lender and the Issuing Bank.
"Lenders" means the Initial Lenders and each Person that shall
become a Lender hereunder pursuant to Section 9.06 for so long as such
Initial Lender or Person, as the case may be, shall be a party to this
Agreement.
"Letter of Credit Advance" means an advance made by the
Issuing Bank or any Working Capital Lender pursuant to Section 2.03(c).
"Letter of Credit Agreement" has the meaning specified in
Section 2.03(a).
"Letter of Credit Commitment" means, with respect to the
Issuing Bank, at any time, the amount set forth opposite the Issuing
Bank's name on Schedule I hereto under the caption "Letter of Credit
Commitment", as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Letter of Credit Facility" means, at any time, an amount
equal to the amount of the Issuing Bank's Letter of Credit Commitment
at such time, as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Letters of Credit" has the meaning specified in Section
2.01(b).
"License" means any broadband personal communications services
license or cellular license issued by the FCC in connection with the
operation of a System.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance
on title to real property.
"Loan Documents" means (a) for purposes of this Agreement and
the Notes and any amendment, supplement or modification hereof or
thereof, (i) this Agreement, (ii) the Notes, (iii) the Collateral
Documents, (iv) the Fee Letter, (v) each Letter of Credit Agreement and
(b) for purposes of the Collateral Documents and for all other purposes
other than for purposes of this Agreement and the Notes, (i) this
Agreement, (ii) the Notes, (iii) the Collateral Documents, (iv) the Fee
Letter and (v) each Letter of Credit Agreement, in each case as
amended.
19
"Loan Parties" means the Borrower and the Subsidiary
Guarantors.
"Margin Stock" has the meaning specified in Regulation U.
"Material Adverse Change" means any material adverse change in
the business, condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries, taken
as a whole provided that no Material Adverse Change shall be deemed to
exist solely as a result of (i) the commencement of the Cases, (ii) the
items specifically identified and reflected in the financial
projections made available to each of the Lenders prior to the
Effective Date, (iii) the taking of any non-cash writedowns or
impairment charge-offs disclosed to the Lenders prior to the Effective
Date, (iv) restructuring and reorganization costs expensed in the last
quarter of fiscal year 2002 and in fiscal year 2003 and (v) any going
concern qualification or explanation by the Borrower's auditors in
connection with the Borrower's consolidated financial statements for
the fiscal year ending December 31, 2002 or for any subsequent
reporting period after the Petition Date.
"Material Adverse Effect" means a material adverse effect on
(a) the business, condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries, taken
as a whole, (b) the rights and remedies of any Agent or any Lender
Party under any Loan Document or (c) the ability of any Loan Party to
perform its Obligations under any Loan Document to which it is or is to
be a party.
"Material Contract" means, with respect to any Person, each
contract (including all licenses) (i) to which such Person is a party
involving aggregate consideration payable to or by such Person of $2
million or more in any year or (ii) otherwise material to the business,
condition (financial or otherwise), operations, performance or
properties of such Person.
"Maturity Date" means the date that is 180 days after the
Petition Date, or if such date is not a Business Day, the immediately
preceding Business Day; provided that, if on or before such 180th day
(a) the Borrower has delivered to the Administrative Agent a Final
Budget, acceptable to the Administrative Agent in its sole discretion,
for the period of September 1, 2003 through December 31, 2003, (b) this
Agreement has been amended to provide for financial covenants set forth
in Section 5.04 for periods through December 31, 2003, (c) a disclosure
statement regarding a filed Reorganization Plan acceptable to the
Administrative Agent in its sole discretion has been approved by the
Bankruptcy Court and (d) a confirmation hearing on such Reorganization
Plan has been scheduled for a date not later than 225 days after the
Petition Date, the Maturity Date will be 270 days after the Petition
Date, or if such date is not a Business Day, the immediately preceding
Business Day.
"Maximum Facility Availability" shall mean (a) at any time
prior to the receipt by the Administrative Agent of a certified copy of
the Final Order, $15,000,000 and (b) thereafter, the aggregate
Commitments of all Lender Parties at such time (which in any event
shall not exceed $35,000,000 and may be reduced from time to time,
including pursuant to Section 2.05(b)); provided that, at any time
prior to the later to occur of (i) the Administrative Agent's receipt
of a subscription agreement or other evidence of commitments (in a form
acceptable to the Administrative Agent in its sole discretion) from
investors to purchase not less than $75 million in senior unsecured
20
convertible notes on the effective date of a plan of reorganization
acceptable to such note purchasers and the Administrative Agent and
(ii) NTELOS Telephone Inc. and Roanoke & Botetourt Telephone Co.
becoming Subsidiary Guarantors pursuant to Section 8.05 hereof as duly
authorized by the State Corporation Commission of the Commonwealth of
Virginia, the Maximum Facility Availability will be the lesser of (x)
the amount determined in accordance with clauses (a) and (b) and (y)
$10,000,000.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and at least one
Person other than the Loan Parties and the ERISA Affiliates or (b) was
so maintained and in respect of which any Loan Party or any ERISA
Affiliate could have liability under Section 4064 or 4069 of ERISA in
the event such plan has been or were to be terminated.
"Net Cash Proceeds" means, with respect to any sale, lease,
transfer or other disposition of any asset or the incurrence or
issuance of any Debt or the sale or issuance of any Equity Interests
(including, without limitation, any capital contribution) by any
Person, or any Extraordinary Receipt received by or paid to or for the
account of any Person, the aggregate amount of cash received from time
to time (whether as initial consideration or through payment or
disposition of deferred consideration) by or on behalf of such Person
in connection with such transaction after deducting therefrom only
(without duplication) (a) reasonable and customary brokerage
commissions, underwriting fees and discounts, legal fees, finder's fees
and other similar fees and commissions, (b) the amount of taxes payable
in connection with or as a result of such transaction, (c) reasonable
transition costs incurred as a result of any sale, transfer or other
disposition of any asset and (d) the amount of any Debt secured by a
Lien on such asset that, by the terms of the agreement or instrument
governing such Debt, is required to be repaid upon such disposition, in
each case to the extent, but only to the extent, that the amounts so
deducted are, at the time of receipt of such cash, actually paid to a
Person that is not an Affiliate of such Person or any Loan Party or any
Affiliate of any Loan Party and are properly attributable to such
transaction or to the asset that is the subject thereof; provided,
however, that in the case of taxes that are deductible under clause (b)
above but for the fact that, at the time of receipt of such cash, such
taxes have not been actually paid or are not then payable, such Loan
Party or such Subsidiary may deduct an amount (the "Reserved Amount")
equal to the amount reserved in accordance with GAAP for such Loan
Party's or such Subsidiary's reasonable estimate of such taxes, other
than taxes for which such Loan Party or such Subsidiary is indemnified;
provided further, however, that, at the time such taxes are paid, an
21
amount equal to the amount, if any, by which the Reserved Amount for
such taxes exceeds the amount of such taxes actually paid shall
constitute "Net Cash Proceeds" of the type for which such taxes were
reserved for all purposes hereunder.
"Net Income" means, for any period, net income or loss of the
Borrower and the Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, provided that there shall
be excluded (a) the income of any Person in which any other Person
(other than the Borrower or any of the Subsidiaries or any director
holding qualifying shares in compliance with applicable law) has a
joint interest, except to the extent of the amount of dividends or
other distributions (i) that the Borrower or any of the Subsidiaries
has the power to cause such Person to make to the Borrower or any
Subsidiary during such period and such dividend or other distribution
is not prohibited by the terms of any agreement binding upon such
Person or otherwise or (ii) that, to the extent not already included in
Consolidated Net Income for any period pursuant to clause (i) above,
were actually paid to the Borrower or any of the Subsidiaries by such
Person during such period, (b) any after tax gains or losses
attributable to sales of assets out of the ordinary course of business
and (c) (to the extent not included in clause (a) or (b) above) any
extraordinary gains or extraordinary losses.
"Non-filing Subsidiaries" means the Subsidiaries of the
Borrower listed on Schedule III hereto that are not party to a Case.
"Note" means a promissory note of the Borrower payable to the
order of any Working Capital Lender, in substantially the form of
Exhibit A hereto, evidencing the aggregate indebtedness of the Borrower
to such Lender resulting from the Working Capital Advances made by such
Lender, as amended.
"Notice of Borrowing" has the meaning specified in Section
2.02(a).
"Notice of Issuance" has the meaning specified in Section
2.03(a).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether
or not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured,
and whether or not such claim is discharged or stayed. Without limiting
the generality of the foregoing, the Obligations of any Loan Party
under the Loan Documents include (a) the obligation to pay principal,
interest, Letter of Credit commissions, charges, expenses, fees,
attorneys' fees and disbursements, indemnities and other amounts
payable by such Loan Party under any Loan Document, (b) the obligation
of such Loan Party to reimburse any amount in respect of any of the
foregoing that any Lender Party, in its sole discretion (after demand
has been made upon the Borrower), may elect to pay or advance on behalf
of such Loan Party, (c) the obligation of such Loan Party on account of
overdrafts and related liabilities arising from treasury, depository
and cash management services or in connection with any automated
22
clearing house fund transfers provided to or for the benefit of the
Debtors by Wachovia, Branch Banking and Trust Company, Bank of America
or any of their affiliates and (d) the obligation of such Loan Party on
account of their credit card program with Branch Banking & Trust
Company or its affiliates.
"Open Year" has the meaning specified in Section 4.01(t)(iii).
"Operative Cash Flow" shall mean, for any period, (i) actual
cash receipts from customers during such period (calculated using the
same methodology used to calculate "Operative Inflows" in the revised
cash flow worksheet in the Final Budget), less (ii) actual cash
expenditures on operational expenses during such period (calculated
using the same methodology used to calculate "Operative Outflows" in
the revised cash flow worksheet in the Final Budget), less (iii) actual
capital expenditures during such period (calculated using the same
methodology used to calculate "Total Cap Ex" in the revised cash flow
worksheet in the Final Budget), plus (iv) certain actual pre-petition
adjustments that pertain to operative outflows and capital expenditures
(calculated using the same methodology used to calculate
"Total-Operative Outflows Pre-Petition Adjustments" in the pre-petition
adjustments worksheet in the Final Budget) and (v) minus any COD
Payments actually made during such period.
"Orders" means the Interim Order and the Final Order.
"Other Taxes" has the meaning specified in Section 2.12(b).
"Patronage Capital Distributions" shall mean distributions
under Section 1388 of the Internal Revenue Code of 1986, as amended,
including any comparable successor provision, with respect to the
Borrower's patronage of RTFC.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b); (b) Liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's Liens and other
similar Liens arising in the ordinary course of business securing
obligations that are not overdue for a period of more than 60 days; (c)
pledges or deposits to secure obligations under workers' compensation
laws or similar legislation or to secure public or statutory
obligations; (d) Liens incurred or deposits made to secure the
performance of tenders, bids, leases, statutory or regulatory
obligations, bankers' acceptances, surety and appeal obligations of a
similar nature incurred in the ordinary course of business (exclusive
of obligations for the payment of borrowed money); (e) leases or
subleases granted to others that do not materially interfere with the
ordinary course of business of the Borrower and its Subsidiaries, taken
as a whole; (f) Liens evidenced by Uniform Commercial Code financing
statements filed with respect to leases not prohibited hereunder; (g)
Liens in favor of customs and revenue authorities arising as a matter
of law to secure payment of customs duties in connection with the
23
importation of goods; and (h) easements, rights of way and other
encumbrances on title to real property that do not render title to the
property encumbered thereby unmarketable or materially adversely affect
the use of such property for its present purposes.
"Person" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock
company, trust, unincorporated association, joint venture or other
entity, or a government or any political subdivision or agency thereof.
"Petition Date" has the meaning specified in paragraph 1 of
the preliminary statements of this Agreement.
"Plan" means a Single Employer Plan or a Multiple Employer
Plan.
"Pledged Debt" has the meaning specified in the Security
Agreement.
"Post Petition Interest" has the meaning specified in Section
8.06(b).
"Preferred Interests" means, with respect to any Person,
Equity Interests issued by such Person that are entitled to a
preference or priority over any other Equity Interests issued by such
Person upon any distribution of such Person's property and assets,
whether by dividend or upon liquidation.
"Prepayment Date" means the 25th day after the date of entry
of the Interim Order by the Bankruptcy Court if the Final Order has not
been entered by the Bankruptcy Court prior to the expiration of such
25-day period.
"Pre-Petition Agent" means Wachovia as agent for the
Pre-Petition Lenders.
"Pre-Petition Lenders" means the lenders under the Existing
Agreement.
"Pro Rata Share" of any amount means, with respect to any
Lender at any time, the product of such amount times a fraction the
numerator of which is the amount of such Lender's Working Capital
Commitment at such time (or, if the Commitments shall have been
terminated pursuant to Section 2.05 or 6.01, such Lender's Working
Capital Commitment as in effect immediately prior to such termination)
and the denominator of which is the Working Capital Facility at such
time (or, if the Commitments shall have been terminated pursuant to
Section 2.05 or 6.01, the Working Capital Facility as in effect
immediately prior to such termination).
"Redeemable" means any Equity Interest, Debt, right or
Obligation that (a) the issuer thereof has undertaken to redeem at a
fixed or determinable date or dates, whether by operation of a sinking
fund or otherwise, or upon the occurrence of a condition not solely
within the control of such issuer or (b) is redeemable at the option of
the holder.
"Reduction Asset Sale" has the meaning specified in Section
2.06(b)(i)(A).
"Register" has the meaning specified in Section 9.06(d).
24
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Related Business" means any business related to, or
complementary to, the ownership, development, operation or acquisition
of communications systems or the provision of communications services,
in each case as determined by the Board of Directors.
"Remaining Reduction Amount" has the meaning specified in
Section 2.06(b)(iv).
"Reorganization Plan" means a chapter 11 plan of
reorganization in any of the Cases.
"Required Lenders" means Lenders owed or holding at least a
majority in interest of the Aggregate Credit Exposure; provided,
however, that if any Lender shall be a Defaulting Lender at such time,
there shall be excluded from the determination of Required Lenders at
such time (A) the aggregate principal amount of the Advances owing to
such Lender (in its capacity as a Lender) and outstanding at such time,
(B) such Lender's Pro Rata Share of the aggregate Available Amount of
all Letters of Credit outstanding at such time, (C) the aggregate
Unused Working Capital Commitment of such Lender at such time. For
purposes of this definition, the aggregate principal amount of Letter
of Credit Advances owing to the Issuing Bank and the Available Amount
of each Letter of Credit shall be considered to be owed to the Working
Capital Lenders ratably in accordance with their respective Working
Capital Commitments.
"Responsible Officer" means any executive officer of the
Borrower.
"RTFC" shall mean Rural Telephone Finance Cooperative, a South
Dakota cooperative association.
"Secured Parties" means the Agents and the Lender Parties.
"Security Agreement" has the meaning specified in Section
3.01(a)(ii).
"Single Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and no Person other
than the Loan Parties and the ERISA Affiliates or (b) was so maintained
and in respect of which any Loan Party or any ERISA Affiliate could
have liability under Section 4069 of ERISA in the event such plan has
been or were to be terminated.
"Subordinated Obligations" has the meaning specified in
Section 8.06.
"Subsidiary" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or
in which) more than 50% of (a) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall
25
or might have voting power upon the occurrence of any contingency), (b)
the interest in the capital or profits of such partnership, joint
venture or limited liability company or (c) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"Subsidiary Guarantors" means the Subsidiaries of the Borrower
listed on Schedule II hereto and each other Subsidiary of the Borrower
that shall be required to execute and deliver a guaranty pursuant to
Section 5.01(j).
"Subsidiary Guaranty" means the guaranty made by the
Subsidiary Guarantors pursuant to Article VIII.
"Superpriority Claim" means a claim against the Borrower or
any Subsidiary Guarantor in any of the Cases that is a superpriority
administrative expense claim having priority over any or all
administrative expenses and other claims of the kind specified in or
otherwise arising or ordered under, any sections of the Bankruptcy Code
(including, without limitation, sections 105, 326, 328, 330, 331,
503(b), 506(c), 507(a), 507(b), 546(c) and/or 726 thereof), whether or
not such claim or expenses may become secured by a judgment lien or
other non-consensual lien, levy or attachment.
"System" means, as to any Person, assets constituting a radio
communications system authorized under the rules for wireless
communications service (including any license and the network,
marketing, distribution, sales, customer interface and operations
functions relating thereto) owned and operated by such Person.
"Tax Certificate" has the meaning specified in Section
5.03(i).
"Taxes" has the meaning specified in Section 2.12(a).
"Termination Date" means the earliest to occur of (i) the
Prepayment Date, (ii) the Maturity Date, (iii) the Consummation Date
and (iv) the acceleration of the Advances and the termination of the
Commitments in accordance with the terms hereof.
"Trade Letter of Credit" means any Letter of Credit that is
issued under the Letter of Credit Facility for the benefit of a
supplier of Inventory to the Borrower or any of its Subsidiaries to
effect payment for such Inventory.
"Type" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the
Eurodollar Rate.
"Unused Working Capital Commitment" means, with respect to any
Lender at any time, (a) such Lender's Working Capital Commitment at
such time minus (b) the sum of (i) the aggregate principal amount of
all Working Capital Advances and Letter of Credit Advances made by such
Lender (in its capacity as a Lender) and outstanding at such time plus
(ii) such Lender's Pro Rata Share of (A) the aggregate Available Amount
26
of all Letters of Credit outstanding at such time and (B) the aggregate
principal amount of all Letter of Credit Advances made by the Issuing
Bank pursuant to Section 2.03(c) and outstanding at such time.
"Variance Report" shall have the meaning given such term in
Section 5.03(p).
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the
holders of which are ordinarily, in the absence of contingencies,
entitled to vote for the election of directors (or persons performing
similar functions) of such Person, even if the right so to vote has
been suspended by the happening of such a contingency.
"Welfare Plan" means a welfare plan, as defined in Section
3(1) of ERISA, that is maintained for employees of any Loan Party or in
respect of which any Loan Party could have liability.
"Wireless Services" means broadband personal communications
services or cellular services provided in one or more Systems.
"Withdrawal Liability" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"Working Capital Advance" has the meaning specified in Section
2.01(a).
"Working Capital Commitment" means, with respect to any Lender
at any time, the amount set forth opposite such Lender's name on
Schedule I hereto under the caption "Working Capital Commitment" or, if
such Lender has entered into one or more Assignment and Acceptances,
set forth for such Lender in the Register maintained by the
Administrative Agent pursuant to Section 9.06(d) as such Lender's
"Working Capital Commitment", as such amount may be reduced at or prior
to such time pursuant to Section 2.05.
"Working Capital Facility" means, at any time, the aggregate
amount of the Working Capital Lenders' Working Capital Commitments at
such time.
SECTION 1.02 Computation of Time Periods; Other Definitional
Provisions. In this Agreement and the other Loan Documents in the computation of
periods of time from a specified date to a later specified date, the word "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding". References in the Loan Documents to any agreement or contract "as
amended" shall mean and be a reference to such agreement or contract as amended,
amended and restated, supplemented or otherwise modified from time to time in
accordance with its terms.
SECTION 1.03 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
financial statements referred to in Section 4.01(h) ("GAAP").
27
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01 The Advances and the Letters of Credit.
(a) The Working Capital Advances. Each Lender severally and
not jointly agrees, on the terms and conditions hereinafter set forth, to make
advances (each a "Working Capital Advance") to the Borrower from time to time on
any Business Day during the period from the date hereof until the Termination
Date in an amount for each such Advance not to exceed such Lender's Unused
Working Capital Commitment at such time, provided that the obligation of each
Lender to make a Working Capital Advance hereunder at any time is subject to the
condition that, immediately after giving effect to such Working Capital Advance,
the Aggregate Outstanding Amount at such time shall not exceed the lesser of the
Maximum Facility Availability and the Cap Amount applicable at such time. Each
Borrowing shall be in an aggregate amount of $1 million or an integral multiple
of $500,000 in excess thereof (other than a Borrowing the proceeds of which
shall be used solely to repay or prepay in full outstanding Letter of Credit
Advances) and shall consist of Working Capital Advances made simultaneously by
the Lenders ratably according to their Working Capital Commitments. Within the
limits of each Lender's Unused Working Capital Commitment in effect from time to
time, the Working Capital Advances may be repaid and reborrowed in accordance
with the provisions of this Agreement.
(b) Letters of Credit. The Issuing Bank agrees, on the terms
and conditions hereinafter set forth, to issue letters of credit (the "Letters
of Credit") for the account of the Borrower from time to time on any Business
Day during the period from the date hereof until the Termination Date; provided
that the obligation of the Issuing Bank to issue Letters of Credit at any time
is subject to the condition that after giving effect to such issuance, (i) the
aggregate Available Amount for all Letters of Credit which would then be
outstanding shall not exceed the Issuing Bank's Letter of Credit Commitment at
such time and (ii) Aggregate Outstanding Amount at such time shall not exceed
the lesser of the Maximum Facility Availability and the Cap Amount applicable at
such time. No Letter of Credit shall have an expiration date (including any
right of the Borrower or the beneficiary to require renewal) later than the
earlier of 15 days before the Maturity Date or 90 days after the date of
issuance thereof. Within the limits of the Letter of Credit Facility, and
subject to the limits referred to above, the Borrower may request the issuance
of Letters of Credit under this Section 2.01(b), repay any Letter of Credit
Advances resulting from drawings thereunder pursuant to Section 2.03(c) and
request the issuance of additional Letters of Credit under this Section 2.01(b).
SECTION 2.02 Making the Advances. (a) Except as otherwise provided in
Section 2.03, each Borrowing shall be made on notice, given not later than 11:00
A.M. (Charlotte, North Carolina time) on the third Business Day prior to the
date of the proposed Borrowing in the case of a Borrowing consisting of
Eurodollar Rate Advances, or the Business Day prior to the date of the proposed
Borrowing in the case of a Borrowing consisting of Base Rate Advances, by the
Borrower to the Administrative Agent, which shall give to each Appropriate
Lender prompt notice thereof by telex or telecopier. Each such notice of a
Borrowing (a "Notice of Borrowing") (A) shall be by telephone, confirmed
immediately in writing, or telex or telecopier, in substantially the form of
28
Exhibit B hereto, specifying therein the requested (i) date of such Borrowing,
(ii) Type of Advances comprising such Borrowing, (iii) aggregate amount of such
Borrowing and (iv) in the case of a Borrowing consisting of Eurodollar Rate
Advances, the initial Interest Period for such Advances and (B) shall be
accompanied by the certificate of the Chief Financial Officer of the Borrower
required by Section 3.02(c). Each Appropriate Lender shall, before 11:00 A.M.
(Charlotte, North Carolina time) on the date of such Borrowing, make available
for the account of its Applicable Lending Office to the Administrative Agent at
the Administrative Agent's Account, in same day funds, such Lender's Pro Rata
Share of such Borrowing in accordance with the respective Commitments under the
applicable Facility of such Lender and the other Appropriate Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower by crediting the Borrower's Account;
provided, however, that, in the case of any Borrowing, the Administrative Agent
shall first make a portion of such funds equal to the aggregate principal amount
of any Letter of Credit Advances made by the Issuing Bank and by any other
Working Capital Lender and outstanding on the date of such Borrowing, plus
interest accrued and unpaid thereon to and as of such date, available to the
Issuing Bank and such other Working Capital Lenders for repayment of such Letter
of Credit Advances.
(b) Anything in subsection (a) above to the contrary
notwithstanding the Borrower may not select Eurodollar Rate Advances if the
aggregate amount of such Borrowing is less than $1 million or if the obligation
of the Appropriate Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.09 or 2.10.
(c) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower. In the case of any Borrowing that the related Notice of
Borrowing specifies is to be comprised of Eurodollar Rate Advances, the Borrower
shall indemnify each Appropriate Lender against any loss, cost or expense
incurred by such Lender as a result of any failure to fulfill on or before the
date specified in such Notice of Borrowing for such Borrowing the applicable
conditions set forth in Article III, including, without limitation, any loss
(including loss of anticipated profits), cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date.
(d) Unless the Administrative Agent shall have received notice
from an Appropriate Lender prior to the date of any Borrowing under a Facility
under which such Lender has a Commitment that such Lender will not make
available to the Administrative Agent such Lender's Pro Rata Share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in
accordance with subsection (a) of this Section 2.02 and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Lender shall not
have so made such Pro Rata Share available to the Administrative Agent, such
Lender and the Borrower severally agree to repay or pay to the Administrative
29
Agent forthwith on demand such corresponding amount and to pay interest thereon,
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid or paid to the Administrative Agent, at (i) in
the case of the Borrower, the interest rate applicable at such time under
Section 2.07 to Advances comprising such Borrowing and (ii) in the case of such
Lender, the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such corresponding amount, such amount so paid shall constitute such
Lender's Advance as part of such Borrowing for all purposes.
(e) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03 Issuance of and Drawings and Reimbursement Under Letters
of Credit.
(a) Request for Issuance. Each Letter of Credit shall be
issued upon notice, given not later than 11:00 A.M. (New York City time) on the
fifth Business Day prior to the date of the proposed issuance of such Letter of
Credit, by the Borrower to the Issuing Bank, which shall give to the
Administrative Agent and each Lender prompt notice thereof by telex or
telecopier. Each such notice of issuance of a Letter of Credit (a "Notice of
Issuance") shall be by telephone, confirmed immediately in writing, or telex or
telecopier, specifying therein the requested (A) date of such issuance (which
shall be a Business Day), (B) Available Amount of such Letter of Credit, (C)
expiration date of such Letter of Credit, (D) name and address of the
beneficiary of such Letter of Credit and (E) form of such Letter of Credit, and
shall be accompanied by such application and agreement for letter of credit as
the Issuing Bank may specify to the Borrower for use in connection with such
requested Letter of Credit (a "Letter of Credit Agreement"). If (x) the
requested form of such Letter of Credit is acceptable to the Issuing Bank in its
sole discretion and (y) it has not received notice of objection to such issuance
from Lenders holding at least a majority of the Working Capital Commitments, the
Issuing Bank will, upon fulfillment of the applicable conditions set forth in
Article III, and (z) in the case of a Trade Letter of Credit, the Administrative
Agent has given its prior written consent to the issuance thereof, make such
Letter of Credit available to the Borrower at its office referred to in Section
9.02 or as otherwise agreed with the Borrower in connection with such issuance.
In the event and to the extent that the provisions of any Letter of Credit
Agreement shall conflict with this Agreement, the provisions of this Agreement
shall govern.
(b) Letter of Credit Reports. The Issuing Bank shall furnish
(A) to the Administrative Agent on the first Business Day of each week a written
report summarizing issuance and expiration dates of Letters of Credit issued by
the Issuing Bank during the previous week and drawings during such week under
all Letters of Credit issued by such Issuing Bank, (B) to each Lender on the
first Business Day of each month a written report summarizing issuance and
expiration dates of Letters of Credit issued by the Issuing Bank during the
preceding month and drawings during such month under all Letters of Credit
issued by the Issuing Bank and (C) to the Administrative Agent and each Lender
on the first Business Day of each calendar quarter a written report setting
forth the average daily aggregate Available Amount during the preceding calendar
quarter of all Letters of Credit issued by the Issuing Bank.
30
(c) Drawing and Reimbursement. The payment by the Issuing Bank
of a draft drawn under any Letter of Credit shall constitute for all purposes of
this Agreement the making by the Issuing Bank of a Letter of Credit Advance,
which shall be a Base Rate Advance, in the amount of such draft. Upon written
demand by the Issuing Bank with an outstanding Letter of Credit Advance, with a
copy of such demand to the Administrative Agent, each Lender shall purchase from
the Issuing Bank, and the Issuing Bank shall sell and assign to each such
Lender, such Lender's Pro Rata Share of such outstanding Letter of Credit
Advance as of the date of such purchase, by making available for the account of
its Applicable Lending Office to the Administrative Agent for the account of the
Issuing Bank, by deposit to the Administrative Agent's Account, in same day
funds, an amount equal to the portion of the outstanding principal amount of
such Letter of Credit Advance to be purchased by such Lender. Promptly after
receipt thereof, the Administrative Agent shall transfer such funds to the
Issuing Bank. The Borrower hereby agrees to each such sale and assignment. Each
Lender agrees to purchase its Pro Rata Share of an outstanding Letter of Credit
Advance on (i) the Business Day on which demand therefor is made by the Issuing
Bank which made such Advance, provided that notice of such demand is given not
later than 11:00 A.M. (New York City time) on such Business Day, or (ii) the
first Business Day next succeeding such demand if notice of such demand is given
after such time. Upon any such assignment by the Issuing Bank to any Lender of a
portion of a Letter of Credit Advance, the Issuing Bank represents and warrants
to such other Lender that the Issuing Bank is the legal and beneficial owner of
such interest being assigned by it, free and clear of any liens, but makes no
other representation or warranty and assumes no responsibility with respect to
such Letter of Credit Advance, the Loan Documents or any Loan Party. If and to
the extent that any Lender shall not have so made the amount of such Letter of
Credit Advance available to the Administrative Agent, such Working Capital
Lender agrees to pay to the Administrative Agent forthwith on demand such amount
together with interest thereon, for each day from the date of demand by the
Issuing Bank until the date such amount is paid to the Administrative Agent, at
the Federal Funds Rate for its account or the account of the Issuing Bank, as
applicable. If such Lender shall pay to the Administrative Agent such amount for
the account of the Issuing Bank on any Business Day, such amount so paid in
respect of principal shall constitute a Letter of Credit Advance made by such
Lender on such Business Day for purposes of this Agreement, and the outstanding
principal amount of the Letter of Credit Advance made by the Issuing Bank shall
be reduced by such amount on such Business Day.
(d) Failure to Make Letter of Credit Advances. The failure of
any Lender to make the Letter of Credit Advance to be made by it on the date
specified in Section 2.03(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such date, but no
Lender shall be responsible for the failure of any other Lender to make the
Letter of Credit Advance to be made by such other Lender on such date.
SECTION 2.04 Repayment of Advances.
(a) Working Capital Advances. The Borrower shall repay to the
Administrative Agent for the ratable account of the Lenders on the Termination
Date the aggregate principal amount of the Working Capital Advances then
outstanding.
(b) Letter of Credit Advances. (a) The Borrower shall repay
to the Administrative Agent for the account of the Issuing Bank and each other
Lender that has made a Letter of Credit Advance on the earlier of the 7th day
after the date on which such Advance was made and the Termination Date the
outstanding principal amount of each Letter of Credit Advance made by each of
them.
31
(ii) The Obligations of the Borrower under this
Agreement, any Letter of Credit Agreement and any other agreement or instrument
relating to any Letter of Credit shall be unconditional and irrevocable, and
shall be paid strictly in accordance with the terms of this Agreement, such
Letter of Credit Agreement and such other agreement or instrument under all
circumstances, including, without limitation, the following circumstances (it
being understood that any such payment by the Borrower is without prejudice to,
and does not constitute a waiver of, any rights the Borrower might have or might
acquire as a result of the payment by the Issuing Bank of any draft or the
reimbursement by the Borrower thereof):
(A) any lack of validity or enforceability of any
Loan Document, any Letter of Credit Agreement, any Letter of
Credit or any other agreement or instrument relating thereto
(all of the foregoing being, collectively, the "L/C Related
Documents");
(B) any change in the time, manner or place of
payment of, or in any other term of, all or any of the
Obligations of the Borrower in respect of any L/C Related
Document or any other amendment or waiver of or any consent to
departure from all or any of the L/C Related Documents;
(C) the existence of any claim, set-off, defense or
other right that the Borrower may have at any time against any
beneficiary or any transferee of a Letter of Credit (or any
Persons for which any such beneficiary or any such transferee
may be acting), the Issuing Bank or any other Person, whether
in connection with the transactions contemplated by the L/C
Related Documents or any unrelated transaction;
(D) any statement or any other document presented
under a Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect;
(E) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or certificate that
does not strictly comply with the terms of such Letter of
Credit;
(F) any exchange, release or non-perfection of any
Collateral or other collateral, or any release or amendment or
waiver of or consent to departure from the Guaranties or any
other guarantee, for all or any of the Obligations of the
Borrower in respect of the L/C Related Documents; or
(G) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including,
without limitation, any other circumstance that might
otherwise constitute a defense available to, or a discharge
of, the Borrower or a guarantor.
32
SECTION 2.05 Termination or Reduction of the Commitments. (a) Optional.
The Borrower may, upon at least five Business Days' notice to the Administrative
Agent, terminate in whole or reduce in part the unused portions of the Letter of
Credit Facility and the Unused Working Capital Commitments; provided, however,
that each partial reduction of a Facility (i) shall be in an aggregate amount of
$500,000 or an integral multiple of $100,000 in excess thereof (or any lesser
amount equal to the remaining unused portion of the Letter of Credit Facility
and the Unused Working Capital Commitments, as the case may be) and (ii) shall
be made ratably among the Appropriate Lenders in accordance with their
Commitments with respect to such Facility.
(b) Mandatory. The Facilities shall be automatically and
permanently reduced, on a pro rata basis, on each date on which prepayment (in
the case of the Working Capital Facility) or cash collateralization (in the case
of the Letter of Credit Facility) thereof is required to be made pursuant to
Section 2.06(b)(i) in an amount equal to the applicable Reduction Amount,
provided that each such reduction of the Working Capital Facility shall be made
ratably among the Lenders in accordance with their Working Capital Commitments.
SECTION 2.06 Prepayments.(a) Optional. The Borrower may, upon at least
one Business Day's notice in the case of Base Rate Advances and upon at least
three Business Days' notice in the case of Eurodollar Rate Advances, in each
case to the Administrative Agent and in the form of Exhibit C hereto stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Borrower shall, prepay the outstanding aggregate principal
amount of the Advances comprising part of the same Borrowing in whole or ratably
in part, together with accrued interest to the date of such prepayment on the
aggregate principal amount prepaid; provided, however, that (x) each partial
prepayment shall be in an aggregate principal amount of $500,000 or an integral
multiple of $100,000 in excess thereof and (y) if any prepayment of a Eurodollar
Rate Advance is made on a date other than the last day of an Interest Period for
such Advance, the Borrower shall also pay any amounts owing pursuant to Section
9.04(c).
(b) Mandatory. (i) The Borrower shall:
(A) Promptly upon but in no event later than three
Business Days after receipt of the Net Cash Proceeds by the
Borrower or any of its Subsidiaries from the sale, lease,
transfer or other disposition of any assets of the Borrower or
any of its Subsidiaries (except for sales of assets permitted
by clauses (i) or (ii) of Section 5.02(f)) (any such
non-excluded asset sale, a "Reduction Asset Sale"), prepay an
aggregate principal amount of the Advances comprising part of
the same Borrowings and deposit in the L/C Cash Collateral
Account an amount (the "Reduction Amount") equal to 100% of
the Net Cash Proceeds from such Reduction Asset Sale.
(B) Promptly upon but in no event later than three
Business Days after receipt of any Extraordinary Receipt,
prepay an aggregate principal amount of the Advances
comprising part of the same Borrowing and deposit an amount in
the L/C Cash Collateral Amount in an amount equal to 100% of
the amount of such Extraordinary Receipt.
33
(ii) The Borrower shall, on each Business Day, prepay
an aggregate principal amount of the Working Capital Advances
and the Letter of Credit Advances and deposit an amount in the
L/C Cash Collateral Account in an aggregate amount equal to
the amount by which (A) the sum of (x) the aggregate principal
amount of the Working Capital Advances plus (y) the aggregate
principal amount of Letter of Credit Advances plus (z) the
aggregate Available Amount of all Letters of Credit then
outstanding exceeds (B) the Maximum Facility Availability on
such Business Day.
(iii) The Borrower shall, on each Business Day, pay
to the Administrative Agent for deposit in the L/C Cash
Collateral Account an amount sufficient to cause the aggregate
amount on deposit in the L/C Cash Collateral Account to equal
the amount by which the aggregate Available Amount of all
Letters of Credit then outstanding exceeds the Letter of
Credit Facility on such Business Day.
(iv) Prepayments and deposits made pursuant to clause
(i) or (ii) shall be first applied to prepay Letter of Credit
Advances then outstanding until such Advances are paid in
full, second to prepay Working Capital Advances then
outstanding comprising part of the same Borrowings until such
Advances are paid in full third deposited in the L/C Cash
Collateral Account to cash collateralize 100% of the Available
Amount of the Letters of Credit then outstanding and fourth in
the case of prepayments of the Working Capital Facility
required pursuant to clause (i) above, the amount remaining
(if any) after the prepayment in full of the Advances then
outstanding and the 100% cash collateralization of the
aggregate Available Amount of Letters of Credit then
outstanding (such remaining amount being referred to herein as
the "Remaining Reduction Amount") shall be applied to repay
outstanding pre-petition Debt owed to the Existing Lenders
under the Existing Agreement in accordance with the terms
thereof and of the Orders, or as otherwise directed by the
Bankruptcy Court. Upon the drawing of any Letter of Credit for
which funds are on deposit in the L/C Cash Collateral Account,
such funds shall be applied to reimburse the Issuing Bank or
Working Capital Lenders, as applicable.
(v) Prepayments of the Working Capital Facility shall
be applied first to prepay Base Rate Advances comprising part
of the same Borrowings and second to prepay Eurodollar Rate
Advances comprising part of the same Borrowings and designated
by the Borrower (or, absent such designation, as selected by
the Administrative Agent in its discretion).
SECTION 2.07 Interest. (a) Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of the Advances owing to each Lender
from the date of such Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Base Rate Advances. During such periods as such
Advance is a Base Rate Advance, a rate per annum equal at all
times to the sum of (A) the Base Rate in effect from time to
time plus (B) the Applicable Margin in effect from time to
time, payable in arrears monthly on the last day of each
34
calendar month during such periods (and if such date is not a
Business Day, on the immediately preceding Business Day) and
on the date such Base Rate Advance shall be Converted or paid
in full.
(ii) Eurodollar Rate Advances. During such periods as
such Advance is a Eurodollar Rate Advance, a rate per annum
equal at all times during each Interest Period for such
Advance to the sum of (A) the Eurodollar Rate for such
Interest Period for such Advance plus (B) the Applicable
Margin in effect on the first day of such Interest Period,
payable in arrears on the last day of such Interest Period.
(b) Default Interest. Upon the occurrence and during the
continuance of an Event of Default, the Borrower shall pay interest on (i) the
unpaid principal amount of each Advance owing to each Lender, payable in arrears
on the dates referred to in clause (a)(i) or (a)(ii) above and on demand, at a
rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid on such Advance pursuant to clause (a)(i) or (a)(ii) above
and (ii) to the fullest extent permitted by law, the amount of any interest, fee
or other amount payable under the Loan Documents that is not paid when due, from
the date such amount shall be due until such amount shall be paid in full,
payable in arrears on the date such amount shall be paid in full and on demand,
at a rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid, in the case of interest, on the Type of Advance on which
such interest has accrued pursuant to clause (a)(i) or (a)(ii) above and, in all
other cases, on Base Rate Advances pursuant to clause (a)(i) above.
(c) Notice of Interest Period and Interest Rate. Promptly
after receipt of a Notice of Borrowing pursuant to Section 2.02(a), a notice of
Conversion pursuant to Section 2.09 or a notice of selection of an Interest
Period pursuant to the terms of the definition of "Interest Period", the
Administrative Agent shall give notice to the Borrower and each Appropriate
Lender of the applicable Interest Period and the applicable interest rate
determined by the Administrative Agent for purposes of clause (a)(i) or (a)(ii)
above.
SECTION 2.08 Fees. (a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the account of the Lenders a commitment fee, from the
date hereof in the case of an Initial Lender, and from the effective date
specified in the Assignment and Acceptance pursuant to which it became a Lender
in the case of each other Lender until the Termination Date, payable in arrears
on the date of the initial Borrowing hereunder, and monthly on the last day of
each month and on the Termination Date, at a rate per annum equal to 0.50% on
each Lender's average daily Unused Working Capital Commitment; provided,
however, that any commitment fee accrued with respect to any of the Commitments
of a Defaulting Lender during the period prior to the time such Lender became a
Defaulting Lender and unpaid at such time shall not be payable by the Borrower
so long as such Lender shall be a Defaulting Lender except to the extent that
such commitment fee shall otherwise have been due and payable by the Borrower
prior to such time.
(b) Letter of Credit Fees, Etc. (i) The Borrower shall pay to
the Administrative Agent for the account of each Lender a commission, payable in
arrears monthly on the last day of each month, commencing March 31, 2003, and on
35
the Termination Date, on such Lender's Pro Rata Share of the average daily
aggregate Available Amount during such month of all Letters of Credit
outstanding from time to time at a rate per annum equal to the Applicable Margin
for Eurodollar Advances under the Working Capital Facility.
(ii) The Borrower shall pay to the Issuing Bank, for
its own account, (A) an issuance fee for each Letter of Credit
in an amount equal to 1/4 of 1% of the Available Amount of
such Letter of Credit on the date of issuance of such Letter
of Credit, payable on such date and (B) such other transfer
fees and other fees and charges in connection with the
issuance or administration or renewal or extension of each
Letter of Credit as the Borrower and the Issuing Bank shall
agree.
(c) Agents' Fees. The Borrower shall pay to the Agent, for the
respective accounts of the Agent and the Lenders, the fees set forth in the Fee
Letter at the times set forth therein.
SECTION 2.09 Conversion of Advances. (a) Optional. The Borrower may on
any Business Day, upon notice given to the Administrative Agent in the form of
Exhibit D hereto not later than 11:00 A.M. (Charlotte, North Carolina time) on
the third Business Day prior to the date of the proposed Conversion and subject
to the provisions of Section 2.10, Convert all or any portion of the Advances of
one Type comprising the same Borrowing into Advances of the other Type;
provided, however, that any Conversion of Eurodollar Rate Advances into Base
Rate Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar
Rate Advances shall be in an amount not less than the minimum amount specified
in Section 2.02(b) and each Conversion of Advances comprising part of the same
Borrowing under any Facility shall be made ratably among the Appropriate Lenders
in accordance with their Commitments under such Facility. Each such notice of
Conversion shall, within the restrictions specified above, specify (i) the date
of such Conversion, (ii) the Advances to be Converted and (iii) if such
Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for such Advances. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
(b) Mandatory. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $1 million, such
Advances shall automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the
duration of any Interest Period for any Eurodollar Rate
Advances in accordance with the provisions contained in the
definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and
the Appropriate Lenders, whereupon the Interest Period for
such Eurodollar Rate Advances will automatically be one month.
(iii) Upon the occurrence and during the continuance
of any Event of Default, (x) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest
36
Period therefor, Convert into a Base Rate Advance and (y) the
obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended.
SECTION 2.10 Increased Costs, Etc. (a) If, due to either (i) the
introduction of any change (other than any change by way of imposition or
increase of reserve requirements included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender Party of agreeing to make or of making,
funding or maintaining Eurodollar Rate Advances or of agreeing to issue or of
issuing or maintaining or participating in Letters of Credit or of agreeing to
make or of making or maintaining Letter of Credit Advances (excluding, for
purposes of this Section 2.10, any such increased costs resulting from changes
in the basis of taxation of net income by the United States or by the foreign
jurisdiction or state under the laws of which such Lender Party is organized or
has its Applicable Lending Office or any political subdivision thereof), then
the Borrower shall from time to time, upon demand by such Lender Party (with a
copy of such demand to the Administrative Agent), pay to the Administrative
Agent for the account of such Lender Party additional amounts sufficient to
compensate such Lender Party for such increased cost; provided, however, that a
Lender Party claiming additional amounts under this Section 2.10(a) agrees to
use reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to provide appropriate certificates or other
documentation and designate a different Applicable Lending Office if such
certificate, other documentation or the making of such a designation would avoid
the need for, or reduce the amount of, such increased cost that may thereafter
accrue and would not, in the reasonable judgment of such Lender Party, be
otherwise disadvantageous to such Lender Party. A certificate as to the amount
of such increased cost, submitted to the Borrower by such Lender Party, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If, due to either (i) the introduction of or any change in
or in the interpretation of any law or regulation or (ii) the compliance with
any guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
amount of capital required or expected to be maintained by any Lender Party or
any corporation controlling such Lender Party as a result of or based upon the
existence of such Lender Party's commitment to lend or to issue or participate
in Letters of Credit hereunder and other commitments of such type or the
issuance or maintenance of or participation in the Letters of Credit (or similar
contingent obligations), then, upon demand by such Lender Party or such
corporation (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to the Administrative Agent for the account of such Lender
Party, from time to time as specified by such Lender Party, additional amounts
sufficient to compensate such Lender Party in the light of such circumstances,
to the extent that such Lender Party reasonably determines such increase in
capital to be allocable to the existence of such Lender Party's commitment to
lend or to issue or participate in Letters of Credit hereunder or to the
issuance or maintenance of or participation in any Letters of Credit. A
certificate as to such amounts submitted to the Borrower by such Lender Party
shall be conclusive and binding for all purposes, absent manifest error.
37
(c) If, with respect to any Eurodollar Rate Advances, Lenders
owed at least a majority of the then aggregate unpaid principal amount thereof
notify the Administrative Agent that the Eurodollar Rate for any Interest Period
for such Advances will not adequately reflect the cost to such Lenders of
making, funding or maintaining their Eurodollar Rate Advances for such Interest
Period, the Administrative Agent shall forthwith so notify the Borrower and the
Appropriate Lenders, whereupon (i) each such Eurodollar Rate Advance under such
Facility will automatically, on the last day of the then existing Interest
Period therefor, Convert into a Base Rate Advance and (ii) the obligation of the
Appropriate Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrower that such Lenders have determined that the circumstances causing such
suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance by such
Lender will automatically, upon such demand, Convert into a Base Rate Advance
and (ii) the obligation of the Appropriate Lenders to make, or to Convert
Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower that such Lender has determined
that the circumstances causing such suspension no longer exist ; provided,
however, that, before making any such demand, such Lender agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office if the making
of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances and would not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender.
(e) In the event that any Lender Party demands payment of
costs or additional amounts pursuant to Section 2.10 or Section 2.12 or asserts,
pursuant to Section 2.10(d), that it is unlawful for such Lender Party to make
Eurodollar Rate Advances or become a Defaulting Lender, then (subject to such
Lender Party's right to rescind such demand or assertion within 10 days after
the notice from the Borrower referred to below) the Borrower may, upon 20 days'
prior written notice to such Lender Party and the Administrative Agent, elect to
cause such Lender Party to assign its Advances and Commitments in full to one or
more Persons selected by the Borrower so long as (a) each such Person satisfies
criteria of an Eligible Assignee and is reasonably satisfactory to the
Administrative Agent, (b) such Lender Party receives payment in full in cash of
the outstanding principal amount of all Advances made by it and all accrued and
unpaid interest thereon and all other amounts due and payable to such Lender
Party as of the date of such assignment (including, without limitation, amounts
owing pursuant to Sections 2.10, 2.12, 2.15 and 9.04) and (c) each such Lender
Party assignee agrees to accept such assignment and to assume all obligations of
such Lender Party hereunder, in accordance with Section 9.07.
SECTION 2.11 Payments and Computations. (a) The Borrower shall make
each payment hereunder and under the Notes, irrespective of any right of
counterclaim or set-off (except as otherwise provided in Section 2.15), not
later than 11:00 A.M. (Charlotte, North Carolina time) on the day when due in
38
U.S. dollars to the Administrative Agent at the Administrative Agent's Account
in same day funds, with payments being received by the Administrative Agent
after such time being deemed (other than for purposes of Section 6.01(a) if
received on the day when due) to have been received on the next succeeding
Business Day. The Administrative Agent will promptly thereafter cause like funds
to be distributed (i) if such payment by the Borrower is in respect of
principal, interest, commitment fees or any other Obligation then payable
hereunder and under the Notes to more than one Lender Party, to such Lender
Parties for the account of their respective Applicable Lending Offices ratably
in accordance with the amounts of such respective Obligations then payable to
such Lender Parties and (ii) if such payment by the Borrower is in respect of
any Obligation then payable hereunder to one Lender Party, to such Lender Party
for the account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an
Assignment and Acceptance and recording of the information contained therein in
the Register pursuant to Section 9.07(d), from and after the effective date of
such Assignment and Acceptance, the Administrative Agent shall make all payments
hereunder and under the Notes in respect of the interest assigned thereby to the
Lender Party assignee thereunder, and the parties to such Assignment and
Acceptance shall make all appropriate adjustments in such payments for periods
prior to such effective date directly between themselves.
(b) The Borrower hereby authorizes each Lender Party, if and
to the extent payment owed to such Lender Party is not made when due hereunder
or, in the case of a Lender, under the Note held by such Lender, to charge from
time to time against any or all of the Borrower's accounts with such Lender
Party any amount so due.
(c) All computations of interest based on the Base Rate or the
Federal Funds Rate shall be made by the Administrative Agent on the basis of a
year of 365 or 366 days, as the case may be, and all computations of interest
based on the Eurodollar Rate and of fees and Letter of Credit commissions shall
be made by the Administrative Agent on the basis of a year of 360 days, in each
case for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest, fees or commissions
are payable. Each determination by the Administrative Agent of an interest rate,
fee or commission hereunder shall be conclusive and binding for all purposes,
absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or commitment fee, as
the case may be; provided, however, that, if such extension would cause payment
of interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(e) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to any Lender
Party hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
39
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
(f) If the Administrative Agent receives funds for application
to the Obligations under the Loan Documents under circumstances for which the
Loan Documents do not specify the Advances or the Facility to which, or the
manner in which, such funds are to be applied, the Administrative Agent may, but
shall not be obligated to, elect to distribute such funds to each Lender Party
ratably in accordance with such Lender Party's proportionate share of the
principal amount of all outstanding Advances and the Available Amount of all
Letters of Credit then outstanding, in repayment or prepayment of such of the
outstanding Advances or other Obligations owed to such Lender Party, and for
application to such principal installments, as the Administrative Agent shall
direct.
SECTION 2.12 Taxes. (a) Any and all payments made by or on behalf of
any Loan Party hereunder, or under the Notes or any other Loan Document, shall
be made, in accordance with Section 2.11, free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities, interest, penalties and additions
to tax with respect thereto (excluding any amount resulting from the gross
negligence or willful misconduct of a Lender Party or an Agent), excluding, in
the case of each Lender Party and each Agent, taxes that are imposed on its net
income by the United States and taxes that are imposed on its net income (and
franchise taxes imposed in lieu thereof) by the state or foreign jurisdiction
under the laws of which such Lender Party or such Agent, as the case may be, is
organized or any political subdivision thereof and, in the case of each Lender
Party, taxes that are imposed on its net income (and franchise taxes imposed in
lieu thereof) by the state or foreign jurisdiction of such Lender Party's
Applicable Lending Office or any political subdivision thereof (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder, or under any
Note or any other Loan Document, to any Lender Party or any Agent, (i) the sum
payable by the Borrower shall be increased as may be necessary so that after the
Borrower and the Administrative Agent have made all required deductions
(including deductions applicable to additional sums payable under this Section
2.12) such Lender Party or such Agent, as the case may be, receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make all such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable law; provided, however, that a Lender Party claiming
additional amounts under this Section 2.12(a) or 2.12(b) agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to provide appropriate certificates or other documentation (except
to the extent Error! Bookmark not defined. the Lender Party considers any such
required information confidential and (a). such certificates or documentation
are materially more burdensome than Internal Revenue Service Form W-8BEN) and
designate a different
40
Applicable Lending Office if the providing of such certificates or documentation
or the making of such a designation would avoid the need for, or reduce the
amount of, such additional amounts that may thereafter accrue and would not, in
the reasonable judgment of such Lender Party, be otherwise disadvantageous to
such Lender Party.
(b) In addition, the Borrower shall pay any present or future
stamp, documentary, excise, property or similar taxes, charges or levies that
arise from any payment made hereunder, or under the Notes or any other Loan
Documents, or from the execution, delivery or registration of, performance
under, or otherwise with respect to, this Agreement, the Notes or any other Loan
Document, (hereinafter referred to as "Other Taxes").
(c) The Borrower shall indemnify each Lender Party and each
Agent for and hold them harmless against the full amount of Taxes and Other
Taxes, and for the full amount of taxes of any kind imposed by any jurisdiction
on amounts payable under this Section 2.12, imposed on or paid by such Lender
Party or such Agent (as the case may be) and any liability (including penalties,
additions to tax, interest and expenses, but excluding any amount resulting from
the gross negligence or willful misconduct of a Lender Party or an Agent)
arising therefrom or with respect thereto. This indemnification shall be made
within 30 days from the date such Lender Party or such Agent (as the case may
be) makes written demand therefor. Each Agent and each Lender Party claiming
indemnification pursuant to this Section 2.12(c) shall make written demand
therefor no later than 120 days after the date on which such Agent or Lender
Party makes payment of such Taxes or Other Taxes. However, nothing contained in
this Section 2.12(c) shall compromise the right of any Agent or Lender Party to
be indemnified pursuant to this Agreement.
(d) Within 30 days after the date of any payment of Taxes by
or on behalf of any Loan Party, the Borrower shall furnish to the Administrative
Agent, at its address referred to in Section 9.02, the original or a certified
copy of a receipt evidencing such payment (or if such receipt has not been
received by the Borrower by such time within 30 days after such receipt by the
Borrower) (or, if no such receipt will be forthcoming, such other written
documentation reasonably satisfactory to the Administrative Agent). In the case
of any payment hereunder, or under the Notes or any other Loan Document, by or
on behalf of the Borrower through an account or branch outside the United States
or by or on behalf of the Borrower by a payor that is not a United States
person, if the Borrower determines that no Taxes are payable in respect thereof,
the Borrower shall furnish, or shall cause such payor to furnish, to the
Administrative Agent, at such address, an opinion of counsel acceptable to the
Administrative Agent stating that such payment is exempt from Taxes. For
purposes of this Section 2.12, the terms "United States" and "United States
person" shall have the meanings specified in Section 7701 of the Internal
Revenue Code.
(e) Each Lender Party organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date of its
execution and delivery of this Agreement in the case of each Initial Lender or
Initial Issuing Bank, as the case may be, and on the date of the Assignment and
Acceptance pursuant to which it becomes a Lender Party in the case of each other
Lender Party, and from time to time thereafter as reasonably requested in
writing by the Borrower (but only so long thereafter as such Lender Party
remains lawfully able to do so), provide each of the Administrative Agent and
the Borrower with either (i) two properly completed original Internal Revenue
Service forms W-8ECI or W-8BEN (or any applicable successor forms), certifying
that such Lender Party is exempt from or entitled to a reduced rate of United
States federal withholding tax on payments pursuant to this Agreement or under
41
the Notes (by reason of such payments being effectively connected to a United
States trade or business of such Lender Party, or by reason of such Lender Party
being eligible for the benefits of a current United States income tax treaty
with respect to such payments), or (ii) two properly completed original Internal
Revenue Service forms W-8BEN (or any applicable successor forms), certifying
that such Lender Party is a foreign corporation, foreign partnership, or foreign
estate or trust, along with a certificate representing that such Lender Party is
not a "bank" for purposes of Section 881(c) of the Internal Revenue Code, is not
a 10-percent shareholder (within the meaning of Section 871(h)(3)(B) of the
Internal Revenue Code) of the Borrower and is not a controlled foreign
corporation related to the Borrower (within the meaning of Section 864(d)(4) of
the Internal Revenue Code), as appropriate. If the forms provided by a Lender
Party at the time such Lender Party first becomes a party to this Agreement
indicate a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from Taxes unless and
until such Lender Party provides the appropriate forms certifying that a lesser
rate applies, whereupon withholding tax at such lesser rate only shall be
considered excluded from Taxes for periods governed by such forms; provided,
however, that if, at the effective date of the Assignment and Acceptance
pursuant to which a Lender Party becomes a party to this Agreement, the Lender
Party assignor was entitled to payments under subsection (a) of this Section
2.12 in respect of United States withholding tax with respect to interest paid
at such date, then, to such extent, the term Taxes shall include (in addition to
withholding taxes that may be imposed in the future or other amounts otherwise
includable in Taxes) United States withholding tax, if any, applicable with
respect to the Lender Party assignee on such date. If any form or document
referred to in this subsection (e) requires the disclosure of information, other
than information necessary to compute the tax payable and information required
on the date hereof by Internal Revenue Service form W-8BEN or W-8ECI (or the
related certificate described above), that the Lender Party reasonably considers
to be confidential, the Lender Party shall give notice thereof to the Borrower
and shall not be obligated to include in such form or document such confidential
information.
(f) For any period with respect to which a Lender Party has
failed to provide the Borrower with the appropriate form described in subsection
(e) above (other than if such failure is due to a change in law occurring after
the date on which a form originally was required to be provided or if such form
otherwise is not required under subsection (e) above), such Lender Party shall
not be entitled to indemnification under subsection (a) or (c) of this Section
2.12 with respect to Taxes imposed by the United States by reason of such
failure; provided, however, that should a Lender Party become subject to Taxes
because of its failure to deliver a form required hereunder, the Borrower shall
take (solely at such Lender Party's expense) such steps as such Lender Party
shall reasonably request to assist such Lender Party to recover such Taxes.
(g) If a Lender Party or an Agent files a claim for refund and
such party determines in its sole discretion that such claim for refund is in
respect of Taxes or Other Taxes as to which it has been indemnified by the
Borrower, or with respect to which any Loan Party has made payments pursuant to
this Section 2.12, such Lender Party or Agent shall promptly notify the Borrower
in writing of the availability of such refund claim. If a Lender Party or an
Agent receives a refund and determines in its sole discretion that such refund
is in respect of any such Taxes or Other Taxes, such Lender Party or Agent shall
42
within 45 days from the date of such receipt or realization pay over the amount
of such refund to the Borrower (but only to the extent of indemnity payments
made or other amounts paid by the Borrower or other Loan Party under this
Section 2.12 with respect to such Taxes or Other Taxes), net of all reasonable
out-of-pocket expenses of such Lender Party or Agent and without interest;
provided that the Borrower (upon written request of such Lender Party or Agent)
agrees to repay the amount paid over to the Borrower to such Lender Party or
Agent in the event such Lender Party or Agent is required to repay such refund
to such governmental authority.
SECTION 2.13 Sharing of Payments, Etc. If any Lender Party shall obtain
at any time any payment (whether voluntary, involuntary, through the exercise of
any right of set-off, or otherwise, other than as a result of an assignment
pursuant to Section 9.06) (a) on account of Obligations due and payable to such
Lender Party hereunder and under the Notes at such time in excess of its ratable
share (according to the proportion of (i) the amount of such Obligations due and
payable to such Lender Party at such time to (ii) the aggregate amount of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time) of payments on account of the Obligations due and payable to all
Lender Parties hereunder and under the Notes at such time obtained by all the
Lender Parties at such time or (b) on account of Obligations owing (but not due
and payable) to such Lender Party hereunder and under the Notes at such time in
excess of its ratable share (according to the proportion of (i) the amount of
such Obligations owing to such Lender Party at such time to (ii) the aggregate
amount of the Obligations owing (but not due and payable) to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations owing (but not due and payable) to all Lender Parties hereunder and
under the Notes at such time obtained by all of the Lender Parties at such time,
such Lender Party shall forthwith purchase from the other Lender Parties such
interests or participating interests in the Obligations due and payable or owing
to them, as the case may be, as shall be necessary to cause such purchasing
Lender Party to share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender Party, such purchase from each other
Lender Party shall be rescinded and such other Lender Party shall repay to the
purchasing Lender Party the purchase price to the extent of such Lender Party's
ratable share (according to the proportion of (i) the purchase price paid to
such Lender Party to (ii) the aggregate purchase price paid to all Lender
Parties) of such recovery together with an amount equal to such Lender Party's
ratable share (according to the proportion of (i) the amount of such other
Lender Party's required repayment to (ii) the total amount so recovered from the
purchasing Lender Party) of any interest or other amount paid or payable by the
purchasing Lender Party in respect of the total amount so recovered ; provided
further that, so long as the Obligations under the Loan Documents shall not have
been accelerated, any excess payment received by any Appropriate Lender shall be
shared on a pro rata basis only with other Appropriate Lenders. The Borrower
agrees that any Lender Party so purchasing an interest or participating interest
from another Lender Party pursuant to this Section 2.13 may, to the fullest
extent permitted by law, exercise all its rights of payment (including the right
of set-off) with respect to such interest or participating interest, as the case
may be, as fully as if such Lender Party were the direct creditor of the
Borrower in the amount of such interest or participating interest, as the case
may be.
SECTION 2.14 Use of Proceeds. The proceeds of the Working Capital
Advances and issuances of Letters of Credit shall be available (and the Borrower
agrees that it shall use such proceeds and Letters of Credit) solely for working
capital, capital expenditures and other general corporate purposes of the
Borrower and its Subsidiaries.
43
SECTION 2.15 Defaulting Lenders. (a) In the event that, at any time,
(i) any Lender Party shall be a Defaulting Lender, (ii) such Defaulting Lender
shall owe a Defaulted Advance to the Borrower and (iii) the Borrower shall be
required to make any payment hereunder or under any other Loan Document to or
for the account of such Defaulting Lender, then the Borrower may, so long as no
Default shall occur or be continuing at such time and to the fullest extent
permitted by applicable law, set off and otherwise apply the Obligation of the
Borrower to make such payment to or for the account of such Defaulting Lender
against the obligation of such Defaulting Lender to make such Defaulted Advance.
In the event that, on any date, the Borrower shall so set off and otherwise
apply its obligation to make any such payment against the obligation of such
Defaulting Lender to make any such Defaulted Advance on or prior to such date,
the amount so set off and otherwise applied by the Borrower shall constitute for
all purposes of this Agreement and the other Loan Documents an Advance by such
Defaulting Lender made on the date of such set-off under the Facility pursuant
to which such Defaulted Advance was originally required to have been made
pursuant to Section 2.01. Such Advance shall be considered, for all purposes of
this Agreement, to comprise part of the Borrowing in connection with which such
Defaulted Advance was originally required to have been made pursuant to Section
2.01, even if the other Advances comprising such Borrowing shall be Eurodollar
Rate Advances on the date such Advance is deemed to be made pursuant to this
subsection (a). The Borrower shall notify the Administrative Agent at any time
the Borrower exercises its right of set-off pursuant to this subsection (a) and
shall set forth in such notice (A) the name of the Defaulting Lender and the
Defaulted Advance required to be made by such Defaulting Lender and (B) the
amount set-off and otherwise applied in respect of such Defaulted Advance
pursuant to this subsection (a). Any portion of such payment otherwise required
to be made by the Borrower to or for the account of such Defaulting Lender which
is paid by the Borrower, after giving effect to the amount set off and otherwise
applied by the Borrower pursuant to this subsection (a), shall be applied by the
Administrative Agent as specified in subsection (b) or (c) of this Section 2.15.
(b) In the event that, at any time, (i) any Lender Party shall
be a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount
to any Agent or any of the other Lender Parties and (iii) the Borrower shall
make any payment hereunder or under any other Loan Document to the
Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of such other Agents or
such other Lender Parties and to the fullest extent permitted by applicable law,
apply at such time the amount so paid by the Borrower to or for the account of
such Defaulting Lender to the payment of each such Defaulted Amount to the
extent required to pay such Defaulted Amount. In the event that the
Administrative Agent shall so apply any such amount to the payment of any such
Defaulted Amount on any date, the amount so applied by the Administrative Agent
shall constitute for all purposes of this Agreement and the other Loan Documents
payment, to such extent, of such Defaulted Amount on such date. Any such amount
so applied by the Administrative Agent shall be retained by the Administrative
Agent or distributed by the Administrative Agent to such other Agents or such
other Lender Parties, ratably in accordance with the respective portions of such
Defaulted Amounts payable at such time to the Administrative Agent, such other
Agents and such other Lender Parties and, if the amount of such payment made by
the Borrower shall at such time be insufficient to pay all Defaulted Amounts
owing at such time to the Administrative Agent, such other Agents and such other
Lender Parties, in the following order of priority:
44
(i) first, to the Agents for any Defaulted Amounts
then owing to the Agents, ratably in accordance with such
respective Defaulted Amounts then owing to the Agents;
(ii) second, to the Issuing Bank for any Defaulted
Amounts then owing to them, ratably in accordance with such
respective Defaulted Amounts then owing to the Issuing Bank;
and
(iii) third, to any other Lender Parties for any
Defaulted Amounts then owing to such other Lender Parties,
ratably in accordance with such respective Defaulted Amounts
then owing to such other Lender Parties.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.15.
(c) In the event that, at any time, (i) any Lender Party shall
be a Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
Advance or a Defaulted Amount and (iii) the Borrower, any Agent or any other
Lender Party shall be required to pay or distribute any amount hereunder or
under any other Loan Document to or for the account of such Defaulting Lender,
then the Borrower or such Agent or such other Lender Party shall pay such amount
to the Administrative Agent to be held by the Administrative Agent, to the
fullest extent permitted by applicable law, in escrow or the Administrative
Agent shall, to the fullest extent permitted by applicable law, hold in escrow
such amount otherwise held by it. Any funds held by the Administrative Agent in
escrow under this subsection (c) shall be deposited by the Administrative Agent
in an account with Wachovia, in the name and under the control of the
Administrative Agent, but subject to the provisions of this subsection (c). The
terms applicable to such account, including the rate of interest payable with
respect to the credit balance of such account from time to time, shall be
Wachovia's standard terms applicable to escrow accounts maintained with it. Any
interest credited to such account from time to time shall be held by the
Administrative Agent in escrow under, and applied by the Administrative Agent
from time to time in accordance with the provisions of, this subsection (c). The
Administrative Agent shall, to the fullest extent permitted by applicable law,
apply all funds so held in escrow from time to time to the extent necessary to
make any Advances required to be made by such Defaulting Lender and to pay any
amount payable by such Defaulting Lender hereunder and under the other Loan
Documents to the Administrative Agent or any other Lender Party, as and when
such Advances or amounts are required to be made or paid and, if the amount so
held in escrow shall at any time be insufficient to make and pay all such
Advances and amounts required to be made or paid at such time, in the following
order of priority:
(i) first, to the Agents for any amounts then due and
payable by such Defaulting Lender to the Agents hereunder,
ratably in accordance with such amounts then due and payable
to the Agents;
45
(ii) second, to the Issuing Bank for any amounts then
due and payable to them hereunder, by such Defaulting Lender,
ratably in accordance with such respective amounts then due
and payable to the Issuing Bank;
(iii) third, to any other Lender Parties for any
amount then due and payable by such Defaulting Lender to such
other Lender Parties hereunder, ratably in accordance with
such respective amounts then due and payable to such other
Lender Parties; and
(iv) fourth, to the Borrower for any Advance then
required to be made by such Defaulting Lender pursuant to a
Commitment of such Defaulting Lender.
In the event that any Lender Party that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Administrative
Agent in escrow at such time with respect to such Lender Party shall be
distributed by the Administrative Agent to such Lender Party and applied by such
Lender Party to the Obligations owing to such Lender Party at such time under
this Agreement and the other Loan Documents ratably in accordance with the
respective amounts of such Obligations outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under
this Section 2.15 are in addition to other rights and remedies that the Borrower
may have against such Defaulting Lender with respect to any Defaulted Advance
and that any Agent or any Lender Party may have against such Defaulting Lender
with respect to any Defaulted Amount.
SECTION 2.16 Priority and Liens.
(a) The Borrower and each of the Subsidiary Guarantors hereby
covenants, represents and warrants that the Obligations of the Borrower and the
Subsidiary Guarantors hereunder and under the Loan Documents and in respect of
Debt permitted by Section 5.02(c)(iv): (i) pursuant to section 364(c)(1) of the
Bankruptcy Code, shall at all times constitute an allowed Superpriority Claim;
(ii) pursuant to section 364(c)(2) of the Bankruptcy Code, shall at all times be
secured by a perfected first priority Lien on all unencumbered property of the
Borrower and the Subsidiary Guarantors that is unencumbered on the Petition Date
and on any unencumbered cash and cash equivalents maintained in any L/C Cash
Collateral Account or the Cash Concentration Account and any investments of the
funds contained therein; (iii) pursuant to section 364(c)(3) of the Bankruptcy
Code, shall be secured by a perfected Lien upon all property of the Borrower and
the Subsidiary Guarantors that is subject to valid, perfected and unavoidable
Liens in existence on the Petition Date or to valid Liens in existence on the
Petition Date that are perfected subsequent to the Petition Date as permitted by
section 546(b) of the Bankruptcy Code or to Permitted Liens, junior to such
valid, perfected and unavoidable Liens; and (iv) pursuant to section 364(d)(1)
of the Bankruptcy Code, shall be secured by a perfected and unavoidable first
priority, senior priming Lien on all of the tangible and intangible property of
the Borrower and the Subsidiary Guarantors (including without limitation,
accounts receivable, inventory, patents, copyrights, trademarks, tradenames and
all other intellectual property, and the capital stock of all direct
subsidiaries of the Borrower and each Subsidiary Guarantor and the proceeds
thereof) that is subject to existing Liens that presently secure the Borrower's
and the Subsidiary Guarantors' pre-petition Debt under the Existing Agreement
(but subject to any Liens in existence on the Petition Date to which the Liens
being primed hereby are subject or become subject subsequent to the Petition
Date as permitted by section 546(b) of the Bankruptcy Code) and the Adequate
46
Protection Liens, subject and subordinated in each case with respect to clauses
(i) through (iv) above, only to the Carve Out. Except for the Carve Out having
priority over the Obligations, the Superpriority Claims shall at all times be
senior to the rights of the Borrower, the Subsidiary Guarantors, any chapter 7
trustee, or any other creditor (including, without limitation, post-petition
counterparties and other post-petition creditors) in the Cases or any subsequent
proceedings under the Bankruptcy Code, including, without limitation, any
chapter 7 cases if any of the Borrower's or the Subsidiary Guarantors' cases are
converted to cases under chapter 7 of the Bankruptcy Code.
(b) As to all real property the title to which is held by any
Borrower or any of the Subsidiary Guarantors, or the possession of which is held
by any Borrower or any of the Subsidiary Guarantors pursuant to leasehold
interest, the Borrower and each Subsidiary Guarantor hereby assigns and conveys
as security, grants a security interest in, hypothecates, mortgages, pledges and
sets over unto the Collateral Agent on behalf of the Secured Parties all of the
right, title and interest of such Borrower and such Subsidiary Guarantor in all
of such owned real property and in all such leasehold interests, together in
each case with all of the right, title and interest of such Borrower and such
Subsidiary Guarantor in all of such owned real property and in all such
leasehold interests, together in each case with all of the right, title and
interest of such Borrower and such Subsidiary Guarantor in and to all buildings,
improvements, and fixtures related thereto, any lease or sublease thereof, all
general intangibles relating thereto and all proceeds thereof. The Borrower and
each Subsidiary Guarantor acknowledges that, pursuant to the Orders the Liens in
favor of the Collateral Agent on behalf of the Secured Parties in all of such
real property and leasehold instruments shall be perfected without the
recordation of any instruments of mortgage or assignment. The Borrower and each
Subsidiary Guarantor further agrees that each such Borrower and such Subsidiary
Guarantor shall, on or before March 31, 2003, record the Interim Order in each
jurisdiction where the properties identified on Schedule 4.01(x) are located on
terms satisfactory to the Collateral Agent.
SECTION 2.17 Right of Set-off. Subject to the provisions of Section
6.01, upon and during the continuance of any Event of Default, each Agent, each
Lender and each Affiliate of each Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law and without further
order of or application to the Bankruptcy Court, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by each such Agent, each such
Lender or each Affiliate thereof to or for the credit or the account of any
Borrower or any Subsidiary Guarantor against any and all of the obligations of
such Borrower or such Subsidiary Guarantor now or hereafter existing under the
Loan Documents, irrespective of whether or not such Agent, such Lender or such
Affiliate shall have made any demand under any Loan Document and although such
obligations may not have been accelerated. Each Agent and each Lender agrees
promptly to notify the Borrower and the Subsidiary Guarantors after any such
set-off and application made by such Agent or such Lender or Affiliate thereof,
as the case may be; provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender
and each Agent under this Section are in addition to other rights and remedies
that such Lender or such Agent may have upon the occurrence and during the
continuance of any Event of Default.
47
SECTION 2.18 Security Interest in L/C Cash Collateral Accounts.
Pursuant to section 364(c)(2) of the Bankruptcy Code, the Borrower and the
Subsidiary Guarantors hereby assign and pledge to the Collateral Agent, for its
benefit and for the ratable benefit of the Secured Parties, and hereby grant to
the Collateral Agent, for its benefit and for the ratable benefit of the Secured
Parties, a first priority security interest, senior to all other Liens, if any,
in all of the Borrower's and the Subsidiary Guarantors' right, title and
interest in and to each L/C Cash Collateral Account and direct investment of the
funds contained therein. Cash held in a L/C Cash Collateral Account shall not be
available for use by any Borrower, whether pursuant to section 363 of the
Bankruptcy Code or otherwise.
SECTION 2.19 Payment of Obligations. Subject to the provisions of
Section 6.01, upon the maturity (whether by acceleration or otherwise) of any of
the Obligations under this Agreement or any of the other Loan Documents of the
Borrower and the Subsidiary Guarantors, the Lenders shall be entitled to
immediate payment of such Obligations without further application to or order of
the Bankruptcy Court.
SECTION 2.20 No Discharge: Survival of Claims. Each of the Borrower and
the Subsidiary Guarantors agrees that (i) its obligations hereunder shall not be
discharged by the entry of an order confirming any Plan of Reorganization (and
each of the Borrower and the Guarantors, pursuant to section 1141(d)(4) of the
Bankruptcy Code, hereby irrevocably waives any such discharge) and (ii) the
Superpriority Claim granted to the Lenders pursuant to the Orders and described
in Section 2.16 and the Liens granted to the Administrative Agent pursuant to
such Orders and described in Sections 2.16 and 2.18 shall not be affected in any
manner by the entry of an order confirming any Plan of Reorganization.
SECTION 2.21 Use of Cash Collateral. Notwithstanding anything to the
contrary contained herein, the Borrower shall not be permitted (i) to request a
Borrowing under Section 2.02 or request the issuance of a Letter of Credit under
Section 2.03 unless the Bankruptcy Court shall have entered the Interim Order or
(ii) to request a Borrowing under Section 2.02 unless the Borrower and the
Subsidiary Guarantors shall at that time have the use of all cash collateral
subject to the Orders for the purposes described in Section 2.14.
ARTICLE III
CONDITIONS OF LENDING AND
ISSUANCES OF LETTERS OF CREDIT
SECTION 3.01 Conditions Precedent to Initial Extension of Credit. The
obligation of each Lender to make an Advance or of the Issuing Bank to issue a
Letter of Credit on the occasion of the Initial Extension of Credit hereunder is
subject to the satisfaction of the following conditions precedent before or
concurrently with the Initial Extension of Credit:
(a) The Administrative Agent shall have received on or before
the day of the Initial Extension of Credit the following, each dated such day
(unless otherwise specified), in form and substance satisfactory to the Lender
Parties (unless otherwise specified) and (except for the Notes) in sufficient
copies for each Lender Party:
48
(i) The Note payable to the order of the Lenders;
(ii) A security agreement in substantially the form
of Exhibit F hereto (together with each other security
agreement and security agreement supplement delivered pursuant
to Section 5.01(j), in each case as amended, the "Security
Agreement"), duly executed by each Loan Party, together with
each of the following:
(A) Certificates representing Pledged Shares referred
to therein accompanied by undated stock powers executed in
blank and instruments evidencing the Pledged Debt indorsed in
blank (to the extent not previously delivered to the
Collateral Agent under the Existing Agreement);
(B) executed copies of proper financing statements,
to be filed under the Uniform Commercial Code of all
jurisdictions that the Administrative Agent may reasonably
deem necessary or desirable in order to perfect and protect
the first priority liens and security interests created under
the Security Agreement, covering the Collateral described in
the Security Agreement;
(C) Evidence of the completion of all other
recordings and filings of or with respect to the Security
Agreement that the Administrative Agent may reasonably deem
necessary or desirable in order to perfect and protect the
Liens created thereby;
(D) Evidence of the insurance required by the terms
of the Security Agreement; and
(E) evidence that all other action that the
Administrative Agent may deem necessary or desirable in order
to perfect and protect the first priority liens and security
interest created under the Security Agreement has been taken.
(iii) Certified copies of the resolutions of the
Board of Directors of each Loan Party approving the
transactions contemplated by the Loan Documents and each Loan
Document to which it is or is to be a party, and of all
documents evidencing other necessary corporate action and
governmental and other third-party approvals and consents, if
any, with respect to the transactions contemplated by the Loan
Documents and each Loan Document to which it is or is to be a
party.
(iv) A copy of a certificate of the Secretary of
State of the jurisdiction of incorporation of each Loan Party,
dated reasonably near the date of the Initial Extension of
Credit, certifying (A) as to a true and correct copy of the
charter of such Loan Party and each amendment thereto on file
in such Secretary's office and (B) that (1) such amendments
are the only amendments to such Loan Party's charter on file
in such Secretary's office, (2) such Loan Party has paid all
franchise taxes to the date of such certificate and (C) such
Loan Party is duly incorporated and in good standing or
presently subsisting under the laws of the state of the
jurisdiction of its incorporation.
49
(v) A certificate of each Loan Party signed on behalf
of such Loan Party by its Chief Executive Officer or a Senior
Vice President and its Secretary or any Assistant Secretary,
dated the date of the Initial Extension of Credit (the
statements made in which certificate shall be true on and as
of the date of the Initial Extension of Credit), certifying as
to (A) the absence of any amendments to the charter of such
Loan Party since the date of the Secretary of State's
certificate referred to in Section 3.01(a)(iv), (B) a true and
correct copy of the bylaws of such Loan Party as in effect on
the date on which the resolutions referred to in Section
3.01(a)(iii) were adopted and on the date of the Initial
Extension of Credit, (C) the due incorporation and good
standing or valid existence of such Loan Party as a
corporation organized under the laws of the jurisdiction of
its incorporation, and the absence of any proceeding for the
dissolution or liquidation of such Loan Party, (D) the truth
of the representations and warranties contained in the Loan
Documents as though made on and as of the date of the Initial
Extension of Credit and (E) the absence of any event occurring
and continuing, or resulting from the Initial Extension of
Credit, that constitutes a Default.
(vi) A certificate of the Secretary or an Assistant
Secretary of each Loan Party certifying the names and true
signatures of the officers of such Loan Party authorized to
sign each Loan Document to which it is or is to be a party and
the other documents to be delivered hereunder and thereunder.
(vii) Such financial, business and other information
regarding each Loan Party and its Subsidiaries as the Lender
Parties shall have requested, including, without limitation,
information as to possible contingent liabilities, tax
matters, environmental matters, obligations under Plans,
Multiemployer Plans and Welfare Plans, collective bargaining
agreements and other arrangements with employees, audited
annual financial statements dated December 31, 2001, interim
financial statements dated September 30, 2002, the end of the
most recent fiscal quarter for which financial statements are
available (or, in the event the Lender Parties' due diligence
review reveals material changes since such financial
statements, as of a later date within 45 days of the day of
the Initial Extension of Credit) and forecasts prepared by
management of the Borrower, in form and substance satisfactory
to the Lender Parties, of balance sheets, income statements
and cash flow statements on a quarterly basis for the twelve
months following the day of the Initial Extension of Credit.
(viii) Evidence of insurance naming the Collateral
Agent as additional insured and loss payee with such
responsible and reputable insurance companies or associations,
and in such amounts and covering such risks, as is
satisfactory to the Administrative Agent, including, without
limitation, business interruption insurance.
(ix) Copies of all Material Contracts of each Loan
Party and its Subsidiaries.
50
(x) A favorable opinion of Hunton & ▇▇▇▇▇▇▇▇, counsel
for the Loan Parties, in substantially the form of Exhibit H
hereto and as to such other matters as any Lender Party
through the Administrative Agent may reasonably request.
(b) At the time of the making of the initial Advances or at
the time of the issuance of the initial Letters of Credit, whichever first
occurs, the Administrative Agent and the Lenders shall have received a certified
copy of an order of the Bankruptcy Court in the form of Exhibit G (the "Interim
Order") approving the Loan Documents and granting the Superpriority Claim status
and the Liens described in Section 2.16 which Interim Order (i) shall have been
entered upon an application or motion of the Borrower and the Subsidiary
Guarantors reasonably satisfactory in form and substance to the Administrative
Agent, on such prior notice to such parties as may in each case be reasonably
satisfactory to the Administrative Agent, (ii) shall authorize extensions of
credit in amounts satisfactory to the Administrative Agent, (iii) shall approve
the payment by the Borrower and the Subsidiary Guarantors of all of the Fees
referred to in Section 2.08(c), (iv) shall be in full force and effect, (v)
shall have authorized the use by the Borrower and the Subsidiary Guarantors of
any cash collateral in which any Existing Lender under the Existing Agreement
may have an interest and shall have provided for the benefit of the Existing
Lenders, as adequate protection for the use of such cash collateral and the
priming contemplated thereby, for (A) a superpriority claim as contemplated by
section 507(b) of the Bankruptcy Code immediately junior to the claims under
section 364(c)(1) of the Bankruptcy Code held by the Agent and the Lenders, (B)
a Lien on the Collateral having a priority immediately junior to the priming and
other Liens granted in favor of the Agent and the Lenders hereunder and under
the other Loan Documents, (C) the current monthly payment to the Existing
Lenders under the Existing Agreement of interest (and the payment of all
interest and fees that are accrued and unpaid on the Petition Date) at the
applicable non-default rates provided for pursuant to the Existing Agreement and
in effect on the Petition Date (which payments and pricing options shall be
without prejudice to the rights of any Existing Lender or letter of credit
issuer to assert a claim for the payment of additional interest calculated at
any other applicable rate of interest, or on any other basis, set forth in the
Existing Agreement), (D) the payment on a current basis of the fees and
disbursements of respective professionals (including, but not limited to, the
fees and disbursements of counsel and internal and third-party consultants,
including financial consultants and auditors) for the Pre-Petition Agent
(including the payment on the Effective Date or as soon thereafter as is
practicable of any unpaid pre-petition fees and expenses) and the continuation
of the payment to the Pre-Petition Agent on a current basis of the
administration and collateral agent fees that are provided for under the
Existing Agreement and (E) the payment to the Existing Lenders, after compliance
with Section 2.06(b) of any Remaining Reduction Amount, and (vi) shall not have
been stayed, reversed, modified or amended in any respect; and, if the Interim
Order is the subject of a pending appeal in any respect, neither the making of
such Advances nor the issuance of such Letter of Credit nor the performance by
any of the Borrower or the Subsidiary Guarantors of any of their respective
obligations hereunder or under the Loan Documents or under any other instrument
or agreement referred to herein shall be the subject of a presently effective
stay pending appeal.
(c) All of the "first day orders" entered by the Bankruptcy
Court at the time of the commencement of the Cases shall be satisfactory in form
and substance to the Administrative Agent.
51
(d) Before giving effect to the transactions contemplated by
the Loan Documents, there shall have occurred no Material Adverse Change since
the Petition Date.
(e) Except for the Cases, there shall exist no action, suit,
investigation, litigation or proceeding affecting any Loan Party or any of its
Subsidiaries pending or threatened before any court, governmental agency or
arbitrator that (i) could be reasonably be expected to have a Material Adverse
Effect or (ii) purports to affect the legality, validity or enforceability of
any Loan Document.
(f) All governmental and third-party consents and approvals
necessary in connection with the Loan Documents shall have been obtained
(without the imposition of any conditions that are not acceptable to the Lender
Parties) and shall remain in effect (other than as set forth on Schedule
4.01(d)).
(g) The Borrower shall have paid all accrued fees of the
Agents and the Lender Parties and all accrued expenses of the Agents (including
the accrued fees and expenses of counsel to the Administrative Agent and local
counsel to the Administrative Agent) for which the Borrower has received an
invoice.
(h) The Administrative Agent and the Lenders shall have
received, and the Administrative Agent shall have approved, the Final Budget and
the Financial Forecasts Report from the Borrower and the Subsidiary Guarantors.
(i) Each of the Non-filing Subsidiaries shall be
Subsidiary Guarantors under the Existing Agreement.
SECTION 3.02 Conditions Precedent to Each Borrowing and Issuance. The
obligation of the Lenders to make each Advance and of the Issuing Bank to issue
each Letter of Credit, including the initial Advance and the initial Letter of
Credit (other than a Letter of Credit Advance deemed made by the Issuing Bank
pursuant to Section 2.03(c)), shall be subject to the further conditions
precedent that on the date of such Borrowing or issuance:
(a) the following statements shall be true and the
Administrative Agent shall have received for the account of such Lender or the
Issuing Bank a certificate signed by a duly authorized officer of the Borrower,
dated the date of such Borrowing or issuance, stating that (and each of the
giving of the applicable Notice of Borrowing or Notice of Issuance and the
acceptance by the Borrower of the proceeds of such Borrowing or of such Letter
of Credit shall constitute a representation and warranty by the Borrower that
both on the date of such notice and on the date of such Borrowing or issuance
such statements are true):
(i) the representations and warranties contained in
each Loan Document are correct in all material respects on and
as of such date, before and after giving effect to such
Borrowing or issuance or renewal and to the application of the
proceeds therefrom, as though made on and as of such date,
other than any such representations or warranties that, by
their terms, refer to a specific date other than the date of
such Borrowing or issuance or renewal, in which case as of
such specific date;
52
(ii) no Default has occurred and is continuing, or
would result from such Borrowing or issuance or renewal or
from the application of the proceeds therefrom; and
(iii) the relevant Cash Report shall reflect cash on
hand (after giving effect to such Borrowing and to any
proposed disbursements over the succeeding five (5) Business
Days commencing on the first Business Day after the date of
delivery of the applicable Notice of Borrowing) of not more
than $5,000,000.
(b) The Interim Order shall be in full force and effect and
shall not have been stayed, reversed, modified or amended in any respect without
the prior written consent of the Administrative Agent and the Required Lenders,
provided, that at the time of the making of any Advance or the issuance of any
Letter of Credit the aggregate amount of either or which, when added to the
aggregate principal amount of Advances outstanding at such time, would exceed
the amount authorized by the Interim Order (collectively, the "Additional
Credit"), the Administrative Agent and each of the Lenders shall have received a
certified copy of an order of the Bankruptcy Court acceptable to the
Administrative Agent in its sole discretion (the "Final Order"), which, in any
event, shall have been entered by the Bankruptcy Court no later than 25 days
after the entry of the Interim Order, and at the time of the extension of any
Additional Credit, the Final Order shall be in full force and effect, and shall
not have been stayed, reversed, modified or amended in any respect without the
prior written consent of the Administrative Agents and the Required Lenders; and
if either the Interim Order or the Final Order is the subject of a pending
appeal in any respect, neither the making of the Advances nor the issuance of
any Letter of Credit nor the performance by any Borrower or any Subsidiary
Guarantor of any of their respective obligations under any of the Loan Documents
shall be the subject of a presently effective stay pending appeal.
(c) The Administrative Agent and each of the Lenders shall
have received at the time of delivery of the Notice of Borrowing in respect of
such proposed Borrowing a certificate of the Chief Financial Officer of the
Borrower containing (A) a report in the form of Exhibit J hereto (each such
report, a "Cash Report") and (B) certifying that all of the cash receipts, the
disbursements and the proposed disbursements of cash set forth in such Cash
Report have occurred or will occur in the ordinary course of business,
consistent with past practices and are or will be in accordance with the Loan
Documents.
(d) The Borrower shall have paid all accrued and payable fees
of the Agents and the Lender Parties and all accrued and payable expenses of the
Agents (including the accrued and payable fees and expenses of counsel and
consultants to the Administrative Agent and local counsel to the Administrative
Agent billed on a monthly basis).
(e) The Borrower shall have paid all accrued and payable fees
of the Pre-Petition Agent and the Pre-Petition Lenders and all accrued and
payable expenses of the Pre-Petition Agent (including the accrued and payable
fees and expenses of counsel and consultants to the Pre-Petition Agent billed on
a monthly basis) pursuant to Orders and the Existing Agreement.
53
(f) At the time of the making of the first Advance or the
issuance of the first Letter of Credit in each case following the entry of the
Final Order, the Administrative Agent shall have received UCC searches conducted
in each jurisdiction that the Administrative Agent reasonably deems necessary or
desirable (dated as of a date reasonably satisfactory to the Administrative
Agent), reflecting the absence of Liens and encumbrances on the assets of the
Borrower and the Guarantors other than such Liens as may be satisfactory to the
Administrative Agent.
(g) The uses of the proceeds of such Borrowing or issuance of
such Letter of Credit shall be (i) in compliance with Section 2.14 and (ii)
substantially consistent with the Final Budget.
(h) Administrative Agent shall have received such other
approvals, opinions or documents as any Appropriate Lender through the
Administrative Agent may reasonably request. (i) After giving effect to such
Borrowing or issuance, the Aggregate Outstanding Amount shall not exceed the
lesser of the Maximum Facility Amount and the Cap Amount.
SECTION 3.03 Determinations Under Section 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lender Parties unless an
officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
Party prior to the Initial Extension of Credit specifying its objection thereto
and, if the Initial Extension of Credit consists of a Borrowing, such Lender
Party shall not have made available to the Administrative Agent such Lender
Party's ratable portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Representations and Warranties of the Borrower.The
Borrower and each Subsidiary Guarantor represents and warrants as follows:
(a) Each Loan Party and each of its Subsidiaries (i) is a
corporation, partnership or limited liability company (as applicable) duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization, (ii) is duly qualified and in
good standing as a foreign corporation, limited partnership or limited liability
company (as applicable) in each other jurisdiction in which it owns or leases
property or in which the conduct of its business requires it to so qualify or be
licensed except where the failure to so qualify or be licensed could not be
reasonably likely to have a Material Adverse Effect, (iii) subject to the entry
by the Bankruptcy Court of the Interim Order (or the Final Order, when
applicable), has the requisite corporate or other organizational power and
authority to effect the transactions contemplated hereby, and by the other Loan
54
Documents to which it is a party and (iv) subject to the entry by the Bankruptcy
Court of the Interim Order (or the Final Order, when applicable), has all
requisite corporate or other organizational power and authority (including,
without limitation, all governmental licenses, permits and other approvals,
other than those set forth in Schedule 4.01(d)) to own or lease and operate its
properties and to carry on its business as now conducted and as proposed to be
conducted.
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of each Loan Party, showing as of the date
hereof (as to each such Subsidiary) the jurisdiction of its incorporation or
organization, the number of shares (or other units) of each class of its Equity
Interests authorized, and the number outstanding, on the date hereof and the
percentage of each such class of its Equity Interests owned (directly or
indirectly) by such Loan Party and the number of shares (or other units) covered
by all outstanding options, warrants, rights of conversion or purchase and
similar rights at the date hereof. All of the outstanding Equity Interests in
each Loan Party's Subsidiaries has been validly issued, are fully paid and
non-assessable and are owned by such Loan Party or one or more of its
Subsidiaries free and clear of all Liens, except those created or permitted
under the Collateral Documents.
(c) The execution, delivery and performance by each Loan Party
of each Loan Document to which it is or is to be a party are within such Loan
Party's corporate powers, have been duly authorized by all necessary corporate
action, and do not (i) contravene such Loan Party's charter or bylaws, (ii)
violate any law, rule, regulation (including, without limitation, Regulation U
of the Board of Governors of the Federal Reserve System), order, writ, judgment,
injunction, decree, determination or award, (iii) conflict with or result in the
breach of, or constitute a default under, any contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding on or
affecting any Loan Party, any of its Subsidiaries or any of their properties or
(iv) except for the Liens created under the Orders or the Loan Documents, result
in or require the creation or imposition of any Lien upon or with respect to any
of the properties of any Loan Party or any of its Subsidiaries. No Loan Party or
any of its Subsidiaries is in violation of any such law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award or in breach
of any such contract, loan agreement, indenture, mortgage, deed of trust, lease
or other instrument, the violation or breach of which could be reasonably likely
to have a Material Adverse Effect.
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body or any
other third party is required for (i) the due execution, delivery, recordation,
filing or performance by any Loan Party of any Loan Document to which it is or
is to be a party, (ii) the grant by any Loan Party of the Liens granted by it
pursuant to the Collateral Documents, (iii) the perfection or maintenance of the
Liens created under the Orders or the Collateral Documents (including the
requisite priority thereof set forth in the Orders) or (iv) the exercise by any
Agent or any Lender Party of its rights under the Loan Documents or the remedies
in respect of the Collateral pursuant to the Collateral Documents, except for
the authorizations, approvals, actions, notices and filings listed on Schedule
4.01(d) hereto, all of which (other than as set forth on such Schedule) have
been duly obtained, taken, given or made and are in full force and effect.
55
(e) This Agreement shall have been, and each other Loan
Document when delivered hereunder will have been, duly executed and delivered by
each Loan Party party thereto. This Agreement is, and each other Loan Document
when delivered hereunder will be, the legal, valid and binding obligation of
each Loan Party party thereto, enforceable against such Loan Party in accordance
with its terms.
(f) Except for the Cases, there is no action, suit,
investigation, litigation or proceeding affecting any Loan Party or any of its
Subsidiaries, including any Environmental Action, pending or, to the knowledge
of the Borrower or its Subsidiaries, threatened before any court, governmental
agency or arbitrator that (i) could be reasonably likely to have a Material
Adverse Effect or (ii) purports to affect the legality, validity or
enforceability of any Loan Document.
(g) There are no Liens on any assets of any of the Borrower or
the Subsidiary Guarantors other than: (i) Permitted Liens, (ii) Liens in favor
of the Collateral Agent and the Lenders, (iii) Adequate Protection Liens and
(iv) Liens existing on the Petition Date. None of the Borrower or the Subsidiary
Guarantors are parties to any contract, agreement, lease or instrument the
performance of which, either unconditionally or upon the happening of an event,
will result in or require the creation of a Lien on any assets of any Borrower
or any Guarantor or otherwise result in a violation of this Agreement other than
the Liens granted to the Collateral Agent and the Lenders as provided for in
this Agreement, the other Loan Documents and the Orders.
(h) (i) The Consolidated balance sheet of the Borrower and its
Subsidiaries as at December 31, 2001, and the related Consolidated statement of
income and Consolidated statement of cash flows of the Borrower and its
Subsidiaries for the fiscal year then ended, accompanied by an unqualified
opinion of Ernst & Young LLP, independent public accountants, fairly present the
Consolidated financial condition of the Borrower and its Subsidiaries as at such
date and the Consolidated results of operations of the Borrower and its
Subsidiaries for the period ended on such date, all in accordance with generally
accepted accounting principles applied on a consistent basis, and since December
31, 2001; (ii) there has been no Material Adverse Change and (iii) the
Consolidated balance sheet of the Borrower and its Subsidiaries as at September
30, 2002, and the related Consolidated statement of income and Consolidated
statement of cash flows of the Borrower and its Subsidiaries for the three
fiscal quarters then ended, fairly present the Consolidated financial condition
of the Borrower and its Subsidiaries as at such date and the Consolidated
results of operations of the Borrower and its Subsidiaries for the three fiscal
quarters ended on such date, subject to year-end adjustments and the absence of
footnotes.
(i) The Consolidated forecasted balance sheet, statement of
operations and projected cash flow of the Borrower and its Subsidiaries
delivered to the Lender Parties pursuant to Section 3.01(a)(vii) or 5.03 were
prepared in good faith on the basis of the assumptions stated therein, which
assumptions were fair in light of the conditions existing at the time of
delivery of such forecasts, and represented, at the time of delivery, the
Borrower's reasonable estimate of its future financial performance. Each of the
Final Budget and the Financial Forecasts Report delivered to the Lender Parties
pursuant to Section 3.01(i) was prepared in good faith on the basis of the
56
assumptions stated therein, which assumptions were fair at time of delivery of
such Final Budget or Financial Forecasts Report (as applicable), and represented
at the time of delivery, the Borrower's reasonable estimate with respect to the
items set forth therein.
(j) No information, exhibit or report furnished by or on
behalf of any Loan Party to any Agent or any Lender Party in connection with the
negotiation and syndication of the Loan Documents or pursuant to the terms of
the Loan Documents contained when furnished any untrue statement of a material
fact or omitted to state a material fact necessary to make the statements made
therein in light of the circumstances under which they were made not misleading.
(k) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no proceeds
of any Advance or drawings under any Letter of Credit will be used to purchase
or carry any Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock.
(l) All material policies of insurance of any kind or nature
owned by or issued to the Borrower and the Subsidiary Guarantors, including,
without limitation, policies of life, fire, theft, product liability, public
liability, property damage, other casualty, employee fidelity, workers'
compensation, employee health and welfare, title, property and liability
insurance, are in full force and effect and are of a nature and provide such
coverage as is customarily carried by companies of the size and character of the
Borrower and Subsidiary Guarantors.
(m) On the date of the making of the initial Advances or the
issuance of the initial Letters of Credit hereunder, whichever first occurs, the
Interim Order will have been entered and will not have been stayed, amended,
vacated, reversed or rescinded. On the date of the making of any Advance or
issuance of any Letter of Credit, the Interim Order or the Final Order, as the
case may be, will have been entered and will not have been amended, stayed,
vacated or rescinded.
(n) Neither any Loan Party nor any of its Subsidiaries is an
"investment company", or an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended. Neither the making of any Advances,
nor the issuance of any Letters of Credit, nor the application of the proceeds
or repayment thereof by the Borrower, nor the consummation of the other
transactions contemplated by the Loan Documents, will violate any provision of
such Act or any rule, regulation or order of the Securities and Exchange
Commission thereunder.
(o) Neither any Loan Party nor any of its Subsidiaries is a
party to any indenture, loan or credit agreement or any lease or other agreement
or instrument or subject to any charter or corporate restriction the compliance
with the terms of which could reasonably be expected to have a Material Adverse
Effect.
(p) No claim has been asserted and is pending by any Person
challenging or questioning the use of any Intellectual Property (as defined in
the Security Agreement) or the validity or effectiveness of any Intellectual
Property, nor does any Borrower or any Guarantor know of any such claim, and, to
the knowledge of the Borrower and each Subsidiary Guarantor, the use of such
57
Intellectual Property by the Borrower and the Guarantors does not infringe on
the rights of any Person, except for such claims and infringement that, in the
aggregate, would not be reasonably expected to have a Material Adverse Effect.
(q) The Collateral Documents create a valid and perfected
security interest in the Collateral having the priority set forth in the Interim
Order, securing the payment of the Obligations of the Loan Parties under the
Loan Documents, and all filings and other actions necessary or desirable to
perfect and protect such security interest will have been duly taken. The Loan
Parties are the legal and beneficial owners of the Collateral free and clear of
any Lien, except for the liens and security interests created or permitted under
the Orders and the Loan Documents.
(r) (i) Set forth on Schedule 4.01(r) hereto is a complete
and accurate list of all Plans, Multiemployer Plans and Welfare Plans and a
schedule of all known contributions required under such plans for the period
beginning on the Petition Date and ending on December 31, 2004.
(ii) Other than the filing of the Cases and events
related to such filing, no ERISA Event has occurred or is
reasonably expected to occur with respect to any Plan that has
resulted in or is reasonably expected to result in a material
liability of any Loan Party or any ERISA Affiliate.
(iii) Schedule B (Actuarial Information) to the most
recent annual report (Form 5500 Series) for each Plan for
which a Schedule B must be prepared, copies of which have been
filed with the Internal Revenue Service and furnished to the
Lender Parties, is complete and accurate and fairly presents
the funding status of such Plan, and since the date of such
Schedule B there has been no material adverse change in such
funding status except as set forth on Schedule 4.01(r).
(iv) Neither any Loan Party nor any ERISA Affiliate
has incurred or is reasonably expected to incur any Withdrawal
Liability to any Multiemployer Plan.
(v) Neither any Loan Party nor any ERISA Affiliate
has been notified by the sponsor of a Multiemployer Plan that
such Multiemployer Plan is in reorganization or has been
terminated, within the meaning of Title IV of ERISA, and no
such Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated, within the meaning of
Title IV of ERISA.
(s) (i) The operations and properties of each Loan Party and
each of its Subsidiaries comply in all material respects with all applicable
Environmental Laws and Environmental Permits, all past non-compliance with such
Environmental Laws and Environmental Permits has been resolved without ongoing
obligations or costs, and no circumstances exist that could be reasonably likely
to (A) form the basis of an Environmental Action against any Loan Party or any
of its Subsidiaries or any of their properties that could have a Material
Adverse Effect or (B) cause any such property to be subject to any material
restrictions on ownership, occupancy, use or transferability under any
Environmental Law.
58
(ii) None of the properties currently or formerly
owned or operated by any Loan Party or any of its Subsidiaries
is listed or, to the knowledge of the Borrower or its
Subsidiaries, proposed for listing on the NPL or on the
CERCLIS or any analogous, state or local list, to the
knowledge of the Borrower or its Subsidiaries, or except as
set forth on Schedule 4.01(s) hereto is adjacent to any such
property.
(iii) There are no and, to the knowledge of the
Borrower or its Subsidiaries, never have been any underground
or aboveground storage tanks or any surface impoundments,
septic tanks, pits, sumps or lagoons in which Hazardous
Materials are being or have been treated, stored or disposed
on any property currently owned or operated by any Loan Party
or any of its Subsidiaries or, to the best of its knowledge,
on any property formerly owned or operated by any Loan Party
or any of its Subsidiaries; there is no asbestos or
asbestos-containing material on any property currently owned
or operated by any Loan Party or any of its Subsidiaries; and
Hazardous Materials have not been released, discharged or
disposed of on any property currently or, to the knowledge of
the Borrower or its Subsidiaries, formerly owned or operated
by any Loan Party or any of its Subsidiaries; provided, that
no Loan Party shall be in breach of the representation set
forth in this clause (iii) for environmental conditions that
would not, individually or in the aggregate, have a Material
Adverse Effect.
(iv) Neither any Loan Party nor any of its
Subsidiaries is undertaking, and has not completed, either
individually or together with other potentially responsible
parties, any investigation or assessment or remedial or
response action relating to any actual or threatened release,
discharge or disposal of Hazardous Materials at any site,
location or operation, either voluntarily or pursuant to the
order of any governmental or regulatory authority or the
requirements of any Environmental Law; and all Hazardous
Materials generated, used, treated, handled or stored at, or,
to the knowledge of the Borrower or its Subsidiaries,
transported to or from, any property currently or formerly
owned or operated by any Loan Party or any of its Subsidiaries
have been disposed of in a manner not reasonably expected to
result in a Material Adverse Effect.
(t) (a) Neither any Loan Party nor any of its Subsidiaries is
party to any tax sharing agreement other than a tax sharing agreement approved
by the Required Lenders.
(ii) (x) All material tax returns, statements,
reports and forms (including estimated tax or information
returns) (collectively, the "Tax Returns") required to be
filed with any taxing authority by, or with respect to, each
Loan Party and its Subsidiaries have been timely filed in
accordance with all applicable laws and, as of the time of
filing, each Tax Return was, except as set forth on Schedule
4.01(t), in all material respects accurate and complete and
correctly in all material respects reflected the facts
regarding income, business, assets, operations and the status
of each Loan Party and its Subsidiaries; (y) each Loan Party
and its Subsidiaries have timely paid or made adequate
provision in accordance with GAAP for payment of all taxes
that are shown as due and payable on Tax Returns that have
59
been so filed or that are otherwise required to be paid,
including without limitation, assessments, interest and
penalties (other than taxes which are being contested in good
faith and for which adequate reserves in accordance with GAAP
are reflected on the financial statements delivered hereunder)
and (z) each Loan Party and its Subsidiaries have made
adequate provision in accordance with GAAP for all taxes
payable by such Loan Party and its Subsidiaries for which no
Tax Return has yet been filed or which are otherwise due.
(iii) Set forth on Part I of Schedule 4.01(t) hereto
is a complete and accurate list, as of the date hereof, of
each taxable year of each Loan Party and each of its
Subsidiaries for which Federal income tax returns have been
filed and for which the expiration of the applicable statute
of limitations for assessment or collection has not occurred
by reason of extension or otherwise (an "Open Year").
(iv) Set forth on Part I of Schedule 4.01(t) hereto
is a complete and accurate list, as of the date hereof, of all
open audits, of which any Loan Party is aware or should be
aware of, being conducted by any Federal, state, local or
foreign taxing authority with respect to any Loan Party or any
of its Subsidiaries, and no Loan Party nor any of its
Subsidiaries has received notice of any other pending audits.
(u) Neither the business nor the properties of any Loan Party
or any of its Subsidiaries are affected by any fire, explosion, accident,
strike, lockout or other labor dispute, drought, storm, hail, earthquake,
embargo, act of God or of the public enemy or other casualty (whether or not
covered by insurance) that could be reasonably likely to have a Material Adverse
Effect.
(v) Set forth on Schedule 4.01(v) hereto is a complete and
accurate list as of the Petition Date of all Existing Debt showing the obligor
and the principal amount outstanding thereunder.
(w) Set forth on Schedule 4.01(w) hereto is a complete and
accurate list as of the Petition Date of all Liens on the property or assets of
any Loan Party or any of its Subsidiaries, showing the lienholder thereof, the
principal amount of the obligations secured thereby and the property or assets
of such Loan Party or such Subsidiary subject thereto.
(x) Set forth on Schedule 4.01(x) hereto is a complete and
accurate list of all real property having a capitalized cost on the books of the
Borrower in excess of $100,000 which are owned by any Loan Party or any of its
Subsidiaries, showing as of the Petition Date the street address, county or
other relevant jurisdiction, state, record owner and the capitalized cost
thereof. Each Loan Party or such Subsidiary has good, marketable and insurable
fee simple title to such real property, free and clear of all Liens, other than
Permitted Liens and Liens created or permitted by the Loan Documents.
(y) Set forth on Schedule 4.01(y) hereto is a complete and
accurate list as of the Petition Date of all leases of real property under which
any Loan Party or any of its Subsidiaries is the lessee and under which the
60
lessee is obligated to pay annual rent in excess of $25,000 per year as of the
date of this Agreement, showing the street address, county or other relevant
jurisdiction, state, lessor, lessee, expiration date and annual rental cost
thereof. Each such lease is the legal, valid and binding obligation of the
lessor thereof, enforceable in accordance with its terms.
(z) Set forth on Schedule 4.01(z) hereto is a complete and
accurate list of all Investments held by any Loan Party or any of its
Subsidiaries on the date hereof, showing as of the Petition Date the amount,
obligor or issuer and maturity, if any, thereof.
(aa) Set forth on Schedule 4.01(aa) hereto is a complete and
accurate list as of the Petition Date of all patents, trademarks, trade names,
service marks and copyrights, and all applications therefor and licenses
thereof, of each Loan Party or any of its Subsidiaries, showing the jurisdiction
in which registered, the registration number, the date of registration and the
expiration date.
(bb) Set forth on Schedule 4.01(bb) hereto is a complete and
accurate list as of the Petition Date of all Material Contracts of each Loan
Party and its Subsidiaries, showing the parties, subject matter and term
thereof. Each such Material Contract has been duly authorized, executed and
delivered by all parties thereto, has not been amended or otherwise modified
(except as set forth on Schedule 4.01(bb)), is in full force and effect and is
binding upon and enforceable against all parties thereto in accordance with its
terms, and except as a result of the filing of the Cases and with respect to the
Existing Agreement and the secured hedge agreements that are cross-defaulted to
the Existing Agreement, there exists no default by a Loan Party or, to the
Borrower's knowledge, any other party thereto under any Material Contract.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01 Affirmative Covenants. So long as any Advance or any other
Obligation of any Loan Party under any Loan Document shall remain unpaid, any
Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower and each Guarantor will:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable laws,
rules, regulations and orders, such compliance to include, without limitation,
compliance with ERISA and the Racketeer Influenced and Corrupt Organizations
Chapter of the Organized Crime Control Act of 1970.
(b) Obligations and Taxes. With respect to the Borrower and
each Subsidiary Guarantor, pay all its material obligations arising after the
Petition Date promptly and in accordance with their terms and pay and discharge
promptly all material taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or in respect of its property
arising, or attributed to the period, after the Petition Date, before the same
shall become in default, as well as all material lawful claims for labor,
materials and supplies or otherwise arising after the Petition Date which, if
61
unpaid, would become a Lien or charge upon such properties or any part thereof;
provided, however, that the Borrower and each Subsidiary Guarantor shall not be
required to pay and discharge or to cause to be paid and discharged any such
tax, assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings (if the Borrower and
the Subsidiary Guarantors shall have set aside on their books adequate reserves
therefor in conformity with GAAP).
(c) Compliance with Environmental Laws. Comply, and cause each
of its Subsidiaries and all lessees and other Persons operating or occupying its
properties to comply, in all material respects, with all applicable
Environmental Laws and Environmental Permits; obtain and renew and cause each of
its Subsidiaries to obtain and renew all Environmental Permits necessary for its
operations and properties; and conduct, and cause each of its Subsidiaries to
conduct, any investigation, study, sampling and testing, and undertake any
cleanup, removal, remedial or other action; provided, however, that neither the
Borrower nor any of its Subsidiaries shall be required to undertake any such
cleanup, removal, remedial or other action to the extent that its obligation to
do so is being contested in good faith and appropriate reserves are being
maintained with respect to such circumstances in conformity with GAAP.
(d) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks as is usually
carried by companies engaged in similar businesses and owning similar properties
in the same general areas in which the Borrower or such Subsidiary operates.
(e) Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain, its
existence, legal structure, legal name, rights (charter and statutory), permits,
licenses, approvals, privileges and franchises; provided, however, that the
Borrower and its Subsidiaries may consummate any merger or consolidation
permitted under Section 5.02(e) and provided further neither the Borrower nor
any of its Subsidiaries shall be required to preserve any right, permit,
license, approval, privilege or franchise if the Board of Directors (or
equivalent body) of the Borrower or such Subsidiary shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Borrower or such Subsidiary, as the case may be, and that the loss thereof
is not disadvantageous in any material respect to the Borrower, such Subsidiary
or the Lender Parties.
(f) Visitation Rights. Upon reasonable notice (so long as no
Event of Default exists) from time to time during customary business hours,
permit any of the Agents or any of the Lender Parties, or any agents or
representatives thereof at their own expense (so long as no Event of Default
exists), to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, the Borrower and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of the Borrower
and any of its Subsidiaries with any of their executive officers or directors
and with their independent certified public accountants. The Lender Parties and
the Agents shall make reasonable efforts to coordinate such visits so as to
minimize disruption of the Loan Parties' business.
62
(g) Keeping of Books. Keep, and cause each of its Subsidiaries
to keep, proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the assets and business of the
Borrower and each such Subsidiary in accordance with generally accepted
accounting principles in effect from time to time.
(h) Maintenance of Properties, Etc. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its properties
that are used or useful in the conduct of its business in good working order and
condition, ordinary wear and tear excepted.
(i) Transactions with Affiliates. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under the Loan
Documents with any of their Affiliates on terms that are fair and reasonable and
no less favorable to the Borrower or such Subsidiary than it would obtain in a
comparable arm's-length transaction with a Person not an Affiliate.
(j) Covenant to Guarantee Obligations and Give Security. Upon
(x) the request of the Collateral Agent following the occurrence and during the
continuance of an Event of Default, (y) the formation or acquisition of any new
direct or indirect Subsidiaries by any Loan Party or (z) the acquisition of any
property by any Loan Party, and such property, in the judgment of the Collateral
Agent, shall not already be subject to a perfected first priority security
interest in favor of the Collateral Agent for the benefit of the Secured
Parties, then the Borrower shall, in each case at the Borrower's expense:
(i) in connection with the formation or acquisition
of a Subsidiary, within 30 days after such formation or
acquisition, cause each such Subsidiary, and cause each direct
and indirect parent of such Subsidiary (if it has not already
done so), to duly execute and deliver to the Collateral Agent
a guaranty or guaranty supplement, in form and substance
satisfactory to the Collateral Agent, guaranteeing the other
Loan Parties' obligations under the Loan Documents,
(ii) within 30 days after such request, formation or
acquisition, furnish to the Collateral Agent a description of
the real and personal properties of the Loan Parties and their
respective Subsidiaries in detail satisfactory to the
Collateral Agent,
(iii) within 30 days after such request, formation or
acquisition, duly execute and deliver, and cause each such
Subsidiary and each direct and indirect parent of such
Subsidiary (if it has not already done so) to duly execute and
deliver, to the Collateral Agent mortgages, pledges,
assignments, security agreement supplements and other security
agreements, as specified by and in form and substance
satisfactory to the Collateral Agent, securing payment of all
the Obligations of the applicable Loan Party, such Subsidiary
or such parent, as the case may be, under the Loan Documents
and constituting Liens on all such properties,
(iv) within 30 days after such request, formation or
acquisition, take, and cause such Subsidiary or such parent to
take, whatever action (including, without limitation, the
63
recording of mortgages, the filing of Uniform Commercial Code
financing statements, the giving of notices and the
endorsement of notices on title documents) may be necessary or
advisable in the opinion of the Collateral Agent to vest in
the Collateral Agent (or in any representative of the
Collateral Agent designated by it) valid and subsisting Liens
on the properties purported to be subject to the mortgages,
pledges, assignments, security agreement supplements and
security agreements delivered pursuant to this Section
5.01(j), enforceable against all third parties in accordance
with their terms, (v) within 60 days after such request,
formation or acquisition, deliver to the Collateral Agent,
upon the request of the Collateral Agent in its sole
discretion, a signed copy of a favorable opinion, addressed to
the Collateral Agent and the other Secured Parties, of counsel
for the Loan Parties acceptable to the Collateral Agent as to
the matters contained in clauses (i), (iii) and (iv) above, as
to such guaranties, guaranty supplements, mortgages, pledges,
assignments, security agreement supplements and security
agreements being legal, valid and binding obligations of each
Loan Party party thereto enforceable in accordance with their
terms, as to the matters contained in clause (iv) above, as to
such recordings, filings, notices, endorsements and other
actions being sufficient to create valid perfected Liens on
such properties, and as to such other matters as the
Collateral Agent may reasonably request,
(vi) as promptly as practicable after such request,
formation or acquisition, deliver, upon the request of the
Collateral Agent in its sole discretion, to the Collateral
Agent with respect to each parcel of real property owned or
held by the entity that is the subject of such request,
formation or acquisition title reports, surveys and
engineering, soils and other reports, and environmental
assessment reports, each in scope, form and substance
satisfactory to the Collateral Agent in its reasonable
judgment, provided, however, that to the extent that any Loan
Party or any of its Subsidiaries shall have otherwise received
any of the foregoing items with respect to such real property,
such items shall, promptly after the receipt thereof, be
delivered to the Collateral Agent, and
(vii) as promptly as practicable after such request,
cause to be deposited any and all cash dividends paid or
payable to it or any of its Subsidiaries from any of its
Subsidiaries from time to time into the Cash Concentration
Account, and with respect to all other dividends paid or
payable to it or any of its Subsidiaries from time to time,
promptly execute and deliver, or cause such Subsidiary to
promptly execute and deliver, as the case may be, any and all
further instruments and take or cause such Subsidiary to take,
as the case may be, all such other action as the Collateral
Agent may deem necessary or desirable in order to obtain and
maintain from and after the time such dividend is paid or
payable a perfected, first priority lien on and security
interest in such dividends.
Notwithstanding anything to the contrary contained in this
Section 5.01(j), Virginia Independent Telephone Alliance, L.C. shall not be
subject to this Section 5.01(j) to the extent its organizational documents
prohibit any of the actions contemplated herein.
64
(k) Further Assurances. Promptly upon request by any Agent, or
any Lender Party through the Administrative Agent, do, execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register any and all
such further acts, deeds, conveyances, pledge agreements, mortgages, deeds of
trust, trust deeds, assignments, financing statements and continuations thereof,
termination statements, notices of assignment, transfers, certificates,
assurances and other instruments as any Agent, or any Lender Party through the
Administrative Agent, may reasonably require from time to time in order to (A)
carry out more effectively the purposes of the Loan Documents, (B) to the
fullest extent permitted by applicable law, subject any Loan Party's or any of
its Subsidiaries' properties, assets, rights or interests to the Liens now or
hereafter intended to be covered by any of the Collateral Documents, (C) perfect
and maintain the validity, effectiveness and priority of any of the Collateral
Documents and any of the Liens intended to be created thereunder and (D) assure,
convey, grant, assign, transfer, preserve, protect and confirm more effectively
unto the Secured Parties the rights granted or now or hereafter intended to be
granted to the Secured Parties under any Loan Document or under any other
instrument executed in connection with any Loan Document to which any Loan Party
or any of its Subsidiaries is or is to be a party, and cause each of its
Subsidiaries to do so.
(l) Use of Proceeds. Use the proceeds of the Working Capital
Advances solely for the purposes set forth in Section 2.14. In no event will any
proceeds of any Advances or Letters of Credit be used (i) to make or support any
payment or prepayment that is prohibited under this Agreement, including any
payment or prepayment in respect of Existing Debt to the extent prohibited
hereunder or (ii) to make or support any payment in settlement of any
pre-Petition Date claim, action or proceeding, before any court, arbitrator or
other governmental body other than as permitted by a First Day Order or the
Required Lenders.
(m) Preparation of Environmental Reports. At the request of
the Administrative Agent or the Collateral Agent at any time after a notice of
violation or alleged violation of any applicable Environmental Law (including
any "PRP Letter") has been received by a Loan Party and not finally resolved
pursuant to which the Loan Party is reasonably likely to incur liability in
excess of $100,000, provide to the Lender Parties within 60 days after such
request, at the expense of the Borrower, an environmental site assessment report
for any of its or its Subsidiaries' properties described in such request,
prepared by an environmental consulting firm acceptable to the Administrative
Agent or the Collateral Agent, indicating the presence or absence of Hazardous
Materials and the estimated cost of any compliance, removal or remedial action
in connection with any Hazardous Materials on such properties; without limiting
the generality of the foregoing, if the Administrative Agent or the Collateral
Agent determines at any time that a material risk exists that any such report
will not be provided within the time referred to above, the Administrative Agent
or the Collateral Agent may retain an environmental consulting firm to prepare
such report at the expense of the Borrower, and the Borrower hereby grants and
agrees to cause any Subsidiary that owns any property described in such request
to grant at the time of such request to the Agents, the Lender Parties, such
firm and any agents or representatives thereof an irrevocable non-exclusive
license, subject to the rights of tenants, to enter onto their respective
properties to undertake such an assessment.
(n) Compliance with Terms of Leaseholds. Make all payments and
otherwise perform all obligations in respect of all leases of real property to
which the Borrower or any of its Subsidiaries is a party, keep such leases in
full force and effect and not allow such leases to lapse or be terminated or any
rights to renew such leases to be forfeited or cancelled, notify the
Administrative Agent of any default by any party with respect to such leases and
cooperate with the Administrative Agent in all respects to cure any such
65
default, and cause each of its Subsidiaries to do so, except, in any case, where
the failure to do so, either individually or in the aggregate, could not be
reasonably likely to have a Material Adverse Effect; provided that (x) the
Borrower and the Subsidiary Guarantors shall not be required to comply with this
paragraph (n) with respect to any such lease rejected by the Borrower by an
order of the Bankruptcy Court and (y) the Borrower shall not have breached this
paragraph (n) with respect to any such lease if the Borrower is in default under
any such lease solely as a result of a default thereunder of a kind specified in
section 365(b)(2)(A), (B), (C) or (D) of the Bankruptcy Code.
(o) Performance of Material Contracts. Perform and observe all
the terms and provisions of each Material Contract to be performed or observed
by it, maintain each such Material Contract in full force and effect, enforce
each such Material Contract in accordance with its terms, take all such action
to such end as may be from time to time requested by the Administrative Agent
and, upon request of the Administrative Agent, make upon each other party to
each such Material Contract such demands and requests for information and
reports or for action as any Loan Party or any of its Subsidiaries is entitled
to make under such Material Contract, and cause each of its Subsidiaries to do
so, except, in any case, where the failure to do so, either individually or in
the aggregate, could not be reasonably likely to have a Material Adverse Effect;
provided that (x) the Borrower and the Subsidiary Guarantors shall not be
required to comply with this paragraph (o) with respect to any such Material
Contract rejected by the Borrower by an order of the Bankruptcy Court and (y)
the Borrower shall not have breached this paragraph (o) with respect to any such
Material Contract if the Borrower is in default under any such Material Contract
solely as a result of a default thereunder of a kind specified in section
365(b)(2)(A), (B), (C) or (D) of the Bankruptcy Code.
(p) Conditions Subsequent. Deliver to the Administrative
Agent:
(i) on or before the 90th day after the Effective
Date, evidence that the Interim Order has been duly recorded
in all recording offices listed on Schedule 4.01(x) hereto;
and
(ii) on or before the 10th day after the Effective
Date, a favorable opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, regulatory
counsel to the Loan Parties, verifying the Loan Parties'
holding of FCC Personal Communications Services licenses set
forth on Schedule 5.01(p) in a form satisfactory to the
Administrative Agent.
(q) Limitations on Advances. The Borrower shall not deliver
any Notice of Borrowing, Notice of Issuance or other document, the honoring of
which would result in the Aggregate Outstanding Amount exceeding the lesser of
the Maximum Facility Availability and the Cap Amount.
(r) Dissolution of NTELOS Acquisition Corp. The Borrower shall
dissolve NTELOS Acquisition Corp. on or before March 12, 2003.
66
SECTION 5.02 Negative Covenants. So long as any Advance or any other
Obligation of any Loan Party under any Loan Document shall remain unpaid, any
Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to exist, any
Lien on or with respect to any of its properties of any character (including,
without limitation, accounts) whether now owned or hereafter acquired, or sign
or file or suffer to exist, or permit any of its Subsidiaries to sign or file or
suffer to exist, under the Uniform Commercial Code of any jurisdiction, a
financing statement that names the Borrower or any of its Subsidiaries as
debtor, or sign or suffer to exist, or permit any of its Subsidiaries to sign or
suffer to exist, any security agreement authorizing any secured party thereunder
to file such financing statement, or assign, or permit any of its Subsidiaries
to assign, any accounts or other right to receive income, except (i) Liens which
were existing on the Petition Date and described on Schedule 4.01(w) and Liens
granted pursuant to the Existing Agreement; (ii) Adequate Protection Liens
granted pursuant to the Orders, which Liens are junior to the Liens contemplated
hereby in favor of the Agent and the Lenders, but only so long as the Orders
shall provide that the holder of such Adequate Protection Liens shall not be
permitted to take any action to foreclose with respect to such junior Liens so
long as any amounts shall remain outstanding hereunder or any Commitment shall
remain in effect; (iii) Permitted Liens; (iv) Liens in favor of the Agent and
the Lenders and (v) Liens securing purchase money Debt or Capitalized Leases
permitted by Section 5.02(c)(v) on the assets (but not on any other assets)
purchased with the proceeds of such Debt or subject to such Capitalized Lease,
and such Liens may, at the option of the Borrower, rank senior to, pari passu
with or junior to the Liens securing the Obligations under the Loan Documents.
(b) Chapter 11 Claims. After the Petition Date, incur, create,
assume, suffer to exist or permit any other Superpriority Claim that is pari
passu with or senior to the claims of the Agents and the Lenders against the
Borrower and the Subsidiary Guarantors except with respect to the Carve Out.
(c) Debt. Contract, create, incur, assume or suffer to exist
any Debt, except for (i) Debt under this Agreement and the other Loan Documents,
(ii) Debt incurred prior to the Petition Date, (iii) Debt arising from
Investments among the Borrower and the Subsidiary Guarantors that are permitted
hereunder, (iv) Debt owed to Wachovia Bank, National Association, Branch Banking
and Trust Company, Bank of America or any of their respective Affiliates in
respect of any overdrafts and related liabilities arising from treasury,
depository and cash management services or in connection with any automated
clearing house transfers of funds, (v) Debt incurred subsequent to the Petition
Date the proceeds of which are applied within 10 days after receipt thereof to
acquire fixed or capital assets and Capitalized Leases entered into subsequent
to the Petition Date in an aggregate amount not to exceed $2,500,000 and (vi)
Contingent Obligations consisting of customary indemnity undertakings with
respect to asset sales permitted under Section 5.02(f)(iii).
(d) Change in Nature of Business. Engage, or permit any of its
Subsidiaries to engage, in any business other than a Related Business.
67
(e) Mergers, Etc. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its Subsidiaries to do so,
except that:
(i) any Subsidiary of the Borrower may merge into or
consolidate with any other Subsidiary of the Borrower;
provided that, in the case of any such merger or
consolidation, the Person formed by such merger or
consolidation shall be a wholly owned Subsidiary of the
Borrower; and provided further that, in the case of any such
merger or consolidation to which a Subsidiary Guarantor is a
party, the Person formed by such merger or consolidation shall
be a Subsidiary Guarantor;
(ii) in connection with any acquisition permitted
under Section 5.02(g), any Subsidiary of the Borrower may
merge into or consolidate with any other Person or permit any
other Person to merge into or consolidate with it; provided
that the Person surviving such merger shall be a wholly owned
Subsidiary of the Borrower;
(iii) in connection with any sale or other
disposition permitted under Section 5.02(f) (other than clause
(ii) thereof), any Subsidiary of the Borrower may merge into
or consolidate with any other Person or permit any other
Person to merge into or consolidate with it; and
(iv) any of the Borrower's Subsidiaries may merge
into the Borrower.
provided, however, that in each case, immediately after giving effect thereto,
no event shall occur and be continuing that constitutes a Default and, in the
case of any such merger to which the Borrower is a party, the Borrower is the
surviving corporation.
(f) Sales, Etc., of Assets. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer or
otherwise dispose of, any assets, or grant any option or other right to
purchase, lease or otherwise acquire any assets other than Inventory to be sold
in the ordinary course of its business, except:
(i) sales of Inventory in the ordinary course of its
business;
(ii) in a transaction authorized by Section 5.02(e)
(other than subsection (iii) thereof) or required by Section
5.01(r);
(iii) sales of assets listed on Schedule 5.02(f)(iii)
hereto for cash (subject to customary holdbacks and escrows);
and
(iv) sales or other dispositions of assets
constituting Investments expressly permitted by Section
5.02(g).
provided that, in the case of sales of assets pursuant to clause (iii) above,
the Borrower shall, on the date of receipt by any Loan Party or any of its
Subsidiaries of the Net Cash Proceeds from such sale, prepay the Advances and/or
cash collateralized Letters of Credit pursuant to, and in the amount and order
of priority set forth in, Section 2.06(b)(i), as specified therein; and provided
68
further, that promptly and in no event later than three Business Days after the
date of each sale, lease, transfer or other disposition of assets pursuant to
this Section 5.02(f), the Borrower shall deliver to the Administrative Agent a
certificate of the Chief Financial Officer of the Borrower certifying (A) that
attached to such certificate is a revised Schedule 5.02(f)(iii), reflecting
which transactions on such schedule have been consummated since the Petition
Date and (B) that such sale of assets has occurred in accordance with the terms
of this Section 5.02(f) (and setting forth the percentage of the proceeds of
such sale received in cash and the total consideration received for each single
transaction or series of related transactions).
(g) Investments in Other Persons. Make or hold, or permit any
of its Subsidiaries to make or hold, any Investment in any Person, except:
(i) (x) Investments by the Borrower and its
Subsidiaries in their Subsidiaries outstanding on the Petition
Date;
(ii) Investments by the Borrower and its Subsidiaries
in Cash Equivalents;
(iii) Investments existing on the date hereof and
described on Schedule 4.01(z) hereto;
(iv) loans and advances among the Borrower and the
Subsidiary Guarantors entered into in the ordinary course of
business; and
(v) advances to employees in the ordinary course of
business of the Borrower and its Subsidiaries as conducted
immediately prior to the Petition Date in an aggregate
principal amount not to exceed $250,000 at any time
outstanding.
(h) Restricted Payments. Declare or pay any dividends,
purchase, redeem, retire, defease or otherwise acquire for value any of its
Equity Interests now or hereafter outstanding, return any capital to its
stockholders, partners or members (or the equivalent Persons thereof) as such,
make any distribution of assets, Equity Interests, obligations or securities to
its stockholders, partners or members (or the equivalent Persons thereof) as
such or issue or sell any Equity Interests or accept any capital contributions,
or permit any of its Subsidiaries to do any of the foregoing, or permit any of
its Subsidiaries to purchase, redeem, retire, defease or otherwise acquire for
value any Equity Interests in the Borrower or to issue or sell any Equity
Interests therein, except that, any Subsidiary of the Borrower may (A) declare
and pay cash dividends to the Borrower, (B) declare and pay cash dividends to
any other Loan Party of which it is a Subsidiary and (C) make and receive
investments subject to this subsection (h) to the extent permitted under Section
5.02(g), in each case provided that, immediately prior to and immediately after
such Subsidiary takes any of the actions described in clause (A) through (C), no
Default shall have occurred and be continuing.
(i) Lease Obligations. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any obligations as lessee (i) for the rental or hire of real or personal
property in connection with any sale and leaseback transaction, or (ii) for the
rental or hire of other real or personal property of any kind under leases or
69
agreements to lease (including, without limitation, Capitalized Leases) having
an original term of one year or more that would cause the direct and contingent
liabilities of the Borrower and its Subsidiaries, on a Consolidated basis, in
respect of all such obligations to exceed $35 million payable in any period of
12 consecutive months.
(j) Amendments of Constitutive Documents. Amend, or permit any
of its Subsidiaries to amend, its certificate of incorporation or bylaws or
other constitutive documents.
(k) Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (i) accounting policies or
reporting practices, except as required by generally accepted accounting
principles, or (ii) its Fiscal Year.
(l) Prepayments, Etc., of Debt. Except as otherwise allowed
pursuant to the Interim Order or the Final Order and in conformity with the
Final Budget and the Financial Forecasts Report, (i) prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in any
manner, or make any payment in violation of any subordination terms of, any
Existing Debt or other pre-Petition Date obligations of any Borrower or
Subsidiary Guarantor, or (ii) make any payment or create or permit any Lien
pursuant to section 361 of the Bankruptcy Code (or pursuant to any other
provision of the Bankruptcy Code authorizing adequate protection), or apply to
the Bankruptcy Court for the authority to do any of the foregoing; provided that
(a) the Borrower may make payments for administrative expenses that are allowed
and payable under sections 330 and 331 of the Bankruptcy Code, (b) the Borrower
may make payments permitted by the first day orders, and (c) the Borrower may
make payments to such other claimants and in such amounts as may be consented to
by the Agent and Required Lenders and approved by the Bankruptcy Court.
(m) Negative Pledge. Enter into or suffer to exist, or permit
any of its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon any of
its property or assets except (i) under the Orders and Loan Documents or (ii)
any agreement or instrument governing (A) any purchase money Debt permitted by
Section 5.02(c)(v) solely to the extent that the agreement or instrument
governing such Debt prohibits a Lien on the fixed or capital asset acquired with
the proceeds of such Debt or (B) any Capitalized Lease permitted by Section
5.02(c)(v) solely to the extent that such Capitalized Lease prohibits a Lien on
the property subject thereto.
(n) Partnerships, Etc. Become a general partner in any general
or limited partnership or joint venture, or permit any of its Subsidiaries to do
so, other than any Subsidiary the sole assets of which consist of its interest
in such partnership or joint venture.
(o) Speculative Transactions. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options or
futures contracts or any similar speculative transactions.
(p) [Intentionally Omitted]
(q) Formation of Subsidiaries. Organize or invest, or permit
any Subsidiary to organize or invest, in any new Subsidiary except as permitted
under Section 5.02(g).
70
(r) Payment Restrictions Affecting Subsidiaries. Directly or
indirectly, enter into or suffer to exist, or permit any of its Subsidiaries to
enter into or suffer to exist, any agreement or arrangement limiting the ability
of any of its Subsidiaries to declare or pay dividends or other distributions in
respect of its Equity Interests or repay or prepay any Debt owed to, make loans
or advances to, or otherwise transfer assets to or invest in, the Borrower or
any Subsidiary of the Borrower (whether through a covenant restricting
dividends, loans, asset transfers or investments, a financial covenant or
otherwise), except the Loan Documents and the Existing Agreement.
(s) Amendment, Etc., of Material Contracts. Cancel or
terminate any Material Contract or consent to or accept any cancellation or
termination thereof, amend or otherwise modify any Material Contract or give any
consent, waiver or approval thereunder, waive any default under or breach of any
Material Contract, agree in any manner to any other amendment, modification or
change of any term or condition of any Material Contract or take any other
action in connection with any Material Contract, in each case that would impair
in any material respect the value of the interest or rights of any Loan Party
thereunder or that would impair in any material respect the interest or rights
of any Agent or any Lender Party, or permit any of its Subsidiaries to do any of
the foregoing, provided that (x) the Borrower shall not be required to comply
with this paragraph (s) with respect to any such Material Contract rejected by
the Borrower by an order of the Bankruptcy Court and (y) the Borrower shall not
have breached this paragraph (s) with respect to any such Material Contract if
the Borrower is in default under any such Material Contract solely as a result
of a default thereunder of a kind specified in section 365(b)(2)(A), (B), (C) or
(D) of the Bankruptcy Code.
(t) Negative Covenant for certain Non-filing Subsidiaries.
None of the Non-filing Subsidiaries shall (i) engage in any business or activity
other than owning the membership interests in Virginia Independent Telephone
Alliance, L.C. ("VITAL") and/or partnership interests in Valley Network
Partnership ("ValleyNet") and activities incidental thereto, (ii) own or acquire
assets (except membership interests in VITAL and/or partnership interests in
ValleyNet and distributions received by it in respect of such membership or
partnership interests) or (iii) incur any Debt or liabilities (except its
guarantee of obligations under the Existing Credit Agreement, liabilities
imposed by law, including tax liabilities, and other liabilities incidental to
its existence and permitted business and activities).
SECTION 5.03 Reporting Requirements. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will furnish to the Agents and the Lender
Parties:
(a) Default Notice. As soon as possible and in any event
within two days after the occurrence of each Default continuing on the date of
such statement, a statement of the chief financial officer of the Borrower
setting forth details of such Default and the action that the Borrower has taken
and proposes to take with respect thereto.
(b) Annual Financials. (i) As soon as available and in any
event within 105 days after the end of each Fiscal Year (beginning with the
Fiscal Year ending December 31, 2002), a copy of the annual audit report for
such year for the Financial Covenants Parties, including therein Consolidated
and consolidating balance sheets of the Financial Covenants Parties as of the
71
end of such Fiscal Year and Consolidated and consolidating statements of income
and a Consolidated statement of cash flows of the Financial Covenants Parties
for such Fiscal Year, in each case accompanied by an opinion acceptable to the
Required Lenders of independent public accountants of recognized standing
acceptable to the Required Lenders in their reasonable judgment (provided that
consolidating financial statements shall not be audited), together with (i) a
certificate of such accounting firm to the Lender Parties stating that in the
course of the regular audit of the business of the Financial Covenants Parties,
which audit was conducted by such accounting firm in accordance with generally
accepted auditing standards, such accounting firm has obtained no knowledge that
a Default has occurred and is continuing, or if, in the opinion of such
accounting firm, a Default has occurred and is continuing, a statement as to the
nature thereof, (ii) a schedule in form satisfactory to the Administrative Agent
of the computations used by such accountants in determining, as of the end of
such Fiscal Year, compliance with the covenants contained in Section 5.04 (,
provided that, in the event of any change in GAAP used in the preparation of
such financial statements, the applicable Financial Covenants Party shall also
provide, if necessary for the determination of compliance with Section 5.04, a
statement of reconciliation conforming such financial statements to GAAP and
(iii) a certificate of the Chief Financial Officer of the applicable Financial
Covenants Party stating that no Default has occurred and is continuing or, if a
Default has occurred and is continuing, a statement as to the nature thereof and
the action that the applicable Financial Covenants Party has taken and proposes
to take with respect thereto.
(c) Quarterly Financials. (i) As soon as available and in any
event within 45 days after the end of each of the first three quarters of each
Fiscal Year, Consolidated and consolidating balance sheets of the Financial
Covenants Parties as of the end of such quarter and Consolidated and
consolidating statements of income and a Consolidated statement of cash flows of
the Financial Covenants Parties for the period commencing at the end of the
previous fiscal quarter and ending with the end of such fiscal quarter and
Consolidated and consolidating statements of income and a Consolidated statement
of cash flows of the Financial Covenants Parties for the period commencing at
the end of the previous Fiscal Year and ending with the end of such quarter,
setting forth in each case in comparative form the corresponding figures for the
corresponding date or period of the preceding Fiscal Year, all in reasonable
detail and duly certified (subject to normal year-end audit adjustments) by the
Chief Financial Officer of the applicable Financial Covenants Party as having
been prepared in accordance with GAAP, together with (i) a certificate of said
officer stating that no Default has occurred and is continuing or, if a Default
has occurred and is continuing, a statement as to the nature thereof and the
action that the Borrower has taken and proposes to take with respect thereto and
(ii) a schedule in form satisfactory to the Administrative Agent of the
computations used by the Financial Covenants Parties in determining compliance
with the covenants contained in Section 5.04, provided that, in the event of any
change in GAAP used in the preparation of such financial statements, the
Financial Covenants Parties shall also provide, if necessary for the
determination of compliance with Section 5.04, a statement of reconciliation
conforming such financial statements to GAAP.
(d) Litigation. Promptly after the commencement thereof,
notice of all actions, suits, investigations, litigation and proceedings before
any court or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, affecting any Loan Party or any of its
Subsidiaries of the type described in Section 4.01(f).
72
(e) Securities Reports. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and reports that
any Loan Party or any of its Subsidiaries sends to its stockholders, and copies
of all regular, periodic and special reports, and all registration statements,
that any Loan Party or any of its Subsidiaries files with the Securities and
Exchange Commission or any governmental authority that may be substituted
therefor, or with any national securities exchange.
(f) Creditor Reports. Promptly after the furnishing thereof,
copies of any statement or report furnished to any holder of Debt securities of
any Loan Party or of any of its Subsidiaries pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required to be
furnished to the Lender Parties pursuant to any other clause of this Section
5.03.
(g) Agreement Notices. (x) No later than 20 Business Days
prior to the effectiveness of any proposed material change to any Material
Contract (including, without limitation, any contracts between any Loan Party
and Horizon PCS, Inc.), notice and a detailed explanation thereof, and (y)
promptly upon receipt thereof, copies of all notices, requests and other
documents received by any Loan Party or any of its Subsidiaries under or
pursuant to any Related Document or Material Contract or instrument, indenture,
loan or credit or similar agreement regarding or related to any breach or
default by any party thereto or any other event that could materially impair the
value of the interests or the rights of any Loan Party or otherwise have a
Material Adverse Effect and copies of any amendment, modification or waiver of
any provision of any Related Document or Material Contract or instrument,
indenture, loan or credit or similar agreement and, from time to time upon
request by the Administrative Agent, such information and reports regarding the
Related Documents, the Material Contracts and such instruments, indentures and
loan and credit and similar agreements as the Administrative Agent may
reasonably request.
(h) Revenue Agent Reports. Within 10 Business Days after
receipt, copies of all Revenue Agent Reports (including Internal Revenue Service
Forms 4549 and 886A, if received), or other written proposals of the Internal
Revenue Service, that propose, determine or otherwise set forth positive
adjustments to the Federal income tax liability of the affiliated group (within
the meaning of Section 1504(a)(1) of the Internal Revenue Code) of which the
Borrower is a member aggregating $1,000,000 or more, provided that the Borrower
shall not be obligated to disclose any information that the Borrower reasonably
deems confidential.
(i) Tax Certificates. Promptly, and in any event within ten
Business Days after the due date (with extensions) for filing the final Federal
income tax return in respect of each taxable year, a certificate (a "Tax
Certificate"), signed by the President or the Chief Financial Officer of the
Borrower, stating that the Borrower and its Subsidiaries have paid to the
Internal Revenue Service or other taxing authority, the full amount that is
shown on such return as being required to be paid in respect of Federal income
tax for such year.
(j) ERISA. (i) ERISA Events and ERISA Reports. (A) Promptly
and in any event within 10 days after any Loan Party or any ERISA Affiliate
knows or has reason to know that any ERISA Event has occurred, a statement of
the Chief Financial Officer of the Borrower describing such ERISA Event and the
73
action, if any, that such Loan Party or such ERISA Affiliate has taken and
proposes to take with respect thereto and (B) on the date any records, documents
or other information must be furnished to the PBGC with respect to any Plan
pursuant to Section 4010 of ERISA, a copy of such records, documents and
information.
(ii) Plan Terminations. Promptly and in any event
within two Business Days after receipt thereof by any Loan
Party or any ERISA Affiliate, copies of each notice from the
PBGC stating its intention involuntarily to terminate any Plan
or to have a trustee appointed to administer any Plan.
(iii) Plan Annual Reports. Promptly and in any event
within 30 days after the filing thereof with the Internal
Revenue Service, copies of each Schedule B (Actuarial
Information), if any, required to be attached to the annual
report (Form 5500 Series) with respect to each Plan.
(iv) Multiemployer Plan Notices. Promptly and in any
event within five Business Days after receipt thereof by any
Loan Party or any ERISA Affiliate from the sponsor of a
Multiemployer Plan, copies of each notice concerning (A) the
imposition of Withdrawal Liability by any such Multiemployer
Plan, (B) the reorganization or termination, within the
meaning of Title IV of ERISA, of any such Multiemployer Plan
or (C) the amount of liability incurred, or that may be
incurred, by such Loan Party or any ERISA Affiliate in
connection with any event described in clause (A) or (B).
(k) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of any
noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit that could (i) reasonably be expected
to have a Material Adverse Effect or (ii) cause any property described in the
Mortgages to be subject to any restrictions on ownership, occupancy, use or
transferability under any Environmental Law that would interfere in the use of
such property for its current purposes.
(l) Real Property. As soon as available and in any event
within 30 days after the end of each Fiscal Year, a report supplementing
Schedules 4.01(x) and 4.01(y) hereto, including an identification of all owned
and leased real property disposed of by the Borrower or any of its Subsidiaries
during such Fiscal Year, a list and description (including the street address,
county or other relevant jurisdiction, state, record owner, book value thereof
and, in the case of leases of property, lessor, lessee, expiration date and
annual rental cost thereof) of all real property acquired or leased during such
Fiscal Year and a description of such other changes in the information included
in such Schedules as may be necessary for such Schedules to be accurate and
complete.
(m) Insurance. As soon as available and in any event within 30
days after the end of each Fiscal Year, a report summarizing the insurance
coverage (specifying type, amount and carrier) in effect for each Loan Party and
its Subsidiaries and containing such additional information as any Agent, or any
Lender Party through the Administrative Agent, may reasonably specify.
74
(n) Other Information. Such other information respecting the
business, condition (financial or otherwise), operations, performance or
properties of any Loan Party or any of its Subsidiaries as any Agent, or any
Lender Party through the Administrative Agent, may from time to time reasonably
request.
(o) Monthly Financials. (i) As soon as available and in no
event later than 30 days after the end of each calendar month, a Consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such month
and a Consolidated statement of cash flows, Consolidated and consolidating
statements of income and a Consolidated Capital Expenditures Report of the
Borrower and its Subsidiaries for such month and a Consolidated statement of
cash flows, Consolidated and consolidating statements of income and a
Consolidated Capital Expenditures Report of the Borrower and its Subsidiaries
for the period commencing at the end of the previous Fiscal Year and ending with
the end of such month, setting forth (A) in each case in comparative form the
corresponding figures for such month from the forecast most recently delivered;
(B) EBITDA for such month and the calculations used to arrive at such EBITDA
figure; and (C) the aggregate outstanding COD Payments as of the end of such
month.
(ii) as soon as available but in no event later than
ten Business Days after the end of each month, a report in the form of
Exhibit K hereto (a "Cash Reconciliation Report") demonstrating that
within five Business Days after the end of such month, the total amount
of cash on hand of the Borrower and its Subsidiaries was not more than
the amount permitted by Section 5.04(b), all in reasonable detail and
duly certified by the Chief Financial Officer of the Borrower.
(p) Weekly Forecasts. No later than 12:00 PM (Charlotte, North
Carolina time) on Thursday of each week (or if such day is not a Business Day,
the immediately succeeding Business Day), (i) the budget of the Borrower and its
Subsidiaries for the 13 weeks beginning the next succeeding Monday (each, a
"13-Week Forecast"), which shall set forth the Borrower's anticipated uses and
sources of funds for such weeks and shall be satisfactory in form and substance
to the Administrative Agent in the Administrative Agent's sole discretion, and
(ii) a variance report for the preceding week (each, a "Variance Report"), which
shall set forth the variance between anticipated uses and sources of funds of
the Borrower and its Subsidiaries for such week as set forth in the 13-Week
Forecast last delivered to the Administrative Agent prior to such week, and the
actual uses and sources of funds of the Borrower and its Subsidiaries for such
week, and shall be satisfactory in form and substance to the Administrative
Agent in the Administrative Agent's sole discretion. The Borrower shall use
commercially reasonable efforts to expend funds during each week in substantial
conformity with the categories and amounts of expenditures reflected in the
13-Week Forecast most recently delivered and which includes such week.
(q) Compliance Report. No later than 30 days after the end of
each calendar month a preliminary unaudited report of the Borrower demonstrating
the Borrower's compliance with each covenant of the Borrower contained in
Section 5.04, setting forth in reasonable detail the calculations thereof,
together with a certificate of the Chief Financial Officer of the applicable
Financial Covenants Parties stating that no Default or Event of Default has
occurred and is continuing.
75
SECTION 5.04 Financial Covenants. So long as any Advance or any other
Obligation of any Loan Party under any Loan Document shall remain unpaid, any
Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder:
(a) Minimum EBITDA. The Borrower will not permit EBITDA for
each period listed below to be less than the EBITDA amount set forth opposite
such period:
Period Starting Period Ending Minimum
EBITDA
4/1/02 3/31/03 $74.3 million
5/1/02 4/30/03 $75.4 million
6/1/02 5/31/03 $74.7 million
7/1/02 6/30/03 $74.7 million
8/1/02 7/31/03 $75.3 million
9/1/02 8/31/03 $75.3 million
(b) Minimum Operative Cash Flow. The Borrower will not permit
Operative Cash Flows for each period set forth below to be less than the amount
set forth opposite such period:
Minimum
Period Starting Period Ending Operative Cash Flow Before
COD Payments
3/1/03 3/31/03 $(3.4) million
3/1/03 4/30/03 $(1.7) million
3/1/03 5/31/03 $(1.1) million
3/1/03 6/30/03 $(3.8) million
3/1/03 7/31/03 $(2.6) million
3/1/03 8/31/03 $(3.6) million
(c) Limitation on Outstanding COD Payments. Aggregate
outstanding and unapplied or offset COD Payments shall not exceed the amount set
forth on Schedule 5.04(c) hereto on any date.
(d) Capital Expenditures. Make, or permit any of its
Subsidiaries to make, Capital Expenditures that would cause the aggregate of all
such Capital Expenditures made by the Borrower and its Subsidiaries (on a
Consolidated basis) during the periods listed below to exceed the amounts
opposite each period:
76
Period Starting Period Ending Amount
1/1/03 3/31/03 $15.0 million
1/1/03 4/30/03 $23.0 million
1/1/03 5/31/03 $28.6 million
1/1/03 6/30/03 $34.3 million
1/1/03 7/31/03 $41.2 million
1/1/03 8/31/03 $45.0 million
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01 Events of Default. If any of the following events ("Events
of Default") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any
Advance when the same shall become due and payable or (ii) the Borrower shall
fail to pay any interest on any Advance, or any Loan Party shall fail to make
any other payment under any Loan Document, in each case under this clause (ii)
within three Business Days after the same becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or
any of its officers) under or in connection with any Loan Document shall prove
to have been incorrect in any material respect when made; or
(c) the Borrower shall fail to perform or observe any term,
covenant or agreement contained in ▇▇▇▇▇▇▇ ▇.▇▇, ▇.▇▇, ▇.▇▇(▇), (▇), (▇), (▇),
(▇), (▇), (▇), (q) or (r), 5.02, 5.03 (other than 5.03(p) and 5.03(q)) or 5.04;
or
(d) the Borrower shall fail to observe or perform the covenant
contained in Section 5.03(p) or (q) hereof and such default shall continue
unremedied for more than one (1) Business Day; or
(e) any of the Cases shall be dismissed or converted to a case
under chapter 7 of the Bankruptcy Code or the Debtor or any Committee shall file
a motion or other pleading seeking the dismissal of any of the Cases under
section 1112 of the Bankruptcy Code or otherwise; a trustee under chapter 7 or
chapter 11 of the Bankruptcy Code, a responsible officer or an examiner with
enlarged powers relating to the operation of the business (powers beyond those
set forth in Section 1106(a)(3) and (4) of the Bankruptcy Code) under section
1106(b) of the Bankruptcy Code shall be appointed in any of the Cases and the
order appointing such trustee, responsible officer or examiner shall not be
77
reversed or vacated within 30 days after the entry thereof; or an application
shall be filed by any Borrower or any Guarantor for the approval of any other
Superpriority Claim (other than the Carve Out) in any of the Cases which is pari
passu with or senior to the claims of the Agents and the Lenders against any
Borrower or any Guarantor hereunder, or there shall arise or be granted any such
pari passu or senior Superpriority Claim; or
(f) the Bankruptcy Court shall enter an order or orders
granting relief from the automatic stay applicable under section 362 of the
Bankruptcy Code to the holder or holders of any security interest to permit
foreclosure (or the granting of a deed in lieu of foreclosure or the like) on
any assets of any of the Borrower or the Subsidiary Guarantors that have a value
in excess of $1,000,000 in the aggregate; or
(g) (i) any provision of any Loan Document shall, for any
reason, cease to be valid and binding or any of the Borrower or the Subsidiary
Guarantors shall so assert in any pleading filed in any court or (ii) there
shall exist on the Collateral any Liens (other than Liens permitted by Section
5.02(a) (other than Section 5.02(a)(iii)), (x) securing obligations in an amount
in excess of $5,000,000 in the aggregate and (y) that rank pari passu with or
senior to the Liens securing the Obligations (other than Liens permitted by
Section 5.02(a)(v)); or
(h) an order of the Bankruptcy Court shall be entered
reversing, amending, supplementing, staying for a period in excess of 10 days,
vacating or otherwise modifying either of the Orders or terminating the use of
cash collateral by the Borrower or the Subsidiary Guarantors pursuant to the
Orders; or
(i) any judgment or order as to a post-petition liability or
Debt for the payment of money in excess of $1,000,000 shall be rendered against
any of the Borrower or the Subsidiary Guarantors and the enforcement thereof
shall not have been stayed; or
(j) any non-monetary judgment or order with respect to a
post-petition event shall be rendered against any of the Borrower or the
Guarantors which does or would reasonably be expected to (i) cause a Material
Adverse Effect, (ii) have a Material Adverse Effect on the ability of any of the
Borrower or the Guarantors to perform their respective obligations under any
Loan Document, or (iii) have a Material Adverse Effect on the rights and
remedies of any Agent or any Lender under any Loan Document, and there shall be
any period of 10 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(k) except as permitted by the Orders, the Borrower or the
Guarantors (including all present and future debtors) shall make any
pre-petition payment other than pre-petition payments authorized by the
Bankruptcy Court in respect of: (i) certain critical vendors (including, without
limitation, valid mechanics' liens) in a total amount not in excess of
$2,000,000, (ii) accrued payroll and related expenses and employee benefits as
of the Petition Date, (iii) valid reclamation claims in a total amount not in
excess of $1,000,000, (iv) the claims of common carriers and warehousemen in a
total amount not in excess of $500,000, (v) sales and use taxes in a total
amount not in excess of $500,000; or
78
(l) any Loan Party shall fail to perform or observe any other
term, covenant or agreement contained in any Loan Document on its part to be
performed or observed if such failure shall remain unremedied for 20 days after
the earlier of the date on which (i) a Responsible Officer becomes aware of such
failure or (ii) written notice thereof shall have been given to the Borrower by
any Agent or any Lender Party; or
(m) any material provision of any Loan Document after delivery
thereof pursuant to Section 3.01 or 5.01(j) shall for any reason cease to be
valid and binding on or enforceable against any Loan Party party to it, or any
such Loan Party shall so state in writing; or
(n) any Collateral Document after delivery thereof pursuant to Section 3.01 or
5.01(j) shall for any reason (other than pursuant to the terms thereof) cease to
create a valid and perfected lien with the requisite priority as specified in
the Orders (except as permitted by the Loan Documents) on and security interest
in the Collateral purported to be covered thereby; or
(o) a Change of Control shall occur; or
(p) any ERISA Event shall have occurred with respect to a Plan
and the sum (determined as of the date of occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other Plans with
respect to which an ERISA Event shall have occurred and then exist (or the
liability of the Loan Parties and the ERISA Affiliates related to such ERISA
Event) would have a Material Adverse Effect; or
(q) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan in an amount that, when aggregated with all
other amounts required to be paid to Multiemployer Plans by the Loan Parties and
the ERISA Affiliates as Withdrawal Liability (determined as of the date of such
notification), exceeds $5 million or requires payments exceeding $1.25 million
per annum; or
(r) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, and as a result of such reorganization or termination the aggregate
annual contributions of the Loan Parties and the ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or being terminated have
been or will be increased over the amounts contributed to such Multiemployer
Plans for the plan years of such Multiemployer Plans immediately preceding the
plan year in which such reorganization or termination occurs by an amount
exceeding $1.25 million; or
(s) the Final Budget Date and the Financial Forecasts Report
Date shall not have occurred prior to the date of entry of the Interim Order;
then, and in any such event, and without further order of or
application to the Bankruptcy Court, the Administrative Agent (i) shall at the
request, or may with the consent, of the Required Lenders, by notice to the
Borrower, declare the Commitments of each Lender Party and the obligation of
each Lender Party to make Advances (other than Letter of Credit Advances by the
Issuing Bank or a Working Capital Lender pursuant to Section 2.03(c)) and of the
Issuing Bank to issue Letters of Credit to be terminated, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
79
consent, of the Required Lenders, by notice to the Borrower, declare the
Advances, all interest thereon and all other amounts payable under this
Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Advances, all such interest and all such amounts shall become and
be forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower.
SECTION 6.02 Actions in Respect of the Letters of Credit upon Default.
If any Event of Default shall have occurred and be continuing, the
Administrative Agent may, or shall at the request of the Required Lenders,
irrespective of whether it is taking any of the actions described in Section
6.01 or otherwise, make demand upon the Borrower to, and forthwith upon such
demand the Borrower will, pay to the Collateral Agent on behalf of the Lender
Parties in same day funds at the Collateral Agent's office designated in such
demand, for deposit in the L/C Cash Collateral Account, an amount equal to the
aggregate Available Amount of all Letters of Credit then outstanding. If at any
time the Administrative Agent or the Collateral Agent determines that any funds
held in the L/C Cash Collateral Account are subject to any right or claim of any
Person other than the Agents and the Lender Parties or that the total amount of
such funds is less than the aggregate Available Amount of all Letters of Credit,
the Borrower will, forthwith upon demand by the Administrative Agent or the
Collateral Agent, pay to the Collateral Agent, as additional funds to be
deposited and held in the L/C Cash Collateral Account, an amount equal to the
excess of (a) such aggregate Available Amount over (b) the total amount of
funds, if any, then held in the L/C Cash Collateral Account that the
Administrative Agent or the Collateral Agent, as the case may be, determines to
be free and clear of any such right and claim. Upon the drawing of any Letter of
Credit for which funds are on deposit in the L/C Cash Collateral Account, such
funds shall be applied to reimburse the Issuing Bank or Working Capital Lenders,
as applicable, to the extent permitted by applicable law.
ARTICLE VII
THE AGENTS
SECTION 7.01 Authorization and Action. Each Lender Party (in its
capacity as a Lender, or as the Issuing Bank (if applicable)) hereby appoints
and authorizes each Agent to take such action as agent on its behalf and to
exercise such powers and discretion under this Agreement and the other Loan
Documents as are delegated to such Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably incidental thereto.
As to any matters not expressly provided for by the Loan Documents (including,
without limitation, enforcement or collection of the Notes), no Agent shall be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required Lenders, and such
instructions shall be binding upon all Lender Parties and all holders of Notes;
provided, however, that no Agent shall be required to take any action that
exposes such Agent to personal liability or that is contrary to this Agreement
or applicable law. Each Agent agrees to give to each Lender Party prompt notice
of each notice given to it by the Borrower pursuant to the terms of this
Agreement.
80
SECTION 7.02 Agents' Reliance, Etc. Neither any Agent nor any of their
respective directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them under or in connection with
the Loan Documents, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, each Agent:
(a) may treat the payee of any Note as the holder thereof until, in the case of
the Administrative Agent, the Administrative Agent receives and accepts an
Assignment and Acceptance entered into by the Lender that is the payee of such
Note, as assignor, and an Eligible Assignee, as assignee, or, in the case of any
other Agent, such Agent has received notice from the Administrative Agent that
it has received and accepted such Assignment and Acceptance, in each case as
provided in Section 9.06; (b) may consult with legal counsel (including counsel
for any Loan Party), independent public accountants and other experts selected
by it with reasonable care and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (c) makes no warranty or representation to any
Lender Party and shall not be responsible to any Lender Party for any
statements, warranties or representations (whether written or oral) made in or
in connection with the Loan Documents; (d) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms, covenants
or conditions of any Loan Document on the part of any Loan Party or to inspect
the property (including the books and records) of any Loan Party; (e) shall not
be responsible to any Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, any Loan Document or any other instrument or
document furnished pursuant thereto; and (f) shall incur no liability under or
in respect of any Loan Document by acting upon any notice, consent, certificate
or other instrument or writing (which may be by telegram, telecopy or telex)
believed by it to be genuine and signed or sent by the proper party or parties.
SECTION 7.03 Agents and Affiliates. With respect to its Commitments,
the Advances made by it and the Notes issued to it, each Agent (whether current
or former) shall have the same rights and powers under the Loan Documents as any
other Lender Party and may exercise the same as though it were not an Agent; and
the term "Lender Party" or "Lender Parties" shall, unless otherwise expressly
indicated, include such Agent in its individual capacities. Each Agent (whether
current or former) and its respective affiliates may accept deposits from, lend
money to, act as trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business with, any Loan
Party, any of its Subsidiaries and any Person that may do business with or own
securities of any Loan Party or any such Subsidiary, all as if such Agent was
not an Agent and without any duty to account therefor to the Lender Parties."
SECTION 7.04 Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon any Agent or
any other Lender Party and based on the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon any Agent or any other Lender Party and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement.
81
SECTION 7.05 Indemnification. (a) Each Lender Party severally agrees to
indemnify each Agent (to the extent not promptly reimbursed by the Borrower)
from and against such Lender Party's ratable share (determined as provided
below) of any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against such
Agent in any way relating to or arising out of the Loan Documents or any action
taken or omitted by such Agent under the Loan Documents; provided, however, that
no Lender Party shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct as found in a final, non-appealable judgment by a court of
competent jurisdiction. Without limitation of the foregoing, each Lender Party
agrees to reimburse each Agent promptly upon demand for its ratable share of any
costs and expenses (including, without limitation, reasonable fees and expenses
of counsel) payable by the Borrower under Section 9.04, to the extent that such
Agent is not promptly reimbursed for such costs and expenses by the Borrower.
(b) Each Lender Party severally agrees to indemnify the
Issuing Bank (to the extent not promptly reimbursed by the Borrower) from and
against such Lender Party's ratable share (determined as provided below) of any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted against the Issuing
Bank in any way relating to or arising out of the Loan Documents or any action
taken or omitted by the Issuing Bank under the Loan Documents; provided,
however, that no Lender Party shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Issuing Bank's gross
negligence or willful misconduct as found in a final, non-appealable judgment by
a court of competent jurisdiction. Without limitation of the foregoing, each
Lender Party agrees to reimburse the Issuing Bank promptly upon demand for its
ratable share of any costs and expenses (including, without limitation,
reasonable fees and expenses of counsel) payable by the Borrower under Section
9.04, to the extent that the Issuing Bank is not promptly reimbursed for such
costs and expenses by the Borrower.
(c) For purposes of this Section 7.05, the Lender Parties'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (i) the aggregate principal amount of the Advances
outstanding at such time and owing to the respective Lender Parties, (ii) their
respective Pro Rata Shares of the aggregate Available Amount of all Letters of
Credit outstanding at such time and (iii) their respective Unused Working
Capital Commitments at such time; provided that the aggregate principal amount
of Letter of Credit Advances owing to the Issuing Bank shall be considered to be
owed to the Working Capital Lenders ratably in accordance with their respective
Working Capital Commitments. The failure of any Lender Party to reimburse any
Agent or the Issuing Bank, as the case may be, promptly upon demand for its
ratable share of any amount required to be paid by the Lender Parties to such
Agent or the Issuing Bank, as the case may be, as provided herein shall not
relieve any other Lender Party of its obligation hereunder to reimburse such
Agent or the Issuing Bank, as the case may be, for its ratable share of such
amount, but no Lender Party shall be responsible for the failure of any other
Lender Party to reimburse such Agent or the Issuing Bank, as the case may be,
82
for such other Lender Party's ratable share of such amount. Without prejudice to
the survival of any other agreement of any Lender Party hereunder, the agreement
and obligations of each Lender Party contained in this Section 7.05 shall
survive the payment in full of principal, interest and all other amounts payable
hereunder and under the other Loan Documents.
SECTION 7.06 Successor Agents. Any Agent may resign as to all of the
Facilities at any time by giving written notice thereof to the Lender Parties
and the Borrower and may be removed as to all of the Facilities at any time with
or without cause by the Required Lenders. Upon any such resignation or removal,
the Required Lenders shall have the right to appoint a successor Agent (subject
to the Borrower's approval (at any time when no Event of Default has occurred
and is continuing), which shall not be unreasonably withheld or delayed). If no
successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the retiring Agent's giving
of notice of resignation or the Required Lenders' removal of the retiring Agent,
then the retiring Agent may, on behalf of the Lender Parties (subject to the
Borrower's approval (at any time when no Event of Default has occurred and is
continuing), which shall not be unreasonably withheld or delayed), appoint a
successor Agent, which shall be a commercial bank organized under the laws of
the United States or of any state thereof and having a combined capital and
surplus of at least $250,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent as to all of the Facilities and, in the
case of a successor Collateral Agent, upon the execution and filing or recording
of such financing statements, or amendments thereto, and such amendments or
supplements to the Mortgages, and such other instruments or notices, as may be
necessary or desirable, or as the Required Lenders may request, in order to
continue the perfection of the Liens granted or purported to be granted by the
Collateral Documents, such successor Agent shall succeed to and become vested
with all the rights, powers, discretion, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under the Loan Documents. If within 45 days after written notice is
given of the retiring Agent's resignation or removal under this Section 7.06 no
successor Agent shall have been appointed and shall have accepted such
appointment, then on such 45th day (i) the retiring Agent's resignation or
removal shall become effective, (ii) the retiring Agent shall thereupon be
discharged from its duties and obligations under the Loan Documents and (iii)
the Required Lenders shall thereafter perform all duties of the retiring Agent
under the Loan Documents until such time, if any, as the Required Lenders
appoint a successor Agent as provided above. After any retiring Agent's
resignation or removal hereunder as Agent as to any of the Facilities shall have
become effective, the provisions of this Article VII shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent as to
such Facilities under this Agreement.
ARTICLE VIII
GUARANTY
SECTION 8.01 Guaranty; Limitation of Liability.
(a) Each Guarantor, jointly and severally, hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due,
whether at scheduled maturity or on any date of a required prepayment or by
acceleration, demand or otherwise, of all Obligations of each other Loan Party
now or hereafter existing under or in respect of the Loan Documents (including,
without limitation, any extensions, modifications, substitutions, amendments or
renewals of any or all of the foregoing Obligations), whether direct or
83
indirect, absolute or contingent, and whether for principal, interest, premiums,
fees, indemnities, contract causes of action, costs, expenses or otherwise (such
Obligations being the "Guaranteed Obligations"), and agrees to pay any and all
expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by the Administrative Agent or any other Secured Party in
enforcing any rights under this Guaranty or any other Loan Document. Without
limiting the generality of the foregoing, each Guarantor's liability shall
extend to all amounts that constitute part of the Guaranteed Obligations and
would be owed by any other Loan Party to any Secured Party under or in respect
of the Loan Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such other Loan Party.
(b) Each Guarantor, and by its acceptance of this Guaranty,
the Administrative Agent and each other Secured Party, hereby confirms that it
is the intention of all such Persons that this Guaranty and the Obligations of
each Guarantor hereunder not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state law to the
extent applicable to this Guaranty and the Obligations of each Guarantor
hereunder. To effectuate the foregoing intention, the Administrative Agent, the
other Secured Parties and the Guarantors hereby irrevocably agree that the
Obligations of each Subsidiary Guarantor under this Guaranty at any time shall
be limited to the maximum amount as will result in the Obligations of such
Guarantor under this Guaranty not constituting a fraudulent transfer or
conveyance.
(c) Each Guarantor hereby unconditionally and irrevocably
agrees that in the event any payment shall be required to be made to any Secured
Party under this Guaranty or any other guaranty, such Guarantor will contribute,
to the maximum extent permitted by law and the foregoing subsection (b), such
amounts to each other Guarantor and each other guarantor of Obligations so as to
maximize the aggregate amount paid to the Secured Parties under or in respect of
the Loan Documents.
SECTION 8.02 Guaranty Absolute. Each Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms of the
Loan Documents, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of any
Secured Party with respect thereto. The Obligations of each Guarantor under or
in respect of this Guaranty are independent of the Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the Loan
Documents, and a separate action or actions may be brought and prosecuted
against each Guarantor to enforce this Guaranty, irrespective of whether any
action is brought against the Borrower or any other Loan Party or whether the
Borrower or any other Loan Party is joined in any such action or actions. The
liability of each Guarantor under this Guaranty shall be irrevocable, absolute
and unconditional irrespective of, and each Guarantor hereby irrevocably waives
any defenses it may now have or hereafter acquire in any way relating to, any or
all of the following:
84
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Guaranteed Obligations or any other
Obligations of any other Loan Party under or in respect of the Loan Documents,
or any other amendment or waiver of or any consent to departure from any Loan
Document, including, without limitation, any increase in the Guaranteed
Obligations resulting from the extension of additional credit to any Loan Party
or any of its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any
Collateral or any other collateral, or any taking, release or amendment or
waiver of, or consent to departure from, any other guaranty, for all or any of
the Guaranteed Obligations;
(d) any manner of application of Collateral or any other
collateral, or proceeds thereof, to all or any of the Guaranteed Obligations, or
any manner of sale or other disposition of any Collateral or any other
collateral for all or any of the Guaranteed Obligations or any other Obligations
of any Loan Party under the Loan Documents or any other assets of any Loan Party
or any of its Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan
Party any information relating to the business, condition (financial or
otherwise), operations, performance, properties or prospects of any other Loan
Party now or hereafter known to such Secured Party (each Guarantor waiving any
duty on the part of the Secured Parties to disclose such information);
(g) the failure of any other Person to execute or deliver this
Guaranty, any Guaranty Supplement or any other guaranty or agreement or the
release or reduction of liability of any Guarantor or other guarantor or surety
with respect to the Guaranteed Obligations; or
(h) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any representation by
any Secured Party that might otherwise constitute a defense available to, or a
discharge of, any Loan Party or any other guarantor or surety.
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by any Secured Party or any other Person upon the
insolvency, bankruptcy or reorganization of the Borrower or any other Loan Party
or otherwise, all as though such payment had not been made.
SECTION 8.03 Waivers and Acknowledgments.
(a) Each Guarantor hereby unconditionally and irrevocably
waives promptness, diligence, notice of acceptance, presentment, demand for
performance, notice of nonperformance, default, acceleration, protest or
dishonor and any other notice with respect to any of the Guaranteed Obligations
85
and this Guaranty and any requirement that any Secured Party protect, secure,
perfect or insure any Lien or any property subject thereto or exhaust any right
or take any action against any Loan Party or any other Person or any Collateral.
(b) Each Guarantor hereby unconditionally and irrevocably
waives any right to revoke this Guaranty and acknowledges that this Guaranty is
continuing in nature and applies to all Guaranteed Obligations, whether existing
now or in the future.
(c) Each Guarantor hereby unconditionally and irrevocably
waives (i) any defense arising by reason of any claim or defense based upon an
election of remedies by any Secured Party that in any manner impairs, reduces,
releases or otherwise adversely affects the subrogation, reimbursement,
exoneration, contribution or indemnification rights of such Guarantor or other
rights of such Guarantor to proceed against any of the other Loan Parties, any
other guarantor or any other Person or any Collateral and (ii) any defense based
on any right of set-off or counterclaim against or in respect of the Obligations
of such Guarantor hereunder.
(d) Each Guarantor acknowledges that the Collateral Agent may,
without notice to or demand upon such Guarantor and without affecting the
liability of such Guarantor under this Guaranty, foreclose under any mortgage by
nonjudicial sale, and each Guarantor hereby waives any defense to the recovery
by the Collateral Agent and the other Secured Parties against such Guarantor of
any deficiency after such nonjudicial sale and any defense or benefits that may
be afforded by applicable law.
(e) Each Guarantor hereby unconditionally and irrevocably
waives any duty on the part of any Secured Party to disclose to such Guarantor
any matter, fact or thing relating to the business, condition (financial or
otherwise), operations, performance, properties or prospects of any other Loan
Party or any of its Subsidiaries now or hereafter known by such Secured Party.
(f) Each Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing arrangements
contemplated by the Loan Documents and that the waivers set forth in Section
8.02 and this Section 8.03 are knowingly made in contemplation of such benefits.
SECTION 8.04 Subrogation. Each Guarantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or hereafter
acquire against the Borrower, any other Loan Party or any other insider
guarantor that arise from the existence, payment, performance or enforcement of
such Guarantor's Obligations under or in respect of this Guaranty or any other
Loan Document, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of any Secured Party against the Borrower,
any other Loan Party or any other insider guarantor or any Collateral, whether
or not such claim, remedy or right arises in equity or under contract, statute
or common law, including, without limitation, the right to take or receive from
the Borrower, any other Loan Party or any other insider guarantor, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security on account of such claim, remedy or right, unless and until
all of the Guaranteed Obligations and all other amounts payable under this
Guaranty shall have been paid in full in cash, all Letters of Credit shall have
expired or been terminated and the Commitments shall have expired or been
terminated. If any amount shall be paid to any Guarantor in violation of the
immediately preceding sentence at any time prior to the latest of (a) the
payment in full in cash of the Guaranteed Obligations and all other amounts
payable under this Guaranty, (b) the Termination Date and (c) the latest date of
expiration or termination of all Letters of Credit, such amount shall be
86
received and held in trust for the benefit of the Secured Parties, shall be
segregated from other property and funds of such Guarantor and shall forthwith
be paid or delivered to the Administrative Agent in the same form as so received
(with any necessary endorsement or assignment) to be credited and applied to the
Guaranteed Obligations and all other amounts payable under this Guaranty,
whether matured or unmatured, in accordance with the terms of the Loan
Documents, or to be held as Collateral for any Guaranteed Obligations or other
amounts payable under this Guaranty thereafter arising. If (i) any Guarantor
shall make payment to any Secured Party of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations and all other amounts
payable under this Guaranty shall have been paid in full in cash, (iii) the
Termination Date shall have occurred and (iv) all Letters of Credit shall have
expired or been terminated, the Secured Parties will, at such Guarantor's
request and expense, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Guaranteed Obligations and the Collateral resulting from such payment made by
such Guarantor pursuant to this Guaranty.
SECTION 8.05 Guaranty Supplements. Upon the execution and delivery by
any Person of a guaranty supplement in substantially the form of Exhibit I
hereto (each, a "Guaranty Supplement"), (a) such Person shall be referred to as
an "Additional Guarantor" and shall become and be a Guarantor hereunder, and
each reference in this Guaranty to a "Guarantor" shall also mean and be a
reference to such Additional Guarantor, and each reference in any other Loan
Document to a "Subsidiary Guarantor" shall also mean and be a reference to such
Additional Guarantor, and (b) each reference herein to "this Guaranty",
"hereunder", "hereof" or words of like import referring to this Guaranty, and
each reference in any other Loan Document to the "Guaranty", "thereunder",
"thereof" or words of like import referring to this Guaranty, shall mean and be
a reference to this Guaranty as supplemented by such Guaranty Supplement.
SECTION 8.06 Subordination. Each Guarantor hereby subordinates any and
all debts, liabilities and other Obligations owed to such Guarantor by each
other Loan Party (the "Subordinated Obligations") to the Guaranteed Obligations
to the extent and in the manner hereinafter set forth in this Section 8.06:
(a) Prohibited Payments, Etc. Except during the continuance of
a Default (including the commencement and continuation of any proceeding under
any Bankruptcy Law relating to any other Loan Party), each Guarantor may receive
regularly scheduled payments from any other Loan Party on account of the
Subordinated Obligations. After the occurrence and during the continuance of any
Default (including the commencement and continuation of any proceeding under any
Bankruptcy Law relating to any other Loan Party), however, unless the Required
Lenders otherwise agree, no Guarantor shall demand, accept or take any action to
collect any payment on account of the Subordinated Obligations.
87
(b) Prior Payment of Guaranteed Obligations. In any proceeding
under any Bankruptcy Law relating to any other Loan Party, each Guarantor agrees
that the Secured Parties shall be entitled to receive payment in full in cash of
all Guaranteed Obligations (including all interest and expenses accruing after
the commencement of a proceeding under any Bankruptcy Law, whether or not
constituting an allowed claim in such proceeding ("Post-Petition Interest"))
before such Guarantor receives payment of any Subordinated Obligations.
(c) Turn-Over. After the occurrence and during the continuance
of any Default (including the commencement and continuation of any proceeding
under any Bankruptcy Law relating to any other Loan Party), each Guarantor
shall, if the Administrative Agent so requests, collect, enforce and receive
payments on account of the Subordinated Obligations as trustee for the Secured
Parties and deliver such payments to the Administrative Agent for application to
the Guaranteed Obligations (including all Post-Petition Interest), together with
any necessary endorsements or other instruments of transfer, but without
reducing or affecting in any manner the liability of such Guarantor under the
other provisions of this Guaranty.
(d) Administrative Agent Authorization. After the occurrence
and during the continuance of any Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to any other
Loan Party), the Administrative Agent is authorized and empowered (but without
any obligation to so do), in its discretion, (i) in the name of each Guarantor,
to collect and enforce, and, if such Guarantor fails to do so, to submit claims
in respect of, Subordinated Obligations and to apply any amounts received
thereon to the Guaranteed Obligations (including any and all Post-Petition
Interest), and (ii) to require each Guarantor (A) to collect and enforce, and to
submit claims in respect of, Subordinated Obligations and (B) to pay any amounts
received on such obligations to the Administrative Agent for application to the
Guaranteed Obligations (including any and all Post Petition Interest).]
SECTION 8.07 Continuing Guaranty; Assignments. This Guaranty is a
continuing guaranty and shall (a) remain in full force and effect until the
latest of (i) the payment in full in cash of the Guaranteed Obligations and all
other amounts payable under this Guaranty, (ii) the Termination Date and (iii)
the latest date of expiration or termination of all Letters of Credit, (b) be
binding upon the Guarantor, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Secured Parties and their successors,
transferees and assigns. Without limiting the generality of clause (c) of the
immediately preceding sentence, any Secured Party may assign or otherwise
transfer all or any portion of its rights and obligations under this Agreement
(including, without limitation, all or any portion of its Commitments, the
Advances owing to it and the Note or Notes held by it) to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect
thereof granted to such Secured Party herein or otherwise, in each case as and
to the extent provided in Section 9.06. No Guarantor shall have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Secured Parties.
88
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Amendments, Etc. No amendment or waiver of any provision
of this Agreement or the Notes or any other Loan Document, nor consent to any
departure by any Loan Party therefrom, shall in any event be effective unless
the same shall be in writing and signed (or, in the case of the Collateral
Documents, consented to) by the Required Lenders and, in the case of an
amendment, by the Borrower, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, however, that (a) no amendment, waiver or consent shall, unless in
writing and signed by all of the Lenders (other than any Lender Party that is,
at such time, a Defaulting Lender), do any of the following at any time: (i)
waive any of the conditions specified in Section 3.01 or, in the case of the
Initial Extension of Credit, Section 3.02, (ii) change the number of Lenders or
the percentage of (x) the Commitments, (y) the aggregate unpaid principal amount
of the Advances or (z) the aggregate Available Amount of outstanding Letters of
Credit that, in each case, shall be required for the Lenders or any of them to
take any action hereunder, (iii) reduce or limit the obligations of any
Guarantor under Section 8.01 or release any Guarantor or otherwise limit any
Guarantor's liability with respect to the Obligations owing to the Agents and
the Lender Parties (other than, to the extent permitted under the Subsidiary
Guaranty), (iv) release all or substantially all of the Collateral in any
transaction or series of related transactions or permit the creation,
incurrence, assumption or existence of any Lien on all or substantially all of
the Collateral in any transaction or series of related transactions to secure
any Obligations other than Obligations owing to the Secured Parties under the
Loan Documents, or (v) amend this Section 9.01 and (b) no amendment, waiver or
consent shall, unless in writing and signed by the Required Lenders and each
Lender (other than any Lender that is, at such time, a Defaulting Lender) that
has a Commitment under the Working Capital Facility if such Lender is directly
affected by such amendment, waiver or consent, (i) increase the Commitments of
such Lender or subject such Lender to any additional obligations, (ii) reduce
the principal of, or interest on, the Notes held by such Lender or any fees or
other amounts payable hereunder to such Lender, (iii) postpone any date fixed
for any payment of principal of, or interest on, the Notes held by such Lender
or any fees or other amounts payable hereunder to such Lender or (iv) change the
order of application of any prepayment set forth in Section 2.06 in any manner
that materially affects such Lender; provided further that no amendment, waiver
or consent shall, unless in writing and signed by the Issuing Bank in addition
to the Lenders required above to take such action, affect the rights or
obligations of the Issuing Bank under this Agreement; and provided further that
no amendment, waiver or consent shall, unless in writing and signed by an Agent
in addition to the Lenders required above to take such action, affect the rights
or duties of such Agent under this Agreement or the other Loan Documents;
provided further that this Agreement may be amended and restated with the
consent of the Borrower and the Administrative Agent to include a $5 million
swing line facility on customary terms and conditions.
SECTION 9.02 Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telegraphic, telecopy or
telex communication) and mailed, telegraphed, telecopied, telexed or delivered,
if to the Borrower, at its address at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇; if to any Initial Lender or the Initial
Issuing Bank, at its Domestic Lending Office specified opposite its name on
Schedule I hereto; if to any other Lender Party, at its Domestic Lending Office
89
specified in the Assignment and Acceptance pursuant to which it became a Lender
Party; if to the Collateral Agent or Administrative Agent, at its address at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇
▇▇▇▇▇▇▇▇ as well as to counsel to the Administrative Agent, ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Esq.; or, as to any party, at such other address as shall be designated
by such party in a written notice to the other parties. All such notices and
communications shall, when mailed, telegraphed, telecopied or telexed, be
effective three Business Days after being deposited in the U.S. mails, when
delivered to the telegraph company, transmitted by telecopier or confirmed by
telex answerback, respectively, except that notices and communications to any
Agent pursuant to Article II, III or VII shall not be effective until received
by such Agent. Manual delivery by telecopier of an executed counterpart of any
amendment or waiver of any provision of this Agreement or the Notes or of any
Exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of an original executed counterpart thereof.
SECTION 9.03 No Waiver; Remedies. No failure on the part of any Lender
Party or any Agent to exercise, and no delay in exercising, any right hereunder
or under any Note shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 9.04 Costs and Expenses. (a) The Borrower agrees to pay on
demand (i) all costs and expenses of the Administrative Agent incurred in good
faith in connection with the preparation, execution, delivery, administration,
modification and amendment of the Loan Documents (including, without limitation,
(A) all due diligence, collateral review, syndication, transportation, computer,
duplication, appraisal, audit, insurance, consultant, search, filing and
recording fees and expenses and (B) the reasonable fees and expenses of counsel
and consultants for the Administrative Agent with respect thereto (including
fees and expenses of counsel and consultants to the Administrative Agent and
local counsel to the Administrative Agent billed on a monthly basis), including
but not limited to with respect to advising such Agent as to its rights and
responsibilities, or the perfection, protection or preservation of rights or
interests, under the Loan Documents, with respect to negotiations with any Loan
Party or with other creditors of any Loan Party or any of its Subsidiaries
arising out of any Default or any events or circumstances that may give rise to
a Default and with respect to presenting claims in or otherwise participating in
or monitoring any bankruptcy, insolvency or other similar proceeding involving
creditors' rights generally and any proceeding ancillary thereto of which any
Loan Party is the subject), (ii) reasonable review costs (including reasonable
fees and expenses of counsel) of the other Agents in connection with this
Agreement and each amendment, modification or waiver hereunder and (iii) all
costs and expenses of each Agent and each Lender Party in connection with the
enforcement of the Loan Documents, whether in any action, suit or litigation, or
any bankruptcy, insolvency or other similar proceeding affecting creditors'
rights generally (including, without limitation, the reasonable fees and
expenses of counsel for the Administrative Agent and each Lender Party with
respect thereto).
90
(b) The Borrower agrees to indemnify and hold harmless each
Agent, each Lender Party and each of their Affiliates and their respective
officers, directors, employees, agents and advisors (each, an "Indemnified
Party") from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by reason of
(including, without limitation, in connection with any investigation, litigation
or proceeding or preparation of a defense in connection therewith) (i) the
Facilities, the actual or proposed use of the proceeds of the Advances or the
Letters of Credit, the Loan Documents or any of the transactions contemplated
thereby, or (ii) the actual or alleged presence of Hazardous Materials on any
property of any Loan Party or any of its Subsidiaries or any Environmental
Action relating in any way to any Loan Party or any of its Subsidiaries, except
to the extent such claim, damage, loss, liability or expense is found in a
final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.
In the case of an investigation, litigation or other proceeding to which the
indemnity in this Section 9.04(b) applies, such indemnity shall be effective
whether or not such investigation, litigation or proceeding is brought by any
Loan Party, its directors, shareholders or creditors or an Indemnified Party or
any Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated by the Loan Documents are consummated. The Borrower
also agrees not to assert any claim against any Agent, any Lender Party or any
of their Affiliates, or any of their respective officers, directors, employees,
attorneys and agents, on any theory of liability, for special, indirect,
consequential or punitive damages arising out of or otherwise relating to the
Facilities, the actual or proposed use of the proceeds of the Advances or the
Letters of Credit, the Loan Documents or any of the transactions contemplated by
the Loan Documents.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender Party other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.06, 2.09(b)(i) or
2.10(d), acceleration of the maturity of the Notes pursuant to Section 6.01 or
for any other reason, or by an Eligible Assignee to a Lender Party other than on
the last day of the Interest Period for such Advance upon an assignment of
rights and obligations under this Agreement pursuant to Section 9.06 as a result
of a demand by the Borrower pursuant to Section 9.06(a), or if the Borrower
fails to make any payment or prepayment of an Advance for which a notice of
prepayment has been given or that is otherwise required to be made, whether
pursuant to Section 2.04, 2.06 or 6.01 or otherwise, the Borrower shall, upon
demand by such Lender Party (with a copy of such demand to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender Party any
amounts required to compensate such Lender Party for any additional losses,
costs or expenses that it may reasonably incur as a result of such payment or
Conversion or such failure to pay or prepay, as the case may be, including,
without limitation, any loss (including loss of anticipated profits), cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by any Lender Party to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities, such amount
91
may be paid on behalf of such Loan Party by the Administrative Agent or any
Lender Party, in its sole discretion.
(e) Without prejudice to the survival of any other agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.10 and 2.12 and this Section
9.04 shall survive the payment in full of principal, interest and all other
amounts payable hereunder and under any of the other Loan Documents.
SECTION 9.05 Binding Effect. This Agreement shall become effective when
it shall have been executed by the Borrower and each Agent and the
Administrative Agent shall have been notified by each Initial Lender and the
Initial Issuing Bank that such Initial Lender and the Initial Issuing Bank has
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, each Agent and each Lender Party and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the Lender
Parties.
SECTION 9.06 Assignments and Participations. (a) Each Lender may and,
so long as no Event of Default shall have occurred and be continuing, if
demanded by the Borrower (following a demand by such Lender pursuant to Section
2.10 or 2.12) upon at least five Business Days' notice to such Lender and the
Administrative Agent, will assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment or Commitments, the Advances
owing to it and the Note or Notes held by it); provided, however, that (i) each
such assignment shall be of a uniform, and not a varying, percentage of all
rights and obligations under and in respect of one or more of the Facilities,
(ii) except in the case of an assignment to a Person that, immediately prior to
such assignment, was a Lender, an Affiliate of any Lender or an Approved Fund of
any Lender or an assignment of all of a Lender's rights and obligations under
this Agreement, the aggregate amount of the Commitments being assigned to such
Eligible Assignee pursuant to such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall in no event be
less than $1 million, (iii) each such assignment shall be to an Eligible
Assignee, and (iv) the parties to each such assignment shall execute and deliver
to the Administrative Agent, for its acceptance and recording in the Register,
an Assignment and Acceptance, together with any Note or Notes subject to such
assignment.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Acceptance,
(i) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or
Issuing Bank, as the case may be, hereunder and (ii) the Lender or Issuing Bank
assignor thereunder shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights (other than its rights under Sections 2.10, 2.12 and 9.04 to the
extent any claim thereunder relates to an event arising prior to such
assignment) and be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all of the remaining portion
of an assigning Lender's or Issuing Bank's rights and obligations under this
Agreement, such Lender or Issuing Bank shall cease to be a party hereto).
92
(c) By executing and delivering an Assignment and Acceptance,
each Lender Party assignor thereunder and each assignee thereunder confirm to
and agree with each other and the other parties thereto and hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such assigning
Lender Party makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with any Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, any Loan Document or any other instrument or
document furnished pursuant thereto; (ii) such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any Loan Party or the performance or observance by any
Loan Party of any of its obligations under any Loan Document or any other
instrument or document furnished pursuant thereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in Section 4.01 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon any Agent, such assigning Lender Party
or any other Lender Party and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes each
Agent to take such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to such Agent by the terms
hereof and thereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations that by the terms of this
Agreement are required to be performed by it as a Lender or Issuing Bank, as the
case may be.
(d) The Administrative Agent, acting for this purpose (but
only for this purpose) as the agent of the Borrower, shall maintain at its
address referred to in Section 9.02 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lender Parties and the Commitment under each Facility of,
and principal amount of the Advances owing under each Facility to, each Lender
Party from time to time (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Agents and the Lender Parties shall treat each Person whose name
is recorded in the Register as a Lender Party hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or any
Agent or any Lender Party at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender Party and an assignee, together with any Note or Notes
subject to such assignment, the Administrative Agent shall, if such Assignment
and Acceptance has been completed and is in substantially the form of Exhibit E
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower and each other Agent. In the case of any assignment by a Lender, within
five Business Days after its receipt of such notice, the Borrower, at its own
expense, shall execute and deliver to the Administrative Agent in exchange for
the surrendered Note or Notes a new Note to such Eligible Assignee in an amount
equal to the Commitment assumed by it under each Facility pursuant to such
Assignment and Acceptance and, if any assigning Lender has retained a Commitment
93
hereunder under such Facility, a new Note to such assigning Lender in an amount
equal to the Commitment retained by it hereunder. Such new Note or Notes shall
be in an aggregate principal amount equal to the aggregate principal amount of
such surrendered Note or Notes, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be in substantially the form of
Exhibit A hereto, as the case may be.
(f) The Issuing Bank may assign to an Eligible Assignee all of
its rights and obligations under the undrawn portion of its Letter of Credit
Commitment at any time; provided, however, that (i) each such assignment shall
be to an Eligible Assignee and (ii) the parties to each such assignment shall
execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance.
(g) Each Lender Party may sell participations to one or more
Persons (other than any Loan Party or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments, the Advances owing to it and
the Note or Notes (if any) held by it); provided, however, that (i) such Lender
Party's obligations under this Agreement (including, without limitation, its
Commitments) shall remain unchanged, (ii) such Lender Party shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender Party shall remain the holder of any such Note for all
purposes of this Agreement, (iv) the Borrower, the Agents and the other Lender
Parties shall continue to deal solely and directly with such Lender Party in
connection with such Lender Party's rights and obligations under this Agreement
and (v) no participant under any such participation shall have any right to
approve any amendment or waiver of any provision of any Loan Document, or any
consent to any departure by any Loan Party therefrom, except to the extent that
such amendment, waiver or consent would reduce the principal of, or interest on,
the Notes or any fees or other amounts payable hereunder, in each case to the
extent subject to such participation, postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, in each case to the extent subject to such participation, or release
all or substantially all of the Collateral.
(h) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.06, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower; provided, however, that, prior to any
such disclosure, the assignee or participant or proposed assignee or participant
shall agree to preserve the confidentiality of any Confidential Information
received by it from such Lender Party.
(i) Notwithstanding any other provision set forth in this
Agreement, any Lender Party may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and the Note or Notes held by it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System.
SECTION 9.07 Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
94
Manual delivery of an executed counterpart of a signature page to this Agreement
by telecopier shall be effective as delivery of an original executed counterpart
of this Agreement.
SECTION 9.08 No Liability of the Issuing Bank. The Borrower assumes all
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any of its officers or directors shall be liable or responsible for:
(a) the use that may be made of any Letter of Credit or any acts or omissions of
any beneficiary or transferee in connection therewith; (b) the validity,
sufficiency or genuineness of documents, or of any endorsement thereon, even if
such documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by the Issuing Bank against presentation of
documents that do not comply with the terms of a Letter of Credit, including
failure of any documents to bear any reference or adequate reference to the
Letter of Credit; or (d) any other circumstances whatsoever in making or failing
to make payment under any Letter of Credit, except that the Borrower shall have
a claim against the Issuing Bank, and the Issuing Bank shall be liable to the
Borrower, to the extent of any direct, but not consequential, damages suffered
by the Borrower that the Borrower proves were caused by (i) the Issuing Bank's
willful misconduct or gross negligence as determined in a final, non-appealable
judgment by a court of competent jurisdiction in determining whether documents
presented under any Letter of Credit comply with the terms of the Letter of
Credit or (ii) the Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
SECTION 9.09 Confidentiality. Neither any Agent nor any Lender Party
shall disclose any Confidential Information to any Person without the consent of
the Borrower, other than (a) to such Agent's or such Lender Party's Affiliates
and their officers, directors, employees, agents and advisors, (b) to actual or
prospective Eligible Assignees and participants, and then only on a confidential
basis, (c) as required by any law, rule or regulation or judicial process, (d)
as requested or required by any state, Federal or foreign authority or examiner
regulating such Lender Party, (e) in connection with any action by the
Administrative Agent or any Lender to enforce any term of this Agreement and (f)
to any rating agency when required by it, provided that, prior to any such
disclosure, such rating agency shall undertake to preserve the confidentiality
of any Confidential Information relating to the Loan Parties received by it from
such Lender Party.
SECTION 9.10 Release of Collateral. Upon the sale, lease, transfer or
other disposition of any item of Collateral of any Loan Party (including,
without limitation, as a result of the sale, in accordance with the terms of the
Loan Documents, of the Loan Party that owns such Collateral) in accordance with
the terms of the Loan Documents, the Collateral Agent will, at the Borrower's
expense, execute and deliver to such Loan Party such documents as such Loan
Party may reasonably request to evidence the release of such item of Collateral
from the assignment and security interest granted under the Collateral Documents
in accordance with the terms of the Loan Documents.
95
SECTION 9.11 Jurisdiction, Etc. (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of the United States Bankruptcy Court for the Eastern
District of Virginia, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or any of the other Loan
Documents to which it is a party, 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 courts. 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 shall affect any right that any party
may otherwise have to bring any action or proceeding relating to this Agreement
or any of the other Loan Documents in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that 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 of the
other Loan Documents to which it is a party in any New York State or Federal
court. 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.
SECTION 9.12 Governing Law. This Agreement and the Notes shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 9.13 Waiver of Jury Trial. Each of the Borrower, the Agents and
the Lender Parties irrevocably waives all right to trial by jury in any action,
proceeding or counterclaim (whether based on contract, tort or otherwise)
arising out of or relating to any of the Loan Documents, the Advances or the
actions of any Agent or any Lender Party in the negotiation, administration,
performance or enforcement thereof.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
96
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
NTELOS INC., as Borrower
By:
---------------------------------------------------
Name:
Title:
NTELOS CABLE INC.
NTELOS CABLE OF VIRGINIA INC.
NTELOS COMMUNICATIONS SERVICES INC.
NTELOS CORNERSTONE INC.
NTELOS LICENSES INC.
NTELOS NETWORK INC.
NTELOS PCS INC.
NTELOS WIRELESS INC.
NTELOS OF MARYLAND INC.
NTELOS OF KENTUCKY INC.
NTELOS NETACCESS INC.
NTELOS NET LLC
NTELOS PCS NORTH INC.
NTELOS TELEPHONE LLC
NA COMMUNICATIONS, INC.
RICHMOND 20 MHZ, LLC
R&B COMMUNICATIONS, INC.
ROANOKE & BOTETOURT NETWORK LLC
BOTETOURT LEASING, INC.
R&B CABLE, INC.
R&B NETWORK, INC.
R&B TELEPHONE LLC
THE BEEPER COMPANY
VIRGINIA PCS ALLIANCE, L.C.
VIRGINIA TELECOMMUNICATIONS PARTNERSHIP
WEST VIRGINIA PCS ALLIANCE, L.C.
as Subsidiary Guarantors
By:
---------------------------------------------------
Name:
Title:
VIRGINIA RSA 6 CELLULAR LIMITED PARTNERSHIP, as
Subsidiary Guarantor
By:
---------------------------------------------------
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent, Collateral Agent and
Lender
By:
---------------------------------------------------
Title:
Initial Issuing Bank
WACHOVIA BANK, NATIONAL ASSOCIATION
By:
---------------------------------------------------
Title:
