Exhibit 10.1
[EXECUTION COPY]
THIRD AMENDMENT TO CREDIT AGREEMENT
This THIRD AMENDMENT TO CREDIT AGREEMENT, dated as of November 1,
2001 (this "Amendment"), to the Existing Credit Agreement (as defined below)
is made by CTC COMMUNICATIONS CORP., a Massachusetts corporation (the
"Borrower"), CTC COMMUNICATIONS GROUP, INC., a Delaware corporation (the
"Parent"), and certain of the Lenders (such capitalized term and other
capitalized terms used in this preamble and the recitals below to have the
meanings set forth in, or are defined by reference in, Article I below).
W I T N E S S E T H:
WHEREAS, the Borrower, the Parent, the Lenders, Toronto Dominion (Texas),
Inc., as the Administrative Agent, ▇▇▇▇▇▇ Brothers, as the Syndication
Agent, Credit Suisse First Boston, as the Documentation Agent, and TD
Securities (USA) Inc., as the Arranger, are all parties to the Amended and
Restated Credit Agreement, dated as of August 15, 2000, as amended by the
First Amendment to Credit Agreement, dated as of September 30, 2000, and the
Second Amendment to Credit Agreement, dated as of November 14, 2000 (the
"Existing Credit Agreement", and as amended by this Amendment and as the
same may be further amended, supplemented, amended and restated or otherwise
modified from time to time, the "Credit Agreement");
WHEREAS, the Borrower desires to modify certain provisions of the Existing
Credit Agreement and the Lenders are willing to so modify the Existing
Credit Agreement on the terms and subject to the conditions set forth
herein;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained herein, the parties hereto hereby covenant and agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Definitions. The following terms when used in this
Amendment shall have the following meanings (such meanings to be equally
applicable to the singular and plural forms thereof):
"Amendment" is defined in the preamble.
"Borrower" is defined in the preamble.
"Credit Agreement" is defined in the first recital.
"Existing Credit Agreement" is defined in the first recital.
"Parent" is defined in the preamble.
"Third Amendment Effective Date" is defined in Article III.
SECTION 1.2. Other Definitions. Terms for which meanings are provided in the
Credit Agreement are, unless otherwise defined herein or the context
otherwise requires, used in this Amendment with such meanings.
ARTICLE II
AMENDMENTS TO CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Third Amendment
Effective Date, the provisions of the Existing Credit Agreement referred to
below are hereby amended in accordance with this Article II. Except as
expressly so amended, the Existing Credit Agreement shall continue in full
force and effect in accordance with its terms.
SECTION 2.1. Modification of Article I. Article I of the Existing Credit
Agreement is hereby amended as follows:
SECTION 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by inserting the following definition in such Section in the
appropriate alphabetical sequence:
"Amendment No. 3" means the Third Amendment to Credit Agreement, dated as
of November 1, 2001, to this Agreement.
SECTION 2.2. Modification of Article VII. Article VII of the Existing Credit
Agreement is hereby amended as follows:
SECTION 2.2.1. Section 7.2.2 of the Existing Credit Agreement is hereby
amended by inserting a new clause (l) following clause (k) thereof as
follows:
(l) Indebtedness in respect of Capitalized Lease Liabilities incurred in
connection with the leasing of T-1 lines; provided, that the aggregate
amount of all Indebtedness outstanding pursuant to this clause shall not
exceed $110,000,000 during any period after the Total Leverage Ratio set
forth in the Compliance Certificate most recently delivered by the Borrower
to the Administrative Agent pursuant to clause (d) of Section 7.1.1 (after
giving pro forma effect to any such Capitalized Lease Liabilities) was
greater than or equal to 5.00:1;
SECTION 2.2.2. Clause (a)(i) of Section 7.2.4 of the Existing Credit
Agreement is hereby amended by deleting the reference to "50%" appearing
therein and inserting "60%" in replacement therefor.
SECTION 2.2.3. Clause (a)(ii) of Section 7.2.4 of the Existing Credit
Agreement is hereby amended and restated to read in its entirety as follows:
(ii) Minimum ALEs Installed and Billed. Neither the Borrower nor the Parent
will permit the aggregate number of ALEs installed and billed as of the last
day of any Fiscal Quarter set forth below to be less than the amount set
forth opposite such Fiscal Quarter:
Fiscal Quarter ALEs
March 31, 2000 260,000
June 30, 2000 300,000
September 30, 2000 350,000
December 31, 2000 390,000
March 31, 2001 430,000
June 30, 2001 470,000
September 30, 2001 530,000
December 31, 2001 530,000
March 31, 2002 570,000
SECTION 2.2.4. Clause (a)(iii) of Section 7.2.4 of the Existing Credit
Agreement is hereby amended and restated to read in its entirety as follows:
(iii) Minimum Revenue. Neither the Borrower nor the Parent will permit the
revenue received by the Consolidated Group as of the last day of any Fiscal
Quarter set forth below to be less than the amount set forth opposite such
Fiscal Quarter:
Fiscal Quarter Revenue
March 31, 2000 $40,000,000
June 30, 2000 $47,500,000
September 30, 2000 $49,500,000
December 31, 2000 $53,100,000
March 31, 2001 $59,800,000
June 30, 2001 $67,700,000
September30, 2001 $76,900,000
December 31, 2001 $73,100,000
March 31, 2002 $81,500,000
SECTION 2.2.5. Clause (a)(iv) of Section 7.2.4 of the Existing Credit
Agreement is hereby amended and restated to read in its entirety as follows:
(iv) Minimum Consolidated EBITDA. Neither the Borrower nor the Parent will
permit the Consolidated EBITDA as of the last day of any Fiscal Quarter set
forth below to be less than the amount set forth opposite such Fiscal
Quarter:
Period Consolidated EBITDA
March 31, 2000 ($5,400,000)
June 30, 2000 ($5,700,000)
September 30, 2000 ($9,500,000)
December 31, 2000 ($11,800,000)
March 31, 2001 ($10,300,000)
June 30, 2001 ($6,500,000)
September 30, 2001 ($4,400,000)
December 31, 2001 $1,000,000
March 31, 2002 $7,000,000
SECTION 2.2.6. Clause (b)(i) of Section 7.2.4 of the Existing Credit
Agreement is hereby amended and restated to read in its entirety as follows:
(i) Maximum Total Leverage Ratio. Neither the Parent nor the Borrower will
permit the Total Leverage Ratio as of the last day of any Fiscal Quarter
occurring during any period set forth below to be greater than the ratio set
forth opposite such period:
Period Total Leverage Ratio
07/01/01 through (and including) 12/31/01 n/a
01/01/02 through (and including) 03/31/02 13.00:1
04/01/02 through (and including) 06/30/02 6.50:1
07/01/02 through (and including) 09/30/02 4.50:1
10/01/02 through (and including) 03/31/03 4.00:1
04/01/03 and thereafter 3.00:1
SECTION 2.2.7. Clause (b)(iii) of Section 7.2.4 of the Existing Credit
Agreement is hereby amended and restated to read in its entirety as follows:
(iii) Minimum Interest Coverage Ratio. Neither the Parent nor the Borrower
will permit the Interest Coverage Ratio as of the last day of any Fiscal
Quarter occurring during any period set forth below to be less than the
ratio set forth opposite such period:
Period Interest Coverage Ratio
07/01/01 through (and including) 09/30/01 n/a
10/01/01 through (and including) 12/31/01 n/a
01/01/02 through (and including) 03/31/02 1.00:1
04/01/02 through (and including) 06/30/02 1.25:1
07/01/02 through (and including) 09/30/02 1.50:1
10/01/02 through (and including) 12/31/02 2.00:1
01/01/03 through (and including) 03/31/03 2.50:1
04/01/03 and thereafter 3.00:1
SECTION 2.2.8. Clause (b) of Section 7.2.7 of the Existing Credit Agreement
is hereby amended by deleting the grid appearing therein and inserting the
following grid in replacement therefor:
Fiscal Year Capital Expenditure Amount
2001 $175,000,000
2002 $200,000,000
2003 $250,000,000
2004 $250,000,000
2005 $220,000,000
2006 $200,000,000
2007 $200,000,000
2008 $200,000,000
ARTICLE III
CONDITIONS TO EFFECTIVENESS
This Amendment and the amendments contained herein shall become effective on
the date (the "Third Amendment Effective Date") when each of the conditions
set forth in this Article III shall have been fulfilled to the satisfaction
of the Administrative Agent.
SECTION 3.1. Counterparts. The Administrative Agent shall have received
counterparts hereof executed on behalf of the Borrower, the Parent and the
Required Lenders.
SECTION 3.2. Amendment Fee. The Administrative Agent shall have received,
for the account of each Lender executing this Amendment, an amendment fee in
an amount equal to .25% of such Lender's portion of the Total Exposure
Amount.
SECTION 3.6. Legal Details, etc. All documents executed or submitted
pursuant hereto shall be satisfactory in form and substance to the
Administrative Agent and its counsel. The Administrative Agent and its
counsel shall have received all information and such counterpart originals
or such certified or other copies or such materials as the Administrative
Agent or its counsel may reasonably request, and all legal matters incident
to the transactions contemplated by this Amendment shall be satisfactory to
the Administrative Agent and its counsel.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to enter into this Amendment, the Borrower
and the Parent hereby represent and warrant as follows:
SECTION 4.1. Representations and Warranties. In order to induce the Lenders
to execute and deliver this Amendment, the Borrower and the Parent represent
and warrant to the Agents, the Lenders and the Issuer that, after giving
effect to the terms of this Amendment, the following statements are true and
correct: (a) the representations and warranties set forth in Article VI of
the Existing Credit Agreement and in the other Loan Documents are true and
correct on the Third Amendment Effective Date as if made on the Third
Amendment Effective Date (unless stated to relate solely to an earlier date,
in which case such representations and warranties were true and correct in
all material respects as of such earlier date); and (b) no Default has
occurred and has been continuing.
SECTION 4.2. Validity, etc. This Amendment constitutes the legal, valid and
binding obligation of the Borrower and the Parent, enforceable in accordance
with its terms, subject to the effect of any applicable bankruptcy,
insolvency, moratorium or similar laws affecting creditors' rights generally
and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Cross References. References in this Amendment to any article
or section are, unless otherwise specified, to such article or section of
this Amendment.
SECTION 5.2. Loan Document Pursuant to Credit Agreement. This Amendment is a
Loan Document executed pursuant to the Existing Credit Agreement and shall
be construed, administered and applied in accordance with all of the terms
and provisions of the Existing Credit Agreement.
SECTION 5.3. Successors and Assigns. This Amendment shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
SECTION 5.4. Counterparts. This Amendment may be executed by the parties
hereto in several counterparts, all of which shall be deemed to be an
original and which shall constitute together but one and the same agreement.
SECTION 5.5. Expenses. The Borrower hereby agrees to pay to or reimburse the
Administrative Agent, upon demand, all of its reasonable expenses in
connection with the development, negotiation, preparation, execution and
closing of this Amendment, including all reasonable fees and other charges
of ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ in connection therewith.
SECTION 5.6. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers hereunder duly authorized as of the
date and year first above written.
CTC COMMUNICATIONS CORP.
By:_____________________________
Title:
CTC COMMUNICATIONS GROUP, INC.
By:_____________________________
Title:
TORONTO DOMINION (TEXAS), INC.,
as Lender
By:_____________________________
Title:
CREDIT SUISSE FIRST BOSTON,
as Lender
By:_____________________________
Title:
By:_____________________________
Title:
▇▇▇▇▇▇ BROTHERS INC.,
as Lender
By:_____________________________
Title:
▇▇▇▇▇▇ COMMERCIAL PAPER INC.,
as Lender
By:_____________________________
Title:
SYNDICATED LOAN FUNDING TRUST,
as Lender
By:_____________________________
Title:
ING (U.S.) CAPITAL LLC,
as Lender
By:_____________________________
Title:
By:_____________________________
Title:
CISCO SYSTEMS, INC.,
as Lender
By:_____________________________
Title:
RFC CAPITAL CORPORATION,
as Lender
By:_____________________________
Title:
IBM CREDIT CORPORATION,
as Lender
By:_____________________________
Title:
