EXHIBIT 10.19.4
Execution Copy
FOURTH AMENDMENT (this "Amendment"), dated as of March 18, 2002, to the
Credit Agreement, dated as of October 20, 2000, as amended to date (the "Credit
Agreement"), among Cricket Communications Holdings, Inc., Cricket
Communications, Inc., the Lenders party thereto and Ericsson Credit AB, as
Administrative Agent. Terms used herein and not defined herein shall have the
meanings assigned to such terms in the Credit Agreement.
WHEREAS, Holdings and the Borrower have requested that certain
provisions of the Credit Agreement be amended in certain respects, and the
Required Lenders and the Administrative Agent are willing to amend such
provisions on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, for and in consideration of the mutual agreements
contained in this Amendment and other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, the parties hereto
hereby agree as follows:
Section 1. Amendments.
(a) The Table of Contents to the Credit Agreement is hereby amended by
inserting "Schedule 5.19 - - Parent and Subsidiary Licenses" and "Schedule 5.20
- - Further Investments" immediately after "Schedule 3.13 - - Insurance", and by
inserting "Schedule 6.26 - - BTAs in Borrower 40 Market Plan" immediately after
"Schedule 6.08 - - Existing Restrictions".
(b) The Credit Agreement is hereby amended by attaching Exhibit A
hereto as Schedule 5.19 thereto, by attaching Exhibit B hereto as Schedule 5.20
thereto, and by attaching Exhibit C hereto as Schedule 6.26 thereto.
(c) Section 1.01 of the Credit Agreement is hereby amended as follows:
(i) The following definitions are hereby inserted in the
appropriate alphabetical order:
"Additional Contributed FCC Licenses" means the FCC
licenses listed in Section B of Schedule 5.19, any additional
FCC license contributed to a License Subsidiary in accordance
with subparagraphs (d), (e) or (f) of Section 5.19, and an FCC
license for Rochester, New York if and when acquired.
"Parent Group" means Parent and/or each of its
subsidiaries that is not a Loan Party.
"Parent Group Asset Sales" means any sale, transfer
or other disposition of Parent Group assets, excluding sales,
transfers and dispositions: (A) of Permitted Investments and
other current assets; (B) to another Person in the Parent
Group or to a Loan Party; or (C) which, separately or together
with other sales, transfers and dispositions in a group or
series of related sales, transfers and
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange Commission.
dispositions, generates Net Proceeds of less than $500,000.
"Parent Group Capital Event" means any of the
following which occurs after March 1, 2002: (a) any
realization by Parent Group of any cash proceeds in respect of
any investments in Pegaso Comunicaciones, S.A. de C.V.
(whether as a result of a sale of any such investment, any
payment received in respect thereof or otherwise); (b) the
FCC's return to Parent Group of all or any portion of any
deposit paid by Parent Group to the FCC (including in
connection with FCC Auction 35); (c) Parent's issuance of any
Equity Interest, excluding the issuance of Equity Interests in
connection with the exercise of any option to acquire Parent
Equity Interests granted to holders of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
options in connection with the distribution of Parent Equity
Interests by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ in September 1998 or
granted to directors, officers, employees or consultants of
Parent or any of its subsidiaries; and (d) Parent Group Asset
Sales; and (e) the incurrence by Parent Group of Indebtedness
for borrowed money.
(ii) clause (A) of subparagraph (i) of the proviso in the
definition of Eligible Secured Debt is amended to read as follows:
(A) such Indebtedness is incurred, for equipment, within six
months after the later of the acquisition, the completion of
construction and final acceptance or the commencement of full
operation of the relevant equipment, and, for services, within
six months of the completion thereof (or, in the case of
services provided by or on behalf of Lucent, Nortel Networks
Inc. or Ericsson Wireless Communications, Inc., within twelve
months of the completion thereof),
(iii) the definition of "Net Proceeds" is hereby amended by
adding the following to the end thereof:
provided, however, that for purposes of determining Net
Proceeds received by Parent Group in connection with any
event, references in the foregoing provisions of this
definition to the Borrower and the Subsidiary Loan Parties
shall be deemed to be references to the Parent Group, and
references solely to the Borrower shall be deemed to be
references to Parent. Notwithstanding the foregoing: (a) the
Net Proceeds, if any, received by Parent Group in connection
with the transfer of licenses listed in Section E of Schedule
5.19 shall be reduced by the lesser of (i) $1,300,000, and
(ii) the amount of any equity investment made by Parent in
Cricket Licensee (Lakeland), Inc. after March 18, 2002 and
applied to the repayment of the FCC Debt owed by Cricket
Licensee (Lakeland), Inc., (b) Net Proceeds received by any
subsidiary of Parent that is a member of the Parent Group but
that is not a wholly-owned subsidiary (whether owned directly
or indirectly) shall be deemed to be Net Proceeds received by
Parent Group only to the extent such Net Proceeds are received
by Parent or any such wholly-owned subsidiary as cash
proceeds, or are permitted to be transferred to and received
by Parent or any such wholly-owned subsidiary as cash
proceeds, and (c) Net Proceeds, if any, received by Parent
Group in connection with the incurrence of
2
Indebtedness shall be reduced by the sum of (i) $50,000,000,
plus (ii) unless and until Parent's obligation to purchase
licenses pursuant to FCC Auction 35 is irrevocably terminated,
the aggregate amount Parent is obligated to pay to the FCC to
purchase the licenses on which it was the high bidder in FCC
Auction 35, net of any amounts then on deposit by Parent with
the FCC in connection with FCC Auction 35 plus (iii) the Net
Proceeds, calculated without regard to this sentence, of any
Indebtedness incurred by Parent Group to the extent the
proceeds of such Indebtedness are used to refinance other
Indebtedness of the Parent Group.
(iv) the definition of "Permitted Encumbrances" is hereby
amended as follows:
(a) Subparagraph (d) thereof is amended to read as
follows:
(d) pledges of Permitted Investments,
pledges of accounts holding Permitted Investments,
and deposits, in each case, to secure the performance
of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature, in each
case in the ordinary course of business; provided,
that except with respect to up to $2,000,000 of
pledges permitted pursuant to this subparagraph (d),
the value of any pledged assets shall not, in each
case, exceed the minimum value of such pledged assets
that is required by the third party to secure such
obligation;
and
(b) the word "and" at the end of subparagraph (e)
thereof is deleted, the period at the end of subparagraph (f)
thereof is deleted and replaced with a semicolon followed by
the word "and", and a new subparagraph (g) is added thereto
immediately after subparagraph (f) and before the proviso at
the end of such definition to read as follows:
(g) Liens (including pursuant to title
retention and conditional sales agreements) on
personal property purchased (or being purchased) by
any Loan Party after March 22, 2002, to secure
amounts payable to the vendor of such personal
property in respect of the purchase price thereof;
provided that (i) such Liens shall be released (or
title transferred) with respect to any such personal
property upon payment of the purchase price thereof
and (ii) the aggregate amount secured by Liens
described in this subparagraph (or the aggregate
unpaid purchase price for property on which title has
been retained) shall not exceed $75,000,000 at any
time;
(v) The definition of "Prepayment Event" is hereby amended as
follows:
(A) Subparagraph (a) thereof is amended to read as
follows:
3
(a) any sale, transfer, lease or other
disposition (including pursuant to a sale and
leaseback transaction) of any property or asset of
the Borrower or any Subsidiary Loan Party pursuant to
clauses (ii), (vii) and/or (ix) of Section 6.04(b),
excluding sales of Additional Contributed FCC
Licenses to the extent that the Net Proceeds of such
sale of Additional Contributed FCC Licenses are paid
as Restricted Payments pursuant to subparagraphs (g),
(h) and/or (i) of Section 6.06; or
(B) Subparagraph (b) thereof is relettered as
subparagraph (c), and a new subparagraph (b) is added thereto
as follows:
(b) any sale of equipment by Borrower or any
Subsidiary Loan Party pursuant to clause (iii) of
Section 6.04(b); or
(vi) The definition of "Purchase Price" is hereby amended to
read as follows:
"Purchase Price" means amounts paid or payable to
Ericsson pursuant to invoices delivered by Ericsson pursuant
to the Purchase Agreement; provided that [***].
(vii) The definition of "Total Contributed Capital" is hereby
amended by adding the following sentence to the end thereof:
Notwithstanding the foregoing, for the purposes of this
definition of "Total Contributed Capital", the Additional
Contributed FCC Licenses shall be valued in an amount not to
exceed $40,000,000.
(d) Subparagraph (b) of Section 2.09 of the Credit Agreement is amended
to read as follows:
(b) In the event and on each occasion that any Net
Proceeds are received by or on behalf of the Borrower or any
Subsidiary Loan Party after March 1, 2002, in respect of any
Prepayment Event, the Borrower shall, within three Business
Days after such Net Proceeds are received, prepay Eligible
Secured Debt (including Borrowings), ratably in accordance
with the outstanding principal amount thereof, in an aggregate
principal amount equal to such Net Proceeds; provided that (i)
no prepayment shall be required pursuant to this subparagraph
(b) in respect of the first $25,000,000 aggregate amount of
such Net Proceeds received after March 1, 2002 (determined on
a cumulative basis and without regard to Net Proceeds
described in clauses (ii), (iii) and (iv) of this proviso),
(ii) no prepayment shall be required pursuant to this
subparagraph (b) in respect of any Prepayment Event or series
or group of related Prepayment Events if the aggregate amount
of Net Proceeds therefrom is less than $500,000 unless
4
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange Commission.
such Prepayment Event or Prepayment Events involves the sale
or disposition of an FCC License, (iii) no prepayment shall be
required pursuant to this subparagraph (b) in respect of
periodic lease payments (and related lease payments and fees)
received in connection with the lease or sublease of any
surplus or uneconomic real property lease or any excess space
and related assets at any cell site, and (iv) in the case of
any event described in clause (b) of the definition of the
term Prepayment Event (and not described in clause (ii) of
this subparagraph), if the Borrower shall deliver to the
Administrative Agent a certificate of a Financial Officer to
the effect that the Borrower and the Subsidiaries intend to
apply the Net Proceeds from such event (or a portion thereof
specified in such certificate), within 180 days after receipt
of such Net Proceeds, to acquire equipment to be used in the
business of the Borrower and the Subsidiaries, and certifying
that no Default has occurred and is continuing, then no
prepayment shall be required pursuant to this paragraph in
respect of the Net Proceeds in respect of such event (or the
portion of such Net Proceeds specified in such certificate, if
applicable) except to the extent of any such Net Proceeds
therefrom that have not been so applied by the end of such
180-day period, at which time such Net Proceeds will be
treated hereunder as if they were then received as Net
Proceeds for a Prepayment Event not described in clause (b) of
the definition of the term Prepayment Event.
(e) Section 5.01 of the Credit Agreement is hereby amended by deleting
the word "and" at the end of subparagraph (i) thereof, deleting the period at
the end of subparagraph (j) thereof and replacing such period with a semicolon
followed by the word "and", and adding the following new subparagraphs to the
end thereof:
(k) concurrently with the delivery of any financial statements
under clause (a), (b) or (c) above: (i) subscriber information for the
most recently completed month included in such financial statements,
including total subscribers at the beginning of the month, gross
subscriber additions during the month, subscriber disconnects during
the month, total subscribers at the end of the month, cost per gross
add (commonly referred to as CPGA), average revenue per user (commonly
referred to as ARPU), and churn (in each case, as normally reported by
Borrower for internal management reports on the date of such financial
statements); and (ii) the consolidated income statement and cash flow
statement of the Borrower and its Subsidiaries in a form which conforms
in presentation to the Business Plan most recently furnished to the
Administrative Agent and the Lenders pursuant to subparagraph (f) of
this Section 5.01;
(l) promptly after the occurrence thereof, notice of any
Parent Group Capital Event that generates Net Proceeds and that occurs
prior to the date on which (A) the entire $35,000,000 of equity
investments contemplated by Section 5.19(a) have been received or
deemed to be received by each of Holdings and Borrower and (B) all
investments required to be made pursuant to Section 5.20 have been made
(which notice shall include a general description of such event and an
explanation of the Net Proceeds expected to be received in connection
with such event); and
5
(m) notice of any deposit account or investment property of
any of Borrower, Holdings or any Subsidiary Loan Party that is not
perfected through a control agreement in favor of the Collateral Agent,
promptly after the date on which the aggregate value of any such
deposit accounts and investment property exceeds $2,000,000.
(f) Omitted.
(g) Article V of the Credit Agreement is hereby amended by inserting
the following additional Sections at the end of such Article:
SECTION 5.19. Further Capital Contribution in Holdings.
(a) Holdings shall receive from Parent, as an equity
investment by Parent into Holdings, and Borrower shall receive from Holdings, as
an equity investment by Holdings into Borrower, $35,000,000 in cash to be
received as follows:
(i) 50% of the Net Proceeds from any Parent Group
Capital Event, until Holdings shall have received from Parent,
and Borrower shall have received from Holdings, $25,000,000 of
additional equity investments in cash pursuant to this Section
5.19, and thereafter
(ii) 100% of the Net Proceeds from any Parent Group
Capital Event until Holdings shall have received from Parent,
and Borrower shall have received from Holdings, $10,000,000 of
additional equity investments in cash pursuant to this Section
5.19;
in each case, with Holdings receiving from Parent, and Borrower
receiving from Holdings, such amounts within five Business Days of
Parent Group's receipt of such Net Proceeds; provided that an amount
equal to 50% of the Net Proceeds received by any License Subsidiary
from the sale of any Additional Contributed FCC License by such License
Subsidiary prior to the date that the entire amount of the $25,000,000
of additional equity investments required by clause (i) above has been
made shall be credited against such $25,000,000 of equity investments
required pursuant to such clause (i) as if received by each of Holdings
and Borrower.
(b) Parent shall transfer to a License Subsidiary each FCC
license listed in Section B of Schedule 5.19 and owned by Parent as
soon as reasonably practicable, and Parent shall take all reasonable
steps to accomplish such transfer including, without limitation, filing
with the FCC on or before April 8, 2002 applications to transfer
control of such licenses to a License Subsidiary.
(c) On or before April 8, 2002, each FCC license listed in
Section B of Schedule 5.19 and owned by a Person other than Parent
shall be held by a License Subsidiary.
6
(d) If any license transfer transaction pending as of March
18, 2002 and relating to licenses listed in Section D of Schedule 5.19
is abandoned or terminated by any of the parties thereto, Parent shall
transfer to a License Subsidiary each then outstanding FCC license
relating to such transaction listed in Section D of Schedule 5.19 and
owned by Parent as soon as reasonably practicable after such
abandonment or termination, and Parent shall take all reasonable steps
to accomplish such transfer including, without limitation, filing with
the FCC applications to transfer control of such licenses to a License
Subsidiary as soon as reasonably practicable after any such abandonment
or termination.
(e) If any license transfer transaction pending as of March
18, 2002 and relating to licenses listed in Section E of Schedule 5.19
is abandoned or terminated by any of the parties thereto, Parent shall
transfer to a License Subsidiary each then outstanding FCC license
relating to such transaction listed in Section E of Schedule 5.19 and
owned by Parent as soon as reasonably practicable after such
abandonment or termination, and Parent shall take all reasonable steps
to accomplish such transfer including, without limitation, filing with
the FCC applications to transfer control of such licenses to a License
Subsidiary as soon as reasonably practicable after any such abandonment
or termination.
(f) Parent shall transfer to a License Subsidiary each FCC
license listed in Section F of Schedule 5.19 and owned by Parent as
soon as reasonably practicable after the earlier of (i) the date upon
which the Lien to be granted by Parent in the stock of the Cricket
Licensee XI, Inc. in connection with the pending acquisition of the
licenses described in Section C of Schedule 5.19 is released, (ii) the
date upon which such FCC license is transferred from Cricket Licensee
XI, Inc. in accordance with the pledge agreement granting such Lien,
and (iii) the date, if any, on which the pending acquisition of the
licenses listed in Section C of Schedule 5.19 is abandoned or
terminated by any of the parties thereto. Parent shall take all
reasonable steps to accomplish such transfer including, without
limitation, filing with the FCC applications to transfer control of
such licenses to a License Subsidiary as soon as reasonably practicable
after any such abandonment or termination. (In connection with the
pending acquisition of licenses described in Section C of Schedule
5.19, Parent has applied to transfer the licenses listed in Section F
of Schedule 5.19 and owned by Parent to Cricket Licensee XI, Inc.).
(g) The FCC License listed in Section F of Schedule 5.19 and
owned by MCG PCS Licensee Corporation, Inc. shall be held by a License
Subsidiary within five Business Days after the earlier of (i) June 15,
2002 and (ii) the date on which MCG PCS, Inc. ceases to have a Lien on
the stock of MCG PCS Licensee Corporation, Inc.
(h) If any additional License Subsidiary is formed in
connection with the requirements of this Section 5.19, the Borrower
will cause the Collateral and Guarantee Requirement to be satisfied
with respect to such License Subsidiary and will otherwise cause all
actions required by Section 5.11 hereof with respect to such License
Subsidiary to occur.
7
SECTION 5.20. Further Investments.
(a) Subject to subparagraph (b) below (i) Parent
shall invest as equity investments in the corporations listed
in Schedule 5.20, in cash, an aggregate amount equal to the
lesser of $22,875,280.58 or the amounts required to provide
such corporations with sufficient cash balances to fund their
remaining 2003 debt service obligations with respect to FCC
Debt, and (ii) Parent shall invest in Permitted Investments to
be held in an account separate from other Parent investments,
an amount equal to the lesser of $2,395,216.30 or the amount
required to provide a sufficient balance in such separate
account to fund the remaining 2003 debt service obligations on
the secured note Parent is to issue in connection with its
purchase of the FCC licenses described in Section C of
Schedule 5.19, provided that if the license transfer
transaction relating to such FCC licenses is abandoned or
terminated by any of the parties thereto, Parent shall use
such amounts to fund the remaining 2003 debt service
obligations on the FCC licenses listed in Section D of
Schedule 5.19.
(b) Parent shall be obligated to make the investments
described in subparagraph (a) above, on a pro rata basis, only
if and to the extent the following amounts become available:
(i) Net Proceeds from Parent Group Capital Events in excess of
the sum of $25,000,000 plus the amounts required to be
invested by Parent into Holdings pursuant to Section 5.19(a),
and (ii) Restricted Payments made pursuant to clause (h) of
Section 6.06.
(c) Parent shall use the Permitted Investments
described in subparagraph (a)(ii) above, to the extent
available, to pay the Parent debt service obligations
described in subparagraph (a)(ii) above, until such debt
service obligations are paid in full.
SECTION 5.21. Additional Investment for Outstanding Note.
After March 18, 2002, Parent shall invest $20,019,618.85 pursuant to
this Section 5.21 in Permitted Investments to be held in an account
separate from other Parent investments. Parent shall use the Permitted
Investments described in this Section to pay (a) the debt service
payments that become due in 2002 under the note Parent issued in
connection with its purchase of MCG PCS Licensee Corporation, Inc. and
an FCC license, and (b) the debt service payments that become due in
2002 on the secured note Parent is to issue in connection with its sale
of the FCC licenses described in Section D of Schedule 5.19 (or, if any
FCC Debt payments become due in 2002 with respect to such FCC licenses
prior to the date such licenses are sold, to pay such FCC Debt
payments), until such payments have been paid.
(h) The first paragraph of subparagraph (b) of Section 6.04 of the
Credit Agreement is hereby amended to read as follows:
8
(b) The Borrower will not, nor will it permit any Subsidiary Loan Party
to, sell, transfer, lease or otherwise dispose of any asset, including any
Equity Interest in any other Person owned by it, except:
(i) sales and other dispositions of inventory in the
ordinary course of business;
(ii) sales, transfers, leases and other dispositions
of obsolete, uneconomic or surplus assets in the ordinary
course of business (including (A) leasing and subleasing
excess space and related assets at any cell site and (B) the
sale of any FCC License which has not been utilized on or
after March 1, 2002 to provide service to subscribers in a
market launched by or on behalf of Borrower, but excluding (X)
any sale, transfer, lease or disposition of an FCC License
which was utilized on or after March 1, 2002 to provide
service to subscribers in a market launched by or on behalf of
Borrower and (Y) sales of equipment described in clause (iii)
below);
(iii) sales of obsolete, uneconomic or surplus
equipment in the ordinary course of business;
(iv) transfers constituting investments permitted by
paragraph (a) of this Section or Restricted Payments permitted
by Section 6.06;
(v) sales, transfers and dispositions by the Borrower
or a Subsidiary to the Borrower or a Subsidiary;
(vi) swaps by License Subsidiaries of one or more FCC
Licenses that are not being utilized to provide service to
subscribers in a market launched by or on behalf of Borrower
in exchange for an equal number of FCC licenses, with each FCC
license received by a License Subsidiary in any such swap
having an identical coverage area and equal or greater
bandwidth than the corresponding FCC License disposed of in
such swap; and with no consideration involved other than the
swapped licenses;
(vii) with the consent of the Administrative Agent,
the sale and other disposition of cell site towers and poles
(and assets relating to such towers and poles, including real
property leases) and the leaseback of a portion thereof;
(viii) sales and other dispositions of Permitted
Investments in the ordinary course of business; and
(ix) other sales and dispositions by the Borrower and
the Subsidiaries of assets (other than Equity Interests in any
Subsidiary) with a fair market value not exceeding, in the
aggregate, $1,000,000 during any fiscal year of the Borrower;
9
provided that (A) all sales and other dispositions of inventory
pursuant to clause (i) above shall be made for fair value in the
context of industry practices and, other than in connection with
exchanges for other inventory and marketing and promotional events,
shall be made solely for cash consideration, (B) all sales, transfers,
leases and other dispositions permitted hereby, other than pursuant to
clauses (i) and (v) above, shall be made for fair value; and (C) all
sales, transfers, leases and other dispositions permitted by clauses
(ii), (iii), (vii) and (ix) above shall be made solely for cash
consideration, the assignment or transfer of liabilities associated
with the disposed assets and, with respect to leases pursuant to clause
(ii) above, a fair market lease agreement. For purposes of this
Agreement, cash consideration includes short-term accounts receivable
payable solely in cash.
(i) Section 6.06 of the Credit Agreement is hereby amended by deleting
the word "and" at the end of clause (e) thereof, deleting the period at the end
of clause (f) thereof and replacing such period with a semicolon followed by the
word "and" and adding the following new clauses to the end thereof as follows:
(g) any License Subsidiary that receives any Net Proceeds from the sale
of any Additional Contributed FCC License prior to the date that the
entire $25,000,000 of equity investments contemplated by clause (i) of
Section 5.19(a) have been received or deemed to be received by each of
Holdings and Borrower may pay a dividend to Parent in an amount equal
to 50% of such Net Proceeds from such sale; provided that (i) the
aggregate amount of dividends paid by License Subsidiaries pursuant to
this clause (g) shall not exceed $25,000,000, and (ii) Parent shall
have invested the Net Proceeds of Parent Group Capital Events, if any,
pursuant to clause (a)(i) of Section 5.19 before dividends are paid
pursuant to this clause (g);
(h) any License Subsidiary that receives any Net Proceeds from the sale
of any Additional Contributed FCC License after the entire $35,000,000
of equity investments contemplated by Section 5.19(a) have been
received or deemed to be received by each of Holdings and Borrower, and
prior to the date that all investments required to be made pursuant to
Section 5.20 have been made, may pay a dividend to Parent in an amount
equal to such Net Proceeds received from such sale; provided that (i)
dividends may be paid pursuant to this clause (h) only for the purpose
of funding investments required to be made pursuant to Section 5.20,
(ii) no dividends shall be permitted by this clause (h) after all such
investments required to be made pursuant to Section 5.20 have been made
and (iii) Parent Group shall have invested the Net Proceeds of Parent
Group Capital Events, if any, pursuant to clause (b)(i) of Section 5.20
to make such equity investments before dividends are paid pursuant to
this clause (h); and
(i) any License Subsidiary may make a cash dividend to Parent at any
time if (x) no Default has occurred and is continuing or would result
therefrom, (y) after giving effect to such dividend, such License
Subsidiary will have sufficient cash balances to pay all of its debt
service obligations with respect to FCC Debt that will become due and
payable after the date of such dividend through the end of 2003, and
(z) the proceeds of such dividend are contemporaneously invested as
equity by Parent in Holdings and by
10
Holdings in Borrower.
(j) Section 6.11 of the Credit Agreement is hereby amended by adding
the following proviso to the end thereof:
provided, however, that this Section 6.11 shall not restrict Borrower
or any Real Estate Subsidiary from selling and then renting or leasing
space on any tower, pole or real estate sold, transferred or otherwise
disposed pursuant to clause (vii) of Section 6.04(b).
(k) Section 6.13 of the Credit Agreement is amended by adding the
following new sentence to the end thereof:
The parties hereto understand that any wholly-owned subsidiary of
Parent that otherwise satisfies all of the requirements set forth in
clauses (a) through (d) of this Section 6.13, except that it owns one
or more FCC licenses (but no FCC Licenses prior to the actions
contemplated by this sentence), shall, upon satisfaction of the
Collateral and Guarantee Requirement and delivery of a counterpart of a
supplement to the Subordination Agreement duly executed and delivered
on behalf of such subsidiary, be deemed to be a License Subsidiary. The
provisions of this Section 6.13 shall not prohibit a License Subsidiary
from entering into agreements to sell an FCC License or agreements to
purchase a license that becomes an FCC License upon acquisition by such
License Subsidiary, in each case if and to the extent such sale or
purchase is otherwise permitted by this Agreement.
(l) Section 6.15 of the Credit Agreement is hereby amended to read as
follows:
SECTION 6.15. Capital Expenditures. The Borrower will not
permit the aggregate amount of Capital Expenditures made by the
Borrower and its Subsidiaries in any fiscal year to exceed the amount
set forth below with respect to such fiscal year:
Year Amount
2000 $ 396,000,000
2001 $ 1,004,000,000
2002 $ 170,000,000 plus the excess, if any, of (i)
$1,004,000,000 minus (ii) the aggregate amount of
Capital Expenditures made by the Borrower and its
Subsidiaries in fiscal year 2001
2003 $ 180,000,000
2004 and thereafter $ 100,000,000
(m) Section 6.19 of the Credit Agreement is hereby amended to read as
follows:
SECTION 6.19. Total Indebtedness to Annualized EBITDA. The
Borrower will
11
not permit the ratio of Total Indebtedness to Annualized EBITDA as of
the last day of any fiscal quarter ending during any period set forth
below to exceed the ratio set forth below opposite such period:
Period Ratio
April 1, 2003 to and including June 30, 2003 10.0 to 1.0
July 1, 2003 to and including September 30, 2003 7.0 to 1.0
October 1, 2003 to and including December 31, 2003 5.5 to 1.0
Thereafter 5.0 to 1.0
(n) Section 6.20 of the Credit Agreement is hereby amended to read as
follows:
SECTION 6.20. Consolidated EBITDA to Cash Interest Expense.
The Borrower will not permit the ratio of Consolidated EBITDA to Cash
Interest Expense for any period of four consecutive fiscal quarters
ending during any period set forth below to be less than the ratio set
forth opposite such period:
Period Ratio
January 1, 2003 to and including March 31, 2003 1.3 to 1.0
April 1, 2003 to and including June 30, 2003 1.4 to 1.0
July 1, 2003 to and including September 30, 2003 1.5 to 1.0
October 1, 2003 to and including December 31, 2003 1.9 to 1.0
January 1, 2004 and thereafter 3.0 to 1.0
(o) Article VI of the Credit Agreement is hereby amended by inserting
the following additional Sections at the end of such Article:
SECTION 6.25. Minimum Consolidated EBITDA. The Borrower will
not permit Consolidated EBITDA for any fiscal quarter set forth below to be less
than the amount set forth below opposite such fiscal quarter:
Period Amount
April 1, 2002 to and including June 30, 2002 - $27,000,000
July 1, 2002 to and including September 30, 2002 $0
October 1, 2002 to and including December 31, 2002 $9,000,000
January 1, 2003 to and including March 31, 2003 $45,000,000
12
SECTION 6.26. New Market Launches Restricted. From March 15,
2002 until June 30, 2003, in any BTA other than the BTAs listed in
Schedule 6.26, Borrower shall not, directly or indirectly, and shall
not permit any Subsidiary Loan Party to, directly or indirectly (a)
order any equipment for deployment, (b) commence site acquisition or
construction of any cell site or retail store location, (c) launch
commercial wireless service, (d) incur any expenses for marketing or
advertising, (e) incur any expenses relating to obtaining retail space,
(f) incur any expenses for operation of commercial wireless services,
or (g) incur any material expenses for pre-launch activities other than
marketing studies and radio frequency planning; provided, however, that
the provisions of this Section 6.26 shall not be interpreted to prevent
Borrower from meeting the minimum requirements set forth in Code of
Federal Regulations, Volume 47, Section 24.203 (or any successor law or
regulation) with respect to any FCC License with an initial build-out
date on or before June 30, 2004, or to prevent Borrower from providing
services for fair consideration to any Person other than a Loan Party
in connection with the launch, preparation for launch or operation of
commercial wireless service pursuant to one or more licenses owned by
any Person other than a Loan Party.
(p) Clause (o) of Article VII of the Credit Agreement is hereby amended
to read as follows:
(o) the loss, revocation, suspension or material impairment of
any material FCC License shall occur (it being understood that no
Additional Contributed FCC License shall be considered to be a material
FCC License prior to the date such FCC License is utilized to provide
service to subscribers in a market launched by or on behalf of
Borrower); or
(q) Subparagraph (b) of Section 9.04 of the Credit Agreement is hereby
amended as follows:
(a) Clause (iii) of such subparagraph is amended by replacing
the amount "$5,000,000" contained therein with the amount "$3,000,000".
(b) subparagraph (B) of the proviso to such subparagraph is
amended to read as follows:
(B) any consent of the Borrower otherwise required
under clause (iii) of this paragraph shall not be unreasonably
withheld if, after April 1, 2002, the Borrower consents to an
assignment of less than $3,000,000 relating to the Lucent
Credit Agreement or any credit, loan or similar agreement
relating to any other Eligible Secured Debt and
Section 2. Limited Waivers.
(a) The Borrower previously entered into and maintained in effect
Hedging Agreements with the effect required by Section 5.14 of the Credit
Agreement. The undersigned
13
Lenders hereby waive the requirement that such Hedging Agreements be
satisfactory to the Required Lenders prior to the Amendment Effective Date.
(b) The undersigned Lenders hereby waive the provisions of Section 6.13
of the Credit Agreement to the extent necessary to permit:
(i) Cricket Licensee (Reauction), Inc. to own the FCC License
for Omaha, NE although such license is financed with FCC Debt; and
(ii) each of Chasetel Licensee Corp. and Cricket Licensee
(North Carolina), Inc. to own more than one FCC License financed with
FCC Debt;
provided that such License Subsidiaries transfer FCC Licenses, as soon as
reasonably practicable after April 30, 2002 to other License Subsidiaries as
contemplated by Exhibit B hereto so that each FCC License that is financed with
FCC Debt is owned by a License Subsidiary in accordance with the provisions of
Section 6.13 of the Credit Agreement, and each such License Subsidiary shall
take all reasonable steps to accomplish such transfers including, without
limitation, filing with the FCC on or before April 8, 2002 applications to
transfer control of the applicable FCC Licenses to other License Subsidiaries,
provided, further, however, that Chasetel Licensee Corp. need not act to
transfer its FCC Licenses listed in Section D of Exhibit A hereto to other
License Subsidiaries until three Business Days after the currently pending
license transfer transaction relating to such FCC Licenses is abandoned or
terminated by the parties thereto.
(c) The waivers set forth in this Section 2 are for the limited
purposes set forth herein and are limited strictly as written, and shall not
obligate the undersigned Lenders to enter into or provide any future amendment,
consent, waiver or departure from the terms and conditions of the Credit
Agreement.
Section 3. Approval of Form of Intercompany Agreement and Hedging
Agreements.
(a) As contemplated by Section 6.10 of the Credit Agreement, the
undersigned Lenders hereby approve the form of Intercompany Agreement to be
entered into between Parent and individual License Subsidiaries attached hereto
as Exhibit D.
(b) The Administrative Agent hereby confirms that the five Hedging
Agreements previously delivered to it by the Borrower are satisfactory to the
Administrative Agent. Each undersigned Lender agrees that such Hedging
Agreements are satisfactory to such Lender.
Section 4. Consent to Transfer of Lakeland License. In connection with
the proposed license transfer transaction previously disclosed in writing to the
Administrative Agent, the undersigned Lenders waive the provisions of Sections
6.03(a) and 6.04(b) of the Credit Agreement to the extent necessary to permit
Cricket Licensee (Lakeland), Inc. to transfer its FCC License covering Lakeland,
FL in connection with such transaction provided that simultaneously with such
14
transfer, an FCC license for another BTA as specified in such writing is
transferred to a License Subsidiary, with such transfers to occur substantially
as described to the Administrative Agent.
Section 5. Control Agreements. Within forty-five days of the Amendment
Effective Date, or such longer period of time approved by the Administrative
Agent, Holdings and Borrower agree to enter into, and to cause each Subsidiary
Loan Party to enter into, at the request of the Administrative Agent, control
agreements relating to the deposit accounts and investment property identified
pursuant to subparagraph (h) of Section 7 of this Amendment, which control
agreements shall be in form and substance reasonably satisfactory to the
Administrative Agent and pursuant to which the Collateral Agent's Lien in and to
such deposit accounts and investment property shall be perfected.
Section 6. Representations and Warranties. Holdings and the Borrower
hereby represent and warrant to the Lenders and the Administrative Agent that
(a) this Amendment has been duly authorized, executed and delivered by Holdings
and the Borrower and each of this Amendment and the Credit Agreement as amended
hereby constitutes a legal, valid and binding obligation of Holdings and the
Borrower, enforceable in accordance with its terms, (b) as of the date hereof,
and after giving effect to this Amendment, no Default has occurred and is
continuing, (c) the representations and warranties of Holdings and the Borrower
contained in the Credit Agreement are true and correct as if made on the date
hereof and (d) each BTA in which Cricket had launched service to customers as of
March 15, 2002 is listed on Exhibit C of this Amendment.
Section 7. Conditions to Effectiveness. This Amendment shall become
effective (the "Amendment Effective Date") as of the date first set forth above
only upon the occurrence of the following conditions precedent:
(a) the Administrative Agent shall have received from Holdings, the
Borrower and the Required Lenders duly executed counterparts of this Amendment,
(b) the Administrative Agent shall have received from Borrower true and
correct copies of amendments to each of the Lucent Credit Agreement and the
Nortel Credit Agreement which amend such agreements in substantively the same
manner as the Credit Agreement is amended hereby (and, as contemplated by
Section 9.09 of the Collateral Agency Agreement, each undersigned Lender
consents to such amendments), and each of such amendments shall become effective
concurrently with this Amendment on the Amendment Effective Date;
(c) the Administrative Agent shall have received all amounts due and
payable under this Amendment and the Credit Agreement on or prior to the
Amendment Effective Date, including, to the extent invoiced, all reasonable out
of pocket expenses of the Administrative Agent (including, without limitation,
the reasonable fees of Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel for the
Administrative Agent);
(d) Holdings shall have received from Parent, as an equity investment
by Parent into Holdings, and Borrower shall have received from Holdings, as an
equity investment by Holdings into Borrower, in each case, after March 18, 2002,
$85,000,000 in cash;
15
(e) after March 18, 2002, Parent shall have invested at least
$5,766,879.27 as equity investments in the License Subsidiaries listed in
Exhibit E hereto in accordance with the provisions of such Exhibit, and shall
have invested $20,019,618.85 in Permitted Investments to be held in an account
separate from other Parent investments as contemplated by Section 5.21 of the
Credit Agreement as amended hereby;
(f) Borrower shall have paid to the Administrative Agent, for the
account of the Lenders specified in Section 8 of this Amendment, the fee
described in such Section;
(g) the Parent Agreement shall have been amended, in a manner
satisfactory to the Administrative Agent, to include therein (i) as obligations
of Parent, each action that subparagraph (g) of Section 1 of this Amendment
requires or contemplates that Parent will take, and (ii) Parent's agreement to
invest as equity in Holdings, and to cause Holdings to invest as equity in
Borrower, the cash proceeds of any dividend paid by a License Subsidiary
pursuant to clause (i) of Section 6.06 of the Credit Agreement, and the
undersigned Lenders hereby consent to such amendment; and
(h) Borrower shall have delivered to the Administrative Agent a listing
of all deposit accounts and investment property maintained by Holdings, Borrower
or any Subsidiary Loan Party that is not currently subject to a control
agreement in favor of the Collateral Agent.
Section 8. Amendment Fees. The Borrower shall pay to the Administrative
Agent, for the account of each Lender which has delivered a counterpart of this
Amendment duly executed by such Lender to the Administrative Agent on or before
March 22, 2002 (or such later date as the Borrower shall agree), a fee in the
amount of [***] of the sum of all outstanding Loans held by such
Lender plus the Commitment of such Lender. Such fees may not be financed with
Loans. Borrower shall pay such fee to the Administrative Agent on the Amendment
Effective Date, provided that if the Amendment Effective Date occurs prior to
March 22, 2002 (or such later date as agreed to by Borrower) then (a) Borrower
shall pay such fee to the Administrative Agent on the Amendment Effective Date
with respect to any Lender who delivered a duly executed counterpart of this
Amendment to the Administrative Agent on or before the Amendment Effective Date,
and (b) shall pay such fee to the Administrative Agent within three Business
Days of March 22, 2002 (or such later date as the Borrower shall agree) with
respect to any Lender who delivered a duly executed counterpart of this
Amendment to the Administrative Agent after the Amendment Effective Date but on
or prior to March 22, 2002 (or such later date as the Borrower shall agree).
Section 9. Applicable Law. THIS AMENDMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
Section 10. Credit Agreement. Except as expressly amended hereby, the
Credit Agreement shall continue in full force and effect in accordance with the
provisions thereof. Any reference in the Credit Agreement, or in any documents
or instruments required thereunder or annexes or schedules thereto, referring to
the Credit Agreement shall be deemed to refer to the Credit Agreement as amended
by this Amendment.
16
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange Commission.
Section 11. Expenses. The Borrower agrees to reimburse the
Administrative Agent for its out-of-pocket expenses in connection with this
Amendment, including the fees, charges and disbursements of Milbank, Tweed,
▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel for the Administrative Agent.
Section 12. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute but one contract. Delivery of an executed
counterpart of a signature page by facsimile transmission shall be effective as
delivery of a manually executed counterpart of this Amendment.
17
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers as of the day and year
first written above.
CRICKET COMMUNICATIONS HOLDINGS, INC. CRICKET COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------- ----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------- ----------------------------------
Title: President and COO Title: President and COO
--------------------------------- ----------------------------------
ABN AMRO BANK N.V., ABN AMRO BANK N.V.,
INDIVIDUALLY AND AS ADMINISTRATIVE INDIVIDUALLY AND AS ADMINISTRATIVE
AGENT AGENT
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ By: /s/ SKILPA ▇▇▇▇▇▇▇▇▇▇
--------------------------------- ----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ Name: Skilpa ▇▇▇▇▇▇▇▇▇▇
--------------------------------- ----------------------------------
Title: Group Vice President Title:Assistant Vice President
--------------------------------- ----------------------------------
ERICSSON CREDIT AB ERICSSON CREDIT AB
By: /s/ ▇▇▇▇▇ EVERUM By: /s/ PETTER JARTHY
--------------------------------- ----------------------------------
Name: ▇▇▇▇▇ Everum Name: Petter Jarthy
--------------------------------- ----------------------------------
Title: Title:
--------------------------------- ----------------------------------
18
EXHIBIT A
Schedule 5.19
Parent and Subsidiary Licenses
(as of March 18, 2002)
19
A. LICENSES IN COLLATERAL POOL
CHANNEL COLLATERAL 1ST BUILD 01APOPS
BTA MARKET NAME STATE BLOCK MHZ CALL SIGN NAME OF LICENSEE POOL OUT DATE (EASI)
44 Birmingham AL C2 15 WPOJ689 Cricket Licensee (Reauction) Inc. X 6/30/04 1,328,593
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ C2 15 WPOJ696 Cricket Licensee (Reauction) Inc. X 6/30/04 255,315
140 Fayetteville-
Springdale-
Rogers AR C3 10 WPQW523 Cricket Licensee (Reauction) Inc. X 7/22/04 332,638
153 Ft. ▇▇▇▇▇ AR C3 10 WPQW521 Cricket Licensee (Reauction) Inc. X 7/22/04 330,029
▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C2 15 WPOK585 Cricket Licensee (Reauction) Inc. X 7/22/04 140,502
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ C5 10 WPOK569 Cricket Licensee (Reauction) Inc. X 9/29/04 182,637
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇ C2 15 WPQW518 Cricket Licensee (Reauction) Inc. X 7/22/04 971,470
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ C3 10 WPQW520 Cricket Licensee (Reauction) Inc. X 7/22/04 154,091
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C5 10 WPRT965 Cricket Licensee (Reauction) Inc. X 6/30/04 3,539,920
▇▇▇ ▇▇▇▇▇▇ ▇▇ C2 15 WPOK603 Cricket Licensee (Reauction) Inc. X 7/22/04 857,246
291 Merced CA C2 15 WPOK590 Cricket Licensee (Reauction) Inc. X 7/22/04 230,409
303 Modesto CA C2 15 WPOK591 Cricket Licensee (Reauction) Inc. X 7/22/04 507,675
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF734 Cricket Licensee (Reauction) Inc. X 1/22/02 503,948
▇▇▇ ▇▇▇▇▇▇/▇▇▇▇▇▇▇ ▇▇ F 10 KNLG213 Cricket Licensee (Denver) Inc. X 4/28/02 2,759,099
149 Ft. ▇▇▇▇▇▇▇ CO F 10 KNLH357 Cricket Licensee (Reauction) Inc. X 4/28/02 256,324
172 Greeley CO F 10 KNLH358 Cricket Licensee (Reauction) Inc. X 4/28/02 184,429
366 Pueblo CO C3 10 WPQW522 Cricket Licensee (Reauction) Inc. X 7/22/04 316,376
366 Pueblo CO C5 10 WPSI353 Cricket Licensee (Reauction) Inc. X 7/22/04 ---
92 Columbus GA C2 15 WPRW645 Cricket Licensee (Reauction) Inc. X 6/30/04 366,390
▇▇▇ ▇▇▇▇▇ ▇▇ C2 15 WPRW646 Cricket Licensee (Reauction) Inc. X 6/30/04 668,632
50 Boise-Nampa ID C2 15 WPRV980 Cricket Licensee (Reauction) Inc. X 7/22/04 596,255
▇▇▇ ▇▇▇▇▇▇ ▇▇ C1 15 WPSP592 Cricket Licensee (Reauction) Inc. X 6/30/04 461,865
135 Evansville IN F 10 KNLG697 Cricket Licensee (Reauction) Inc. X 4/28/02 524,945
155 Ft. ▇▇▇▇▇ IN E 10 WPOJ708 Cricket Licensee (Reauction) Inc. X 6/30/04 720,322
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C2 15 WPQW517 Cricket Licensee (Reauction) Inc. X 7/22/04 660,794
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ F 10 KNLH652 Cricket Licensee (Reauction) Inc. X 4/28/02 165,216
5 Adrian MI C1 15 KNLF487 Cricket Licnesee (Reauction), Inc. X 11/4/01 99,413
5 Adrian MI D 10 KNLG673 Cricket Licensee (Reauction) Inc. X 4/28/02 ----
33 Battle Creek MI C1 15 KNLF488 Cricket Licensee I, Inc. X 11/4/01 241,424
33 Battle Creek MI D 10 KNLF898 Cricket Licensee II, Inc. X 6/27/02 ----
▇▇▇ ▇▇▇▇▇ ▇▇ D 10 KNLG663 Cricket Licensee (Reauction) Inc. X 4/28/02 508,496
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ C1 15 KNLF500 Cricket Licensee (Reauction) Inc. X 11/4/01 1,090,913
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ D 10 KNLG664 Cricket Licensee II, Inc. X 6/27/02 ----
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF505 Cricket Licensee (Reauction) Inc. X 11/4/01 205,759
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ D 10 KNLG665 Cricket Licensee II, Inc. X 4/28/02 ----
223 Kalamazoo MI D 10 KNLG666 Cricket Licensee II, Inc. X 4/28/02 379,353
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ D 10 KNLF667 Cricket Licensee II, Inc. X 4/28/02 510,831
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ D 10 KNLG668 Cricket Licensee (Reauction) Inc. X 4/28/02 138,096
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF516 Cricket Licensee (Reauction) Inc. X 11/4/01 226,631
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ D 10 KNLG669 Cricket Licensee II, Inc. X 4/28/02 ----
▇▇▇ ▇▇▇▇▇▇▇-▇▇▇ ▇▇▇▇ ▇▇ D 10 KNLG670 Cricket Licensee II, Inc. X 4/28/02 640,657
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ D 10 KNLG671 Cricket Licensee (Reauction) Inc. X 4/28/02 250,103
▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Cricket Licensee IV, Inc. X 4/28/02 414,915
210 Jackson MS E 10 KNLF890 Cricket Licensee (Reauction) Inc. X 4/28/02 682,055
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Cricket Licensee (Reauction) Inc. X 4/28/02 61,651
74 Charlotte NC F 10 KNLF882 Cricket Licensee (North Carolina), Inc. X 4/28/02 2,107,435
▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇-▇▇▇▇▇ ▇▇ F 10 KNLG279 Cricket Licensee (North Carolina), Inc. X 4/28/02 1,469,394
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ F 10 KNLG280 Cricket Licensee (North Carolina), Inc. X 4/28/02 345,317
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C2 15 WPOJ805 Cricket Licensee (Reauction) Inc. X 6/30/04 349,510
▇▇▇ ▇▇▇▇▇ ▇▇ F 10 KNLG684 Cricket Licensee (Reauction) Inc. X 4/28/02 998,073
8 Albuquerque NM C2 15 WPOK572 Cricket Licensee (Reauction) Inc. X 7/22/04 842,451
▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇ C2 15 WPOK601 Cricket Licensee (Reauction) Inc. X 7/22/04 222,016
372 Reno NV C5 10 WPRT966 Cricket Licensee (Reauction) Inc. X 6/30/04 601,268
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ C2 15 WPOJ772 Cricket Licensee (Reauction) Inc. X 6/30/04 780,393
453 Utica NY F 10 KNLF920 Cricket Licensee (Reauction) Inc. X 4/28/02 298,911
▇▇▇ ▇▇▇▇▇▇ ▇▇ F 10 KNLF998 Cricket Holdings (Dayton), Inc. X 6/27/02 1,221,056
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF523 Cricket Licensee (Reauction) Inc. X 11/4/01 139,491
444 Toledo OH C1 15 KNLF528 Cricket Licensee (Reauction) Inc. X 11/4/01 789,824
448 Tulsa OK C2 15 WPOK604 Cricket Licensee (Reauction) Inc. X 7/22/04 958,093
133 Eugene OR C3 10 WPTI886 Cricket Licensee (Reauction) Inc. X 6/30/04 325,831
▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇-
▇▇▇▇▇▇▇▇▇ ▇▇ C2 15 WPRV979 Cricket Licensee (Reauction) Inc. X 7/22/04 534,999
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ E 10 KNLH427 Cricket Licensee (Pittsburgh) Inc. X 4/28/02 2,469,722
76 Chattanooga TN C1 15 KNLF459 CHASETEL LICENSEE CORP X 9/17/01 572,258
83 Clarksville/
Hopkinsville TN C1 15 KNLF460 CHASETEL LICENSEE CORP X 9/17/01 268,476
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF466 CHASETEL LICENSEE CORP X 9/17/01 1,130,516
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF467 CHASETEL LICENSEE CORP X 9/17/01 1,565,645
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF469 CHASETEL LICENSEE CORP X 9/17/01 1,785,651
365 Provo-Orem UT C2 15 WPQW519 Cricket Licensee (Reauction) Inc. X 7/22/04 384,722
399 Salt Lake City UT C2 15 WPQW516 Cricket Licensee (Reauction) Inc. X 7/22/04 1,652,234
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C2 15 WPOK602 Cricket Licensee (Reauction) Inc. X 7/22/04 751,212
18 Appleton-OshKosh WI E 10 KNLG966 Cricket Licensee (Reauction), Inc. X 4/28/02 456,172
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Cricket Licensee (Reauction), Inc. X 4/28/02 196,580
▇▇▇ ▇▇ ▇▇▇▇▇▇-
▇▇▇▇▇▇ WI/MN D 10 KNLG983 Cricket Licensee (Reauction), Inc. X 4/28/02 322,112
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇-
▇▇▇▇▇▇▇▇▇▇ ▇▇ D 10 KNLG991 Cricket Licensee (Reauction), Inc. X 4/28/02 215,593
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇-
▇▇▇▇▇▇▇▇▇▇ ▇▇ E 10 KNLG253 Cricket Licensee (Reauction), Inc. X 4/28/02 ----
SUBTOTAL 46,220,372
19A
B. LICENSES NOT IN COLLATERAL POOL (EXCLUDING LICENSES LISTED ON FOLLOWING
PAGES)
COLLATERAL
POOL X=YES
CHANNEL CALL (X)=BEING 1ST BUILD- DATE 01 POPS 01GPOPS
BTA MARKET NAME STATE BLOCK MHZ SIGN NAME OF LICENSEE TRANSFERRED OUT DATE FILED (EASI) (EASI)
14 Anchorage AK C 30 WPOK573 Leap Wireless International 7/22/04 461,478
49 Blythevelle AR C2 15 WPOK574 Leap Wireless International 7/22/04 71,601
140 Fayetteville-
Springdale-
Rogers AR C4, C5 20 WPOK580 Leap Wireless International 7/22/04 332,638
153 Ft. ▇▇▇▇▇ AR C4, C5 20 WPOK581 Leap Wireless International 7/22/04 330,029
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇ C4 5 WPOK589 Leap Wireless International 7/22/04 971,470
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ C4 10 WPOK594 Leap Wireless International 7/22/04 154,091
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ C2 15 WPOK598 Leap Wireless International 7/22/04 99,561
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇,▇▇ 20 WPOK592 Leap Wireless International 7/22/04 39,108
6 Albany GA C2 15 WPOJ838 Cricket Licensee (Albany),
Inc. 6/30/04 357,815
92 Columbus GA C1 15 WPOJ839 Cricket Licensee (Columbus),
Inc. 6/30/04 366,390
▇▇▇ ▇▇▇▇▇ ▇▇ C1 15 WPOJ841 Cricket Licensee (Macon),
Inc. 6/30/04 668,632
50 Boise-Nampa ID C1 15 WPOK575 Leap Wireless International 7/22/04 596,255
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ C2 15 WPOK586 Leap Wireless International 7/22/04 225,322
250 Lewiston-
Moscow ID C1 15 WPOK588 Leap Wireless International 7/22/04 124,661
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ C2 15 WPOK605 Leap Wireless International 7/22/04 164,293
88 Coffeyville KS C2 15 WPOK578 Leap Wireless International 7/22/04 61,365
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Leap Wireless International 4/28/02 To Expire ---- 47,227
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ E 10 KNLG977 Leap Wireless International 4/28/02 To Expire ---- 45,768
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ D 10 KNLG979 Leap Wireless International 4/28/02 To Expire ---- 31,989
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Leap Wireless International 4/28/02 To Expire ----
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Leap Wireless International 4/28/02 To Expire ---- 74,328
409 Sault Ste.
▇▇▇▇▇ MI D 10 KNLG988 Leap Wireless International 4/28/02 To Expire ---- 58,007
409 Sault Ste.
▇▇▇▇▇ MI E 10 KNLG/989 Leap Wireless International 4/28/02 To Expire ----
▇▇▇ ▇▇▇▇▇ ▇▇ C2 15 WPOK579 Leap Wireless International 7/22/04 317,873
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ C2 15 WPOK583 Leap Wireless International 7/22/04 202,542
▇▇▇ ▇▇▇▇▇▇ ▇▇ C2 15 WPOK582 Leap Wireless International 7/22/04 145,922
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C2 15 WPOJ702 Leap Wireless International 6/30/04 81,586
395 Salem-Albany-
Corvallis OR C6 5 WPOK599 Leap Wireless International 7/22/04 534,999
279 Marinette -
Menominee WI/MI E 10 KNLG985 Leap Wireless International 4/28/02 To Expire ---- 68,935
69 Casper-
Gillette WY C1 15 WPOK577 Leap Wireless International 7/22/04 146,928
SUBTOTAL 6,454,559 326,254
19B
C. LICENSES TO BE TRANSFERRED TO COLLATERAL POOL PENDING CLOSING OF NTCH TENN
SWAP
COLLATERAL
POOL X=YES
CHANNEL CALL (X)=BEING
BTA MARKET NAME STATE BLOCK MHZ SIGN NAME OF LICENSEE TRANSFERRED
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇ C1 15 WPOJ763 Cricket Licensee(Reauction)Inc. X
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ C5 10 WPSJ980 Cricket Licensee(Reauction)Inc. X
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ C2 15 WPSJ989 Cricket Licensee(Reauction)Inc. X
281 Marion OH C3 10 WPSJ979 Cricket Licensee(Reauction)Inc. X
431 Steubenville OH C3 10 WPSJ981 Cricket Licensee(Reauction)Inc. X
218 Johnstown PA C4 10 WPSJ977 Cricket Licensee(Reauction)Inc. X
265 Lufkin TX C4 10 WPSJ978 Cricket Licensee(Reauction)Inc. X
1ST BUILD- DATE 01GPOPS
BTA MARKET NAME OUT DATE FILED STATUS SELLER (EASI)
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ 6/30/04 5/29/01 Consented Tennessee Swap 119,036
352 Plattsburgh 5/29/06 9/19/01 Consented Tennessee Swap 118,818
463 Watertown 5/29/06 9/19/01 Consented Tennessee Swap 302,829
281 ▇▇▇▇▇▇ 5/29/06 9/19/01 Consented Tennessee Swap 98,241
431 Steubenville 5/29/06 9/19/01 Consented Tennessee Swap 131,331
218 Johnstown 5/29/06 9/19/01 Consented Tennessee Swap 232,154
265 Lufkin 5/29/06 9/19/01 Consented Tennessee Swap 163,341
SUBTOTAL 1,165,750
D. LICENSES TO BE TRANSFERRED TO NTCH PENDING CLOSING OF TENN SWAP AND IDAHO
TRANSACTION
CHANNEL CALL 1ST BUILD-
BTA MARKET NAME STATE BLOCK MHZ SIGN NAME OF LICENSEE OUT DATE
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ C1 15 WPOK586 Leap Wireless International, Inc. 7/22/04
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ C1 15 WPOK605 Leap Wireless International, Inc. 7/22/04
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF463 Chasetel Licensee Corp X 9/17/01
49 Blythevelle AR C1 15 WPOK574 Leap Wireless International, Inc. 7/22/04
53 Bozeman MT C5 10 WPOK576 Leap Wireless International, Inc. 7/22/04
96 Cookeville TN C1 15 KNLF461 Chasetel Licensee Corp X 9/17/01
▇▇▇ ▇▇▇▇▇▇▇▇▇-
▇▇▇▇▇ ▇▇▇▇ ▇▇ C1 15 KNLF462 Chasetel Licensee Corp X 9/17/01
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C1 15 KNLF464 Chasetel Licensee Corp X 9/17/01
▇▇▇ ▇▇▇▇▇▇▇▇▇-
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ C1 15 KNLF465 Chasetel Licensee Corp X 9/17/01
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇-
▇▇▇▇▇▇ ▇▇ C1 15 KNLF468 CHASETEL LICENSEE CORP X 9/17/01
FCC
DATE APPLICATION 01 POPS
BTA MARKET NAME FILED NUMBER ASSIGNEE (EASI)
IAT
Communic-
ations,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ 5/7/01 451246 Inc. 225,322
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ 5/7/01 451246 IAT
Communic-
ations,
Inc. 164,293
146 ▇▇▇▇▇▇▇▇ 5/24/01 467877 NTCH, Inc. 192,297
49 Blythevelle 9/19/01 586962 NTCH, Inc. 71,601
53 Bozeman 9/19/01 586962 NTCH, Inc. 84,818
96 Cookeville 5/24/01 467877 NTCH, Inc. 139,561
▇▇▇ ▇▇▇▇▇▇▇▇▇-
▇▇▇▇▇ ▇▇▇▇ 5/24/01 467877 NTCH, Inc. 120,794
211 ▇▇▇▇▇▇▇ 5/24/01 467877 NTCH, Inc. 289,279
229 Kingsport-
▇▇▇▇▇▇▇▇ City 5/24/01 467877 NTCH, Inc. 711,868
295 Middlesboro-
▇▇▇▇▇▇ 5/24/01 467877 NTCH, Inc. 118,250
SUBTOTAL 2,118,083
E. LICENSES UNDER NEGOTIATION TO BE TRANSFERRED TO THIRD PARTIES
CHANNEL CALL 1ST BUILD-
BTA MARKET NAME STATE BLOCK MHZ SIGN NAME OF LICENSEE OUT DATE 01 POPS (EASI)
366 Pueblo CO C4 10 WPOK596 Leap Wireless International 7/22/04 316,376
395 Salem-
Albany-
Corvallis OR C3 10 WPOK599 Leap Wireless International 7/22/04 534,999
69 Casper-
Gillette WY C2 15 WPOK577 Leap Wireless International 7/22/04 146,928
250 Lewiston-
Moscow ID C1 15 WPOK588 Leap Wireless International 7/22/04 124,661
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ F 10 KNLG741 Cricket Licensee(Lakeland)Inc. X 4/28/02 489,650
▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇ Leap Wireless International 4/28/02 67,132
54 Brainerd MN E 10 KNLG968 Leap Wireless International 4/28/02 98,930
132 Escanaba MI E 10 KNLG972 Leap Wireless International 4/28/02 47,541
371 Redding CA C2 15 WPOK597 Leap Wireless International 7/22/04 278,572
53 Bozeman MT C3, C4 20 WPOK576 Leap Wireless International 7/22/04 84,818
SUBTOTAL 2,189,607
F. LICENSES PLEDGED (OR BEING PLEDGED) TO THIRD PARTIES
CHANNEL CALL 1ST BUILD- DATE THIRD 01 POPS
BTA MARKET NAME STATE BLOCK MHZ SIGN NAME OF LICENSEE OUT DATE FILED STATUS PARTY (EASI)
60 Buffalo NY E 10 WPOJ771 MCG PCS Licensee, Inc. (1) 6/30/04 Consumated MCG 1,212,839
▇▇▇ ▇▇▇▇▇▇▇▇▇-
▇▇▇▇▇-
▇▇▇▇▇▇▇▇ ▇▇ C2 15 WPOK587 Leap Wireless International 7/22/04 2/7/02 Pending NTCH 194,952
482 Yakima WA C2 15 WPOK607 Leap Wireless International 7/22/04 2/7/02 Pending NTCH 258,928
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ C1 15 WPOK606 Leap Wireless International 7/22/04 2/7/02 Pending NTCH 660,794
SUBTOTAL 2,327,513
(1) To be contributed to the collateral pool in the future pursuant to Section
5.19(g) of the Credit Agreement.
19C
EXHIBIT B
Schedule 5.20
Further Investments
PLANNED LICENSE
SUBSIDIARY OWNER MARKET 1/31/2003 4/30/2003 7/31/2003 10/31/2003 2003 TOTAL
------------- ------------- ------------- ------------- --------------
AIRGATE LICENSES
Cricket Licensee
(North Carolina), Inc. Charlotte $242,476.77 $242,476.77 $242,476.77 $242,476.77 $ 969,907.08
Cricket Licensee XIII, Inc. Greensboro 220,786.91 220,786.91 220,786.91 220,786.91 883,147.64
Cricket Licensee XIV, Inc. Hickory 3,475.60 3,475.60 3,475.60 3,475.60 13,902.40
------------- ------------- ------------- ------------- --------------
AIRGATE SUBTOTAL $466,739.28 $466,739.28 $466,739.28 $466,739.28 1,866,957.12
CHASETEL LICENSES
$
Cricket Licensee XV, Inc. Chattanooga $513,150.99 $513,150.99 $513,150.99 $513,150.99 2,052,603.96
Cricket Licensee XVI, Inc. Nashville 1,932,365.65 1,932,365.65 1,932,365.65 1,932,365.65 7,729,462.62
Cricket Licensee XVII, Inc. Memphis 1,681,818.03 1,681,818.03 1,681,818.03 1,681,818.03 6,727,272.14
Cricket Licensee XVIII, Inc. Knoxville 767,036.83 767,036.83 767,036.83 767,036.83 3,068,147.30
Cricket Licensee XIX, Inc. Clarksville 134,274.42 134,274.42 134,274.42 134,274.42 537,097.69
------------- ------------- ------------- ------------- --------------
CHASETEL LICENSEE SUBTOTAL $5,028,645.92 $5,028,645.92 $5,028,645.92 $5,028,645.92 $20,114,583.70
Cricket Licensee XX, Inc. Omaha $ 26,992.46 $ 26,992.46 $ 26,992.46 $ 26,992.46 $ 107,969.84
Cricket (Lakeland), Inc. Lakeland 74,425.70 74,425.70 74,425.70 74,425.70 297,702.80
Cricket Holdings Dayton, Inc. Dayton 43,097.39 43,097.39 43,097.39 43,097.39 172,389.56
Cricket Licensee Denver, Inc. Denver 78,919.39 78,919.39 78,919.39 78,919.39 315,677.56
------------- ------------- ------------- ------------- --------------
TOTAL - ALL LICENSES $5,718,820.14 $5,718,820.14 $5,718,820.14 $5,718,820.14 $22,875,280.58
SEPARATE ACCOUNT OF PARENT $ 2,395,216.30
--------------
Amounts invested by Parent from time to time pursuant to Section 5.20 shall be
allocated pro rata among the investments listed above based upon the debt
service obligations that remain to be paid in 2003 with respect to such
investments.
20
EXHIBIT C
Schedule 6.26
BTAs in Borrower ▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ Chattanooga
2 Middle Tennessee TN Nashville
Clarksville
3 Knoxville TN Knoxville
4 Memphis TN Memphis
5 Triad Area NC Greensboro /Winston-Salem
6 Tulsa OK Tulsa
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇ ▇▇▇▇▇▇▇▇▇ ▇▇ Charlotte
9 Central Arkansas AR Little Rock
Hot Springs
Pine Bluff
10 Wasatch Front UT Salt Lake City/Ogden
Provo
11 Albuquerque NM Albuquerque
▇▇ ▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇ Wichita
14 Pueblo CO ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇ Spokane
16 Fort ▇▇▇▇▇ AR Fort ▇▇▇▇▇
17 Hickory NC Hickory
18 Pittsburgh PA Pittsburgh
▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇ Columbus
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇ Phoenix
23 Denver CO Denver/Boulder
24 Boise ID Boise
25 Dayton OH Dayton /Springfield
26 Omaha NE Omaha
27 Salem OR Salem
28 ▇▇▇▇-▇▇▇▇▇▇ and Carson City NV Reno
29 Toledo OH Toledo
Sandusky
30 Northern Colorado CO Ft. ▇▇▇▇▇▇▇
Greeley
▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇
33 Visalia CA Visalia
34 Eugene OR Eugene
35 Lincoln NE Lincoln
36 Flint MI Flint
37 Battle Creek and Kalamazoo MI Battle Creek
Kalamazoo
38 Jackson MI Jackson
39 Syracuse NY Syracuse
40 Buffalo NY Buffalo
22
EXHIBIT D
Form of Intercompany Agreement
(To be entered into between Parent and individual License Subsidiaries)
23
ADMINISTRATIVE SERVICES AGREEMENT
by and between
LEAP WIRELESS INTERNATIONAL, INC.
and
((COMPANY))
24
TABLE OF CONTENTS
PAGE
ARTICLE 1 SERVICES..............................................................1
1.1 Services.................................................................1
1.2 Term.....................................................................2
1.3 Charges and Payment......................................................2
1.4 General Obligations; Standard of Care....................................3
1.5 Certain Limitations......................................................4
1.6 Confidentiality..........................................................5
1.7 Termination..............................................................5
1.8 Disclaimer of Warranties, Limitation of Liability And Indemnification....5
ARTICLE 2 MISCELLANEOUS.........................................................6
2.1 Taxes....................................................................6
2.2 Relationship of Parties..................................................6
2.3 Modification And Amendment...............................................6
25
ADMINISTRATIVE SERVICES AGREEMENT
THIS ADMINISTRATIVE SERVICES AGREEMENT ("Agreement"), dated as of
____________ (the "Effective Date"), is by and between LEAP WIRELESS
INTERNATIONAL, INC., a Delaware corporation ("Leap"), and {{COMPANY}}, a
Delaware corporation (the "Company").
WHEREAS, the Company is a wholly-owned subsidiary of Leap; and
WHEREAS, the Company desires to enter into this Agreement with Leap for
the provision of administrative services to the Company on the terms set forth
herein.
NOW, THEREFORE, in consideration of the above premises and for other
good and valid consideration, the receipt and adequacy of which are hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
ARTICLE 1
SERVICES
1.1 SERVICES.
(a) ADMINISTRATIVE SERVICES. Except as otherwise provided herein, for
the term determined pursuant to Section 1.2 hereof, Leap shall provide, or cause
to be provided, to the Company the following "Initial Services:"
(i) Human resources and personnel services, including
recruiting and hiring of new employees and administration of payroll, employee
benefits and stock option issuance and tracking ("HR Services");
(ii) Media relations, public affairs and advertising services
("Media Services");
(iii) Accounting, tax (including preparation and filing of all
federal and state income and franchise tax returns, as applicable), billing,
legal and other corporate support services ("Corporate Support Services");
(iv) Facilities rental, maintenance and related services,
including supply of telephone and utility services, in San Diego ("Facilities
Services"); and
(v) Payment of all federal and state unitary income taxes
("Income Tax Payments") owing from the Company.
(b) ADDITIONAL SERVICES. From time to time after the date of this
Agreement, the parties may identify and agree upon additional services that Leap
will provide the Company in accordance with the terms of this Agreement (the
"Additional Services" and, together with the Initial Services, the "Services");
provided, however, Leap shall have no obligation hereunder to
26
provide any Additional Services unless it expressly so agrees. To the extent the
parties agree, the parties shall create an amendment to this Agreement, setting
forth a description of the Additional Service(s), the time period during which
the Additional Service(s) will be provided, the charge, if any, for the
Additional Service(s) and any other terms applicable thereto.
(c) SERVICES PERFORMED BY OTHERS. At its option, Leap may
cause any Service it is required to provide hereunder to be provided by any
other person or entity that is providing, or may from time to time provide, the
same or similar services for Leap.
1.2 TERM. The term of this Agreement shall commence on the Effective
Date and shall remain in effect until the first anniversary of the Effective
Date and thereupon (and upon each anniversary thereafter)(the "Renewal Date")
shall automatically renew for an additional one year period, unless (i) earlier
terminated under Section 1.7 hereof or (ii) terminated by either party upon the
Renewal Date, provided that such party has given written notice to the other
party no less than six months prior to the Renewal Date, with a copy to the
agent under the Credit Agreement and to the agent under each other credit
agreement constituting a Secured Instrument (in either event, the "Termination
Date"). The terms "Credit Agreement" and "Secured Instrument" are used in
Sections 1.2 and 1.7 as such terms are defined in the Collateral Agency and
Intercreditor Agreement, dated as of November 24, 1999, among Cricket
Communications, Inc., State Street Bank and Trust Company, and the other parties
thereto, as amended from time to time.
1.3 CHARGES AND PAYMENT.
(a) CHARGES FOR INITIAL SERVICES. Leap shall allocate and ▇▇▇▇
the Company for all reasonable charges stemming from the provision of (i) the HR
Services, the Media Services, the Corporate Support Services, and the Facilities
Services annually for a fixed fee of Twenty Five Thousand Dollars ($25,000.00)
per year; and (ii) the Income Tax Payments in accordance with the provisions of
Regulation Section 1.1502-33(d)(3) promulgated by the United States Treasury
Department in conjunction with the method under Regulation Section
1.1552-1(a)(1) (The percentage to be used under Regulation Section 1.1502(d)(1)
is 100%), all as adjusted from time to time in accordance with the process and
procedures established under subsection 1.3(d) hereof. Wherever practical,
charges shall be levied only to the extent necessary to reimburse Leap for the
costs of performing the Services, and shall be based on actual incurred costs,
not budgeted or estimated costs.
(b) CHARGES FOR ADDITIONAL SERVICES. The Company shall pay
Leap the charges, if any, set forth in the applicable amendment to this
Agreement for the provision of each of the Additional Services listed therein,
which charges shall be determined consistent with subsection 1.3(a) above.
(c) PAYMENT TERMS. Leap shall ▇▇▇▇ the Company pro-rata on a
monthly basis for all charges pursuant to this Agreement. Such bills shall be
accompanied by reasonable documentation or other reasonable explanation
supporting such charges. The Company shall pay Leap for all Services provided
hereunder within thirty (30) days after receipt of an invoice therefor. Late
payments shall bear interest at the rate of 10% per annum, compounded annually.
27
(d) ERROR CORRECTION; TRUE-UPS; ACCOUNTING. The parties shall
agree on a process and procedure for conducting internal audits and making
adjustments to charges as a result of the movement of employees and functions
between parties, the discovery of errors or omissions in charges, as well as a
true-up of amounts owed. In no event shall such processes and procedures extend
beyond one (1) year after completion of a Service.
(e) PRICING ADJUSTMENTS. In the event of a tax audit
adjustment relating to the pricing of any or all Services provided pursuant to
this Agreement in which it is determined by a taxing authority that any of the
charges, individually or in combination, did not result in an arm's-length
payment, then the parties may agree to make corresponding adjustments to the
charges in question for such period to the extent necessary to achieve
arm's-length pricing. Any adjustment made pursuant to this subsection 1.3(e)
shall be reflected in the parties' official books and records, and the resulting
overpayment or underpayment shall create an obligation to be paid by either Leap
or the Company, as applicable, on the same payment terms as specified in
subsection 1.3(c) above.
(f) REIMBURSEMENT OF OTHER COSTS AND EXPENSES. From time
to time, Leap may, with the approval of the Company, incur costs and expenses on
a reasonable basis on behalf of the Company unrelated to the provision of the
Services and shall invoice the Company separately for such costs and expenses.
The Company shall promptly, and in no event later than thirty (30) days
following receipt of such invoice, remit payment therefore to Leap.
1.4 GENERAL OBLIGATIONS; STANDARD OF CARE.
(a) PERFORMANCE REQUIREMENTS: LEAP. Subject to subsection
1.5(b), Leap shall maintain sufficient resources to perform its obligations
hereunder. Leap shall exercise the same care and skill as it exercises in
performing similar services for itself.
(b) PERFORMANCE REQUIREMENTS: THE COMPANY. The Company shall,
in connection with receiving Services, provide information and documentation,
sufficient resources and timely decisions, approvals and acceptances in order
that Leap may accomplish its obligations hereunder in a timely manner.
(c) NATURE OF SERVICES; CHANGES. The parties acknowledge the
nature of the Services and that Leap may make changes from time to time in the
manner of performing the Services (e.g., if Leap is making similar changes in
performing similar services for itself and its affiliates).
(d) RESPONSIBILITY FOR ERRORS; DELAYS. Leap's sole
responsibility to the Company:
(i) for errors or omissions in connection with Services
shall be to furnish correct information, payment and/or adjustment in the
Services, at no additional cost or expense to the Company; provided, the Company
must promptly advise Leap of any such error or omission of which it becomes
aware; and
(ii) for failure to adequately deliver any Service
because of Impracticability, shall be to use reasonable efforts, subject to
subsection 1.5(b), to make the
28
Services available and/or to resume performing the Services as promptly as
reasonably practicable.
(e) GOOD FAITH COOPERATION; CONSENTS. The parties will use
good faith efforts to cooperate with each other in all matters relating to the
provision and receipt of Services. Such cooperation shall include exchanging
information, providing electronic access to systems used in connection with
Services, performing true-ups and adjustments and obtaining all consents,
licenses, sublicenses or approvals necessary to permit each party to perform its
obligations hereunder. The costs of obtaining such consents, licenses,
sublicenses or approvals shall be allocated in accordance with Section 1.3(a).
The parties will maintain supporting documentation and cooperate with each other
in making such information available as needed in the event of a tax audit.
(f) ALTERNATIVES. If Leap reasonably believes it is unable to
provide any Service because of Impracticability, the parties shall cooperate to
determine the best alternative approach. Until such alternative approach is
found or the problem otherwise resolved to the satisfaction of the parties, Leap
shall use reasonable efforts, subject to Section 1.5(a) and Section 1.5(b), to
continue providing the Service. To the extent an agreed upon alternative
approach requires payment above and beyond that which is included in Leap's
charge for the Service in question, the Company shall make any such additional
payment unless the parties otherwise agree in writing.
1.5 CERTAIN LIMITATIONS.
(a) IMPRACTICABILITY. Leap shall not be required to provide
any Service to the extent the performance of such Service becomes
"Impracticable" as a result of a cause or causes outside the reasonable control
of Leap, or to the extent the performance of such Services would require Leap to
violate any applicable laws, rules or regulations, or would result in the breach
of any software license or other applicable contract.
(b) ADDITIONAL RESOURCES. In providing the Services, Leap
shall not be obligated to: (i) hire any additional employees; (ii) maintain the
employment of any specific employee; (iii) purchase, lease or license any
additional equipment or software; or (iv) pay any costs related to the transfer
or conversion of the Company's data to the Company or any alternate supplier of
Services.
(c) NO SALE, TRANSFER, ASSIGNMENT. The Company may not sell,
transfer, assign or otherwise use the Services provided hereunder, in whole or
in part, for the benefit of any person or entity other than the Company.
1.6 CONFIDENTIALITY.
(a) INFORMATION SUBJECT TO OTHER OBLIGATIONS. The Company
agrees that all confidential information regarding the Services, including, but
not limited to, price, costs, methods of operation, and software, shall be
maintained in confidence.
(b) INTERNAL USE; TITLE, COPIES, RETURN. The Company agrees
that:
29
(i) all systems, procedures and related materials
provided to the Company are for the Company's internal use only and only as
related to the Services;
(ii) title to all systems used in performing the
Services provided hereunder shall remain in Leap or its third party vendors;
(iii) The Company shall not copy, modify, reverse
engineer, decompile or in any way alter systems without Leap's express written
consent;
(iv) Upon the termination of any of the Services, the
Company shall return to Leap, as soon as practicable, any equipment or other
property of Leap relating to the Services which is owned or leased by Leap and
is or was in the Company's possession or control.
1.7 TERMINATION.
(a) ELECTION TO TERMINATE. Either party may terminate this
Agreement with respect to some or all of the Services by giving at least six
months advance written notice of such termination to the other party, with a
copy to the agent under the Credit Agreement and to the agent under each other
credit agreement constituting a Secured Instrument.
(b) AUTOMATIC TERMINATION. Except to the extent the parties
otherwise agree in writing, this Agreement will automatically terminate on the
Termination Date.
(c) TERMINATION OF LESS THAN ALL SERVICES. In the event of any
termination with respect to one or more, but less than all, Services, this
Agreement shall continue in full force and effect with respect to any Services
not terminated hereby.
1.8 DISCLAIMER OF WARRANTIES, LIMITATION OF LIABILITY AND
INDEMNIFICATION.
(a) DISCLAIMER OF WARRANTIES. LEAP DISCLAIMS ALL WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE
SERVICES. LEAP MAKES NO REPRESENTATIONS OR WARRANTIES AS TO THE QUALITY,
SUITABILITY OR ADEQUACY OF THE SERVICES FOR ANY PURPOSE OR USE.
(b) LIMITATION OF LIABILITY; INDEMNIFICATION OF THE COMPANY.
Leap shall have no liability to the Company with respect to its furnishing any
of the Services hereunder except for liabilities arising out of its gross
negligence or willful misconduct occurring after the date hereof. Leap will
indemnify, defend and hold harmless the Company in respect of all liabilities
related to, arising from, asserted against or associated with such gross
negligence or willful misconduct. In no event shall Leap or any of its agents or
affiliates have any liability for any incidental, indirect, special or
consequential damages, whether or not caused by or resulting from negligence or
breach of obligations hereunder and whether or not informed of the possibility
of the existence of such damages.
30
(c) LIMITATION OF LIABILITY; INDEMNIFICATION OF LEAP. The
Company shall indemnify and hold harmless Leap in respect of all liabilities
related to, arising from, asserted against or associated with Leap's furnishing
or failing to furnish the Services provided for in this Agreement, other than
liabilities arising out of the willful misconduct following the date hereof. In
no event shall Leap have any liability for any incidental, indirect, special or
consequential damages, whether or not caused by or resulting from negligence or
breach of obligations hereunder and whether or not informed of the possibility
of the existence of such damages.
ARTICLE 2
MISCELLANEOUS
2.1 TAXES. The Company shall bear all taxes, duties and other similar
charges (and any related interest and penalties) imposed as a result of the
Company's receipt of Services under this Agreement, including any tax which the
Company is required to withhold or deduct from payments to Leap, except any net
income tax imposed upon Leap.
2.2 RELATIONSHIP OF PARTIES. Nothing in this Agreement shall be deemed
or construed by the parties or any third party as creating the relationship of
principal and agent, partnership or joint venture between the parties, it being
understood and agreed that no provision contained herein, and no act of the
parties, shall be deemed to create any relationship between the parties other
than the relationship of independent contractor nor be deemed to vest any
rights, interest or claims in any third parties.
2.3 MODIFICATION AND AMENDMENT. This Agreement may not be modified or
amended except in a writing signed by the parties.
IN WITNESS WHEREOF, the parties have executed this Interim Services
Agreement as of the date first above written.
LEAP WIRELESS INTERNATIONAL, INC.:
By:
---------------------------------------
Name:
Title:
{{COMPANY}}:
By:
---------------------------------------
Name:
Title:
31
EXHIBIT E
March 2002 Equity Investments in License Subsidiaries
CONTRIBUTION/REMAINING 2002
LICENSE SUBSIDIARY DEBT SERVICE OBLIGATION
Cricket Licensee (North Carolina), Inc. $ 951,692.82
Cricket Licensee XIII, Inc. 441,573.82
Cricket Licensee XIV, Inc. 6,951.20
Chasetel Licensee Corp. 1,232,118.87
Cricket Licensee XV, Inc. 251,464.52
Cricket Licensee XVI, Inc. 946,936.50
Cricket Licensee XVII, Inc. 824,158.14
Cricket Licensee XVIII, Inc. 375,878.74
Cricket Licensee XIX, Inc. 65,799.84
Cricket Licensee (Reauction), Inc. 26,992.46
Cricket Licensee XX, Inc. 53,984.92
Cricket Licensee (Lakeland), Inc. 223,277.10
Cricket Holdings Dayton, Inc. 129,292.17
Cricket Licensee (Denver), Inc. 236,758.17
TOTAL $ 5,766,879.27