EXHIBIT 10.6
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WORKING CAPITAL CREDIT AGREEMENT
dated as of
September 17, 1998
among
ADVANCED RADIO TELECOM CORP.,
The Lenders Party Hereto,
and
LUCENT TECHNOLOGIES INC.,
as Administrative Agent
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[Reference No. 7725-029]
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions
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SECTION 1.01. Defined Terms............................................ 1
SECTION 1.02. Classification of Loans and
Borrowings........................................... 20
SECTION 1.03. Terms Generally.......................................... 20
SECTION 1.04. Accounting Terms; GAAP................................... 21
ARTICLE II
The Loans
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SECTION 2.01. Commitments.............................................. 21
SECTION 2.02. Loans and Borrowings..................................... 21
SECTION 2.03. Requests for Borrowings.................................. 22
SECTION 2.04. Funding of Borrowings.................................... 23
SECTION 2.05. Interest Elections....................................... 24
SECTION 2.06. Termination and Reduction of Commitments................. 26
SECTION 2.07. Repayment of Loans; Evidence of Debt..................... 26
SECTION 2.08. Prepayment of Loans...................................... 27
SECTION 2.09. Interest; Warrants....................................... 28
SECTION 2.10. Alternate Rate of Interest............................... 30
SECTION 2.11. Increased Costs.......................................... 30
SECTION 2.12. Break Funding Payments................................... 32
SECTION 2.13. Taxes.................................................... 32
SECTION 2.14. Payments Generally; Pro Rata Treatment; Sharing of
Set-Offs............................................. 33
SECTION 2.15. Mitigation Obligations; Replacement
of Lenders........................................... 35
SECTION 2.16. Extension of Maturity Date............................... 36
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ARTICLE III
Representations and Warranties
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SECTION 3.01. Organization; Powers..................................... 37
SECTION 3.02. Authorization; Enforceability............................ 37
SECTION 3.03. Governmental Approvals; No Conflicts..................... 37
SECTION 3.04. Financial Condition; No Material
Adverse Change...................................... 38
SECTION 3.05. Properties and Licenses.................................. 38
SECTION 3.06. Litigation and Environmental Matters..................... 39
SECTION 3.07. Compliance with Laws and Agreements...................... 39
SECTION 3.08. Investment and Holding Company Status.................... 40
SECTION 3.09. Taxes.................................................... 40
SECTION 3.10. ERISA.................................................... 40
SECTION 3.11. Disclosure............................................... 40
SECTION 3.12. Subsidiaries............................................. 40
SECTION 3.13. Insurance................................................ 41
SECTION 3.14. Labor Matters............................................ 41
SECTION 3.15. Purchase Agreement....................................... 41
ARTICLE IV
Conditions
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SECTION 4.01. Effective Date........................................... 41
SECTION 4.02. Each Borrowing........................................... 44
ARTICLE V
Affirmative Covenants
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SECTION 5.01. Financial Statements and Other Information 45
SECTION 5.02. Notices of Material Events................................ 47
SECTION 5.03. Existence; Conduct of Business........................... 47
SECTION 5.04. Payment of Obligations................................... 47
SECTION 5.05. Maintenance of Properties................................ 48
SECTION 5.06. Insurance................................................ 48
SECTION 5.07. Books and Records; Inspection Rights..................... 48
SECTION 5.08. Compliance with Laws and Agreements...................... 48
SECTION 5.09. Use of Proceeds.......................................... 49
SECTION 5.10 FCC Licenses............................................. 49
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ARTICLE VI
Negative Covenants
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SECTION 6.01. Indebtedness............................................... 49
SECTION 6.02. Liens...................................................... 50
SECTION 6.03. Fundamental Changes........................................ 52
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions;
Asset Sales.............................................. 53
SECTION 6.05. Hedging Agreements......................................... 55
SECTION 6.06. Restricted Payments........................................ 55
SECTION 6.07. Transactions with Affiliates............................... 56
SECTION 6.08. Restrictive Agreements..................................... 56
SECTION 6.09. Repayment of Indebtedness.................................. 56
SECTION 6.10. Intercompany Agreements.................................... 57
SECTION 6.11. Limitation on Sale-Leaseback Transactions.................. 57
SECTION 6.12. Restricted Subsidiaries.................................... 57
SECTION 6.13. FCC Licenses and License Subsidiaries...................... 58
SECTION 6.14. ERISA...................................................... 58
SECTION 6.15. Minimum Revenues........................................... 59
SECTION 6.16. Minimum Customers.......................................... 59
ARTICLE VII
Events of Default
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Events of Default.............................................................. 60
ARTICLE VIII
The Administrative Agent
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The Administrative Agent....................................................... 63
ARTICLE IX
Miscellaneous
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SECTION 9.01. Notices.................................................... 65
SECTION 9.02. Waivers; Amendments........................................ 66
SECTION 9.03. Expenses; Indemnity; Damage Waiver......................... 67
SECTION 9.04. Successors and Assigns..................................... 69
SECTION 9.05. Survival................................................... 70
SECTION 9.06. Counterparts; Integration; Effectiveness................. 71
SECTION 9.07. Severability............................................. 71
SECTION 9.08. Right of Setoff.......................................... 71
SECTION 9.09. Governing Law; Jurisdiction; Consent
to Service of Process................................. 71
SECTION 9.10. WAIVER OF JURY TRIAL..................................... 72
SECTION 9.11. Headings................................................. 73
SECTION 9.12. Confidentiality.......................................... 73
SECTION 9.13. Interest Rate Limitation................................. 76
SCHEDULES:
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Schedule 2.01 -- Commitments
Schedule 3.05 -- Licenses
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.04 -- Permitted Asset Sales
Schedule 6.08 -- Existing Restrictions
EXHIBITS:
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Exhibit A-1 -- Form of Opinion of Ropes & ▇▇▇▇
Exhibit A-2 -- Form of Opinion of Wiley, Rein & Fielding
Exhibit A-3 -- Form of Opinion of Cravath, Swaine & ▇▇▇▇▇
Exhibit B -- Form of Fair Market Warrant
Exhibit C -- Form of ▇▇▇▇▇ Warrant
WORKING CAPITAL CREDIT AGREEMENT dated as of September 17,
1998, among ADVANCED RADIO TELECOM CORP., a Delaware corporation,
the LENDERS party hereto and LUCENT TECHNOLOGIES INC., as
Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
Definitions
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SECTION 1.01. Defined Terms. As used in this Agreement, the
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following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
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whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Adjusted Consolidated Net Tangible Assets" means the total amount of
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assets of the Borrower and its Restricted Subsidiaries (less applicable
depreciation, amortization and other valuation reserves), except to the extent
resulting from write-ups of capital assets (excluding write-ups in connection
with accounting for acquisitions in accordance with GAAP), after deducting
therefrom (a) all current liabilities of the Borrower and its Restricted
Subsidiaries (excluding intercompany items) and (b) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangibles (other than FCC Licenses), all as set forth on the quarterly or
annual consolidated balance sheet of the Borrower and its Restricted
Subsidiaries, prepared in accordance with GAAP and most recently delivered to
the Lenders pursuant to Section 5.01(a) or (b); provided that the value of any
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FCC Licenses shall, in the event of an auction for similar licenses, be equal to
the fair market value ascribed thereto in good faith by the Board of Directors
of the Borrower and evidenced by a resolution of such board.
"Adjusted LIBO Rate" means, with respect to any LIBOR Borrowing for
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any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means Lucent, in its capacity as administrative
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agent for the Lenders hereunder.
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"Affiliate" means, with respect to a specified Person, another Person
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that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum equal to
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the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Assignment and Acceptance" means an assignment and acceptance entered
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into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in a form
approved by the Administrative Agent.
"Availability Period" means the period from and including the
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Effective Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"Board" means the Board of Governors of the Federal Reserve System of
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the United States of America.
"Borrower" means Advanced Radio Telecom Corp., a Delaware corporation.
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"Borrowing" means a Loan or group of Loans of the same Type, made,
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converted or continued on the same date and, in the case of LIBOR Loans, as to
which a single Interest Period is in effect.
"Borrowing Request" means a request by the Borrower for a Borrowing in
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accordance with Section 2.03.
"Bridge Note" means the promissory note dated June 10, 1998, issued by
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the Borrower to Lucent.
"Business Day" means any day that is not a Saturday, Sunday or other
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day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a LIBOR Loan, the
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term "Business Day" shall also exclude any day on which banks are not open for
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dealings in dollar deposits in the London interbank market.
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"Business Plan" means, for any fiscal year, the business plan of the
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Borrower and the Restricted Subsidiaries for such fiscal year.
"Capital Lease Obligations" of any Person means the obligations of
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such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Change in Control" means (a) the acquisition of ownership, directly
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or indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof), of shares
representing more than 35% of the aggregate ordinary voting power represented by
the issued and outstanding capital stock of the Borrower; or (b) occupation of a
majority of the seats (other than vacant seats) on the Board of Directors of the
Borrower by Persons who were neither (i) nominated by the Board of Directors of
the Borrower nor (ii) appointed by directors so nominated.
"Change in Law" means (a) the adoption of any law, rule or regulation
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after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender (or, for
purposes of Section 2.11(b), by any lending office of such Lender or by such
Lender's holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended from time
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to time.
"Commitment" means, with respect to each Lender, the commitment, if
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any, of such Lender to make Loans hereunder during the Availability Period,
expressed as an amount representing the maximum principal amount of the Loans to
be made by such Lender hereunder, as such commitment may be (a) reduced from
time to time pursuant to Section 2.06 and (b) reduced or increased from time to
time pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Lender's Commitment is set forth on Schedule 2.01, or in
the
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Assignment and Acceptance pursuant to which such Lender shall have assumed
its Commitment, as applicable. The initial aggregate amount of the Lenders'
Commitments is $25,000,000.
"Control" means the possession, directly or indirectly, of the power
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to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
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"Credit Exposure" means, with respect to any Lender at any time, the
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sum of the outstanding principal amount of such Lender's Loans at such time.
"Default" means any event or condition which constitutes an Event of
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Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosed Matters" means the actions, suits and proceedings and the
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environmental matters disclosed in Schedule 3.06.
"Disqualified Stock" means any capital stock of the Borrower which by
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its terms (or by the terms of any security into which it is convertible or for
which it is exchangeable or exercisable) or upon the happening of any event (i)
matures or is mandatorily redeemable pursuant to a sinking fund obligation or
otherwise, (ii) is convertible or exchangeable for Indebtedness or Disqualified
Stock, (iii) requires the payment of dividends other than dividends payable
solely in additional shares of capital stock of the Borrower (other than
Disqualified Stock) or (iv) is redeemable or subject to required repurchase at
the option of the holder thereof, in whole or in part, in each case on or prior
to the second anniversary of the latest Maturity Date (as defined in the
Purchase Money Credit Agreement).
"dollars" or "$" refers to lawful money of the United States of
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America.
"Effective Date" means the date on which the conditions specified in
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Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"Environmental Laws" means all laws, rules, regulations, codes,
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ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
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relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
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(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
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amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
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incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section
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4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
6
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Event of Default" has the meaning assigned to such term in Article
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VII.
"Excluded Taxes" means, with respect to the Administrative Agent, any
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Lender or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the United States of America or any similar tax imposed by any other
jurisdiction in which the Borrower is located and (c) in the case of a Foreign
Lender (other than an assignee pursuant to a request by the Borrower under
Section 2.15(b)), any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
(or designates a new lending office) or is attributable to such Foreign Lender's
failure to comply with Section 2.13(e), except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a
new lending office (or assignment), to receive additional amounts from the
Borrower with respect to such withholding tax pursuant to Section 2.13(a).
"Fair Market Warrant" means a warrant to purchase shares of common
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stock of the Borrower, substantially in the form of Exhibit B. The initial
Exercise Price of each Fair Market Warrant on the date of issuance thereof shall
be $3.33 per share, subject to adjustment as provided in Section 2.09(g).
"FCC" means the Federal Communications Commission.
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"FCC License" means any license granted by the FCC to the Borrower or
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any Restricted Subsidiary.
"Federal Funds Effective Rate" means, for any day, the weighted
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average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day
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that is a Business Day, the average (rounded upwards, if necessary, to the next
1/100 of 1%) of the quotations for such day for such transactions received by
the Administrative Agent from three Federal funds brokers of recognized standing
selected by it.
"Financial Officer" means the chief financial officer, principal
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accounting officer, treasurer or controller of the Borrower.
"Foreign Lender" means any Lender that is organized under the laws of
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a jurisdiction other than the United States of America, any State thereof or the
District of Columbia.
"Full Availability Date" means September 30, 1998.
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"GAAP" means, subject to Section 1.04(b), generally accepted
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accounting principles in the United States of America.
"Governmental Authority" means the government of the United States of
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America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any
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obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
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indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not include
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endorsements for collection or deposit in the ordinary course of business.
8
"Hazardous Materials" means all explosive or radioactive substances
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or wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
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foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"Indebtedness" of any Person means, without duplication, (a) all
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obligations of such Person for borrowed money or with respect to advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, (c) all obligations of such Person under conditional
sale or other title retention agreements relating to property acquired by such
Person, (d) all obligations of such Person in respect of the deferred purchase
price of property or services (excluding current accounts payable incurred in
the ordinary course of business), (e) all Indebtedness of others secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property owned or acquired by such
Person, whether or not the Indebtedness secured thereby has been assumed, (f)
all Guarantees by such Person of Indebtedness of others, (g) all Capital Lease
Obligations of such Person, (h) all obligations, contingent or otherwise, of
such Person as an account party in respect of letters of credit and letters of
guaranty and (i) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances. The Indebtedness of any Person shall include
the Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent such Person is liable therefor as a
result of such Person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide that such
Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
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"Initial Loan Limit" means $10,000,000.
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"Intercompany Agreements" has the meaning set forth in paragraph (i)
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of Section 4.01.
9
"Interest Election Request" means a request by the Borrower to convert
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or continue a Borrowing in accordance with Section 2.05.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
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last day of each March, June, September and December and (b) with respect to any
LIBOR Loan, the last day of the Interest Period applicable to the Borrowing of
which such Loan is a part and, in the case of a LIBOR Borrowing with an Interest
Period of more than three months' duration, each day prior to the last day of
such Interest Period that occurs at intervals of three months' duration after
the first day of such Interest Period.
"Interest Period" means, with respect to any LIBOR Borrowing, the
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period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
thereafter, as the Borrower may elect; provided, that (a) if any Interest Period
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would end on a day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless such next succeeding
Business Day would fall in the next calendar month, in which case such Interest
Period shall end on the next preceding Business Day and (b) any Interest Period
that commences on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the last calendar month of
such Interest Period) shall end on the last Business Day of the last calendar
month of such Interest Period. For purposes hereof, the date of a Borrowing
initially shall be the date on which such Borrowing is made and thereafter shall
be the effective date of the most recent conversion or continuation of such
Borrowing.
"Lenders" means the Persons listed on Schedule 2.01 and any other
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Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person (a) that ceases to be a party hereto
pursuant to an Assignment and Acceptance or (b) whose Commitments have
terminated and whose Loans, and all interest thereon, have been repaid.
"LIBOR", when used in reference to any Loan or Borrowing, refers to
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whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.
"LIBO Rate" means, with respect to any LIBOR Borrowing for any
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Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or
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substitute page of such Service, or any successor to or substitute for such
Service, providing rate quotations comparable to those currently provided
on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the "LIBO Rate" with respect to such LIBOR Borrowing for
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such Interest Period shall be the rate at which dollar deposits of $5,000,000
and for a maturity comparable to such Interest Period are offered by the
principal London office of the Administrative Agent (or, if the Administrative
Agent at the time is not a commercial bank, any commercial bank based in New
York City selected by the Administrative Agent for the purpose of quoting such
rate, provided that such commercial bank has a combined capital and surplus and
undivided profits of not less than $500,000,000) in immediately available funds
in the London interbank market at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period.
"License Subsidiary" has the meaning assigned to such term in Section
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6.13.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
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trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan Documents" means this Agreement, the Warrants and the
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Registration Rights Agreement.
"Loan Parties" means the Borrower and the Restricted Subsidiaries.
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"Loans" means loans made by the Lenders pursuant to Section 2.01 of
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this Agreement.
"Lucent" means Lucent Technologies Inc.
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"Material Adverse Effect" means a material adverse effect on (a) the
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business, condition (financial or otherwise), operations, performance or
properties of the Borrower and the Restricted Subsidiaries taken as a whole, (b)
the ability of the Borrower to perform any of its material obligations under any
Loan Document or (c) the rights of or benefits available to the Lenders under
any Loan Document.
"Material Indebtedness" means Indebtedness (other than the Loans), or
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obligations in respect of one or more Hedging Agreements, of any one or more of
the Loan Parties in an aggregate principal amount exceeding $10,000,000. For
purposes of determining Material Indebtedness, the "principal amount" of the
obligations of a Loan Party in respect of any Hedging Agreement at any time
shall be the maximum aggregate amount (giving effect to any netting agreements)
that such Loan Party would be required to pay if such Hedging Agreement were
terminated at such time.
"Maturity Date" means June 30, 1999, subject to extension pursuant to
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Section 2.16.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
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"Multiemployer Plan" means a multiemployer plan as defined in Section
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4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any Prepayment Event (a) the
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cash proceeds received in respect of such event including any cash received in
respect of any non-cash proceeds, but only as and when received, net of (b) the
sum of (i) all fees and out-of-pocket expenses paid by the Borrower and the
Restricted Subsidiaries to third parties in connection with such event and (ii)
the amount of all taxes paid (or reasonably estimated to be payable) by the
Borrower and the Restricted Subsidiaries, and the amount of any reserves
established by the Borrower and the Restricted Subsidiaries to fund contingent
liabilities reasonably estimated to be payable, in each case during the year
that such event occurred or the next succeeding year and that are directly
attributable to such event (as determined reasonably and in good faith by the
chief financial officer of the Borrower).
"Net Working Capital" means, at any date, (a) the consolidated current
-------------------
assets of the Borrower and its Restricted Subsidiaries as of such date
(excluding cash and Permitted Investments) minus (b) the consolidated current
liabilities of the Borrower and its Restricted Subsidiaries as of such date
(excluding current liabilities in respect of
12
Indebtedness), determined on a consolidated basis in accordance with GAAP. Net
Working Capital at any date may be a positive or negative number. Net Working
Capital increases when it becomes more positive or less negative and decreases
when it becomes less positive or more negative.
"Network" means (a) the nationwide, wireless, broadband data network
-------
contemplated to be purchased by the Borrower from Lucent pursuant to the
Purchase Agreement or (b) the portion thereof theretofore purchased by the
Borrower, as the context requires.
"Non-Recourse Debt" means Indebtedness (a) as to which neither the
-----------------
Borrower nor any of the Restricted Subsidiaries (i) provides credit support of
any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness) or (ii) is directly or indirectly liable (pursuant to a
Guarantee or otherwise); (b) no default with respect to which (including any
rights that the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any
holder of any other Indebtedness (other than the Loans) of the Borrower or any
of the Restricted Subsidiaries to declare a default on such other Indebtedness
or cause the payment thereof to be accelerated or payable prior to its stated
maturity; and (c) as to which the lender or lenders of any indebtedness for
borrowed money in an aggregate amount in excess of $5,000,000 has been notified
in writing that such lender shall not have any recourse to the stock or assets
of the Borrower or any of the Restricted Subsidiaries.
"Other Debt" means (a) Indebtedness in respect of debt securities
----------
issued by the Borrower pursuant to a public offering registered with the
Securities and Exchange Commission or pursuant to a private placement made in
accordance with Rule 144A under the Securities Act of 1933 and in any event (i)
which are unsecured, (ii) which mature after the latest Maturity Date (as
defined in the Purchase Money Credit Agreement as in effect at the time of
issuance of such Indebtedness) established in respect of any loans provided for
in the Purchase Money Credit Agreement, (iii) which do not require any scheduled
repayments of principal prior to maturity, (iv) which are not Guaranteed by any
Subsidiary and (v) the other terms and conditions of which are customary market
terms for debt securities issued by companies of comparable credit quality in
the same market and (b) Indebtedness in respect of debt securities issued by the
Borrower pursuant to a private placement to institutional investors made in
reliance on Section 4(2) of the Securities Act of 1933, satisfying the
conditions set
13
forth in clauses (a)(i) through (a)(iv) above and having other terms and
conditions which are reasonably satisfactory to the Required Lenders.
"Other Taxes" means any and all present or future stamp or documentary
-----------
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
----
defined in ERISA and any successor entity performing similar functions.
"▇▇▇▇▇ Warrant" means a warrant to purchase common stock of the
-------------
Borrower, substantially in the form of Exhibit C.
"Permitted Acquisition" means any acquisition of all or substantially
---------------------
all the assets of, or shares or other equity interests in, a Person or division
or line of business of a Person if, immediately after giving effect thereto, (a)
no Default has occurred and is continuing or would result therefrom, (b) all
transactions related thereto are consummated in accordance with applicable laws,
(c) in the case of an acquisition of shares or other equity interests in a
Person, such acquisition results in such Person being merged with and into the
Borrower or a wholly owned Restricted Subsidiary or becoming a wholly owned
Restricted Subsidiary of the Borrower, (d) the consideration for such
acquisition shall consist solely of common stock or Permitted Preferred Stock of
the Borrower, cash, Indebtedness of the Borrower or a Restricted Subsidiary, or
a combination of the foregoing, (e) after giving effect to such acquisition, the
aggregate amount of cash consideration paid in connection with all acquisitions
constituting "Permitted Acquisitions", plus the aggregate principal amount of
all Indebtedness issued as consideration in connection therewith and all
Indebtedness incurred, assumed or otherwise resulting from such acquisitions,
shall not exceed the sum of (i) $20,000,000 and (ii) the aggregate Net Proceeds
received by the Borrower from contributions of equity capital subsequent to the
date hereof, and (f) the Borrower has delivered to the Administrative Agent an
officer's certificate to the effect set forth in clauses (a) through (e) above,
together with all relevant financial information for the business or entity
being acquired.
"Permitted Assignment" means any assignment to Lucent or any Affiliate
--------------------
of Lucent.
14
"Permitted Encumbrances" means:
----------------------
(a) Liens imposed by law for taxes, fees, assessments or other
governmental charges that are not yet due or are being contested in
compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more
than 60 days or are being contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds
and other obligations of a like nature, in each case in the ordinary course
of business;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (k) of Article VII;
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere
with the ordinary conduct of business of the Borrower or any Restricted
Subsidiary; and
(g) bankers' rights of setoff and other like Liens imposed by law;
provided that the term "Permitted Encumbrances" shall not include any Lien
--------
securing Indebtedness.
"Permitted Investments" means:
---------------------
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed
by the full faith and credit of the United
15
States of America), in each case maturing within one year from the date of
acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the
date of acquisition thereof and having, at such date of acquisition, the
highest credit rating obtainable from S&P or from Moody's;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within one year from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts
issued or offered by, any domestic office of any commercial bank organized
under the laws of the United States of America or any State thereof which
has a combined capital and surplus and undivided profits of not less than
$500,000,000;
(d) fully collateralized repurchase agreements with a term of not more
than 30 days for securities described in clause (a) above and entered into
with a financial institution satisfying the criteria described in clause
(c) above; and
(e) shares of any mutual fund the investment guidelines of which
restrict such fund's investments to those closely resembling the criteria
set forth in any one or more of clauses (a) through (d) above; provided
--------
such fund has total assets of not less than $1,000,000,000.
"Permitted Preferred Stock" means capital stock of the Borrower (other
-------------------------
than Disqualified Stock) of any class or classes (however designated) that is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of the Borrower,
over shares of capital stock of any other class of the Borrower.
"Person" means any natural person, corporation, limited liability
------
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
----
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
16
"Prepayment Event" means:
----------------
(a) the issuance on or after the date hereof by the Borrower of any
equity securities, or the receipt by the Borrower of any capital
contribution, other than (i) the issuance of equity securities pursuant to
stock option, stock purchase and other similar plans for officers,
directors or employees of the Borrower or any Subsidiary and (ii) the
issuance of equity securities pursuant to the exercise of the Warrants and
any warrants or stock options outstanding on the date hereof; or
(b) the incurrence on or after the date hereof by the Borrower or any
Restricted Subsidiary of any Indebtedness described in clause (a), (b) or
(c) of the definition of "Indebtedness" and having a stated maturity more
than one year from the date of incurrence thereof, other than (i)
Indebtedness in respect of the Loans, (ii) Indebtedness incurred under the
Purchase Money Credit Agreement, (iii) Indebtedness owed to the Borrower or
a Subsidiary, (iv) Indebtedness to the extent such Indebtedness is incurred
to refinance other Indebtedness or (v) Indebtedness described in Section
6.01(d);
provided that the first $50,000,000 of Net Proceeds received in respect of
--------
events described in clauses (a) and (b) above (combined) shall be deemed not to
be Net Proceeds of a "Prepayment Event".
"Prime Rate" means the rate of interest per annum published from time
----------
to time in the "Money Rates" column (or any successor column) of The Wall Street
Journal as the prime rate or, if such rate shall cease to be so published or is
not available for any reason, the rate of interest publicly announced from time
to time by any commercial bank based in New York City selected by the
Administrative Agent for the purpose of quoting such rate, provided such
commercial bank has a combined capital and surplus and undivided profits of not
less than $500,000,000. Each change in the Prime Rate shall be effective from
and including the date such change is published.
"Purchase Agreement" means the Purchase Agreement dated April 24,
------------------
1998, as amended and restated as of July 24, 1998, between Lucent and the
Borrower.
"Purchase Money Credit Agreement" means the Credit Agreement dated as
----
of the date hereof among the Borrower, the lenders party thereto and Lucent, as
Administrative
17
Agent, including any Additional Loan Supplements (as defined therein).
"Register" has the meaning set forth in Section 9.04.
--------
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement dated as of August 26, 1998, between the Borrower and Lucent.
"Related Parties" means, with respect to any specified Person, such
---------------
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Repayment" means, in respect of any Indebtedness, the direct or
---------
indirect repayment, prepayment, redemption, purchase, acquisition, defeasance,
retirement or other satisfaction of the principal of such Indebtedness, in whole
or in part, whether optional or mandatory. "Repay" has a meaning correlative
-----
thereto.
"Required Lenders" means, at any time, Lenders having outstanding
----------------
Loans and Commitments representing more than 50% of the sum of the total
outstanding Loans and Commitments at such time.
"Restricted Payment" means (a) any dividend or other distribution
------------------
(whether in cash, securities or other property) with respect to any shares of
any class of capital stock of the Borrower or any Restricted Subsidiary, or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancelation or termination of any shares of any class of capital
stock of the Borrower or any Restricted Subsidiary or any option, warrant or
other right to acquire any such shares of capital stock of the Borrower or any
Restricted Subsidiary or (b) any Repayment in respect of any Subordinated
Indebtedness.
"Restricted Subsidiary" means any Subsidiary that is not an
---------------------
Unrestricted Subsidiary.
"S&P" means Standard & Poor's.
---
"Statutory Reserve Rate" means a fraction (expressed as a decimal),
----------------------
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental
18
reserves) expressed as a decimal established by the Board to which any
commercial banks subject to regulation by the Board are subject with respect to
the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D. LIBOR
Loans shall be deemed to constitute eurocurrency funding and to be subject to
such reserve requirements without benefit of or credit for proration, exemptions
or offsets that may be available from time to time to any Lender under such
Regulation D or any comparable regulation. The Statutory Reserve Rate shall be
adjusted automatically on and as of the effective date of any change in any
reserve percentage.
"Subordinated Indebtedness" means any Indebtedness of the Borrower
-------------------------
that is, by its terms, subordinated in right of payment to the payment of the
obligations of the Borrower hereunder.
"subsidiary" means, with respect to any Person (the "parent") at any
---------- ------
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower.
----------
"Taxes" means any and all present or future taxes, levies, imposts,
-----
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Telecommunications Assets" means all assets (including FCC Licenses
-------------------------
and assets consisting of subscribers), rights (contractual or otherwise) and
properties, whether tangible or intangible, used in connection with the business
of (i) providing voice, video or data communications services, (ii) creating,
developing, marketing or selling communications related equipment, software and
other devices or (iii) evaluating,
19
participating in or pursuing any other activity or opportunity that is related
or incidental to those identified in clauses (i) or (ii).
"Transactions" means the execution, delivery and performance by the
------------
Borrower of the Loan Documents, the borrowing of Loans and the use of the
proceeds thereof.
"Type", when used in reference to any Loan or Borrowing, refers to
----
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"Unrestricted Subsidiary" means any Subsidiary that is designated as
-----------------------
an Unrestricted Subsidiary by the Board of Directors of the Borrower (and any
subsidiary of an Unrestricted Subsidiary); provided that a Subsidiary shall not
--------
be an Unrestricted Subsidiary unless such Subsidiary and each of its
subsidiaries (a) has no Indebtedness other than Non-Recourse Debt; (b) is not
party to any agreement, contract, arrangement or understanding with the Borrower
or any Restricted Subsidiary unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to the Borrower or such
Restricted Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of the Borrower; (c) is a Person with respect to which
neither the Borrower nor any Restricted Subsidiary has any direct or indirect
obligation (i) to subscribe for additional equity interests, except to the
extent that such obligation complies with Section 6.04, or (ii) to maintain or
preserve such Person's financial condition or to cause such Person to achieve
any specified levels of operating results; and (d) prior to the time such
Subsidiary is designated an Unrestricted Subsidiary, does not Guarantee or
otherwise directly or indirectly provide credit support for any Indebtedness of
the Borrower or any Restricted Subsidiary. Any such designation by the Board of
Directors of the Borrower shall be evidenced to the Administrative Agent by
filing with the Administrative Agent a certified copy of the resolution of the
Board of Directors of the Borrower giving effect to such designation and a
Financial Officer's certificate certifying that such designation complied with
the foregoing conditions and was permitted by Section 6.04. If, at any time,
any Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Agreement and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary as of such
date (and, if such Indebtedness is not
20
permitted to be incurred hereunder as of such date an Event of Default shall be
deemed to have occurred). The Board of Directors of the Borrower may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
--------
that such designation shall be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation shall only be permitted if (i) such Indebtedness
is permitted hereunder at the time and (ii) no Default shall have occurred and
be continuing at the time of, or would result from, such designation.
"Warrant" means a Fair Market Warrant or a ▇▇▇▇▇ Warrant.
-------
"Withdrawal Liability" means liability to a Multiemployer Plan as a
--------------------
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes
------------
of this Agreement, Loans and Borrowings may be classified and referred to by
Type (e.g., a "LIBOR Loan" or a "LIBOR Borrowing").
----
SECTION 1.03. Terms Generally. The definitions of terms herein shall
----------------
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including"
shall be deemed to be followed by the phrase "without limitation". The word
"will" shall be construed to have the same meaning and effect as the word
"shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words "asset" and "property" shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash,
21
securities, accounts, contract rights, licenses and intellectual property.
SECTION 1.04. Accounting Terms; GAAP. (a) Except as otherwise
-----------------------
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided
--------
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.
(b) Each reference herein to any financial term, definition or
computation that is to be calculated for or with respect to the Borrower and the
Restricted Subsidiaries on a consolidated basis in accordance with GAAP shall be
calculated excluding and without giving effect to Unrestricted Subsidiaries or
any investment therein or earnings thereon, except to the extent otherwise
expressly provided herein.
ARTICLE II
The Loans
---------
SECTION 2.01. Commitments. Subject to the terms and conditions set
------------
forth herein, each Lender agrees to make Loans to the Borrower at any time and
from time to time during the Availability Period in an aggregate principal
amount that will not result in (a) such Lender's Credit Exposure exceeding such
Lender's Commitment or (b) the sum of the total Credit Exposures exceeding the
total Commitments; provided that the aggregate principal amount of Loans made
--------
prior to the Full Availability Date shall not exceed the Initial Loan Limit.
Within the foregoing limits and subject to the terms and conditions set forth
herein, the Borrower may borrow, prepay and reborrow Loans.
SECTION 2.02. Loans and Borrowings. (a) Each Loan shall be made as
---------------------
part of a Borrowing consisting of
22
Loans of the same Type made by the Lenders ratably in accordance with their
respective Commitments. The failure of any Lender to make any Loan required to
be made by it shall not relieve any other Lender of its obligations hereunder;
provided that the Commitments of the Lenders are several and no Lender shall be
--------
responsible for any other Lender's failure to make Loans as required.
(b) Subject to Section 2.10, each Borrowing shall be comprised
entirely of LIBOR Loans or ABR Loans as the Borrower may request in accordance
herewith. Each Lender at its option may make any LIBOR Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan;
provided that any exercise of such option shall not affect the obligation of the
--------
Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any LIBOR
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $500,000 and not less than $2,500,000. At the time that each ABR
Borrowing is made, such Borrowing shall be in an aggregate amount that is an
integral multiple of $500,000 and not less than $2,500,000; provided that an ABR
--------
Borrowing may be in an aggregate amount that is equal to the entire unused
balance of the Commitments. Borrowings of more than one Type may be outstanding
at the same time; provided that there shall not at any time be more than a total
--------
of five LIBOR Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing as a LIBOR Borrowing if the Interest Period requested with respect
thereto would end after the Maturity Date.
SECTION 2.03. Requests for Borrowings. To request a Borrowing, the
------------------------
Borrower shall notify the Administrative Agent of such request by telephone (a)
in the case of a LIBOR Borrowing, not later than 2:00 p.m., New York City time,
three Business Days before the date of the proposed Borrowing or (b) in the case
of an ABR Borrowing, not later than 2:00 p.m., New York City time, three
Business Day before the date of the proposed Borrowing; provided that the
--------
Borrower may make only three requests for Borrowings in any single calendar
month (it being understood that all Borrowings made by the Borrower on the same
date shall be treated as a single request for a Borrowing for purposes of this
limitation). Each such telephonic Borrowing Request shall be irrevocable and
shall be confirmed promptly by hand delivery or telecopy to the Administrative
Agent of a
23
written Borrowing Request in a form approved by the Administrative Agent and
signed by the Borrower. Each such telephonic and written Borrowing Request shall
specify the following information in compliance with Section 2.02:
(i) the aggregate amount of such Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be a LIBOR Borrowing or an ABR
Borrowing;
(iv) in the case of a LIBOR Borrowing, the initial Interest Period to
be applicable thereto, which shall be a period contemplated by the
definition of the term "Interest Period"; and
(v) the location and number of the Borrower's account to which funds
are to be disbursed, which shall comply with the requirements of Section
2.04.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested LIBOR Borrowing, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. Funding of Borrowings. (a) Each Lender shall make
----------------------
each Loan to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds by 12:00 noon, New York City time, to
the account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower maintained with the Administrative Agent
(or a bank designated by the Administrative Agent) and designated by the
Borrower in the applicable Borrowing Request.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such
24
Lender has made such share available on such date in accordance with paragraph
(a) of this Section and may, in reliance upon such assumption, make available to
the Borrower a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is made available
to the Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation or (ii) in the case of the
Borrower, the interest rate applicable to ABR Loans. If such Lender pays such
amount to the Administrative Agent, then such amount shall constitute such
Lender's Loan included in such Borrowing.
SECTION 2.05. Interest Elections. (a) Each Borrowing initially
-------------------
shall be of the Type specified in the applicable Borrowing Request and, in the
case of a LIBOR Borrowing, shall have an initial Interest Period as specified in
such Borrowing Request. Thereafter, the Borrower may elect to convert such
Borrowing to a different Type or to continue such Borrowing and, in the case of
a LIBOR Borrowing, may elect Interest Periods therefor, all as provided in this
Section. The Borrower may elect different options with respect to different
portions of the affected Borrowing, in which case each such portion shall be
allocated ratably among the Lenders holding the Loans comprising such Borrowing,
and the Loans comprising each such portion shall be considered a separate
Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the Borrower.
25
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to
clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);
(ii) the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be a LIBOR Borrowing or an
ABR Borrowing; and
(iv) if the resulting Borrowing is a LIBOR Borrowing, the Interest
Period to be applicable thereto after giving effect to such election, which
shall be a period contemplated by the definition of the term "Interest
Period".
If any such Interest Election Request requests a LIBOR Borrowing but does not
specify an Interest Period, then the Borrower shall be deemed to have selected
an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a LIBOR Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies the Borrower, then, so long as an
Event of Default is continuing (i) no outstanding Borrowing may be converted to
or continued as a LIBOR Borrowing and (ii) unless repaid, each LIBOR Borrowing
shall be converted to an ABR Borrowing at the end of the Interest Period
applicable thereto.
26
SECTION 2.06. Termination and Reduction of Commitments. (a) Unless
-----------------------------------------
previously terminated, the Commitments shall terminate on the Maturity Date.
(b) The Commitments shall be reduced as and when required by Section
2.08(b).
(c) The Borrower may at any time terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
--------
pursuant to this paragraph (c) shall be in an amount that is an integral
multiple of $1,000,000 and not less than $5,000,000 and (ii) the Borrower shall
not terminate or reduce the Commitments if, after giving effect to any
concurrent prepayment of the Loans in accordance with Section 2.08, the sum of
the Credit Exposures would exceed the total Commitments.
(d) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (c) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any such notice, the Administrative
Agent shall advise the Lenders of the contents thereof. Each notice delivered
by the Borrower pursuant to this Section shall be irrevocable. Any termination
or reduction of the Commitments shall be permanent. Each reduction of the
Commitments pursuant to paragraph (b) or (c) of this Section shall be made
ratably among the Lenders in accordance with their respective Commitments.
SECTION 2.07. Repayment of Loans; Evidence of Debt. (a) The
-------------------------------------
Borrower hereby unconditionally promises to pay to the Administrative Agent for
the account of each Lender the then unpaid principal amount of each Loan on the
Maturity Date.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Type thereof and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable
27
from the Borrower to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder for the account of the Lenders
and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this Section shall be prima facie evidence of the existence and
----- -----
amounts of the obligations recorded therein; provided that the failure of any
--------
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender such a promissory note payable to the order of such Lender (or,
if requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
SECTION 2.08. Prepayment of Loans. (a) The Borrower shall have the
--------------------
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to the requirements of this Section.
(b) In the event and on each occasion that any Net Proceeds are
received by or on behalf of the Borrower or any Restricted Subsidiary in respect
of any Prepayment Event, then (i) the Commitments shall be ratably reduced by an
amount equal to such Net Proceeds and (ii) the Borrower shall prepay Borrowings
in an aggregate amount equal to the excess, if any, of the sum of the Credit
Exposures over the total Commitments after giving effect to such reduction.
(c) Prior to any optional or mandatory prepayment of Borrowings
hereunder, the Borrower shall select the Borrowing or Borrowings to be prepaid
and shall specify such selection in the notice of such prepayment pursuant to
paragraph (d) of this Section; provided that each prepayment of Borrowings shall
--------
be applied to prepay ABR Borrowings before any other Borrowings.
28
(d) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder, and of any reduction of the
Commitments pursuant to paragraph (b) of this Section, not later than 11:00
a.m., New York City time, three Business Days before the date of such prepayment
or reduction, as the case may be. Each such notice shall be irrevocable and
shall specify (i) in the case of a prepayment, the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid or (ii) in
the case of a reduction of Commitments, the date of such reduction and a
reasonably detailed calculation of the amount thereof. Promptly following
receipt of any such notice, the Administrative Agent shall advise the Lenders of
the contents thereof. Each partial prepayment of any Borrowing shall be in an
amount that would be permitted in the case of an advance of a Borrowing of the
same Type as provided in Section 2.02, except as necessary to apply fully the
required amount of a mandatory prepayment. Each prepayment of a Borrowing shall
be applied ratably to the Loans included in the prepaid Borrowing. Prepayments
of Borrowings shall be accompanied by the payment of accrued interest on the
amount prepaid.
SECTION 2.09. Interest; Warrants. (a) The Loans comprising each ABR
-------------------
Borrowing shall bear interest at the Alternate Base Rate plus 4.00%, subject to
increase as provided in paragraph (c) of this Section.
(b) The Loans comprising each LIBOR Borrowing shall bear interest at
the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus
5.00%, subject to increase as provided in paragraph (c) of this Section.
(c) The interest rates set forth in paragraphs (a) and (b) of this
Section shall increase by 0.50% effective on the last day of each calendar
month, commencing on the last day of January, 1999 (with successive increases
effective on the last day of each calendar month thereafter).
(d) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any other amount payable by the Borrower hereunder is not paid when
due, whether at stated maturity, upon acceleration or otherwise, such overdue
amount shall bear interest, after as well as before judgment, at a rate per
annum equal to 2.00% plus the rate then applicable to ABR Loans as provided in
paragraph (a) of this Section (giving effect to any increases thereto pursuant
to paragraph (c) of this Section).
29
(e) All accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan and upon termination of the
Commitments; provided that (i) interest accrued pursuant to paragraph (d) of
--------
this Section shall be payable on demand, (ii) in the event of any repayment or
prepayment of any Loan, accrued interest on the principal amount of such Loan
repaid or prepaid shall be payable on the date of such repayment or prepayment
and (iii) in the event of any conversion of any Loan prior to the end of the
current Interest Period therefor, accrued interest on such Loan shall be payable
on the effective date of such conversion.
(f) All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to the Alternate Base
Rate at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate or
Adjusted LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
(g) As additional consideration for the Commitments and Loans
hereunder, the Borrower agrees to issue to Lucent (in addition to the ▇▇▇▇▇
Warrant previously issued to Lucent on August 26, 1998): (i) on the Effective
Date, a ▇▇▇▇▇ Warrant to purchase 139,122 shares of common stock of the Borrower
(which the Borrower represents and warrants to represent 0.5% of the Borrower's
outstanding shares of common stock as of the Effective Date, on a fully diluted
basis) and (ii) within five Business Days of the date of each Borrowing that
results in the sum of the Credit Exposures equaling or exceeding $2,500,000 or
any integral multiple of $2,500,000, a Fair Market Warrant to purchase the
number of shares of common stock of the Borrower determined by multiplying (A)
63,996 shares of common stock of the Borrower (which the Borrower represents and
warrants to represent 0.23% of the Borrower's outstanding shares of common stock
as of the Effective Date, on a fully diluted basis) by (B) an amount equal to
the sum of the Credit Exposures after giving effect to such Borrowing (rounded
down, if not an integral multiple of $2,500,000, to the nearest integral
multiple of $2,500,000) divided by $2,500,000; provided that, if the Borrower
--------
has previously issued any Fair Market Warrants hereunder at the time any Fair
Market Warrants are required to be issued pursuant to this paragraph, the amount
determined pursuant to clause (B) above shall be reduced by the amount (or the
sum of the
30
amounts, if applicable) previously determined pursuant to clause (B) for
purposes of issuing such previously issued Fair Market Warrants. The number of
shares of common stock set forth in clause (ii)(A) of the preceding sentence,
and the "Exercise Price" specified in the definition of "Fair Market Warrant",
shall be subject to adjustment after the Effective Date in accordance with the
adjustment provisions of the form of Fair Market Warrant attached as Exhibit B
hereto, such that, upon the issuance of any Fair Market Warrant, the number of
shares of the Borrower's common stock subject to purchase thereunder and the
Exercise Price thereof are the same as would then be in effect if such Fair
Market Warrant had been issued on the Effective Date.
SECTION 2.10. Alternate Rate of Interest. If prior to the
---------------------------
commencement of any Interest Period for a LIBOR Borrowing:
(a) the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that
the Adjusted LIBO Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their
Loans included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a LIBOR Borrowing shall be ineffective and
(ii) if any Borrowing Request requests a LIBOR Borrowing, such Borrowing shall
be made as an ABR Borrowing.
SECTION 2.11. Increased Costs. (a) If any Change in Law shall:
----------------
(i) impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of,
or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate); or
31
(ii) impose on any Lender or the London interbank market any other
condition affecting this Agreement or LIBOR Loans made by such Lender;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any LIBOR Loan (or of maintaining its obligation
to make any such Loan) or to reduce the amount of any sum received or receivable
by such Lender hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender such additional amount or amounts as will
compensate such Lender for such additional costs incurred or reduction suffered.
(b) If any Lender determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Lender's capital or on the capital of such Lender's holding company, if any, as
a consequence of this Agreement or the Loans made by such Lender to a level
below that which such Lender or such Lender's holding company could have
achieved but for such Change in Law (taking into consideration such Lender's
policies and the policies of such Lender's holding company with respect to
capital adequacy), then from time to time the Borrower will pay to such Lender
such additional amount or amounts as will compensate such Lender or such
Lender's holding company for any such reduction suffered.
(c) A certificate of a Lender setting forth the amount or amounts
necessary to compensate such Lender or its holding company, as the case may be,
as specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.
(d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender's right to
demand such compensation; provided that the Borrower shall not be required to
--------
compensate a Lender pursuant to this Section for any increased costs or
reductions incurred more than 180 days prior to the date that such Lender
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender's intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs
-------- -------
or reductions is retroactive, then the 180-day period referred to above shall be
extended to include the period of retroactive effect thereof.
32
SECTION 2.12. Break Funding Payments. In the event of (a) the
-----------------------
payment of any principal of any LIBOR Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any LIBOR Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Loan on the date specified in any notice delivered pursuant
hereto, or (d) the assignment of any LIBOR Loan other than on the last day of
the Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.15, then, in any such event, the Borrower shall compensate
each Lender for the loss, cost and expense attributable to such event. In the
case of a LIBOR Loan, such loss, cost or expense to any Lender shall be deemed
to include an amount determined by such Lender to be the excess, if any, of (i)
the amount of interest which would have accrued on the principal amount of such
Loan had such event not occurred, at the Adjusted LIBO Rate that would have been
applicable to such Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, convert or continue, for the period that would have been the Interest
Period for such Loan), over (ii) the amount of interest which would accrue on
such principal amount for such period at the interest rate which such Lender
would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof.
SECTION 2.13. Taxes. (a) Any and all payments by or on account of
------
any obligation of the Borrower hereunder or under any other Loan Document shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes; provided that if the Borrower shall be required to deduct any
--------
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent or Lender receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
33
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent and each
Lender, within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent or such Lender
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder or under any other Loan Document (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender, or by the Administrative Agent
on its own behalf or on behalf of a Lender, shall be conclusive absent manifest
error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the United States of America, or
any treaty to which the United States of America is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law or
reasonably requested by the Borrower as will permit such payments to be made
without withholding or at a reduced rate.
SECTION 2.14. Payments Generally; Pro Rata Treatment; Sharing of Set-
------------------------------------------------------
offs. (a) The Borrower shall make each payment required to be made by it
-----
hereunder or under any other Loan Document (whether of principal or interest, or
of amounts payable under Section 2.11, 2.12 or 2.13 or otherwise) prior to 2:00
p.m., New York City time, on the date when due, in immediately available funds,
without set-off or counterclaim. Any amounts received after
34
such time on any date may, in the discretion of the Administrative Agent, be
deemed to have been received on the next succeeding Business Day for purposes of
calculating interest thereon. All such payments shall be made to the
Administrative Agent at The Chase Manhattan Bank, New York, New York, ABA no.
▇▇▇▇▇▇▇▇▇, account no. ▇▇▇▇▇▇▇▇▇▇, phone no. (▇▇▇) ▇▇▇-▇▇▇▇ (or such other
account as the Administrative Agent shall from time to time specify by notice),
except that payments pursuant to Sections 2.11, 2.12, 2.13 and 9.03 shall be
made directly to the Persons entitled thereto and payments pursuant to other
Loan Documents shall be made to the Persons specified therein. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment under any Loan Document shall be due on a day
that is not a Business Day, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
under each Loan Document shall be made in dollars.
(b) If at any time insufficient funds are received by and available
to the Administrative Agent to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied (i) first, towards payment
of interest and fees then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of interest and fees then due to such
parties, and (ii) second, towards payment of principal then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans of other Lenders to the extent necessary so that the
benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans; provided that (i) if any such participations are
--------
purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph
35
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans to any assignee or participant, other than to
the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions
of this paragraph shall apply). The Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set-off and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation.
(e) Without limiting the generality of paragraph (a) above, the
Borrower's obligations to make each payment required to be made by it hereunder
or under any other Loan Document (whether of principal, interest, fees or
otherwise) shall be absolute and unconditional and shall not be subject to any
delay, reduction, set-off, counterclaim, defense or recoupment for any reason,
including any failure of the Network or any part thereof, or any dispute with,
breach of representation or warranty by or claim against any supplier,
manufacturer, installer, vendor or distributer, including Lucent.
SECTION 2.15. Mitigation Obligations; Replacement of Lenders. (a)
-----------------------------------------------
If any Lender requests compensation under Section 2.11, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
36
Authority for the account of any Lender pursuant to Section 2.13, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.11 or 2.13, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.11, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.13,
then the Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in Section 9.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
--------
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
such assignment will result in a reduction in such compensation or payments. A
Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.
SECTION 2.16. Extension of Maturity Date. The Borrower may at any
---------------------------
time request that the Maturity Date then in effect be extended to a date that is
up to three months after such Maturity Date. Any such request shall be made by
written notice to the Administrative Agent not more than 30 days and not less
than 15 days prior to the Maturity Date then in effect, and the Administrative
Agent shall promptly notify each Lender of such request and shall respond to
such
37
request in writing within five Business Days after receipt thereof; provided
--------
that if the Administrative Agent fails to respond to such request within such
period, the Lenders shall be deemed to have declined such request. The
Administrative Agent shall consent to any such request only if all the Lenders
shall consent to such request. If (and only if) all the Lenders consent to such
request, then the Maturity Date then in effect shall be extended to the date
specified in such request; provided that in no event shall the Maturity
--------
Date be extended to a date that is later than the first anniversary of the
Effective Date.
ARTICLE III
Representations and Warranties
------------------------------
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and the
---------------------
Restricted Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, has all requisite power
and authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
SECTION 3.02. Authorization; Enforceability. The Transactions are
-----------------------------
within the Borrower's corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. Each of the Loan
Documents has been duly executed and delivered by the Borrower and constitutes a
legal, valid and binding obligation of the Borrower, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors' rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions
-------------------------------------
(a) do not require any consent or approval of, registration or filing with, or
any other action by, any Governmental Authority, except such as have been
obtained or made and are in full force and effect and except as contemplated by
the Registration Rights Agreement
38
in connection with the performance thereof, (b) will not violate any applicable
law or regulation or the charter, by-laws or other organizational documents of
any Loan Party or any order of any Governmental Authority, (c) will not violate
or result in a default under any indenture, agreement or other instrument
binding upon any Loan Party or its assets, or give rise to a right thereunder to
require any payment to be made by any Loan Party, and (d) will not result in the
creation or imposition of any Lien on any asset of any Loan Party.
SECTION 3.04. Financial Condition; No Material Adverse Change. (a)
------------------------------------------------
The Borrower has heretofore furnished to the Lenders its consolidated balance
sheet and statements of income, stockholders equity and cash flows (i) as of and
for the fiscal year ended December 31, 1997, reported on by
PricewaterhouseCoopers LLP (successor to Coopers & ▇▇▇▇▇▇▇, L.L.P.), independent
public accountants, and (ii) as of and for the fiscal quarter and the portion of
the fiscal year ended June 30, 1998, certified by its chief financial officer.
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and
its consolidated subsidiaries as of such dates and for such periods in
accordance with GAAP, subject to year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.
(b) Since June 30, 1998, there has been no material adverse change in
the business, condition (financial or otherwise), operations, performance or
properties of the Borrower and the Restricted Subsidiaries, taken as a whole.
SECTION 3.05. Properties and Licenses. (a) Each of the Loan Parties
------------------------
has good title to, or valid leasehold interests in, all the real and personal
property material to its business owned or leased by it, except for defects in
title that do not interfere with its ability to conduct its business as
currently conducted and could not, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect.
(b) Each of the Loan Parties owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Loan Parties does not
infringe upon the rights of any other Person, except for any such infringements
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.
39
(c) Schedule 3.05 sets forth all FCC Licenses existing as of the
Effective Date and all other licenses and permits in effect as of the Effective
Date that are material to the business of the Borrower and the Restricted
Subsidiaries. Each of the FCC Licenses, and each other license or permit that
is material to the business of the Borrower and the Restricted Subsidiaries, is
valid and in full force and effect, and the Borrower and the Restricted
Subsidiaries are in compliance with the terms and conditions thereof except
where the failure to so comply could not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06. Litigation and Environmental Matters. (a) There are
-------------------------------------
no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of its Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve any of the Loan Documents or the Transactions.
(b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, none of the Borrower or any of
its Subsidiaries (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
(c) Since the date of this Agreement, there has been no change in the
status of the Disclosed Matters that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect.
SECTION 3.07. Compliance with Laws and Agreements. Each of the
------------------------------------
Borrower and its Subsidiaries is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be
40
expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.
SECTION 3.08. Investment and Holding Company Status. None of the
--------------------------------------
Loan Parties is (a) an "investment company" as defined in, or subject to
regulation under, the Investment Company Act of 1940 or (b) a "holding company"
as defined in, or subject to regulation under, the Public Utility Holding
Company Act of 1935.
SECTION 3.09. Taxes. Each of the Loan Parties has timely filed or
------
caused to be filed all Tax returns and reports required to have been filed and
has paid or caused to be paid all Taxes required to have been paid by it, except
(a) Taxes that are being contested in good faith by appropriate proceedings and
for which the applicable Loan Party has set aside on its books adequate reserves
or (b) the filing of state or local Tax returns and reports, or the payment of
state or local Taxes, to the extent that the failure to do so, individually or
in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred.
------
SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders
-----------
all material agreements, instruments and corporate or other restrictions to
which any of the Loan Parties is subject, and all other matters known to any of
them, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. None of the reports, financial statements,
certificates or other written information concerning the Borrower or its
Subsidiaries furnished by or on behalf of any Loan Party to the Administrative
Agent or any Lender in connection with the negotiation of this Agreement or any
other Loan Document or delivered hereunder or thereunder (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
--------
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.12. Subsidiaries. Schedule 3.12 sets forth as of the
-------------
Effective Date the name of, and the ownership interest of the Borrower in, each
Subsidiary of
41
the Borrower and identifies each such Subsidiary (if any) that is an
Unrestricted Subsidiary or a License Subsidiary.
SECTION 3.13. Insurance. Schedule 3.13 sets forth a description of
----------
all insurance maintained by or on behalf of the Borrower and its Subsidiaries as
of the Effective Date. As of the Effective Date, all premiums then due and
payable in respect of such insurance have been paid.
SECTION 3.14. Labor Matters. As of the Effective Date, there are no
--------------
strikes, lockouts or slowdowns against any Loan Party pending or, to the
knowledge of the Borrower, threatened. The hours worked by and payments made to
employees of the Loan Parties have not been in violation of the Fair Labor
Standards Act or any other applicable Federal, state, local or foreign law
dealing with such matters, except for such violations that could not reasonably
be expected, individually or in the aggregate, to result in a Material Adverse
Effect. All payments due from any Loan Party, or for which any claim may be
made against any Loan Party, on account of wages and employee health and welfare
insurance and other benefits, have been paid or accrued as a liability on the
books of the applicable Loan Party, except for such failures to so pay or accrue
that could not reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect. The consummation of the Transactions will
not give rise to any right of termination or right of renegotiation on the part
of any union under any collective bargaining agreement to which any Loan Party
is bound.
SECTION 3.15. Purchase Agreement. The Purchase Agreement is in full
-------------------
force and effect. The Borrower is in substantial compliance with the terms and
conditions of the Purchase Agreement.
ARTICLE IV
Conditions
----------
SECTION 4.01. Effective Date. The obligations of the Lenders to make
---------------
Loans hereunder shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received
from each party hereto either (i) a counterpart of this Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the
42
Administrative Agent (which may include telecopy transmission of a signed
signature page of this Agreement) that such party has signed a counterpart
of this Agreement;
(b) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated
the Effective Date) of each of (i) Ropes & ▇▇▇▇, counsel for the Borrower,
substantially in the form of Exhibit A-1, (ii) Wiley, Rein & Fielding,
special FCC counsel for the Borrower, substantially in the form of Exhibit
A-2, and (iii) Cravath, Swaine & ▇▇▇▇▇, counsel for Lucent, substantially
in the form of Exhibit A-3, and, in the case of each such opinion required
by this paragraph, covering such other matters relating to the Loan
Parties, the Loan Documents or the Transactions as the Administrative Agent
shall reasonably request. The Borrower hereby requests its counsel
referred to in clauses (i) and (ii) of this paragraph to deliver such
opinions.
(c) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization, existence and good standing of the
Borrower, the authorization of the Transactions and any other legal matters
relating to the Loan Parties, the Loan Documents or the Transactions, all
in form and substance satisfactory to the Administrative Agent and its
counsel.
(d) The Administrative Agent shall have received a certificate, dated
the Effective Date and signed by the President, a Vice President or a
Financial Officer of the Borrower, confirming compliance with the
conditions set forth in paragraphs (a), (b) and (c) of Section 4.02.
(e) The Administrative Agent and Lucent shall have received all
amounts due and payable to them hereunder on or prior to the Effective
Date, including, to the extent invoiced, reimbursement or payment of all
expenses required to be reimbursed or paid by the Borrower hereunder.
(f) The Lenders shall be satisfied with the corporate and legal
structure and capitalization of the Borrower and the Restricted
Subsidiaries, including the charter and by-laws of the Borrower and each
Restricted
43
Subsidiary and each agreement or instrument evidencing Indebtedness.
(g) All FCC Licenses shall be owned by the Borrower or a License
Subsidiary. No event shall have occurred that would subject any FCC
License to revocation by the FCC, except for such FCC Licenses the loss of
which could not reasonably be expected, individually or in the aggregate,
to result in a Material Adverse Effect.
(h) The Lenders shall have received the Borrower's most recent
Business Plan, including financial projections, and there shall have been
no material adverse changes in the Business Plan compared to the
information disclosed to Lucent prior to June 18, 1998.
(i) All material intercompany agreements and arrangements between the
Borrower or any wholly owned Restricted Subsidiary, on the one hand, and
any Unrestricted Subsidiary, any Restricted Subsidiary that is not a wholly
owned Restricted Subsidiary or any other Affiliate of the Borrower or any
wholly owned Restricted Subsidiary, on the other hand, with respect to tax
sharing, management fee or servicing fee agreements, arrangements or
relationships shall have been completed on terms and conditions (including
with respect to the subordination of any obligations to pay any fees
thereunder to the prior payment in full of the obligations of the Borrower
hereunder) reasonably satisfactory to the Lenders and shall have been set
forth in written agreements (the "Intercompany Agreements") reasonably
-----------------------
satisfactory in form and substance to the Lenders. True and correct copies
of all Intercompany Agreements shall have been delivered to the Lenders.
(j) The Borrower shall have executed and delivered to Lucent the
▇▇▇▇▇ Warrant required to be issued on the Effective Date as contemplated
by Section 2.09(g).
(k) The Purchase Money Credit Agreement shall have been executed and
delivered by the parties thereto.
The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans
hereunder shall not
44
become effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on
September 30, 1998 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).
SECTION 4.02. Each Borrowing. The obligation of each Lender to make
---------------
a Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) At the time of and immediately after giving effect to such
Borrowing, the representations and warranties of the Borrower set forth
herein shall be true and correct (or, in the case of representations and
warranties that are not qualified as to materiality, true and correct in
all material respects) on and as of the date of such Borrowing (except to
the extent such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct as of such
earlier date).
(b) At the time of and immediately after giving effect to such
Borrowing no Default shall have occurred and be continuing.
(c) At the time of and immediately after giving effect to such
Borrowing, the Purchase Agreement shall be in full force and effect and the
Borrower shall be in substantial compliance therewith.
(d) At the time of such Borrowing, the Borrower shall have issued to
Lucent all Warrants then required to be issued pursuant to Section 2.09(g).
Each Borrowing shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (a),
(b), (c) and (d) of this Section.
ARTICLE V
Affirmative Covenants
---------------------
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full, the Borrower covenants and agrees with the Lenders that:
45
SECTION 5.01. Financial Statements and Other Information. The
-------------------------------------------
Borrower will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the Borrower,
the audited consolidated balance sheet of the Borrower and related
statements of operations, stockholders' equity and cash flows as of the end
of and for such year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on by
PricewaterhouseCoopers LLP (successor to Coopers & ▇▇▇▇▇▇▇, L.L.P.) or
other independent public accountants of recognized national standing
(without, except for the audit with respect to the Borrower's 1998 fiscal
year, a "going concern" or like qualification or exception and without any
qualification or exception as to the scope of such audit) to the effect
that such consolidated financial statements present fairly in all material
respects the financial condition and results of operations of the Borrower
and its consolidated subsidiaries on a consolidated basis in accordance
with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, the consolidated balance
sheet of the Borrower and related statements of operations, stockholders'
equity and cash flows as of the end of and for such fiscal quarter and the
then elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of
(or, in the case of the balance sheet, as of the end of) the previous
fiscal year, all certified by one of its Financial Officers as presenting
fairly in all material respects the financial condition and results of
operations of the Borrower and its consolidated subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of the Borrower's financial
statements under clause (a) or (b) above, a certificate of a Financial
Officer of the Borrower (i) certifying as to whether a Default has occurred
and, if a Default has occurred, specifying the details thereof and any
action taken or proposed to be taken with respect thereto, (ii) stating
whether any change in GAAP or in the application thereof has occurred since
the date of the Borrower's audited
46
financial statements referred to in Section 3.04 and, if any such change
has occurred, specifying the effect of such change on the financial
statements accompanying such certificate, and (iii) if the financial
statements accompanying such certificate include consolidated financial
information for any Unrestricted Subsidiary, setting forth on a schedule
attached to such certificate a reasonably detailed calculation of all
adjustments to such financial statements necessary in order to reflect the
financial condition and results of operations of the Borrower and the
Restricted Subsidiaries on a consolidated basis in accordance with GAAP;
(d) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during
the course of their examination of such financial statements of any Default
(which certificate may be limited to the extent required by accounting
rules or guidelines);
(e) promptly after the same become available but in any event within
90 days after the end of each fiscal year of the Borrower, the Business
Plan for the current fiscal year and updated financial projections through
the Maturity Date;
(f) within 15 days after the end of each fiscal quarter of the
Borrower, a report setting forth (i) the number of buildings connected to
the Network and (ii) the number of the Borrower's customers (treating each
office location of a Person purchasing services from the Borrower as a
separate customer to the extent such office locations are in separate
buildings);
(g) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
the Borrower or any Subsidiary with the Securities and Exchange Commission,
or any Governmental Authority succeeding to any or all of the functions of
said Commission, or with any national securities exchange, or distributed
by the Borrower to its shareholders generally, as the case may be; and
(h) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of any Loan
47
Document, as the Administrative Agent may reasonably request.
SECTION 5.02. Notices of Material Events. The Borrower will furnish
---------------------------
to the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting the
Borrower or any Affiliate thereof that, if adversely determined, could
reasonably be expected to result in a Material Adverse Effect; and
(c) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
-------------------------------
will cause each of the Restricted Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of the business of the Borrower and the Restricted Subsidiaries,
taken as a whole; provided that the foregoing shall not prohibit any merger,
--------
consolidation, liquidation or dissolution permitted under Section 6.03.
SECTION 5.04. Payment of Obligations. The Borrower will, and will
-----------------------
cause each of the Restricted Subsidiaries to, pay its material Indebtedness and
other material obligations, including Tax liabilities, before the same shall
become delinquent or in default, except where (a) the validity or amount thereof
is being contested in good faith by appropriate proceedings, (b) the Borrower or
such Restricted Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP, (c) such contest effectively suspends
collection of the contested obligation and the enforcement of any Lien securing
such obligation and (d) the failure to make payment pending the resolution of
such contest could not reasonably be expected to result in a Material Adverse
Effect.
48
SECTION 5.05. Maintenance of Properties. The Borrower will, and will
--------------------------
cause each of the Restricted Subsidiaries to, keep and maintain all property
material to the conduct of the business of the Borrower and the Restricted
Subsidiaries, taken as a whole, in good working order and condition, ordinary
wear and tear excepted.
SECTION 5.06. Insurance. The Borrower will, and will cause each of
----------
the Restricted Subsidiaries to, maintain, with financially sound and reputable
insurance companies, insurance in such amounts and against such risks (including
fire and other risks insured by extended coverage) as are customarily maintained
by companies engaged in the same or similar businesses operating in the same or
similar locations, including public liability insurance against claims for
personal injury, death or property damage occurring upon, about or in connection
with the use of any properties owned, occupied or controlled by it as well as
such other insurance as may be required by law.
SECTION 5.07. Books and Records; Inspection Rights. The Borrower
-------------------------------------
will, and will cause each of the Restricted Subsidiaries to, keep proper books
of record and account in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of the Restricted Subsidiaries to, permit any
representatives designated by the Administrative Agent, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts from
its books and records, and to discuss its affairs, finances and condition with
its officers and independent accountants, all during normal business hours and
as often as reasonably requested, without unreasonable interference with the
Borrower's business.
SECTION 5.08. Compliance with Laws and Agreements. The Borrower
------------------------------------
will, and will cause each of the Subsidiaries to, comply with all laws, rules,
regulations and orders of any Governmental Authority (including ERISA and all
Environmental Laws) applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except (a)
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, or (b) where (i)
the failure to so comply is being contested in good faith by appropriate
proceedings, (ii) the Borrower or such Restricted Subsidiary has set aside on
its books adequate reserves with respect thereto in accordance with GAAP or, in
the case of a foreign Restricted Subsidiary, in accordance with applicable
accounting principles in the relevant jurisdiction, (iii) such contest
effectively
49
suspends the requirement to so comply and (iv) the failure to so comply pending
the resolution of such contest could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 5.09. Use of Proceeds. The proceeds of the Loans will be
----------------
used solely for working capital purposes of the Borrower and its Restricted
Subsidiaries, including the payment of accrued interest on Loans, but excluding
the purchase of equipment or services from any vendor or supplier other than
Lucent if such equipment or services are available from Lucent and are of the
type listed on Schedule 5.09.
SECTION 5.10. FCC Licenses. The Borrower will, and will cause each
------------
of the Restricted Subsidiaries to, maintain each FCC License in full force and
effect and comply with all terms and conditions thereof, except to the extent
that the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
ARTICLE VI
Negative Covenants
------------------
Until the Commitments have expired or terminated and the principal of
and interest on each Loan have been paid in full, the Borrower covenants and
agrees with the Lenders that:
SECTION 6.01. Indebtedness. The Borrower will not, nor will it
-------------
permit any Restricted Subsidiary to, create, incur, assume or permit to exist
any Indebtedness, except:
(a) Indebtedness created under this Agreement or the Purchase Money
Credit Agreement;
(b) subject to Sections 6.04 and 6.12, Indebtedness of the Borrower to
any Restricted Subsidiary and of any Restricted Subsidiary to the Borrower or
any other Restricted Subsidiary;
(c) subject to Section 6.04, Guarantees by the Borrower of
Indebtedness of any Restricted Subsidiary;
(d) Indebtedness of the Borrower or, subject to Section 6.12, any
Restricted Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or
50
capital assets or FCC licenses by the Borrower or such Restricted Subsidiary,
including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof; provided that (A) such Indebtedness is
--------
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvement and (B) any such Indebtedness incurred in
connection with any particular acquisition, construction or improvement shall
not exceed the cost of such acquisition, construction or improvement; provided
--------
further that the aggregate principal amount of such Indebtedness shall not
-------
exceed $20,000,000;
(e) Other Debt;
(f) Indebtedness outstanding on the Effective Date and set forth on
Schedule 6.01; and
(g) Indebtedness of the Borrower incurred to refinance any
Indebtedness referred to in clause (d) or (f) above and Indebtedness of any
Restricted Subsidiary incurred to refinance any Indebtedness of such Restricted
Subsidiary referred to in clause (d) or (f) above; provided that (i) the
--------
principal amount of any such Indebtedness does not exceed the principal amount
of, plus accrued interest and any prepayment premiums applicable to, the
Indebtedness refinanced thereby, (ii) any such Indebtedness has a scheduled
maturity date that is on or after the scheduled maturity date of the
Indebtedness refinanced thereby, (iii) any such Indebtedness has a weighted
average life to maturity that is equal to or longer than the remaining weighted
average life to maturity of the Indebtedness refinanced thereby (determined
immediately prior to giving effect to such refinancing), (iv) any such
Indebtedness does not include any provisions that may require mandatory
Repayment thereof prior to scheduled maturity, other than scheduled repayments
taken into account in determining compliance with clause (iii) above and other
provisions that are not materially more burdensome than any such provisions
included in the Indebtedness refinanced thereby, and (v) any such Indebtedness
shall not be secured by any Lien other than Liens on assets securing the
Indebtedness being refinanced thereby.
SECTION 6.02. Liens. (a) The Borrower will not, nor will it permit
------
any Restricted Subsidiary to, create, incur, assume or permit to exist any Lien
on any property or asset now owned or hereafter acquired by it, or assign or
sell any income or revenues (including accounts receivable) or rights in respect
of any thereof, except:
51
(i) Liens securing obligations under the Purchase Agreement or the
Purchase Money Credit Agreement;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of the Borrower or any
Restricted Subsidiary existing on the date hereof and set forth in Schedule
6.02; provided that (A) such Lien shall not apply to any other property or
--------
asset of the Borrower or any Restricted Subsidiary and (B) such Lien shall
secure only those obligations which it secures on the date hereof and
refinancings thereof that satisfy the criteria set forth in clause (g) of
Section 6.01;
(iv) any Lien existing on any property or asset prior to the date that
such property or asset was first acquired by the Borrower or any Subsidiary
or any Affiliate thereof or existing on any property or asset of any Person
that becomes a Subsidiary after the date hereof prior to the time such
Person becomes a Subsidiary; provided that (A) such Lien is not created in
--------
contemplation of or in connection with such acquisition or such Person
becoming a Subsidiary, (B) such Lien shall not apply to any other property
or assets of the Borrower or any Subsidiary and (C) such Lien shall secure
only those obligations which it secures on the date of such acquisition or
the date such Person becomes a Subsidiary, as the case may be, and
refinancings thereof that satisfy the criteria set forth in clause (g) of
Section 6.01;
(v) Liens on fixed or capital assets acquired, constructed or improved
by the Borrower or a Restricted Subsidiary; provided that (A) such Liens
--------
secure only Indebtedness permitted by clause (d) of Section 6.01 or a
refinancing thereof permitted by clause (g) of Section 6.01, (B) such Liens
and the Indebtedness secured thereby are incurred prior to or within 90
days after such acquisition or the completion of such construction or
improvement, (C) the Indebtedness secured thereby does not exceed 100% of
the cost of acquiring, constructing or improving such fixed or capital
assets and (D) such Liens shall not apply to any other property or assets
of the Borrower or any Restricted Subsidiary;
(vi) Liens existing under the Collateral Pledge and Security Agreement
dated as of February 6, 1997, between the Borrower and the Bank of New
York; provided that such Liens secure only Indebtedness in a principal
--------
52
amount not to exceed the principal amount secured under such agreement on
the date hereof and do not apply to any other property or assets of the
Borrower or any Restricted Subsidiary; and
(vii) other Liens on assets of the Borrower and the Restricted
Subsidiaries securing monetary obligations in an aggregate amount not
exceeding $1,000,000 at any time.
(b) Notwithstanding the foregoing, the Borrower will not, nor will
it permit any Restricted Subsidiary to, create any Lien (other than any
Permitted Encumbrance) on any FCC License or on any capital stock of or other
ownership interest in or Indebtedness of any License Subsidiary.
SECTION 6.03. Fundamental Changes. (a) The Borrower will not, nor
--------------------
will it permit any Restricted Subsidiary to, merge into or consolidate with any
other Person, or permit any other Person to merge into or consolidate with it,
or sell, transfer, lease or otherwise dispose of (in one transaction or in a
series of transactions) all or substantially all of its assets, or all or
substantially all of the stock of any of its Restricted Subsidiaries (in each
case, whether now owned or hereafter acquired), or liquidate or dissolve, except
that, if at the time thereof and immediately after giving effect thereto no
Default shall have occurred and be continuing (i) any Person may merge into the
Borrower or a Restricted Subsidiary (other than a License Subsidiary) pursuant
to a transaction that constitutes a Permitted Acquisition, provided that the
--------
survivor of such merger is the Borrower or a Restricted Subsidiary, as
applicable; (ii) any Restricted Subsidiary (other than a License Subsidiary) may
merge into any other Restricted Subsidiary (other than a License Subsidiary) in
a transaction in which the surviving entity is a Restricted Subsidiary, (iii)
any Restricted Subsidiary may sell, transfer, lease or otherwise dispose of its
assets to the Borrower or to another Restricted Subsidiary (other than a License
Subsidiary) or (iv) any Restricted Subsidiary may liquidate or dissolve if the
Borrower determines in good faith that such liquidation or dissolution is in its
best interests and is not materially disadvantageous to the Lenders; provided
--------
that any such merger involving the Borrower or any Person that is not a wholly
owned Restricted Subsidiary immediately prior to such merger shall not be
permitted unless also permitted by Section 6.04.
(b) The Borrower will not, nor will it permit any of its Restricted
Subsidiaries to, engage to any material
53
extent in any business other than telecommunications and data networking
business and businesses related thereto.
SECTION 6.04. Investments, Loans, Advances, Guarantees and
--------------------------------------------
Acquisitions; Asset Sales. (a) The Borrower will not, nor will it permit any
--------------------------
of its Restricted Subsidiaries to, purchase, hold or acquire (including pursuant
to any merger with any Person that was not a wholly owned Restricted Subsidiary
prior to such merger) any capital stock, evidences of indebtedness or other
securities (including any option, warrant or other right to acquire any of the
foregoing) of, make or permit to exist any loans or advances to, Guarantee any
obligations of, or make or permit to exist any investment or any other interest
in, any other Person, or purchase or otherwise acquire (in one transaction or a
series of transactions) any assets of any other Person constituting a business
unit, except:
(i) Permitted Investments;
(ii) subject to Section 6.12, investments by the Borrower and its
Restricted Subsidiaries in the capital stock of their respective Restricted
Subsidiaries; provided that the aggregate amount of outstanding investments
--------
made by the Borrower and its wholly owned Restricted Subsidiaries in, and
loans and advances made by the Borrower and its wholly owned Restricted
Subsidiaries to, Restricted Subsidiaries that are not wholly owned
Restricted Subsidiaries shall not exceed $5,000,000;
(iii) subject to Section 6.12, loans or advances made by the Borrower
to any Restricted Subsidiary and made by any Restricted Subsidiary to the
Borrower or any other Restricted Subsidiary; provided that the aggregate
--------
amount of such loans and advances made by the Borrower and its wholly owned
Restricted Subsidiaries to Restricted Subsidiaries that are not wholly
owned Restricted Subsidiaries shall be subject to the limitation set forth
in clause (ii) above;
(iv) Guarantees by the Borrower of obligations of the Restricted
Subsidiaries; provided that the aggregate amount of outstanding obligations
--------
Guaranteed by the Borrower of Restricted Subsidiaries that are not wholly
owned Restricted Subsidiaries shall be treated as investments in such
Restricted Subsidiaries for purposes of the limitation set forth in the
proviso to clause (ii) above;
(v) Permitted Acquisitions;
54
(vi) (A) promissory notes received by the Borrower or any Restricted
Subsidiary in connection with sales of assets (other than assets
constituting Collateral) permitted by paragraph (b) below and (B) the
common stock of Pentriad North America, Inc. ("Pentriad") received by the
--------
Borrower in connection with the sale of assets to Pentriad described on
Schedule 6.04;
(vii) investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(viii) (A) promissory notes of directors, officers or employees of the
Borrower or any Restricted Subsidiary issued to the Borrower in exchange
for common stock of the Borrower and (B) other loans and advances by the
Borrower or any Restricted Subsidiary to their respective directors,
officers or employees in an aggregate principal amount not exceeding
$1,000,000 at any one time outstanding; or
(ix) other investments by the Borrower or any of the Restricted
Subsidiaries (including (A) investments in Unrestricted Subsidiaries and
joint ventures and (B) investments in any Restricted Subsidiary existing at
the time such Subsidiary is designated as an Unrestricted Subsidiary) in an
aggregate amount not exceeding $3,000,000 at any one time outstanding.
(b) The Borrower will not, nor will it permit any of its Restricted
Subsidiaries to, sell, transfer, lease or otherwise dispose of any asset,
including any capital stock of or ownership interest in any other Person owned
by it, nor will the Borrower permit any Restricted Subsidiary to issue (other
than to the Borrower or a wholly owned Restricted Subsidiary) any additional
shares of its capital stock or other ownership interest in such Restricted
Subsidiary, except:
(i) sales of (A) inventory, (B) obsolete, uneconomic or surplus
assets not exceeding, in the aggregate, $1,000,000 during any fiscal year
of the Borrower and (C) Permitted Investments, in each case in the ordinary
course of business;
(ii) transfers constituting investments permitted by paragraph (a)
of this Section or Restricted Payments permitted by Section 6.06;
55
(iii) sales, transfers and dispositions to the Borrower or, subject
to Section 6.12, a Restricted Subsidiary;
(iv) other sales, transfers and dispositions of obsolete, uneconomic
or surplus assets made when no Default has occurred and is continuing;
(v) sales of assets not exceeding, in the aggregate, $10,000,000;
provided at least 85% of the consideration received for each such sale
--------
consists of cash;
(vii) dispositions of Telecommunications Assets in exchange for
comparable Telecommunications Assets; provided that the Board of Directors
--------
of the Borrower shall have approved such disposition and exchange and
determined the fair market value of the Telecommunications Assets subject
to such transaction as evidenced by a resolution of such Board; and
(viii) sales, transfers and dispositions of the assets set forth on
Schedule 6.04;
provided that all sales, transfers, leases and other dispositions permitted
--------
hereby (other than pursuant to clause (iii) above) shall be made for fair value.
SECTION 6.05. Hedging Agreements. The Borrower will not, nor will it
-------------------
permit any of its Restricted Subsidiaries to, enter into any Hedging Agreement,
other than Hedging Agreements required by the Purchase Money Credit Agreement
and other Hedging Agreements entered into in the ordinary course of business to
hedge or mitigate risks to which the Borrower or any Restricted Subsidiary is
exposed in the conduct of its business or the management of its liabilities.
SECTION 6.06. Restricted Payments. The Borrower will not, nor will
--------------------
it permit any Restricted Subsidiary to, declare or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, except (a) the Borrower
may declare and pay dividends with respect to its capital stock payable solely
in additional shares of its common stock or Permitted Preferred Stock, (b)
Restricted Subsidiaries may declare and pay dividends and distributions ratably
with respect to their common stock, and (c) the Borrower may make regularly
scheduled payments of principal of and interest on Subordinated Indebtedness as
and when due, subject to the subordination provisions thereof.
56
SECTION 6.07. Transactions with Affiliates. The Borrower will not,
-----------------------------
nor will it permit any Restricted Subsidiary to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any
of its Unrestricted Subsidiaries or other Affiliates, except (a) transactions
that are at prices and on terms and conditions not less favorable to the
Borrower or such Restricted Subsidiary than could be obtained on an arm's-length
basis from unrelated third parties, (b) transactions between or among the
Borrower and its wholly owned Restricted Subsidiaries not involving any other
Affiliate, (c) any Restricted Payment permitted by Section 6.06, (d)
transactions expressly contemplated by the Intercompany Agreements that are
conducted in accordance with the terms of the Intercompany Agreements and (e)
purchases by the Borrower from any Affiliate of equipment and services for the
Network at prices not exceeding the applicable Affiliate's cost therefor.
SECTION 6.08. Restrictive Agreements. The Borrower will not, and
-----------------------
will not permit any Restricted Subsidiary to, directly or indirectly, enter
into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon the ability of any Restricted
Subsidiary to pay dividends or other distributions with respect to any shares of
its capital stock or to make or repay loans or advances to the Borrower or to
Guarantee Indebtedness of the Borrower; provided that (a) the foregoing shall
--------
not apply to restrictions and conditions imposed by law or by any Loan Document
and (b) the foregoing shall not apply to restrictions and conditions existing on
the date hereof identified on Schedule 6.08 (but shall apply to any extension or
renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition).
SECTION 6.09. Repayment of Indebtedness. The Borrower will not, nor
--------------------------
will it permit any Restricted Subsidiary to, make any Repayment in respect of,
or make any payment in violation of any subordination terms of, any Indebtedness
of the Borrower or any Restricted Subsidiary except (a) Repayments of Loans and
Indebtedness under the Purchase Money Credit Agreement, (b) any Repayment of
Indebtedness to the extent such Repayment is refinanced by incurring Other Debt
or by incurring other Indebtedness that (i) has a scheduled maturity date that
is on or after the scheduled maturity date of the Indebtedness being refinanced,
(ii) has a weighted average life to maturity that is equal to or longer than the
remaining weighted
57
average life to maturity of the Indebtedness being refinanced, determined
immediately prior to giving effect to such Repayment, and (iii) does not include
any provisions that may require mandatory Repayment thereof prior to scheduled
maturity, other than scheduled repayments taken into consideration in
determining compliance with clause (ii) above and other provisions that are not
materially more burdensome than any such provisions included in the Indebtedness
being refinanced, or (c) any Repayment of Indebtedness at the scheduled final
maturity thereof or in accordance with regularly scheduled amortization
requirements prior to maturity.
SECTION 6.10. Intercompany Agreements. The Borrower will not, nor
------------------------
will it permit any Restricted Subsidiary to, enter into any material agreement
or arrangement after the date hereof that would constitute an Intercompany
Agreement without the prior written approval of the Required Lenders.
SECTION 6.11. Limitation on Sale-Leaseback Transactions. The
-----------------------------------------
Borrower will not, nor will it permit any Restricted Subsidiary to, enter into
any arrangement, directly or indirectly, whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
that it intends to use for substantially the same purpose or purposes as the
property sold or transferred, except for any such sale of any fixed or capital
asset that is made for cash consideration in an amount not less than the cost of
such fixed or capital asset and is consummated within 90 days after the Borrower
or such Restricted Subsidiary acquires or completes the construction of such
fixed or capital asset.
SECTION 6.12. Restricted Subsidiaries. The Borrower will not permit
------------------------
any substantial part of the assets (other than FCC Licenses owned by License
Subsidiaries) and operations of the Borrower and the Restricted Subsidiaries
taken as a whole to be owned or conducted by the Restricted Subsidiaries taken
as a whole. Without limiting the generality of the foregoing, the Borrower will
not:
(a) sell, transfer, lease or otherwise dispose of any asset that is
part of the Network to any Restricted Subsidiary;
(b) permit the consolidated assets (excluding FCC Licenses owned by
License Subsidiaries) of the Restricted Subsidiaries (determined in accordance
with GAAP) at any
58
time to exceed 15% of the consolidated assets of the Borrower and the Restricted
Subsidiaries (determined in accordance with GAAP) at such time;
(c) permit the consolidated operating revenues of the Restricted
Subsidiaries for any fiscal quarter of the Borrower to exceed 15% of the
consolidated operating revenues of the Borrower and the Restricted Subsidiaries
for such fiscal quarter;
(d) permit any Restricted Subsidiary to Guarantee any Indebtedness or
other obligation of the Borrower; or
(e) permit the aggregate principal amount of Indebtedness of the
Restricted Subsidiaries outstanding at any time (excluding Indebtedness owed to
the Borrower or to a Restricted Subsidiary and otherwise determined on a
consolidated basis in accordance with GAAP) to exceed $20,000,000.
SECTION 6.13. FCC Licenses and License Subsidiaries. The Borrower
--------------------------------------
will not permit any FCC License to be owned or acquired by any Person other than
the Borrower or a Restricted Subsidiary that (a) is wholly owned directly by the
Borrower, (b) does not engage in any business or activity other than the
ownership of one or more FCC Licenses and activities incidental thereto, (c)
does not own or acquire any assets other than one or more FCC Licenses, cash and
Permitted Investments and (d) does not have or incur any Indebtedness or other
liabilities other than liabilities imposed by law, including tax liabilities,
and other liabilities incidental to its existence and permitted business and
activities (any Restricted Subsidiary satisfying the foregoing requirements, a
"License Subsidiary"); provided that, to the extent the Borrower is advised by
------------------- --------
counsel that, in order to preserve the tax status of any tax-free reorganization
involving any Restricted Subsidiary (a "Tax-Free Merger Sub"), any FCC License
-------------------
cannot be held by the Borrower or a License Subsidiary, such FCC License shall
be held by such Tax-Free Merger Sub until such time as such FCC License may be
transferred to the Borrower or a License Subsidiary without adverse tax
consequences to the Borrower or the other parties to the transaction pursuant to
which such Tax-Free Merger Sub became a Subsidiary of the Borrower.
SECTION 6.14. ERISA. The Borrower will not permit the present value
------
of all accumulated benefit obligations under any Plan (based on the assumptions
used for purposes of Statement of Financial Accounting Standards
59
No. 87) to exceed the fair market value of the assets of such Plan.
SECTION 6.15. Minimum Revenues. The Borrower will not permit the
-----------------
consolidated revenue of the Borrower and the Restricted Subsidiaries for any
fiscal quarter ending on a date listed below to be less than the amount listed
opposite such date:
Date Amount
---- ------
September 30, 1998 $ 3,900
December 31, 1998 83,700
March 31, 1999 335,300
June 30, 1999 718,500
SECTION 6.15. Minimum Buildings on Network. The Borrower will not
-----------------------------
permit the number of buildings connected to the Network (i.e. buildings for
----
which the Borrower or a Restricted Subsidiary possesses roof rights, has
installed equipment and is capable of transmitting to a hub site) as of any date
listed below to be less than the number listed opposite such date:
Date Number
---- ------
September 30, 1998 14
December 31, 1998 81
March 31, 1999 142
June 30, 1999 190
SECTION 6.16. Minimum Customers. The Borrower will not permit the
------------------
number of customers of the Borrower and its Restricted Subsidiaries (treating
each office location of a Person purchasing services from the Borrower as a
separate customer to the extent such office locations are in separate buildings)
as of any date listed below to be less than the number listed opposite such
date:
Date Number
---- ------
September 30, 1998 16
December 31, 1998 116
March 31, 1999 342
June 30, 1999 620
60
ARTICLE VII
Events of Default
-----------------
If any of the following events ("Events of Default") shall occur:
-----------------
(a) the Borrower shall fail to pay any principal of any Loan when and
as the same shall become due and payable, whether at the due date thereof
or at a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
other amount (other than an amount referred to in clause (a) of this
Article) payable under this Agreement, when and as the same shall become
due and payable, and such failure shall continue unremedied for a period of
three Business Days;
(c) any representation or warranty made or deemed made by or on behalf
of the Borrower in or in connection with this Agreement or any amendment or
modification hereof or waiver hereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in
connection with this Agreement or any amendment or modification hereof or
waiver hereunder, shall prove to have been incorrect in any respect (or, in
the case of any representation or warranty that is not qualified as to
materiality, in any material respect) when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02, 5.03 (with respect to the
existence of the Borrower) or 5.09 or in Article VI;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof from
the Administrative Agent to the Borrower (which notice will be given at the
request of any Lender);
(f) any Loan Party shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness, when and as the same shall become due and payable and such
failure shall continue for more than any expressly applicable period of
grace with respect thereto
61
(without giving effect to any waiver, consent or amendment for which any
Loan Party gave any consideration or benefit of any kind (including any
increased compensation, prepayment, shortening of maturities, security or
other credit support) during the continuation of such failure or within 30
days before such failure would otherwise have occurred);
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables
or permits (or would enable or permit, but for a waiver, consent or
amendment for which any Loan Party gave any consideration or benefit of any
kind (including any increased compensation, prepayment, shortening of
maturities, security or other credit support) during the continuation of
such event or condition or within 30 days before such event or condition
would otherwise have occurred) the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to cause any
Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled
maturity; provided that this clause (g) shall not apply to secured
--------
Indebtedness that becomes due as a result of the voluntary sale or transfer
of the property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of any Loan Party or its debts, or of a substantial part
of its assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any Loan Party or for a substantial part of its
assets, and, in any such case, such proceeding or petition shall continue
undismissed for 60 days or an order or decree approving or ordering any of
the foregoing shall be entered;
(i) any Loan Party shall (i) voluntarily commence any proceeding or
file any petition seeking liquidation, reorganization or other relief under
any Federal, state or foreign bankruptcy, insolvency, receivership or
similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article,
62
(iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for any Loan Party
or for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors or (vi) take any
action for the purpose of effecting any of the foregoing;
(j) any Loan Party shall become unable, admit in writing its inability
or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $5,000,000 shall be rendered against any Loan Party or
any combination thereof and the same shall remain undischarged for a period
of 30 consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to
attach or levy upon any assets of any Loan Party to enforce any such
judgment;
(l) a Change in Control shall occur;
(m) the loss, revocation, suspension or material impairment of any
material FCC License shall occur; or
(n) an "Event of Default" (as defined in the Purchase Money Credit
Agreement) shall occur;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately, and
(ii) declare the Loans then outstanding to be due and payable in whole (or in
part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower; and
in case of any event with respect to the Borrower described in
63
clause (h) or (i) of this Article, the Commitments shall automatically terminate
and the principal of the Loans then outstanding, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall automatically become due and payable, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
------------------------
Each of the Lenders hereby irrevocably appoints the Administrative
Agent as its agent and authorizes the Administrative Agent to take such actions
on its behalf and to exercise such powers as are delegated to the Administrative
Agent by the terms of this Agreement, together with such actions and powers as
are reasonably incidental thereto.
Any Person serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and such
Person and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the Borrower or any Subsidiary or other
Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth in this Agreement. Without limiting the
generality of the foregoing, (a) the Administrative Agent shall not be subject
to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) the Administrative Agent shall not have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated by this Agreement
that the Administrative Agent is required to exercise in writing by the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 9.02), and (c) except as
expressly set forth in this Agreement, the Administrative Agent shall not have
any duty to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any of its Subsidiaries that is
communicated to or obtained by the Person serving as the Administrative Agent or
any of its Affiliates in any capacity. The Administrative Agent shall
64
not be liable for any action taken or not taken by it with the consent or at the
request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section
9.02) or in the absence of its own gross negligence or wilful misconduct. The
Administrative Agent shall be deemed not to have knowledge of any Default unless
and until written notice thereof is given to the Administrative Agent by the
Borrower or a Lender, and the Administrative Agent shall not be responsible for
or have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with this Agreement, (ii) the contents
of any certificate, report or other document delivered thereunder or in
connection herewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in this Agreement,
(iv) the validity, enforceability, effectiveness or genuineness of or any other
agreement, instrument or document, or (v) the satisfaction of any condition set
forth in Article IV or elsewhere in this Agreement, other than to confirm
receipt of items expressly required to be delivered to the Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
65
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right to appoint a successor.
If no successor shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent
may, on behalf of the Lenders, appoint a successor Administrative Agent which
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor, such successor shall succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. After the
Administrative Agent's resignation hereunder, the provisions of this Article and
Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was
acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement
or related agreement or any document furnished hereunder or thereunder.
66
ARTICLE IX
Miscellaneous
-------------
SECTION 9.01. Notices. Except in the case of notices and other
--------
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at ▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇., ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention of General Counsel (Telecopy No. (425) 990-
1642), with a copy of any notice of a Default to Ropes & ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇ ▇.
▇▇▇▇▇, Esq. (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇); and
(b) if to the Administrative Agent or any other Lender, to it at
Lucent Technologies Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
Attention of Assistant Treasurer-Project Finance (Telecopy No. (908) 559-
1711).
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
--------------------
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver
of any provision of this Agreement or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
67
given. Without limiting the generality of the foregoing, the making of a Loan
shall not be construed as a waiver of any Default, regardless of whether the
Administrative Agent or any Lender may have had notice or knowledge of such
Default at the time.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders; provided that no such
--------
agreement shall (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce the principal amount of any Loan or reduce
the rate of interest on such Loan, without the written consent of each Lender
affected thereby, (iii) postpone the scheduled date of payment of the principal
amount of any Loan or any interest thereon, or reduce the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby, (iv)
change Section 2.14(b) or (c) in a manner that would alter the pro rata sharing
of payments required thereby, without the written consent of each Lender, (v)
change any of the provisions of this Section or the definition of "Required
Lenders" or any other provision of any Loan Document specifying the number or
percentage of Lenders required to waive, amend or modify any rights thereunder
or make any determination or grant any consent thereunder, without the written
consent of each Lender or (vi) change any of the provisions of Section 2.09(g)
or Lucent's rights thereunder, or the form of any Warrant to be issued
thereunder, without the written consent of Lucent; provided further that no such
----------------
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent without the prior written consent of the Administrative
Agent.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
-----------------------------------
shall pay (i) all reasonable costs and expenses incurred by Lucent and the
Administrative Agent, including the reasonable fees, charges and disbursements
of counsel for Lucent or the Administrative Agent, in connection with the
preparation, execution and delivery of the Loan Documents (including, in the
case of Lucent, the Commitment Letter dated April 27, 1998, between Lucent and
the Borrower and the supplemental Commitment Letter dated July 17, 1998, between
Lucent and the Borrower); provided that the payment of such costs and expenses
--------
shall not be required prior to the earlier of the Effective Date and the
"Effective Date" (as defined in the Purchase Money Credit Agreement) and (ii)
all reasonable costs and expenses incurred by the Administrative Agent or any
Lender,
68
including the reasonable fees, charges and disbursements of any counsel for the
Administrative Agent or any Lender, in connection with (A) the enforcement or
protection of its rights in connection with this Agreement, including its rights
under this Section, or in connection with the Loans made hereunder, including
all such costs and expenses incurred during any workout, restructuring or
negotiations in respect of such Loans, and (B) in the case of Lucent and the
Administrative Agent, the administration of, and any amendments, modifications,
waivers or supplements of or to the provisions of, this Agreement.
(b) The Borrower shall indemnify the Administrative Agent and each
Lender, and each Related Party of any of the foregoing Persons (each such Person
being called an "Indemnitee") against, and hold each Indemnitee harmless from,
----------
any and all losses, claims, damages, liabilities and related expenses, including
the fees, charges and disbursements of any counsel for any Indemnitee, incurred
by or asserted against any Indemnitee arising out of, in connection with, or as
a result of (i) the execution or delivery of any Loan Document or any other
agreement or instrument contemplated hereby, the performance by the parties to
the Loan Documents of their respective obligations thereunder or the
consummation of the Transactions or any other transactions contemplated hereby,
(ii) any Loan or the use of the proceeds therefrom, (iii) any actual or alleged
presence or release of Hazardous Materials on or from any property owned or
operated by the Borrower or any of its Subsidiaries, or any Environmental
Liability related in any way to the Borrower or any of its Subsidiaries, or (iv)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; provided
--------
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses have resulted
from the gross negligence or wilful misconduct of such Indemnitee.
(c) To the extent that the Borrower fails to pay any amount required
to be paid by it to the Administrative Agent under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent such
Lender's pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the unreimbursed expense or indemnified loss, claim, damage,
--------
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent in
69
its capacity as such. For purposes hereof, a Lender's "pro rata share" shall be
determined based upon its share of the sum of the total outstanding Loans and
Commitments at the time.
(d) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable not later
than 30 days after written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
-----------------------
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Related Parties of the Administrative Agent and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) Any Lender may assign to one or more assignees all or a portion
of its rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans at the time owing to it); provided that (i)
--------
such assignment is a Permitted Assignment, (ii) each partial assignment shall be
made as an assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement, and (iii) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance. Subject to acceptance and recording thereof pursuant to
paragraph (d) of this Section, from and after the effective date specified in
each Assignment and Acceptance the assignee thereunder shall be a party hereto
and, to the extent of the interest assigned by such Assignment and Acceptance,
have the rights and obligations of a Lender under this Agreement, and the
assigning Lender thereunder
70
shall, to the extent of the interest assigned by such Assignment and Acceptance,
be released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of the assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a party hereto
but shall continue to be entitled to the benefits of Sections 2.11, 2.12, 2.13
and 9.03).
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of the
Loans owing to, each Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the Borrower,
--------
the Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee and any written consent to such
assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.
(e) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of
--------
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or assignee for such Lender as a party hereto.
SECTION 9.05. Survival. All covenants, agreements, representations
---------
and warranties made by the Borrower in this Agreement and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement
shall be considered to have been relied upon by
71
the other parties hereto and shall survive the execution and delivery of the
Loan Documents and the making of any Loans, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that the
Administrative Agent or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any other amount payable
under this Agreement is outstanding and unpaid and so long as the Commitments
have not expired or terminated. The provisions of Sections 2.11, 2.12, 2.13 and
9.03 and Article VIII shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Commitments or the
termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This
-----------------------------------------
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement
and the other Loan Documents constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held to
-------------
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
72
SECTION 9.08. Right of Setoff. If an Event of Default shall have
----------------
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
--------------------------------------------------
Process. (a) This Agreement shall be construed in accordance with and governed
--------
by the law of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to any
Loan Document, or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such Federal court. Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that the Administrative Agent or any Lender may
otherwise have to bring any action or proceeding relating to this Agreement
against the Borrower or its properties in the courts of any jurisdiction.
(c) The Borrower hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any court referred to
in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the
73
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
---------------------
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table
---------
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent and
----------------
the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or
74
obligations under this Agreement, (g) with the consent of the Borrower or (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section or (ii) becomes available to the
Administrative Agent or any Lender on a nonconfidential basis from a source
other than the Borrower. For the purposes of this Section, "Information" means
-----------
all information received from the Borrower relating to the Borrower or its
business, other than any such information that is publicly available or
available to the Administrative Agent or any Lender on a nonconfidential basis
prior to disclosure by the Borrower. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
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SECTION 9.13. Interest Rate Limitation. Notwithstanding anything
-------------------------
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
-------
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
------------
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
ADVANCED RADIO TELECOM CORP.,
by______________________________________
Name:
Title:
LUCENT TECHNOLOGIES INC.,
individually and as
Administrative Agent,
by______________________________________
Name:
Title:
Schedule 2.01
COMMITMENTS
-----------
Lender Commitment Amount
------ -----------------
Lucent Technologies Inc. $25,000,000
Schedule 5.09
KEY PRODUCTS
------------
PBX systems
Actual phone terminals