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EXHIBIT 23
LOAN AGREEMENT
BY AND AMONG
CELLNET DATA SERVICES (SL), INC.,
AS BORROWER,
TORONTO DOMINION (TEXAS), INC.,
AS ADMINISTRATIVE AGENT,
TD SECURITIES (USA), INC.,
AS LEAD ARRANGER AND SYNDICATION AGENT,
THE BANK OF NEW YORK,
AS CO-AGENT
AND
THE FINANCIAL INSTITUTIONS WHOSE NAMES
APPEAR AS LENDERS ON THE SIGNATURE PAGES HEREOF,
AS LENDERS
NOVEMBER 23, 1998
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TABLE OF CONTENTS
Page
ARTICLE 1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Section 2.1 The Loans . . . . . . . . . . . . . . . . . . . . . . . . . .14
Section 2.2 Manner of Borrowing and Disbursement. . . . . . . . . . . . .15
Section 2.3 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . .17
Section 2.4 Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
Section 2.5 Voluntary Prepayment. . . . . . . . . . . . . . . . . . . . .19
Section 2.6 Voluntary Reduction of the Commitment . . . . . . . . . . . .19
Section 2.7 Scheduled Reduction of Commitment . . . . . . . . . . . . . .20
Section 2.8 Mandatory Reduction of Commitment . . . . . . . . . . . . . .20
Section 2.9 Notes; Loan Accounts. . . . . . . . . . . . . . . . . . . . .21
Section 2.10 Manner of Payment . . . . . . . . . . . . . . . . . . . . . .21
Section 2.11 Reimbursement . . . . . . . . . . . . . . . . . . . . . . . .22
Section 2.12 Pro Rata Treatment. . . . . . . . . . . . . . . . . . . . . .22
Section 2.13 Capital Adequacy. . . . . . . . . . . . . . . . . . . . . . .23
Section 2.14 Lender Tax Forms. . . . . . . . . . . . . . . . . . . . . . .23
Section 2.15 Replacement Lender. . . . . . . . . . . . . . . . . . . . . .24
ARTICLE 3 Conditions Precedent. . . . . . . . . . . . . . . . . . . . . . .24
Section 3.1 Conditions Precedent to Initial Advance . . . . . . . . . . .24
Section 3.2 Conditions Precedent to Each Advance. . . . . . . . . . . . .27
ARTICLE 4 Representations and Warranties. . . . . . . . . . . . . . . . . .28
Section 4.1 Representations and Warranties. . . . . . . . . . . . . . . .28
Section 4.2 Survival of Representations and Warranties. . . . . . . . . .34
ARTICLE 5 Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . .35
Section 5.1 Preservation of Existence and Similar Matters . . . . . . . .35
Section 5.2 Business; Compliance with Applicable Law. . . . . . . . . . .35
Section 5.3 Maintenance of Properties . . . . . . . . . . . . . . . . . .35
Section 5.4 Accounting Methods and Financial Records. . . . . . . . . . .35
Section 5.5 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . .36
Section 5.6 Payment of Taxes and Claims . . . . . . . . . . . . . . . . .36
Section 5.7 Visits and Inspections. . . . . . . . . . . . . . . . . . . .36
Section 5.8 Payment of Indebtedness; Loans. . . . . . . . . . . . . . . .37
Section 5.9 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . .37
Section 5.10 Real Estate . . . . . . . . . . . . . . . . . . . . . . . . .37
Section 5.11 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . .37
Section 5.12 Interest Rate Hedging . . . . . . . . . . . . . . . . . . . .38
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Section 5.13 Covenants Regarding Formation of Subsidiaries and the
Making of Investments and Acquisitions. . . . . . . . . . . .38
Section 5.14 Payment of Wages. . . . . . . . . . . . . . . . . . . . . . .39
Section 5.15 Compliance with Contracts . . . . . . . . . . . . . . . . . .39
Section 5.16 Year 2000 Problem . . . . . . . . . . . . . . . . . . . . . .39
ARTICLE 6 Information Covenants . . . . . . . . . . . . . . . . . . . . . .39
Section 6.1 Quarterly Financial Statements and Information. . . . . . . .39
Section 6.2 Annual Financial Statements and Information . . . . . . . . .40
Section 6.3 Performance Certificates. . . . . . . . . . . . . . . . . . .40
Section 6.4 Copies of Other Reports . . . . . . . . . . . . . . . . . . .41
Section 6.5 Notice of Litigation and Other Matters. . . . . . . . . . . .41
ARTICLE 7 Negative Covenants. . . . . . . . . . . . . . . . . . . . . . . .42
Section 7.1 Indebtedness of the Borrower and its Subsidiaries . . . . . .42
Section 7.2 Limitation on Liens . . . . . . . . . . . . . . . . . . . . .43
Section 7.3 Amendment and Waiver. . . . . . . . . . . . . . . . . . . . .43
Section 7.4 Liquidation, Merger, Disposition of Assets. . . . . . . . . .43
Section 7.5 Limitation on Guaranties. . . . . . . . . . . . . . . . . . .44
Section 7.6 Investments and Acquisitions. . . . . . . . . . . . . . . . .44
Section 7.7 Restricted Payments and Purchases . . . . . . . . . . . . . .44
Section 7.8 Minimum Revenue . . . . . . . . . . . . . . . . . . . . . . .45
Section 7.9 Minimum Operating Cash Flow . . . . . . . . . . . . . . . . .46
Section 7.10 Capital Expenditures. . . . . . . . . . . . . . . . . . . . .46
Section 7.11 Leverage Ratio. . . . . . . . . . . . . . . . . . . . . . . .47
Section 7.12 Pro Forma Debt Service Ratio. . . . . . . . . . . . . . . . .47
Section 7.13 Interest Coverage Ratio . . . . . . . . . . . . . . . . . . .47
Section 7.14 Affiliate Transactions. . . . . . . . . . . . . . . . . . . .47
Section 7.15 Real Estate . . . . . . . . . . . . . . . . . . . . . . . . .48
Section 7.16 ERISA Liabilities . . . . . . . . . . . . . . . . . . . . . .48
ARTICLE 8 Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48
Section 8.1 Events of Default . . . . . . . . . . . . . . . . . . . . . .48
Section 8.2 Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . .50
Section 8.3 Payments Subsequent to Declaration of Event of Default. . . .51
ARTICLE 9 The Administrative Agent. . . . . . . . . . . . . . . . . . . . .52
Section 9.1 Appointment and Authorization . . . . . . . . . . . . . . . .52
Section 9.2 Interest Holders. . . . . . . . . . . . . . . . . . . . . . .52
Section 9.3 Consultation with Counsel . . . . . . . . . . . . . . . . . .52
Section 9.4 Documents . . . . . . . . . . . . . . . . . . . . . . . . . .52
Section 9.5 Administrative Agent and Affiliates . . . . . . . . . . . . .52
Section 9.6 Responsibility of the Administrative Agent. . . . . . . . . .53
Section 9.7 Security Documents. . . . . . . . . . . . . . . . . . . . . .53
Section 9.8 Action by the Administrative Agent. . . . . . . . . . . . . .53
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Section 9.9 Notice of Default or Event of Default . . . . . . . . . . . .53
Section 9.10 Responsibility Disclaimed . . . . . . . . . . . . . . . . . .54
Section 9.11 Indemnification . . . . . . . . . . . . . . . . . . . . . . .54
Section 9.12 Credit Decision . . . . . . . . . . . . . . . . . . . . . . .54
Section 9.13 Successor Administrative Agent. . . . . . . . . . . . . . . .55
Section 9.14 Delegation of Duties. . . . . . . . . . . . . . . . . . . . .55
Section 9.15 Administrative Agent May File Proofs of Claim . . . . . . . .55
ARTICLE 10 Change in Circumstances Affecting Eurodollar Advances. . . . . .56
Section 10.1 Eurodollar Basis Determination Inadequate or Unfair . . . . .56
Section 10.2 Illegality. . . . . . . . . . . . . . . . . . . . . . . . . .56
Section 10.3 Increased Costs . . . . . . . . . . . . . . . . . . . . . . .56
Section 10.4 Effect On Other Advances. . . . . . . . . . . . . . . . . . .57
ARTICLE 11 Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . .58
Section 11.1 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . .58
Section 11.2 Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . .59
Section 11.3 Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . .59
Section 11.4 Set-Off . . . . . . . . . . . . . . . . . . . . . . . . . . .60
Section 11.5 Assignment. . . . . . . . . . . . . . . . . . . . . . . . . .60
Section 11.6 Accounting Principles . . . . . . . . . . . . . . . . . . . .62
Section 11.7 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . .62
Section 11.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . .62
Section 11.9 Severability. . . . . . . . . . . . . . . . . . . . . . . . .62
Section 11.10 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . .62
Section 11.11 Table of Contents and Headings. . . . . . . . . . . . . . . .63
Section 11.12 Amendment and Waiver. . . . . . . . . . . . . . . . . . . . .63
Section 11.13 Entire Agreement. . . . . . . . . . . . . . . . . . . . . . .63
Section 11.14 Other Relationships . . . . . . . . . . . . . . . . . . . . .63
Section 11.15 Directly or Indirectly. . . . . . . . . . . . . . . . . . . .63
Section 11.16 Reliance on and Survival of Various Provisions. . . . . . . .64
Section 11.17 Confidentiality . . . . . . . . . . . . . . . . . . . . . . .64
ARTICLE 12 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . .64
Section 12.1 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . .64
iii
EXHIBITS
Exhibit A - Form of Assignment of Intercompany Agreements
Exhibit B - Form of Assignment of Utility Contract
Exhibit C - Form of Borrower's Pledge Agreement
Exhibit D - Omitted
Exhibit E - Form of Certificate of Financial Condition
Exhibit F - Form of Note
Exhibit G - Form of Performance Certificate
Exhibit H - Form of Request for Advance
Exhibit I - Form of Security Agreement
Exhibit J - Form of Subordination Agreement
Exhibit K - Form of Subsidiary Guaranty
Exhibit L - Form of Subsidiary Pledge Agreement
Exhibit M-1 - Form of Guarantying Subsidiary Security Agreement
Exhibit M-2 - Form of Non-Guarantying Subsidiary Security Agreement
Exhibit N - Form of Use of Proceeds Letter
Exhibit O - Form of Borrower's Loan Certificate
Exhibit P - Form of Subsidiary Loan Certificate
Exhibit Q - Form of Legal Opinion of General Counsel to Borrower
Exhibit R - Form of Legal Opinion of FCC Counsel to Borrower
Exhibit S - Form of Assignment and Assumption Agreement
SCHEDULES
Schedule 1 - Allocation of Commitment among the Lenders, Commitment
Ratios, and Lenders' Addresses for Notice
Schedule 2 - FCC Licenses, IOAs
Schedule 3 - Subsidiaries and Investments of the Borrower
Schedule 4 - Owned and Material Leased Real Property
Schedule 5 - Litigation
Schedule 6 - Agreements with Affiliates
Schedule 7 - Indebtedness for Money Borrowed of the Borrower and its
Subsidiaries
iv
LOAN AGREEMENT
by and among
CELLNET DATA SERVICES (SL), INC., as Borrower;
TORONTO DOMINION (TEXAS), INC., as Administrative Agent;
TD SECURITIES (USA), INC., as Lead Arranger and Syndication Agent;
THE BANK OF NEW YORK
as Co-Agent,
and
THE FINANCIAL INSTITUTIONS WHOSE NAMES
APPEAR AS LENDERS ON THE SIGNATURE PAGES HEREOF, as Lenders.
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged by each of the parties hereto, the parties agree
as follows as of the 23rd day of November, 1998:
ARTICLE 1
DEFINITIONS
For the purposes of this Agreement:
"ACQUISITION" shall mean (whether by purchase, exchange, issuance of
stock or other equity or debt securities, merger, reorganization or any other
method) (i) any acquisition by the Borrower or any of its Subsidiaries of any
other Person, which Person shall then become consolidated with the Borrower or
any such Subsidiary in accordance with GAAP, or (ii) any acquisition by the
Borrower or any of its Subsidiaries of all or any substantial amount of the
assets of any other Person. For purposes of the preceding sentence, an amount
of assets shall be deemed to be "substantial" if such assets have a fair market
value in excess of $1,000,000; provided, however, that the purchase of equipment
and other goods and services in the ordinary course of business shall not be
deemed to be "ACQUISITIONS."
"ACTIVE METER" shall mean an Installed Meter which is currently
operational.
"ADDITIONAL FACILITY INDEBTEDNESS" shall mean additional Indebtedness
for Money Borrowed (as to which no commitment has been issued by any Lender as
of the Agreement Date) in a principal amount not to exceed $25,000,000, incurred
by the Borrower in accordance with Section 2.1(b) of this Agreement.
"ADMINISTRATIVE AGENT" shall mean Toronto Dominion (Texas), Inc., as
Administrative Agent for the Lenders, together with any successor Administrative
Agent appointed pursuant to Section 9.13 hereunder.
"ADMINISTRATIVE AGENT'S OFFICE" shall mean the office of Toronto
Dominion (Texas), Inc., as Administrative Agent hereunder, located at ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, or such other office as may be
designated pursuant to the provisions of Section 11.1 of this Agreement.
"ADVANCE" shall mean the aggregate amount advanced by the Lenders to the
Borrower pursuant to Article 2 hereof on the occasion of any borrowing.
"AFFILIATE" shall mean, with respect to a Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
such first Person. For purposes of this definition, "control" when used with
respect to any Person includes, without limitation, the direct
1
or indirect beneficial ownership of more than ten percent (10%) of the voting
securities or voting equity of such Person, or the power to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise. Unless otherwise specified, "Affiliate" shall mean an Affiliate of
the Borrower.
"AGREEMENT" shall mean this Loan Agreement.
"AGREEMENT DATE" shall mean November 23, 1998.
"ANNUALIZED OPERATING CASH FLOW" shall mean, as of any calculation date,
the product of (i) Operating Cash Flow for the most recently completed fiscal
quarter for which financial statements are available, multiplied by (ii) four
(4).
"APPLICABLE LAW" shall mean, in respect of any Person, all provisions of
constitutions, statutes, rules, regulations and orders of governmental bodies or
regulatory agencies applicable to such Person, including, without limiting the
foregoing, the Licenses, the Communications Act and all Environmental Laws, and
all orders, decisions, judgments and decrees of all courts and arbitrators in
proceedings or actions to which the Person in question is a party or by which it
is bound.
"APPLICABLE MARGIN" shall mean the interest rate margin applicable to
Advances hereunder as determined in accordance with Section 2.3(f) hereof.
"ASSIGNMENT OF INTERCOMPANY AGREEMENTS" shall mean the Assignment of
Intercompany Agreements between the Borrower and the Administrative Agent,
pursuant to which the Borrower collaterally assigns its interests in the
Intercompany Agreements to the Administrative Agent to secure the Obligations.
Such agreement shall be substantially in the form of EXHIBIT A attached hereto.
"ASSIGNMENT OF UTILITY CONTRACT" shall mean the Assignment of Utility
Contract by Borrower between the Borrower and the Administrative Agent, pursuant
to which the Borrower collaterally assigns its interests in the Utility Contract
to the Administrative Agent to secure the Obligations. Such agreement shall be
substantially in the form of EXHIBIT B attached hereto.
"AUTHORIZED SIGNATORY" shall mean such senior officers and directors of
the Borrower as may be duly authorized and designated in writing by the Borrower
to execute documents, agreements and instruments on behalf of the Borrower.
"BASE RATE" shall mean, at any time, the higher of (a) the rate of
interest adopted by the Administrative Agent as the reference rate for the
determination of interest rates for loans of varying maturities in Dollars to
United States residents of varying degrees of creditworthiness and being quoted
at such time by The Toronto-Dominion Bank, New York Branch as its "base rate" or
"prime rate," or (b) the Federal Funds Rate plus one-half of one percent (1/2%).
The Base Rate is not necessarily the lowest rate of interest charged to
borrowers of the Administrative Agent or its Affiliates.
"BASE RATE ADVANCE" shall mean an Advance which the Borrower requests to
be made as a Base Rate Advance or is reborrowed as a Base Rate Advance, and
which bears interest at the Base Rate Basis, in accordance with the provisions
of Section 2.2 hereof, and which shall be in a principal amount of at least
$1,000,000 and in an integral multiple of $250,000.
"BASE RATE BASIS" shall mean a simple interest rate equal to the sum of
(i) the Base Rate and (ii) the Applicable Margin. The Base Rate Basis shall be
adjusted automatically as of the
2
opening of business on the effective date of each change in the Base Rate to
account for such change and shall also be changed to reflect adjustments in the
Applicable Margin.
"BORROWER" shall mean CellNet Data Services (SL), Inc., a Delaware
corporation.
"BORROWER'S PLEDGE AGREEMENT" shall mean that certain Borrower's Pledge
Agreement of even date between the Borrower and the Administrative Agent,
substantially in the form of EXHIBIT C attached hereto, as amended, supplemented
or otherwise modified from time to time, pursuant to which the Borrower shall
pledge to the Administrative Agent any stock owned by it.
"BUSINESS DAY" shall mean a day on which banks and foreign exchange
markets are open for the transaction of business required for this Agreement in
London, Houston, and New York, as relevant to the determination to be made or
the action to be taken.
"CALIFORNIA INVESTMENT" shall mean the Borrower's Investment into
CellNet California, which is evidenced by the Intercompany Agreements, for the
development and construction of a wireless data services system in California,
which Investment shall not exceed $15,000,000.
"CAPITAL EXPENDITURES" shall mean, in respect of any Person,
expenditures for the purchase of capital assets which are properly capitalized
in accordance with GAAP.
"CAPITALIZED LEASE OBLIGATION" shall mean that portion of any obligation
of a Person as lessee under a lease which is required to be capitalized on the
balance sheet of such lessee in accordance with GAAP.
"CASH INTEREST EXPENSE" shall mean, for any period, for the Borrower and
its Subsidiaries, on a consolidated basis, cash interest paid or accrued in
respect of Total Debt, together with fees paid or payable during such period and
associated therewith, all as determined in accordance with GAAP and shall also
include the interest component of payments for such period in respect of
Capitalized Lease Obligations.
"CELLNET" shall mean CellNet Data Systems, Inc., a Delaware corporation.
"CELLNET CALIFORNIA" shall mean Cell Net Data Services (CA) Inc., a
Delaware corporation.
"CELLNET SUBORDINATED DEBT" shall mean unsecured, subordinated debt
issued by the Borrower in favor of CellNet having a maturity date not earlier
than December 31, 2008 and having subordination provisions reviewed by and
approved by the Majority Lenders, which are contained in the Subordination
Agreement, and which provisions, among other things, (a) shall not include any
cross-default with respect to a Default or an Event of Default under this
Agreement, and (b) shall include, without limitation, (i) a prohibition on
interest or fee payments, scheduled amortization or voluntary prepayments prior
to repayment, in full, of all Obligations hereunder, except to the extent
specifically permitted in this Agreement, (ii) a prohibition on the exercise of
any remedies prior to repayment, in full, of all Obligations hereunder, and
(iii) a requirement that the Administrative Agent have all voting rights
otherwise exercisable by CellNet during any bankruptcy proceedings.
"CERTIFICATE OF FINANCIAL CONDITION" shall mean a certificate,
substantially in the form of EXHIBIT E attached hereto, signed by the chief
financial officer of the Borrower, together with any schedules, exhibits or
annexes appended thereto.
"CO-AGENT" shall mean The Bank of New York.
3
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"COLLATERAL" shall mean any property of any kind provided as collateral
for the Obligations under any of the Security Documents.
"COMMITMENT" shall mean the several obligations of the Lenders to
advance the sum of up to $60,000,000 to the Borrower on or after the Agreement
Date, in accordance with their respective Commitment Ratios, as provided under
the terms and conditions of this Agreement and as such amount may be reduced
from time to time in accordance with the provisions of this Agreement.
"COMMITMENT RATIOS" shall mean the percentages in which the Lenders are
severally bound to make Advances to the Borrower under the Commitment, which are
set forth (together with dollar amounts) on SCHEDULE 1 attached hereto as of the
Agreement Date.
"COMMUNICATIONS ACT" shall mean the Communications Act of 1934, and any
similar or successor federal statute, and the rules and regulations of the FCC
thereunder, all as amended and as the same may be in effect from time to time.
"DEBT SERVICE" shall mean, for any period, the amount of Cash Interest
Expense, together with scheduled principal repayments (excluding any repayments
made or required to be made in accordance with Section 2.8 hereof) in respect of
Indebtedness for Money Borrowed, of the Borrower and its Subsidiaries on a
consolidated basis. For purposes of this definition, "principal" shall include
the principal component of payments for such period in respect of Capitalized
Lease Obligations.
"DEFAULT" shall mean any Event of Default, and any of the events
specified in Section 8.1, regardless of whether there shall have occurred any
passage of time or giving of notice, or both, that would be necessary in order
to constitute such event an Event of Default.
"DEFAULT RATE" shall mean a simple per annum interest rate equal to, (a)
with respect to the outstanding principal, the sum of the otherwise applicable
Interest Rate Basis plus two percent (2%), and (b) with respect to all other
Obligations, the Base Rate Basis plus two percent (2%).
"DOLLARS" or "$" shall mean the basic unit of the lawful currency of the
United States of America.
"ENVIRONMENTAL LAWS" shall mean, with respect to any Person, all
applicable federal, state and local laws, statutes, rules, regulations and
ordinances, codes, common law, consent agreements to which such Person is a
party or by which it is bound, orders, decrees, judgments and injunctions
issued, promulgated, approved or entered thereunder affecting such Person or its
property and relating to public health, safety or the pollution or protection of
the environment, including, without limitation, those relating to releases,
discharges, emissions, spills, leaching, or disposals to, on, or in air, water,
land or ground water, to the withdrawal or use of ground water, to the use,
handling or disposal of polychlorinated biphenyls, asbestos or urea
formaldehyde, to the treatment, storage, disposal or management of hazardous
substances (including, without limitation, petroleum, crude oil or any fraction
thereof, or other hydrocarbons), pollutants or contaminants, to exposure to
toxic, hazardous or other controlled, prohibited, or regulated substances,
including, without limitation, any such provisions under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended (42
U.S.C. Section 9601 et seq.), or the Resource Conservation and Recovery Act of
1976, as amended (42 U.S.C. Section 6901 et seq.).
4
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as in effect from time to time.
"ERISA AFFILIATE" shall mean any Person, including a Subsidiary or an
Affiliate of the Borrower, that is a member of any group of organizations
(within the meaning of Code Sections 414(b), 414(c), 414(m), or 414(o)) of which
the Borrower is a member.
"EURODOLLAR ADVANCE" shall mean an Advance which the Borrower requests
to be made as a Eurodollar Advance or which is reborrowed as a Eurodollar
Advance, and which bears interest at the Eurodollar Basis, in accordance with
the provisions of Section 2.2 hereof, and which shall be in a principal amount
of at least $2,500,000 and in an integral multiple of $500,000.
"EURODOLLAR BASIS" shall mean a simple per annum interest rate equal to
the sum of (a) the quotient of (i) the Eurodollar Rate divided by (ii) one minus
the Eurodollar Reserve Percentage, stated as a decimal, plus (b) the Applicable
Margin. The Eurodollar Basis shall apply to Interest Periods of one (1), two
(2), three (3), and six (6) months, and, once determined, shall remain unchanged
during the applicable Interest Period, except for changes to reflect adjustments
in the Eurodollar Reserve Percentage and the Applicable Margin pursuant to
Section 2.3(f) hereof.
"EURODOLLAR RATE" shall mean, for any Interest Period, the interest rate
per annum (rounded upward to the nearest one-sixteenth of one percent (1/16%))
which appears on Telerate Page 3750 as of 11:00 a.m. (London time), or, if
unavailable, any generally accepted successor rate selected by the
Administrative Agent, two (2) Business Days before the first day of such
Interest Period, in an amount approximately equal to the principal amount of,
and for a length of time approximately equal to the Interest Period for, the
Eurodollar Advance sought by the Borrower.
"EURODOLLAR RESERVE PERCENTAGE" shall mean the percentage which is in
effect from time to time under Regulation D of the Board of Governors of the
Federal Reserve System, as such regulation may be amended from time to time, as
the maximum reserve requirement applicable with respect to Eurocurrency
liabilities (as that term is defined in Regulation D), whether or not any Lender
has any such Eurocurrency liabilities subject to such reserve requirement at
that time. The Eurodollar Basis for any Eurodollar Advance shall be adjusted as
of the effective date of any change in the Eurodollar Reserve Percentage.
"EVENT OF DEFAULT" shall mean any of the events specified in Section
8.1, provided that any requirement for notice or lapse of time or both has been
satisfied.
"EXCESS CASH FLOW" shall mean, with respect to the Borrower and its
Subsidiaries on a consolidated basis, as of the end of any period of four
consecutive fiscal quarters of the Borrower and based on the financial
statements required to be provided under Section 6.2 hereof, the remainder of
(a) Operating Cash Flow for such fiscal period minus (b) the sum of the
following items for such fiscal period: (i) Capital Expenditures; (ii) cash
income taxes paid; (iii) Debt Service; and (iv) permanent prepayments of the
Loans (accompanied by permanent reduction of the Commitment) pursuant to
Section 2.6 hereunder.
"EXCESS CASH FLOW COMMENCEMENT DATE" shall mean the last day of the
fourth fiscal quarter ending after the Implementation Phase.
"FCC" shall mean the Federal Communications Commission, or any other
similar or successor agency of the federal government administering the
Communications Act.
"FEDERAL FUNDS RATE" shall mean, as of any date, the weighted average of
the rates on overnight federal funds transactions with the members of the
Federal Reserve System arranged
5
by federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such transactions
received by the Administrative Agent or its Affiliate from three (3) federal
funds brokers of recognized standing selected by the Administrative Agent or its
Affiliate.
"FEE LETTERs" shall mean those certain agreements dated as of the
Agreement Date setting forth the applicable fees to be paid by the Borrower to
the other parties to this Agreement in connection with the Loans and Commitment
created hereunder.
"GAAP" shall mean generally accepted accounting principles in the United
States, consistently applied.
"GUARANTY" or "GUARANTEED," as applied to an obligation, shall mean and
include (a) a guaranty, direct or indirect, in any manner, of all or any part of
such obligation, and (b) any agreement, direct or indirect, contingent or
otherwise, the practical effect of which is to assure in any way the payment or
performance (or payment of damages in the event of non-performance) of all or
any part of such obligation, including, without limiting the foregoing, any
reimbursement obligations with respect to drawn or undrawn letters of credit.
"GUARANTYING SUBSIDIARY" means any Subsidiary of the Borrower which may
issue guaranties of the Obligations hereunder without conflicting with the terms
of the Indenture.
"GUARANTYING SUBSIDIARY SECURITY AGREEMENT" shall mean that certain
Guarantying Subsidiary Security Agreement of even date, between each of the
Borrower's Guarantying Subsidiaries, on the one hand, and the Administrative
Agent, on the other hand, substantially in the form of EXHIBIT M-1 attached
hereto, and shall include any supplement thereto executed by any such new
Guarantying Subsidiary.
"HAZARDOUS MATERIALS" shall mean any and all hazardous or toxic
substances, materials, or wastes, as defined or listed in Environmental Laws.
"IMPLEMENTATION PHASE" shall mean the period during which the Borrower
and CellNet are engaged in the design and construction of a wireless data
transmission system for Union Electric, which period shall be deemed to end for
purposes of this Agreement on December 31, 1999.
"INDEBTEDNESS" shall mean, with respect to any Person, and without
duplication, (a) all Indebtedness for Money Borrowed and all other items, except
items of partners' equity or capital stock or surplus or general contingency or
deferred tax reserves, which in accordance with GAAP would be included in
determining total liabilities as shown on the liability side of a balance sheet
of such Person, including, without limitation, secured non-recourse obligations
of such Person, valued at the lesser of the fair market value of the property
subject to the secured obligation or the amount of the Indebtedness so secured,
(b) all direct or indirect obligations of any other Person secured by any Lien
to which any property or asset owned by such Person is subject, but only to the
extent of the lower of (i) the face amount of such obligations or (ii) the
higher of the fair market value or the book value of the property or asset
subject to such Lien if the obligation secured thereby shall not have been
assumed, (c) all obligations of such Person with respect to leases constituting
part of a sale and lease-back arrangement, and (d) all reimbursement obligations
with respect to drawn or undrawn letters of credit; provided, however,
"Indebtedness" shall not include obligations of the Borrower or any Subsidiary
to the Borrower or any other Subsidiary.
6
"INDEBTEDNESS FOR MONEY BORROWED" shall mean, with respect to any
Person, Indebtedness for money borrowed and Indebtedness represented by notes
payable and drafts accepted representing extensions of credit, all obligations
evidenced by bonds, debentures, notes or other similar instruments, all
Indebtedness upon which interest charges are customarily paid, all Capitalized
Lease Obligations, all reimbursement obligations with respect to drawn or
undrawn letters of credit, all Indebtedness issued or assumed as full or partial
payment for property or services (other than trade payables arising in the
ordinary course of business, but only if and so long as such accounts are
payable on customary trade terms), whether or not any such notes, drafts,
obligations or Indebtedness represent Indebtedness for money borrowed, and,
without duplication, Guaranties of any of the foregoing, valued at the lesser of
the face amount of the Guaranty or the principal amount of the Indebtedness
guaranteed. For purposes of this definition, interest which is accrued but not
paid on the scheduled due date for such interest shall be deemed Indebtedness
for Money Borrowed.
"INDEMNITEE" shall have the meaning ascribed to it in Section 5.11
hereof.
"INDENTURE" means the Indenture dated as of June 15, 1995, as
supplemented through the date of this Agreement and as further supplemented from
time to time, by and between CellNet and The Bank of New York, as trustee,
provided such supplements are no more restrictive upon the Guarantying
Subsidiaries than the Indenture in effect on the Agreement Date.
"INSTALLED METER" shall mean any device for measuring and recording the
quantity or rate of flow of electricity or gas which has been installed by the
Borrower pursuant to the terms and conditions of the Utility Contract.
"INTERCOMPANY AGREEMENTS" shall mean all notes, loan agreements,
security agreements and other collateral documents by and between the Borrower
and CellNet California relating to and securing the California Investment, and
all other documents, instruments and agreements executed or delivered in
connection therewith.
"INTEREST HEDGE AGREEMENTS" shall mean any interest rate swap, cap,
collar, floor, caption or option agreements, or any similar arrangements
designed to hedge the risk of variable interest rate volatility or to reduce
interest costs, arising at any time between the Borrower, on the one hand, and
any one or more of the Lenders, or any other Person (other than an Affiliate of
the Borrower), on the other hand, as such agreement or arrangement may be
modified, supplemented and in effect from time to time.
"INTEREST PERIOD" shall mean (a) in connection with any Base Rate
Advance, the period beginning on the date such Advance is made and ending on the
last Business Day of the calendar quarter in which such Advance is made,
provided, however, that if a Base Rate Advance is made on the last day of any
calendar quarter, it shall have an Interest Period ending on, and its Payment
Date shall be, the last day of the following calendar quarter, and (b) in
connection with any Eurodollar Advance, the term of such Advance selected by the
Borrower or otherwise determined in accordance with this Agreement.
Notwithstanding the foregoing, however, (i) any applicable Interest Period which
would otherwise end on a day which is not a Business Day shall be extended to
the next succeeding Business Day unless, with respect to Eurodollar Advances
only, such Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Business Day, (ii) any
applicable Interest Period, with respect to Eurodollar Advances only, which
begins on a day for which there is no numerically corresponding day in the
calendar month during which such Interest Period is to end shall (subject to
clause (i) above) end on the last day of such calendar month, and (iii) no
Interest Period shall extend beyond the Maturity Date or such earlier date as
would interfere with the
7
Borrower's repayment obligations hereunder. Interest shall be due and payable
with respect to any Advance as provided in Section 2.3 hereof.
"INTEREST RATE BASIS" shall mean the Base Rate Basis or the Eurodollar
Basis as appropriate.
"INVESTMENT" shall mean, with respect to any Person, any loan, advance
or extension of credit (other than to customers in the ordinary course of
business) by such Person to, or any Guaranty or other contingent liability with
respect to the capital stock, Indebtedness or other obligations of, or any
contributions to the capital of, any other Person, or any ownership, purchase or
other acquisition by such Person of any interest in any capital stock, limited
partnership interest, general partnership interest, or other securities of any
such other Person, other than an Acquisition. "INVESTMENT" shall also include
the total cost of any future commitment or other obligation binding on any
Person to make an Investment or any subsequent Investment.
"IOA" shall mean any Interim Operations Authorization issued to the
Borrower or any of its Subsidiaries by the FCC, listed as of the Agreement Date
on SCHEDULE 2 hereto.
"LENDERS" shall mean the financial institutions whose names appear as
"Lenders" on the signature pages hereof and any other Person which becomes a
"Lender" hereunder after the Agreement Date; and "Lender" shall mean any one of
the foregoing Lenders.
"LEVERAGE RATIO" shall mean, as of any calculation date, the ratio of
Total Debt to Annualized Operating Cash Flow.
"LICENSES" shall mean any radio, cellular, microwave, paging or wireless
communications service license, or any other license, authorization, certificate
of compliance, franchise, approval or permit, other than any IOA, for the
construction or the operation of any System of the Borrower, granted or issued
by the FCC and held by the Borrower or any of its Subsidiaries, or by any Person
in which the Borrower or any of its Subsidiaries has an Investment, all of which
are listed (together with IOAs so designated) as of the Agreement Date on
SCHEDULE 2 hereto. "LICENSES" shall also include the rights, under Applicable
Law, of the Borrower to use otherwise unlicensed spectrum as used by the
Borrower in the ordinary course of business as of the Agreement Date.
"LIEN" shall mean, with respect to any property, any mortgage, lien,
pledge, negative pledge or other agreement not to pledge, assignment, charge,
security interest, title retention agreement, levy, execution, seizure,
attachment, garnishment or other similar encumbrance of any kind in respect of
such property, whether created by statute, contract, the common law or
otherwise, and whether or not ▇▇▇▇▇▇, vested or perfected.
"LOAN DOCUMENTS" shall mean this Agreement, the Notes, the Security
Documents, the Subordination Agreement, the Fee Letters, all Requests for
Advance, all Interest Hedge Agreements between the Borrower, on the one hand,
and the Administrative Agent and the Lenders, or any of them, on the other hand,
and all other instruments and agreements executed or delivered in connection
with or contemplated by this Agreement.
"LOANS" shall mean, collectively, the amounts advanced from time to time
by the Lenders under this Agreement, not to exceed in aggregate principal amount
the amount of the Commitment, and evidenced by the Notes.
"MAJORITY LENDERS" shall mean (i) at any time that there exists no
Default hereunder, Lenders the total of whose Commitment Ratios equals or
exceeds fifty-one percent (51%), or (ii) at any time that there exists a Default
hereunder, Lenders the total of whose Loans outstanding equals or
8
exceeds fifty-one percent (51%) of the total principal amount of the Loans then
outstanding hereunder.
"MATERIALLY ADVERSE EFFECT" shall mean (i) any material adverse effect
upon the business, assets, liabilities, financial condition, results of
operations or properties of the Borrower and its Subsidiaries taken as a whole,
or (ii) any adverse effect upon the binding nature, validity, or enforceability
of this Agreement or the Notes, or upon the rights, benefits or interests of the
Lenders in and to the Loans or the rights of the Administrative Agent and the
Lenders in the Collateral, or (iii) any material and adverse effect upon the
ability of the Borrower and its Subsidiaries taken as a whole to perform the
payment obligations or other obligations under this Agreement or any other Loan
Document, or upon the value of the Collateral; in any such case, whether
resulting from any single act, omission, situation, status, event or
undertaking, or taken together with other such acts, omissions, situations,
statuses, events or undertakings.
"MATURITY DATE" shall mean the earlier of (a) December 31, 2007, or (b)
such earlier date on which the payment of all outstanding Obligations shall be
due (whether by acceleration or otherwise).
"MORTGAGE" shall mean any mortgage, deed to secure debt, deed of trust,
or other instrument encumbering or transferring title (in fee simple or
leasehold) to real property, in form and substance satisfactory to the
Administrative Agent, by which the Borrower or any Subsidiary grants a mortgage
to the Administrative Agent, as agent for the Lenders, or by which any
Subsidiary grants a mortgage to the Borrower which the Borrower collaterally
assigns to the Administrative Agent, as agent for the Lenders, on Property owned
or leased by the Borrower or any Subsidiary to secure repayment of the
Obligations.
"MULTIEMPLOYER PLAN" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"NECESSARY AUTHORIZATIONS" shall mean all approvals and licenses from,
and all filings and registrations with, any governmental or other regulatory
authority, including, without limiting the foregoing, the Licenses and all
grants, approvals, licenses, filings and registrations under the Communications
Act, necessary in order to enable the Borrower or any of its Subsidiaries to
own, construct, maintain and operate its Systems and to make and hold
Investments in other Persons who own, construct, maintain, and operate Systems.
"NET INCOME" shall mean, for the Borrower and its Subsidiaries on a
consolidated basis, for any period, net income determined in accordance with
GAAP.
"NET PROCEEDS" shall mean, with respect to any Permitted Asset Sale,
lease, transfer or other disposition of assets by the Borrower or any of its
Subsidiaries, the aggregate amount of cash received for such assets (including,
without limitation, any payments received for non-competition covenants,
consulting or management fees, and any portion of the amount received evidenced
by a buyer promissory note or other evidence of Indebtedness), net of reasonable
and customary transaction costs properly attributable to such transaction and
payable by the Borrower or any of its Subsidiaries (other than to an Affiliate)
in connection with such sale, lease, transfer or other disposition of assets.
"NON-GUARANTYING SUBSIDIARY" shall mean any Subsidiary of the Borrower
which is not a Guarantying Subsidiary.
"NON-GUARANTING SUBSIDIARY SECURITY AGREEMENT" shall mean that certain
non-Guarantying Subsidiary Security Agreement of even date, between each of the
Borrower's Non-Guarantying Subsidiaries, on the one hand, and the Borrower, on
the other hand, substantially in the form of
9
EXHIBIT M-2 attached hereto, and shall include any supplement thereto executed
by any such new Non-Guarantying Subsidiary.
"NOTES" shall mean those certain promissory notes in the aggregate
original principal amount of $60,000,000, one issued by the Borrower to each of
the Lenders, each one substantially in the form of EXHIBIT F attached hereto,
and any extensions, modifications, renewals or replacements of or amendments to
any of the foregoing.
"OBLIGATIONS" shall mean (i) all payment and performance obligations of
every kind, nature and description of the Borrower, its Subsidiaries, and any
other obligors to the Lenders, the Administrative Agent, or any of them, under
this Agreement and the other Loan Documents (including any interest, fees and
other charges on the Loans or otherwise under the Loan Documents that would
accrue but for the filing of a bankruptcy action with respect to the Borrower,
any such Subsidiary, or any such other obligor, whether or not such claim is
allowed in such bankruptcy action), as they may be amended from time to time, or
as a result of making the Loans, whether such obligations are direct or
indirect, absolute or contingent, due or not due, contractual or tortious,
liquidated or unliquidated, arising by operation of law or otherwise, now
existing or hereafter arising, and (ii) the obligation to pay an amount equal to
the amount of any and all damage which the Lenders, the Administrative Agent, or
any of them, may suffer by reason of a breach by the Borrower, any of its
Subsidiaries, or any other obligor, of any obligation, covenant or undertaking
with respect to this Agreement or any other Loan Document.
"OPERATING CASH FLOW" shall mean, for any fiscal quarter, for the
Borrower and its Subsidiaries on a consolidated basis, Net Income for such
quarter (after eliminating any extraordinary gains and losses, including gains
and losses from the sale of assets, and minority interests, and equity in
earnings (losses) of non-consolidated entities), plus, to the extent deducted or
accrued in determining Net Income, the sum of each of the following for such
quarter: (i) depreciation, amortization, and other non-cash charges, (ii)
income tax expense, including reserves for deferred items not paid during such
quarter, (iii) interest expense, (iv) transaction costs associated with entering
into the Loan Documents on the Agreement Date, and (v) transaction costs
associated with any Permitted Asset Sale or any Acquisition permitted by Section
7.4(a) or Section 7.6 hereunder; PROVIDED, HOWEVER, for the fiscal quarter
ending September 30, 1998, Net Income hereunder shall exclude up to $700,000 of
one-time property tax adjustments.
"PAYMENT DATE" shall mean the last day of any Interest Period.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PERFORMANCE CERTIFICATE" shall mean a certificate of an Authorized
Signatory of the Borrower as to its financial performance, in substantially the
form attached hereto as EXHIBIT G.
"PERFORMANCE TESTS" shall mean the financial covenants set forth in
Section 7.8 and 7.9 hereof.
"PERMITTED ASSET SALE" shall mean the sale by the Borrower or any of its
Subsidiaries of its or their assets as and to the extent permitted under Section
7.4(a) hereof.
"PERMITTED DEBT" shall mean Indebtedness for Money Borrowed permitted to
be incurred and to remain outstanding by the Borrower and its Subsidiaries,
pursuant to Section 7.1 hereof.
10
"PERMITTED INVESTMENTS" shall mean Investments described in and
permitted to be made under Section 7.6 hereof.
"PERMITTED LIENS" shall mean, as applied to any Person:
(a) Any Lien in favor of the Administrative Agent (for itself
and for the ratable benefit of the Lenders) given to secure the Obligations;
(b) (i) Liens on real estate for real estate taxes not yet
delinquent and (ii) Liens for taxes, assessments, judgments (to the extent
payment in full (subject to a customary deductible) is not covered by insurance
maintained with responsible insurance companies), governmental charges or levies
or claims the non-payment of which is being diligently contested in good faith
by appropriate proceedings and for which adequate reserves have been set aside
on such Person's books, but only so long as no foreclosure, distraint, sale or
similar proceedings have been commenced with respect thereto and remain unstayed
for a period of thirty (30) days after their commencement;
(c) Liens of landlords, carriers, warehousemen, mechanics,
laborers and materialmen incurred in the ordinary course of business for sums
not yet due or being diligently contested in good faith, if reserves or
appropriate provisions shall have been made therefor;
(d) Liens incurred in the ordinary course of business in
connection with worker's compensation and unemployment insurance;
(e) Restrictions on the transfer of assets imposed by any of
the Licenses as now in effect or by the Communications Act, any state laws, and
any rules and regulations thereunder;
(f) Easements, rights-of-way, restrictions and other similar
encumbrances on the use of real property which do not interfere with the
ordinary conduct of the business of such Person, or Liens incidental to the
conduct of the business of such Person or to the ownership of its properties
which were not incurred in connection with Indebtedness or other extensions of
credit and which do not in the aggregate materially detract from the value of
such properties or materially impair their use in the operation of the business
of such Person;
(g) Purchase money security interests, which (i) are
perfected automatically by operation of law, only for the period and limited to
Liens on assets so purchased (and directly-related assets, including proceeds,
replacements and products thereof and accessions and modifications thereto), or
(ii) are permitted pursuant to Section 7.1(d) hereof;
(h) Liens reflected by Uniform Commercial Code financing
statements filed in respect of Capitalized Lease Obligations permitted hereunder
and true leases or other precautionary or notice filings securing obligations
not otherwise constituting Indebtedness;
(i) Leases or subleases and licenses granted to others in the
ordinary course of business, not interfering in any material respect with the
business of the Borrower and its Subsidiaries taken as a whole, and any interest
or title of a lessor, licensor or under any lease or license;
(j) Liens on assets (including the proceeds thereof and
accessions thereto) that existed at the time such assets were acquired by the
Borrower or any Subsidiary (including Liens on assets of any corporation that
existed at the time it became or becomes a Subsidiary); provided, that such
Liens are not granted in contemplation of or in connection with the
11
acquisition of such assets by the Borrower and that the Indebtedness secured by
such Lien is permitted hereunder;
(k) Liens consisting of rights of set-off of a customary
nature or bankers' liens on amounts on deposit, whether arising by contract or
operation of law, incurred in the ordinary course of business; and
(l) Liens incurred in connection with the extension, renewal
or refinancing of the indebtedness secured by the Liens of the type described in
clauses (a), (g), (j) and (l); provided, that any extension, renewal or
replacement Lien shall be limited to the Property or asset encumbered by the
existing Lien and the principal amount of the Indebtedness being extended,
renewed or refinanced does not increase.
"PERSON" shall mean an individual, corporation, limited liability
company, association, partnership, joint venture, trust or estate, an
unincorporated organization, a government or any agency or political subdivision
thereof, or any other entity.
"PLAN" shall mean, with respect to any Person, an employee benefit plan
within the meaning of Section 3(3) of ERISA or any other employee benefit plan
maintained for employees of such Person.
"PRO FORMA DEBT SERVICE" shall mean projected Debt Service for the
Borrower and its Subsidiaries on a consolidated basis with respect to the next
succeeding fiscal four-quarter period following the calculation date, and after
giving effect to any Interest Hedge Agreements and all Eurodollar Advances. For
purposes of this definition, (i) it shall be assumed that the principal amount
of Indebtedness for Money Borrowed with respect to which Debt Service is being
calculated shall begin at the level outstanding on the calculation date and be
adjusted to reflect projected borrowings and repayments as indicated by the
Borrower's annual budget required to be delivered pursuant to Section 6.4(e)
hereof, and (ii) where interest payments on Indebtedness for Money Borrowed for
the fiscal four-quarter period immediately succeeding the calculation date are
not fixed by way of Interest Hedge Agreements for the entire period, interest
shall be calculated on such Indebtedness for Money Borrowed for periods for
which interest payments are not so fixed at the lower of (y) the Base Rate Basis
on the calculation date, or (z) the Eurodollar Basis which would be in effect on
the calculation date for a Eurodollar Advance having a six-month Interest
Period.
"PROPERTY" shall mean any real property or personal property, plant,
building, facility, structure, underground storage tank or unit, equipment,
inventory or other asset owned, leased or operated by Borrower or any Subsidiary
(including, without limitation, any surface water thereon or adjacent thereto,
and soil and groundwater thereunder).
"REMAINING EXCESS CASH FLOW" shall have the meaning set forth in Section
7.7(a) hereof.
"REPORTABLE EVENT" shall have the meaning set forth in Title IV of
ERISA.
"REQUEST FOR ADVANCE" shall mean a certificate designated as a "Request
for Advance," signed by an Authorized Signatory requesting an Advance hereunder,
which shall be in substantially the form of EXHIBIT H attached hereto and shall,
among other things, (i) specify the date of the Advance, which shall be a
Business Day, the amount of the Advance, the type of Advance, and, with respect
to a Eurodollar Advance, the Interest Period selected by the Borrower, (ii)
state that there shall not exist, on the date of the requested Advance both
before and after giving effect thereto, a Default, and (iii) as to an Advance
which will increase the
12
principal amount of the Loans then outstanding, specify the use of the proceeds
of the Advance being requested.
"RESTRICTED PAYMENT" shall mean (i) any direct or indirect distribution,
dividend or other cash payment by the Borrower or any of its Subsidiaries to any
Person (other than to the Borrower or any other Subsidiary of the Borrower) on
account of any general or limited partnership interest in, or ownership of any
shares of capital stock or other equity securities of, the Borrower or any of
its Subsidiaries; (ii) any payment in respect of CellNet Subordinated Debt; or
(iii) any payment by the Borrower or any of its Subsidiaries to a Person other
than the Borrower or any of its Subsidiaries under any management or consulting
agreement or other similar agreement or arrangement not entered into in the
ordinary course of business.
"RESTRICTED PURCHASE" shall mean any payment by the Borrower or any of
its Subsidiaries on account of the purchase, redemption or other acquisition or
retirement of any general or limited partnership interest in, or shares of
capital stock or other securities of, the Borrower or any of the Borrower's
Subsidiaries including, without limitation, any warrants or other rights or
options to acquire shares of capital stock or partnership interests of the
Borrower or any of the Borrower's Subsidiaries.
"SECURITY AGREEMENT" shall mean that certain Security Agreement of even
date between the Borrower and the Administrative Agent, substantially in the
form of EXHIBIT I attached hereto.
"SECURITY DOCUMENTS" shall mean the Borrower's Pledge Agreement, any
Subsidiary Pledge Agreement, the Security Agreement, any Guarantying Subsidiary
Security Agreement, any Non-Guarantying Subsidiary Security Agreement, any
Subsidiary Guaranty, any Mortgage, the Assignment of Intercompany Agreements,
the Assignment of Utility Contract, any other agreement or instrument providing
collateral for the Obligations whether now or hereafter in existence, and any
filings, instruments, agreements, and documents related thereto or to this
Agreement, and providing the Administrative Agent, for itself and for the
ratable benefit of the Lenders, with Collateral for the Obligations.
"SECURITY INTEREST" shall mean all Liens in favor of the Administrative
Agent, for itself and for the ratable benefit of the Lenders, created hereunder
or under any of the Security Documents to secure the Obligations.
"SUBORDINATION AGREEMENT" shall mean that certain Subordination
Agreement of even date among the Borrower, CellNet and the Administrative Agent,
providing for the subordination of the CellNet Subordinated Debt to the
Obligations, in substantially the form of EXHIBIT J attached hereto.
"SUBSIDIARY" shall mean, as applied to any Person, (a) any corporation
of which more than fifty percent (50%) of the outstanding stock (other than
directors' qualifying shares) having ordinary voting power to elect its board of
directors, regardless of the existence at the time of a right of the holders of
any class or classes of securities of such corporation to exercise such voting
power by reason of the happening of any contingency, or any partnership of which
more than fifty percent (50%) of the outstanding partnership interests, is at
the time owned directly or indirectly by such Person, or by one or more
Subsidiaries of such Person, or by such Person and one or more Subsidiaries of
such Person, or (b) any other entity which is directly or indirectly controlled,
or capable of being controlled through special or other voting rights, by such
Person, or by one or more Subsidiaries of such Person, or by such Person and one
or more Subsidiaries of such Person. "Subsidiaries" as used herein, unless
otherwise indicated, shall mean all Subsidiaries of the Borrower. The
Subsidiaries of the Borrower as of the Agreement Date are set forth on
SCHEDULE 3 attached hereto.
13
"SUBSIDIARY GUARANTY" shall mean that certain Subsidiary Guaranty of
even date between each Guarantying Subsidiary of the Borrower, on the one hand,
and the Administrative Agent, on the other hand, substantially in the form of
EXHIBIT K attached hereto, and shall include any supplement thereto executed by
any such new Guarantying Subsidiary.
"SUBSIDIARY PLEDGE AGREEMENT" shall mean any Subsidiary Pledge Agreement
between any Guarantying Subsidiary of the Borrower having one or more of its own
corporate Subsidiaries, on the one hand, and the Administrative Agent, on the
other hand, substantially in the form of EXHIBIT L attached hereto, and shall
include any supplement thereto executed by any such new Guarantying Subsidiary
having one or more of its own corporate Subsidiaries.
"SYSTEM" shall mean the wireless data transmission systems designed,
built and operated by the Borrower.
"TOTAL DEBT" shall mean, for the Borrower and the Subsidiaries of the
Borrower on a consolidated basis, as of any calculation date, and without
duplication, the sum of (a) the principal amount of the Loans outstanding, and
(b) the aggregate principal amount of all other Indebtedness for Money Borrowed
other than CellNet Subordinated Debt.
"UNION ELECTRIC" shall mean Union Electric Company, a Missouri
corporation, d/b/a AmerenUE.
"UNION ELECTRIC CONTRACT" shall mean that certain Utility Services
Agreement dated as of August 31, 1995, between the Borrower and Union Electric,
as same may be amended, supplemented or otherwise modified from time to time.
"USE OF PROCEEDS LETTER" shall mean that certain Use of Proceeds Letter,
substantially in the form of EXHIBIT N attached hereto, delivered to the
Administrative Agent and the Lenders on the Agreement Date pursuant to Article 3
hereof.
"UTILITY CONTRACT" shall mean the Union Electric Contract.
"YEAR 2000 PROBLEM" shall mean the risk that computer hardware or
computer applications used by the Borrower or any of its Subsidiaries (or their
suppliers, vendors and customers) may be unable to recognize and perform
properly date-sensitive functions involving certain dates on or prior to and any
date after December 31, 1999.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Each definition of an agreement or instrument in this Article 1 shall
include such agreement or instrument as amended from time to time in accordance
herewith.
ARTICLE 2
LOANS
Section 2.1 THE LOANS.
(a) REDUCING REVOLVING LOANS. The Lenders agree, severally in
accordance with their respective Commitment Ratios and not jointly, upon the
terms and subject to the conditions of this Agreement, to lend and re-lend to
the Borrower, on and after the Agreement Date, amounts requested by the Borrower
which, in the aggregate, do not exceed at any time the amount of the
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Commitment. Advances under the Commitment may be repaid and reborrowed as
provided in Section 2.2 hereof in order to reborrow Eurodollar Advances for new
Interest Periods or to otherwise effect changes in the Interest Rate Bases
applicable to the Advances hereunder. Any unpaid principal and interest of the
Loans and any other outstanding Obligations shall be due and payable in full on
the Maturity Date.
(b) ADDITIONAL FACILITY INDEBTEDNESS. The Borrower may also borrow
up to $25,000,000 in aggregate principal amount of Additional Facility
Indebtedness, subject to the following conditions: (i) the Additional Facility
Indebtedness shall be acceptable to the Majority Lenders and incurred on terms
and conditions no more favorable to the Borrower than the terms and conditions
of the Loans and shall have a final maturity no earlier than the Maturity Date;
(ii) each Lender hereunder shall be offered the opportunity (but shall not be
obliged) to issue a commitment for its PRO RATA share of such Additional
Facility Indebtedness or, in the event that any Lender elects not to participate
or to issue a Commitment for less than its PRO RATA share, in an amount
increased to reflect the difference; and (iii) the Additional Facility
Indebtedness shall constitute Obligations hereunder and shall rank PARI PASSU
with the other Obligations.
Section 2.2 MANNER OF BORROWING AND DISBURSEMENT.
(a) CHOICE OF INTEREST RATE. Any Advance under the Commitment shall,
at the option of the Borrower, be made as a Base Rate Advance or a Eurodollar
Advance; provided, however, that at such time as there shall have occurred and
be continuing a Default hereunder, the Borrower shall not have the right to
borrow or to re-borrow any Eurodollar Advances, and all subsequent Advances
shall be made as Base Rate Advances. Any notice given to the Administrative
Agent in connection with a requested Advance hereunder shall be given to the
Administrative Agent prior to 11:00 a.m. (Houston time) in order for such
Business Day to count toward the minimum number of Business Days required.
(b) BASE RATE ADVANCES.
(i) INITIAL ADVANCES. The Borrower shall give the
Administrative Agent in the case of Base Rate Advances at least one (1)
Business Day's irrevocable prior written notice in the form of a Request
for Advance, or telephonic notice followed immediately by a Request for
Advance; provided, however, that the Borrower's failure to confirm any
telephonic notice with a Request for Advance shall not invalidate any
notice so given.
(ii) PREPAYMENTS AND CONVERSIONS. Upon at least one (1), with
respect to item (B) of this sentence, or three (3), with respect to item
(A) of this sentence, Business Days' irrevocable prior written notice
(or telephonic notice followed immediately by written notice) to the
Administrative Agent, and subject to the provisions of
Section 2.2(c)(iii), the Borrower may (A) convert all or a portion of
the principal of a Base Rate Advance to one or more Eurodollar Advances,
or (B) prepay all or any portion of such Base Rate Advance. On the date
indicated by the Borrower, such Base Rate Advance shall be so repaid or,
as applicable, converted. Advances prepaid or repaid (and not converted
or rolled over at such time) under the Commitment may be reborrowed and
will not permanently reduce the Commitment unless otherwise specified in
accordance with Section 2.6 hereof.
(c) EURODOLLAR ADVANCES.
(i) INITIAL ADVANCES. The Borrower shall give the
Administrative Agent in the case of Eurodollar Advances at least three
(3) Business Days' irrevocable prior written notice in the form of a
Request for Advance, or telephonic notice followed immediately by a
Request for Advance; provided, however, that the Borrower's failure to
confirm any
15
telephonic notice with a Request for Advance shall not invalidate any
notice so given. The Administrative Agent shall determine the available
Eurodollar Bases and shall notify the Borrower of such Eurodollar Bases.
The Borrower shall promptly notify the Administrative Agent by telephone
or telecopy, and shall immediately confirm any such telephonic notice in
writing, of its selection of a Eurodollar Basis and Interest Period for
such Advance; provided, however, that the Borrower's failure to confirm
any such telephonic notice in writing shall not invalidate any notice so
given.
(ii) PREPAYMENTS AND CONVERSIONS. At least three (3) Business
Days prior to each Payment Date for a Eurodollar Advance, the Borrower
shall give the Administrative Agent written notice specifying whether
all or a portion of any Eurodollar Advance outstanding on the Payment
Date (A) is to be rolled over as another Eurodollar Advance, (B) is to
be converted to a Base Rate Advance, or (C) is to be repaid. Eurodollar
Advances may be prepaid prior to the applicable Payment Date upon at
least three (3) Business Days prior written notice (or telephonic notice
followed immediately by written notice) to the Administrative Agent as
set forth in Section 2.5 hereof. Upon such Payment Date such Eurodollar
Advance will, subject to the provisions hereof, be so rolled over,
repaid or, as applicable, converted. Advances prepaid or repaid (and
not converted or rolled over at such time) under the Commitment may be
reborrowed and will not permanently reduce the Commitment unless
otherwise specified in accordance with Section 2.6 hereof.
(iii) MAXIMUM EURODOLLAR ADVANCES. At no time may the number
of outstanding Eurodollar Advances exceed five (5).
(d) NOTIFICATION OF LENDERS. Upon receipt of a Request for Advance,
or a notice from the Borrower with respect to a selection of an Interest Period,
or a notice from the Borrower with respect to any outstanding Advance prior to
the Payment Date for such Advance, the Administrative Agent shall promptly
notify each Lender by telephone or telecopy of the contents thereof and the
amount of such Lender's portion of the Advance. Each Lender shall, not later
than 1:30 p.m. (Houston time) on the date of borrowing specified in such notice,
make available to the Administrative Agent at the Administrative Agent's Office,
or at such account as the Administrative Agent shall designate, the amount of
its portion of any Advance which represents an additional borrowing hereunder in
immediately available funds.
(e) DISBURSEMENT.
(i) Prior to 3:00 p.m. (Houston time) on the date of an
Advance hereunder, the Administrative Agent shall, subject to the
satisfaction of the conditions set forth in Article 3 hereof, disburse
the amounts made available to it by the Lenders in like funds by (A)
transferring the amounts so made available by wire transfer pursuant to
the Borrower's instructions, or (B) in the absence of such instructions,
crediting the amounts so made available to the account of the Borrower
maintained with the Administrative Agent.
(ii) Unless the Administrative Agent shall have received
notice from a Lender prior to 2:00 p.m. (Houston time) on the date of
any Advance that such Lender will not make available to the
Administrative Agent such Lender's ratable portion of such Advance, the
Administrative Agent may assume that such Lender has made or will make
such portion available to the Administrative Agent on the date of such
Advance and the Administrative Agent may in its sole discretion and in
reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent the Lender does not
make such ratable portion available to the Administrative Agent, such
Lender agrees to repay to the Administrative Agent on demand such
corresponding amount together with interest thereon, for each day from
the date such amount is made available to the Borrower until the
16
date such amount is repaid to the Administrative Agent, at the Federal
Funds Rate for the first three (3) days and thereafter at the Federal
Funds Rate plus one percent (1%).
(iii) If such Lender shall repay to the Administrative Agent
such corresponding amount, such amount so repaid shall constitute such
Lender's portion of the applicable Advance for purposes of this
Agreement. If such Lender does not repay such corresponding amount
immediately upon the Administrative Agent's demand therefor, the
Administrative Agent shall notify the Borrower and the Borrower shall
immediately pay such corresponding amount to the Administrative Agent,
together with interest thereon. The failure of any Lender to fund its
portion of any Advance shall not relieve any other Lender of its
obligation hereunder to fund its respective portion of the Advance on
the date of such borrowing, but no Lender shall be responsible for any
such failure of any other Lender.
(iv) In the event that, at any time when the Borrower is not
in Default and has satisfied all applicable conditions set forth in
Article 3 hereof, a Lender for any reason fails or refuses to fund its
portion of an Advance, then, until such time as such Lender has funded
its portion of such Advance, or all other Lenders have received payment
in full (whether by repayment or prepayment) of the principal and
interest due in respect of such Advance, such non-funding Lender shall
not have the right (A) to vote regarding any issue on which voting is
required or advisable under this Agreement or any other Loan Document
(other than issues requiring the affirmative vote of all Lenders
pursuant to Section 11.12 hereof) and the amount of the Loan or
Commitment held by such Lender shall not be counted as outstanding for
purposes of determining "Majority Lenders" hereunder, and (B) to receive
payments of principal, interest or fees from the Borrower.
Section 2.3 INTEREST.
(a) ON BASE RATE ADVANCES. Interest on each Base Rate Advance shall
be computed on the basis of a year of 365/366 days for the actual number of days
elapsed and shall be payable at the Base Rate Basis for such Advance, in arrears
on the applicable Payment Date for the period through the date immediately
preceding such Payment Date. Interest on Base Rate Advances then outstanding
shall also be due and payable on the Maturity Date.
(b) ON EURODOLLAR ADVANCES. Interest on each Eurodollar Advance
shall be computed on the basis of a 360-day year for the actual number of days
elapsed and shall be payable at the Eurodollar Basis for such Advance, in
arrears on the applicable Payment Date for the period through the day
immediately preceding such Payment Date, and in addition, if the Interest Period
for a Eurodollar Advance exceeds three (3) months, interest on such Eurodollar
Advance shall also be due and payable in arrears on every three-month
anniversary of the beginning of such Interest Period. If a Eurodollar Advance or
portion thereof is terminated prior to the expiration of the applicable Interest
Period, interest on such Eurodollar Advance or portion thereof shall also be due
and payable in arrears on such termination date. Interest on Eurodollar Advances
then outstanding shall also be due and payable on the Maturity Date.
(c) INTEREST IF NO NOTICE OF SELECTION OF INTEREST RATE BASIS. If
the Borrower fails to give the Administrative Agent timely notice of its
selection of a Eurodollar Basis, or if for any reason the appropriate Eurodollar
Basis for any Advance is not determined, the Base Rate Basis shall apply to such
Advance.
(d) INTEREST UPON DEFAULT. Immediately upon the occurrence of an
Event of Default hereunder, the outstanding principal balance of the Loans,
together with accrued and unpaid interest and all other unpaid sums, shall bear
interest at the Default Rate. Such interest shall be payable on demand and
shall accrue until the earlier of (i) cure or waiver in writing of the
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applicable Event of Default in accordance with Section 11.12 hereof, or (ii)
agreement by the Majority Lenders to rescind the charging of interest at the
Default Rate.
(e) COMPUTATION OF INTEREST. In computing interest on any Advance,
the date of making the Advance shall be included and the date of payment shall
be excluded; provided, however, that if an Advance is repaid on the date that it
is made, one (1) day's interest shall be due.
(f) APPLICABLE MARGIN.
(i) With respect to any Advance under the Commitment
outstanding during the Implementation Phase, the Applicable Margin shall
be, as of any calculation date, 2.000% with respect to Base Rate
Advances and 3.000% with respect to Eurodollar Advances.
(ii) With respect to any Advance under the Commitment
outstanding after the Implementation Phase, the Applicable Margin shall
be, as of any calculation date, the interest rate margin determined by
the Administrative Agent based upon the Leverage Ratio determined for
the most recent fiscal quarter end, effective as of the second Business
Day after the financial statements referred to in Section 6.1 hereof are
delivered by the Borrower to the Administrative Agent and each Lender
for the fiscal quarter most recently ended, expressed as a per annum
rate of interest as follows:
-----------------------------------------------------------------------------------------------------------
Then the Base Rate Advance And the Eurodollar Advance
If the Leverage Ratio is: Applicable Margin is: Applicable Margin is:
-----------------------------------------------------------------------------------------------------------
Greater than or equal to 7.00 1.875% 2.875%
-----------------------------------------------------------------------------------------------------------
Greater than or equal to 6.00 but less than 7.00 1.750% 2.750%
-----------------------------------------------------------------------------------------------------------
Greater than or equal to 5.00 but less than 6.00 1.500% 2.500%
-----------------------------------------------------------------------------------------------------------
Greater than or equal to 4.00 but less than 5.00 1.250% 2.250%
-----------------------------------------------------------------------------------------------------------
Greater than or equal to 3.00 but less than 4.00 1.000% 2.000%
-----------------------------------------------------------------------------------------------------------
Less than 3.00 0.500% 1.500%
-----------------------------------------------------------------------------------------------------------
In the event that the Borrower fails to timely provide the financial statements
referred to above in accordance with the terms of Section 6.1 hereof or the
Performance Certificate referred to in Section 6.3 hereof, and without prejudice
to any additional rights under Section 2.3(d) or Section 8.2 hereof, until the
second Business Day after such financial statements are delivered, the
Applicable Margin shall be 1.50% for Base Rate Advances and 2.50% for Eurodollar
Advances.
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Section 2.4 FEES.
(a) FEES PAYABLE UNDER THE FEE LETTERS. The Borrower agrees to pay
to the Administrative Agent, for the benefit of the Administrative Agent and the
Lenders, as their respective interests may appear, such fees as are mutually
agreed upon and as are described in the Fee Letters.
(b) COMMITMENT FEE. In addition to the fees described in Section
2.4(a), the Borrower agrees to pay to the Administrative Agent, for the benefit
of each of the Lenders in accordance with their respective Commitment Ratios, a
commitment fee on the aggregate unborrowed balance of the Commitment, for each
day from the Agreement Date until the Maturity Date, at a rate (i) during the
Implementation Phase, of 0.500% per annum, and (ii) after the Implementation
Phase, as determined by the Administrative Agent based upon the Leverage Ratio
determined for the most recent fiscal quarter end, payable as of the second
Business Day after the financial statements referred to in Section 6.1 hereof
are delivered by the Borrower to the Administrative Agent and each Lender for
the fiscal quarter most recently ended, and equal to (x) in the event the
Leverage Ratio shall be greater than or equal to 7.00:1, 0.500% per annum, and
(y) in the event the Leverage Ratio shall be less than 7.00:1, 0.375% per annum.
In the event that the Borrower fails to timely provide (A) the financial
statements referred to above in accordance with the terms of Section 6.1 hereof
or (B) the Performance Certificate referred to in Section 6.3 hereof, and
without prejudice to any additional rights under Section 2.3(d) or Section 8.2
hereof, the commitment fee shall be 0.500% per annum until the actual delivery
of such statements. Such commitment fee shall be computed on the basis of a
year of 365/366 days for the actual number of days elapsed, shall be payable
quarterly in arrears on the last Business Day of each calendar quarter
commencing on December 31, 1998 and on the Maturity Date, shall be fully earned
when due, and shall be non-refundable when paid.
Section 2.5 VOLUNTARY PREPAYMENT. The principal amount of any Base
Rate Advance may be prepaid in full or in part at any time upon one (1) Business
Days' prior written notice to the Administrative Agent, without penalty or
premium; and the principal amount of any Eurodollar Advance may be prepaid
without penalty or premium prior to the applicable Payment Date, upon three (3)
Business Days' prior written notice to the Administrative Agent, provided that
Borrower shall reimburse any Lender for any loss or reasonable out-of-pocket
expense incurred by such Lender in connection with such prepayment, as set forth
in Section 2.11 hereof. Each notice of prepayment shall be irrevocable. Upon
receipt of any notice of prepayment, the Administrative Agent shall promptly
notify each Lender of the contents thereof by telephone or telecopy and of such
Lender's portion of the prepayment. Prepayments of principal hereunder in
respect of Base Rate Advances, shall be in minimum amounts of $1,000,000 and
integral multiples of $250,000, and prepayments of principal hereunder in
respect of Eurodollar Advances shall be in minimum amounts of $1,000,000 and
integral multiples of $500,000. Advances prepaid pursuant to this Section 2.5
may be reborrowed.
Section 2.6 VOLUNTARY REDUCTION OF THE COMMITMENT. The Borrower shall
have the right, on three (3) Business Days' irrevocable notice to the
Administrative Agent, to cancel all or a portion of the Commitment, on a pro
rata basis among the Lenders, provided that (a) any such cancellation shall be
made in a principal amount of not less than $5,000,000, and in an integral
multiple of $1,000,000; (b) as of the effective date of such notice, the
Commitment shall be permanently reduced to the amount stated in the Borrower's
notice for all purposes herein; and (c) on or prior to the effective date of
such notice, the Borrower shall pay to the Administrative
19
Agent for the benefit of the Lenders the amount necessary to reduce the
principal amount of the then outstanding Loans to not more than the amount of
the Commitment as so reduced, together with the accrued interest on the amount
so prepaid and the commitment fee set forth in Section 2.4 accrued through the
date of the reduction with respect to the amount reduced, and shall reimburse
the Administrative Agent and the Lenders for any loss or reasonable
out-of-pocket expense incurred by any of them in connection with such payment,
as set forth in Section 2.11. Each such reduction shall permanently reduce the
amount of the Commitment and shall reduce the dollar amount of each subsequent
scheduled quarterly Commitment reduction under Section 2.7 hereof on a weighted
pro rata basis.
Section 2.7 SCHEDULED REDUCTION OF COMMITMENT. The Commitment shall be
permanently reduced commencing on December 31, 2001 and at the end of each
calendar quarter thereafter, in quarterly installments, based upon the quarterly
commitment reductions as follows:
Calendar Quarters Ending Quarterly Commitment Reduction
------------------------ ------------------------------
December 31, 2001 through September 30, 2002 $ 1,125,000
December 31, 2002 through September 30, 2003 $ 1,500,000
December 31, 2003 through September 30, 2005 $ 2,250,000
December 31, 2005 through September 30, 2006 $ 3,000,000
December 31, 2006 through September 30, 2007 $ 3,750,000
December 31, 2007 $ 4,500,000
On the date of each such Commitment reduction, the Borrower shall pay to the
Administrative Agent for the benefit of the Lenders the amount necessary to
reduce the principal amount of the then outstanding Loans to not more than the
amount of the Commitment as so reduced, together with the accrued interest on
the amount so prepaid and the commitment fee set forth in Section 2.4 accrued
through the date of the reduction with respect to the amount reduced, and shall
reimburse the Administrative Agent and the Lenders for any loss or reasonable
out-of-pocket expense incurred by any of them in connection with such payment,
as set forth in Section 2.11.
Section 2.8 MANDATORY REDUCTION OF COMMITMENT. In addition to the
scheduled repayments and Commitment reductions provided for in Section 2.7
hereof, the Commitment shall be reduced and the Borrower shall, if required
pursuant to Section 2.8(c) hereof, prepay the Loans, without penalty or premium,
as follows:
(a) EXCESS CASH FLOW. On or prior to the 45th day after the end of
each fiscal quarter ending after the Excess Cash Flow Commencement Date, the
Commitment shall be reduced by an amount equal to twelve and one-half percent
(12 1/2%) of the Excess Cash Flow for the four fiscal quarter period
most-recently ended.
(b) PERMITTED ASSET SALES. If the Borrower or any Subsidiary shall,
to the extent permitted hereunder, consummate any Permitted Asset Sale, the
Commitment shall be reduced
20
by an amount equal to one hundred percent (100%) of the Net Proceeds received by
the Borrower or such Subsidiary, as the case may be, from such Permitted Asset
Sale on the date of receipt of the proceeds thereof by the Borrower or such
Subsidiary.
(c) APPLICATION. Mandatory reductions pursuant to this Section 2.8
shall permanently reduce the Commitment, and shall reduce the dollar amount of
each subsequent scheduled quarterly Commitment reduction under Section 2.7
hereof. As of the date of each reduction of the Commitment as set forth above,
the Borrower shall pay to the Administrative Agent for the benefit of the
Lenders the amount, if any, necessary to reduce the principal amount of the
Loans then outstanding to not more than the amount of the Commitment as so
reduced, together with accrued interest on the amount so prepaid and the
commitment fee set forth in Section 2.4 accrued through the date of the
reduction with respect to the amount reduced.
Section 2.9 NOTES; LOAN ACCOUNTS.
(a) The Loans shall be repayable in accordance with the terms and
provisions set forth herein and shall be evidenced by the Notes. One Note shall
be payable to the order of each Lender. The Notes shall be issued by the
Borrower to the Lenders and shall be duly executed and delivered by one or more
Authorized Signatories.
(b) Each Lender may open and maintain on its books in the name of the
Borrower a loan account with respect to such Lender's portion of the Loans and
interest thereon. Each Lender which opens such a loan account shall debit such
loan account for the principal amount of its portion of each Advance made and
accrued interest thereon and shall credit such loan account for each payment on
account of principal of or interest on its Loan. The records of a Lender with
respect to the loan account maintained by it shall be prima facie evidence of
the Loans and accrued interest thereon, absent manifest error, but the failure
of any Lender to make any such notations or any error or mistake in such
notations shall not affect the Borrower's repayment obligations with respect to
the Loans.
Section 2.10 MANNER OF PAYMENT.
(a) Each payment (including any prepayment) by the Borrower on
account of the principal of or interest on the Loans, commitment fees and any
other amount owed to the Lenders, the Administrative Agent or any of them under
this Agreement or the Notes shall be made not later than 2:00 p.m. (Houston
time) on the date specified for payment under this Agreement to the
Administrative Agent at the Administrative Agent's Office, for the account of
the Lenders, or the Administrative Agent, as the case may be, in Dollars in
immediately available funds. Any payment received by the Administrative Agent
after 2:00 p.m. (Houston time) shall be deemed received on the next Business
Day. Receipt by the Administrative Agent of any payment hereunder at or prior
to 2:00 p.m. (Houston time) on any Business Day shall be deemed to constitute
receipt on such Business Day. In the case of a payment for the account of a
Lender, the Administrative Agent will promptly thereafter (and, if such amount
is received before 2:00 p.m. (Houston time), on the same day) distribute the
amount so received in like funds to such Lender. If the Administrative Agent
shall not have received any payment from the Borrower as and when due, the
Administrative Agent will promptly notify the Lenders accordingly.
21
(b) The Borrower agrees to pay principal, interest, fees and all
other Obligations due hereunder, under the Fee Letters, under the Notes, or
under the other Loan Documents without set-off or counterclaim or any deduction
whatsoever.
(c) Prior to the acceleration of the Loans under Section 8.2 hereof,
if some but less than all amounts due from the Borrower are received by the
Administrative Agent with respect to the Obligations, the Administrative Agent
shall distribute such amounts in the following order of priority, all on a pro
rata basis to the Lenders where applicable: (i) to the payment on a pro rata
basis of any fees or expenses then due and payable to the Administrative Agent,
the Lenders, or any of them; (ii) to the payment of interest then due and
payable on the Loans; (iii) to the payment of all other amounts not otherwise
referred to in this Section 2.10(c) then due and payable to the Administrative
Agent or the Lenders, or any of them, hereunder or under the Notes; and (iv) to
the payment of principal then due and payable on the Notes.
(d) Subject to any contrary provisions in the definition of Interest
Period, if any payment under this Agreement or any of the other Loan Documents
is specified to be made on a day which is not a Business Day, it shall be made
on the next Business Day, and such extension of time shall in such case be
included in computing interest and fees, if any, in connection with such
payment.
Section 2.11 REIMBURSEMENT.
(a) Whenever any Lender shall sustain or incur any losses or
out-of-pocket expenses, as described in Section 2.11(b), in connection with
(i) failure by the Borrower to borrow any Eurodollar Advance after having given
notice of its intention to borrow in accordance with Section 2.2 hereof (whether
by reason of the Borrower's election not to proceed or the non-fulfillment of
any of the conditions set forth in Article 3), or (ii) prepayment of any
Eurodollar Advance in whole or in part for any reason (except for reasons
contemplated by Section 10.2 hereof which are applicable only to a single
Lender), the Borrower agrees to pay to such Lender, upon demand, an amount
sufficient to compensate such Lender for all such losses and reasonable
out-of-pocket expenses. Such Lender's good faith determination of the amount of
such losses or out-of-pocket expenses, as set forth in writing and accompanied
by calculations in reasonable detail demonstrating the basis for its demand,
shall be presumptively correct.
(b) Losses and out-of-pocket expenses subject to reimbursement
hereunder shall be (i) any loss incurred by any Lender in connection with the
re-employment of funds prepaid, repaid, not borrowed, or paid, as the case may
be, and the amount of such loss shall be the excess, if any, of (A) the interest
or other cost to such Lender of the deposit or other source of funding used to
make any such Eurodollar Advance for the remainder of its Interest Period, over
(B) the interest earned (or to be earned) by such Lender upon the re-lending or
other redeployment of the amount of such Eurodollar Advance for the remainder of
its putative Interest Period, and (ii) any other expenses incurred by any Lender
or any participant of such Lender permitted hereunder in connection with the
re-employment of funds prepaid, repaid, not borrowed, or paid, as the case may
be.
Section 2.12 PRO RATA TREATMENT.
(a) ADVANCES. Each Advance from the Lenders shall be made pro rata
on the basis of the respective Commitment Ratios of the Lenders.
22
(b) PAYMENTS. Except as provided in Section 2.2(e)(iv), Section
2.10(c), Section 8.3, or Article 10 hereof, each payment and prepayment of
principal of the Loans, and each payment of interest on the Loans, shall be made
to the Administrative Agent by the Borrower, and shall be distributed by the
Administrative Agent to the Lenders, on a pro rata basis in respect of their
respective unpaid principal amounts outstanding immediately prior to such
payment or prepayment. If any Lender shall obtain any payment (whether
involuntary, through the exercise of any right of set-off, or otherwise) on
account of the Loans made by it in excess of its ratable share of the Loans
under its Commitment Ratio, such Lender shall forthwith purchase from the other
Lenders such participations in the Loans made by them as shall be necessary to
cause such purchasing Lender to share the excess payment ratably with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and each such Lender shall repay to the purchasing Lender the
purchase price to the extent of such recovery. The Borrower agrees that any
Lender so purchasing a participation from another Lender pursuant to this
Section 2.12(b) may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
Section 2.13 CAPITAL ADEQUACY. If, after the date hereof, the adoption
of any Applicable Law regarding the capital adequacy of banks or bank holding
companies, or any change in Applicable Law (whether adopted before or after the
Agreement Date) or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Lender with any
directive issued or adopted after the date hereof regarding capital adequacy
(whether or not having the force of law) of any such governmental authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on any Lender's capital as a consequence of its obligations
hereunder with respect to the Loans and the Commitment to a level below that
which it could have achieved but for such adoption, change or compliance taking
into consideration such Lender's policies with respect to capital adequacy
immediately before such adoption, change or compliance and assuming that such
Lender's capital was fully utilized prior to such adoption, change or compliance
by an amount reasonably deemed by such Lender to be material, then such Lender
shall promptly notify the Borrower of such adoption, compliance, or change.
Upon demand by such Lender made within one hundred eighty (180) days of such
adoption, compliance or change, the Borrower shall promptly pay to such Lender
such additional amounts as shall be sufficient to compensate such Lender for
such reduced return, together with interest on such amount from the date of
demand until payment in full thereof at the Default Rate. A certificate of such
Lender setting forth the amount to be paid to such Lender by the Borrower as a
result of any event referred to in this paragraph and supporting calculations in
reasonable detail shall be presumptively correct.
Section 2.14 LENDER TAX FORMS. On or prior to the first Payment Date
hereunder and on or prior to the first Business Day of each calendar year
thereafter, each Lender which is organized in a jurisdiction other than the
United States or a political subdivision thereof shall provide each of the
Administrative Agent and the Borrower with two (2) properly executed originals
of Form 4224 or Form 1001 (or any successor forms) prescribed by the Internal
Revenue Service or other documents satisfactory to the Borrower and the
Administrative Agent, and properly executed Internal Revenue Service Form W-8 or
Form W-9, as the case may be, certifying (a) as to such Lender's status for
purposes of determining exemption from United States withholding taxes with
respect to all payments to be made to such Lender hereunder and under the Notes
or (b) that
23
all payments to be made to such Lender hereunder and under the Notes are subject
to such taxes at a rate reduced to zero by an applicable tax treaty. Each such
Lender agrees to provide the Administrative Agent and the Borrower with new
forms prescribed by the Internal Revenue Service upon the expiration or
obsolescence of any previously delivered form, or after the occurrence of any
event requiring a change in the most recent forms delivered by it to the
Administrative Agent and the Borrower.
Section 2.15 REPLACEMENT LENDER. If the Borrower becomes obligated
to pay additional amounts pursuant to any of Section 10.3, 2.13 or Section 2.14
to any Lender, the Borrower may designate a financial institution reasonably
acceptable to the Administrative Agent to replace such Lender by purchasing for
cash and receiving an assignment of such Lender's pro rata share of the
Commitments and the rights of such Lender under the Loan Documents without
recourse to or warranty by, or expense to, such Lender, for a purchase price
equal to the outstanding amounts owed to such Lender.
ARTICLE 3
CONDITIONS PRECEDENT
Section 3.1 CONDITIONS PRECEDENT TO INITIAL ADVANCE. The obligation of
the Lenders to undertake the Commitment and to make the initial Advance
hereunder is subject to the prior fulfillment of each of the following
conditions:
(a) The Administrative Agent shall have received each of the
following, in form and substance reasonably satisfactory to the Administrative
Agent and its counsel:
(i) The loan certificate of the Borrower, in substantially
the form attached hereto as EXHIBIT O, including a certificate of
incumbency with respect to each Authorized Signatory, together with
appropriate attachments which shall include, without limitation, the
following items: (A) a copy of the certificate of incorporation of the
Borrower, certified to be true, complete and correct by the Secretary of
State of Delaware, (B) a copy of the by-laws of the Borrower as in
effect on the Agreement Date, (C) certificates of good standing for the
Borrower issued by the Secretary of State or similar state official for
the States of Delaware, Missouri, California and Illinois, and for each
other state in which the Borrower is required to qualify or has
qualified to do business, (D) a true, complete and correct copy of the
authorizing resolutions of the Borrower, authorizing it to execute,
deliver and perform this Agreement and the other Loan Documents to which
it is a party, and (E) a true, complete and correct copy of any
agreement in effect with respect to the voting rights, ownership
interests, or management of the Borrower;
(ii) Duly executed Subordination Agreement;
(iii) Duly executed Note to the order of each Lender in the
amount of such Lender's pro rata share of the Commitment;
(iv) Duly executed Borrower's Pledge Agreement, together with
any appropriate stock certificates and undated stock powers executed in
blank;
(v) Duly executed Security Agreement;
24
(vi) Lien search results with respect to the Borrower and
each Subsidiary from all appropriate jurisdictions and filing offices;
(vii) Original UCC-1 financing statements, signed by the
Borrower as debtor and naming the Administrative Agent as secured party
to be filed in all appropriate jurisdictions;
(viii) A loan certificate from each Subsidiary of the Borrower,
in substantially the form attached hereto as EXHIBIT P, including a
certificate of incumbency with respect to each officer authorized to
execute Loan Documents on behalf of such Subsidiary, together with
appropriate attachments which shall include, without limitation, the
following items: (A) a copy of the certificate or articles of
incorporation of such Subsidiary, certified to be true, complete and
correct by the Secretary of State from the jurisdiction of incorporation
of such Subsidiary, (B) certificates of good standing for such
Subsidiary issued by the Secretary of State or similar state official
for each state in which such Subsidiary is incorporated or required to
qualify to do business, (C) a true, complete and correct copy of the
By-Laws of such Subsidiary, and (D) a true, complete and correct copy of
the resolutions of such Subsidiary authorizing it to execute, deliver
and perform the Loan Documents to which it is a party;
(ix) A duly executed Subsidiary Security Agreement, executed
and delivered by each Guarantying Subsidiary of the Borrower;
(x) Original UCC-1 financing statements, signed by each
Guarantying Subsidiary, respectively, as debtor, and naming the
Administrative Agent as secured party to be filed in all appropriate
jurisdictions;
(xi) A duly executed Subsidiary Guaranty executed and
delivered by each Guarantying Subsidiary of the Borrower;
(xii) A duly executed Subsidiary Pledge Agreement from any
Guarantying Subsidiary of the Borrower which has one or more corporate
Subsidiaries, together with appropriate stock certificates and undated
stock powers executed in blank;
(xiii) A duly executed Assignment of Intercompany Agreements
from the Borrower with respect to its rights under the Intercompany
Agreements properly acknowledged and agreed to by CellNet California,
and together with appropriate UCC-l financing statement forms and other
appropriate forms of perfection;
(xiv) A duly executed Assignment of Utility Contract from the
Borrower with respect to its rights under the Utility Contract properly
acknowledged and agreed to by Union Electric, and together with
appropriate UCC-l financing statement forms and other appropriate forms
of perfection;
(xv) A certificate executed by the Borrower and Union
Electric in form and substance satisfactory to the Administrative Agent
certifying that the Borrower is not in default under the Union Electric
Contract in any material respect and attaching a true, correct and
complete copy of the Union Electric Contract;
25
(xvi) Proof of payment of all title insurance premiums,
documentary stamp or intangible taxes, recording fees and mortgage taxes
payable in connection with the recording of any of the Loan Documents or
the issuance of the title insurance commitments referred to above
(whether due on the Agreement Date or in the future) including such
sums, if any, due in connection with any future Advances;
(xvii) Copies of any existing environmental reviews and audits
with respect to Property owned by the Borrower and other information
pertaining to actual or potential environmental claims as Administrative
Agent may require;
(xviii) Copies of insurance binders or certificates covering the
assets of the Borrower and its Subsidiaries, naming the Administrative
Agent as additional insured or named loss payee, as applicable, and
otherwise meeting the requirements of Section 5.5 hereof;
(xix) Legal opinions of (A) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
P.C., counsel to the Borrower and the Subsidiaries, regarding, among
other things, the absence of conflict between the Loan Documents
CellNet's high-yield debt documents and instruments including the
Indenture, and (B) Wikinson, Barker, ▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, FCC counsel to
the Borrower and the Subsidiaries, in each case addressed to each Lender
and the Administrative Agent, and dated as of the Agreement Date, in
substantially the forms attached hereto as EXHIBITS Q AND R,
respectively;
(xx) Duly executed Request for Advance for the initial
Advance of the Loans, which Request for Advance shall include
calculations demonstrating, as of the Agreement Date, and after giving
effect to the funding of the initial Advance hereunder and other
payments being made and effected as of the Agreement Date, the
Borrower's pro forma compliance with Sections 7.10, 7.11, 7.12 and 7.13
hereof;
(xxi) Duly executed Use of Proceeds Letter;
(xxii) Duly executed Certificate of Financial Condition for the
Borrower and its Subsidiaries on a consolidated basis, given by the
chief financial officer of the Borrower which shall include a
certification that no event has occurred which could have a Materially
Adverse Effect since June 30, 1998;
(xxiii) Audited financial statements of the Borrower and its
Subsidiaries on a consolidated basis for the fiscal year ended December
31, 1997, and an unaudited balance sheet and income statement of the
Borrower and its Subsidiaries on a consolidated basis for the fiscal
quarter ended June 30, 1998, demonstrating that CellNet has made an
equity investment in the Borrower in an amount not less than
$62,500,000;
(xxiv) Copies of any pay-off letters, termination statements,
canceled mortgages and the like required by the Administrative Agent in
connection with the satisfaction in full of all pre-existing
Indebtedness for Money Borrowed (except for Permitted Debt and CellNet
Subordinated Debt) of the Borrower and its Subsidiaries, and the
termination of any Liens (other than Permitted Liens) on the assets of
the Borrower or any of its Subsidiaries including Liens securing the
Indebtedness for Money Borrowed being refinanced by the initial Advance;
26
(xxv) Comfort Letter from CellNet, in form and substance
satisfactory to the Lenders;
(xxvi) Operating and financial projections of the Borrower
indicating future compliance with all applicable covenants during the
term of this Agreement; and
(xxvii) All such other documents as either the Administrative
Agent or any Lender may reasonably request, certified by an appropriate
governmental official or an Authorized Signatory if so requested.
(b) The Administrative Agent shall have received evidence
satisfactory to it that the Borrower has obtained all technically compatible FCC
spectrum allocations necessary to operate a wireless data transmission system
for Union Electric and that all Necessary Authorizations, including all
necessary consents to the execution, delivery and performance by the Borrower of
this Agreement and the other Loan Documents to which it is a party and by the
Subsidiaries of the Loan Documents to which they are parties, have been obtained
or made, are in full force and effect and are not subject to any pending or,
threatened reversal or cancellation prior to its stated termination date, and
the Administrative Agent shall have received a certificate of an Authorized
Signatory so stating.
(c) The Administrative Agent shall be satisfied with all terms and
conditions, including any subordination provisions, of all Indebtedness of
CellNet and all pre-existing Indebtedness (including Permitted Debt and CellNet
Subordinated Debt) of the Borrower.
(d) The Lenders, the Administrative Agent, and Paul, Hastings,
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, special counsel to the Administrative Agent, shall
receive payment of all reasonable fees and expenses due and payable on the
Agreement Date in respect of the transactions contemplated hereby.
Section 3.2 CONDITIONS PRECEDENT TO EACH ADVANCE. The obligation of
the Lenders to make each Advance (including the initial Advance hereunder) is
subject to the fulfillment of each of the following conditions immediately prior
to or contemporaneously with such Advance:
(a) All of the representations and warranties of the Borrower and the
Subsidiaries under this Agreement and the other Loan Documents (including,
without limitation, all representations and warranties with respect to the
Borrower's Subsidiaries), which, pursuant to Section 4.2 hereof, are made at and
as of the time of such Advance, shall be true and correct at such time in all
material respects, both before and after giving effect to the application of the
proceeds of such Advance;
(b) The incumbency of persons authorized by the Borrower to sign
documents shall be as stated in the certificate of incumbency delivered pursuant
to Section 3.1(a) or as subsequently modified and reflected in a certificate of
incumbency delivered to the Administrative Agent and each of the Lenders;
(c) There shall not exist, on the date of the making of the Advance
and after giving effect to the proceeds of the Advance, a Default or an Event of
Default hereunder, and the Administrative Agent shall have received a Request
for Advance signed by an Authorized Signatory so certifying;
27
(d) With respect to any Advance relating to any Acquisition,
Investment or the formation of any Subsidiary which is permitted hereunder, the
Administrative Agent and the Lenders shall have received such documents and
instruments relating to such Acquisition, Investment, or formation of a new
Subsidiary as are described in Section 5.13 hereof or otherwise required herein;
(e) The Administrative Agent shall have received a duly executed
Request for Advance which shall include calculations demonstrating compliance
with Sections 7.10, 7.11, 7.12 and 7.13 hereof and certification that since the
last day of the fiscal quarter of the Borrower most recently ended, no event has
occurred which could have a Materially Adverse Effect;
(f) The Administrative Agent shall have received financial statements
of the Borrower demonstrating compliance with Sections 7.8 and 7.9 for the
immediately preceding fiscal quarter; and
(g) The Administrative Agent and each of the Lenders shall have
received all such other certificates, reports, statements, opinions of counsel
or other documents as it may reasonably request.
The Borrower hereby agrees that the delivery of any Request for Advance
hereunder shall be deemed to be the certification of the Authorized Signatory of
the Borrower as to the matters set forth in this Section 3.2.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.1 REPRESENTATIONS AND WARRANTIES. The Borrower hereby
represents and warrants, for itself and, as applicable, on behalf of its
Subsidiaries, and for so long as any of the Obligations is outstanding and
unpaid or the Borrower shall have the right to borrow hereunder (whether or not
the conditions to borrowing have been or can be fulfilled), in favor of the
Administrative Agent and each Lender, that:
(a) ORGANIZATION; OWNERSHIP; POWER; QUALIFICATION.
(i) The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the state of Delaware.
The Borrower has the corporate power and authority to own or lease and
use its properties and to carry on its business as now being and
hereafter proposed to be conducted. The Borrower is duly qualified and
in good standing and authorized to do business in Missouri, California
and Illinois, and each other jurisdiction in which the conduct of its
business or the ownership or lease of its assets makes such
qualification necessary or prudent.
(ii) Each Subsidiary of the Borrower is a corporation duly
organized, validly existing and in good standing under the laws of the
state of its incorporation, and has the corporate power and authority to
own or lease and use its properties and to carry on its business as now
being and hereafter proposed to be conducted. Each of the Borrower's
Subsidiaries is duly qualified, in good standing and authorized to do
business in each
28
jurisdiction in which the conduct of its business or the ownership or
lease of its assets makes such qualification or authorization necessary
or prudent.
(b) AUTHORIZATION; ENFORCEABILITY. The Borrower has the corporate
power and has taken all necessary action to authorize it to borrow hereunder, to
execute, deliver and perform this Agreement and each of the other Loan Documents
to which it is a party in accordance with their respective terms, and to
consummate the transactions contemplated hereby and thereby. This Agreement has
been duly executed and delivered by the Borrower and is, and each of the other
Loan Documents which is a contract or an instrument to which the Borrower is
party is, a legal, valid and binding obligation of the Borrower enforceable
against the Borrower in accordance with its terms, subject, as to enforcement of
remedies, to the following qualifications: (i) certain equitable remedies are
discretionary and, in particular, may not be available where damages are
considered an adequate remedy at law, (ii) enforcement may be limited by
bankruptcy, insolvency, liquidation, reorganization, reconstruction and other
similar laws affecting enforcement of creditors' rights generally (insofar as
any such law relates to the bankruptcy, insolvency or similar event of the
Borrower), and (iii) enforcement may be limited by local rules and regulations
or by FCC rules and regulations, as the case may be.
(c) SUBSIDIARIES; INVESTMENTS; AUTHORIZATION; ENFORCEABILITY. The
Borrower's Subsidiaries and Investments and its direct and indirect ownership
thereof are set forth as of the Agreement Date on SCHEDULE 3 attached hereto,
and the Borrower has the unrestricted right to vote the issued and outstanding
shares of the Subsidiaries shown thereon; such shares of the Subsidiaries have
been duly authorized and issued and are fully paid and nonassessable. Each
Subsidiary of the Borrower has the corporate power and authority, and has taken
all necessary corporate action to authorize it to execute, deliver and perform
each of the Loan Documents to which it is a party in accordance with their
respective terms and to consummate the transactions applicable to such
Subsidiary which are contemplated by this Agreement and by such Loan Documents.
Each of the Loan Documents to which any Subsidiary of the Borrower is party is a
legal, valid and binding obligation of such Subsidiary enforceable against such
Subsidiary in accordance with its terms, subject, as to enforcement of remedies,
to the following qualifications: (i) certain equitable remedies are
discretionary and, in particular, may not be available where damages are
considered an adequate remedy at law, (ii) enforcement may be limited by
bankruptcy, insolvency, liquidation, reorganization, reconstruction and other
similar laws affecting enforcement of creditors' rights generally (insofar as
any such law relates to the bankruptcy, insolvency or similar event of the
applicable Subsidiary), and (iii) enforcement may be limited by local rules and
regulations or by FCC rules and regulations, as the case may be.
(d) COMPLIANCE WITH OTHER LOAN DOCUMENTS AND CONTEMPLATED
TRANSACTIONS. The execution, delivery and performance, in accordance with their
respective terms, by the Borrower of this Agreement and the Notes, and by the
Borrower and its Subsidiaries of each of the other Loan Documents to which they
are respectively party, and the consummation of the transactions contemplated
hereby and thereby, do not and will not (i) require any consent or approval,
governmental or otherwise, not already obtained, (ii) violate any Applicable Law
respecting the Borrower or any Subsidiary of the Borrower, (iii) conflict with,
result in a breach of, or constitute a default under the certificate or articles
of incorporation or by-laws, as such documents are amended, of the Borrower or
of any Subsidiary of the Borrower, or under any material indenture, agreement,
or other instrument, to which the Borrower or any of its Subsidiaries is a party
or by which any of them or their respective properties may be bound, (iv)
conflict with, result in a breach of, or constitute a default or violation of,
the terms and conditions of any of the material
29
Licenses, (v) result in or require the creation or imposition of any Lien upon
or with respect to any property now owned or hereafter acquired by the Borrower
or any of its Subsidiaries, except for Permitted Liens, or (vi) conflict with,
result in a breach of, or constitute a default under the certificate or articles
of incorporation or by-laws, as such documents are amended, of CellNet or any
other parent company of the Borrower, or under any material indenture,
agreement, or other instrument, to which CellNet or any other parent company of
the Borrower is a party or by which any of them or their respective properties
may be bound.
(e) BUSINESS. The Borrower and its Subsidiaries are engaged in the
business of owning, designing, developing, manufacturing, installing, servicing,
managing, marketing, upgrading, operating, and investing in Systems, or
otherwise providing wireless data services and in related or complementary
business activities. The Utility Contract is the legal, valid and binding
obligation of the parties thereto enforceable against each of them in accordance
with their terms.
(f) LICENSES. The Licenses and all IOAs have been duly authorized by
the grantors thereof and are in full force and effect. The Borrower and its
Subsidiaries are in compliance in all material respects with all of the
provisions thereof. The Borrower and its Subsidiaries have secured all material
Necessary Authorizations and all such material Necessary Authorizations are in
full force and effect. Neither any material License nor any material Necessary
Authorization is the subject of any pending or, to the best of the Borrower's
knowledge, threatened revocation by the Public Safety and Private Wireless
Division of the Wireless Telecommunications Bureau of the FCC.
(g) COMPLIANCE WITH LAW. The Borrower and its Subsidiaries are in
compliance with all Applicable Law.
(h) TITLE TO ASSETS. The Borrower has good, legal and marketable
title to, or a valid leasehold interest in, all of its assets. Each of the
Borrower's Subsidiaries has good, legal and marketable title to, or a valid
leasehold interest in, all of its assets. None of such properties or assets
held by the Borrower or any of its Subsidiaries is subject to any Liens, except
for Permitted Liens. Except for financing statements evidencing Permitted
Liens, no financing statement under the Uniform Commercial Code as in effect in
any jurisdiction and no other filing which names the Borrower or any of its
Subsidiaries as debtor or which covers or purports to cover any of the assets of
the Borrower or any of its Subsidiaries is currently effective and on file in
any state or other jurisdiction, and neither the Borrower nor any of its
Subsidiaries has signed any such financing statement or filing or any security
agreement authorizing any secured party thereunder to file any such financing
statement or filing.
(i) LITIGATION. There is no action, suit, revocation, proceeding or
investigation pending or, to the best of the Borrower's knowledge, threatened
against or in any other manner relating adversely to, the Borrower or any of its
Subsidiaries or any of their respective properties, including without limitation
any License or Necessary Authorization, in any court or before any arbitrator of
any kind or before or by any governmental body (including without limitation the
FCC), except as described on SCHEDULE 5 attached hereto as of the Agreement Date
or as subsequently disclosed to the Administrative Agent and the Lenders
pursuant to Section 6.5 hereof; and no such action, suit, proceeding or
investigation could reasonably be expected to have an adverse outcome which (i)
calls into question the validity of this Agreement or any other Loan Document,
(ii) challenges the continued possession and use of any License granted by the
FCC, by the Borrower, any of its Subsidiaries, or any Person in which the
Borrower has, directly
30
or indirectly, an Investment and, in any such case, such challenge could result
in a Default pursuant to Section 8.1(n) or Section 8.1(o) hereof, or (iii) could
have a Materially Adverse Effect.
(j) TAXES. All federal, state and other tax returns (including
information returns) of the Borrower and each of its Subsidiaries required by
law to be filed have been duly filed and all federal, state and other taxes,
including, without limitation, withholding taxes, assessments and other
governmental charges or levies required to be paid by the Borrower or any of its
Subsidiaries or imposed upon the Borrower or any of its Subsidiaries or any of
their respective properties, income, profits or assets, which are due and
payable, have been paid, except any such taxes (i) the payment of which the
Borrower or any of its Subsidiaries is diligently contesting in good faith by
appropriate proceedings, (ii) for which adequate reserves have been provided on
the books of the Borrower or the Subsidiary of the Borrower involved, and (iii)
as to which no Lien other than a Permitted Lien has attached and no foreclosure,
distraint, sale or similar proceedings have been commenced. The charges,
accruals and reserves on the books of the Borrower and each of its Subsidiaries
in respect of taxes are, in the reasonable business judgment of the Borrower,
adequate.
(k) FINANCIAL STATEMENTS. The Borrower has furnished or caused to be
furnished to the Administrative Agent and the Lenders its audited financial
statements on a consolidated basis with its Subsidiaries for the fiscal year
ended December 31, 1997, and its unaudited financial statements on a
consolidated basis with its Subsidiaries for the fiscal quarter ended June 30,
1998, which, together with other financial statements furnished to the
Administrative Agent and the Lenders subsequent to the Agreement Date, are
complete and correct in all material respects and present fairly in accordance
with GAAP the financial position of the Borrower and its Subsidiaries on a
consolidated basis on and as at such dates and the results of operations for the
periods then ended, subject, in the case of the quarterly statements, to
year-end audit adjustment and the absence of disclosure typically presented in
footnotes. Neither the Borrower nor any of its Subsidiaries has any material
liabilities, contingent or otherwise, other than as disclosed in the financial
statements referred to in the preceding sentence or as set forth or referred to
in this Agreement, and there are no material unrealized losses of the Borrower
or any of its Subsidiaries and no anticipated material losses of the Borrower or
any of its Subsidiaries other than those which have been disclosed in writing to
the Administrative Agent and the Lenders prior to the Agreement Date and
identified as such.
(l) NO ADVERSE CHANGE. Since September 30, 1998, there has occurred
no event which has had or which could reasonably be expected to have a
Materially Adverse Effect.
(m) ERISA. The Borrower and each of its Subsidiaries and each of
their respective Plans are in compliance in all respects with ERISA and the Code
and neither the Borrower nor any of its Subsidiaries has incurred any
accumulated funding deficiency with respect to any such Plan within the meaning
of ERISA or the Code. The Borrower, each of its Subsidiaries, and each other
ERISA Affiliate have complied with all requirements of Sections 10001 and 10002
of the Consolidated Omnibus Budget Reconciliation Act of 1985 (Public Law No.
99-272), Section 4980B of the Internal Revenue Code. Neither the Borrower nor
any of its Subsidiaries has made any promises of retirement or other benefits to
employees, except as set forth in their respective Plans. Neither the Borrower
nor any of its Subsidiaries has incurred any material liability to PBGC in
connection with any such Plan. The assets of each such Plan subject to Title IV
of ERISA are sufficient to
31
provide the benefits under such Plan. Such assets are also sufficient to
provide all other "benefit liabilities" (as defined in Section 9313(a) of the
Pension Protection Act included in the Omnibus Budget Reconciliation Act of
1987, Pub. L-100-203), Section 4001A(16) of ERISA, due under the Plan upon
termination. No Reportable Event has occurred and is continuing with respect to
any such Plan. No such Plan or trust created thereunder, or party in interest
(as defined in Section 3(14) of ERISA), or any fiduciary (as defined in Section
3(21) of ERISA), has engaged in a "prohibited transaction" (as such term is
defined in Section 406 of ERISA or Section 4975 of the Code) which would subject
such Plan or any other Plan of the Borrower or any of its Subsidiaries, any
trust created thereunder, or any such party in interest or fiduciary, or any
party dealing with any such Plan or any such trust, to the tax or penalty in any
material amount on "prohibited transactions" imposed by Section 502 of ERISA or
Section 4975 of the Code. Neither the Borrower nor any of its Subsidiaries is a
participant in or is obligated to make any payment to a Multiemployer Plan.
Neither the Borrower nor any of its Subsidiaries (1) has had either a complete
withdrawal or a partial withdrawal under Section 4201 et. seq. of ERISA from a
Multiemployer Plan which had "unfunded vested benefits" within the meaning of
Section 4211 of ERISA or (2) has ever received a notice and demand from the plan
sponsor of a Multiemployer Plan under Section 4219(b)(1) of ERISA.
(n) COMPLIANCE WITH REGULATIONS T, U, AND X. Neither the Borrower
nor any Subsidiary of the Borrower is engaged principally in or has as one of
its important activities the business of purchasing or carrying, or extending
credit for the purpose of purchasing or carrying, any margin stock within the
meaning of Regulations T, U, and X of the Board of Governors of the Federal
Reserve System; nor will any proceeds of the Loans be used for such purpose.
(o) INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY ACT.
Neither the Borrower nor any of its Subsidiaries is required to register under
the provisions of the Investment Company Act of 1940, as amended, and neither
the entering into or performance by the Borrower and its Subsidiaries of this
Agreement nor the issuance of the Notes violates any provision of such Act or
requires any consent, approval or authorization of, or registration with, the
Securities and Exchange Commission or any other governmental or public body or
authority pursuant to any provisions of such Act. Neither the Borrower nor any
of its Subsidiaries is a "public utility holding company" within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
(p) GOVERNMENTAL REGULATION. Neither the Borrower nor any of its
Subsidiaries is required to obtain any consent, approval, authorization, permit
or license which has not already been obtained from, or effect any filing or
registration which has not already been effected with, any federal, state or
local regulatory authority in connection with the execution and delivery of this
Agreement. Neither the Borrower nor any of its Subsidiaries is required to
obtain any consent, approval, authorization, permit or license which has not
already been obtained from, or effect any filing or registration which has not
already been effected with, any federal, state or local regulatory authority in
connection with the performance, in accordance with their respective terms, of
this Agreement or any other Loan Document.
(q) ABSENCE OF DEFAULT. The Borrower and its Subsidiaries are in
compliance in all respects with all of the provisions of their respective
certificates or articles of incorporation and by-laws, or their partnership
agreements, as the case may be, and no event has occurred or failed to occur
which has not been remedied or waived, the occurrence or non-occurrence of which
constitutes, or with the passage of time or giving of notice or both would
constitute, (i) an Event of Default or (ii) a material default by the Borrower
or any of its Subsidiaries under any material
32
indenture, agreement or other instrument, any License, or any judgment, decree
or order to which the Borrower or any of its Subsidiaries is a party or by which
the Borrower or any of its Subsidiaries or any of their respective properties
may be bound or affected. Neither the Borrower nor any of its Subsidiaries is a
party to or bound by any contract or agreement continuing after the Agreement
Date, or bound by any Applicable Law, that could have a Materially Adverse
Effect or result in the loss of any License issued by the FCC.
(r) ACCURACY AND COMPLETENESS OF INFORMATION. All information,
reports, prospectuses and other papers and data relating to the Borrower or any
of its Subsidiaries and furnished by or on behalf of the Borrower or any of its
Subsidiaries to the Administrative Agent or the Lenders were, at the time
furnished, true, complete and correct in all material respects to the extent
necessary to give the Administrative Agent and the Lenders true and accurate
knowledge of the subject matter. No fact or situation is currently known to the
Borrower which has had or could reasonably be expected to have a Materially
Adverse Effect.
(s) AGREEMENTS WITH AFFILIATES AND MANAGEMENT AGREEMENTS. Except as
set forth on SCHEDULE 6 attached hereto or as permitted hereunder and disclosed
to the Administrative Agent in writing, neither the Borrower nor any of its
Subsidiaries has (i) any written agreements or binding arrangements of any kind
with any Affiliate, or (ii) any material management or consulting agreements of
any kind.
(t) PAYMENT OF WAGES. The Borrower and each of its Subsidiaries are
in full compliance with the Fair Labor Standards Act, as amended, and the
Borrower and each of its Subsidiaries have paid all minimum and overtime wages
required by law to be paid to their respective employees.
(u) PRIORITY. The Security Interest is a valid and perfected first
priority security interest in the Collateral in favor of the Administrative
Agent, for itself and for the ratable benefit of the Lenders, securing, in
accordance with the terms of the Security Documents, the outstanding
Obligations, and the Collateral is subject to no Liens other than Permitted
Liens. The Liens created by the Security Documents are enforceable as security
for the outstanding Obligations in accordance with their terms with respect to
the Collateral subject, as to enforcement of remedies, to the following
qualifications: (i) certain equitable remedies are discretionary and, in
particular, may not be available where damages are considered an adequate remedy
at law, (ii) enforcement may be limited by bankruptcy, insolvency, liquidation,
reorganization, reconstruction and other similar laws affecting enforcement of
creditors' rights generally (insofar as any such law relates to the bankruptcy,
insolvency or similar event of the Borrower, or any Subsidiary), and (iii)
enforcement may be limited by local rules and regulations or by FCC rules and
regulations, as the case may be. Any Mortgage given by the Borrower or any
Subsidiary to the Administrative Agent grants a valid and perfected interest in
the Property owned by the Borrower or such Subsidiary. Any Mortgage secures, in
accordance with its terms, the Notes and the other outstanding Obligations and
such interests will be subject to no Liens that are prior to, on a parity with
or junior to the Lien in favor of the Administrative Agent other than Permitted
Liens and the CellNet Subordinated Debt, and any Mortgage will be enforceable as
security for the outstanding Obligations in accordance with its terms against
the Borrower and all third parties, subject to the following qualifications: (i)
certain equitable remedies are discretionary and, in particular, may not be
available where damages are considered an adequate remedy at law, and (ii)
enforcement may be limited by bankruptcy, insolvency, liquidation,
reorganization, reconstruction and other
33
similar laws affecting enforcement of creditors' rights generally (insofar as
any such law relates to the bankruptcy, insolvency or similar event of the
Borrower or such Subsidiary).
(v) ENVIRONMENTAL MATTERS.
(i) The Borrower and its Subsidiaries are in substantial
compliance with all applicable Environmental Laws, and there is no
condition which could interfere with the continued operation of any of
the Systems in substantial compliance with Environmental Laws, or impair
the financial condition of Borrower or its Subsidiaries.
(ii) Neither the Borrower nor its Subsidiaries has received
from any governmental authority or any other Person any complaint,
notice of violation, alleged violation, investigation or advisory action
or notice of potential liability regarding matters of environmental
protection or permit compliance under applicable Environmental Laws with
regard to the Systems. There has been no pending or, to the Borrower's
knowledge, threatened complaint, notice of violation, alleged violation,
investigation or notice of potential liability under Environmental Laws
with regard to any of the Properties.
(iii) Neither the Borrower nor any of its Subsidiaries have
generated, treated, stored, or disposed of, any Hazardous Materials on
or under any of the Property except in substantial compliance with all
Environmental Laws.
(iv) Neither the Borrower nor any Subsidiary of the Borrower
is a party to any governmental administrative actions or judicial
proceedings pending under any Environmental Law applicable to the
Borrower or any of its Subsidiaries with respect to any of the
Properties, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental Law with
respect to any of the Properties.
(w) INDEBTEDNESS. Except as permitted pursuant to Section 7.1
hereof, neither the Borrower nor any of its Subsidiaries has outstanding, as of
the Agreement Date, and after giving effect to the initial Advance hereunder on
the Agreement Date, any Indebtedness for Money Borrowed.
(x) INVESTMENTS. All Investments of the Borrower and its
Subsidiaries are shown as of the Agreement Date on SCHEDULE 3 attached hereto.
(y) REAL ESTATE. Other than as listed and described on SCHEDULE 4
attached hereto, (i) neither the Borrower nor any of its Subsidiaries owns any
real property, and (ii) no single parcel of such real estate has a fair market
value on the Agreement Date in excess of $100,000.
(z) YEAR 2000. The Borrower believes that its wireless data
communications networks are "Year 2000 Compliant" (that is, able to perform
properly date-sensitive functions for all dates before and after January 1,
2000). The Borrower and its Subsidiaries will require its third party vendors
and suppliers to be Year 2000 Compliant. The Borrower believes that the advent
of the millennium will have no adverse effect on the System.
Section 4.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made under this Agreement and the other Loan
Documents shall be deemed to be made, and shall
34
be true and correct, at and as of the Agreement Date and on the date of each
Advance except to the extent expressly applicable only to the Agreement Date or
previously fulfilled in accordance with the terms hereof. All representations
and warranties made under this Agreement shall survive, and not be waived by,
the execution hereof by the Lenders and the Administrative Agent, any
investigation or inquiry by any Lender or the Administrative Agent, or the
making of any Advance under this Agreement.
ARTICLE 5
AFFIRMATIVE COVENANTS
So long as any of the Obligations is outstanding and unpaid or the
Borrower shall have the right to borrow hereunder (whether or not the conditions
to borrowing have been or can be fulfilled):
Section 5.1 PRESERVATION OF EXISTENCE AND SIMILAR MATTERS. The
Borrower will, and will cause each of its Subsidiaries to:
(a) preserve and maintain its existence, rights, franchises, licenses
and privileges in the state of its organization and in each other state in which
it operates the System, including, without limitation, the Licenses, all IOAs
(in accordance with their respective terms) and all other Necessary
Authorizations; and
(b) qualify and remain qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature of its
business makes such qualification or authorization necessary or prudent.
Section 5.2 BUSINESS; COMPLIANCE WITH APPLICABLE LAW. The Borrower
will, and will cause each of its Subsidiaries to, (a) engage solely in the
business of owning, operating and investing in Systems, or otherwise providing
wireless data services and in related or complementary businesses, and (b)
comply with the requirements of all Applicable Law.
Section 5.3 MAINTENANCE OF PROPERTIES. The Borrower will, and will
cause each of its Subsidiaries to, maintain or cause to be maintained in the
ordinary course of business in good repair, working order and condition
(reasonable wear and tear excepted) all properties used in their respective
businesses (whether owned or held under lease), and from time to time make or
cause to be made all needed and appropriate repairs, renewals, replacements,
additions, betterments and improvements thereto, provided, however, that the
provisions of this Section 5.3 shall not prevent the Borrower or its
Subsidiaries from disposing of obsolete equipment and inventory in the ordinary
course of business.
Section 5.4 ACCOUNTING METHODS AND FINANCIAL RECORDS. The Borrower
will, and will cause each of its Subsidiaries to, maintain a system of
accounting established and administered in accordance with GAAP subject, in the
case of quarterly statements, to year-end audit adjustments, keep adequate
records and books of account in which complete entries will be made in
accordance with GAAP and reflecting all transactions required to be reflected by
GAAP and keep accurate and complete records of their respective properties and
assets. The Borrower and its Subsidiaries will maintain a fiscal year ending on
December 31.
35
Section 5.5 INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to:
(a) Maintain insurance including, but not limited to, business
interruption coverage and public liability coverage insurance from responsible
companies in such amounts and against such risks to the Borrower and each of its
Subsidiaries as is prudent and satisfactory to the Administrative Agent
(including, without limitation, larceny, embezzlement, employee fidelity, and
other criminal misappropriation insurance).
(b) Keep their respective assets insured by responsible companies on
terms and in a manner reasonably acceptable to the Administrative Agent against
loss or damage by fire, theft, burglary, pilferage, loss in transit, explosions
and hazards insured against by extended coverage, in amounts which are prudent
for the wireless or telecommunications service industry, in accordance with
industry standards, and satisfactory to the Administrative Agent, all premiums
thereon to be paid by the Borrower and its Subsidiaries.
(c) Require that each insurance policy for the Borrower and its
Subsidiaries name the Administrative Agent, as agent for the Lenders, as
additional insured or named loss payee, as appropriate, to the extent of the
Obligations, and provide for at least thirty (30) days' prior written notice to
the Administrative Agent of any termination of or proposed cancellation or
nonrenewal of such policy, or material reduction in coverage.
(d) Apply proceeds of insurance for the Borrower and its Subsidiaries
paid to the Administrative Agent at any time no Default or Event of Default
exists hereunder to the repair or replacement of the lost or destroyed property;
otherwise, such proceeds shall be applied to the payment or prepayment of the
Obligations as provided under Section 2.10(c) or Section 8.3 hereof, as
applicable. Any balance thereof remaining after payment in full of the
Obligations shall be paid to the Borrower or as otherwise required by law.
Section 5.6 PAYMENT OF TAXES AND CLAIMS. The Borrower will, and will
cause each of its Subsidiaries to, pay and discharge all taxes, including,
without limitation, withholding taxes, assessments and governmental charges or
levies required to be paid by them or imposed upon them or their income or
profits or upon any properties belonging to them, prior to the date on which
penalties attach thereto, and all lawful claims for labor, materials and
supplies which, if unpaid, could become a Lien or charge upon any of their
properties; except that no such tax, assessment, charge, levy or claim need be
paid which is being diligently contested in good faith by appropriate
proceedings and for which adequate reserves shall have been set aside on the
appropriate books, but only so long as such tax, assessment, charge, levy or
claim does not become a Lien or charge other than a Permitted Lien and no
foreclosure, distraint, sale or similar proceedings shall have been commenced.
The Borrower will, and will cause each of its Subsidiaries to, timely file all
information returns required by federal, state or local tax authorities.
Section 5.7 VISITS AND INSPECTIONS. The Borrower will, and will cause
each of its Subsidiaries to, permit representatives of the Administrative Agent
and any of the Lenders to, upon reasonable notice to the Borrower or such
Subsidiary and during normal business hours, (a) visit and inspect the
properties of the Borrower or such Subsidiary, (b) inspect and make extracts
from and copies of their respective books and records, and (c) discuss with
their respective principal officers their respective businesses, assets,
liabilities, financial positions and results of operations. The Borrower and
each of its Subsidiaries will also permit representatives
36
of the Administrative Agent and any of the Lenders to discuss with their
respective auditors, subject to Section 11.17 hereof, their respective
businesses, assets, liabilities, financial positions and results of operations.
The Borrower will, and will cause each of its Subsidiaries to, and will use its
best efforts to cause Union Electric to, cooperate with the Administrative Agent
in ensuring, on a regular basis, that the Administrative Agent and any of the
Lenders may visit and inspect the System located on Union Electric's premises.
Section 5.8 PAYMENT OF INDEBTEDNESS; LOANS. Subject to any provisions
regarding subordination as set forth in any Loan Document, the Borrower will,
and will cause each of its Subsidiaries to, pay any and all of their respective
Indebtedness when and as it becomes due, and in any event prior to the
expiration of any grace period, other than amounts diligently disputed in good
faith and for which adequate reserves have been set aside in accordance with
GAAP.
Section 5.9 USE OF PROCEEDS. The Borrower will use the aggregate
proceeds of all Advances under the Commitment (a) to fund the development and
construction of a wireless data transmission system for Union Electric pursuant
to the terms and conditions of the Union Electric Contract, (b) to fund Capital
Expenditures and Acquisitions to the extent permitted herein, (c) to make
Permitted Investments, (d) to make Restricted Payments to the extent permitted
under Section 7.7 hereof, and (e) for working capital and other general
corporate purposes. Except as may be permitted under Section 7.6(a) hereof, no
proceeds of Advances hereunder shall be used for the purchase or carrying or the
extension of credit for the purpose of purchasing or carrying any margin stock
within the meaning of Regulations T, U, and X of the Board of Governors of the
Federal Reserve System.
Section 5.10 REAL ESTATE. The Borrower will, and will cause its
Subsidiaries to, grant a Mortgage securing the Obligations to the Administrative
Agent, for itself and for the ratable benefit of the Lenders, in form and
substance satisfactory to the Administrative Agent, covering each parcel of real
estate having a fair market value, exclusive of equipment, in excess of $100,000
acquired by the Borrower or any of its Subsidiaries after the Agreement Date.
The Borrower will, and will cause its Subsidiaries to, deliver to the
Administrative Agent all documentation, including opinions of counsel and
policies of title insurance, which in the opinion of the Administrative Agent is
appropriate with each such grant, including any Phase I environmental audit
requested by the Administrative Agent or any Lender.
Section 5.11 INDEMNITY. The Borrower, for itself and on behalf of each
of its Guarantying Subsidiaries agrees, jointly and severally, to indemnify and
hold harmless each Lender and the Administrative Agent and each of their
respective Affiliates, employees, agents, representatives, officers and
directors (any of the foregoing shall be an "Indemnitee") from and against any
and all claims, liabilities, losses, damages, actions, reasonable attorneys'
fees and expenses (as such fees and expenses are incurred) and demands by any
party, including the costs of investigating and defending such claims, (a)
resulting from any breach or alleged breach by the Borrower or any Subsidiary of
the Borrower of any representation, warranty, or covenant made hereunder or
under any other Loan Document; (b) arising out of or in connection with (i) the
Commitment or the administration of the Loans or otherwise under this Agreement
or any other Loan Document (including the taking of Collateral for the
Obligations), including the use of the proceeds of Loans hereunder in any
fashion or the performance of their respective obligations under the Loan
Documents by the Borrower or any of its
37
Subsidiaries, (ii) allegations of any participation by the Lenders or the
Administrative Agent, or any of them, in the affairs of the Borrower or any of
its Subsidiaries, or allegations that any of them has any joint liability with
the Borrower or any of its Subsidiaries for any reason, or (iii) any claims
against the Lenders or the Administrative Agent, or any of them, by any
shareholder, partner, or other investor in or lender to the Borrower or any
Subsidiary, by any brokers or finders or investment advisers or investment
bankers retained by the Borrower or by any Affiliates of Borrower, arising out
of the Commitment or otherwise under this Agreement or any other Loan Document;
or (c) in connection with taxes (other than income taxes and other than tax
liability resulting from the failure by any Lender to comply with the provisions
of Section 2.14 hereof), fees, and other charges payable as a result of making
the Loans, or the execution, delivery, and enforcement of this Agreement, the
Security Documents, the other Loan Documents, and any amendments thereto or
waivers of any of the provisions thereof; unless the Person seeking
indemnification hereunder is determined in such case to have acted with gross
negligence or willful misconduct, in any case by a final, non-appealable
judicial order. The obligations of the Borrower and the Subsidiaries under this
Section 5.11 are in addition to, and shall not otherwise limit, any liabilities
which the Borrower or any Subsidiary might otherwise have in connection with any
warranties or similar obligations of the Borrower or such Subsidiary in any
other agreement or instrument or for any other reason.
Section 5.12 INTEREST RATE HEDGING. Within ninety (90) days from the
Agreement Date and from the funding of any additional Advance requested by the
Borrower representing a new borrowing, the Borrower shall have entered into one
or more Interest Hedge Agreements which result in the fixing of a limit on the
Borrower's interest obligations at interest rates and other terms (such terms to
include consideration of the creditworthiness of the other party to the proposed
Interest Hedge Agreement) reasonably acceptable to the Administrative Agent with
respect to the Loans on an aggregate of not less than thirty-three percent (33%)
of the then outstanding principal amount of Total Debt. Such Interest Hedge
Agreements shall provide interest rate protection for at least one (1) year from
the date of such Interest Hedge Agreement or Agreements. All obligations of the
Borrower to the Administrative Agent, the Lenders, or any of them, or any
Affiliate of any of them, pursuant to any Interest Hedge Agreement, shall be
deemed to be part of the Obligations.
Section 5.13 COVENANTS REGARDING FORMATION OF SUBSIDIARIES AND THE
MAKING OF INVESTMENTS AND ACQUISITIONS. At the time of any Acquisition of a
Guarantying Subsidiary permitted hereunder by the Borrower or any Subsidiary, or
the formation of any new Guarantying Subsidiary of the Borrower or any of its
Subsidiaries which is permitted under this Agreement, the Borrower will, and
will cause its Subsidiaries, as appropriate, to (a) provide to the
Administrative Agent an executed supplement to the Subsidiary Security Agreement
for such new Subsidiary, in substantially the form of the supplement to
EXHIBIT M-1 attached hereto, together with appropriate UCC-1 financing
statements, as well as an executed supplement to the Subsidiary Guaranty for
such new Guarantying Subsidiary, in substantially the form of the supplement to
EXHIBIT K attached hereto, which shall constitute both Security Documents and
Loan Documents for purposes of this Agreement, as well as a loan certificate for
such new Guarantying Subsidiary, substantially in the form of EXHIBIT P attached
hereto, together with appropriate attachments; (b) pledge to the Administrative
Agent all of the stock (or other instruments or securities evidencing ownership)
of such Subsidiary or Person which is acquired, formed or beneficially owned by
the Borrower or any of the Borrower's Subsidiaries, as the case may be, as
additional Collateral for the Obligations to be held by the Administrative Agent
in accordance with the terms of the Borrower's Pledge Agreement, a supplement to
the Subsidiary Pledge Agreement, a supplement to the Assignment of Intercompany
Agreements, or a supplement to the Assignment of Utility Contract, and execute
and deliver to the Administrative Agent all such documentation for such pledge
as, in the reasonable opinion of the Administrative
38
Agent, is appropriate; and (c) provide all other documentation, including one or
more opinions of counsel satisfactory to the Administrative Agent which in the
opinion of the Administrative Agent is appropriate with respect to such
Acquisition or the formation of such Guarantying Subsidiary. At the time of any
Acquisition of any new Subsidiary permitted hereunder by the Borrower or any
Subsidiary, or the formation of any new Subsidiary of the Borrower or any of its
Subsidiaries, which new Subsidiary is, in either such case, a Non-Guarantying
Subsidiary, the Borrower shall provide to the Administrative Agent copies of
agreements and documents executed and delivered by such Subsidiary and the
Borrower, and collaterally assigned to the Administrative Agent by the Borrower,
and otherwise corresponding to all of the agreement's documents described in
clauses (a) through (c) of this subsection, including, without limitation, an
executed supplement to the Non-Guarantying Subsidiary Security Agreement for
such new Non-Guarantying Subsidiary, in substantially the form of the supplement
to EXHIBIT M-2 attached hereto. Investments made by the Borrower or any of its
Guarantying Subsidiaries after the Agreement Date shall also be treated as
additional Collateral and shall be subject to the provisions of appropriate
Security Documents. Any document, agreement or instrument executed or issued
pursuant to this Section 5.13 shall be a "Loan Document" for purposes of this
Agreement.
Section 5.14 PAYMENT OF WAGES. The Borrower and each of its
Subsidiaries shall at all times comply, in all material respects, with the
requirements of the Fair Labor Standards Act, as amended, including, without
limitation, the provisions of such Act relating to the payment of minimum and
overtime wages as the same may become due from time to time.
Section 5.15 COMPLIANCE WITH CONTRACTS. The Borrower and each of its
Subsidiaries shall at all times comply with the terms and conditions of the
Utility Contract.
Section 5.16 YEAR 2000 PROBLEM. The Borrower shall furnish or cause to
be furnished to each Lender and the Administrative Agent, promptly upon creation
thereof, copies of any review or assessment of the System in connection with, or
plan for the Borrower or any of its Subsidiaries relating to, the Year 2000
Problem.
ARTICLE 6
INFORMATION COVENANTS
So long as any of the Obligations is outstanding and unpaid or the
Borrower has a right to borrow hereunder (whether or not the conditions to
borrowing have been or can be fulfilled), the Borrower will furnish or cause to
be furnished to each Lender and the Administrative Agent, at their respective
offices:
Section 6.1 QUARTERLY FINANCIAL STATEMENTS AND INFORMATION. Within
forty-five (45) days after the last day of each quarter of each fiscal year of
the Borrower, unaudited balance sheets of the Borrower on a consolidated and
consolidating basis with its Subsidiaries, as at the end of such quarter and as
of the end of the preceding fiscal year, and the related statements of
operations and the related statements of cash flows of the Borrower on a
consolidated and consolidating basis with its Subsidiaries, for such quarter and
for the elapsed portion of the year ended with the last day of such quarter,
which shall set forth in comparative form such figures as at the end of and for
such quarter and the appropriate prior period and shall be certified by the
39
chief financial officer of the Borrower, to be, in his or her opinion, complete
and correct in all material respects and to present fairly, in accordance with
GAAP (except as to the exclusion of certain Subsidiaries which should be
consolidated with the Borrower under GAAP), the financial position of the
Borrower on a consolidated and consolidating basis with its Subsidiaries, as at
the end of such period and the results of operations for such period, and for
the elapsed portion of the year ended with the last day of such period, subject
only to normal year-end adjustments and the absence of footnotes.
Section 6.2 ANNUAL FINANCIAL STATEMENTS AND INFORMATION. Within one
hundred and twenty (120) days after the end of each fiscal year of the Borrower,
the audited consolidated and consolidating balance sheet of CellNet and its
Subsidiaries as of the end of such fiscal year and the related audited
consolidated and consolidating statements of operations for such fiscal year
and, to the extent available, for the previous two (2) fiscal years, the related
audited consolidated and consolidating statements of changes in shareholders'
equity for such fiscal year and, to the extent available, for the previous two
(2) fiscal years, and related audited consolidated and consolidating statements
of cash flows of such fiscal year and, to the extent available, for the previous
two (2) fiscal years, which shall be accompanied by an opinion of independent
certified public accountants of recognized national standing reasonably
acceptable to the Administrative Agent, together with a statement of such
accountants that in connection with their audit, nothing came to their attention
that caused them to believe that the Borrower was not in compliance with the
terms, covenants, provisions or conditions of Article 7 hereof.
Section 6.3 PERFORMANCE CERTIFICATES. At the time the financial
statements are furnished pursuant to Sections 6.1 and 6.2 hereof, the
Performance Certificate:
(a) setting forth as at the end of such quarterly period or fiscal
year, as the case may be, the arithmetical calculations required to establish
(i) the Applicable Margin pursuant to Section 2.3(f) hereof, and (ii) whether or
not the Borrower was in compliance with the requirements of Sections 7.10, 7.11,
7.12 and 7.13 hereof;
(b) setting forth on a consolidated basis for the Borrower and its
Subsidiaries, for each such fiscal quarter or fiscal year, as the case may be,
(i) a summary of monthly revenues and (ii) (A) the number of Active Meters at
the beginning of such period, (B) the number of new Active Meters added or
deactivated during such period and (C) the number of Active Meters at the end of
such period;
(c) stating that, to the best of his or her knowledge, no Default or
Event of Default has occurred as at the end of such quarterly period or year, as
the case may be, or, if a Default or an Event of Default has occurred,
disclosing each such Default or Event of Default and its nature, when it
occurred, whether it is continuing and the steps being taken by the Borrower
with respect to such Default or Event of Default; and
(d) setting forth, as of the end of such fiscal quarter or year, a
list of any IOAs pursuant to which the Borrower or any of its Subsidiaries is
then providing cellular telephone or other wireless telecommunications services.
40
Section 6.4 COPIES OF OTHER REPORTS.
(a) Promptly upon receipt thereof, copies of all material reports, if
any, submitted to the Borrower by the Borrower's independent public accountants
regarding the Borrower, including, without limitation, any management report
prepared in connection with the annual audit referred to in Section 6.2.
(b) Promptly upon receipt thereof, copies of any material adverse
notice or report regarding any License held by the Borrower or any Subsidiary
from the FCC.
(c) In connection with any proposed Acquisition by the Borrower or
any Subsidiary and promptly upon each request, such data, certificates, reports,
statements, opinions of counsel prepared for the Administrative Agent and the
Lenders, or any of them, documents or further information regarding the
business, assets, liabilities, financial position, projections, results of
operations, or Year 2000 issues described in Sections 4.1(z) and 5.16 hereof, of
the Borrower or any of its Subsidiaries as the Administrative Agent or any
Lender may reasonably request.
(d) Annually, one or more certificates of insurance indicating that
the requirements of Section 5.5 hereof remain satisfied for such fiscal year.
(e) Annually, and in no event later than the 120th day of each year,
a copy of the Borrower's annual budget for itself and its Subsidiaries for such
fiscal year.
(f) Promptly after the filing thereof, copies of all material
reports, proxies, forms or other documents required to be filed or submitted by
CellNet to the Securities and Exchange Commission or other federal or state
securities law enforcement agency or commission, without exhibits thereto unless
requested.
Section 6.5 NOTICE OF LITIGATION AND OTHER MATTERS. Notice specifying
the nature and status of any of the following events, promptly, but in any event
not later than five (5) Business Days after any officer the Borrower becomes
aware of the occurrence of any of the following events:
(a) the commencement of any proceeding or investigation by or before
any governmental body and any action or proceeding in any court or before any
arbitrator against, or to the extent known to the Borrower, in any other way
relating materially adversely to the Borrower or any Subsidiary of the Borrower
or any of their respective properties, assets or businesses or any License;
(b) any event having a Materially Adverse Effect;
(c) any Default or the occurrence or non-occurrence of any event (i)
which constitutes, or which with the passage of time or giving of notice or both
would constitute a material default by the Borrower or any Subsidiary of the
Borrower under the Utility Contract or other material agreement other than this
Agreement to which the Borrower or any Subsidiary of the Borrower is a party or
by which any material portion of their respective properties may be bound, or
(ii) which could reasonably be expected to have a Materially Adverse Effect,
giving in each case the details thereof and specifying the action proposed to be
taken with respect thereto;
41
(d) the receipt by the Borrower or any of its Subsidiaries of a
notice of default from (i) Union Electric relating to the Union Electric
Contract or (ii) any other utility company relating to any other utility
contract;
(e) the occurrence of any Reportable Event or a "prohibited
transaction" (as such term is defined in Section 406 of ERISA or Section 4975 of
the Code) with respect to any Plan of the Borrower or any of its Subsidiaries,
or any of their ERISA Affiliates, or the institution or threatened institution
by PBGC of proceedings under ERISA to terminate or to partially terminate any
such Plan, or the termination or partial termination of any such Plan, or the
commencement or threatened commencement of any litigation regarding any such
Plan or naming it or the trustee of any such Plan with respect to such Plan; and
(f) the occurrence of any event subsequent to the Agreement Date
which, if such event had occurred prior to the Agreement Date, would have
constituted an exception to the representation and warranty in Section 4.1(m) of
this Agreement.
ARTICLE 7
NEGATIVE COVENANTS
So long as any of the Obligations is outstanding and unpaid or the
Borrower has a right to borrow from the Lenders hereunder (whether or not the
conditions to borrowing have been or can be fulfilled):
Section 7.1 INDEBTEDNESS OF THE BORROWER AND ITS SUBSIDIARIES.
The Borrower shall not, and shall cause each of its Subsidiaries not to,
create, assume, incur or otherwise become or remain obligated in respect of, or
permit to be outstanding, any Indebtedness except:
(a) The Obligations;
(b) Current accounts payable, accrued expenses, customer advance
payments and other current liabilities (other than for money borrowed) incurred
in the ordinary course of business;
(c) CellNet Subordinated Debt;
(d) An amount not to exceed $500,000 in the aggregate at any time
outstanding consisting of (i) Capitalized Lease Obligations, and (ii)
Indebtedness secured by purchase money security interests described in
subparagraph (g)(ii) of the definition of Permitted Liens set forth in Article 1
hereof;
(e) Other unsecured Indebtedness, including without duplication any
Guaranties of the Borrower or any Subsidiary not otherwise permitted pursuant to
clauses (a) through (d) of Section 7.5, in an amount not to exceed $2,000,000 in
the aggregate at any time outstanding; and
(f) Indebtedness under Interest Hedge Agreements entered into in
satisfaction of the Borrower's obligations under Section 5.12 hereof.
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Section 7.2 LIMITATION ON LIENS. The Borrower shall not, and shall
cause each of its Subsidiaries not to, create, assume, incur or permit to exist
or to be created, assumed, incurred or permitted to exist, directly or
indirectly, any Lien on any of its properties or assets, whether now owned or
hereafter acquired, except for Permitted Liens.
Section 7.3 AMENDMENT AND WAIVER. The Borrower shall not, and shall
cause each of its Subsidiaries not to enter into any amendment of, or agree to
or accept or consent to any waiver of any of the material provisions of (a) its
articles or certificate of incorporation in any fashion which would adversely
effect the position of the Lenders, (b) the Utility Contract, or (c) the
Intercompany Agreements.
Section 7.4 LIQUIDATION, MERGER, DISPOSITION OF ASSETS.
(a) DISPOSITION OF ASSETS. The Borrower shall not, and shall cause
each of its Subsidiaries not to, at any time sell, lease, abandon, or otherwise
dispose of any of its or their assets other than:
(i) the sale of immaterial amounts of assets at the fair
market value thereof in the ordinary course of business of the Borrower
and its Subsidiaries;
(ii) the sale of disposal of obsolete equipment;
(iii) the sale or exchange of assets, in the ordinary course
of business, in exchange for comparable substitute or replacement
assets;
(iv) the sale of assets subject to purchase money or
capitalized lease financing otherwise permitted hereunder; or
(v) the sale of other assets (including any System and
ownership interests in Subsidiaries of the Borrower) provided that (x)
all Net Proceeds therefrom are applied as provided in Section 2.8(b)
hereof, (y) no Default then exists or would be caused thereby, and
(z) all Lenders give their prior written consent to such sale or other
disposition.
At the time of any such sale pursuant to clause (v) above (a "Permitted Asset
Sale"), the Borrower shall provide the Administrative Agent and the Lenders with
projections assuming the consummation of the Permitted Asset Sale and
demonstrating pro forma compliance with Sections 7.8, 7.9, 7.10, 7.11, 7.12 and
7.13 hereof for the remaining term of this Agreement.
(b) LIQUIDATION OR MERGER. The Borrower shall not, and shall cause
each of its Subsidiaries not to, at any time liquidate or dissolve itself (or
suffer any liquidation or dissolution) or otherwise wind up, or enter into any
merger, provided that if no Default then exists or would be caused thereby, the
following such transactions are permitted: (i) a merger among the Borrower and
one or more Subsidiaries, provided the Borrower is the surviving Person; (ii) a
merger between or among two or more Subsidiaries; (iii) an Acquisition permitted
hereunder effected by a merger in which the Borrower or a Subsidiary of the
Borrower is the surviving Person; and (iv) a liquidation or dissolution of one
or more Subsidiaries into its or their parent entity (provided the Borrower or
one of its Subsidiaries is such parent entity).
43
Section 7.5 LIMITATION ON GUARANTIES. The Borrower shall not, and
shall cause each of its Subsidiaries not to, at any time Guaranty, assume, be
obligated with respect to, or permit to be outstanding any Guaranty of, any
obligation of any other Person other than (a) a guaranty by endorsement of
negotiable instruments for collection in the ordinary course of business,
(b) obligations under agreements of the Borrower or any of its Subsidiaries
entered into in connection with leases of real property or the acquisition of
services, supplies and equipment in the ordinary course of business of the
Borrower or any of its Subsidiaries, (c) Guaranties permitted by Section 7.1(e)
hereof, or (d) as may be contained in any Loan Document.
Section 7.6 INVESTMENTS AND ACQUISITIONS. The Borrower shall not, and
shall cause each of its Subsidiaries not to, make any loan or advance, or make
any Investment or otherwise acquire for consideration evidences of Indebtedness,
capital stock or other securities of any Person, or make any Acquisition, except
that, so long as no Default then exists or would be caused thereby:
(a) The Borrower and its Subsidiaries may, directly or through a
brokerage account, purchase (i) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof;
(ii) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either S&P or ▇▇▇▇▇'▇; (iii) commercial paper maturing no more
than one year from the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 from S&P or at least P-1 from ▇▇▇▇▇'▇;
(iv) certificates of deposit, Eurodollar deposits, or bankers' acceptances
maturing within one year from the date of acquisition thereof issued by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia or any U.S. branch of a foreign bank
having at the date of acquisition thereof combined capital and surplus of not
less than $500,000,000; (v) repurchase agreements and reverse repurchase
agreements maturing within one year from the date entered into with any bank
meeting the qualifications specified in clause (iv) above; and (vi) investments
in mutual funds and money market accounts investing at least 90% of the funds in
Investments of the types described in the foregoing clauses (i) through (v); and
(b) The Borrower and its Subsidiaries may make distributions to
CellNet California as part of the California Investment if (i) the Borrower
shall have certified to the Administrative Agent and the Lenders that (x) such
distribution shall not cause or result in a Default or an Event of Default
hereunder, and (y) no default or event of default under any of the Intercompany
Agreements then exists or will be caused thereby, (ii) copies of all executed
Intercompany Agreements have been sent to the Administrative Agent, and a duly
executed Assignment of Intercompany Agreements has been sent to the
Administrative Agent, pursuant to the latter of which all rights of the Borrower
in the Intercompany Agreements shall be assigned to the Administrative Agent for
the benefit of the Lenders, and (iii) the amount of CellNet's equity investment
in CellNet California shall at all times equal or exceed the sum of the
aggregate amount of the California Investment, PLUS $15,000,000.
Section 7.7 RESTRICTED PAYMENTS AND PURCHASES. The Borrower shall not,
and shall cause each of its Subsidiaries not to, directly or indirectly declare
or make any Restricted Payment or Restricted Purchase (other than to the extent
permitted in Section 7.6(b) hereof) except that so long as no Default hereunder
then exists or would be caused thereby:
44
(a) So long as the Leverage Ratio is below 5.00, on or after each
date specified for mandatory reduction of the Commitment pursuant to Section
2.8(a) hereof, the Borrower may pay dividends or repay CellNet Subordinated
Debt, provided that (i) the Borrower shall have prepaid the Loans from its
Excess Cash Flow for the preceding four (4) fiscal quarter period in the amount
required by Section 2.8(a) hereof, (ii) the amount of such dividends and
distributions paid and made on or after such date for such period shall not
exceed the amount required to be prepaid on the Loans by the Borrower pursuant
to Section 2.8(a) hereof (the "Remaining Excess Cash Flow"), and (iii) the
Borrower shall provide the Lenders with a certificate, signed by the chief
financial officer of the Borrower, demonstrating pro forma compliance with the
terms of this Section 7.7, after giving effect to such dividend payments or
repayments of CellNet Subordinated Debt;
(b) So long as the Leverage Ratio is below 5.00, the Borrower may pay
cash management fees to CellNet in an amount not to exceed, in any fiscal year,
five percent (5%) of the Borrower's annual gross revenues for the preceding
fiscal year; and
(c) The Borrower may make distributions to CellNet to repay CellNet
Subordinated Debt in an amount not to exceed $10,000,000 in the aggregate if the
Borrower shall have delivered to the Administrative Agent, a compliance
certificate for any fiscal quarter in 1999, demonstrating (i) that the
Borrower's Leverage Ratio has not exceeded 8:50 to 1:00 during such quarter, and
(ii) pro forma compliance with Sections 7.8, 7.9, 7.10, 7.11, 7.12 and 7.13
hereof, after giving effect to such distributions.
Section 7.8 MINIMUM REVENUE. During the Implementation Phase, the
Borrower shall not permit its gross revenue as of the end of any fiscal quarter
times four (4) to be less than the amounts set forth below for such quarter:
QUARTER ENDING AMOUNT
-------------- ------
September 30, 1998 $5,100,000
December 31, 1998 $5,600,000
March 31, 1999 $6,800,000
June 30, 1999 $8,400,000
September 30, 1999 $10,450,000
December 31, 1999 $12,250,000
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Section 7.9 MINIMUM OPERATING CASH FLOW. During the Implementation Phase,
the Borrower shall not permit its Operating Cash Flow as of the end of any
fiscal quarter times four (4) to be less than the amounts set forth below for
such quarter:
QUARTER ENDING AMOUNT
-------------- ------
September 30, 1998 $759,000
December 31, 1998 $1,000,000
March 31, 1999 $2,100,000
June 30, 1999 $2,950,000
September 30, 1999 $4,050,000
December 31, 1999 $4,800,000
Section 7.10 CAPITAL EXPENDITURES. The Borrower shall not make or incur,
in the aggregate, any Capital Expenditures, during a calendar year, in excess of
the amounts set forth below for the periods indicated:
CALENDAR YEAR AMOUNT
------------- ------
1998 $37,500,000
1999 $17,500,000
2000 through 2003 $3,000,000
2004 and thereafter $2,000,000 per annum
PROVIDED, HOWEVER, that the Borrower may make Capital Expenditures in excess of
the amounts listed above to the extent such Capital Expenditures are funded by
CellNet Subordinated Debt invested in the Borrower after the Agreement Date. Up
to twenty-five percent (25%) of any year's Capital Expenditures limit which is
unused for Capital Expenditures in such year may be carried forward to the next
year; PROVIDED, HOWEVER, that any amounts used for Capital Expenditures which
are funded by CellNet Subordinated Debt as provided in the preceding clause
shall not increase the unused Capital Expenditures amount for purposes of this
carryforward provision.
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Section 7.11 LEVERAGE RATIO. After the Implementation Phase, the Borrower
shall not at any time permit the Leverage Ratio to exceed the ratio set forth
below during the periods indicated:
PERIOD RATIO
------ -----
Agreement Date through December 30, 1999 N/A
December 31, 1999 through and including June 29, 2000 8.50:1
June 30, 2000 through and including December 30, 2000 8.00:1
December 31, 2000 through and including June 29, 2001 7.50:1
June 30, 2001 through and including March 30, 2002 6.25:1
March 31, 2002 through and including March 30, 2003 5.50:1
March 31, 2003 and thereafter 4.00:1
Section 7.12 PRO FORMA DEBT SERVICE RATIO. After the Implementation
Phase, the Borrower shall not permit as of the end of any fiscal quarter the
ratio of Annualized Operating Cash Flow to Pro Forma Debt Service to be less
than (a) 1.20:1 for the fiscal quarters ending during the period from December
31, 1999 through December 30, 2003 and (b) 1.30:1 for any fiscal quarter ending
on or after December 31, 2003.
Section 7.13 INTEREST COVERAGE RATIO. After the Implementation Phase, the
Borrower shall not as of the end of any fiscal quarter permit the ratio of
(i) Annualized Operating Cash Flow to (ii) Cash Interest Expense for the four
(4) fiscal quarter period then ended, to be less than the ratio set forth below
for such quarter:
PERIOD RATIO
------ -----
Agreement Date through December 30, 1999 N/A
December 31, 1999 through December 30, 2001 1.50:1
December 31, 2001 through December 30, 2003 2.00:1
December 31, 2003 and thereafter 2.50:1
Section 7.14 AFFILIATE TRANSACTIONS. Except as specifically provided
herein (including, without limitation, Section 7.7 hereof) and as may be
described on SCHEDULE 6 attached hereto, and except for fees and compensation
payable to officers and directors within customary parameters, the Borrower
shall not, and shall cause each of its Subsidiaries not to, at any time engage
in any transaction with an Affiliate (except for transactions between or among
the Borrower and its Subsidiaries), or make an assignment or other transfer of
any of its properties or assets to any Affiliate, on terms less advantageous to
the Borrower or such Subsidiary than would be the case if such transaction had
been effected with a non-Affiliate.
47
Section 7.15 REAL ESTATE. Neither the Borrower nor any of its
Subsidiaries shall purchase or become obligated to purchase any single parcel of
real estate having a purchase price in excess of $100,000 except in compliance
with Section 5.10 hereof.
Section 7.16 ERISA LIABILITIES. The Borrower shall not, and shall
cause each of its Subsidiaries not to (i) permit the assets of any of their
respective Plans to be less than the amount necessary to provide all accrued
benefits under such Plans on an ongoing basis, or (ii) enter into any
Multiemployer Plan.
ARTICLE 8
DEFAULT
Section 8.1 EVENTS OF DEFAULT. Each of the following shall constitute
an Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
governmental or non-governmental body:
(a) (i) Any representation or warranty made under this Agreement or
any other Loan Document shall prove to be incorrect or misleading when made or
deemed to be made pursuant to Section 4.2 hereof, or (ii) any legal opinion
given in connection with this Agreement shall be revoked or withdrawn after its
issuance;
(b) (i) The Borrower shall default in the payment of any interest,
fees or other amounts payable to the Lenders, the Administrative Agent, or any
of them, when due, and such Default shall not be cured by payment in full within
three (3) Business Days, or (ii) the Borrower shall default in the payment of
any principal amount of the Notes;
(c) The Borrower shall default in the performance or observance of
any agreement or covenant contained in Sections 5.12, 5.13, 5.14 or 5.15;
Sections 6.1, 6.2 or 6.3; or any Section in Article 7, other than Sections 7.8,
7.9 and 7.11.
(d) The Borrower shall default in the performance or observance of
any agreement or covenant contained in Section 7.11 hereof; PROVIDED, that if
the Borrower, within fifteen (15) days from the date the financial statements
are delivered to the Administrative Agent pursuant to Sections 6.1 and 6.2
hereof, by using the proceeds from its issuance of CellNet Subordinated Debt,
reduces the amount of Total Debt then outstanding as of the relevant calculation
date to an amount such that a Default would not occur under Section 7.11, no
Default or Event of Default shall be deemed to have occurred; PROVIDED FURTHER,
the Borrower may not use the right to prevent a Default under Section 7.11 as
set forth in the preceding clause in more than one (1) consecutive quarter or on
more than three (3) occasions in total.
(e) The Borrower shall fail to meet one of the Performance Tests
applicable to any fiscal quarter (i) at the end of the fiscal quarter in which
such Performance Test is applicable, and (ii) in the subsequent fiscal quarter.
(f) The Borrower shall default in the performance or observance of
any other agreement or covenant contained in this Agreement not specifically
referred to elsewhere in this Section 8.1,
48
and such default shall not be cured within a period of thirty (30) days from the
date of occurrence of such default;
(g) There shall occur any default in the performance or observance of
any agreement or covenant or breach of any representation or warranty contained
in any of the Loan Documents (other than this Agreement or as otherwise provided
in this Section 8.1) by the Borrower, any of its Subsidiaries, or any other
obligor thereunder, which shall not be cured within a period of thirty (30) days
from the date of occurrence of such default;
(h) There shall be entered and remain unstayed a decree or order for
relief in respect of the Borrower, any of its Subsidiaries or Union Electric
under Title 11 of the United States Code as now constituted or hereafter
amended, or any other applicable Federal or state bankruptcy law or other
similar law, or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official of the Borrower, any of its Subsidiaries or of
Union Electric, or of any substantial part of their respective properties, or
ordering the winding-up or liquidation of the affairs of the Borrower, any of
its Subsidiaries or Union Electric; or an involuntary petition shall be filed
against the Borrower, any of its Subsidiaries or Union Electric and a temporary
stay entered, and (i) such petition and stay shall not be diligently contested,
or (ii) such petition and stay shall continue undismissed for a period of
forty-five (45) consecutive days;
(i) The Borrower, any of its Subsidiaries or Union Electric shall
file a petition, answer or consent seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other applicable
Federal or state bankruptcy law or other similar law, or the Borrower, any of
its Subsidiaries or Union Electric shall consent to the institution of
proceedings thereunder or to the filing of any such petition or shall seek or
consent to the appointment or taking of possession of a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Borrower, any of its Subsidiaries or Union Electric, or of any substantial part
of their respective properties, or the Borrower, any of its Subsidiaries or
Union Electric shall fail generally to pay their respective debts as they become
due, or the Borrower, any of its Subsidiaries or Union Electric shall take any
action in furtherance of any such action;
(j) A judgment shall be entered by any court against the Borrower or
any of its Subsidiaries for the payment of money which exceeds singly or in the
aggregate with other such judgments, $1,000,000, or a warrant of attachment or
execution or similar process shall be issued or levied against property of the
Borrower or any of its Subsidiaries which, together with all other such property
of the Borrower or any of its Subsidiaries subject to other such process,
exceeds in value $1,000,000 in the aggregate;
(k) There shall be at any time any "accumulated funding deficiency,"
as defined in ERISA or in Section 412 of the Code, with respect to any Plan
maintained by the Borrower or any of its Subsidiaries, or to which the Borrower
or any of its Subsidiaries has any liabilities, or any trust created thereunder;
or a trustee shall be appointed by a United States District Court to administer
any such Plan; or PBGC shall institute proceedings to terminate any such Plan;
or the Borrower or any of its Subsidiaries shall incur any liability to PBGC in
connection with the termination of any such Plan; or any Plan or trust created
under any Plan of the Borrower or any of its Subsidiaries shall engage in a
"prohibited transaction" (as such term is defined in Section 406 of ERISA or
Section 4975 of the Code) which would subject any such Plan, any trust created
thereunder, any trustee or administrator thereof, or any party dealing with any
such Plan or trust to the tax or penalty in any material amount on "prohibited
transactions" imposed by Section 502
49
of ERISA or Section 4975 of the Code and, in each case, such event or condition,
together with other such events or conditions, if any, would subject the
Borrower or its Subsidiaries to any tax, liability or penalty in excess of
$1,000,000;
(l) Any event shall occur which has a Materially Adverse Effect;
(m) There shall occur (i) any default under any Indebtedness of the
Borrower or any of its Subsidiaries in an aggregate principal amount exceeding
$1,000,000, (ii) any default under any Interest Hedge Agreement having a
notional principal amount of $1,000,000 or more, or (iii) any default under the
Union Electric Contract;
(n) The FCC shall deliver to the Borrower or any of its Subsidiaries
an order to show cause why an order of revocation should not be issued based
upon any alleged attribution of alien ownership (within the meaning of 47 U.S.C.
Section 310(b) and any interpretation of the FCC thereunder) to the Borrower or
any of its Subsidiaries and such order shall not have been rescinded within
sixty (60) days after such delivery, with respect to any License;
(o) One or more Licenses shall be terminated or revoked such that the
Borrower and its Subsidiaries are no longer able to operate any System or any
portion thereof and retain the revenue received therefrom or any such License
shall fail to be renewed at the stated expiration thereof such that the Borrower
and its Subsidiaries are no longer able to operate the related System or any
portion thereof and retain the revenue received therefrom, except in the event
that the termination or revocation is with respect to any License that is not
material;
(p) Any Security Document or any Note or any other material Loan
Document or any material provision thereof shall at any time and for any reason
be declared by a court of competent jurisdiction, to be null and void, or a
proceeding shall be commenced by the Borrower or any of its Subsidiaries, or by
any governmental authority having jurisdiction over the Borrower or any of its
Subsidiaries, seeking to establish the invalidity or unenforceability thereof
(exclusive of questions of interpretation of any provision thereof), or the
Borrower or any of its Subsidiaries shall deny that it has any liability or
obligation for the payment of principal or interest or other obligations
purported to be created under any Loan Document;
(q) Any Security Document shall for any reason fail or cease to
create a valid and first-priority Lien on or Security Interest in any portion of
the Collateral purported to be covered thereby, subject to any Permitted Lien,
or any such Lien or Security Interest shall cease to be perfected; or
(r) (i) Union Electric shall purchase the Borrower's wireless data
transmission system pursuant to the terms of the Union Electric Contract, or
(ii) the Borrower shall cease to be a wholly-owned Subsidiary of CellNet.
Section 8.2 REMEDIES.
(a) If an Event of Default specified in Section 8.1 (other than an
Event of Default under Section 8.1(h) or Section 8.1(i)) shall have occurred and
shall be continuing, the Administrative Agent, at the request of the Majority
Lenders, shall formally declare that an Event of Default has occurred and (i)
terminate the Commitment and (ii) declare the principal of and interest on the
Loans and the Notes and all other amounts owed to the Lenders and the
Administrative Agent
50
under this Agreement and the Notes and any other Obligations to be forthwith due
and payable without presentment, demand, protest or notice of any kind, all of
which are hereby expressly waived, anything in this Agreement or in the Notes or
any other Loan Document to the contrary notwithstanding, and the Commitment
shall thereupon forthwith terminate and all such amounts shall be immediately
due and payable.
(b) Upon the occurrence and continuance of an Event of Default
specified in Section 8.1(h) or Section 8.1(i), all principal, interest and other
amounts due hereunder and under the Notes, and all other Obligations, shall
thereupon and concurrently therewith become due and payable and the Commitment
shall forthwith terminate and the principal amount of the Loans outstanding
hereunder shall bear interest at the Default Rate, all without any action by the
Administrative Agent, the Lenders or the Majority Lenders or any of them and
without presentment, demand, protest or other notice of any kind, all of which
are expressly waived, anything in this Agreement or in the other Loan Documents
to the contrary notwithstanding.
(c) Upon acceleration of the Notes, as provided in subsection (a) or
(b) of this Section 8.2, the Administrative Agent and the Lenders shall have all
of the post-default rights granted to them, or any of them, under the Loan
Documents and under Applicable Law.
(d) Upon acceleration of the Notes, as provided in subsection (a) or
(b) of this Section 8.2, the Administrative Agent, upon request of the Majority
Lenders, shall have the right to the appointment of a receiver for the
properties and assets of the Borrower and its Subsidiaries, both to operate and
to sell such properties and assets, and the Borrower, for itself and on behalf
of its Subsidiaries, hereby consents to such right and such appointment and
hereby waives any objection the Borrower or any Subsidiary may have thereto or
the right to have a bond or other security posted by the Administrative Agent on
behalf of the Lenders, in connection therewith. The rights of the
Administrative Agent under this Section 8.2(d) shall be subject to its prior
compliance with the Communications Act and the FCC rules and policies
promulgated thereunder to the extent applicable to the exercise of such rights.
(e) The rights and remedies of the Administrative Agent and the
Lenders hereunder shall be cumulative and not exclusive.
Section 8.3 PAYMENTS SUBSEQUENT TO DECLARATION OF EVENT OF DEFAULT.
Subsequent to the acceleration of the Loans under Section 8.2 hereof, payments
and prepayments under this Agreement made to any of the Administrative Agent,
the Lenders or otherwise received by any of such Persons (from realization on
Collateral for the Obligations or otherwise) shall be paid over to the
Administrative Agent (if necessary) and distributed by the Administrative Agent
as follows: FIRST, to the reasonable costs and expenses, if any, incurred in
connection with the collection of such payment or prepayment including, without
limitation, any reasonable costs incurred by the Administrative Agent in
connection with the sale or disposition of any Collateral for the Obligations;
SECOND, to the Lenders and the Administrative Agent for any fees hereunder or
under any of the other Loan Documents then due and payable; THIRD, to the
Lenders pro rata on the basis of their respective unpaid principal amounts
(except as provided in Section 2.2(e)), to the payment of any unpaid interest
which may have accrued on the Obligations; FOURTH, to the Lenders pro rata until
all Advances have been paid in full (and, for purposes of this clause,
obligations under Interest Hedge Agreements with the Lenders or any of them
shall be deemed to be Advances and shall be paid on a pro rata basis with the
Advances); FIFTH, to the Lenders pro rata on the basis of their respective
unpaid amounts, to the payment of any other unpaid
51
Obligations; SIXTH, to damages incurred by the Administrative Agent or any
Lender by reason of any breach hereof or of any other Loan Document; and
SEVENTH, upon satisfaction in full of all Obligations, to the Borrower or as
otherwise required by law. Notwithstanding the foregoing, each Lender may
allocate amounts received by it pursuant to this Section 8.3 in its discretion
to the various Obligations held by it.
ARTICLE 9
THE ADMINISTRATIVE AGENT
Section 9.1 APPOINTMENT AND AUTHORIZATION. Each Lender hereby
irrevocably appoints and authorizes, and hereby agrees that it will require any
transferee of any of its interest in its Loan and in its Note irrevocably to
appoint and authorize, the Administrative Agent to take such actions as its
agent on its behalf and to exercise such powers hereunder and under the Security
Documents as are delegated by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto. Neither the Administrative Agent
nor any of its respective directors, officers, employees or agents shall be
liable for any action taken or omitted to be taken by it or them hereunder or in
connection herewith, except for its or their own gross negligence or willful
misconduct.
Section 9.2 INTEREST HOLDERS. The Administrative Agent may treat each
Lender, or the Person designated in the last notice filed with the
Administrative Agent, whether under Section 11.1, Section 11.5, or otherwise
hereunder, as the holder of all of the interests of such Lender in its Loan and
in its Note until written notice of transfer, signed by such Lender (or the
Person designated in the last notice filed with the Administrative Agent) and by
the Person designated in such written notice of transfer, in form and substance
satisfactory to the Administrative Agent, shall have been filed with the
Administrative Agent.
Section 9.3 CONSULTATION WITH COUNSEL. The Administrative Agent may
consult with Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, Atlanta, Georgia, special
counsel to the Administrative Agent, or with other legal counsel selected by it
with due care and shall not be liable for any action taken or suffered by it in
good faith in consultation with the Majority Lenders and in reasonable reliance
on such consultations.
Section 9.4 DOCUMENTS. The Administrative Agent shall be under no duty
to examine, inquire into, or pass upon the validity, effectiveness or
genuineness of this Agreement, any Note, any other Loan Document, or any other
instrument, document or communication furnished pursuant hereto or in connection
herewith, and the Administrative Agent shall be entitled to assume (absent
knowledge to the contrary) that they are valid, effective and genuine, have been
signed or sent by the proper parties and are what they purport to be.
Section 9.5 ADMINISTRATIVE AGENT AND AFFILIATES. With respect to the
Commitment and its Loan, Toronto Dominion (Texas), Inc. and its Affiliates shall
have the same rights and powers hereunder and under the other Loan Documents as
any other Lender, and the Administrative Agent and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
the Borrower, any of its Subsidiaries or any Affiliates of, or Persons doing
business with, the Borrower, as if they were not affiliated with the
Administrative Agent and without any obligation to account therefor.
52
Section 9.6 RESPONSIBILITY OF THE ADMINISTRATIVE AGENT. The duties and
obligations of the Administrative Agent under this Agreement and the Security
Documents are only those expressly set forth in this Agreement and the Security
Documents. The Administrative Agent shall be entitled to assume that no Default
has occurred and is continuing unless it has actual knowledge, or has been
notified by the Borrower, of such fact, or has been notified by a Lender in
writing that such Lender considers that a Default has occurred and is
continuing, and such Lender shall specify in detail the nature thereof in
writing. The Administrative Agent shall not be liable hereunder for any action
taken or omitted to be taken except for its own gross negligence or willful
misconduct. The Administrative Agent shall provide promptly each Lender with
copies of such documents received from the Borrower as such Lender may
reasonably request.
Section 9.7 SECURITY DOCUMENTS. The Administrative Agent, as
collateral agent hereunder and under the Security Documents, is hereby
authorized to act on behalf of the Lenders, in its own capacity and through
other agents and sub-agents appointed by it with due care, under the Security
Documents, provided that the Administrative Agent shall not agree to the release
of any Collateral, or any property encumbered by any mortgage, pledge or
security interests except in compliance with Section 11.12 hereof. In
connection with its role as secured party with respect to the Collateral
hereunder, the Administrative Agent shall act as collateral agent, for itself
and for the ratable benefit of the Lenders, and such role as administrative
agent shall be disclosed on all appropriate accounts, certificates, filings,
mortgages, and other Collateral documentation.
Section 9.8 ACTION BY THE ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to use its discretion
with respect to exercising or refraining from exercising any rights which may be
vested in it by, and with respect to taking or refraining from taking any action
or actions which it may be able to take under or in respect of, this Agreement,
unless the Administrative Agent shall have been instructed by the Majority
Lenders to exercise or refrain from exercising such rights or to take or refrain
from taking such action; provided that the Administrative Agent shall not
exercise any rights under Section 8.2(a) of this Agreement except upon the
request of the Majority Lenders or all the Lenders, where expressly required by
this Agreement. The Administrative Agent shall incur no liability under or in
respect of this Agreement with respect to anything which it may do or refrain
from doing in the reasonable exercise of its judgment or which may seem to it to
be necessary or desirable in the circumstances for the protection of the
interests of the Lenders, except for its gross negligence or willful misconduct,
or conduct in breach of this Agreement as determined by a final, non-appealable
order of a court having jurisdiction over the subject matter.
(b) The Administrative Agent shall not be liable to the Lenders or to
any Lender in acting or refraining from acting under this Agreement or any other
Loan Document in accordance with the instructions of the Majority Lenders or of
all the Lenders, where expressly required by this Agreement, and any action
taken or failure to act pursuant to such instructions shall be binding on all
Lenders.
Section 9.9 NOTICE OF DEFAULT OR EVENT OF DEFAULT. In the event that
the Administrative Agent or any Lender shall acquire actual knowledge, or shall
have been notified, of any Default (other than through a notice by one party
hereto to all other parties), the Administrative Agent or such Lender shall
promptly notify the Administrative Agent, and the Administrative Agent shall
take such action and assert such rights under this Agreement as the Majority
Lenders or of all the Lenders, where expressly required by this Agreement, shall
request in writing, and the
53
Administrative Agent shall not be subject to any liability by reason of its
acting pursuant to any such request. If the Majority Lenders shall fail to
request the Administrative Agent to take action or to assert rights under this
Agreement in respect of any Default within ten (10) days after their receipt of
the notice of any Default from the Administrative Agent or any Lender, or shall
request inconsistent action with respect to such Default, the Administrative
Agent may, but shall not be required to, take such action and assert such rights
(other than rights under Article 8 hereof) as it deems in its discretion to be
advisable for the protection of the Lenders, except that, if the Majority
Lenders have instructed the Administrative Agent not to take such action or
assert such right, in no event shall the Administrative Agent act contrary to
such instructions.
Section 9.10 RESPONSIBILITY DISCLAIMED. The Administrative Agent shall
not be under any liability or responsibility whatsoever as Administrative Agent:
(a) To the Borrower or any other Person as a consequence of any
failure or delay in performance by or any breach by, any Lender or Lenders of
any of its or their obligations under this Agreement;
(b) To any Lender or Lenders, as a consequence of any failure or
delay in performance by, or any breach by, (i) the Borrower of any of its
obligations under this Agreement or the Notes or any other Loan Document, or
(ii) any Subsidiary of the Borrower or any other obligor under any other Loan
Document; or
(c) To any Lender or Lenders, for any statements, representations or
warranties in this Agreement, or any other document contemplated by this
Agreement or any other Loan Document, or any information provided pursuant to
this Agreement, any other Loan Document, or any other document contemplated by
this Agreement, or for the validity, effectiveness, enforceability or
sufficiency of this Agreement, the Notes, any other Loan Document, or any other
document contemplated by this Agreement.
Section 9.11 INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed by the Borrower) pro rata
according to their respective Commitment Ratios, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including reasonable fees and expenses of experts, agents,
consultants and counsel), or disbursements of any kind or nature whatsoever
which may be imposed on, incurred by or asserted against the Administrative
Agent in any way relating to or arising out of its role as Administrative Agent
under this Agreement, any other Loan Document, or any other document
contemplated by this Agreement or any action taken or omitted by the
Administrative Agent under this Agreement, any other Loan Document, or any other
document contemplated by this Agreement in its role as Administrative Agent,
except that no Lender shall be liable to the Administrative Agent for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses, or disbursements resulting from the gross
negligence or willful misconduct of the Administrative Agent as determined by a
final, non-appealable order of a court having jurisdiction over the subject
matter.
Section 9.12 CREDIT DECISION. Each Lender represents and warrants to
each other Lender and to the Administrative Agent that:
(a) In making its decision to enter into this Agreement and to make
its Advances it has independently taken whatever steps it considers necessary to
evaluate the financial condition and
54
affairs of the Borrower and its Subsidiaries and that it has made an independent
credit judgment, and that it has not relied upon the Administrative Agent or any
other Lender, or information provided by the Administrative Agent (other than
information provided to the Administrative Agent by the Borrower and forwarded
by the Administrative Agent to the Lenders); and
(b) So long as any portion of the Obligations remains outstanding, it
will continue to make its own independent evaluation of the financial condition
and affairs of the Borrower.
Section 9.13 SUCCESSOR ADMINISTRATIVE AGENT. Subject to the
appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving written notice
thereof to the Lenders and the Borrower. Upon any such resignation, the
Majority Lenders shall have the right to appoint a successor Administrative
Agent. If no successor Administrative Agent shall have been so appointed by the
Majority Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Administrative Agent gives notice of resignation, then
the retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent which shall be any Lender or a commercial bank
organized under the laws of the United States of America or any political
subdivision thereof which has combined capital and reserves in excess of
$250,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges, duties and obligations of the retiring Administrative Agent and the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article shall continue
in effect for its benefit in respect of any actions taken or omitted to be taken
by it while it was acting as the Administrative Agent. The resignation of the
Administrative Agent may not take effect until a successor Administrative Agent
is appointed.
Section 9.14 DELEGATION OF DUTIES. The Administrative Agent may
execute any of its respective duties under the Loan Documents by or through
agents or attorneys selected by it using reasonable care, and shall be entitled
to advice of counsel concerning all matters pertaining to such duties.
Section 9.15 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. The
Administrative Agent may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent, its agents,
financial advisors and counsel) and the Lenders allowed in any judicial
proceedings relative to the Borrower, or any of its creditors or property, and
shall be entitled and empowered to collect, receive and distribute any monies,
securities or other property payable or deliverable on any such claims, and any
custodian in any such judicial proceedings is hereby authorized by each Lender
to make such payments to the Administrative Agent and, in the event that the
Administrative Agent shall consent to the making of such payments directly to
the Lenders, to pay to the Administrative Agent any amount due to the
Administrative Agent for the reasonable compensation, expenses, disbursements
and advances of the Administrative Agent, its agents, financial advisors and
counsel, and any other amounts due the Administrative Agent under Section 11.2
hereof. Nothing contained in this Agreement or the other Loan Documents shall
be deemed to authorize the Administrative Agent to authorize or consent to or
accept or adopt on behalf of any Lender any plan of reorganization, arrangement,
adjustment or composition
55
affecting the Notes or the rights of any holder thereof, or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
ARTICLE 10
CHANGE IN CIRCUMSTANCES
AFFECTING EURODOLLAR ADVANCES
Section 10.1 EURODOLLAR BASIS DETERMINATION INADEQUATE OR UNFAIR. If
with respect to any proposed Eurodollar Advance for any Interest Period, the
Administrative Agent determines after consultation with the Lenders that
deposits in Dollars (in the applicable amount) are not being offered to each of
the Lenders in the relevant market for such Interest Period, the Administrative
Agent shall forthwith give notice thereof to the Borrower and the Lenders,
whereupon until the Administrative Agent notifies the Borrower that the
circumstances giving rise to such situation no longer exist, the obligations of
any affected Lender to make such type of Eurodollar Advances shall be suspended.
Section 10.2 ILLEGALITY. If after the date hereof, the adoption of any
Applicable Law, or any change in any Applicable Law (whether adopted before or
after the Agreement Date), or any change in interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
with any directive (whether or not having the force of law) of any such
authority, central bank or comparable agency, shall make it unlawful or
impossible for any Lender to make, maintain or fund either or both types of
Eurodollar Advances, such Lender shall so notify the Administrative Agent, and
the Administrative Agent shall forthwith give notice thereof to the other
Lenders and the Borrower. Upon receipt of such notice, notwithstanding anything
contained in Article 2 hereof, the Borrower shall repay in full the then
outstanding principal amount of each affected Eurodollar Advance of such Lender,
together with accrued interest thereon and any reimbursement required under
Section 2.11 hereof, on either (a) the last day of the then current Interest
Period applicable to such affected Eurodollar Advances if such Lender may
lawfully continue to maintain and fund such Eurodollar Advances to such day or
(b) immediately if such Lender may not lawfully continue to fund and maintain
such affected Eurodollar Advances to such day. Concurrently with repaying each
affected Eurodollar Advance of such Lender, notwithstanding anything contained
in Article 2 or Article 3 hereof, the Borrower may borrow a Base Rate Advance
(or the other type of Eurodollar Advance, if available) from such Lender, and
such Lender shall make such Advance, if so requested, in an amount such that the
outstanding principal amount of the Note held by such Lender shall equal the
outstanding principal amount of such Note immediately prior to such repayment.
Section 10.3 INCREASED COSTS.
(a) If after the date hereof, any Lender becomes aware of the
adoption of any Applicable Law, or any change in any Applicable Law (whether
adopted before or after the Agreement Date), or any interpretation or change in
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof or compliance by any Lender with any directive (whether or not having
the force of law) of any such authority, central bank or comparable agency, and
any such adoption, change or interpretation:
56
(i) shall subject any Lender to any tax, duty or other charge
with respect to its obligation to make Eurodollar Advances, or its
Eurodollar Advances, or shall change the basis of taxation of payments
to any Lender of the principal of or interest on its Eurodollar Advances
or in respect of any other amounts due under this Agreement, in respect
of its Eurodollar Advances or its obligation to make Eurodollar Advances
(except for changes in the rate or method of calculation of tax on the
overall net income of such Lender); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors of
the Federal Reserve System, but excluding any included in an applicable
Eurodollar Reserve Percentage or Domestic Reserve Percentage), special
deposit, capital adequacy, assessment or other requirement or condition
against assets of, deposits with or for the account of, or commitments
or credit extended by, any Lender or shall impose on any Lender or the
London interbank borrowing market or the New York certificate of deposit
market any other condition affecting its obligation to make Eurodollar
Advances or its Eurodollar Advances;
and the result of any of the foregoing is to increase the cost to such Lender of
making or maintaining any such Eurodollar Advances, or to reduce the amount of
any sum received or receivable by such Lender under this Agreement or under its
Note with respect thereto, then within one hundred eighty (180) days of such
increase, such Lender may demand and within five (5) days after demand by such
Lender, the Borrower agrees to pay to such Lender, such additional amount or
amounts as will compensate such Lender for such increased costs. Each Lender
will promptly notify the Borrower and the Administrative Agent of any event of
which it has knowledge, occurring after the date hereof, which will entitle such
Lender to compensation pursuant to this Section 10.3
(b) Any Lender claiming compensation under this Section 10.3 shall
provide the Borrower with a written certificate setting forth the additional
amount or amounts to be paid to it hereunder and calculations therefor in
reasonable detail. Such certificate shall be presumptively correct, absent
manifest error. In determining such amount, such Lender may use any reasonable
averaging and attribution methods. If any Lender demands compensation under
this Section 10.3, the Borrower may at any time, upon at least five (5) Business
Days' prior notice to such Lender, prepay in full the then outstanding affected
Eurodollar Advances of such Lender, together with accrued interest thereon to
the date of prepayment, along with any reimbursement required under Section 2.11
hereof. Concurrently with prepaying such Eurodollar Advances, the Borrower may
borrow a Base Rate Advance from such Lender, and such Lender shall, if so
requested, make such Advance in an amount such that the outstanding principal
amount of the Note held by such Lender shall equal the outstanding principal
amount of such Note immediately prior to such prepayment.
Section 10.4 EFFECT ON OTHER ADVANCES. If notice has been given
pursuant to Section 10.1, 10.2 or 10.3 suspending the obligation of any Lender
to make Eurodollar Advances, or requiring Eurodollar Advances of any Lender to
be repaid or prepaid, then, unless and until such Lender notifies the Borrower
that the circumstances giving rise to such repayment no longer apply, all
Advances which would otherwise be made by such Lender as Eurodollar Advances
shall, at the option of the Borrower, be made instead as Base Rate Advances.
57
ARTICLE 11
MISCELLANEOUS
Section 11.1 NOTICES.
(a) Unless otherwise specifically provided herein, all notices and
other communications under this Agreement shall be in writing and shall be
deemed to have been given three (3) days after deposit in the mail, designated
as certified mail, return receipt requested, postage-prepaid, or one (1) day
after being entrusted to a reputable commercial overnight delivery service, or
when sent by telecopy addressed to the party to which such notice is directed at
its address determined as provided in this Section 11.1, except that notices
under Article 2 shall be effective only upon receipt. All notices and other
communications under this Agreement shall be given to the parties hereto at the
following addresses:
(i) If to the Borrower, to it at:
CellNet Data Services (SL), Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) If to the Administrative Agent, to it at:
Toronto Dominion (Texas), Inc.
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Manager, Agency
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
The Toronto-Dominion Bank
USA Division
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Managing Director, Communications Finance
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
58
and to:
Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
(iii) If to the Lenders, to them at the addresses set forth
beside their names on SCHEDULE 1.
Copies shall be provided to Persons other than parties hereto only in the case
of notices under Article 8 hereof.
(b) Any party hereto may change the address to which notices shall be
directed under this Section 11.1 by giving ten (10) days' written notice of such
change to the other parties.
Section 11.2 EXPENSES. The Borrower will promptly pay, or reimburse:
(a) all reasonable out-of-pocket expenses of the Administrative Agent
in connection with the preparation, negotiation, execution and delivery of this
Agreement and the other Loan Documents, and the transactions contemplated
hereunder and thereunder and the making of the initial Advance hereunder
(whether or not such Advance is made), including, but not limited to, the fees
and disbursements of Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, special counsel for
the Administrative Agent and its Affiliates;
(b) all reasonable out-of-pocket expenses of the Administrative Agent
in connection with the administration of the transactions contemplated in this
Agreement or the other Loan Documents, the restructuring and "work out" of such
transactions, and the preparation, negotiation, execution and delivery of any
waiver, amendment or consent by the Administrative Agent and the Lenders
relating to this Agreement or the other Loan Documents, including, but not
limited to, the fees and disbursements of any experts, agents or consultants and
of special counsel for the Administrative Agent; and
(c) all out-of-pocket costs and expenses of the Administrative Agent
and each Lender of obtaining performance under this Agreement or the other Loan
Documents and all out-of-pocket costs and expenses of collection of the
Administrative Agent and each Lender if an Event of Default occurs in the
payment of the Notes, which in each case shall include reasonable fees and
out-of-pocket expenses of counsel for the Administrative Agent and each Lender.
Section 11.3 WAIVERS. The rights and remedies of the Administrative
Agent and the Lenders under this Agreement and the other Loan Documents shall be
cumulative and not exclusive of any rights or remedies which they would
otherwise have. No failure or delay by the Administrative Agent or the Lenders,
or any of them, in exercising any right, shall operate as a waiver of such
right. The Administrative Agent and the Lenders expressly reserve the right to
require strict compliance with the terms of this Agreement in connection with
any future funding of a request for an Advance. In the event the Lenders decide
to fund an Advance at a time when the Borrower is not in strict compliance with
the terms of this Agreement, such decision by the Lenders shall not be deemed to
constitute an undertaking by the Lenders to fund any further
59
Advances or preclude the Lenders and the Administrative Agent from exercising
any rights available under the Loan Documents or at law or equity. Any waiver
or indulgence granted by the Administrative Agent, the Lenders or the Majority
Lenders shall not constitute a modification of this Agreement, except to the
extent expressly provided in such waiver or indulgence, or constitute a course
of dealing at variance with the terms of this Agreement such as to require
further notice of their intent to require strict adherence to the terms of this
Agreement in the future.
Section 11.4 SET-OFF. In addition to any rights now or hereafter
granted under Applicable Law and not by way of limitation of any such rights,
upon the occurrence of an Event of Default and during the continuation thereof,
the Administrative Agent and the Lenders are hereby authorized by the Borrower
at any time or from time to time, without notice to the Borrower or to any other
Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special, time or
demand, including, but not limited to, Indebtedness evidenced by certificates of
deposit, in each case whether matured or unmatured) and any other Indebtedness
at any time held or owing by any Lender or the Administrative Agent to or for
the credit or the account of the Borrower or any of its Subsidiaries against and
on account of the Obligations which are then due and payable irrespective of
whether (a) any Lender or the Administrative Agent shall have made any demand
hereunder or (b) the Administrative Agent shall have declared the principal of
and interest on the Loans and other amounts due hereunder to be due and payable
as permitted by Section 8.2 and although such Obligations or any of them, shall
be contingent or unmatured. Upon direction by the Administrative Agent with the
consent of the Majority Lenders, each Lender holding deposits of the Borrower or
any of its Subsidiaries shall exercise its set-off rights as so directed.
Section 11.5 ASSIGNMENT.
(a) The Borrower may not assign or transfer any of its rights nor
delegate any of its obligations hereunder or under the Notes without the prior
written consent of each Lender.
(b) Each of the Lenders may at any time enter into participation or
assignment agreements with one or more other Lenders or other Persons pursuant
to which each Lender may sell participations in or assign its interests under
this Agreement and the other Loan Documents, provided, that unless otherwise
agreed to by the Borrower and the Administrative Agent, (i) all assignments and
participations (other than assignments and participations described in clause
(ii) hereof) shall be in minimum principal amounts of Five Million Dollars
($5,000,000), (ii) each Lender may sell assignments and participations of up to
one hundred percent (100%) of its interests hereunder to (A) one or more
affiliates of such Lender, (B) any other Lender, or (C) any Federal Reserve Bank
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any Operating Circular issued by such Federal Reserve
Bank, provided, that no such assignment described in clause (C) shall relieve
such Lender from its obligations hereunder, and (iii) all assignments (other
than assignments described in clause (ii) hereof) and participations hereunder
shall be subject to the following additional terms and conditions:
(i) No assignment shall be sold without the prior
written consent of the Administrative Agent and (so long as no Event of
Default exists hereunder) the prior written consent(s) of the Borrower,
which consents shall not be unreasonably withheld or delayed.
60
(ii) Any Person purchasing a participation or an
assignment of the Loans from any Lender shall be required to represent
and warrant that its purchase shall not constitute a "prohibited
transaction" (as defined in Section 4.1(m) hereof).
(iii) The Borrower, the Lenders, and the Administrative
Agent agree that assignments permitted hereunder (including the
assignment of any Advance or portion thereof) may be made with all
voting rights, and shall be made pursuant to an Assignment and
Assumption Agreement in substantially the form attached hereto as
EXHIBIT S. An administrative fee of $3,500 shall be payable to the
Administrative Agent by the assigning Lender at the time of any
assignment hereunder.
(iv) No assignment, participation or other transfer of
any rights hereunder or under the Notes shall be effected that would
result in any interest requiring registration under the Securities Act
of 1933, as amended, or qualification under any state securities law.
(v) Each Lender agrees that (x) no participation
agreement shall confer any rights under this Agreement or any other Loan
Document to any purchaser thereof, (y) no Person to which a
participation is issued shall have any right to exercise or enforce any
rights under this Agreement or under any other Loan Document, and (z)
any participation agreement permitted hereunder shall (a) (subject to
clause (vi) of this Section 11.5(b)) expressly provide that the issuer
thereof will at all times retain the right to vote or take any other
actions with respect to its interests hereunder for the full Commitment
Ratio assigned to such issuing Lender hereunder, both before and after
the occurrence of any Default, and (b) contain an express
representation by the participant that it is purchasing such
participation for its own account and not as agent or trustee for any
Plan or trust.
(vi) The participation may also provide that the
issuing Lender will not, without the consent of the participant, agree
to any modification, amendment or waiver of this Agreement which would
otherwise require unanimous consent of all of the Lenders.
(vii) The amount, terms and conditions of any
participations or assignments shall be as set forth in the participation
or assignment agreement between the issuing or assigning Lender and the
Person purchasing such participation or assignment, except as provided
in the Assignment and Assumption Agreement, and neither the Borrower,
the Administrative Agent, nor any other Lender shall have any
responsibility or obligations with respect thereto, or to any Person to
whom such participation or assignment may be issued.
(viii) No such assignment may be made to any Lender or
other financial institution (x) with respect to which a receiver or
conservator (including, without limitation, the Federal Deposit
Insurance Corporation, the Resolution Trust Company or the Office of
Thrift Supervision) has been appointed or (y) that is not "adequately
capitalized" (as such term is defined in Section 131(b)(1)(B) of the
Federal Deposit Insurance Corporation Improvement Act as in effect on
the Agreement Date.
(c) Except specifically set forth in Section 11.5(b) hereof, nothing
in this Agreement or the Notes, expressed or implied, is intended to or shall
confer on any Person other than the respective parties hereto and thereto and
their successors and assignees permitted hereunder and
61
thereunder any benefit or any legal or equitable right, remedy or other claim
under this Agreement or the Notes.
Section 11.6 ACCOUNTING PRINCIPLES. Except as set forth in the
following sentence, references in this Agreement to GAAP shall be to such
principles as in effect from time to time, and all accounting terms used herein
without definition shall be used as defined under GAAP. All references to
Operating Cash Flow, Total Debt, Debt Service, and other such terms shall be
deemed to refer to such items of the Borrower and its Subsidiaries on a
consolidated basis, consistently applied, unless otherwise indicated herein.
Section 11.7 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such separate counterparts shall together constitute but one and the same
instrument.
Section 11.8 GOVERNING LAW. This Agreement and the Notes shall be
construed in accordance with and governed by the internal laws of the State of
New York applicable to agreements made and to be performed in New York. If any
action or proceeding shall be brought by the Administrative Agent or any Lender
in order to enforce any right or remedy under this Agreement or under any Note,
the Borrower hereby consents and will, and the Borrower will cause each
Subsidiary to, submit to the jurisdiction of any state or federal court of
competent jurisdiction sitting within the area comprising the Southern District
of New York on the date of this Agreement. The Borrower, for itself and on
behalf of its Subsidiaries, hereby agrees that service of the summons and
complaint and all other process which may be served in any such suit, action or
proceeding may be effected by mailing by registered mail a copy of such process
to the offices of the Borrower at the address given in Section 11.1 hereof and
that personal service of process shall not be required. Nothing herein shall be
construed to prohibit service of process by any other method permitted by law or
the bringing of any suit, action or proceeding in any other jurisdiction. The
Borrower agrees that final judgment in such suit, action or proceeding shall be
conclusive and may be enforced in any other jurisdiction by suit on the judgment
or in any other manner provided by Applicable Law.
Section 11.9 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof in that jurisdiction or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 11.10 INTEREST.
(a) In no event shall the amount of interest due or payable hereunder
or under the Notes exceed the maximum rate of interest allowed by Applicable
Law, and in the event any such payment is inadvertently made by the Borrower or
inadvertently received by any Lender, then such excess sum shall be credited as
a payment of principal, unless the Borrower shall notify the Administrative
Agent or such Lender in writing that it elects to have such excess returned
forthwith. It is the express intent hereof that the Borrower not pay and the
Lenders not receive, directly or indirectly in any manner whatsoever, interest
in excess of that which may legally be paid by the Borrower under Applicable
Law.
(b) Notwithstanding the use by the Lenders of the Base Rate, the
Federal Funds Rate, and the Eurodollar Rate as reference rates for the
determination of interest on the Loans, the Lenders
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shall be under no obligation to obtain funds from any particular source in order
to charge interest to the Borrower at interest rates related to such reference
rates.
Section 11.11 TABLE OF CONTENTS AND HEADINGS. The Table of Contents
and the headings of the various subdivisions used in this Agreement are for
convenience only and shall not in any way modify or amend any of the terms or
provisions hereof, nor be used in connection with the interpretation of any
provision hereof.
Section 11.12 AMENDMENT AND WAIVER. Neither this Agreement nor any
other Loan Document nor any term hereof or thereof may be amended orally, nor
may any provision hereof or thereof be waived orally but only by an instrument
in writing signed by (or, in the case of Security Documents executed by the
Administrative Agent for itself and on behalf of the Lenders, signed by the
Administrative Agent and approved by) the Majority Lenders and, in the case of
an amendment, by the Borrower, except that in the event of (a) any increase in
the amount of the Commitment (other than the issuance of additional loans under
the Additional Facility Commitment as provided herein), (b) any delay or
extension in the terms of repayment of the Loans provided in Section 2.7 hereof,
(c) any reduction in principal, interest or fees due hereunder or postponement
of the payment thereof, (d) any release of any Collateral for the Loans other
than in connection with a sale or disposition otherwise permitted hereunder, or
any failure to take Collateral to which the Lenders are otherwise entitled to
hereunder, (e) any waiver of any Default due to the failure by the Borrower to
pay any sum due to any of the Lenders hereunder, (f) any release of any Guaranty
of all or any portion of the Obligations, except in connection with a merger,
sale or other disposition otherwise permitted hereunder, or (g) any amendment of
this Section 11.12, or of the definition of Majority Lenders, or of any portion
of Sections 2.10, 2.12, 5.11 or Article 10 as they relate to the relative
priority of payment among the Obligations, or any other provision of this
Agreement or any of the other Loan Documents specifically requiring the consent
or approval of each of the Lenders, any amendment or waiver or consent may be
made only by an instrument in writing signed by (or, in the case of Security
Documents executed by the Administrative Agent for itself and on behalf of the
Lenders, signed by the Administrative Agent and approved by) each of the Lenders
and, in the case of an amendment, by the Borrower. Any amendment to any
provision hereunder governing the rights, obligations, or liabilities of the
Administrative Agent in its capacity as such, may be made only by an instrument
in writing signed by the Administrative Agent and by each of the Lenders.
Section 11.13 ENTIRE AGREEMENT. Except as otherwise expressly provided
herein, this Agreement and the other documents described or contemplated herein
embody the entire agreement and understanding among the parties hereto and
thereto and supersede all prior agreements and understandings relating to the
subject matter hereof and thereof.
Section 11.14 OTHER RELATIONSHIPS. No relationship created hereunder
or under any other Loan Document shall in any way affect the ability of the
Administrative Agent or its Affiliates and each Lender or its respective
Affiliates to enter into or maintain business relationships with the Borrower or
any of its Affiliates beyond the relationships specifically contemplated by this
Agreement and the other Loan Documents.
Section 11.15 DIRECTLY OR INDIRECTLY. If any provision in this
Agreement refers to any action taken or to be taken by any Person, or which such
Person is prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such Person, whether or not
expressly specified in such provision.
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Section 11.16 RELIANCE ON AND SURVIVAL OF VARIOUS PROVISIONS. All
covenants, agreements, statements, representations and warranties made herein or
in any certificate delivered pursuant hereto (a) shall be deemed to have been
relied upon by the Administrative Agent and each of the Lenders notwithstanding
any investigation heretofore or hereafter made by them, and (b) shall survive
the execution and delivery of the Notes and shall continue in full force and
effect so long as any Note is outstanding and unpaid. Any right to
indemnification hereunder, including, without limitation, rights pursuant to
Sections 2.11, 2.13, 5.11, 10.3 and 11.2 hereof, shall survive the termination
of this Agreement and the payment and performance of all other Obligations.
Section 11.17 CONFIDENTIALITY. Each Lender agrees to protect the
confidentiality of confidential information regarding the Borrower and its
Subsidiaries, to prevent unauthorized disclosures, to take reasonable steps
necessary to ensure that the information is received only by those who have a
need to know, and to hold all non-public, proprietary or confidential
information (which has been identified as such by the Borrower) obtained
pursuant to this Agreement in accordance with its customary procedures for
handling confidential information of this nature and in accordance with safe and
sound banking practices; however, the Lenders may make disclosure of any such
information to their examiners, outside auditors, and counsel in connection with
this Agreement or as reasonably required by any proposed syndicate member or any
proposed transferee or participant in connection with the contemplated transfer
of any Note or participation therein so long as such Person agrees to be bound
by this Section 11.17 or as required or requested by any governmental authority
or representative thereof or in connection with the enforcement hereof or of any
Loan Document or related document or pursuant to legal process or with respect
to any litigation between or among the Borrower and any of the Lenders. In no
event shall any Lender be obligated or required to return any materials
furnished to it by the Borrower. The foregoing provisions shall not apply to a
Lender with respect to information that (i) is or becomes generally available to
the public (other than through such Lender), (ii) is already in the possession
of such Lender on a nonconfidential basis, (iii) comes into the possession of
such Lender from a Person other than the Borrower or an Affiliate of the
Borrower in a manner not known to such Lender to involve a breach of a duty of
confidentiality owing to the Borrower, or (iv) must be disclosed as required by
law, any court of competent jurisdiction, or bank regulator.
ARTICLE 12
WAIVER OF JURY TRIAL
Section 12.1 WAIVER OF JURY TRIAL. THE BORROWER, FOR ITSELF AND ON
BEHALF OF ITS SUBSIDIARIES, AND THE ADMINISTRATIVE AGENT AND EACH OF THE
LENDERS, HEREBY AGREE TO WAIVE AND HEREBY WAIVE THE RIGHT TO A TRIAL BY JURY IN
ANY COURT AND IN ANY ACTION OR PROCEEDING OF ANY TYPE IN WHICH THE BORROWER, ANY
OF THE BORROWER'S SUBSIDIARIES, ANY OF THE LENDERS, OR THE ADMINISTRATIVE AGENT,
OR ANY OF THEIR RESPECTIVE SUCCESSORS OR ASSIGNS, IS A PARTY, AS TO ALL MATTERS
AND THINGS ARISING DIRECTLY OR INDIRECTLY OUT OF THIS AGREEMENT, ANY OF THE
NOTES OR THE OTHER LOAN DOCUMENTS.
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IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first appearing above.
BORROWER: CELLNET DATA SERVICES (SL), INC.
By:________________________________
Title:_____________________________
ADMINISTRATIVE
AGENT: TORONTO DOMINION (TEXAS), INC.
By:________________________________
Title:_____________________________
LEAD ARRANGER AND
SYNDICATION AGENT: TD SECURITIES (USA), INC.
By:________________________________
Title:_____________________________
LENDERS: TORONTO DOMINION (TEXAS), INC.
By:________________________________
Title:_____________________________
THE BANK OF NEW YORK
By:________________________________
Title:_____________________________
FIRST HAWAIIAN BANK
By:________________________
Title:_____________________
CO-AGENT: THE BANK OF NEW YORK
By:________________________
Title:_____________________