EXHIBIT 10.49
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$125,000,000
LOAN AGREEMENT
among
CLEARWIRE CORPORATION,
as Borrower,
The Several Lenders from Time to Time Parties Hereto,
JPMORGAN CHASE BANK, N.A.,
as Documentation Agent,
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED,
as Syndication Agent,
and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.,
as Administrative Agent
Dated as of August 21, 2006
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.,
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED and
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.,
as Joint Lead Arrangers and Joint Bookrunners
TABLE OF CONTENTS
Page
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SECTION 1. DEFINITIONS................................................... 1
1.1 Defined Terms................................................... 1
1.2 Other Definitional Provisions................................... 23
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS............................... 23
2.1 Commitments..................................................... 23
2.2 Procedure for Borrowing......................................... 24
2.3 Repayment of Loans.............................................. 24
2.4 Optional Prepayments............................................ 24
2.5 Mandatory Prepayments........................................... 24
2.6 Conversion and Continuation Options............................. 25
2.7 Limitations on Eurodollar Tranches.............................. 25
2.8 Interest Rates and Payment Dates................................ 25
2.9 Computation of Interest and Fees................................ 26
2.10 Inability to Determine Interest Rate............................ 26
2.11 Pro Rata Treatment and Payments................................. 27
2.12 Requirements of Law............................................. 28
2.13 Taxes........................................................... 29
2.14 Indemnity....................................................... 31
2.15 Change of Lending Office........................................ 31
2.16 Replacement of Lenders.......................................... 31
SECTION 3. [RESERVED].................................................... 32
SECTION 4. REPRESENTATIONS AND WARRANTIES................................ 32
4.1 Financial Condition............................................. 32
4.2 No Change....................................................... 32
4.3 Existence; Compliance with Law.................................. 32
4.4 Power; Authorization; Enforceable Obligations................... 32
4.5 No Legal Bar.................................................... 33
4.6 Litigation...................................................... 33
4.7 No Default...................................................... 33
4.8 Ownership of Property; Liens.................................... 33
4.9 Intellectual Property........................................... 33
4.10 Taxes........................................................... 33
4.11 Federal Regulations............................................. 34
4.12 Labor Matters................................................... 34
4.13 ERISA........................................................... 34
4.14 Investment Company Act; Other Regulations....................... 34
4.15 Subsidiaries.................................................... 34
4.16 Use of Proceeds................................................. 34
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4.17 Environmental Matters........................................... 35
4.18 Accuracy of Information, etc.................................... 35
4.19 Security Documents.............................................. 36
4.20 Solvency........................................................ 36
SECTION 5. CONDITIONS PRECEDENT.......................................... 36
SECTION 6. AFFIRMATIVE COVENANTS......................................... 38
6.1 Financial Statements............................................ 38
6.2 Certificates; Other Information................................. 38
6.3 Payment of Obligations.......................................... 39
6.4 Maintenance of Existence; Compliance............................ 39
6.5 Maintenance of Property; Insurance.............................. 40
6.6 Inspection of Property; Books and Records; Discussions.......... 40
6.7 Notices......................................................... 40
6.8 Environmental Laws.............................................. 41
6.9 Additional Collateral, etc...................................... 41
SECTION 7. NEGATIVE COVENANTS............................................ 43
7.1 Indebtedness.................................................... 43
7.2 Limitation on Liens............................................. 44
7.3 The Spectrum Entities........................................... 45
7.4 Asset Sales of Spectrum Entities................................ 45
7.5 Asset Sales of Non-Spectrum Entities............................ 46
7.6 Restricted Payments............................................. 47
7.7 Mergers, Consolidation, etc..................................... 49
7.8 Transactions With Affiliates.................................... 51
7.9 Limitation On Sale and Leaseback Transactions................... 52
7.10 Designation of Restricted and Unrestricted Subsidiaries......... 53
7.11 ESC Compliance.................................................. 54
7.12 Stay, Extension ad Usury Laws................................... 55
7.13 Business Activities............................................. 55
7.14 Swap Agreements................................................. 55
7.15 Changes in Fiscal Periods....................................... 56
7.16 Amendments to Certain Documents................................. 56
7.17 Activities of Holders of Designated Spectrum.................... 56
SECTION 8. EVENTS OF DEFAULT............................................. 56
SECTION 9. THE AGENTS.................................................... 58
9.1 Appointment..................................................... 58
9.2 Delegation of Duties............................................ 58
9.3 Exculpatory Provisions.......................................... 58
9.4 Reliance by Administrative Agent................................ 59
9.5 Notice of Default............................................... 59
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9.6 Non-Reliance on Agents and Other Lenders........................ 59
9.7 Indemnification................................................. 60
9.8 Agent in Its Individual Capacity................................ 60
9.9 Successor Administrative Agent.................................. 60
9.10 Documentation Agent and Syndication Agent....................... 61
SECTION 10. MISCELLANEOUS................................................ 61
10.1 Amendments and Waivers.......................................... 61
10.2 Notices......................................................... 62
10.3 No Waiver; Cumulative Remedies.................................. 63
10.4 Survival of Representations and Warranties...................... 63
10.5 Payment of Expenses and Taxes................................... 63
10.6 Successors and Assigns; Participations and Assignments.......... 64
10.7 Adjustments; Set-off............................................ 67
10.8 Counterparts.................................................... 67
10.9 Severability.................................................... 67
10.10 Integration..................................................... 67
10.11 Governing Law................................................... 67
10.12 Submission To Jurisdiction; Waivers............................. 68
10.13 Acknowledgements................................................ 68
10.14 Releases of Guarantees and Liens................................ 68
10.15 Confidentiality................................................. 69
10.16 Waivers of Jury Trial........................................... 69
SCHEDULES:
1.1A Commitments
1.1B Existing Liens
1.1C Designated Spectrum
4.4 Consents, Authorizations, Filings and Notices
4.9 Intellectual Property
4.15 Subsidiaries
4.19 UCC Filing Jurisdictions
7.1(d) Existing Indebtedness
EXHIBITS:
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D Form of Assignment and Assumption
E-1 Form of Legal Opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
E-2 Form of Legal Opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
F Form of Exemption Certificate
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CREDIT AGREEMENT (this "Agreement"), dated as of August 21, 2006,
among CLEARWIRE CORPORATION, a Delaware corporation (the "Borrower"), the
several banks and other financial institutions or entities from time to time
parties to this Agreement (the "Lenders"), JPMORGAN CHASE BANK, N.A., as
documentation agent (in such capacity, the "Documentation Agent"), ▇▇▇▇▇▇▇
LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED, as syndication agent (in such
capacity, the "Syndication Agent"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC., as
administrative agent.
The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.
"ABR": for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2
of 1%. For purposes hereof: "Prime Rate" shall mean the rate of interest per
annum published by The Wall Street Journal from time to time as the "prime
rate". Any change in the ABR due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively.
"ABR Loans": Loans the rate of interest applicable to which is based
upon the ABR.
"Administrative Agent": ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc., together
with its affiliates, as the arranger of the Commitments and as the
administrative agent for the Lenders under this Agreement and the other Loan
Documents, together with any of its successors.
"Affiliate": with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Affiliate Transaction": as defined in Section 7.8.
"Agents": the collective reference to the Syndication Agent, the
Documentation Agent and the Administrative Agent.
"Agreement": as defined in the preamble hereto.
"Applicable Margin": (a) for ABR Loans, 5.75% per annum and (b) for
Eurodollar Loans, 6.75% per annum; provided, that (i) on the date (the "Step-Up
Date") occurring six months after the Closing Date, if a Specified Equity
Shortfall then exists, the Applicable Margin (both for ABR Loans and for
Eurodollar Loans) shall be temporarily increased by 0.75% per annum, with such
rate increase being retroactively effective for the period commencing on the
Closing Date and ending on the Step-Up Date, (ii) on the first anniversary of
the Closing Date, if a Specified Equity Shortfall then exists, the Applicable
Margin (both for ABR Loans and for Eurodollar Loans) shall be permanently
increased by 0.75% per annum (it being understood that such increase shall be
separate from, and not in addition to,
any increase pursuant to the preceding clause (i)), with such rate increase
taking retroactive effect as of the date immediately following the Step-Up Date
and (iii) the Applicable Margin (for both ABR Loans and Eurodollar Loans), shall
be permanently increased (such increase being in addition to and not in lieu of
any permanent increase occurring pursuant to the preceding clause (ii)) by 0.50%
per annum on the date that occurs 18 months after the Closing Date in the event
that a Qualified IPO shall not have occurred on or prior to such date.
"Approved Fund": as defined in Section 10.6(b).
"Asset Sale":
(1) the sale, lease, conveyance or other disposition or transfer of any
assets (including FCC License Rights) by the Borrower or any
Restricted Subsidiary; and
(2) the issuance (including in connection with any merger or
consolidation) or sale, transfer, conveyance or other disposition of
Capital Stock of any Restricted Subsidiary (other than directors'
qualifying shares and shares issued to foreign nationals to the extent
required by applicable law).
Notwithstanding the preceding, the following items shall be deemed not
to be Asset Sales:
(1) a transfer of Capital Stock between or among the Spectrum Entities in
accordance with Section 7.3 or a transfer of assets of the Spectrum
Entities between or among the Spectrum Entities;
(2) a transfer of assets (including Capital Stock, other than Capital
Stock of any Spectrum Entity) between or among the Loan Parties (other
than the Spectrum Entities) or between or among the Restricted
Subsidiaries of the Borrower (other than the Spectrum Entities) that
are not Loan Parties;
(3) the sale or lease of equipment, inventory, accounts receivable or
other assets (other than FCC License Rights) in the ordinary course of
business;
(4) dispositions of accounts receivable in connection with the compromise,
settlement or collection thereof in the ordinary course of business or
in bankruptcy or similar proceedings;
(5) a Restricted Payment or Investment that is permitted by Section 7.6;
(6) any sale or disposition of any property or equipment that has become
damaged, worn out or obsolete;
(7) the creation of a Permitted Lien;
(8) non-exclusive licenses of intellectual property in the ordinary course
of business that could not reasonably be expected to have a material
adverse effect on the value of the Collateral or the ability of the
Administrative Agent or the Lenders to realize the benefits of, and
intended to be afforded by, the Collateral;
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(9) any disposition of Designated Noncash Consideration; provided that
such disposition is treated as an increase in the amount of Net
Proceeds of the Asset Sale that resulted in such Designated Noncash
Consideration and is applied as required under Section 2.5;
(10) any foreclosure (subject to any intercreditor or subordination
arrangement between such lienholder and the Administrative Agent on
behalf of the Lenders) upon any assets of Restricted Subsidiaries
pursuant to the terms of a Permitted Lien; provided that such
foreclosure does not otherwise constitute a Default under this
Agreement;
(11) the sale of all or substantially all of the Capital Stock or property
of NextNet and its Subsidiaries to Motorola;
(12) the disposition of Capital Stock of any Unrestricted Subsidiary; and
(13) the transfer of FCC License Rights held by Spectrum Holdings that is
not Designated Spectrum to any Subsidiary;
"Assignee": as defined in Section 10.6(b).
"Assignment and Assumption": an Assignment and Assumption,
substantially in the form of Exhibit D.
"Attributable Debt": in respect of a Sale and Leaseback Transaction,
at the time of determination, the present value of the obligation of the lessee
for net rental payments during the remaining term of the lease included in such
Sale and Leaseback Transaction, including any period for which such lease has
been extended or may, at the option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"Benefitted Lender": as defined in Section 10.7(a).
"Board": the Board of Governors of the Federal Reserve System of the
United States (or any successor).
"Bankruptcy Law": Title 11 of the United States Code (or any successor
thereto) or any similar federal or state law for the relief of debtors.
"Board of Directors": either the board of directors of the Borrower or
any committee of the Board of Directors authorized to act for it with respect to
this Agreement.
"Board Resolution": a resolution certified by the Secretary or an
Assistant Secretary of the Borrower to have been duly adopted by the Board of
Directors of the Borrower and to be in full force and effect on the date of such
certification.
"Borrower": as defined in the preamble hereto.
"Borrowing Date": any Business Day specified by the Borrower as the
date on which the Borrower requests the Lenders to make the Loans hereunder.
"Business": as defined in Section 4.17(b).
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"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close, provided, that with respect to notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, such day is
also a day for trading by and between banks in Dollar deposits in the interbank
eurodollar market.
"Capital Lease Obligation": at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at that time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock": any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.
"Cash Equivalents":
(1) (A) U.S. dollars and (B) to the extent received in the ordinary course
of business or exchanged into U.S. Dollars within 180 days, Euros,
Pounds Sterling, Japanese Yen and any other foreign currency
acceptable to the Administrative Agent in its sole discretion;
(2) securities issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is
pledged in support thereof), maturing, unless such securities are
deposited to defease any Indebtedness, not more than one year from the
date of acquisition;
(3) certificates of deposit and eurodollar time deposits with maturities
of one year or less from the date of acquisition, bankers' acceptances
with maturities not exceeding one year and overnight bank deposits, in
each case, with any domestic commercial bank having capital and
surplus in excess of $500,000,000 and a rating at the time of
acquisition thereof of P-1 or better from ▇▇▇▇▇'▇ Investors Service,
Inc. or A-1 or better from Standard & Poor's Rating Services;
(4) securities issued and fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political
subdivision or taxing authority thereof, rated at least "A" by ▇▇▇▇▇'▇
Investors Service, Inc. or Standard & Poor's Rating Services and
having maturities of not more than one year from the date of
acquisition; and
(5) money market funds denominated in U.S. dollars at least 95% of the
assets of which constitute Cash Equivalents of the kinds described in
clauses (1) through (4) of this definition.
"Change of Control": with respect to the Borrower or any successor
entity that is subject to the terms of this Agreement, the occurrence of any of
the following events:
(1) any sale, lease, exchange or other transfer (in one transaction or
a series of related transactions) of all or substantially all of the
Borrower's assets to any person or group of related persons (other than to
any of the Borrower's Wholly Owned Subsidiaries);
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(2) the approval by the holders of the Borrower's Capital Stock of any
plan or proposal for liquidation or dissolution;
(3) any person or group (other than a person or group of persons
comprised solely of shareholders of the Borrower as of the Reference Date
or their Affiliates) shall become the beneficial owner, directly or
indirectly, of shares representing more than 50% of the aggregate voting
power represented by the issued and outstanding Voting Stock of the
Borrower;
(4) prior to a Qualified IPO and other than as results solely from a
transaction that results in a Qualified IPO, either (i) ▇▇▇▇▇ ▇▇▇▇▇ and any
▇▇▇▇▇ Person, taken as a whole, directly or indirectly beneficially owns
less than 50% of the total outstanding Class B Common Stock or (ii) ▇▇▇▇▇
▇▇▇▇▇ and any ▇▇▇▇▇ Person, taken as a whole, directly or indirectly
beneficially owns less than 66 2/3% of the amount of the total outstanding
Class B Common Stock owned by such persons as of the Reference Date; or
(5) prior to a Qualified IPO and other than as results solely from a
transaction that results in a Qualified IPO, any consolidation or merger by
the Borrower where persons who are beneficial owners of the Borrower's
shares of Voting Stock immediately prior to such transaction no longer own
at least a majority of the total voting power of the continuing or
surviving corporation or entity.
For purposes of this definition of Change of Control:
"person" or "group" have the meanings given to them for purposes of
Sections 13(d) and 14(d) of the Exchange Act or any successor provisions, and
the term "group" includes any group acting for the purpose of acquiring, holding
or disposing of securities within the meaning of Rule 13d-5(b)(1) under the
Exchange Act, or any successor provision;
a "beneficial owner" will be determined in accordance with Rule 13d-3
under the Exchange Act, as in effect on the Reference Date, except that the
number of shares of Voting Stock of the Borrower will be deemed to include all
outstanding shares of Voting Stock of the Borrower and unissued shares deemed to
be held by the "person" or "group" or other person with respect to which the
determination is being made, but shall not include any unissued shares deemed to
be held by all other persons;
"beneficially owned" has a meaning correlative to that of beneficial
owner; and
"unissued shares" means shares of Voting Stock not outstanding that
are subject to options, warrants, rights to purchase or conversion privileges
exercisable within 60 days of the date of determination of a Change of Control.
"Class A Common Stock": the Class A common stock of the Borrower,
$0.0001 par value per share, as it existed on the Reference Date and any shares
of any class or classes of capital stock of the Borrower resulting from any
reclassification or reclassifications thereof and which have no preference in
respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding-up of the Borrower and which are
not subject to redemption by the Borrower.
"Class B Common Stock": the Class B common stock of the Borrower,
$0.0001 par value per share, as it existed on the Reference Date and any shares
of any class or classes of capital stock of the Borrower resulting from any
reclassification or reclassifications thereof and which have no
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preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding-up of the Borrower
and which are not subject to redemption by the Borrower.
"Clearwire International": Clearwire International, LLC, a Washington
limited liability company.
"Clearwire International Entities": the collective references to
Clearwire International and its Subsidiaries.
"Clearwire1": Clearwire US LLC, a Nevada limited liability company.
"Closing Date": the date on which the conditions precedent set forth
in Section 5 shall have been satisfied or waived, which date is August __, 2006.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": all property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document.
"Commitment": as to any Lender, the obligation of such Lender, if any,
to make a Loan to the Borrower in a principal amount not to exceed the amount
set forth under the heading "Commitment" opposite such Lender's name on Schedule
1.1A. The original aggregate amount of the Commitments is $125,000,000.
"Commonly Controlled Entity": an entity, whether or not incorporated,
that is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a group that includes the Borrower and that is
treated as a single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit B.
"Conduit Lender": any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required to
be made by such Lender and designated by such Lender in a written instrument;
provided, that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole right and responsibility to deliver all consents and waivers required or
requested under this Agreement with respect to its Conduit Lender, and provided,
further, that no Conduit Lender shall (a) be entitled to receive any greater
amount pursuant to Section 2.12, 2.13, 2.14 or 10.5 than the designating Lender
would have been entitled to receive in respect of the Loans made by such Conduit
Lender or (b) be deemed to have any Commitment.
"Confidential Information Memorandum": the Confidential Information
Memorandum dated June 2006 and furnished to certain Lenders.
"Consolidated EBITDA": for any period, Consolidated Net Income for
such period plus, without duplication and to the extent reflected as a charge in
the statement of such Consolidated Net Income for such period, the sum of (a)
income and franchise tax expense, (b) interest expense (net of interest income),
amortization or writeoff of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness
(including the Loans), (c) depreciation
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and amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any extraordinary, unusual or
non-recurring expenses or losses (including, whether or not otherwise includable
as a separate item in the statement of such Consolidated Net Income for such
period, losses on sales of assets outside of the ordinary course of business),
(f) non-cash charges (provided that if any such non-cash expenses represents an
accrual of or reserve for cash expenses in any future period, the cash payment
in respect thereof in such future period shall be subtracted from Consolidated
EBITDA to such extent, and excluding amortization of a prepaid cash expense that
was paid in a prior period, (g) restructuring charges or reserves, (h) fees and
expenses incurred in connection with any investment, disposition, acquisition,
issuance of equity interests, incurrence or early extinguishment of
indebtedness, or refinancing transaction or other modification of any debt
instrument, in each case permitted herein, (i) purchase accounting adjustments
in connection with permitted acquisitions hereunder, (j) expenses related to the
transactions contemplated by this Agreement, (k) the amount of minority interest
expense, (l) any non-cash compensation charge arising from any grant of stock,
stock options or other equity-based rewards, (m) non-cash pension and other
post-employment benefit expenses and (n) any non-cash SFAS 133 income (or loss)
related to hedging activities and minus, (a) to the extent included in the
statement of such Consolidated Net Income for such period, the sum of (i) any
extraordinary, unusual or non-recurring income or gains (including, whether or
not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, gains on the sales of assets outside of
the ordinary course of business), (ii) income tax credits (to the extent not
netted from income tax expense) and (iii) any other non-cash income (other than
(x) the accrual of revenue consistent with past practice and (y) the reversal in
such period of an accrual of, or cash reserve for, cash expenses in a prior
period) and (b) any cash payments made during such period in respect of items
described in clause (e) above subsequent to the fiscal quarter in which the
relevant non-cash expenses or losses were reflected as a charge in the statement
of Consolidated Net Income, all as determined on a consolidated basis. For the
purposes of calculating Consolidated EBITDA for any period of four consecutive
fiscal quarters (each, a "Reference Period") pursuant to any determination of
the Consolidated Leverage Ratio, (i) if at any time during such Reference Period
the Borrower or any Subsidiary shall have made any Material Disposition, the
Consolidated EBITDA for such Reference Period shall be reduced by an amount
equal to the Consolidated EBITDA (if positive) attributable to the property that
is the subject of such Material Disposition for such Reference Period or
increased by an amount equal to the Consolidated EBITDA (if negative)
attributable thereto for such Reference Period and (ii) if during such Reference
Period the Borrower or any Subsidiary shall have made a Material Acquisition,
Consolidated EBITDA for such Reference Period shall be calculated after giving
pro forma effect thereto as if such Material Acquisition occurred on the first
day of such Reference Period. As used in this definition, "Material Acquisition"
means any acquisition of property or series of related acquisitions of property
that constitutes assets comprising all or substantially all of an operating unit
of a business or constitutes all or substantially all of the common stock of a
Person; and "Material Disposition" means any Disposition of property or series
of related Dispositions of property that yields gross proceeds to the Borrower
or any of its Subsidiaries in excess of $1,000,000. Calculations of Consolidated
EBITDA shall take into account any identifiable cost savings from Material
Acquisitions and Material Dispositions to the extent such savings are reasonably
acceptable to the Administrative Agent and have been reasonably identified in
good faith by a responsible financial or accounting officer of the Borrower.
"Consolidated Leverage Ratio": as at the last day of any period, the
ratio of (a) Consolidated Total Debt on such day to (b) Consolidated EBITDA for
such period.
"Consolidated Net Income": for any period, the consolidated net income
(or loss) of the Borrower and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP; provided that (I) there shall be
excluded (a) the income (or deficit) of any Person accrued prior to the date it
becomes a Subsidiary of the Borrower or is merged into or consolidated with the
Borrower or any of its Subsidiaries, (b) the income (or deficit) of any Person
(other than a Subsidiary of the Borrower) in which
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the Borrower or any of its Subsidiaries has an ownership interest, except to the
extent that any such income is actually received by the Borrower or such
Subsidiary in the form of dividends or similar distributions (and the net loss
of any such Person shall be included only to the extent that such loss is funded
in cash by the specified Person or a Subsidiary thereof) and (c) the
undistributed earnings of any Subsidiary of the Borrower to the extent that the
declaration or payment of dividends or similar distributions by such Subsidiary
is not at the time permitted by the terms of any Contractual Obligation (other
than under any Loan Document) or Requirement of Law applicable to such
Subsidiary and (II) there shall be included the net income of any Unrestricted
Subsidiary to the extent it is distributed to the Borrower or any of its
Restricted Subsidiaries during such period; provided, further that the
cumulative effect of any change in accounting principles shall be excluded from
the calculation of Net Income.
"Consolidated Total Debt": at any date, the aggregate principal amount
of all Indebtedness for borrowed money of the Borrower and its Restricted
Subsidiaries at such date, determined on a consolidated basis in accordance with
GAAP, less the unrestricted cash and Cash Equivalents of the Borrower and its
Restricted Subsidiaries in excess of $100,000,000 on such day. For purposes of
calculating Consolidated Leverage Ratio, Consolidated Total Debt shall be
calculated after giving pro forma effect to the repayment of any Indebtedness on
the date of determination.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control Investment Affiliate": as to any Person, any other Person
that (a) directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person and (b) is organized by such Person primarily
for the purpose of making equity or debt investments in one or more companies.
For purposes of this definition, "control" of a Person means the power, directly
or indirectly, to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.
"Default": any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
"Designated Noncash Consideration": the Fair Market Value of noncash
consideration received by the Borrower or any Restricted Subsidiary in
connection with an Asset Sale that is so designated as Designated Noncash
Consideration pursuant to an Officers' Certificate, setting forth the basis of
such valuation, less the amount of Cash Equivalents received in connection with
a subsequent sale of such Designated Noncash Consideration.
"Designated Spectrum": the FCC License Rights specifically identified
on Schedule 1.1C hereto.
"Disposition": with respect to any property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof. The
terms "Dispose" and "Disposed of" shall have correlative meanings.
"Disqualified Stock": any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or is redeemable at the option of the
holder thereof, in whole or in part, on or prior to the Maturity Date; provided,
however, that only the portion of Capital Stock which so matures
8
or is mandatorily redeemable, is so convertible or exchangeable or is so
redeemable at the option of the holder thereof prior to such dates shall be
deemed to be Disqualified Stock. Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Borrower to repurchase such
Capital Stock upon the occurrence of a change of control or an asset sale shall
not constitute Disqualified Stock if the terms of such Capital Stock provide
that the Borrower may not repurchase or redeem any such Capital Stock pursuant
to such provisions unless such repurchase or redemption complies with Section
7.6. The term "Disqualified Stock" shall also include any options, warrants or
other rights that are convertible into Disqualified Stock or that are redeemable
at the option of the holder, or required to be redeemed, prior to the Maturity
Date.
"Documentation Agent": as defined in the preamble hereto.
"Dollars" and "$": dollars in lawful currency of the United States.
"Domestic Restricted Subsidiary": a Domestic Subsidiary that is a
Restricted Subsidiary.
"Domestic Subsidiary": any Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States.
"Environmental Laws": any and all foreign, Federal, state, local or
municipal laws, rules having the force and effect of law, written orders,
regulations, statutes, ordinances, codes, decrees, requirements of any
Governmental Authority or other Requirements of Law (including common law)
regulating, relating to or imposing liability or standards of conduct concerning
protection of public health or the environment, as now or may at any time
hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such day
(including basic, supplemental, marginal and emergency reserves) under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.
"Eurodollar Base Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on Page
3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. In the event that such rate does
not appear on Page 3750 of the Telerate screen (or otherwise on such screen),
the "Eurodollar Base Rate" shall be determined by reference to such other
comparable publicly available service for displaying eurodollar rates as may be
selected by the Administrative Agent or, in the absence of such availability, by
reference to the rate at which the Administrative Agent is offered Dollar
deposits at or about 11:00 A.M., New York City time, two Business Days prior to
the beginning of such Interest Period in the interbank eurodollar market where
its eurodollar and foreign currency and exchange operations are then being
conducted for delivery on the first day of such Interest Period for the number
of days comprised therein.
"Eurodollar Loans": Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
9
"Eurodollar Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for such day
in accordance with the following formula (rounded upward to the nearest 1/100th
of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar Loans the
then current Interest Periods with respect to all of which begin on the same
date and end on the same later date (whether or not such Loans shall originally
have been made on the same day).
"Event of Default": any of the events specified in Section 8, provided
that any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
"Existing Notes": the Borrower's Senior Notes due 2010 issued pursuant
to the Existing Notes Indenture.
"Existing Notes Indenture": the Indenture, dated as of August 5, 2005,
as amended through the date hereof and as may be amended, restated,
supplemented, replaced, refinanced or otherwise modified in accordance with the
terms hereof, among the Borrower and The Bank of New York, as trustee, with
respect to the Existing Notes.
"Facility": the Commitments and the Loans made thereunder.
"Fair Market Value": the value that would be paid by a willing buyer
to an unaffiliated willing seller on an arm's length basis in a transaction not
involving distress or necessity of either party, determined in good faith by a
majority of the disinterested members of the Board of Directors of the Borrower
(unless otherwise provided in this Agreement).
"FCC": the Federal Communications Commission and any successor
thereto.
"FCC License": any paging, mobile telephone, specialized mobile radio,
microwave or personal communications services and any other license, permit,
consent, certificate of compliance, franchise, approval, waiver or authorization
granted or issued by the FCC, including any of the foregoing authorizing or
permitting the acquisition, construction or operation of any Wireless
Communications System.
"FCC License Rights": any right, title or interest in, to or under any
FCC License, whether directly or indirectly held, including, without limitation,
any rights owned, granted, approved or issued directly or indirectly by the FCC
or held, leased, licensed or otherwise acquired from or through any party
(including without limitation any rights under Spectrum Leases).
"Federal Funds Effective Rate": for any day, the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior
Funding, Inc. from three federal funds brokers of recognized standing selected
by it.
"Foreign Subsidiary": means any Person (a) which is organized under
the laws of any jurisdiction outside the United States (within the meaning of
Section 7701(a)(9) of the Code), or (b)
10
whose principal assets consist of capital stock or other Capital Stocks of one
or more Persons that are "controlled foreign corporations" within the meaning of
Section 957 of the Code.
"Funding Office": the office of the Administrative Agent specified in
Section 10.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and
the Lenders.
"GAAP": generally accepted accounting principles in the United States
as in effect from time to time. In the event that any "Accounting Change" (as
defined below) shall occur and such change results in a change in the method of
calculation of financial standards or terms in this Agreement, then the Borrower
and the Administrative Agent agree to enter into negotiations in order to amend
such provisions of this Agreement so as to reflect equitably such Accounting
Changes with the desired result that the criteria for evaluating the Borrower's
financial condition shall be the same after such Accounting Changes as if such
Accounting Changes had not been made. Until such time as such an amendment shall
have been executed and delivered by the Borrower, the Administrative Agent and
the Required Lenders, all financial standards and terms in this Agreement shall
continue to be calculated or construed as if such Accounting Changes had not
occurred. "Accounting Changes" refers to changes in accounting principles
required by the promulgation of any rule, regulation, pronouncement or opinion
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or, if applicable, the SEC.
"Governmental Authority": any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of
government, any securities exchange and any self-regulatory organization
(including the National Association of Insurance Commissioners).
"Grantor": as defined in the Guarantee and Collateral Agreement.
"Group Members": the collective reference to the Borrower and its
Restricted Subsidiaries.
"Guarantee": as to any Person, a guarantee other than by endorsement
of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a
pledge of assets or through letters of credit or reimbursement agreements in
respect thereof, of all or any part of any Indebtedness of another Person.
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by the Borrower and each Guarantor,
substantially in the form of Exhibit A restated, supplemented or otherwise
modified from time to time.
"Guarantors": the collective reference to (a) Spectrum Holdings (and
any other Spectrum Entity), Telecommunications Services and Clearwire 1, (b)
each other Material Domestic Restricted Subsidiary of the Borrower as of the
Closing Date (other than NextNet and its Subsidiaries) which is not prohibited
pursuant to the terms of the Existing Notes Indenture or any Restrictive
Refinancing from guaranteeing the Obligations and (c) each other present and
future subsidiary of the Borrower that becomes a Guarantor pursuant to Section
6.9 hereof provided that no Foreign Subsidiary shall be a Guarantor hereunder.
11
"Hedging Obligations": with respect to any specified Person, the
obligations of such Person under:
(1) interest rate swap agreements (whether from fixed to floating or
from floating to fixed), interest rate cap agreements and interest rate
collar agreements;
(2) other agreements or arrangements designed to manage interest rates
or interest rate risk; and
(3) other agreements or arrangements designed to protect such Person
against fluctuations in currency exchange rates or commodity prices.
"Immaterial Subsidiary": as of any date, any Restricted Subsidiary
whose total assets, as of such date, are less than $5,000,000 and whose total
revenues for the most recent 12-month period do not exceed $5,000,000; provided
that a Restricted Subsidiary will not be considered to be an Immaterial
Subsidiary if it, directly or indirectly, guarantees or otherwise provides
direct credit support for any Indebtedness of the Borrower.
"Incur": with respect to any Indebtedness, to incur, create, issue,
assume, Guarantee or otherwise become directly or indirectly liable for or with
respect to, or become responsible for, the payment of, contingently or
otherwise, such Indebtedness (and "Incurrence" and "Incurred" will have meanings
correlative to the foregoing); provided that (1) any Indebtedness of a Person
existing at the time such Person becomes a Restricted Subsidiary of the Borrower
will be deemed to be Incurred by such Restricted Subsidiary at the time it
becomes a Restricted Subsidiary of the Borrower and (2) neither the accrual of
interest nor the accretion of original issue discount nor the payment of
interest in the form of additional Indebtedness with the same terms and the
payment of dividends on Disqualified Stock or Preferred Stock in the form of
additional shares of the same class of Disqualified Stock or Preferred Stock (to
the extent provided for when the Indebtedness or Disqualified Stock or Preferred
Stock on which such interest or dividend is paid was originally issued) will be
considered an Incurrence of Indebtedness.
"Indebtedness": with respect to any specified Person, any indebtedness
of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) in respect of Capital Lease Obligations and Attributable Debt;
(5) in respect of the balance deferred and unpaid of the purchase price of
any property or services, except any such balance that constitutes an
accrued expense or trade payable; provided that Indebtedness shall not
include any earn-out obligation or obligation in respect of purchase
price adjustment, except to the extent that the contingent
consideration relating thereto is not paid within 15 Business Days
after the contingency relating thereto is resolved;
(6) representing Hedging Obligations;
12
(7) representing Disqualified Stock valued at the greater of its voluntary
or involuntary maximum fixed repurchase price plus accrued dividends;
or
(8) representing Preferred Stock issued by such Person (other than the
Borrower or any Guarantor) valued at its maximum involuntary fixed
repurchase price plus accrued dividends,
if and to the extent any of the preceding items (other than letters of credit
and other than pursuant to clauses (4), (5), (6), (7) or (8)) would appear as a
liability upon a balance sheet of the specified Person prepared in accordance
with GAAP. In addition, the term "Indebtedness" includes (x) all Indebtedness of
others secured by a Lien on any asset of the specified Person (whether or not
such Indebtedness is assumed by the specified Person) other than a pledge of
Capital Stock of an Unrestricted Subsidiary to secure Non-Recourse Debt of such
Unrestricted Subsidiary, provided that the amount of such Indebtedness shall be
the lesser of (A) the Fair Market Value of such asset at such date of
determination and (B) the amount of such Indebtedness, and (y) to the extent not
otherwise included, the Guarantee by the specified Person of any Indebtedness of
any other Person, provided further that any obligation of the Borrower or any
Restricted Subsidiary in respect of minimum guaranteed commissions, or other
similar payments, to clients, minimum returns to clients or stop loss limits in
favor of clients or indemnification obligations to clients, in each case
pursuant to contracts to provide services to clients entered into in the
ordinary course of business, shall be deemed not to constitute Indebtedness. For
purposes hereof, the "maximum fixed repurchase price" of any Disqualified Stock
or Preferred Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Disqualified Stock or Preferred
Stock, as applicable, as if such Disqualified Stock or Preferred Stock were
repurchased on any date on which Indebtedness shall be required to be determined
pursuant to this Agreement. For the avoidance of doubt, in no event shall either
Spectrum Leases or any Guarantee of obligations under Spectrum Leases or FCC
License Rights be deemed to be Indebtedness for purposes of this Agreement.
The amount of any Indebtedness outstanding as of any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and, with respect to contingent obligations, the maximum liability upon
the occurrence of the contingency giving rise to the obligation, and shall be:
(1) the accreted value thereof, in the case of any Indebtedness issued
with original issue discount; and
(2) the principal amount thereof, together with any interest thereon that
is more than 30 days past due, in the case of any other Indebtedness.
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Intellectual Property": the collective reference to all rights
relating to intellectual property, whether arising under United States,
multinational or foreign laws or otherwise, including copyrights, copyright
licenses, patents, patent licenses, trademarks, trademark licenses, technology,
know-how and processes, and all rights to ▇▇▇ at law or in equity for any
infringement or other impairment thereof, including the right to receive all
proceeds and damages therefrom.
"Interest Payment Date": (a) as to any ABR Loan, the last day of each
March, June, September and December to occur while such Loan is outstanding and
the final maturity date of such
13
Loan, (b) as to any Eurodollar Loan having an Interest Period of three months or
less, the last day of such Interest Period, (c) as to any Eurodollar Loan having
an Interest Period longer than three months, each day that is three months, or a
whole multiple thereof, after the first day of such Interest Period, and the
last day of such Interest Period and (d) as to any Loan, the date of any
repayment or prepayment made in respect thereof.
"Interest Period": as to any Eurodollar Loan, (a) initially, the
period commencing on the borrowing or conversion date, as the case may be, with
respect to such Eurodollar Loan and ending one, two, three or six (or, if agreed
to by all Lenders, nine or twelve) months thereafter, as selected by the
Borrower in its notice of borrowing or notice of conversion, as the case may be,
given with respect thereto; and (b) thereafter, each period commencing on the
last day of the next preceding Interest Period applicable to such Eurodollar
Loan and ending one, two, three or six (or, if agreed to by all Lenders, nine or
twelve) months thereafter, as selected by the Borrower by irrevocable notice to
the Administrative Agent not later than 11:00 A.M., New York City time, on the
date that is three Business Days prior to the last day of the then current
Interest Period with respect thereto; provided that, all of the foregoing
provisions relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such Interest
Period shall end on the immediately preceding Business Day;
(ii) the Borrower may not select an Interest Period that would extend
beyond the Maturity Date; and
(iii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of a calendar month.
"Investments": as defined in Section 7.6(a)(4).
"Joint Venture Interests": Equity Interests in a Person engaged in a
Permitted Business that is not a Restricted Subsidiary of the Company.
"Lenders": as defined in the preamble hereto; provided, that unless
the context otherwise requires, each reference herein to the Lenders shall be
deemed to include any Conduit Lender.
"Lien": with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset, whether
or not filed, recorded or otherwise perfected under applicable law, including
any conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in
and any filing of or agreement to give any financing statement under the Uniform
Commercial Code (or equivalent statutes) of any jurisdiction.
"Loan": as defined in Section 2.1.
"Loan Documents": this Agreement, the Security Documents, the Notes
and any amendment, restatement, waiver, supplement or other modification to any
of the foregoing.
"Loan Parties": the collective reference to the Borrower and the
Guarantors.
14
"Material Adverse Effect": a material adverse effect on (a) the
business, properties, operations, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a whole, (b) the
validity or enforceability of this Agreement or any of the other material Loan
Documents or the material rights or remedies of the Administrative Agent or the
Lenders hereunder or thereunder or (c) the ability of the Loan Parties, taken as
a whole, to perform the obligations under the Loan Documents.
"Material Domestic Restricted Subsidiary": any Domestic Restricted
Subsidiary that is not an Immaterial Subsidiary or that the Borrower designates
as a Material Domestic Restricted Subsidiary by written notice to the
Administrative Agent.
"Material Foreign Subsidiary": any Foreign Subsidiary that is not an
Immaterial Subsidiary.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including asbestos, polychlorinated biphenyls
and urea-formaldehyde insulation.
"Maturity Date": the third anniversary of the Closing Date.
"Multiemployer Plan": a Plan that is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.
"Net Proceeds": in connection with any Asset Sale, the proceeds
thereof in excess of $25,000,000 in the aggregate in the form of cash and Cash
Equivalents (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received), net of (1)
attorneys' fees, accountants' fees, investment banking fees, (2) amounts
required to be applied to the repayment of liabilities secured by a Lien
expressly permitted hereunder on any asset that is the subject of such Asset
Sale (other than any Lien pursuant to a Security Document), (3) other customary
fees and expenses actually incurred in connection therewith and net of taxes
paid or reasonably estimated to be payable as a result thereof (after taking
into account any available tax credits or deductions and any tax sharing
arrangements) (including any taxes imposed on the repatriation of proceeds), (4)
any reserve for adjustment in respect of the sale price of such asset or assets
established in accordance with GAAP, and (5) appropriate amounts to be provided
by the Borrower or its Subsidiaries as a reserve against liabilities associated
with such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale, all as determined in accordance with GAAP.
"NextNet": NextNet Wireless, Inc., a Delaware corporation.
"Non-Excluded Taxes": as defined in Section 2.13(a).
"Non-Recourse Debt": Indebtedness:
(1) as to which neither the Borrower nor any of its Restricted
Subsidiaries provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute
Indebtedness); provided, however, that the Borrower or any Restricted
Subsidiary may Guaranty such Indebtedness to the extent such Guaranty
is permitted under Section 7.1 or 7.6; and
15
(2) as to which the lenders have been notified in writing that they will
not have any recourse to the stock or assets of the Borrower or any of
its Restricted Subsidiaries (other than a pledge of Capital Stock of
Unrestricted Subsidiaries).
"Non-U.S. Lender": as defined in Section 2.13(d).
"Notes": the collective reference to any promissory notes evidencing
Loans.
"Obligations": the unpaid principal of and interest on (including
interest accruing after the maturity of the Loans and interest accruing after
the filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
the Loans and all other obligations and liabilities of the Borrower to the
Administrative Agent or to any Lender (or, in the case of Specified Swap
Agreements, any affiliate of any Lender), whether direct or indirect, absolute
or contingent, due or to become due, or now existing or hereafter incurred,
which may arise under, out of, or in connection with, this Agreement, any other
Loan Document, any Specified Swap Agreement or any other document made,
delivered or given in connection herewith or therewith, whether on account of
principal, interest, reimbursement obligations, fees, indemnities, costs,
expenses (including all fees, charges and disbursements of counsel to the
Administrative Agent or to any Lender that are required to be paid by the
Borrower pursuant hereto) or otherwise; provided, that any release of Collateral
or Guarantors effected in the manner permitted by this Agreement shall not
require the consent of holders of obligations under Specified Swap Agreements.
"Officer": the Chairman or any Co-Chairman of the Board, any Vice
Chairman of the Board, the Chief Executive Officer, the President, any Executive
Vice President, the Chief Financial Officer or the General Counsel.
"Officers' Certificate": a certificate signed by one or more Officers.
"Opinion of Counsel": a written opinion from legal counsel. The
counsel may be an employee of or counsel to the Borrower.
"Other Taxes": any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement or any other Loan Document.
"Participant": as defined in Section 10.6(c).
"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).
"Percentage": as to any Lender at any time, the percentage which such
Lender's Commitment then constitutes of the aggregate Commitments (or, at any
time after the Closing Date, the percentage which the aggregate principal amount
of such Lender's Loans then outstanding constitutes of the aggregate principal
amount of the Loans then outstanding).
"Permitted Business": any business conducted or proposed to be
conducted by the Borrower and its Restricted Subsidiaries on the Closing Date
and other businesses reasonably related, complementary or ancillary thereto or a
reasonable extension or expansion thereof.
16
"Permitted Liens":
(1) Liens securing the Obligations;
(2) Liens securing Permitted Refinancing Indebtedness; provided that the
Indebtedness being refinanced was, and is, permitted under Section 7.1
and such Liens do not extend to any property or assets other than (A)
the property or assets that secured the Indebtedness being refinanced
and (B) other property or assets of Unrestricted Subsidiaries so long
as such property or assets are also subject to Liens securing the
Obligations on a pari passu basis;
(3) General rules and regulations of the FCC in 47 CFR 1.9001 et. seq.
governing Spectrum Leases;
(4) Liens on (i) FCC License Rights in favor of the FCC to the extent
required and arising by operation of law, or (ii) arising from the
lease or sublease of such FCC License Rights in the ordinary course of
business solely to the extent that (A) such spectrum is not necessary
to the conduct of the business of the Borrower and its Subsidiaries as
then conducted or contemplated to be conducted in accordance with the
Borrower's business plan, as approved by the Board of Directors of the
Borrower, (B) such Lien could not reasonably be expected to have a
material adverse effect on the value of the Collateral or impair the
utility or operation thereof or the ability of the Administrative
Agent or the Lenders to realize the benefits of, and intended to be
afforded by, the Collateral, (C) to the extent such lease or sublease
constitutes Collateral, the Administrative Agent has a valid perfected
first priority security interest in such lease or sublease and all
proceeds thereof, including, without limitation, all rents and other
payments thereunder, and (D) such lease or sublease is an Asset Sale
otherwise permitted by this Agreement and any requirements of this
Agreement in connection with such Asset Sale shall have been complied
with;
(5) Liens existing on the Closing Date which (i) are disclosed on Schedule
1.1B hereto or (ii) individually or in the aggregate, do not (x) have
an adverse affect on more than $3,000,000 of the Collateral or (y)
materially impair the use of Collateral for the purposes for which the
Collateral is held by the Loan Parties;
(6) Judgment and attachment Liens not giving rise to an Event of Default
and notices of lis pendens and associated rights related to litigation
being contested in good faith by appropriate proceedings and for which
adequate reserves have been made;
(7) Liens, deposits or pledges to secure public or statutory obligations,
surety, stay, appeal, indemnity, performance or other similar bonds or
obligations or letters of credit; and Liens, deposits or pledges in
lieu of such bonds or obligations, or to secure such bonds or
obligations, or to secure letters of credit in lieu of or supporting
the payment of such bonds or obligations or such other letters of
credit;
(8) Liens for taxes, assessments and governmental charges not yet
delinquent or being contested in good faith and, in each case, for
which adequate reserves have been established to the extent required
by GAAP;
17
(9) Any interest or title of a lessor, licensor or sublicensor in the
property subject to any lease, license or sublicense (other than any
property that is the subject of a Sale and Leaseback Transaction),
including, without limitation, FCC License Rights;
(10) Liens incurred or deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance and
other types of social security; and
(11) Liens on assets or securities deemed to arise in connection with and
solely as a result of the execution, delivery or performance of
contracts to sell such assets or securities if such sale is otherwise
permitted hereunder.
"Permitted Refinancing Indebtedness": any Indebtedness of the Borrower
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are substantially concurrently used to extend, refinance,
renew, replace, defease or refund other Indebtedness of the Borrower or any of
its Restricted Subsidiaries (other than intercompany Indebtedness) permitted
hereunder; provided that:
(1) the amount of such Permitted Refinancing Indebtedness does not exceed
the amount of the Indebtedness (the "Refinanced Indebtedness") so
extended, refinanced, renewed, replaced, defeased or refunded (plus
all accrued and unpaid interest thereon and the amount of any premium
reasonably determined in accordance with the terms of such Refinanced
Indebtedness or otherwise acceptable to the Administrative Agent and
necessary to accomplish such refinancing and such reasonable expenses
Incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life
to Maturity equal to or greater than the Weighted Average Life to
Maturity (determined in each case exclusive of de minimus scheduled
payment amounts) of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and
(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the
Obligations, such Permitted Refinancing Indebtedness is subordinated
in right of payment to the Obligations on terms at least as favorable,
taken as a whole, to the Administrative Agent and the Lenders as those
contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan that is
covered by ERISA and in respect of which the Borrower or, solely with respect to
employee benefit plans that are subject to Title IV of ERISA, a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5)
of ERISA.
"Pledged Subsidiary": a Restricted Subsidiary the Capital Stock of
which is required to be pledged to secure the Obligations pursuant to the terms
of this Agreement.
18
"Preferred Stock": with respect to any Person, any Capital Stock of
such Person that has preferential rights to any other Capital Stock of such
Person with respect to dividends or redemptions upon liquidation.
"Pro Forma Financials": as defined in Section 4.1(a).
"Projections": as defined in Section 6.2(c).
"Properties": as defined in Section 4.17(a).
"Qualified IPO": either: (1) a firm commitment, fully underwritten
public offering primarily in the United States of the Borrower's Class A Common
Stock by a nationally recognized investment banking firm with gross proceeds to
the Borrower of not less than $300,000,000, with the Class A Common Stock listed
on either the New York Stock Exchange or the Nasdaq National Market; or (2) at
any time when the Borrower's Class A Common Stock is listed on either the New
York Stock Exchange or the Nasdaq National Market, the public float of such
listed stock equals or exceeds $300,000,000 and the total equity market
capitalization of the Borrower is not less than $1,000,000,000.
"Reference Date": August 5, 2005.
"Register": as defined in Section 10.6(b).
"Regulation U": Regulation U of the Board as in effect from time to
time.
"Reinvestment Deferred Amount": with respect to any Reinvestment
Event, the aggregate Net Proceeds received by the Borrower and its Restricted
Subsidiaries in connection therewith that are not applied to prepay the Loans
pursuant to Section 2.5, as applicable, as a result of the delivery of a
Reinvestment Notice.
"Reinvestment Event": any Asset Sale in respect of which the Borrower
has delivered a Reinvestment Notice.
"Reinvestment Notice": a written notice executed by a Responsible
Officer stating that the Borrower (directly or indirectly through a Subsidiary)
intends and expects to use all or a specified portion of the Net Proceeds of an
Asset Sale to acquire or repair Replacement Assets.
"Reinvestment Prepayment Amount": with respect to any Reinvestment
Event, the Reinvestment Deferred Amount relating thereto less any amount
expended prior to the relevant Reinvestment Prepayment Date to acquire or repair
Replacement Assets.
"Reinvestment Prepayment Date": with respect to any Reinvestment
Event, the earlier of (a) the date occurring one year after such Reinvestment
Event and (b) the date on which the Borrower shall have determined not to
acquire or repair Replacement Assets with all or any portion of the relevant
Reinvestment Deferred Amount.
"Replacement Assets": (1) non-current assets (including any such
assets acquired by capital expenditures) that shall be used or useful in a
Permitted Business or (2) substantially all the assets of a Permitted Business
or a majority of the Voting Stock of any Person engaged in a Permitted Business
that shall become on the date of acquisition thereof a Material Domestic
Restricted Subsidiary of the Borrower (in the case of Replacement Assets in
respect of any FCC License Rights, Spectrum Leases or Wireless Communications
Systems, including Capital Stock in entities owning such FCC License Rights,
19
Spectrum Leases and Wireless Communications Systems, in the nature of either (A)
substitute, replacement or other comparable FCC Licenses, Spectrum Leases and
Wireless Communications Systems and Capital Stock in entities owning any FCC
License Rights, Spectrum Leases and Wireless Communications Systems, which in
each case are of equivalent Fair Market Value to such assets that were the
subject of such Asset Sale or (B) equipment that may be used in expanding any
Wireless Communications Systems, which in either case under the preceding
clauses (A) and (B) are, or upon acquisition will become, subject to a valid
perfected first priority Lien in favor of the Administrative Agent under the
Guarantee and Collateral Agreement to the same extent as the assets so
replaced).
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.
"Reportable Event": any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg.
Section 4043.
"Required Lenders": at any time, the holders of more than 50% of (a)
until the Closing Date, the Commitments then in effect and (b) thereafter, the
aggregate unpaid principal amount of the Loans then outstanding.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Restricted Payments": as defined in Section 7.6.
"Restrictive Refinancing": any Indebtedness of the Borrower the
proceeds of which are used to contemporaneously repay, refinance or replace the
Existing Notes and the terms of which prohibit any Material Domestic Restricted
Subsidiary from guaranteeing, or granting a security interest in its assets to
secure the payment of, the Obligations.
"Restricted Subsidiary": with respect to any Person, any Subsidiary of
such Person that is not an Unrestricted Subsidiary.
"Sale and Leaseback Transaction": with respect to any Person, any
transaction involving any of the assets or properties of such Person whether now
owned or hereafter acquired, whereby such Person sells or otherwise transfers
such assets or properties and then or thereafter leases such assets or
properties or any part thereof or any other assets or properties which such
Person intends to use for substantially the same purpose or purposes as the
assets or properties sold or transferred.
"SEC": the Securities and Exchange Commission, any successor thereto
and any analogous Governmental Authority.
"Security Documents": the collective reference to the Guarantee and
Collateral Agreement and all other security documents hereafter delivered to the
Administrative Agent granting a Lien on any property of any Person to secure the
obligations and liabilities of any Loan Party under any Loan Document.
"Single Employer Plan": any Plan that is covered by Title IV of ERISA,
but that is not a Multiemployer Plan.
20
"Solvent": when used with respect to any Person, means that, as of any
date of determination, (a) the amount of the "present fair saleable value" of
the assets of such Person will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date,
determined on a going concern basis as such quoted terms are determined in
accordance with applicable federal and state laws governing determinations of
the insolvency of debtors, (b) the present fair saleable value of the assets of
such Person, determined on a going concern basis, will, as of such date, be
greater than the amount that will be required to pay the liability of such
Person on its debts as such debts become absolute and matured, (c) such Person
will not have, as of such date, an unreasonably small amount of capital with
which to conduct its business, and (d) such Person will be able to pay its debts
as they mature. For purposes of this definition, (i) "debt" means liability on a
"claim", and (ii) "claim" means any (x) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (y) right to an equitable remedy for breach of performance if such breach
gives rise to a right to payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured or unmatured,
disputed, undisputed, secured or unsecured.
"Specified Equity Shortfall": as of any date, the amount (if any) by
which (i) $600,000,000 exceeds (ii) the aggregate amount of net proceeds
received by the Borrower on or prior to such date from one or more issuances of
its common equity to Intel Capital or Motorola Ventures or existing investors.
"Specified Swap Agreement": any Swap Agreement entered into by the
Borrower or any Guarantor and any Lender or Agent (or affiliate of either
thereof) in respect of interest rates.
"Specified Unrestricted Subsidiary": any Unrestricted Subsidiary with
any Indebtedness with respect to which a default by such Unrestricted Subsidiary
would permit, whether or not upon notice, lapse of time or both, any holder of
any other Indebtedness of the Borrower or any of its Restricted Subsidiaries to
declare a default on such other Indebtedness or cause the payment of such other
Indebtedness to be accelerated or payable prior to its Stated Maturity.
"Spectrum Entities": Spectrum Holdings and each other Subsidiary that
at any time holds any FCC License Rights that constitute Designated Spectrum
(excluding Designated Spectrum exchanged for Replacement Assets in accordance
with Section 7.4) or Replacement Assets in respect thereof.
"Spectrum Holdings": Clearwire Spectrum Holdings, LLC, a Nevada
limited liability company.
"Spectrum Lease": any lease, license, agreement or other arrangement
pursuant to which the Borrower or any Restricted Subsidiary leases, licenses or
otherwise acquires or obtains any rights, whether exclusive or non-exclusive,
with respect to any FCC License, to which the Borrower or any Restricted
Subsidiary is now or may hereafter become a party, as amended, amended and
restated, supplemented or otherwise modified from time to time.
"Stated Maturity": with respect to any installment of interest or
principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness (including as a result of any mandatory repurchase or
redemption in accordance with the terms thereof) as of the date of this
Agreement, or for Indebtedness Incurred after the date of this Agreement, the
documentation governing such Indebtedness when Incurred, in each case giving
effect to any amendments to such documentation to the extent approved by the
Administrative Agent.
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"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Borrower.
"Swap Agreement": any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
the Borrower or any of its Subsidiaries shall be a "Swap Agreement".
"Syndication Agent": as defined in the preamble hereto.
"Telecommunications Services": Clearwire Telecommunications Services,
LLC, a Nevada limited liability company.
"Transferee": any Assignee or Participant.
"Type": as to any Loan, its nature as an ABR Loan or a Eurodollar
Loan.
"United States": the United States of America.
"Unrestricted Subsidiary": (i) each of the Clearwire International
Entities, (ii) Clearwire Spectrum Holdings II, LLC and (iii) any other
Subsidiary of the Borrower that is designated by the Board of Directors of the
Borrower as an Unrestricted Subsidiary pursuant to a resolution of the Board of
Directors, but only if such other Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is a Person with respect to which neither the Borrower nor any of its
Restricted Subsidiaries has any direct or indirect obligation (a) to
subscribe for additional Capital Stock or (b) to maintain or preserve
such Person's financial condition or to cause such Person to achieve
any specified levels of operating results, except, in each case, to
the extent any resulting Investment would be permitted under Section
7.6; and
(3) is not a Loan Party.
"Voting Stock": any class or classes of Capital Stock pursuant to
which the holders of such Capital Stock under ordinary circumstances have the
power to vote in the election of the board of directors, managers or trustees of
any Person or other Persons performing similar functions irrespective of whether
or not, at the time, Capital Stock of any other class or classes shall have, or
might have, voting power by reason of the happening of any contingency.
"Weighted Average Life to Maturity": when applied to any Indebtedness
at any date, the number of years obtained by dividing:
22
(1) the sum of the products obtained by multiplying (a) the amount of each
then remaining installment, sinking fund, serial maturity or other
required payments of principal, including payment at final maturity,
in respect thereof, by (b) the number of years (calculated to the
nearest one-twelfth) that shall elapse between such date and the
making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Guarantor": any Guarantor that is a Wholly Owned
Subsidiary of the Borrower.
"Wholly Owned Subsidiary": as to any Person, any other Person all of
the Capital Stock of which (other than directors' qualifying shares required by
law) is owned by such Person directly and/or through other Wholly Owned
Subsidiaries.
"Wireless Communications System": any system to provide
telecommunications services, including, without limitation, specialized mobile
radio system, radio paging system, mobile telephone system, cellular radio
telecommunications system, conventional mobile telephone system, personal
communications system, EBS/ITFS-based system or BRS/MDS/MMDS-based system, data
transmission system or any other paging, mobile telephone, radio, microwave,
communications, broadband or data transmission system.
1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in the other Loan Documents
or any certificate or other document made or delivered pursuant hereto or
thereto.
(b) As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto, (i)
accounting terms relating to any Group Member not defined in Section 1.1 and
accounting terms partly defined in Section 1.1, to the extent not defined, shall
have the respective meanings given to them under GAAP, (ii) the words "include",
"includes" and "including" shall be deemed to be followed by the phrase "without
limitation", (iii) the words "asset" and "property" shall be construed to have
the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, Capital Stock, securities, revenues,
accounts, leasehold interests, Spectrum Leases and contract rights, and (iv)
references to agreements or other Contractual Obligations shall, unless
otherwise specified, be deemed to refer to such agreements or Contractual
Obligations as amended, supplemented, restated or otherwise modified from time
to time.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Commitments. Subject to the terms and conditions hereof, each
Lender severally agrees to make a term loan (a "Loan") to the Borrower on the
Closing Date in an amount not to exceed
23
the amount of the Commitment of such Lender. The Loans may from time to time be
Eurodollar Loans or ABR Loans, as determined by the Borrower and notified to the
Administrative Agent in accordance with Sections 2.2 and 2.6.
2.2 Procedure for Borrowing. The Borrower shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to 10:00 A.M., New York City time, one Business Day
prior to the anticipated Closing Date) requesting that the Lenders make the
Loans on the Closing Date and specifying the Type and amount to be borrowed. The
Administrative Agent shall credit the account of the Borrower on the books of
such office of the Administrative Agent with such amount on the Closing Date in
immediately available funds.
2.3 Repayment of Loans. The Loan of each Lender shall mature in eleven
consecutive quarterly installments, each of which shall be in an amount equal to
such Lender's Percentage multiplied by the amount set forth below opposite such
installment:
Installment Principal Amount
----------- ----------------
December 31, 2006 $ 312,500
March 31, 2007 $ 312,500
June 30, 2007 $ 312,500
September 30, 2007 $ 312,500
December 31, 2007 $ 312,500
March 31, 2008 $ 312,500
June 30, 2008 $ 312,500
September 30, 2008 $ 312,500
December 31, 2008 $ 312,500
March 31, 2009 $ 312,500
August 18, 2009 $121,875,500
2.4 Optional Prepayments. (a) The Borrower may at any time and from
time to time prepay the Loans, in whole or in part, without premium (except as
provided in paragraph (b) below) or penalty, upon irrevocable notice delivered
to the Administrative Agent no later than 11:00 A.M., New York City time, three
Business Days prior thereto, in the case of Eurodollar Loans, and no later than
11:00 A.M., New York City time, one Business Day prior thereto, in the case of
ABR Loans, which notice shall specify the date and amount of prepayment and
whether the prepayment is of Eurodollar Loans or ABR Loans; provided, that if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the Borrower shall also pay any amounts owing
pursuant to Section 2.14. Upon receipt of any such notice the Administrative
Agent shall promptly notify each relevant Lender thereof. If any such notice is
given, the amount specified in such notice shall be due and payable on the date
specified therein, together with accrued interest to such date on the amount
prepaid. Partial prepayments of Loans shall be in an aggregate principal amount
of $5,000,000 or a whole multiple of $1,000,000 in excess thereof.
(b) Each optional prepayment of Loans (i) made on or prior to the
first anniversary of the Closing Date shall be accompanied by a prepayment
premium of 2.0% of the principal amount of such prepayment and (ii) made after
the first anniversary of the Closing Date but on or prior to the second
anniversary of the Closing Date shall be accompanied by a prepayment premium of
1.0% of the principal amount of such prepayment.
2.5 Mandatory Prepayments. If on any date the Borrower or any
Restricted Subsidiary shall receive Net Proceeds from any Asset Sale, then,
unless a Reinvestment Notice in respect thereof is included in the first
officer's certificate required to be delivered after such date pursuant to
24
Section 6.2(a), such Net Proceeds shall be applied on the date of delivery of
such officer's certificate toward the prepayment of the Loans; provided, that,
notwithstanding the foregoing, (i) on each Reinvestment Prepayment Date, an
amount equal to the Reinvestment Prepayment Amount with respect to the relevant
Reinvestment Event shall be applied toward the prepayment of the Loans and (ii)
in no event shall the Borrower or any Restricted Subsidiary be required to make
any prepayment pursuant to this Section 2.5 in an amount that would exceed the
maximum amount then permitted pursuant to the Existing Notes Indenture.
2.6 Conversion and Continuation Options. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the Business Day preceding the proposed
conversion date, provided that any such conversion of Eurodollar Loans may only
be made on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert ABR Loans to Eurodollar Loans by giving
the Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the third Business Day preceding the proposed
conversion date (which notice shall specify the length of the initial Interest
Period therefor), provided that no ABR Loan may be converted into a Eurodollar
Loan when any Event of Default has occurred and is continuing and the
Administrative Agent or the Required Lenders have determined in its or their
sole discretion not to permit such conversions. Upon receipt of any such notice
the Administrative Agent shall promptly notify each relevant Lender thereof.
(b) Any Eurodollar Loan may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the Borrower giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such Loans, provided
that no Eurodollar Loan may be continued as such when any Event of Default has
occurred and is continuing and the Administrative Agent has or the Required
Lenders have determined in its or their sole discretion not to permit such
continuations, and provided, further, that if the Borrower shall fail to give
any required notice as described above in this paragraph or if such continuation
is not permitted pursuant to the preceding proviso such Loans shall be
automatically converted to ABR Loans on the last day of such then expiring
Interest Period. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.
2.7 Limitations on Eurodollar Tranches. Notwithstanding anything to
the contrary in this Agreement, all borrowings, conversions and continuations of
Eurodollar Loans and all selections of Interest Periods shall be in such amounts
and be made pursuant to such elections so that, (a) after giving effect thereto,
the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of
$1,000,000 in excess thereof and (b) no more than five Eurodollar Tranches shall
be outstanding at any one time.
2.8 Interest Rates and Payment Dates. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per annum equal to the
ABR plus the Applicable Margin.
(c) (i) If all or a portion of the principal amount of any Loan shall
not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such overdue amount shall bear interest at a rate per annum equal to
the rate that would otherwise be applicable thereto pursuant to the foregoing
provisions of this Section plus 2%, and (ii) if all or a portion of any interest
payable on any Loan or any
25
other amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum equal to the rate then applicable to ABR Loans plus 2%, in
each case, with respect to clauses (i) and (ii) above, from the date of such
non-payment until such amount is paid in full (as well after as before
judgment).
(d) Interest shall be payable in arrears on each Interest Payment
Date, provided that interest accruing pursuant to paragraph (c) of this Section
shall be payable from time to time on demand.
2.9 Computation of Interest and Fees. (a) Interest and fees payable
pursuant hereto shall be calculated on the basis of a 360-day year for the
actual days elapsed, except that, with respect to ABR Loans the rate of interest
on which is calculated on the basis of the Prime Rate, the interest thereon
shall be calculated on the basis of a 365- (or 366-, as the case may be) day
year for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the Lenders of the effective date and the amount of each such
change in interest rate.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 2.8(a).
2.10 Inability to Determine Interest Rate. If prior to the first day
of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from the
Required Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as conclusively certified to the Borrower by such Lenders) of making or
maintaining their affected Loans during such Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter. If such notice is
given, (x) any Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as ABR Loans, (y) any Loans that were to have been
converted on the first day of such Interest Period to Eurodollar Loans shall be
continued as ABR Loans and (z) any outstanding Eurodollar Loans shall be
converted, on the last day of the then-current Interest Period, to ABR Loans.
Until such notice has been withdrawn by the Administrative Agent, no further
Eurodollar Loans shall be made or continued as such, nor shall the Borrower have
the right to convert Loans to Eurodollar Loans.
26
2.11 Pro Rata Treatment and Payments. (a) Each borrowing by the
Borrower from the Lenders hereunder shall be made pro rata according to the
respective Percentages of the Lenders.
(b) Each payment (including each prepayment) by the Borrower on
account of principal of and interest on the Loans shall be made pro rata
according to the respective outstanding principal amounts of the Loans then held
by the Lenders. The amount of each principal prepayment of the Loans shall be
applied to reduce the then remaining installments of the Loans in the order
determined by the Borrower. Amounts prepaid on account of the Loans may not be
reborrowed. The application of any payment of Loans (including optional and
mandatory prepayments) shall be made, first, to Base Rate Loans and, second, to
Eurodollar Loans. Notwithstanding the foregoing, if the amount of any prepayment
of Loans shall be in excess of the amount of the Base Rate Loans at the time
outstanding (an "Excess Amount"), only the portion of the amount of such
prepayment as is equal to the amount of such outstanding Base Rate Loans shall
be immediately prepaid and, at the election of the Borrower, the Excess Amount
shall be deposited in an escrow account on terms reasonably satisfactory to the
Administrative Agent and the Borrower and applied to the prepayment of
Eurodollar Loans on the last day of the then next-expiring Interest Period for
Eurodollar Loans; provided that (i) interest in respect of such Excess Amount
shall continue to accrue thereon at the rate provided hereunder for the Loans
which such Excess Amount is intended to repay until such Excess Amount (and any
returns on investment relating thereto) shall have been used in full to repay
such Loans and (ii) at any time while a Event of Default has occurred and is
continuing, the Administrative Agent may, and upon written direction from the
Required Lenders shall, apply any or all proceeds then on deposit to the payment
of such Loans in an amount equal to such Excess Amount.
(c) All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without setoff or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Lenders promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the Eurodollar Loans) becomes due and payable
on a day other than a Business Day, such payment shall be extended to the next
succeeding Business Day. If any payment on a Eurodollar Loan becomes due and
payable on a day other than a Business Day, the maturity thereof shall be
extended to the next succeeding Business Day unless the result of such extension
would be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day. In the case of
any extension of any payment of principal pursuant to the preceding two
sentences, interest thereon shall be payable at the then applicable rate during
such extension.
(d) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon, at a
rate equal to the greater of (i) the Federal Funds Effective Rate and (ii) a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation, for the period until such Lender makes such
amount immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this paragraph shall be conclusive in the absence of manifest error. If
such Lender's share of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days
27
after such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon at the rate per annum applicable to
ABR Loans, on demand, from the Borrower.
(e) Unless the Administrative Agent shall have been notified in
writing by the Borrower prior to the date of any payment due to be made by the
Borrower hereunder that the Borrower will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such payment, and the Administrative Agent may, but shall not be required
to, in reliance upon such assumption, make available to the Lenders their
respective pro rata shares of a corresponding amount. If such payment is not
made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount which was made available pursuant
to the preceding sentence, such amount with interest thereon at the rate per
annum equal to the daily average Federal Funds Effective Rate. Nothing herein
shall be deemed to limit the rights of the Administrative Agent or any Lender
against the Borrower.
2.12 Requirements of Law. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement or any Eurodollar Loan made by it, or change
the basis of taxation of payments to such Lender in respect thereof (except
for Non-Excluded Taxes covered by Section 2.13 and changes in the rate of
tax on the overall net income or franchise of such Lender) it being
understood and agreed that, in the case of any non-U.S. Lender that does
not comply with Section 2.13(d), this clause (i) shall not apply to the
extent that such tax is attributable to such failure to comply with Section
2.13(d);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender that is not otherwise included in the determination
of the Eurodollar Rate; or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans, or to reduce any amount receivable
hereunder in respect thereof, then, in any such case, the Borrower shall
promptly pay such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount receivable. If
any Lender becomes entitled to claim any additional amounts pursuant to this
paragraph, it shall promptly notify the Borrower (with a copy to the
Administrative Agent) of the event by reason of which it has become so entitled.
(b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on such Lender's or such corporation's capital as a
consequence of its obligations hereunder to a level below that which such Lender
or such corporation could have achieved but for such adoption, change or
compliance (taking into
28
consideration such Lender's or such corporation's policies with respect to
capital adequacy) by an amount deemed by such Lender to be material, then from
time to time, after submission by such Lender to the Borrower (with a copy to
the Administrative Agent) of a written request therefor, the Borrower shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such corporation for such reduction.
(c) A certificate as to any additional amounts payable pursuant to
this Section submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
Borrower shall pay the amounts due pursuant to this Section 2.12 within ten
Business Days of its receipt of the Certificate delivered by the applicable
Lender pursuant to the preceding sentence. Notwithstanding anything to the
contrary in this Section, the Borrower shall not be required to compensate a
Lender pursuant to this Section for any amounts incurred more than nine months
prior to the date that such Lender notifies the Borrower of such Lender's
intention to claim compensation therefor; provided that, if the circumstances
giving rise to such claim have a retroactive effect, then such nine-month period
shall be extended to include the period of such retroactive effect. The
obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
2.13 Taxes. (a) All payments made by the Borrower under this Agreement
shall be made free and clear of, and without deduction or withholding for or on
account of, any present or future income or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, excluding
net income taxes (including branch profit taxes) and franchise taxes (imposed in
lieu of net income taxes) imposed on the Administrative Agent or any Lender as a
result of a present or former connection between the Administrative Agent or
such Lender and the jurisdiction of the Governmental Authority imposing such tax
or any political subdivision or taxing authority thereof or therein (other than
any such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement or any other Loan Document). If any such
non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") or Other Taxes are required to be withheld
from any amounts payable to the Administrative Agent or any Lender hereunder,
the amounts so payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative Agent or such
Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any
such other amounts payable hereunder at the rates or in the amounts specified in
this Agreement, provided, however, that the Borrower shall not be required to
increase any such amounts payable to the Administrative Agent or any Lender with
respect to any Non-Excluded Taxes (i) that are attributable to the
Administrative Agent or such Lender's failure to comply with the requirements of
paragraph (d) or (e) of this Section or (ii) that are United States withholding
taxes imposed on amounts payable to the Administrative Agent or such Lender at
the time the Administrative Agent or such Lender becomes a party to this
Agreement, except to the extent that the Administrative Agent or such Lender's
assignor (if any) was entitled, at the time it becomes a party to this
Agreement, to receive additional amounts from the Borrower with respect to such
Non-Excluded Taxes pursuant to this paragraph.
(b) In addition, to the extent permitted under applicable law, the
Borrower shall pay any Other Taxes to the relevant Governmental Authority in
accordance with applicable law. To the extent the Borrower is not permitted to
pay such Other Taxes, the applicable Lender shall pay, and the Borrower shall
promptly reimburse the applicable Lender for, such Other Taxes.
(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, evidence of such payment reasonably
29
acceptable to the Administrative Agent. If the Borrower fails to withhold any
Non-Excluded Taxes or to pay Other Taxes when due to the appropriate taxing
authority, the Borrower shall indemnify the Administrative Agent and the Lenders
for any incremental taxes, interest or penalties (other than those resulting
from the gross negligence or willful misconduct of the Administrative Agent or
any Lender) that may become payable by the Administrative Agent or any Lender as
a result of any such failure. The agreements in this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
(d) Administrative Agent (if it is a "U.S. person", as defined in
Section 7701(a)(30) of the Code (a "U.S. Person")) and each Lender or Transferee
that is a U.S. Person (a "U.S. Lender"), other than a U.S. Lender that is
treated as an "exempt recipient" under Treasury Regulation Section 1.6049-4(c)
without the need for supporting documentation, and with respect to which no
withholding is required, shall, in the case of the Administrative Agent and each
U.S. Lender that is a signatory hereto, on or prior to the date of execution of
this Agreement and, in the case of a Transferee, on or prior to the date of the
assignment or sale of a participation, provide to the Borrower two complete
copies of Internal Revenue Service Form W-9 or any successor form. The
Administrative Agent (if it is not a U.S. Person), and each Lender or Transferee
that is not a U.S. Person (a "Non-U.S. Lender") shall deliver to the Borrower
and the Administrative Agent (or, in the case of a Participant, to the Lender
from which the related participation shall have been purchased) two copies of
either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case
of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of "portfolio
interest", a statement substantially in the form of Exhibit F and a Form W-8BEN
or Form W-81MY (including all relevant attachments), or any subsequent versions
thereof or successors thereto, in each case, properly completed and duly
executed by such Non-U.S. Lender claiming complete exemption from, or a reduced
rate of, U.S. federal withholding tax on all payments by the Borrower under this
Agreement and the other Loan Documents. Such forms shall be delivered by each
Non-U.S. Lender on or before the date it becomes a party to this Agreement (or,
in the case of any Participant, on or before the date such Participant purchases
the related participation). In addition, each Non-U.S. Lender shall deliver such
forms promptly upon the obsolescence or invalidity of any form previously
delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify
the Borrower at any time it determines that it is no longer in a position to
provide any previously delivered certificate to the Borrower (or any other form
of certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall
not be required to deliver any form pursuant to this paragraph that such
Non-U.S. Lender is not legally able to deliver.
(e) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which the Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender's reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
(f) If the Administrative Agent or any Lender determines, in its sole
discretion, that it has received a refund of any Non-Excluded Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to this Section 2.13, it
shall pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
2.13 with respect to the Non-Excluded Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent
30
or such Lender and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund); provided, that the
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This paragraph shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to the Borrower or any other Person.
2.14 Indemnity. The Borrower agrees to indemnify each Lender for, and
to hold each Lender harmless from, any loss or expense that such Lender may
sustain or incur as a consequence of (a) default by the Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by the Borrower in making any
prepayment of or conversion from Eurodollar Loans after the Borrower has given a
notice thereof in accordance with the provisions of this Agreement or (c) the
making of a prepayment of Eurodollar Loans on a day that is not the last day of
an Interest Period with respect thereto. Such indemnification may include an
amount equal to the excess, if any, of (i) the amount of interest that would
have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of such Interest Period (or, in the
case of a failure to borrow, convert or continue, the Interest Period that would
have commenced on the date of such failure) in each case at the applicable rate
of interest for such Loans provided for herein (excluding, however, the
Applicable Margin included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) that would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank eurodollar market. A certificate as to any
amounts payable pursuant to this Section submitted to the Borrower by any Lender
shall be conclusive in the absence of manifest error. This covenant shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
2.15 Change of Lending Office. Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.12 or 2.13(a)
with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the sole judgment of such Lender, cause
such Lender and its lending office(s) to suffer no economic, legal or regulatory
disadvantage, and provided, further, that nothing in this Section shall affect
or postpone any of the obligations of the Borrower or the rights of any Lender
pursuant to Section 2.12 or 2.13(a).
2.16 Replacement of Lenders. The Borrower shall be permitted to
replace any Lender that (a) requests reimbursement for amounts owing pursuant to
Section 2.12 or 2.13(a) or (b) defaults in its obligation to make Loans
hereunder, with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Event of
Default shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Lender shall have taken no action
under Section 2.15 so as to eliminate the continued need for payment of amounts
owing pursuant to Section 2.12 or 2.13(a), (iv) the replacement financial
institution shall purchase, at par, all Loans and other amounts owing to such
replaced Lender on or prior to the date of replacement, (v) the Borrower shall
be liable to such replaced Lender under Section 2.14 if any Eurodollar Loan
owing to such replaced Lender shall be purchased other than on the last day of
the Interest Period relating thereto, (vi) the replacement financial
institution, if not already a Lender, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Lender shall be obligated to make such
replacement in accordance with the provisions of Section 10.6 (provided that the
Borrower shall be obligated to pay the
31
registration and processing fee referred to therein), (viii) until such time as
such replacement shall be consummated, the Borrower shall pay all additional
amounts (if any) required pursuant to Section 2.12 or 2.13(a), as the case may
be, and (ix) any such replacement shall not be deemed to be a waiver of any
rights that the Borrower, the Administrative Agent or any other Lender shall
have against the replaced Lender.
SECTION 3. [RESERVED]
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans, the Borrower hereby represents and warrants to
the Administrative Agent and each Lender that:
4.1 Financial Condition.
(a) The audited consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as at December 31, 2003, December 31, 2004 and
December 31, 2005, and the related consolidated statements of income and of cash
flows for the fiscal years ended on such dates, reported on by and accompanied
by an unqualified report from Deloitte & Touche LLP, present fairly in all
material respects the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date, and the consolidated results of its
operations and its consolidated cash flows for the respective fiscal years then
ended. The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at March 31, 2006, and the related unaudited
consolidated statements of income and cash flows for the fiscal quarter ended on
such date, present fairly in all material respects the consolidated financial
condition of the Borrower and its consolidated Subsidiaries as at such date, and
the consolidated results of its operations and its consolidated cash flows for
the fiscal quarter then ended (subject to normal year-end audit adjustments and
absence of footnotes). All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein).
4.2 No Change. Since December 31, 2005, there has been no development
or event that has had or could reasonably be expected to have a Material Adverse
Effect.
4.3 Existence; Compliance with Law. Each Group Member (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, except where the failure to be in good
standing could not reasonably be expected to have a Material Adverse Effect, (b)
has the power and authority, and the legal right, to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation or other organization and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification (except where the failure to be so
qualified could not reasonably be expected to have a Material Adverse Effect)
and (d) is in compliance with all Requirements of Law except to the extent that
the failure to comply therewith could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.
4.4 Power; Authorization; Enforceable Obligations. Each Loan Party has
the corporate power and authority, and the legal right, to make, deliver and
perform the Loan Documents to which it is a party and, in the case of the
Borrower, to obtain the Loans hereunder. Each Loan Party has taken all necessary
organizational action to authorize the execution, delivery and performance of
the Loan Documents to which it is a party and, in the case of the Borrower, to
authorize the borrowing of the Loans
32
on the terms and conditions of this Agreement. No material consent or
authorization of, filing with, notice to or other material act by or in respect
of, any Governmental Authority or any other Person is required in connection
with the Loans hereunder or with the execution, delivery, performance, validity
or enforceability of this Agreement or any of the Loan Documents, except (i)
consents, authorizations, filings and notices described in Schedule 4.4, which
consents, authorizations, filings and notices have been obtained or made and are
in full force and effect and (ii) the filings referred to in Section 4.19. Each
Loan Document has been duly executed and delivered on behalf of each Loan Party
that is a party thereto. This Agreement constitutes, and each other Loan
Document upon execution will constitute, a legal, valid and binding obligation
of each Loan Party that is a party thereto, enforceable against each such Loan
Party in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).
4.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the other Loan Documents, the borrowings hereunder and the use of
the proceeds thereof will not violate any Requirement of Law or any Contractual
Obligation of any Group Member and will not result in, or require, the creation
or imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation (other
than the Liens created by the Security Documents or liens permitted under
Section 7.2).
4.6 Litigation. No litigation, investigation or proceeding of or
before any arbitrator or Governmental Authority is pending or, to the knowledge
of the Borrower, threatened in writing by or against any Group Member or against
any of their respective properties or revenues (a) with respect to any of the
Loan Documents or any of the transactions contemplated hereby or thereby or (b)
that could reasonably be expected to have a Material Adverse Effect.
4.7 No Default. No Group Member is in default under or with respect to
any of its Contractual Obligations in any respect that could reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
4.8 Ownership of Property; Liens. Each Group Member has title in fee
simple to, or a valid leasehold interest in, all its real property, and good
title to, or a valid leasehold interest in or right to use all its other
property except as could not reasonably be expected to have a Material Adverse
Effect, and none of such property is subject to any Lien except as permitted by
Section 7.2.
4.9 Intellectual Property. Except as set forth on Schedule 4.9, each
Group Member owns, or has the right to use, all material Intellectual Property
necessary for the conduct of its business as currently conducted. Except as
could not reasonably be expected to have a Material Adverse Effect, no material
claim has been asserted and is pending by any Person challenging or questioning
the use of any Intellectual Property or the validity or enforceability of any
Intellectual Property. The use of Intellectual Property by each Group Member
does not infringe on the rights of any Person except as could not reasonably be
expected to have a Material Adverse Effect.
4.10 Taxes. Except as could not reasonably be expected to have a
Material Adverse Effect, each Group Member has filed or caused to be filed all
Federal, state and other material tax returns that are required to be filed
(after giving effect to all extensions) and has paid all taxes shown to be due
and payable on said returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority (other than any amounts the validity of
which are currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided on the
33
books of the relevant Group Member); no tax Lien has been filed, and, to the
knowledge of the Borrower, no claim is being asserted, with respect to any such
tax, fee or other charge.
4.11 Federal Regulations. No part of the proceeds of any Loans, and no
other extensions of credit hereunder, will be used (a) for "buying" or
"carrying" any "margin stock" within the respective meanings of each of the
quoted terms under Regulation U as now and from time to time hereafter in effect
or (b) for any purpose that violates the provisions of the Regulations of the
Board. If requested by any Lender or the Administrative Agent, the Borrower will
furnish to the Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.
4.12 Labor Matters. Except as, in the aggregate, could not reasonably
be expected to have a Material Adverse Effect: (a) there are no strikes or other
labor disputes against any Group Member pending or, to the knowledge of the
Borrower, threatened; (b) hours worked by and payment made to employees of each
Group Member have not been in violation of the Fair Labor Standards Act or any
other applicable Requirement of Law dealing with such matters; and (c) all
payments due from any Group Member on account of employee health and welfare
insurance have been paid or accrued as a liability on the books of the relevant
Group Member.
4.13 ERISA. No material Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code. No termination of a Single Employer Plan has occurred, and no Lien
in favor of the PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer Plan (based on
those assumptions used to fund each such Plan) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits by a material amount. Neither the Borrower nor any Commonly Controlled
Entity has had a complete or partial withdrawal from any Multiemployer Plan that
has resulted or could reasonably be expected to result in a material liability
under ERISA, and neither the Borrower nor any Commonly Controlled Entity would
become subject to any material liability under ERISA if the Borrower or any such
Commonly Controlled Entity were to withdraw completely from all Multiemployer
Plans as of the valuation date most closely preceding the date on which this
representation is made or deemed made. No such Multiemployer Plan is in
Reorganization or Insolvent.
4.14 Investment Company Act; Other Regulations. No Loan Party is an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) that limits its ability to incur Indebtedness.
4.15 Subsidiaries. As of the Closing Date, (a) Schedule 4.15 sets
forth the name and jurisdiction of incorporation of each Subsidiary and, as to
each such Subsidiary, the percentage of each class of Capital Stock owned by any
Loan Party and (b) there are no outstanding subscriptions, options, warrants,
calls, rights or other agreements or commitments (other than stock options
granted to employees or directors and directors' qualifying shares) of any
nature relating to any Capital Stock of any Pledged Subsidiary, except as
created by the Loan Documents.
4.16 Use of Proceeds. The proceeds of the Loans shall be used (i) to
pay fees and expenses in connection with this Agreement and the financing
provided for herein and (ii) for general corporate purposes of the Loan Parties;
provided that, notwithstanding the foregoing, (x) up to $25,000,000 in the
aggregate of the proceeds of the Loans utilized for the purposes described in
this
34
clause (ii) may be used by any Unrestricted Subsidiaries for any purpose and (y)
up to $100,000,000 in the aggregate of the proceeds of the Loans utilized for
the purposes described under this clause (ii) may be used to make investments in
Unrestricted Subsidiaries for the purpose of acquiring spectrum.
4.17 Environmental Matters. Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect:
(a) the facilities and properties owned, leased or operated by any
Group Member (the "Properties") do not contain, and have not previously
contained, any Materials of Environmental Concern in amounts or concentrations
or under circumstances that constitute or constituted a violation of, or could
give rise to liability under, any Environmental Law;
(b) no Group Member has received or is aware of any notice of
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of the Properties or the business operated by any Group Member
(the "Business"), nor does the Borrower have knowledge or reason to believe that
any such notice will be received or is being threatened;
(c) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
that could give rise to liability under, any Environmental Law, nor have any
Materials of Environmental Concern been generated, treated, stored or disposed
of at, on or under any of the Properties in violation of, or in a manner that
could give rise to liability under, any applicable Environmental Law;
(d) no judicial proceeding or governmental or administrative action is
pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which any Group Member is or will be named as a party with
respect to the Properties or the Business, 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 the Properties or the Business;
(e) there has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of any Group Member in connection with the Properties or
otherwise in connection with the Business, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws;
(f) the Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, with all
applicable Environmental Laws, and there is no contamination at, under or about
the Properties or violation of any Environmental Law with respect to the
Properties or the Business; and
(g) no Group Member has assumed any liability of any other Person
under Environmental Laws.
This section 4.17 contains the sole and exclusive representations and warranties
of the Borrower with respect to any Environmental Law.
4.18 Accuracy of Information, etc. No statement or information
(excluding any projections and pro forma financial information) contained in
this Agreement, any other Loan Document, the Confidential Information Memorandum
or any other document, certificate or written statement relating to the Group
Members furnished by or on behalf of any Loan Party to the Administrative Agent
or the Lenders, or any of them, for use in connection with the transactions
contemplated by this
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Agreement or the other Loan Documents, when taken as a whole, contained as of
the date such statement, information, document or certificate was so furnished,
any untrue statement of a material fact or omitted to state a material fact
necessary to make the statements contained herein or therein not materially
misleading at the time made in light of the circumstances under which they were
made. The projections and pro forma financial information contained in the
materials referenced above are based upon good faith assumptions believed by the
Borrower to be reasonable at the time made in light of circumstances under which
such assumptions were made, it being recognized by the Lenders that such
financial information as it relates to future events is not to be viewed as fact
and that actual results during the period or periods covered by such financial
information may differ from the projected results set forth therein by a
material amount.
4.19 Security Documents. The Guarantee and Collateral Agreement is
effective to create in favor of the Administrative Agent, for the benefit of the
Lenders, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof (to the extent such matter is governed by
the law of the United States or a jurisdiction therein). In the case of the
Pledged Stock described in the Guarantee and Collateral Agreement in which a
security interest may be perfected by the filing of a financing statement (or
through filings with the United States Patent and Trademark Office and United
States Copyright Office with respect to Intellectual Property), when stock
certificates representing such Pledged Stock are delivered to the Administrative
Agent, and in the case of the other Collateral described in the Guarantee and
Collateral Agreement, when financing statements and other filings specified on
Schedule 4.19 in appropriate form are filed in the offices specified on Schedule
4.19, the Guarantee and Collateral Agreement shall constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Collateral and the proceeds thereof (subject to the provisions
of Section 9-315 of the New York Uniform Commercial Code), as security for the
Obligations (as defined in the Guarantee and Collateral Agreement), in each case
prior and superior in right to any other Person (except, in the case of
Collateral other than Pledged Stock, Liens permitted by Section 7.2) (to the
extent such matter is governed by the law of the United States or a jurisdiction
therein).
4.20 Solvency. As of the Closing Date, the Borrower and its
consolidated subsidiaries when taken as a whole are and after giving effect to
the incurrence of all Indebtedness and obligations being incurred in connection
herewith will be Solvent.
SECTION 5. CONDITIONS PRECEDENT
The agreement of each Lender to make the Loan requested to be made by
it is subject to the satisfaction or waiver, prior to or concurrently with the
making of such Loan on the Closing Date, of the following conditions precedent:
(a) Credit Agreement; Guarantee and Collateral Agreement. The
Administrative Agent shall have received (i) this Agreement, executed and
delivered by the Administrative Agent, the Borrower and each Person listed on
Schedule 1.1A, (ii) the Guarantee and Collateral Agreement, executed and
delivered by each Loan Party and (iii) an Acknowledgement and Consent in the
form attached to the Guarantee and Collateral Agreement, executed and delivered
by each Issuer (as defined therein), if any, that is not a Loan Party.
(b) Financial Statements. The Lenders shall have received (i) audited
consolidated financial statements of the Borrower and its consolidated
Subsidiaries for the 2003, 2004 and 2005 fiscal years and (ii) unaudited interim
consolidated financial statements of the Borrower and its consolidated
Subsidiaries for each fiscal quarter ended after the date of the latest
applicable financial statements delivered pursuant to clause (i) of this
paragraph as to which such financial statements are available.
36
(c) Approvals. All governmental and third party approvals necessary in
connection with the Facility shall have been obtained and be in full force and
effect, and all applicable waiting periods shall have expired without any action
being taken by any competent authority that would restrain, prevent or otherwise
impose adverse conditions on the financing contemplated hereby.
(d) Lien Searches. The Administrative Agent shall have received the
results of a recent lien search in each of the jurisdictions in which Uniform
Commercial Code financing statements filings should be made to evidence or
perfect security interests in the Collateral of the Loan Parties, and such
search shall reveal no liens on any of the assets of the Loan Parties except for
liens permitted by Section 7.2 or discharged on or prior to the Closing Date
pursuant to documentation satisfactory to the Administrative Agent.
(e) Fees. The Lenders and the Administrative Agent shall have received
all fees and expenses required to be paid by the Borrower, and for which
invoices have been presented (including the reasonable fees and expenses of
legal counsel), on or before the Closing Date. All such amounts will be paid
with proceeds of Loans made on the Closing Date and will be reflected in the
funding instructions given by the Borrower to the Administrative Agent on or
before the Closing Date.
(f) Closing Certificate; Certified Certificate of Incorporation; Good
Standing Certificates. The Administrative Agent shall have received (i) a
certificate of each Loan Party, dated the Closing Date, substantially in the
form of Exhibit C, with appropriate insertions and attachments, including the
certificate of incorporation of each Loan Party that is a corporation certified
by the relevant authority of the jurisdiction of organization of such Loan
Party, and (ii) a long form good standing certificate for each Loan Party from
its jurisdiction of organization.
(g) Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions:
(i) the legal opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit E-1;
(ii) the legal opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, general counsel of
the Borrower and its Subsidiaries, substantially in the form of Exhibit
E-2.
Each such legal opinion shall cover such matters incident to the
financing contemplated by this Agreement as the Administrative Agent may
reasonably require.
(h) Pledged Stock; Stock Powers. The Administrative Agent shall have
received the certificates (if any) representing the shares of Capital Stock
pledged pursuant to the Guarantee and Collateral Agreement, together with an
undated stock power for each such certificate executed in blank by a duly
authorized officer of the pledgor thereof.
(i) Filings, Registrations and Recordings. Each document (including
any Uniform Commercial Code financing statement) required by the Security
Documents or under law to be filed, registered or recorded in order to create in
favor of the Administrative Agent, for the benefit of the Lenders, a perfected
Lien on the Collateral described therein (to the extent that perfection can be
achieved by the delivery of share certificates or by such filing, registration
or recording under the laws of the United States or any jurisdiction thereof),
prior and superior in right to any other Person (other than with respect to
Liens expressly permitted by Section 7.2), shall be in proper form for filing,
registration or recordation.
37
(j) Solvency Certificate. The Administrative Agent shall have received
a reasonably satisfactory solvency certificate from the chief financial officer
of the Borrower, attesting to the solvency of the Borrower and its Subsidiaries,
taken as a whole, both immediately before and immediately after giving effect to
the incurrence of the Loans and the use of proceeds thereof.
(k) Insurance. The Administrative Agent shall have received insurance
certificates satisfying the requirements of Section 5.2(b) of the Guarantee and
Collateral Agreement.
(l) Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the Loan Documents shall be
true and correct on and as of such date.
(m) No Default. No Default or Event of Default shall have occurred and
be continuing on such date or after giving effect to the Loans requested to be
made on such date.
The borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date of such borrowing that the foregoing
conditions have been satisfied.
SECTION 6. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as any Loan or other amount
is owing to any Lender or the Administrative Agent hereunder, the Borrower shall
and shall cause each of its Restricted Subsidiaries to:
6.1 Financial Statements. Furnish to the Administrative Agent:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Borrower, a copy of the audited consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at the end of
such year and the related audited consolidated statements of income and of cash
flows for such year, setting forth in each case in comparative form the figures
for the previous year, reported on without a "going concern" or like
qualification or exception, by Deloitte & Touche LLP or other independent
certified public accountants of nationally recognized standing;
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal year
of the Borrower, the unaudited consolidated balance sheet of the Borrower and
its consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income and of cash flows for such quarter
and the portion of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures for the previous year,
certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments and absence of
footnotes); and
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied (except as approved by such accountants or officer, as the case may be,
and disclosed in reasonable detail therein) consistently throughout the periods
reflected therein and with prior periods; provided, further, that the Borrower
shall be deemed to have satisfied its obligations under each of (i), (ii) and
(iii) above if it files such information with the Commission (if the Commission
will accept such filing) or otherwise makes such financial statements and other
information available on or through its web site.
6.2 Certificates; Other Information. Furnish to the Administrative
Agent:
38
(a) concurrently with the delivery of any financial statements
pursuant to Section 6.1, (i) a certificate of a Responsible Officer stating
that, to the best of such Responsible Officer's knowledge, each Loan Party
during such period has observed or performed all of its covenants and other
agreements, and satisfied every condition contained in this Agreement and the
other Loan Documents to which it is a party to be observed, performed or
satisfied by it, and that such Responsible Officer has obtained no knowledge of
any Default or Event of Default except as specified in such certificate and (ii)
in the case of quarterly or annual financial statements, to the extent not
previously disclosed to the Administrative Agent, a description of any change in
the jurisdiction of organization of any Loan Party and a list of any material
issuances, registrations or applications for registration of Intellectual
Property acquired by any Loan Party since the date of the most recent report
delivered pursuant to this clause (ii) (or, in the case of the first such report
so delivered, since the Closing Date);
(b) as soon as available, and in any event no later than 90 days after
the end of each fiscal year of the Borrower, a detailed consolidated budget for
the following fiscal year, and, as soon as available, significant revisions, if
any, of such budget with respect to such fiscal year;
(c) within 45 days after the end of the first three quarterly periods
of each fiscal year of the Borrower, a narrative discussion and analysis of the
financial condition and results of operations of the Borrower and its
Subsidiaries for such fiscal quarter and for the period from the beginning of
the then current fiscal year to the end of such fiscal quarter; provided that
the foregoing shall be satisfied if such narrative discussion and analysis is
substantially equivalent to that the Borrower would be required to file with the
Commission in a Quarterly Report on Form 10Q;
(d) prior to the effectiveness thereof, copies of substantially final
drafts of any proposed amendment, supplement, waiver or other modification with
respect to the Existing Notes Indenture or any Restrictive Refinancing;
(e) within five Business Days after the same are sent, copies of all
financial statements and reports the Borrower sends to the holders of any class
of its debt securities or public equity securities and, within five Business
Days after the same are filed, copies of all financial statements and reports
that the Borrower may make to, or file with, the SEC; and
(f) promptly, such additional financial and other information as any
Lender may from time to time reasonably request through the Administrative
Agent.
6.3 Payment of Obligations. Except as could not reasonably be expected
to have a Material Adverse Effect, pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the Borrower or the relevant Restricted Subsidiary, as applicable.
6.4 Maintenance of Existence; Compliance. (a)(i) Preserve, renew and
keep in full force and effect its organizational existence and (ii) take all
reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business, except, in each case, as
otherwise permitted by Section 7.7 and except, in the case of clause (ii) above,
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (b) comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect.
39
6.5 Maintenance of Property; Insurance. (a) Keep all property useful
and necessary in its business in substantially the same condition as of the date
hereof, ordinary wear and tear excepted and dispositions permitted hereunder and
(b) maintain with financially sound and reputable insurance companies insurance
on all its property in at least such amounts and against at least such risks
(but including in any event public liability, product liability and business
interruption) as are usually insured against in the same general area by
companies engaged in the same or a similar business.
6.6 Inspection of Property; Books and Records; Discussions. (a) Keep
proper books of records and accounts in which full, true and correct entries in
all material respects shall be made of all dealings and transactions in relation
to its business and activities and (b) upon reasonable prior notice and
Borrower's normal business hours, permit representatives of any Lender to visit
and inspect any of its properties and examine and make abstracts from any of its
books and records at any reasonable time and as often as may reasonably be
desired but collectively no more frequently than once per fiscal year unless a
Default or Event exists, and to discuss the business, operations, properties and
financial and other condition of the Borrower and its Restricted Subsidiaries
with officers and employees of the Borrower and its Restricted Subsidiaries and
with their independent certified public accountants, in each case with a
Responsible Officer present.
6.7 Notices. Promptly give notice to the Administrative Agent of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any Restricted Subsidiary or (ii) litigation,
investigation or proceeding known to the Borrower or any Restricted Subsidiary
that may exist at any time between the Borrower or any Restricted Subsidiary and
any Governmental Authority, that in either case, if not cured or if adversely
determined, as the case may be, could reasonably be expected to have a Material
Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or any
Restricted Subsidiary (i) in which the amount involved is $25,000,000 or more
and not covered by insurance, (ii) in which injunctive or similar relief is
sought and which could reasonably be expected to have a Material Adverse Effect
or (iii) which relates to any Loan Document;
(d) the following events, as soon as possible and in any event within
30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence of any Reportable Event with respect to any Plan, a failure to make
any required contribution to a Plan, the creation of any Lien in favor of the
PBGC or a Plan or any withdrawal from, or the non-standard termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the termination, Reorganization or Insolvency of, any Plan;
and
(e) any development or event that has had or could reasonably be
expected to have a Material Adverse Effect.
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Restricted
Subsidiary, as applicable, proposes to take with respect thereto.
40
6.8 Environmental Laws.
(a) Comply in all material respects with, and ensure compliance in all
material respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws, and obtain and comply in all material respects with and
maintain, and use commercially reasonable efforts to ensure that all tenants and
subtenants obtain and comply in all material respects with and maintain, any and
all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, in each of the foregoing cases where failure to
do so could reasonably be expected to have a Material Adverse Effect.
(b) Conduct and complete in all material respects all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material respects
with all material and lawful written orders and directives of all Governmental
Authorities regarding Environmental Laws, in each of the foregoing cases where
failure to do so could reasonably be expected to have a Material Adverse Effect.
6.9 Additional Collateral, etc.
(a) With respect to any property acquired after the Closing Date by
any Loan Party that is a Grantor (other than (x) any property described in
paragraph (b), (c) or (d) below and (y) any property subject to a Lien expressly
permitted by Section 7.2(2)(C), (D)) as to which the Administrative Agent, for
the benefit of the Lenders, does not have a perfected Lien, to the extent
required pursuant to the Guarantee and Collateral Agreement, promptly (i)
execute and deliver to the Administrative Agent such amendments to the Guarantee
and Collateral Agreement or such other documents as the Administrative Agent
deems reasonably necessary or advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a security interest in such property and (ii)
take all actions necessary or advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a perfected first priority security interest in
such property, including the filing of Uniform Commercial Code financing
statements in such jurisdictions as may be required by the Guarantee and
Collateral Agreement or by law or as may be requested by the Administrative
Agent (to the extent perfection may be achieved by such actions under the laws
of the United States or a jurisdiction thereof); provided that in no event shall
any Grantor be required to perfect any Lien by means other than the delivery of
share certificates or the making of filings, registrations or recordings
required for perfection under the laws of the United States or any jurisdiction
thereof.
(b) With respect to any new Material Domestic Restricted Subsidiary or
Spectrum Entity created or acquired after the Closing Date by (and which is a
direct Subsidiary of) any Loan Party (other than any such Subsidiary of NextNet
or Clearwire 1 to the extent the actions specified in this paragraph (b) are
then prohibited in respect of such Subsidiary pursuant to the terms of the
Existing Notes Indenture or any Restrictive Refinancing) (it being understood
that this paragraph (b) shall also apply, without limitation, to (w) any
existing Subsidiary which becomes a Material Domestic Restricted Subsidiary upon
ceasing to be a Foreign Subsidiary, ceasing to be an Immaterial Subsidiary,
ceasing to be an Unrestricted Subsidiary and/or being designated as such by
written notice to the Administrative Agent, (x) any existing Subsidiary that
becomes a Spectrum Entity, (y) any new or existing Material Domestic Restricted
Subsidiary to the extent the actions specified in this paragraph (b) cease to be
prohibited in respect of such existing Material Domestic Restricted Subsidiary
pursuant to the terms of the Existing Notes Indenture or any Restrictive
Refinancing and (z) NextNet and its Material Domestic Restricted Subsidiaries in
the event and to the extent that the sale of the Capital Stock or property
thereof to Motorola shall not have been consummated within 90 days after the
Closing Date), promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative Agent
deems necessary or advisable to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in the
Capital Stock of such Subsidiary
41
that is owned by any Loan Party, (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock, together with undated stock
powers, in blank, executed and delivered by a duly authorized officer of the
relevant Loan Party, (iii) cause such Subsidiary or Spectrum Entity (A) to
become a party to the Guarantee and Collateral Agreement, (B) to take such
actions necessary or advisable to grant to the Administrative Agent for the
benefit of the Lenders a perfected first priority security interest in the
Collateral described in the Guarantee and Collateral Agreement with respect to
such Subsidiary in accordance with the terms of the Guarantee and Collateral
Agreement, including the filing of Uniform Commercial Code financing statements
in such jurisdictions as may be required by the Guarantee and Collateral
Agreement or by law and (C) to deliver to the Administrative Agent a certificate
of such Subsidiary, substantially in the form of Exhibit C, with appropriate
insertions and attachments, and (iv) if requested by the Administrative Agent,
deliver to the Administrative Agent legal opinions relating to the matters
described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent.
(c) With respect to the Clearwire International Entities, if any such
entity shall at any time after the Closing Date enter into any Guarantee of any
Indebtedness of the Borrower or any Domestic Restricted Subsidiary (other than
any Clearwire International Entity), promptly (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a perfected first priority
security interest in the Capital Stock of such Clearwire International Entity,
(ii) deliver to the Administrative Agent the certificates representing such
Capital Stock, together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the pledgor of such Capital Stock,
(iii) cause such Clearwire International Entity (A) to become a party to the
Guarantee and Collateral Agreement, (B) to take such actions necessary or
advisable to grant to the Administrative Agent for the benefit of the Lenders a
perfected first priority security interest in the Collateral described in the
Guarantee and Collateral Agreement with respect to such Clearwire International
Entity, including the filing of Uniform Commercial Code financing statements in
such jurisdictions as may be required by the Guarantee and Collateral Agreement
or by law or as may be requested by the Administrative Agent and (C) to deliver
to the Administrative Agent a certificate of such Clearwire International
Entity, substantially in the form of Exhibit C, with appropriate insertions and
attachments, and (iv) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.
(d) With respect to any new Material Foreign Subsidiary (other than
any Clearwire International Entity) created or acquired after the Closing Date
by (and which is a direct Subsidiary of) any Loan Party that is a Grantor),
promptly (i) execute and deliver to the Administrative Agent such amendments to
the Guarantee and Collateral Agreement as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a perfected first priority security interest in the Capital Stock
of such new Subsidiary that is owned by any such Loan Party (provided that in no
event shall more than 65% of the total outstanding voting Capital Stock of any
such new Subsidiary be required to be so pledged), (ii) deliver to the
Administrative Agent the certificates representing such Capital Stock, together
with undated stock powers, in blank, executed and delivered by a duly authorized
officer of the relevant Loan Party, and take such other action as may be
necessary or, in the opinion of the Administrative Agent, desirable to perfect
the Administrative Agent's security interest therein, and (iii) if requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
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SECTION 7. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as any Loan or other amount
is owing to any Lender or the Administrative Agent hereunder, the Borrower shall
not, and shall not permit any Restricted Subsidiary to, directly or indirectly:
7.1 Indebtedness. Create, issue, incur, assume, become liable in
respect of or suffer to exist any Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan Document;
(b) Indebtedness of (i) the Borrower to any Subsidiary and of any
Guarantor (other than any Spectrum Entity) to the Borrower or any other
Subsidiary, (ii) any Spectrum Entity to the Borrower or any other Spectrum
Entity and (iii) any Restricted Subsidiary that is not a Guarantor to the
Borrower or any other Subsidiary (it being understood for the avoidance of doubt
that all such Indebtedness pursuant to this paragraph (b) shall be subject to
Section 7.6, as applicable (without limiting the generality thereof));
(c) (i) Guarantees incurred in the ordinary course of business or in
connection with the acquisition or lease of FCC License Rights by the Borrower
or any of its Subsidiaries (other than any Spectrum Entity) of obligations
(other than Indebtedness) of the Borrower or any Subsidiary, (ii) Guarantees by
the Borrower or any Guarantor (other than any Spectrum Entity) of Indebtedness
of the Borrower or any Restricted Subsidiary to the extent such Indebtedness is
otherwise permitted under this Section 7.1 and (iii) Guarantees by any
Restricted Subsidiary that is not a Guarantor of Indebtedness of any Restricted
Subsidiary that is not a Guarantor to the extent such Indebtedness is otherwise
permitted under this Section 7.1;
(d) Indebtedness outstanding on the date hereof and listed on Schedule
7.1(d) and any Permitted Refinancing Indebtedness in respect thereof;
(e) Indebtedness (including, without limitation, Capital Lease
Obligations) of the Borrower or any Restricted Subsidiary (other than any
Spectrum Entity) secured by Liens permitted by Section 7.2(2)(C) or 7.2(2)(D) in
an aggregate principal amount not to exceed $100,000,000 at any one time
outstanding;
(f) Indebtedness of the Borrower outstanding on the date hereof in
respect of the Existing Notes and Guarantees Obligations of any Restricted
Subsidiary (other than any Spectrum Entity) in respect of the Existing Notes,
provided that such Guarantee Obligations were created pursuant to the Existing
Notes Indenture, and, in either case, any Permitted Refinancing Indebtedness in
respect thereof;
(g) Indebtedness of the Borrower or any Restricted Subsidiary (other
than any Spectrum Entity) in an aggregate principal amount at any one time
outstanding (for the Borrower and all Restricted Subsidiaries) not to exceed an
amount equal to the sum of (i) $500,000,000 and (ii) 75% of the aggregate amount
of net proceeds of issuances of common stock of the Borrower on or after the
Closing Date not utilized for Restricted Payments pursuant to 7.6(b)(2) or
Investments pursuant to Section 7.6(b)(14), provided that (i) the Weighted
Average Life to Maturity of such Indebtedness at the time such Indebtedness is
incurred shall be at least six months greater than the Weighted Average Life to
Maturity of the Loans at such time (provided, however, that this clause (i)
shall not apply to an aggregate principal amount of up to $15,000,000 of
Indebtedness outstanding at any time pursuant to this paragraph (g)) and (ii)
notwithstanding anything to the contrary in the foregoing, the aggregate
outstanding principal amount
43
of all Indebtedness of Restricted Subsidiaries that are not Guarantors incurred
pursuant to this paragraph (g) shall not at any time exceed $300,000,000;
(h) Indebtedness of the Borrower or any Guarantor (other than any
Spectrum Entity) in an aggregate principal amount (for the Borrower and all
Guarantors) not to exceed $300,000,000 at any one time outstanding, provided
that (i) such Indebtedness shall be subordinated to the Obligations on terms
reasonably satisfactory to the Administrative Agent, (ii) no cash amounts
(whether in respect of interest or otherwise) are payable in respect of such
Indebtedness prior to the maturity thereof and (iii) the Weighted Average Life
to Maturity of such Indebtedness at the time such Indebtedness is incurred shall
be at least six months greater than the Weighted Average Life to Maturity of the
Loans at such time;
(i) additional Indebtedness of the Borrower or Guarantor (other than
any Spectrum Entity), provided that at the time of Incurrence thereof, the
Borrower's Consolidated Leverage Ratio as of the end of the most recently
completed four fiscal quarter period for which financial statements are
available (after giving pro forma effect to the Incurrence of such Indebtedness
and the use of proceeds thereof as if such events had occurred as of the
beginning of such period) shall not exceed 6.50:1.00;
(j) Indebtedness in respect of Hedging Obligations permitted pursuant
to Section 7.6(b)(9); and
(k) the incurrence of Indebtedness represented by letters of credit in
an aggregate face amount not to exceed $25,000,000 at any one time outstanding.
7.2 Limitation on Liens.
(1) In the case of any Spectrum Entity, create, incur, assume or
otherwise cause or suffer to exist or become effective any Lien (other than
Permitted Liens) on any of its property, whether now owned or hereafter
acquired.
(2) In the case of the Borrower or any Restricted Subsidiary that is
not a Spectrum Entity, create, incur, assume or otherwise cause or suffer to
exist or become effective any Lien on any of its property, whether now owned or
hereafter acquired, other than:
(A) Permitted Liens;
(B) (a) Liens created pursuant to the Pledge and Security
Agreements (as defined in the Existing Notes Indenture), securing
obligations in respect of the Existing Notes, (b) Liens on the Pledged
Collateral (as defined in the Existing Notes Indenture) securing
obligations in respect of the Existing Notes and (c) Liens created pursuant
to any Permitted Refinancing Indebtedness of the Existing Notes Indenture
(including any Restrictive Refinancing) affecting substantially the same
assets as the Liens described in the preceding clauses (a) and (b) (or any
other assets to the extent permitted pursuant to clause (2) of the
definition of "Permitted Liens");
(C) Liens on property existing at the time of acquisition thereof
by the Borrower or any Restricted Subsidiary, provided that such Liens were
in existence prior to the contemplation of such acquisition and do not
extend to any property other than the property so acquired;
(D) Liens securing Indebtedness of the Borrower or any other
Subsidiary incurred pursuant to Section 7.1(e) to finance the acquisition
of property (real or personal and
44
including FCC Licenses), provided that (i) such Liens shall be created
substantially simultaneously with the acquisition of such property, (ii)
such Liens do not at any time encumber any property other than the property
financed by such Indebtedness and (iii) the amount of Indebtedness secured
thereby is not increased;
(E) second-priority Liens on Collateral of the Borrower or any
Restricted Subsidiary, provided that (i) such Liens shall have a "silent"
second lien status on terms reasonably acceptable to the Administrative
Agent and (ii) the aggregate amount of the obligations secured thereby
shall at no time exceed $250,000,000;
(F) Liens on Capital Stock or assets of Unrestricted Subsidiaries
securing Indebtedness of such Unrestricted Subsidiaries;
(G) restricted cash securing Indebtedness under letters of credit
permitted under Section 7.1(k); and
(H) additional Liens on the property of any Restricted Subsidiary
created in the ordinary course of business in an aggregate amount not to
exceed $25,000,000 at any one time outstanding.
7.3 The Spectrum Entities. Sell, lease, exchange or otherwise transfer
(in one transaction or a series of related transactions) any Capital Stock in
any Spectrum Entity to any Person (unless such Person is a Spectrum Entity),
except for any such sales, leases or transfers which are Asset Sales permitted
under Section 7.4 of this Agreement. Except for Capital Stock of Spectrum
Entities sold, leased, exchanged or transferred in accordance with this Section
7.3, all Spectrum Entities shall remain, directly or indirectly, Wholly Owned
Subsidiaries of the Borrower and no Spectrum Entity shall change its
jurisdiction of incorporation or formation to any jurisdiction outside of the
United States.
7.4 Asset Sales of Spectrum Entities. In the case of any Spectrum
Entity, consummate an Asset Sale unless:
(1) the Spectrum Entities receive consideration at the time of such
Asset Sale at least equal to the Fair Market Value of the assets or Capital
Stock issued or sold or otherwise disposed of; and
(2) 100% of the consideration therefor is in the form of cash, Cash
Equivalents or Replacement Assets or a combination of the foregoing, all of
which shall be received by one or more Spectrum Entities. For purposes of this
100% limitation, any Designated Noncash Consideration received by a Spectrum
Entity in connection with an Asset Sale of Designated Spectrum, taken together
with all other Designated Noncash Consideration received that is at that time
outstanding, up to a maximum amount equal to 20% of all Designated Spectrum
sold, leased or otherwise transferred in any Asset Sale (with the Fair Market
Value of each item of Designated Noncash Consideration being measured at the
time received and without giving effect to subsequent changes in value) shall be
deemed to be cash.
After the receipt by any Spectrum Entity of any Net Proceeds from an
Asset Sale, such Spectrum Entity shall apply such Net Proceeds towards the
prepayment of the Loans as and to the extent required by Section 2.5:
Pursuant to the Guarantee and Collateral Agreement, the Administrative
Agent on behalf of the Lenders shall have a valid perfected first priority Lien
in any Replacement Assets or Net Proceeds received by the Spectrum Entities in
connection with any Asset Sale.
45
Pending the final application of any such Net Proceeds, the Spectrum
Entities, as applicable, shall maintain such Net Proceeds in cash or may invest
such Net Proceeds in Cash Equivalents. Such cash or Cash Equivalents, as the
case may be, shall be held in a segregated deposit account subject to a
perfected first priority Lien in favor of the Administrative Agent on behalf of
the Lenders pursuant to arrangements reasonably satisfactory to the
Administrative Agent providing for springing "control" after the occurrence and
during the continuance of a payment or bankruptcy Event of Default.
7.5 Asset Sales of Non-Spectrum Entities. In the case of the Borrower
and any Restricted Subsidiary (other than any Spectrum Entity), consummate an
Asset Sale unless:
(1) the Borrower or such Restricted Subsidiary, as applicable,
receives consideration at the time of such Asset Sale at least equal to the Fair
Market Value of the assets or equity interests issued or sold or otherwise
disposed of; and
(2) at least 75% of the consideration therefor received by the
Borrower or such Restricted Subsidiary, as applicable, is in the form of cash,
Cash Equivalents or Replacement Assets or a combination of the foregoing. For
purposes of this 75% limitation, each of the following will be deemed to be
cash:
(a) any liabilities (as shown on the Borrower's most recent
balance sheet) of the Borrower or such Restricted
Subsidiary, as applicable (other than contingent
liabilities, Indebtedness that is by its terms subordinated
to the Loans or the Guarantees thereof and liabilities to
the extent owed to the Borrower or any Restricted
Subsidiary), that are assumed by the transferee of any such
assets or equity interests pursuant to a written assignment
and assumption agreement that releases the Borrower or such
Restricted Subsidiary, as applicable, from further liability
therefor;
(b) any securities, notes or other obligations received by the
Borrower or such Restricted Subsidiary, as applicable, from
such transferee that are converted by the Borrower or such
Restricted Subsidiary, as applicable, into Cash Equivalents
or Replacement Assets within 180 days of the receipt thereof
(to the extent of the Cash Equivalents or Replacement Assets
received in that conversion); and
(c) any Designated Noncash Consideration received by the
Borrower or such Restricted Subsidiary, as applicable, in
such Asset Sale having an aggregate Fair Market Value, taken
together with all other Designated Noncash Consideration
received pursuant to this clause (c) that is at that time
outstanding does not exceed $50,000,000 (with the Fair
Market Value of each item of Designated Noncash
Consideration being measured at the time received and
without giving effect to subsequent changes in value).
After the receipt by the Borrower or any Restricted Subsidiary of any
Net Proceeds from any Asset Sale, the Borrower or such Restricted Subsidiary, as
applicable, shall apply such Net Proceeds as and to the extent required by
Section 2.5.
To the extent required pursuant to the Guarantee and Collateral
Agreement, the Administrative Agent on behalf of the Lenders shall have a valid
perfected first priority Lien in any
46
Replacement Assets or Net Proceeds received by the Borrower or any Restricted
Subsidiary in connection with any Asset Sale.
Pending the final application of any such Net Proceeds, the Borrower
or such Restricted Subsidiary, as applicable, shall maintain the Net Proceeds in
cash or may invest such Net Proceeds in Cash Equivalents. Except to the extent
prohibited by the terms of the Existing Indenture or any Restrictive
Refinancing, such cash or Cash Equivalents, as the case may be, shall be held in
a segregated deposit account subject to a perfected first priority Lien in favor
of the Administrative Agent on behalf of the Lenders pursuant to arrangements
reasonably satisfactory to the Administrative Agent providing for springing
"control" after the occurrence and during the continuance of a payment or
bankruptcy Event of Default.
7.6 Restricted Payments.
(a) (1) declare or pay (without duplication) any dividend or make any
other payment or distribution on account of the Borrower's or such Restricted
Subsidiary's Capital Stock (including, without limitation, any payment in
connection with any merger or consolidation involving the Borrower or such
Restricted Subsidiary) or to the direct or indirect holders of the Borrower's or
such Restricted Subsidiary Capital Stock in their capacity as such (other than
dividends, payments or distributions payable in Capital Stock (other than
Disqualified Stock) of the Borrower or such Restricted Subsidiary);
(2) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or
consolidation involving the Borrower or such Restricted Subsidiary) any
Capital Stock of the Borrower or such Restricted Subsidiary thereof held by
Persons other than the Borrower or such Restricted Subsidiary;
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value the Existing Notes or any
Indebtedness that is contractually subordinated to the Loans or any
Guarantee thereof, except a payment of interest or principal at the Stated
Maturity thereof (all such payments and other actions set forth in clauses
(1), (2) and (3) being collectively referred to as "Restricted Payments");
or
(4) make any advance, loan, extension of credit (by way of
guaranty or otherwise) or capital contribution to, or purchase any Capital
Stock, bonds, notes, debentures or other debt securities of, or any assets
constituting a business unit of, or make any other investment in, any
Person (all of the foregoing in this clause (4), "Investments").
(b) The preceding provisions will not prohibit:
(1) Restricted Subsidiaries from declaring and paying dividends
ratably with respect to their Capital Stock;
(2) the making of any Restricted Payment with or in exchange for,
or out of the net cash proceeds of (without duplication of any amounts
included for purposes of Section 7.1(g) or Section 7.6(b)(14)) a
contribution to the common equity of the Borrower or a sale (other than to
a Subsidiary of the Borrower) of, Capital Stock (other than Disqualified
Stock) of the Borrower;
(3) the repurchase of Capital Stock of the Borrower or such
Restricted Subsidiary deemed to occur upon the exercise of options or
warrants to the extent that such Capital Stock represents all or a portion
of the exercise price thereof;
47
(4) the repurchase of Capital Stock of the Borrower or such
Restricted Subsidiary constituting fractional shares;
(5) the defeasance, redemption, repurchase or other acquisition
of the Existing Notes or any Indebtedness subordinated to the Loans or the
Guarantees thereof, in either case with the net cash proceeds from an
Incurrence of Permitted Refinancing Indebtedness;
(6) the repurchase, redemption or other acquisition or retirement
for value of any Capital Stock of the Borrower or such Restricted
Subsidiary held by any current or former employee, consultant or director
of the Borrower pursuant to the terms of any employee equity subscription
agreement, stock option agreement or similar agreement approved by a
majority of the disinterested members of the Board of Directors of the
Borrower;
(7) Restricted Payments or Investments pursuant to agreements or
arrangements in effect on the Closing Date;
(8) extensions of trade credit in the ordinary course of
business;
(9) Hedging Obligations that are incurred for the purpose of
fixing, hedging or swapping interest rate, commodity price or foreign
currency exchange rate risk (or reverse or amend any such agreements
previously made for such purpose), and not for speculative purposes;
(10) Investments acquired by the Borrower or a Restricted
Subsidiary (a) in exchange for any other Investment or accounts receivable
held by the Borrower or such Restricted Subsidiary in connection with or as
a result of a bankruptcy, workout, reorganization or recapitalization of
the issuer of such other Investment or accounts receivable or (b) as a
result of a foreclosure by the Borrower or any Restricted Subsidiary with
respect to any secured Investment or other transfer of title with respect
to any secured Investment in default;
(11) Investments in Cash Equivalents;
(12) Guarantees permitted by Section 7.1 and guarantees incurred
in the ordinary course of business or in connection with the acquisition or
lease of FCC License Rights by the Borrower or any of its Subsidiaries
(other than any Spectrum Entity) of obligations of the Borrower or any
Subsidiary;
(13) loans and advances to customers or suppliers in the ordinary
course of business that are, in conformity with GAAP, recorded as accounts
receivable, prepaid expenses or deposits on the balance sheet of the
Borrower or a Restricted Subsidiary and endorsements for collection or
deposit arising in the ordinary course of business;
(14) Investments consisting of purchases and acquisition of
inventory, supplies, materials and equipment or purchase of contract rights
or licenses or leases of intellectual property, in each case in the
ordinary course of business;
(15) loans and advances to employees of the Borrower or any
Restricted Subsidiary (x) in the ordinary course of business for relocation
and similar expenses, and (y) in an aggregate amount for the Borrower and
all Restricted Subsidiaries not to exceed $5,000,000 pursuant to this
clause (y) at any one time outstanding;
48
(16) commission, payroll, travel, entertainment and similar
advances to officers and employees of the Borrower or any Subsidiary that
are expected at the time of such advance ultimately to be recorded as an
expense in conformity with GAAP;
(17) Investments consisting of the licensing or contribution of
intellectual property pursuant to joint marketing arrangements with other
Persons;
(18) Investments in Replacement Assets made by the Borrower or
any of its Restricted Subsidiaries with the proceeds of any asset
disposition permitted pursuant to, or not prohibited by, Sections 7.4 or
7.5, or in exchange for asset disposed of pursuant to, or not prohibited
by, Sections 7.4 or 7.5;
(19) any Investment (i) by the Borrower or any Restricted
Subsidiary in the Borrower, any Guarantor or any Person, if as a result of
such Investment, such Person becomes a Guarantor or such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into the Borrower or a
Guarantor or (ii) by the Borrower or any Restricted Subsidiary in any other
Restricted Subsidiary to the extent necessary to fund obligations owing by
such other Restricted Subsidiary with respect to any FCC License Rights;
(20) Investments (i) made with the proceeds of any issuance of
common stock of the Borrower on or after the Closing Date, without
duplication of any amounts included for purposes of determining the amount
of Indebtedness permitted under Section 7.1(g) or (ii) made and funded
directly with Capital Stock (other than Disqualified Stock) of the
Borrower;
(21) Investments in any Unrestricted Subsidiary to be used for
general corporate purposes and in an aggregate amount not to exceed
$25,000,000 during the term of this Agreement;
(22) in addition to Investments otherwise expressly permitted by
this Section, Investments in Subsidiaries in an amount not to exceed
$350,000,000 in the aggregate during the term of this Agreement; and
(23) the amount of any distributions, repayments, interest,
profits, income and returns made to any Loan Party by any Unrestricted
Subsidiaries, minority interests, or Restricted Subsidiaries that are not
Guarantors.
Notwithstanding the foregoing, no Spectrum Entity shall at any time pay a
dividend or make any payment or distribution to any entity that is not a
Spectrum Entity unless the proceeds of such dividend or distribution is applied
in its entirety to prepay the Loans; provided that, any Spectrum Entity may pay
a dividend or make payments and distributions to the Borrower so that the
Borrower may pay its combined, consolidated or unitary tax liabilities and any
franchise tax liabilities, so long as the Borrower uses the dividend, payment or
distribution to pay such taxes at such time.
7.7 Mergers, Consolidation, etc. (a) The Borrower shall not
consolidate with or merge into any other Person (in a transaction in which the
Borrower is not the surviving corporation) or convey, transfer or lease or
otherwise dispose of its properties and assets substantially as an entirety (in
one or more related transactions) to any other Person, unless:
(1) in case the Borrower shall consolidate with or merge into
another Person (in a transaction in which the Borrower is
not the surviving corporation)
49
or convey, transfer, lease or otherwise dispose of its
properties and assets substantially as an entirety to any
Person, the Person formed by such consolidation or into
which the Borrower is merged or the Person which acquires by
conveyance or transfer, or which leases, the properties and
assets of the Borrower substantially as an entirety is a
corporation, limited liability Borrower, partnership, trust
or other entity, is organized and validly existing under the
laws of the United States of America or any State thereof
and shall expressly assume, by an amendment hereto, executed
and delivered to the Administration Agent, in form
satisfactory to the Administrative Agent, the due and
punctual payment of the principal of and any premium and
interest on all the Loans and the performance or observance
of every covenant of this Agreement on the part of the
Borrower to be performed or observed by the Person (if other
than the Borrower) formed by such consolidation or into
which the Borrower shall have been merged or by the Person
which shall have acquired the Borrower's assets; and
(2) immediately after giving effect to such transaction, no
Event of Default or Default shall have happened and be
continuing; and
(3) each Guarantor, unless such Guarantor is the Person with
which the Borrower has entered into a transaction under this
covenant, will have by amendment to the Guarantee and
Collateral Agreement confirmed that its Guarantee will apply
to the obligations of the Borrower or the surviving Person
in accordance with the Loans and this Agreement; and
(4) the Borrower has delivered to the Administrative Agent an
Officers' Certificate and an Opinion of Counsel, each
stating that such consolidation, merger, conveyance,
transfer or lease and, if an amendment is required in
connection with such transaction, such amendment comply with
this Article 7 and Section 10.1 and that all conditions
precedent herein provided or relating to such transaction
have been complied with.
The provisions of this Section 7.7 shall similarly apply to successive
consolidations, mergers, sales or conveyances. Notwithstanding the foregoing,
other than as permitted under Section 7.4 or 7.5, as applicable, the Borrower
shall not convey, lease or otherwise dispose of or transfer any of its Capital
Stock in the Spectrum Entities and their respective successors to, or permit any
merger or consolidation of any Spectrum Entity with or into, any other Person
other than a wholly owned Subsidiary that is or becomes a Guarantor, and, in
each case, has pledged all of such Capital Stock to the Administrative Agent
pursuant to the Guarantee and Collateral Agreement unless the proceeds thereof
are received in cash, represent the fair market value of such Spectrum Entity or
Capital Stock, as applicable, and are used by repay the Loans in accordance with
Section 2.5.
Upon any consolidation of the Borrower with, or merger of the Borrower
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Borrower substantially as an entirety in accordance with this
Section 7.7, the successor Person formed by such consolidation or into which the
Borrower is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Borrower under this Agreement with the same effect as if such successor
Person had been named as the Borrower herein, and thereafter,
50
except in the case of a lease, the predecessor Person shall be relieved of all
obligations and covenants under this Agreement and the Loan Documents.
7.8 Transactions With Affiliates. Make any payment to, or sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or purchase
any property or assets from, or enter into, make, amend, renew or extend any
transaction, contract, agreement, understanding, loan, advance or Guarantee
with, or for the benefit of, any Affiliate (each, an "Affiliate Transaction"),
unless:
(1) such Affiliate Transaction is on terms that are no less favorable
to the Borrower or the relevant Restricted Subsidiary than those that would have
been obtained in a comparable arm's-length transaction by the Borrower or such
Restricted Subsidiary with a Person that is not an Affiliate of the Borrower or
any of its Restricted Subsidiaries; and
(2) the Borrower delivers to the Administrative Agent:
(a) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate
consideration in excess of $5,000,000, a Board Resolution
set forth in an Officers' Certificate certifying that such
Affiliate Transaction or series of related Affiliate
Transactions complies with this covenant; and
(b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate
consideration in excess of $50,000,000, an opinion as to the
fairness to the Borrower or such Restricted Subsidiary of
such Affiliate Transaction or series of related Affiliate
Transactions from a financial point of view issued by an
independent accounting, appraisal or investment banking firm
of national standing.
The following items will not be deemed to be Affiliate Transactions
(except with respect to any transaction involving a Spectrum Entity that is not
expressly permitted pursuant to another Section of this Agreement) and,
therefore, will not be subject to the provisions of the prior paragraph:
(1) transactions between or among the Borrower and/or its Restricted
Subsidiaries or any Person that will become a Restricted Subsidiary as part of
any such transactions; provided that transactions between or among the Borrower,
any Restricted Subsidiary and any Foreign Subsidiaries shall not be deemed to be
Affiliate Transactions if such transactions are, in the good faith determination
of the Board of Directors of the Borrower, or are certified in writing by senior
management of the Borrower as being, in the best interests of the Borrower and
are on terms that are at least as favorable to the Borrower and/or any
Restricted Subsidiary than those that can be obtained in a comparable
arm's-length transaction with a Person that is not an Affiliate of the Borrower
or any Restricted Subsidiary;
(2) payment of reasonable and customary fees to, and reasonable and
customary indemnification and similar payments on behalf of, directors of the
Borrower;
(3) Restricted Payments and Investments that are permitted by Section
7.6;
(4) dispositions of property by Restricted Subsidiaries or the
Borrower to the Borrower or any Subsidiaries that are permitted by, and in
accordance with, Section 7.4 or 7.5, as applicable;
51
(5) any sale of Capital Stock of the Restricted Subsidiaries permitted
by Section 7.4 or 7.5, as applicable, or of the Borrower;
(6) transactions pursuant to agreements or arrangements in effect on
the Closing Date, or any amendment, modification, or supplement thereto or
replacement thereof, as long as such agreement or arrangement, as so amended,
modified, supplemented or replaced, taken as a whole, is not materially more
disadvantageous to the Borrower and its Restricted Subsidiaries than the
original agreement or arrangement in existence on the Closing Date;
(7) any employment, consulting, service or termination agreement, or
reasonable and customary indemnification arrangements, entered into by the
Borrower or any of its Subsidiaries with officers and employees of the Borrower
or any of its Subsidiaries and the payment of compensation to officers and
employees of the Borrower or any of its Subsidiaries (including amounts paid
pursuant to employee benefit plans, employee stock option or similar plans), so
long as such agreement or payment has been approved by a majority of the
disinterested members of the Board of Directors of the Borrower;
(8) subject to Section 7.6, as applicable, payments or loans to
employees or consultants in the ordinary course of business which are approved
by a majority of the disinterested members of the Board of Directors of the
Borrower in good faith;
(9) transactions with Motorola and Intel pursuant to commercial
agreements in place on the Closing Date and reasonable modifications or
extensions thereof which are approved by a majority of the disinterested members
of the Board of Directors of the Borrower in good faith; and
(10) transactions with customers, clients, suppliers or purchasers or
sellers of goods or services, in each case in the ordinary course of business
and otherwise in compliance with the terms of this Agreement, which are fair to
the Borrower and its Restricted Subsidiaries in the determination of the Board
of Directors or the senior management of the Borrower, or are on terms at least
as favorable as might reasonably have been obtained at such time from an
unaffiliated party.
7.9 Limitation On Sale and Leaseback Transactions. Enter into any Sale
and Leaseback Transaction; provided that the Borrower or any Restricted
Subsidiary thereof may enter into a Sale and Leaseback Transaction if:
(1) if applicable, the Borrower or such Restricted Subsidiary, as
applicable, could have Incurred such Indebtedness under Section
7.1 or Section 7.2 in an amount equal to the Attributable Debt
relating to such Sale and Leaseback Transaction;
(2) the gross cash proceeds of that Sale and Leaseback Transaction
are at least equal to the Fair Market Value of the property that
is the subject of that Sale and Leaseback Transaction;
(3) the transfer of assets in such Sale and Leaseback Transaction is
permitted by, and the Borrower applies the proceeds of such
transaction in compliance with Section 7.4 or Section 7.5, as
applicable; and
(4) the assets transferred in such Sale and Leaseback Transaction are
not Collateral.
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7.10 Designation of Restricted and Unrestricted Subsidiaries.
(a) Designate any Restricted Subsidiary of the Borrower to be an
Unrestricted Subsidiary except in accordance with this Section 7.10. The Board
of Directors of the Borrower may designate any Restricted Subsidiary of the
Borrower to be an Unrestricted Subsidiary; provided that:
(1) any Guarantee by the Borrower or any Restricted Subsidiary
thereof of any Indebtedness of the Subsidiary being so
designated shall be deemed to be an Incurrence of
Indebtedness by the Borrower or such Restricted Subsidiary
(or both, if applicable) at the time of such designation,
and such Incurrence of Indebtedness would be permitted under
Section 7.1;
(2) except as would be permitted under Section 7.8, the
Subsidiary being so designated is not party to any
agreement, contract, arrangement or understanding with the
Borrower or any Restricted Subsidiary thereof unless either
(A) such agreement, contract, arrangement or understanding
is with customers, clients, suppliers or purchasers or
sellers of goods or services, in each case in the ordinary
course of business and otherwise in compliance with the
terms of this Agreement, which are fair to the Borrower and
its Restricted Subsidiaries in the determination of the
Board of Directors or the senior management of the Borrower,
(B) the terms of any such agreement, contract, arrangement
or understanding are no less favorable to the Borrower or
such Restricted Subsidiary than those that might be obtained
at the time from Persons who are not Affiliates of the
Borrower, or (C) any such guaranty by Borrower or any
Restricted Subsidiary of Indebtedness or obligations of any
such Subsidiary is permitted under Sections 7.1 and 7.6;
(3) no Default or Event of Default would be in existence
following such designation; and
(4) all Subsidiaries (if any) of the Subsidiary being so
designated shall also be designated as Unrestricted
Subsidiaries and each such other designation shall comply
with this Section 7.10.
(b) Any designation of a Restricted Subsidiary of the Borrower as an
Unrestricted Subsidiary shall be evidenced to the Administrative Agent by
delivering to the Administrative Agent the Board Resolution giving effect to
such designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by this Agreement. If,
at any time, any Unrestricted Subsidiary would fail to meet any of the preceding
requirements described in Section 7.10(a)(2), it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness,
Investments, or Liens on the property, of such Subsidiary shall be deemed to be
Incurred or made by a Restricted Subsidiary of the Borrower as of such date and,
if such Indebtedness, Investments or Liens are not permitted to be Incurred or
made as of such date under this Agreement, the Borrower shall be in default
under this Agreement.
(c) The Board of Directors of the Borrower may at any time designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that:
(1) such designation shall be deemed to be an Incurrence of any
outstanding Indebtedness (including any Non-Recourse Debt)
of such Unrestricted
53
Subsidiary by such Restricted Subsidiary and such
designation shall only be permitted if such Indebtedness is
permitted under Section 7.1;
(2) no Default or Event of Default would be in existence
following such designation;
(3) any Unrestricted Subsidiary that was previously a Restricted
Subsidiary may be designated back to being a Restricted
Subsidiary only once; and
(4) any amounts previously utilized for Investments by Borrower
or any Restricted Subsidiary pursuant to Section 7.6(b) in
such Unrestricted Subsidiary shall be thereafter added back
to the amount of Investments permitted to be made under the
relevant baskets pursuant to which such Investment was
originally made.
7.11 ESC Compliance. If at any time less than 85% of the aggregate
Spectrum Rights of the Spectrum Entities are ESC-compliant based upon the
compliance percentage assessed on the basis of FCC License or Underlying License
(as defined below), as the case may be, from which the Spectrum Rights are
derived, as provided in this Section 7.11, then the Borrower will take all
commercially reasonable efforts to bring the Spectrum Rights into at least 85%
ESC compliant within 90 days.
For purposes of this Section 7.11, "Spectrum Rights" means the present
effective right of the Spectrum Entities to use a defined portion of the
radiofrequency spectrum within a Geographic Service Area (as defined below) in
the conduct of the business of the Borrower, including rights directly from FCC
Licenses and rights under Spectrum Leases with FCC licensees of such spectrum.
"Underlying License" means the license granted by the FCC to the
lessor to the Spectrum Entities under a Spectrum Lease.
"Geographic Service Area" means either the area for incumbent
site-based licensees that is bounded by a circle having a 35 mile radius and
centered at the station's reference coordinates, which was the previous
protected service area to which incumbent licensees were entitled prior to
January 10, 2005, and is bounded by the chords drawn between intersection points
of the licensee's previous 35 mile protected service area and those of
respective adjacent market co-channel licensees or a BTA that is licensed to the
respective BRS/BTA authorization holder subject to the exclusion of overlapping
co-channel incumbent geographic service area.
"Effective Spectrum Criteria" (or "ESC") means,
(a) with respect to Spectrum Rights in the form of an FCC License,
that a Spectrum Entity holds the FCC License and that the FCC License is
currently effective in accordance with its terms and authorizes the present use
of the entire portion of the radiofrequency specified in such FCC License for
use by the Spectrum Entities throughout the entirety of the Geographic Service
Area specified in such FCC License without any further authorization from the
FCC, except to the extent that a change in FCC rules or policies affects the
ability of a Spectrum Entity to use the entire portion of the radiofrequency
specified in such FCC License; and
(b) with respect to Spectrum Rights in the form of a Spectrum Lease:
(1) The lessor under the spectrum lease (or, in the case of a
sublease, the sublessor's lessor) is the authorized holder
of an FCC License that is
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currently effective in accordance with its terms and
authorizes the present use of the entire portion of the
radiofrequency specified in such FCC License throughout the
entirety of the Geographic Service Area specified in such
FCC License without any further authorization from the FCC,
except to the extent that a change in FCC rules or policies
affects the ability of a Spectrum Entity to use the entire
portion of the radiofrequency specified in such spectrum
lease;
(2) The Geographic Service Area and the portion of the
radiofrequency spectrum authorized for use by the lessor in
the FCC License held by the lessor includes the entirety of
both the Geographic Service Area and the portion of the
radiofrequency spectrum specified in the Spectrum Lease; and
the FCC License permits the lessor to lease and the Spectrum
Lease validly leases to the Spectrum Entity that is a party
thereto the entire portion of the radiofrequency spectrum
specified in the Spectrum Lease throughout the entire
Geographic Service Area specified in such Spectrum Lease for
use by such Spectrum Entity in its business; except to the
extent that a change in FCC rules or policies affects the
ability of a Spectrum Entity to use the entire portion of
the radiofrequency specified in such Spectrum Lease; and
(3) Either
(a) the spectrum lease is of a type and category that
requires FCC approval to be valid and has currently
effective FCC approval, or
(b) the spectrum lease is not of a type and category that
requires FCC approval.
The compliance percentage for purposes of this covenant shall be
derived from a fraction, the denominator of which is the total number of the
Underlying Licenses and FCC Licenses from which the Spectrum Rights derive
(based on separate call signs), whether derived directly or by Spectrum Lease,
and the numerator of which is the number of Underlying Licenses and FCC Licenses
for which the Spectrum Rights derived therefrom are ESC-compliant.
7.12 Stay, Extension ad Usury Laws. At any time insist upon, plead, or
in any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law or other law which would prohibit or forgive any Loan
Party from paying all or any portion of the principal of, premium, if any, or
interest, on the Loans as contemplated herein, wherever enacted, now or at any
time hereafter in force, or which may affect the covenants or the performance of
this Agreement, and the Borrower hereby, on its own behalf and on behalf of each
Restricted Subsidiary (to the extent it may lawfully do so), hereby expressly
waives all benefit or advantage of any such law and covenants that it will not,
by resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Administrative Agent or any Lender, but will suffer and
permit the execution of every such power as though no such law had been enacted.
7.13 Business Activities. Engage in any business other than Permitted
Businesses, except to such extent as would not be material to the Borrower and
its Restricted Subsidiaries taken as a whole.
7.14 Swap Agreements. Enter into any Swap Agreement for speculative
purposes.
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7.15 Changes in Fiscal Periods. Permit the fiscal year of the Borrower
to end on a day other than December 31 or change the Borrower's method of
determining fiscal quarters.
7.16 Amendments to Certain Documents. Amend, supplement or otherwise
modify (pursuant to a waiver or otherwise) (i) the Existing Notes Indenture,
(ii) the Pledge and Security Agreements (as defined in the Existing Notes
Indenture), (iii) any agreement with respect to any Restrictive Refinancing or
(iv) the terms or conditions of any Spectrum Lease with respect to Designated
Spectrum, in each case in a manner that would be materially adverse to the
interests of the Lenders.
7.17 Activities of Holders of Designated Spectrum. In the case of any
Spectrum Entity, notwithstanding anything to the contrary herein, conduct,
transact or otherwise engage in any business or operations other than (i) its
ownership or lease of Designated Spectrum or Replacement Assets in respect
thereof, (ii) the issuance of and performance of its obligations in respect of
its Capital Stock, (iii) the payment of dividends and taxes, (iv) performance of
its obligations hereunder and under the other Loan Documents and the other
agreements contemplated thereby, (v) action required by law to maintain its
existence and (vi) activities incidental to its maintenance and continuance and
to any of the foregoing activities.
SECTION 8. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of any Loan when due
in accordance with the terms hereof; or the Borrower shall fail to pay any
interest on any Loan, or any other amount payable hereunder or under any other
Loan Document, within three Business Days after any such interest or other
amount becomes due in accordance with the terms hereof; or
(b) any representation or warranty made or deemed made by any Loan
Party herein or in any other Loan Document or that is contained in any
certificate, document or financial or other statement furnished by it at any
time under or in connection with this Agreement or any such other Loan Document
shall prove to have been inaccurate in any material respect on or as of the date
made or deemed made; or
(c) any Loan Party shall default in the observance or performance of
any agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to
the Borrower only), Section 6.7(a), Sections 7.1 through 7.7 or Section 7.16 of
this Agreement or Sections 5.4 and 5.6(b) of the Guarantee and Collateral
Agreement; or
(d) any Loan Party shall default in the observance or performance of
any other agreement contained in this Agreement or any other Loan Document
(other than as provided in paragraphs (a) through (c) of this Section), and such
default shall continue unremedied for a period of 30 days after notice to the
Borrower from the Administrative Agent or the Required Lenders; or
(e) the Borrower, any Restricted Subsidiary or any Specified
Unrestricted Subsidiary shall (i) default in making any payment of any principal
of any Indebtedness (including any Guarantee, but excluding the Loans) on the
scheduled or original due date with respect thereto after giving effect to any
period of grace provided in the instrument or agreement evidencing, securing or
relating thereto; or (ii) default in making any payment of any interest on any
such Indebtedness beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created; or (iii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
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permit the holder or beneficiary of such Indebtedness (or a trustee or agent on
behalf of such holder or beneficiary) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or (in
the case of any such Indebtedness constituting a Guarantee Obligation) to become
payable; provided, that a default, event or condition described in clause (i),
(ii) or (iii) of this paragraph (e) shall not at any time constitute an Event of
Default unless, at such time, one or more defaults, events or conditions of the
type described in clauses (i), (ii) and (iii) of this paragraph (e) shall have
occurred and be continuing with respect to Indebtedness the outstanding
principal amount of which exceeds in the aggregate $25,000,000; or
(f) (i) the Borrower, or any Restricted Subsidiary whose total assets,
when taken together with those of any other Restricted Subsidiaries with a
Bankruptcy Event, exceed $10,000,000, shall in either case commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or the
Borrower or any Restricted Subsidiary shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower
or any Restricted Subsidiary any case, proceeding or other action of a nature
referred to in clause (i) above that (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed or
undischarged for a period of 60 days; or (iii) there shall be commenced against
any Group Member any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar process against all or
any substantial part of its assets that results in the entry of an order for any
such relief that shall not have been vacated, discharged, or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) the Borrower or
any Restricted Subsidiary shall take any action in furtherance of, or indicating
its consent to, approval of, or acquiescence in, any of the acts set forth in
clause (i), (ii), or (iii) above; or (v) the Borrower or any Restricted
Subsidiary shall generally not, or shall be unable to, or shall admit in writing
its inability to, pay its debts as they become due; or
(g) (i) any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan shall arise on the assets of the Borrower or any
Restricted Subsidiary or any Commonly Controlled Entity, (iii) a Reportable
Event shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is, in the reasonable opinion of the
Required Lenders, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Plan shall terminate, other than pursuant to a
"standard termination" in accordance with Section 4041(b) of ERISA, for purposes
of Title IV of ERISA, (v) the Borrower or any Restricted Subsidiary or any
Commonly Controlled Entity shall, or in the reasonable opinion of the Required
Lenders is likely to, incur any liability in connection with a withdrawal from,
or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any other
event or condition shall occur or exist with respect to a Plan; and in each case
in clauses (i) through (vi) above, such event or condition, together with all
other such events or conditions, if any, could reasonably be expected to have a
Material Adverse Effect; or
(h) one or more judgments or decrees shall be entered against the
Borrower or any Restricted Subsidiary involving in the aggregate a liability
(not subject to appeal and not covered by insurance as to which the relevant
insurance company has acknowledged coverage) of $25,000,000 or
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more, and all such judgments or decrees shall not have been vacated, discharged,
paid, stayed or bonded pending appeal within 60days from the entry thereof; or
(i) any of the Security Documents shall cease, for any reason, to be
in full force and effect, or any Loan Party or any Affiliate of any Loan Party
shall so assert, or any Lien created by any of the Security Documents shall
cease to be enforceable and of the same effect and priority purported to be
created thereby, in each case with respect to a portion of Collateral in excess
of $10,000,000; or
(j) the guarantee contained in Section 2 of the Guarantee and
Collateral Agreement shall cease, for any reason, to be in full force and effect
or any Loan Party shall so assert;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Loans (with accrued interest thereon) and all other amounts
owing under this Agreement and the other Loan Documents shall immediately become
due and payable, and (B) if such event is any other Event of Default, with the
consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Borrower declare the Loans (with accrued interest thereon) and all other
amounts owing under this Agreement and the other Loan Documents to be due and
payable forthwith, whereupon the same shall immediately become due and payable.
Except as expressly provided above in this Section, presentment, demand, protest
and all other notices of any kind are hereby expressly waived by the Borrower.
SECTION 9. THE AGENTS
9.1 Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
9.2 Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions. Neither any Agent nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found by
a final decision of a court of competent jurisdiction to have resulted from its
or such Person's or their related parties' own gross negligence, bad faith or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by any Loan Party
or any officer thereof contained in this Agreement or any other Loan Document or
in any certificate, report, statement or other document referred to or provided
for in, or received by the Agents under or in connection with, this
58
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of any Loan Party a party thereto to perform its
obligations hereunder or thereunder. The Agents shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of any Loan Party.
9.4 Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any
instrument, writing, resolution, notice, consent, certificate, affidavit,
letter, telecopy, telex or teletype message, statement, order or other document
or conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders (or, if so specified
by this Agreement, all Lenders) as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take any
such action. The Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the other Loan
Documents in accordance with a request of the Required Lenders (or, if so
specified by this Agreement, all Lenders), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.
9.5 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent has received notice from a Lender or the
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders (or, if so specified by this Agreement, all
Lenders); provided that unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
9.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports
59
and other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
9.7 Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Percentages in effect on the date on which indemnification is sought
under this Section (or, if indemnification is sought after the date upon which
the Loans shall have been paid in full, ratably in accordance with such
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final decision of a court of competent
jurisdiction to have resulted from such Agent's gross negligence, bad faith or
willful misconduct. The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder.
9.8 Agent in Its Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with any Loan Party as though such Agent were not an Agent. With
respect to its Loans made or renewed by it, each Agent shall have the same
rights and powers under this Agreement and the other Loan Documents as any
Lender and may exercise the same as though it were not an Agent, and the terms
"Lender" and "Lenders" shall include each Agent in its individual capacity.
9.9 Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or Section
8(f) with respect to the Borrower shall have occurred and be continuing) be
subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. If no successor agent
has accepted appointment as Administrative Agent by the date that is 30 days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become
effective, and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above. After any retiring
Administrative Agent's resignation as Administrative Agent, the provisions of
this Section 9 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement and the
other Loan Documents.
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9.10 Documentation Agent and Syndication Agent. Neither the
Documentation Agent nor the Syndication Agent shall have any duties or
responsibilities hereunder in its capacity as such.
SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement, any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party to the relevant Loan Document may, or, with
the written consent of the Required Lenders, the Administrative Agent and each
Loan Party to the relevant Loan Document may, from time to time, (a) enter into
written amendments, supplements or modifications hereto and to the other Loan
Documents (including amendments and restatements hereof or thereof) for the
purpose of adding any provisions to this Agreement or the other Loan Documents
or changing in any manner the rights of the Lenders or of the Loan Parties
hereunder or thereunder or (b) waive, on such terms and conditions as the
Required Lenders or the Administrative Agent, as the case may be, may specify in
such instrument, any of the requirements of this Agreement or the other Loan
Documents or any Default or Event of Default and its consequences; provided,
however, that no such waiver and no such amendment, supplement or modification
shall (i) forgive the principal amount or extend the final scheduled date of
maturity of any Loan, extend the scheduled date of any amortization payment in
respect of any Loan, reduce the stated rate of any interest or fee payable
hereunder (except in connection with the waiver of applicability of any
post-default increase in interest rates (which waiver shall be effective with
the consent of the Required Lenders)) or extend the scheduled date of payment
thereof, in each case without the written consent of each Lender directly
affected thereby; (ii) eliminate or reduce the voting rights of any Lender under
this Section 10.1 without the written consent of such Lender; (iii) reduce any
percentage specified in the definition of Required Lenders, consent to the
assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement and the other Loan Documents, release all or substantially
all of the Collateral, or release Guarantors from their obligations under the
Guarantee and Collateral Agreement if such Guarantors represent substantially
all of the value of the Guarantee under the Guarantee and Collateral Agreement,
in each case without the written consent of all Lenders; or (iv) amend, modify
or waive any provision of Section 9 without the written consent of the
Administrative Agent. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall be binding
upon the Loan Parties, the Lenders, the Administrative Agent and all future
holders of the Loans. In the case of any waiver, the Loan Parties, the Lenders
and the Administrative Agent shall be restored to their former position and
rights hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
Notwithstanding the foregoing, this Agreement may be amended (or
amended and restated) with the written consent of the Required Lenders, the
Administrative Agent and the Borrower (a) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time to
time outstanding thereunder and the accrued interest and fees in respect thereof
to share ratably in the benefits of this Agreement and the other Loan Documents
with the Loans the accrued interest in respect thereof and (b) to include
appropriately the Lenders holding such credit facilities in any determination of
the Required Lenders.
If, in connection with any proposed change, waiver, discharge or
termination of the provisions of this Agreement as contemplated by this Section
10.01, the consent of the Required Lenders is obtained but the consent of one or
more of such other Lenders whose consent is required is not obtained, then the
Borrower shall have the right to replace all non-consenting Lenders required to
obtain such consent with one or more Eligible Assignees in accordance with
Section 10.6, so long as at the time
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of such replacement each such new Lender consents to the proposed change,
waiver, discharge or termination.
10.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower and the
Administrative Agent, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:
Borrower: Clearwire Corporation
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Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Clearwire Corporation
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Attention: Legal Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
Citigroup Center
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Administrative Agent: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇/7250
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇/7435
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
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Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Section 2 unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans and other extensions of credit hereunder.
10.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all its reasonable and documented
out-of-pocket costs and expenses incurred in connection with the development,
preparation and execution of, and any amendment, supplement or modification to,
this Agreement and the other Loan Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including the reasonable fees and
disbursements of one counsel for each relevant jurisdiction to the
Administrative Agent and filing and recording fees and expenses, with statements
with respect to the foregoing to be submitted to the Borrower prior to the
Closing Date (in the case of amounts to be paid on the Closing Date) and from
time to time thereafter on a quarterly basis or such other periodic basis as the
Administrative Agent shall deem appropriate, (b) to pay or reimburse each Lender
and the Administrative Agent for all its reasonable costs and expenses incurred
in connection with the enforcement or preservation of any rights under this
Agreement, the other Loan Documents and any such other documents, including the
fees and disbursements of one counsel to the Lenders and the Administrative
Agent, (c) to pay, indemnify, and hold each Lender and the Administrative Agent
and their respective officers, directors, employees, affiliates, agents and
controlling persons (each, an "Indemnitee") harmless from and against any and
all other actual liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, and related reasonable and documented out of pocket costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including any
of the foregoing relating to the use of proceeds of the Loans or the violation
of, noncompliance with or liability under, any Environmental Law applicable to
the operations of any Group Member or any of the Properties and the reasonable
fees and expenses of one legal counsel in connection with claims, actions or
proceedings by any Indemnitee against any Loan Party under any Loan Document
(all the foregoing in this clause (d), collectively, the "Indemnified
Liabilities"), provided, that the Borrower shall have no obligation hereunder to
any Indemnitee with respect to Indemnified Liabilities to the extent such
Indemnified Liabilities are found by a final decision of a court of competent
jurisdiction to have resulted from the gross negligence, bad faith or willful
misconduct of any Indemnitee. Without limiting the foregoing, and to the extent
permitted by applicable law, the Borrower agrees not to assert and to cause its
Subsidiaries not to assert, and hereby waives and agrees to cause its
Subsidiaries to waive, all rights for contribution or any other rights of
recovery with respect to all claims, demands, penalties,
63
fines, liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any Indemnitee. All amounts due under this Section
10.5 shall be payable not later than 10 days after written demand therefor.
Statements payable by the Borrower pursuant to this Section 10.5(e) shall be
submitted to ▇▇▇▇ ▇▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇), at the address of the
Borrower set forth in Section 10.2, or to such other Person or address as may be
hereafter designated by the Borrower in a written notice to the Administrative
Agent. The agreements in this Section 10.5(d) shall survive repayment of the
Loans and all other amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments
(a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that (i) the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by the Borrower
without such consent shall be null and void) and (ii) no Lender may assign or
otherwise transfer its rights or obligations hereunder except in accordance with
this Section.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees (each, an "Assignee") all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Commitments and the Loans at the time owing to it) with the
prior written consent of:
(A) the Borrower (such consent not to be unreasonably
withheld), provided that no consent of the Borrower
shall be required for an assignment to a Lender, an
affiliate of a Lender, an Approved Fund (as defined
below) or, if an Event of Default has occurred and is
continuing, any other Person; and
(B) the Administrative Agent, provided that no consent of
the Administrative Agent shall be required for an
assignment of all or any portion of a Loan to a Lender,
an affiliate of a Lender or an Approved Fund.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender, an
affiliate of a Lender or an Approved Fund or an
assignment of the entire remaining amount of the
assigning Lender's Commitments or Loans, the amount of
the Commitments or Loans of the assigning Lender
subject to each such assignment (determined as of the
date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent)
shall not be less than $1,000,000) unless each of the
Borrower and the Administrative Agent otherwise
consents, provided that (1) no such consent of the
Borrower shall be required if an Event of Default has
occurred and is continuing and (2) such amounts shall
be aggregated in respect of each Lender and its
affiliates or Approved Funds, if any;
64
(B) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and
Assumption, together with a processing and recordation
fee of $3,500; and
(C) the Assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent an administrative
questionnaire in which the Assignee designates one or
more credit contacts to whom all syndicate-level
information (which may contain material non-public
information about the Borrower and its Affiliates and
their related parties or their respective securities)
will be made available and who may receive such
information in accordance with the assignee's
compliance procedures and applicable laws, including
Federal and state securities law.
For the purposes of this Section 10.6, "Approved Fund" means any
Person (other than a natural person) that is engaged in making, purchasing,
holding or investing in bank loans and similar extensions of credit in the
ordinary course of its business and that is administered or managed by (a) a
Lender, (b) an affiliate of a Lender or (c) an entity or an affiliate of an
entity that administers or manages a Lender.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) below, from and after the effective date specified in
each Assignment and Assumption the Assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto but
shall continue to be entitled to the benefits of Sections 2.12, 2.13, 2.14
and 10.5(d)). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section
10.6 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments
of, and principal amount of the Loans owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive, and the Borrower, the Administrative Agent
and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender,
at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Assumption executed by an assigning Lender and an Assignee, the Assignee's
completed administrative questionnaire (unless the Assignee shall already
be a Lender hereunder), the processing and recordation fee referred to in
paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall
accept such Assignment and Assumption and record the information contained
therein in the Register. No assignment shall be effective for
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purposes of this Agreement unless it has been recorded in the Register as
provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a "Participant") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitments and the
Loans owing to it); provided that (A) such Lender's obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent, and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement. Any agreement pursuant to
which a Lender sells such a participation shall provide that such Lender shall
retain the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly affected thereby pursuant to the proviso to
the second sentence of Section 10.1 and (2) directly affects such Participant.
Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 10.7(b)
as though it were a Lender, provided that such Participant shall be subject to
Section 10.7(a) as though it were a Lender.
(ii) A Participant shall not be entitled to receive any greater
payment under Section 2.12 or 2.13 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent. Any Participant that is a
Non-U.S. Lender shall not be entitled to the benefits of Section 2.13
unless such Participant complies with Section 2.13(d).
(d) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or Assignee for such Lender as a party hereto.
(e) The Borrower, upon receipt of written notice from the relevant
Lender, agrees to issue Notes to any Lender requiring Notes to facilitate
transactions of the type described in paragraph (d) above.
(f) Notwithstanding the foregoing, any Conduit Lender may assign any
or all of the Loans it may have funded hereunder to its designating Lender
without the consent of the Borrower or the Administrative Agent and without
regard to the limitations set forth in Section 10.6(b). Each of the Borrower,
each Lender and the Administrative Agent hereby confirms that it will not
institute against a Conduit Lender or join any other Person in instituting
against a Conduit Lender any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceeding under any state bankruptcy or similar law, for one
year and one day after the payment in full of the latest maturing commercial
paper note issued by such Conduit Lender; provided, however, that each Lender
designating any Conduit Lender hereby agrees to indemnify, save and hold
harmless each other party hereto for any loss, cost, damage or expense arising
out of its inability to institute such a proceeding against such Conduit Lender
during such period of forbearance.
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10.7 Adjustments; Set-off.
(a) Except to the extent that this Agreement expressly provides for
payments to be allocated to a particular Lender, if any Lender (a "Benefitted
Lender") shall, at any time after the Loans and other amounts payable hereunder
shall immediately become due and payable pursuant to Section 8, receive any
payment of all or part of the Obligations owing to it, or receive any collateral
in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant
to events or proceedings of the nature referred to in Section 8(f), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of the Obligations owing to
such other Lender, such Benefitted Lender shall purchase for cash from the other
Lenders a participating interest in such portion of the Obligations owing to
each such other Lender, or shall provide such other Lenders with the benefits of
any such collateral, as shall be necessary to cause such Benefitted Lender to
share the excess payment or benefits of such collateral ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such Benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise), to set
off and appropriate and apply against such amount any and all deposits (general
or special, time or demand, provisional or final), in any currency, and any
other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of the Borrower, as the case may be. Each Lender agrees
promptly to notify the Borrower and the Administrative Agent after any such
setoff and application made by such Lender, provided that the failure to give
such notice shall not affect the validity of such setoff and application.
10.8 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.
10.9 Severability. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration. This Agreement and the other Loan Documents
represent the entire agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.
10.11 Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
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CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to the Borrower, as
the case may be at its address set forth in Section 10.2 or at such other
address of which the Administrative Agent shall have been notified pursuant
thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section any special, exemplary, punitive or consequential damages; provided
that none of the Borrower nor any of its Subsidiaries shall be liable for any
special exemplary punitive or consequential damages.
10.13 Acknowledgements. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
Administrative Agent and Lenders, on one hand, and the Borrower, on the other
hand, in connection herewith or therewith is solely that of debtor and creditor;
and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrower and the Lenders.
10.14 Releases of Guarantees and Liens.
(a) Notwithstanding anything to the contrary contained herein or in
any other Loan Document, the Administrative Agent is hereby irrevocably
authorized by each Lender (without requirement of notice to or consent of any
Lender except as expressly required by Section 10.1) to take any action
requested by the Borrower having the effect of releasing any Collateral or
guarantee obligations (i) to the extent necessary to permit consummation of any
transaction not prohibited by any
68
Loan Document or that has been consented to in accordance with Section 10.1 or
(ii) under the circumstances described in paragraph (b) below; provided that any
Collateral Disposed or transferred pursuant to a transaction permitted under
Section 7.5 shall automatically be released from the security interest granted
pursuant to the Loan Documents without the requirement of further action by any
Person.
(b) At such time as the Loans and the other obligations under the Loan
Documents (other than obligations under or in respect of Swap Agreements) and
contingent obligations not due and payable shall have been paid in full, the
Collateral shall be released from the Liens created by the Security Documents,
and the Security Documents and all obligations (other than those expressly
stated to survive such termination) of the Administrative Agent and each Loan
Party under the Security Documents shall terminate, all without delivery of any
instrument or performance of any act by any Person.
10.15 Confidentiality. Each of the Administrative Agent and each
Lender agrees to keep confidential all non-public information provided to it by
any Loan Party, the Administrative Agent or any Lender pursuant to or in
connection with this Agreement that is designated by the provider thereof as
confidential; provided that nothing herein shall prevent the Administrative
Agent or any Lender from disclosing any such information (a) to the
Administrative Agent, any other Lender or any affiliate thereof, (b) subject to
an agreement to comply with the provisions of this Section, to any actual or
prospective Transferee or any direct or indirect counterparty to any Swap
Agreement (or any professional advisor to such counterparty), (c) to its
employees, directors, agents, attorneys, accountants and other professional
advisors or those of any of its affiliates on a confidential basis, (d) upon the
request or demand of any Governmental Authority having jurisdiction over it, (e)
in response to any order of any court or other Governmental Authority or as may
otherwise be required pursuant to any Requirement of Law, (f) if requested or
required to do so in connection with any litigation or similar proceeding, (g)
that has been publicly disclosed (other than in violation of any confidentiality
obligation known to such Lender, including pursuant to this Section 10.15), (h)
on a no-name basis, to the National Association of Insurance Commissioners or
any similar organization or any nationally recognized rating agency that
requires access to information about a Lender's investment portfolio in
connection with ratings issued with respect to such Lender, or (i) in connection
with the exercise of any remedy hereunder or under any other Loan Document;
provided that in the cases of clauses (d), (e) or (f) the relevant Lender or
Administrative Agent agrees to inform the Borrower promptly thereof.
Each Lender acknowledges that information furnished to it pursuant to
this Agreement may include material non-public information concerning the
Borrower and its Affiliates and their related parties or their respective
securities, and confirms that it has developed compliance procedures regarding
the use of material non-public information and that it will handle such material
non-public information in accordance with those procedures and applicable law,
including Federal and state securities laws.
All information, including requests for waivers and amendments,
furnished by the Borrower or the Administrative Agent pursuant to, or in the
course of administering, this Agreement will be syndicate-level information,
which may contain material non-public information about the Borrower and its
Affiliates and their related parties or their respective securities.
Accordingly, each Lender represents to the Borrower and the Administrative Agent
that it has identified in its administrative questionnaire a credit contact who
may receive information that may contain material non-public information in
accordance with its compliance procedures and applicable law, including Federal
and state securities laws.
10.16 Waivers of Jury Trial. THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
CLEARWIRE CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Executive VP and CFO
---------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC., as
Administrative Agent and as a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Title: VP
---------------------------------
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇,
INCORPORATED, as Syndication Agent and
as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Managing Director
---------------------------------
JPMORGAN CHASE BANK, N.A., as
Documentation Agent and as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
70