EXHIBIT 99.3
LOAN AGREEMENT
AMONG GCI CABLE, INC., AS BORROWER;
TORONTO DOMINION (TEXAS), INC.,
CREDIT LYONNAIS NEW YORK BRANCH,
THE CHASE MANHATTAN BANK N.A.,
AND NATIONSBANK OF TEXAS, N.A.,
AS MANAGING AGENTS;
NATIONSBANK OF TEXAS, N.A.,
AS SYNDICATION AGENT;
CREDIT LYONNAIS NEW YORK BRANCH,
AS DOCUMENTATION AGENT;
BANQUE PARIBAS AND THE BANK OF NEW YORK, AS CO-AGENTS;
THE BANKS WHOSE NAMES ARE SET FORTH
ON THE SIGNATURE PAGES HEREOF; AND
TORONTO DOMINION (TEXAS), INC.,
AS ADMINISTRATIVE AGENT
FOR THE MANAGING AGENTS AND THE BANKS.
AS OF OCTOBER 31, 1996.
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TABLE OF CONTENTS
ARTICLE 1 Definitions........................................................................ 3
ARTICLE 2 The Loans.......................................................................... 19
Section 2.1 The Loans....................................................................... 19
Section 2.2 Manner of Borrowing and Disbursement............................................ 19
Section 2.3 Interest........................................................................ 22
Section 2.4 Fees and Additional Compensation................................................ 24
Section 2.5 Voluntary Prepayment/Voluntary Reduction of Commitment.......................... 25
Section 2.6 Scheduled Reduction of Commitment............................................... 25
Section 2.7 Mandatory Reduction of Commitment............................................... 26
Section 2.8 Notes; Loan Accounts............................................................ 27
Section 2.9 Manner of Payment............................................................... 27
Section 2.10 Reimbursement................................................................... 28
Section 2.11 Pro Rata Treatment.............................................................. 29
Section 2.12 Capital Adequacy................................................................ 29
Section 2.13 Bank Tax Forms.................................................................. 30
Section 2.14 Letters of Credit............................................................... 30
ARTICLE 3 Conditions Precedent............................................................... 34
Section 3.1 Conditions Precedent to Initial Advance......................................... 34
Section 3.2 Conditions Precedent to Each Advance............................................ 37
Section 3.3 Conditions Precedent to Issuance of Each Letter of Credit....................... 38
ARTICLE 4 Representations and Warranties..................................................... 38
Section 4.1 Representations and Warranties.................................................. 38
Section 4.2 Survival of Representations and Warranties etc.................................. 45
ARTICLE 5 General Covenants.................................................................. 45
Section 5.1 Preservation of Existence and Similar Matters................................... 45
Section 5.2 Business: Compliance with Applicable Law........................................ 45
Section 5.3 Maintenance of Properties....................................................... 46
Section 5.4 Accounting Methods and Financial Records........................................ 46
Section 5.5 Insurance....................................................................... 46
Section 5.6 Payment of Taxes and Claims..................................................... 47
Section 5.7 Visits and Inspections.......................................................... 47
Section 5.8 Payment of Indebtedness......................................................... 47
Section 5.9 Use of Proceeds................................................................. 47
Section 5.10 Management...................................................................... 47
Section 5.11 Real Estate..................................................................... 47
Section 5.12 Indemnity....................................................................... 48
Section 5.13 Payment of Wages................................................................ 48
Section 5.14 Interest Rate Hedging........................................................... 48
Section 5.15 ERISA........................................................................... 48
Section 5.16 Further Assurances.............................................................. 49
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ARTICLE 6 Information Covenants.............................................................. 49
Section 6.1 Quarterly Financial Statements and Information.................................. 49
Section 6.2 Annual Financial Statements and Information; Certificate of No Default.......... 49
Section 6.3 Performance Certificates........................................................ 50
Section 6.4 Monthly Reports................................................................. 50
Section 6.5 Copies of Other Reports......................................................... 50
Section 6.6 Notice of Litigation and Other Matters.......................................... 51
ARTICLE 7 Negative Covenants................................................................. 52
Section 7.1 Indebtedness of the Borrower.................................................... 52
Section 7.2 Investments..................................................................... 53
Section 7.3 Limitation on Liens............................................................. 53
Section 7.4 Amendment and Waiver............................................................ 53
Section 7.5 Liquidation; Disposition or Acquisition of Assets............................... 53
Section 7.6 Limitation on Guaranties........................................................ 54
Section 7.7 Restricted Payments and Purchases............................................... 54
Section 7.8 Leverage Ratio.................................................................. 55
Section 7.9 Interest Coverage Ratio......................................................... 55
Section 7.10 Annualized Operating Cash Flow to Pro Forma Debt Service Ratio.................. 55
Section 7.11 Fixed Charges Coverage Ratio.................................................... 56
Section 7.12 Affiliate Transactions.......................................................... 56
Section 7.13 Real Estate..................................................................... 56
Section 7.14 Transfer of Interests........................................................... 56
Section 7.15 ERISA Liabilities............................................................... 56
Section 7.16 Consolidated Tax Returns........................................................ 56
Section 7.17 Capital Expenditures............................................................ 57
ARTICLE 8 Default............................................................................ 57
Section 8.1 Events of Default............................................................... 57
Section 8.2 Remedies........................................................................ 60
ARTICLE 9 Change in Circumstances Affecting Eurodollar Advances.............................. 62
Section 9.1 Eurodollar Basis Determination Inadequate....................................... 62
Section 9.2 Illegality...................................................................... 62
Section 9.3 Increased Costs................................................................. 63
Section 9.4 Effect On Other Advances........................................................ 64
ARTICLE 10 The Administrative Agent and the Managing Agents................................... 64
Section 10.1 Appointment and Authorization................................................... 64
Section 10.2 Interest Holders................................................................ 65
Section 10.3 Consultation with Counsel....................................................... 65
Section 10.4 Documents....................................................................... 65
Section 10.5 Affiliates...................................................................... 65
Section 10.6 Responsibility of the Administrative Agent...................................... 65
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Section 10.7 Action by Administrative Agent.................................................. 66
Section 10.8 Notice of Default or Event of Default........................................... 66
Section 10.9 Responsibility Disclaimed....................................................... 67
Section 10.10 Indemnification................................................................. 67
Section 10.11 Credit Decision................................................................. 67
Section 10.12 Successor Administrative Agent.................................................. 67
Section 10.13 Administrative Agent May File Proofs of Claim................................... 68
ARTICLE 11 Miscellaneous...................................................................... 69
Section 11.1 Notices......................................................................... 69
Section 11.2 Expenses........................................................................ 71
Section 11.3 Waivers......................................................................... 71
Section 11.4 Determination by Administrative Agent Presumptively Correct and Binding......... 72
Section 11.5 Set-Off......................................................................... 72
Section 11.6 Assignment...................................................................... 73
Section 11.7 Accounting Principles........................................................... 75
Section 11.8 Counterparts.................................................................... 75
Section 11.9 Governing Law................................................................... 75
Section 11.10 Severability.................................................................... 75
Section 11.11 Interest and Charges............................................................ 75
Section 11.12 Headings........................................................................ 76
Section 11.13 Amendment and Waiver............................................................ 76
Section 11.14 Entire Agreement................................................................ 76
Section 11.15 Other Relationships............................................................. 76
Section 11.16 Loan Documents.................................................................. 76
Section 11.17 Confidential Treatment.......................................................... 76
Section 11.18 Reliance on and Survival of Various Provisions.................................. 77
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EXHIBITS
Exhibit A - Form of Assignment and Assumption Agreement
Exhibit B - Form of Assignment of Partnership Interests
Exhibit C - Form of Borrower's Pledge Agreement
Exhibit D - Form of Note
Exhibit E - Form of Parent's Pledge Agreement
Exhibit F-1 - Form of Request for Advance
Exhibit F-2 - Form of Request for Advance (Initial Advance)
Exhibit G - Form of Request for Issuance of Letter of Credit
Exhibit H - Form of Security Agreement
Exhibit I - Form of Subordination and Assignment of Management
Agreement
Exhibit J - Form of Subsidiary Guaranty
Exhibit K - Form of Subsidiary Security Agreement
Exhibit L - Form of Use of Proceeds Letter
Exhibit M - Form of Loan Certificate
Exhibit N-1 - Form of Opinion of Borrower's General Counsel
Exhibit N-2 - Form of Opinion of Prior Borrower's Counsel
Exhibit N-3 - Form of Opion of special APUC counsel
Exhibit N-4 - Form of Opinion of Borrower's FCC Counsel
Exhibit O - Form of Certificate of Financial Condition
Exhibit P - Form of Monthly Operating Report
Exhibit Q - Form of Subordination Agreement
SCHEDULES*
Schedule 1 - Letters of Credit as of the Agreement Date
Schedule 2 - List of Licenses
Schedule 3 - Liens of Record as of the Agreement Date
Schedule 4 - List of Pole Agreements
Schedule 5 - Description of Real Estate
Schedule 6 - Exceptions to Necessary Authorizations
Schedule 7 - List of Subsidiaries and Ownership Interests Therein
Schedule 8 - Overbuilding; Competing Franchises
Schedule 9 - Litigation
Schedule 10 - Environmental Matters
Schedule 11 - Agreements with Affiliates
Schedule 12 - Indebtedness
Schedule 13 - Notice Addresses
* Not included in document submitted as exhibit to the Form 8-K Current
Report for General Communication, Inc. for event as of October 31, 1996.
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LOAN AGREEMENT
AMONG GCI CABLE, INC., AS BORROWER;
TORONTO DOMINION (TEXAS), INC., CREDIT LYONNAIS NEW YORK BRANCH, THE CHASE
MANHATTAN BANK N.A., AND NATIONSBANK OF TEXAS, N.A., AS
MANAGING AGENTS;
NATIONSBANK OF TEXAS, N.A.,
AS SYNDICATION AGENT;
CREDIT LYONNAIS NEW YORK BRANCH,
AS DOCUMENTATION AGENT;
BANQUE PARIBAS AND THE BANK OF NEW YORK, AS CO-AGENTS;
THE BANKS WHOSE NAMES ARE SET FORTH ON THE
SIGNATURE PAGES HEREOF; AND TORONTO DOMINION (TEXAS), INC.,
AS ADMINISTRATIVE AGENT
FOR THE MANAGING AGENTS AND THE BANKS.
RECITALS
WHEREAS, Prime Cable of Alaska, L.P., a Delaware limited partnership
("Prior Borrower"), The Toronto-Dominion Bank Trust Company (the "Prior
Administrative Agent"), and the financial institutions named as "Banks" therein
are party to a certain Loan Agreement dated as of June 30, 1989 (as amended, the
"Prior Loan Agreement"); and
WHEREAS, the Prior Borrower, the Administrative Agent, the Managing
Agents and the Banks amended and restated the Prior Loan Agreement pursuant to
the Amended and Restated Loan Agreement dated as of March 7, 1996 ("First
Amended Loan Agreement"); and
WHEREAS, the Borrower, pursuant to the GCI Acquisition (defined below)
and simultaneously with the effectiveness of this Agreement, is acquiring a
ninety-nine percent (99%) general partnership interest in the Prior Borrower,
and GCI Cable Holdings, Inc., a wholly-owned subsidiary of the Borrower, is
acquiring a one percent (1%) limited partnership interest in the Prior Borrower,
as a result of which acquisitions the Borrower will acquire the Prime Cable
System (as defined below); and
WHEREAS, the Borrower, pursuant to the Rock and Cooke Acquisitions (as
defined below) on or shortly after the Agreement Date, is acquiring the Alaska
Cablevision System (as defined below) and the Alaskan Cable Network (as defined
below); and
WHEREAS, pursuant to the foregoing transactions, the Borrower, the
Administrative Agent, the Managing Agents and the Banks have agreed to refinance
the Loans outstanding under the First Amended Loan Agreement in order to, among
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other things, replace the Prior Borrower with the Borrower as the "Borrower"
hereunder, increase the principal amount of the Commitment, and finance the Rock
and Cooke Acquisitions;
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by each of the parties hereto, the parties hereby agree as
follows, as of the 31st day of October, 1996;
ARTICLE 1
Definitions
For the purposes of this Agreement:
"Acquisition" shall mean (whether by purchase, exchange, issuance of
stock or other equity or debt securities, merger, reorganization or any other
method) (i) any acquisition by the Borrower or its Subsidiaries (unless
otherwise indicated) of any other Person, the accounts of which Person shall
then become consolidated with the accounts of the Borrower in accordance with
GAAP, or (ii) any acquisition by the Borrower of all or any substantial part of
the assets of any other Person, or of assets in a material amount from any other
Person.
"Administrative Agent" shall mean Toronto Dominion (Texas), Inc., a
Delaware corporation, in its capacity as Administrative Agent for the Managing
Agents and the Banks, or any successor Administrative Agent named pursuant to
Section 10.12 hereof.
"Administrative Agent's Office" shall mean the office of the
Administrative Agent located at Toronto Dominion (Texas), Inc., 909 Fannin,
Suite 1700, Houston, Texas 77010, or such other office as may be designated
pursuant to the provisions of Section 11.1 of this Agreement.
"Advance" or "Advances" shall mean amounts advanced by the Banks to the
Borrower pursuant to Article 2 hereof on the occasion of any borrowing.
"Affiliate" shall mean any Person directly or indirectly controlling,
controlled by, or under common control with, the Borrower. For purposes of this
definition, "control" when used with respect to any Person includes, without
limitation, the direct or indirect beneficial ownership of more than 10 percent
(10%) of the voting securities or voting equity or partnership interests of such
Person, or the power to direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.
"Agreement" shall mean this Agreement.
"Agreement Date" shall mean October 31, 1996.
"Alaska Cablevision System" shall mean the cable television systems
which on or shortly after the Agreement Date shall be purchased by the Borrower
pursuant to
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the Rock and Cooke Acquisitions and which shall be owned, operated and
maintained by the Borrower or its Subsidiaries.
"Alaskan Cable Network System" shall mean the cable television systems
which on or shortly after the Agreement Date shall be purchased by the Borrower
pursuant to the Rock and Cooke Acquisitions and which shall be owned, operated
and maintained by the Borrower or its Subsidiaries.
"Annual Excess Cash Flow" shall mean, for any calendar year of the
Borrower based on the audited financial statements required to be provided
pursuant to Section 6.2 hereof, the Operating Cash Flow of the Borrower for such
calendar year minus each of the following for such calendar year: (i) cash
interest expense, (ii) the net permanent reduction of the outstanding principal
amount of the Loans, (iii) bank fees, (iv) cash income tax payments, (v) Capital
Expenditures, (vi) management fees, expenses, and other amounts paid in cash
which were deferred in a prior period of the Borrower under the Management
Agreement, (vii) payments made in respect of Capitalized Lease Obligations, and
(viii) any Investments made as permitted hereunder.
"Annualized Operating Cash Flow" shall mean an amount equal to the
Operating Cash Flow of the Borrower for a specified calendar quarter, multiplied
by four (4).
"Applicable Law" shall mean, in respect of any Person, all provisions
of constitutions, statutes, rules, regulations, and orders of governmental
bodies or regulatory agencies applicable to such Person, including, without
limiting the foregoing, the Licenses, the Communications Act of 1934, as
amended, Environmental Laws, and Title 17 of the United States Code, and all
orders and decrees of all courts and arbitrators in proceedings or actions to
which the Person in question is a party or by which it is bound.
"Applicable Margin" shall mean the interest rate margin applicable to
Advances hereunder as determined in accordance with Section 2.3(f) hereof.
"Assets" shall mean the assets of the Borrower.
"Assignment and Assumption Agreement" shall mean that certain form of
Assignment and Assumption Agreement, in substantially the form of Exhibit A
attached hereto, pursuant to which each Bank may, as further provided in Section
11.6 hereof, sell a portion of its Commitment and Loans hereunder.
"Assignment of Partnership Interests" shall mean the Assignment of
Partnership Interests of even date, substantially in the form of Exhibit B
attached hereto.
"Authorized Signatory" shall mean such senior personnel of the Borrower
as may be duly authorized and designated in writing by the Borrower to execute
documents, agreements and instruments on behalf of the Borrower.
"Banks" shall mean each of the Banks whose names are set forth as
"Banks" on the signature pages hereof, and each direct or indirect assignee of
any of the Banks
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which hereafter becomes a party to this Loan Agreement pursuant to and in
accordance with Section 11.6 hereof; and "Bank" shall mean any one of the
foregoing Banks.
"Base Rate" shall mean, as of any date, a simple interest rate per
annum equal to the greater of (x) the Prime Rate, or (y) the sum of (A) the
Federal Funds Rate plus (B) five-eighths of one percent (5/8%). The Base Rate
shall be adjusted automatically as of the opening of business on the effective
date of each change in the Prime Rate or the Federal Funds Rate, as the case may
be, to account for such change.
"Base Rate Advance" shall mean an Advance which the Borrower requests
to be made as a Base Rate Advance or is converted to a Base Rate Advance, in
accordance with the provisions of Section 2.2 hereof, bearing interest at a per
annum rate equal to the sum of the Base Rate plus the Applicable Margin, and
which shall be in a principal amount of at least $500,000 and in an integral
multiple of $100,000.
"Borrower" shall mean GCI Cable, Inc., an Alaska corporation which is a
wholly-owned Subsidiary of the Parent Company.
"Borrower's Pledge Agreement" shall mean that certain Borrower's Pledge
Agreement of even date, substantially in the form of Exhibit C attached hereto.
"Business Day" shall mean a day on which banks and foreign exchange
markets are open for the transaction of business required for this Agreement in
London, England, Houston, Texas, and New York, New York, as relevant to the
determination to be made or action to be taken.
"Cable Business" shall mean (i) the business of providing video and
audio programming and data delivered via broadband coaxial and fiber optic
cables to residential and commercial subscribers, and (ii) other activities that
use cable and non-cable technologies to provide entertainment, voice and data
transmission, educational and other services that are complementary to the
business of the Systems.
"Capital Expenditures" shall mean expenditures for the purchase of
assets of long-term use which are capitalized in accordance with GAAP.
"Capitalized Lease Obligation" shall mean that portion of any
obligation of a Person as lessee under a lease which at the time would be
required to be capitalized on the balance sheet of such lessee in accordance
with GAAP.
"Change in Control" shall mean the occurrence of any one of the
following: (i) a change in the ownership, in any transaction or series of
transactions, involving a Person who is not a stockholder of Prime II
Management, Inc., on the Agreement Date, of an aggregate of 20% or more of the
outstanding common stock of Prime II Management, Inc.; (ii) Prime II Management,
Inc. shall no longer be the sole general partner of Prime II Management, L.P.;
or (iii) the Borrower and its Subsidiaries shall no longer be Subsidiaries of
the Parent Company.
"Co-Agents" shall mean Banque Paribas, The Bank of New York, and any
other Person that becomes a Co-Agent hereunder.
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"Collateral" shall mean the Assets described as "Collateral" in the
Security Agreement and the Subsidiary Security Agreement, the partnership
interest and other assets pledged pursuant to the Assignment of Partnership
Interests, the stock and other assets pledged pursuant to the Borrower's Pledge
Agreement and the Parent's Pledge Agreement, or any real property or other
property covered by any Mortgage, or any other property of any kind constituting
collateral for the Obligations pursuant to any of the Loan Documents.
"Commitment" shall mean, the several obligations of the Banks to
advance the sum of up to $205,000,000 to the Borrower in accordance with their
respective Commitment Ratios, as such obligation is reduced from time to time
pursuant to the terms hereof.
"Commitment Ratios" shall mean the percentages in which the Banks are
severally bound to satisfy the Commitment to make Advances to the Borrower, as
set forth below:
Bank Commitment Ratio Commitment
---- ---------------- ----------
Toronto Dominion 15.243902% $ 31,250,000.00
(Texas), Inc.
NationsBank of Texas, N.A. 15.243902% $ 31,250,000.00
Credit Lyonnais 15.243902% $ 31,250,000.00
New York Branch
The Chase Manhattan Bank N.A. 15.243902% $ 31,250,000.00
The Bank of New York 12.195121% $ 25,000,000.00
Banque Paribas 12.195121% $ 25,000,000.00
PNC Bank, National 7.317073% $ 15,000,000.00
Association
The First National Bank of 7.317073% $ 15,000,000.00
Maryland
TOTAL 100% $205,000,000.00
"Debt Service" shall mean, for any period, the sum for the Borrower of
(a) Total Interest Expense, (b) Required Repayments, and (c) fees due under
Section 2.4(b), (c) and (d) hereof.
"Default" shall mean any of the events specified in Section 8.1 hereof,
regardless of whether there shall have occurred any passage of time or giving of
notice or both that would be necessary in order to constitute such event an
Event of Default.
"Default Rate" shall mean a simple per annum interest rate equal to,
(a) with respect to outstanding principal, the sum of (i) the applicable
Interest Rate Basis, plus (ii) the Applicable Margin, plus (iii) two percent
(2%), and (b) with respect to all
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other Obligations, the sum of (i) the Base Rate, plus (ii) the Applicable
Margin, plus (iii) two percent (2%).
"Documentation Agent" shall mean Credit Lyonnais New York Branch, and
any Person that becomes a Documentation Agent hereunder.
"Dollars" or "$" shall mean the basic unit of the lawful currency of
the United States of America.
"Environmental Laws" shall mean any and all applicable federal, state,
local or municipal laws, rules, orders, regulations, statutes, ordinances,
codes, permit conditions, decrees or requirements of any governmental authority
regulating, relating to or imposing liability or standards of conduct concerning
environmental protection matters, including without limitation, those relating
to releases, discharges, emissions or disposal to air, water, land or ground
water, to the withdrawal or use of ground water, to the use, handling or
disposal of polychlorinated biphenyls, asbestos or urea formaldehyde, to the
treatment, storage, disposal or management of hazardous substances (including,
without limitation, petroleum, crude oil or any fraction thereof, or other
hydrocarbons), pollutants or contaminants, to exposure to toxic, hazardous or
other controlled, prohibited, or regulated substances, including, without
limitation, any provisions under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. section 9601 et
seq.) or the Resource Conservation and Recovery Act of 1976, as amended (42
U.S.C. section 6901 et seq.).
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as in effect on the Agreement Date and as such Act may be amended thereafter
from time to time.
"ERISA Affiliate" shall mean any Person which is an "affiliate" of the
Borrower within the meaning of Section 414 of the Internal Revenue Code and
which together with the Borrower is treated as a single employer for purposes of
such Section 414.
"Eurodollar Advance" shall mean an Advance which the Borrower requests
to be made as a Eurodollar Advance or which is converted to a Eurodollar
Advance, in accordance with the provisions of Section 2.2 hereof, which bears
interest at a per annum rate equal to the Eurodollar Basis plus the Applicable
Margin, and which shall be in a principal amount of at least $1,000,000 and in
an integral multiple of $250,000.
"Eurodollar Basis" shall mean a simple interest rate per annum (rounded
upward to the nearest one-sixteenth (1/16th) of one percent) equal to the
quotient of (i) the Eurodollar Rate divided by (ii) one minus the Eurodollar
Reserve Percentage, stated as a decimal. The Eurodollar Basis shall apply to
Interest Periods of one (1), two (2), three (3) and six (6) months, and, subject
to the last sentence of this definition, of nine (9) or twelve (12) months. The
Eurodollar Basis shall be subject to Article 9 hereof and, once determined,
shall remain unchanged during the applicable Interest Period, except for changes
to reflect adjustments in the Eurodollar Reserve Percentage. The Borrower may
not elect an Interest Period for a Eurodollar Advance in excess of six (6)
months unless the Administrative Agent has notified the Borrower (i) that each
of the Banks has available to it funds for such Bank's share of
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the proposed Advance which are not required for other purposes, (ii) that such
funds are available to each Bank at a rate (exclusive of reserves and other
adjustments) at or below the Eurodollar Rate for such proposed Advance and
Interest Period, and (iii) that each Bank has, in its sole discretion, agreed to
fund such Advance.
"Eurodollar Rate" shall mean, for any Interest Period, the interest
rate per annum (rounded upward to the nearest one sixteenth (1/16th) of one
percent) determined by the Administrative Agent to be the average of the rates
at which deposits in United States dollars for such Interest Period are offered
to the Administrative Agent in the Eurodollar interbank borrowing market at
approximately 11:00 a.m. (New York time), two (2) Business Days before the first
day of such Interest Period, in an amount approximately equal to the principal
amount of, and for a length of time approximately equal to the Interest Period
for, the Eurodollar Advance sought by the Borrower.
"Eurodollar Reserve Percentage" shall mean the percentage which is in
effect from time to time under Regulation D of the Board of Governors of the
Federal Reserve System, as such regulation may be amended from time to time, as
the maximum reserve requirement applicable with respect to Eurocurrency
Liabilities (as that term is defined in Regulation D), whether or not any Bank
has any such Eurocurrency Liabilities subject to such reserve requirement at
that time. The Eurodollar Basis for the applicable Interest Period shall be
adjusted automatically for any change in the Eurodollar Reserve Percentage.
"Event of Default" shall mean any of the events specified in Section
8.1 hereof to be an Event of Default.
"FCC" shall mean the Federal Communications Commission or any successor
thereto.
"Federal Funds Rate" shall mean, as of any date, the weighted average
of the rates on overnight federal funds transactions with the members of the
Federal Reserve System arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by the Administrative Agent.
"Fee Letters" shall mean those certain letter agreements dated as of
the Agreement Date between the Borrower and each of the Administrative Agent,
the Managing Agents and the Banks, regarding the payment of certain fees to the
Administrative Agent, the Managing Agents and the Banks.
"First Amended Loan Agreement" shall have the meaning assigned to it in
the Recitals of this Agreement.
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"Fixed Charges" shall mean, for any calendar quarter of the Borrower,
the sum of (a) Debt Service, (b) Capital Expenditures, and (c) cash taxes paid.
"GAAP" shall mean, as in effect from time to time, generally accepted
accounting principles used in the United States, consistently applied.
"GCI Acquisition" shall mean the transaction (as well as all
contemporaneous transactions associated therewith) which shall occur
simultaneously with the effectiveness of this Agreement, pursuant to the terms
of the Securities Purchase and Sale Agreement among General Communication, Inc.,
the Manager, and the direct and indirect equity owners and profit participation
right holders of Prime Cable of Alaska, L.P. dated as of May 2, 1996, as amended
by Amendment No. 1 to Securities Purchase and Sale Agreement of even date, and
pursuant to which, among other things, (a) the Borrower shall acquire a
ninety-nine percent general partnership interest in the Prior Borrower, and (b)
GCI Cable Holdings, Inc., a wholly-owned subsidiary of the Borrower, shall
acquire a one percent (1%) limited partner interest in the Prior Borrower, as a
result of which acquisitions, (x) the Prior Borrower will become a wholly-owned
subsidiary of the Borrower, and (y) the Borrower shall acquire the Prime Cable
System and all assets and business related thereto.
"Guaranty" or "Guaranteed," as applied to an obligation, shall mean and
include (a) a guaranty, direct or indirect, in any manner, of any part or all of
such obligation and (b) an agreement, direct or indirect, contingent or
otherwise, the practical effect of which is to assure in any way the payment or
performance (or payment of damages in the event of non-performance) of any part
or all of such obligation, including, without limiting the foregoing, any
reimbursement obligation as to outstanding letters of credit.
"Hazardous Materials" shall mean any and all hazardous or toxic
substances, materials or wastes as defined or listed in Environmental Laws.
"Indebtedness" shall mean, with respect to any Person, (a) all items,
except items of partners' equity or of surplus or of general contingency or
deferred tax reserves, which in accordance with GAAP would be included in
determining total liabilities as shown on the liability side of a balance sheet
of such Person, (b) all obligations secured by any Lien to which any property or
asset owned by such Person is subject, whether or not the obligation secured
thereby shall have been assumed, (c) to the extent not otherwise included, any
Guaranty and all Capitalized Lease Obligations of such Person and all
obligations of such Person with respect to leases constituting part of a sale
and lease-back arrangement, (d) all reimbursement obligations with respect to
the undrawn portions of outstanding letters of credit, and (e) obligations under
Interest Hedge Agreements.
"Indebtedness for Money Borrowed" shall mean money borrowed and
Indebtedness represented by notes payable and drafts accepted representing
extensions of credit, all obligations evidenced by bonds, debentures, notes or
other similar instruments, all Indebtedness upon which interest charges are
customarily paid, and all Indebtedness (excluding Capitalized Lease Obligations
and excluding (i) the items referred to in (d) and (e) of the definition of the
term "Indebtedness" above, and (ii) accounts payable, subscriber deposits,
accrued expenses, customer advanced payments
General Communication, Inc. - Form 8-K
Page 166
and other current liabilities (other than for money borrowed) incurred in the
ordinary course of business) issued or assumed as full or partial payment for
property or services, whether or not any such notes, drafts, obligations or
Indebtedness represent Indebtedness for money borrowed. Where obligations are
evidenced by bonds, debentures, notes or other similar instruments whose face
amount exceeds the amount received by the Borrower with respect thereto, only
the amount received plus debt discount amortized as of the calculation date is
to be taken into account as Indebtedness for Money Borrowed. Interest which is
accrued but not paid on the original due date or before the expiration of any
applicable grace period for such payment shall be deemed Indebtedness for Money
Borrowed.
"Indemnified Parties" shall mean those Persons eligible to be
indemnified by the Borrower pursuant to this Agreement, and shall include the
Administrative Agent, the Managing Agents, T-D Bank, and each of the Banks and
each of their respective employees, representatives, officers, agents,
directors, and affiliates.
"Interest Hedge Agreements" shall mean any interest swap agreement,
interest rate cap agreements, interest rate collar agreements, or any similar
arrangements designed to hedge the risk of variable interest rate volatility,
arising at any time between the Borrower, on the one hand, and the
Administrative Agent, one or more of the Managing Agents, one or more of the
Banks, or any other Person, on the other hand, as such agreement or arrangements
may be modified, supplemented or amended, and as in effect from time to time.
"Interest Period" shall mean, (a) in connection with any Base Rate
Advance, the period beginning on the date such Advance is made and ending on the
last day of the calendar quarter in which such Advance is made, provided,
however, that if a Base Rate Advance is made on the last day of any calendar
quarter, it shall have an Interest Period ending on the last day of the
following calendar quarter; and (b) in connection with any Eurodollar Advance,
the term of such Advance selected by the Borrower or otherwise determined in
accordance with this Agreement. Notwithstanding the foregoing, however, (i) any
applicable Interest Period which would otherwise end on a day which is not a
Business Day shall be extended to the succeeding Business Day unless, with
respect to Eurodollar Advances only, such Business Day falls in another calendar
month, in which case such Interest Period shall end on the preceding Business
Day, (ii) any applicable Interest Period, with respect to Eurodollar Advances
only, which begins on a day for which there is no numerically corresponding day
in the calendar month during which such Interest Period is to end shall (subject
to clause (i) above) end on the last day of such calendar month, and (iii) no
Interest Period shall extend beyond the applicable Maturity Date or such earlier
date as would interfere with the Borrower's repayment obligations under Sections
2.6 or 2.7 hereof. Interest shall be due and payable with respect to any Advance
as provided in Section 2.3 hereof.
"Interest Rate Basis" shall mean the Base Rate or the Eurodollar Basis,
as appropriate.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended.
General Communication, Inc. - Form 8-K
Page 167
"Investment" shall mean any acquisition of assets from, the securities
or Indebtedness of, or making any capital contribution to, or other investment
in, any other Person by the Borrower, or any Guaranty, commitment or obligation
incurred by the Borrower in connection with the acquisition of the securities or
Indebtedness of such Person or any affiliate of such Person.
"Letter of Credit Commitment" shall mean the several obligations of the
Banks to fund Advances resulting from draws under the Letters of Credit pursuant
to the terms hereof, such Advances to be funded by the Banks in accordance with
their respective Commitment Ratios.
"Letters of Credit" shall mean any and all letters of credit, in form
and substance reasonably acceptable to T-D Bank and the Administrative Agent,
and in an aggregate face amount not to exceed $1,000,000, issued by T-D Bank
pursuant to Sections 2.1(c) and 2.14 hereof, and for the account of the
Borrower. Each Letter of Credit shall have a face amount not less than $50,000.
As of the Agreement Date, the outstanding Letters of Credit are listed on
Schedule 1 attached hereto.
"Leverage Ratio" shall mean, as of the end of any calendar quarter, the
ratio of Total Debt to Annualized Operating Cash Flow.
"Licenses" shall mean any rights including, without limitation,
certificates of public convenience and necessity issued by the Alaska Public
Utilities Commission, whether based upon any agreement, statute, order,
ordinance or otherwise, granted by any governmental authority to the Borrower or
any of its Subsidiaries, to own and operate cable television systems or SMATV
Systems, described as of the Agreement Date on Schedule 2 attached hereto, and
any other such rights subsequently obtained by the Borrower or any of its
Subsidiaries, together with any amendment, modification or replacement with
respect thereto.
"Lien" shall mean, with respect to any property, any mortgage, lien,
pledge, assignment, charge, security interest, title retention agreement, levy,
execution, seizure, attachment, garnishment or other encumbrance of any kind
(including an agreement not to permit an asset to be subject to a lien or an
encumbrance) in respect of such property, whether or not choate, vested or
perfected.
"Loan Documents" shall mean, without limitation, this Agreement, the
Notes, any Mortgages, Borrower's Pledge Agreement, Parent's Pledge Agreement,
Security Agreement, Subsidiary Security Agreement, Subsidiary Guaranty,
Assignment of Partnership Interest, the Subordination and Assignment of
Management Agreement, the Fee Letters, any Letters of Credit, any Interest Hedge
Agreement between the Borrower, on the one hand, and the Administrative Agent,
the Managing Agents, the Banks, or any of them, or any affiliate of any of them,
on the other hand, all Requests for Advance, the Use of Proceeds Letter, all
Requests for Issuance of Letter of Credit, and any other document or agreement
or certificate executed in connection herewith or contemplated hereby.
"Loans" shall mean, collectively, the amount from time to time advanced
by the Banks to the Borrower under the Commitment, not to exceed the amount of
the Commitment, and evidenced by the Notes.
General Communication, Inc. - Form 8-K
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"Majority Banks" shall mean, at any time, Banks the total of whose
Commitment Ratios equals or exceeds fifty-one percent (51%) of the total amount
of all Commitment Ratios.
"Management Agreement" shall mean that certain Management Agreement
between the Borrower and Prime II Management, L.P. of even date herewith, and as
subsequently amended in accordance with the terms of this Agreement, wherein the
Manager agrees to provide management services to the Borrower and its
Subsidiaries regarding all aspects of daily operation of the Systems, including
programming, development of advertising, marketing and sales programs,
supervision of construction, preparation of financial reports, budgets and
reports to governmental and regulatory agencies, and liaison with federal, state
and local governmental officials. For purposes hereof, "Management Agreement"
shall also include any similar agreement between the Borrower and any successor
to Prime II Management, L.P. permitted hereunder, which agreement shall be in
form and substance acceptable to the Majority Banks.
"Manager" shall mean Prime II Management, L.P., a Delaware limited
partnership, or any Person having Prime II Management, L.P. as the owner of a
majority of its equity ownership interests and which has acknowledged and agreed
to be bound by the terms and conditions of the Subordination and Assignment of
Management Agreement (and executed any UCC financing statements required by the
Administrative Agent in connection therewith), and assumed the obligations of
Prime II Management, L.P. under the Management Agreement.
"Managing Agents" shall mean Toronto Dominion (Texas), Inc.,
NationsBank of Texas, N.A., Credit Lyonnais New York Branch, The Chase Manhattan
Bank N.A., and any other Person that becomes a Managing Agent hereunder.
"Materially Adverse Effect" shall mean any materially adverse effect
upon the business operations, assets, liabilities, financial condition, results
of operations or business prospects of the Borrower and its Subsidiaries, taken
as a whole, or upon the ability of the Borrower and its Subsidiaries, to
construct, operate, and maintain the Systems or to repay the Loans, resulting
from any act, omission, situation, status, event or undertaking, either singly
or taken together; provided, however, that in no event shall Materially Adverse
Effect include the effects of any future general economic conditions or
technological changes which affect the country as a whole or the cable
television industry as a whole, including, without limitation, conditions or
changes which affect the prevailing interest rates available to entities or
businesses involved in the cable television industry or which affect the
prevailing resale valuations or the method of determining such valuations of
businesses involved in the cable television industry.
"Maturity Date" shall mean September 30, 2005 or such earlier date as
payment of the Loans shall be due (whether by acceleration or otherwise).
"Mortgage" shall mean any mortgage, deed to secure debt, deed of trust,
or other instrument encumbering or transferring title (in fee simple or
leasehold) to real property, in form and substance satisfactory to the
Administrative Agent, by which the Borrower or any of its Subsidiaries grants a
mortgage to the Administrative
General Communication, Inc. - Form 8-K
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Agent, as agent for the Managing Agents and the Banks, in real property owned or
leased by the Borrower or such Subsidiary to secure repayment of the
Obligations.
"Multiemployer Plan" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"Necessary Authorizations" shall mean all authorizations, consents,
permits, exemptions, approvals and licenses from, and all filings and
registrations with, and all required reports to, any governmental or other
regulatory authority, including without limiting the foregoing the Licenses and
approvals, licenses, filings and registrations under the Communications Act of
1934, as amended, necessary in order to enable the Borrower and its Subsidiaries
to construct, maintain and operate the Systems.
"Net Income" shall mean, as applied to any Person for any period, the
aggregate amount of net income of such Person, after taxes, for such period as
determined in accordance with GAAP.
"Net Proceeds" shall mean, with respect to any sale, lease, transfer or
other disposition of assets by the Borrower or any Subsidiary, or any issuance
by the Borrower or any Subsidiary of any capital stock or other debt or equity
securities permitted hereunder (in any event, a "Sales Transaction") (other than
(a) the sale of the obsolete equipment and inventory in the ordinary course of
business, (b) the sale of assets (other than as referred to in (a) above) not in
excess of $4,000,000 in the aggregate during the term of this Agreement, (c) the
incurrence of Indebtedness for Money Borrowed permitted under Section 7.1(c)
hereof, (d) the subordinated debt or equity securities issued in order to
prevent the occurrence of a Default under Section 8.1(d) hereof as permitted
thereunder, (e) loans, securities issuances or other investments permitted under
Section 7.2(a), and (f) up to $13,000,000 in additional equity contributed by
the Parent Company to the Borrower pursuant to Section 7.5(d), within six (6)
months from the Agreement Date, as a direct result of the issuance of additional
equity securities by the Parent Company to MCI Communications, Inc.), the
aggregate sales price in cash received for such assets or securities (including
without limitation any payments in respect of noncompetition covenants), net of
(i) taxes payable with respect to any such Sales Transaction, (ii) contingencies
with respect to any such Sales Transaction, appropriately reserved for by the
Borrower under GAAP, and (iii) reasonable and customary transaction costs
properly attributable to such Sales Transaction and payable by the Borrower or
any Subsidiary in connection with such Sales Transaction, including, without
limitation, sales commissions and underwriting discounts.
"Notes" shall mean those certain revolving promissory notes in the
aggregate original principal amount of $205,000,000, one issued by the Borrower
to each of the Banks hereunder, each one substantially in the form of Exhibit D
attached hereto, and any extension, modifications, renewals or replacements of
or amendments to any of the foregoing.
"Obligations" shall mean (i) all payment and performance obligations of
the Borrower, its Subsidiaries, and any other obligors to the Administrative
Agent, the Managing Agents, the Banks, or any of them under this Agreement and
the other Loan Documents (including, without limitation, obligations of the
Borrower under Interest Hedge Agreements with the Administrative Agent, the
Managing Agents, the
General Communication, Inc. - Form 8-K
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Banks, or any of them or any affiliate of any of them), as they may be amended
from time to time, or as a result of making the Loans, however arising or
evidenced, whether now existing or hereafter arising, due or to become due or
absolute or contingent, and (ii) the obligation of the Borrower or any
Subsidiary to pay an amount equal to the amount of any and all damage which the
Administrative Agent and the Banks may suffer by reason of a breach of the
Borrower, any Subsidiary, or any other obligor of any obligation, covenant or
undertaking with respect to this Agreement or any other Loan Document.
"Operating Cash Flow" shall mean, as applied to any Person in respect
of any period, the sum of (a) the remainder of (i) the Net Income of such Person
for such period minus (ii) extraordinary income (including extraordinary gains
resulting from sales of assets) of such Person for such period and any taxes
associated therewith, plus (b) interest expense, depreciation, amortization,
bank fees, deferred management fees, expenses, and other amounts under the
Management Agreement, income tax expense, extraordinary losses (including losses
resulting from such sale of assets, net of any tax effect), and all other
non-cash expenses deducted in determining such Net Income.
"Parent Company" shall mean General Communication, Inc., an Alaska
corporation, which owns all of the issued and outstanding capital stock of the
Borrower.
"Parent's Pledge Agreement" shall mean that certain Parent's Pledge
Agreement of even date, substantially in the form of Exhibit E attached hereto.
"Payment Date" shall mean the last day of the Interest Period for any
Advance.
"Permitted Liens" shall mean, as applied to any Person:
(a) any Lien in favor of the Administrative Agent on behalf of
the Managing Agents and the Banks to secure the Obligations (including liens to
secure obligations of the Borrower and its Subsidiaries to the Administrative
Agent, the Managing Agents, the Banks, or any of them or an affiliate of any of
them pursuant to Interest Hedge Obligations);
(b) (i) Liens on real estate for real estate taxes not yet
delinquent and (ii) Liens for taxes, assessments, governmental charges or levies
or claims the non-payment of which is being contested in good faith by
appropriate proceedings and for which adequate reserves shall have been set
aside on such Person's books, but only so long as no foreclosure, distraint,
sale or similar proceedings have been commenced with respect thereto and remain
unstayed for a period of thirty (30) days after their commencement;
(c) Liens of carriers, warehousemen, mechanics, laborers and
materialmen incurred in the ordinary course of business for sums not yet due or
being contested in good faith, if such reserve or appropriate provision, if any,
as shall be required by GAAP shall have been made therefor;
General Communication, Inc. - Form 8-K
Page 171
(d) Liens incurred in the ordinary course of business in
connection with worker's compensation and unemployment insurance;
(e) Restrictions on the transfer of assets imposed by any
License, by the Communications Act of 1934, as amended, and any regulations
thereunder, or by any state or local statute, regulation or ordinance applicable
to such Person;
(f) Liens pursuant to the Pole Agreements on cables and other
property affixed to transmission poles or contained in underground conduits;
(g) Easements, rights-of-way, restrictions and other similar
encumbrances on the use of real property which do not interfere with the
ordinary conduct of the business of such Person, or Liens incidental to the
conduct of the business of such Person or to the ownership of its properties
which were not incurred in connection with Indebtedness or other extensions of
credit and which do not in the aggregate materially detract from the value of
such properties or materially impair their use in the operation of the business
of such Person;
(h) Purchase money security interests arising and perfected by
operation of law only for a period not to exceed ten (10) days from the
inception thereof, and limited to Liens on assets so purchased;
(i) Liens of record as of the Agreement Date listed on Schedule
3 attached hereto, and other Liens securing Indebtedness in an amount not to
exceed in the aggregate at any time, together with the Indebtedness secured by
Liens listed on Schedule 3 attached hereto (other than Indebtedness arising
under leases with respect to which a notice filing appears on Schedule 3),
$3,000,000;
(j) Liens in favor of landlords to secure unpaid rental payments
under leases;
(k) Liens of lessors with respect to Capitalized Lease
Obligations permitted under this Agreement.
"Person" shall mean an individual, corporation, partnership, limited
liability company, trust or unincorporated organization, or a government or any
agency or political subdivision thereof.
"Plan" shall mean an employee benefit plan within the meaning of
Section 3(3) of ERISA or any other plan maintained for employees of any Person
or any ERISA Affiliate of such Person.
"Pole Agreements" shall mean the agreements between the Borrower or any
of its Subsidiaries and the parties referred to in Schedule 4 to this Agreement,
as more particularly described therein, and all other agreements subsequently
entered into by the Borrower, which permit the Borrower to make use of
transmission poles or conduits of such parties in distributing cable television
signals.
"Prime Rate" shall mean, at any time, the rate of interest adopted by
Toronto Dominion (Texas), Inc. (or, at such time as Toronto Dominion (Texas),
Inc. no longer serves as Administrative Agent hereunder, by the successor
Administrative
General Communication, Inc. - Form 8-K
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Agent named pursuant to Section 10.12 hereof) as its reference rate for the
determination of interest rates for loans of varying maturities in United States
dollars to United States residents of varying degrees of creditworthiness and
being quoted at such time by such Bank as its "prime rate." The Prime Rate is
not necessarily the lowest rate of interest charged to borrowers of Toronto
Dominion (Texas), Inc. or any successor Administrative Agent.
"Prior Administrative Agent" shall have the meaning assigned to it in
the first paragraph of the Recitals on page 1 hereof.
"Prior Borrower" shall have the meaning assigned to it in the Recitals
of this Agreement.
"Prior Loan Agreement" shall have the meaning assigned to it in the
Recitals of this Agreement.
"Prime Cable System" shall mean the cable television systems which on
even date herewith shall be acquired by the Borrower pursuant to the GCI
Acquisition and which shall be owned, operated and maintained by the Borrower or
its Subsidiaries.
"Pro Forma Debt Service" shall mean as of the end of any calendar
quarter, Debt Service for the next succeeding four calendar quarters. For
purposes of calculating Pro Forma Debt Service, it shall be assumed that (i) the
effective, blended rate of interest on the Loans on the last day of such
calendar quarter shall be the rate of interest for the four calendar quarters
for which Pro Forma Debt Service is being calculated, after giving effect to
Eurodollar Advances and Interest Hedge Agreements, and (ii) the principal amount
outstanding on the last day of such calendar quarter shall be the principal
amount of the Loans outstanding for each day during the calendar four-quarter
period for which Pro Forma Debt Service is being calculated, except that the
effect of Required Repayments shall be taken into account.
"Property" shall mean any real property or personal property, plant,
building, facility, structure, underground storage tank or unit, equipment,
Inventory or other asset owned, leased or operated by Borrower or one of its
Subsidiaries (including, without limitation, any surface water thereon or
adjacent thereto, and soil and groundwater thereunder).
"Reportable Event" shall have the meaning set forth in Title IV of
ERISA.
"Request for Advance" shall mean any certificate of the Borrower
requesting an Advance hereunder, which certificate shall be denominated a
"Request for Advance," and shall be in substantially the form of Exhibit F-1
attached hereto, except for the Request for Advance for the initial Advance of
the Loans, which shall be in substantially the form of Exhibit F-2 attached
hereto. Each Request for Advance shall, among other things, (i) specify the date
of the Advance, which shall be a Business Day, the amount of the Advance, the
Interest Rate Basis selected by the Borrower and, with respect to Eurodollar
Advances, the Interest Period selected by the Borrower, and (ii) certify to the
Administrative Agent, the Managing Agents, and the Banks that there shall not
exist, on the date of the requested Advance and after giving effect thereto, any
Default hereunder.
General Communication, Inc. - Form 8-K
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"Request for Issuance of Letter of Credit" shall mean any certificate
signed by an Authorized Signatory, which certificate will be denominated a
"Request for Issuance of Letter of Credit" and shall be in substantially the
form attached hereto as Exhibit G. Each Request for Issuance of Letter of Credit
shall, among other things, (i) specify the beneficiary of the proposed Letter of
Credit, the purpose of the Letter of Credit, the proposed date of issuance of
the Letter of Credit, which shall be a Business Day, and the documents which
must be presented to draw under such Letter of Credit (including, without
limitation, any documents which T-D Bank may require), (ii) include, as an
attachment, the proposed form of the Letter of Credit, and (iii) state that
there shall not exist, on the date of the request and after giving effect to the
issuance of the Letter of Credit, a Default hereunder.
"Required Repayments" shall mean, for any period, the difference (to
the extent positive) between the aggregate Advances outstanding as of the first
day of such period and the Commitment as of the last day of such period (and
after giving effect to any required reduction on such date).
"Restricted Payment" shall mean (a) any direct or indirect
distribution, dividend, redemption or other payment to any Person (other than
the Borrower or any Subsidiary of the Borrower) on account of any general or
limited partnership interest in, or shares of capital stock or other securities
of, the Borrower or any of its Subsidiaries, including without limitation, any
warrants or other rights or options to acquire shares of capital stock of the
Borrower or any of its Subsidiaries; and (b) any management, consulting or other
similar fees, or any interest thereon, payable by the Borrower or any of its
Subsidiaries to the Manager, or any Affiliate of the Borrower, or to any other
Person, including but not limited to payments under the Management Agreement.
"Restricted Purchase" shall mean any payment on account of the
purchase, redemption or other acquisition or retirement of any general or
limited partnership interest in, or shares of capital stock or other securities
of the Parent Company, the Borrower or any of its Subsidiaries including without
limitation any warrants or other rights or options to acquire shares of capital
stock of the Parent Company, the Borrower and any of its Subsidiaries.
"Rock and Cooke Acquisitions" shall mean the transactions (as well as
all contemporaneous transactions associated therewith) which shall occur on or
shortly after the Agreement Date pursuant to which, among other things, (a) the
Borrower shall acquire the Alaska Cablevision System and all assets and business
related thereto pursuant to those three certain Asset Purchase Agreements, each
dated as of May 10, 1996 between General Communication, Inc. or its wholly-owned
subsidiary, on the one hand, and Alaska Cablevision, Inc., McCaw/Rock Seward
Cable Systems and McCaw/Rock Homer Cable Systems, on the other hand; and (b) the
Borrower shall acquire the Alaskan Cable Network System and all assets and
business related thereto pursuant to the Asset Purchase Agreement dated as of
April 15, 1996 between General Communication, Inc. or its wholly-owned
subsidiary and Alaskan Cable Network/Fairbanks, Inc., Alaskan Cable
Network/Juneau, Inc. and Alaskan Cable Network/Ketchikan-Sitka, Inc.
"Sales Transaction" shall have the meaning set forth in the definition
of "Net Proceeds" contained in this Article I.
General Communication, Inc. - Form 8-K
Page 174
"Security Agreement" shall mean that certain Second Amended and
Restated Security Agreement of even date, between the Borrower and the
Administrative Agent (for itself and for the ratable benefit of the Banks),
substantially in the form of Exhibit H attached hereto.
"Security Interest" shall have the meaning ascribed to such term in the
Security Agreement and in the Subsidiary Security Agreement.
"SMATV Systems" shall mean any satellite master antenna television
facilities used in providing cable television services to basic subscribers.
"Subordination and Assignment of Management Agreement" shall mean that
certain Subordination and Assignment of Management Agreement among the Manager,
the Borrower and the Administrative Agent, of even date, substantially in the
form of Exhibit I attached hereto, whereby, among other things, the Manager
assigns, on a nonrecourse basis, to the Administrative Agent (for itself and for
the ratable benefit of the Banks), as collateral for the Obligations its
interests under the Management Agreement, and as more fully provided therein,
subordinates to the repayment of the Obligations its right to receive payment of
management fees and other sums due under the Management Agreement.
"Subsidiary" shall mean, as applied to any Person, (a) any corporation
of which fifty percent (50%) or more of the outstanding stock (other than
directors' qualifying shares) having ordinary voting power to elect a majority
of its board of directors, regardless of the existence at the time of a right of
the holders of any class or classes of securities of such corporation to
exercise such voting power by reason of the happening of any contingency, or any
partnership of which fifty percent (50%) or more of the outstanding partnership
interests, is at the time owned by such Person, or by one or more Subsidiaries
of such Person, or by such Person and one or more Subsidiaries of such Person,
and (b) any other entity which is controlled or capable of being controlled by
such Person, or by one or more Subsidiaries of such Person, or by such Person
and one or more Subsidiaries of such Person. As of the Agreement Date, the
Subsidiaries of the Borrower are GCI Cable/Fairbanks, Inc., an Alaska
corporation; GCI Cable/Juneau, Inc., an Alaska corporation; GCI Cable Holdings,
Inc., an Alaska corporation; and Prime Cable of Alaska, L.P., a Delaware limited
partnership.
"Subsidiary Guaranty" shall mean that certain Subsidiary Guaranty of
even date, Substantially in the form of Exhibit J attached hereto.
"Subsidiary Security Agreement" shall mean that certain Amended and
Restated Subsidiary Security Agreement of even date, substantially in the form
of Exhibit K attached hereto.
"Syndication Agent" shall mean NationsBank of Texas, N.A., and any
other Person that becomes a Syndication Agent hereunder.
"Systems" shall mean, collectively, the cable television systems
(including SMATV Systems) which are owned, operated and maintained by the
Borrower or any of its Subsidiaries pursuant to the terms of the Licenses, and
any other cable television systems or any SMATV Systems, now owned or hereafter
acquired by the
General Communication, Inc. - Form 8-K
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Borrower or any of its Subsidiaries, in accordance with the terms and conditions
of this Agreement. As of or shortly after the Agreement Date, the Systems shall
include the Alaska Cablevision System, Alaskan Cable Network and the Prime Cable
System.
"T-D Bank" shall mean The Toronto-Dominion Bank, acting through its
Houston Agency.
"Total Debt" shall mean at any time, the outstanding principal amount
of the Loans.
"Total Interest Expense" shall mean, for any calendar quarter of the
Borrower, accrued cash interest expense for the Loans determined in accordance
with GAAP.
"UCC" shall mean the Uniform Commercial Code as in effect in the State
of New York from time to time.
"Use of Proceeds Letter" shall mean that certain Use of Proceeds Letter
in substantially the form attached hereto as Exhibit L, delivered to the
Administrative Agent, the Managing Agents, and the Banks at closing pursuant to
Section 3.1 hereof.
* * * * *
Each definition of an agreement in this Article 1 shall include such
agreement as amended from time to time with the prior written consent of the
Majority Banks, except as provided in Section 11.13 hereof. Unless otherwise
expressly stated herein, all references to financial information and results of
the Borrower shall be determined on a consolidated basis with the Borrower's
Subsidiaries.
ARTICLE 2
The Loans
Section 2.1 The Loans.
(a) Loans. The Banks agree, severally in accordance with their
respective Commitment Ratios and not jointly, upon the terms and subject to the
conditions of this Agreement, to lend and re-lend to the Borrower, on and after
the Agreement Date, but prior to the Maturity Date, an amount not to exceed, in
the aggregate, the amount of the Commitment, less the aggregate face amount of
any outstanding Letters of Credit. Advances under the Commitment shall, at the
option of the Borrower as provided in Section 2.2 hereof (except with respect to
Advances representing reimbursement by the Banks to T-D Bank of amounts advanced
to beneficiaries under Letters of Credit, which Advances shall in all cases be
Base Rate Advances), be made as Base Rate Advances or Eurodollar Advances.
Advances under the Commitment may be converted or rolled over as provided in
Section 2.2 hereof in order to rollover Eurodollar Advances for new Interest
Periods or to otherwise effect changes in the Interest Rate Basis applicable to
the Advances thereunder.
(b) Letters of Credit. T-D Bank agrees, prior to the Maturity
Date and upon the terms and subject to the conditions of this Agreement, to
issue from time to time
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for the account of the Borrower, in the ordinary course of business of the
Borrower, Letters of Credit to such beneficiaries as shall be designated in
writing by the Borrower to T-D Bank, in an aggregate face amount not to exceed
$1,000,000. The amount available for Advances under the Commitment shall be
reduced by the aggregate face amount of all outstanding Letters of Credit.
Section 2.2 Manner of Borrowing and Disbursement.Disbursement
(a) Choice of Interest Rate, Etc. Any Advance (except with
respect to Advances in reimbursement of amounts advanced to beneficiaries under
Letters of Credit, which Advances shall in all cases be Base Rate Advances)
shall, at the option of the Borrower, be made as a Base Rate Advance or a
Eurodollar Advance; provided, however, that at such time as there shall have
occurred and be continuing a Default hereunder, the Borrower shall not have the
right to borrow any Eurodollar Advances, to rollover any Eurodollar Advances, or
to convert any Base Rate Advances to Eurodollar Advances, and all subsequent
Advances during the continuance of such Default under the Commitment shall be
made as Base Rate Advances. Any notice given to the Administrative Agent in
connection with a requested Advance hereunder shall be given to the
Administrative Agent prior to 10:00 a.m. (Houston time) in order for such
Business Day to count toward the minimum number of Business Days required.
(b) Base Rate Advances.
(i) Initial Advances. The Borrower shall give the
Administrative Agent in the case of Base Rate Advances at least one (1) Business
Days' irrevocable prior written notice in the form of a Request for Advance, or
telephonic notice followed immediately by a Request for Advance; provided,
however, that the Borrower's failure to confirm any telephonic notice with a
Request for Advance shall
not invalidate any notice so given. Upon receipt of such notice from the
Borrower, the Administrative Agent shall promptly notify each Bank by telephone
or telecopy of the contents thereof.
(ii) Prepayments and Conversions. Upon at least one (1),
with respect to item (B) of this sentence, or three (3), with respect to item
(A) of this sentence, Business Days' irrevocable prior written notice to the
Administrative Agent, and subject to the provisions of Section 2.2(c)(iii), the
Borrower may (A) convert all or a portion of the principal of a Base Rate
Advance to one or more Eurodollar Advances, or (B) prepay all or any portion of
such Base Rate Advance. On the date indicated by the Borrower, such Base Rate
Advance shall be so repaid or, as applicable, converted. Advances prepaid or
repaid (and not converted or rolled over at such time) under the Commitment may
be reborrowed and will not permanently reduce the Commitment unless otherwise
specified in accordance with Section 2.5(b) hereof.
(c) Eurodollar Advances.
(i) Initial Advances. The Borrower shall give the
Administrative Agent in the case of Eurodollar Advances at least three (3)
Business Days' irrevocable prior written notice in the form of a Request for
Advance, or telephonic notice followed immediately by a Request for Advance;
provided, however, that the Borrower's failure to confirm any telephonic notice
with a Request for Advance shall
General Communication, Inc. - Form 8-K
Page 177
not invalidate any notice so given. The Administrative Agent, whose
determination shall be conclusive in the absence of manifest error, shall
determine the available Eurodollar Bases and shall promptly notify the Borrower
of such Eurodollar Bases. The Borrower shall promptly notify the Administrative
Agent by telephone or telecopy, and shall immediately confirm any such
telephonic notice in writing, of its selection of a Eurodollar Basis and
Interest Period for such Advance; provided, however, that the Borrower's failure
to confirm any such telephonic notice in writing shall not invalidate any notice
so given. Upon receipt of such notice from the Borrower, the Administrative
Agent shall promptly notify each Bank by telephone or telecopy of the contents
thereof.
(ii) Prepayments and Conversions. At least three (3)
Business Days prior to each Payment Date for a Eurodollar Advance, the Borrower
shall give the Administrative Agent written notice specifying whether all or a
portion of any Eurodollar Advance outstanding on the Payment Date (A) is to be
rolled over as another Eurodollar Advance, (B) is to be converted to a Base Rate
Advance, or (C) is to be repaid. Eurodollar Advances may be prepaid prior to the
applicable Payment Date upon at least three (3) Business Days prior written
notice to the Administrative Agent, in accordance with the terms of Section 2.5
hereof. Upon such Payment Date such Eurodollar Advance will, subject to the
provisions hereof, be so rolled over, repaid or, and, as applicable, converted.
Advances prepaid or repaid (and not converted or rolled over at such time) under
the Commitment may be reborrowed and will not permanently reduce the Commitment
unless otherwise specified in accordance with Section 2.5(b) hereof.
(iii) Maximum Eurodollar Advances. At no time may the
number of outstanding Eurodollar Advances exceed five (5).
(d) Notification of Banks. Upon receipt of a Request for
Advance, or a notice from the Borrower with respect to any outstanding Advance
prior to the Payment Date for such Advance, or a request by T-D Bank for
reimbursement under Section 2.14 hereof, the Administrative Agent shall promptly
notify each Bank by telephone or telecopy of the contents thereof and the amount
of such Bank's portion of the Advance. Each Bank shall, not later than 12:00
noon (Houston time) on the date of borrowing specified in such notice, make
available to the Administrative Agent at the Administrative Agent's Office, or
at such account as the Administrative Agent shall designate, the amount of its
portion of any Advance which represents an additional borrowing hereunder in
immediately available funds.
(e) Disbursement.
(i) Prior to 1:00 p.m. (Houston time) on the date of an
Advance hereunder, the Administrative Agent shall, subject to the satisfaction
of the conditions set forth in Article 3, disburse the amounts made available to
the Administrative Agent by the Banks in immediately available funds by (a)
transferring the amounts so made available by wire transfer pursuant to the
Borrower's instructions, (b) in the case of an Advance representing the
reimbursement of T-D Bank for a draw under a Letter of Credit, transferring such
amounts to T-D Bank, or (c) in the absence of such instructions, crediting the
amounts so made available to the account of the Borrower maintained with the
Administrative Agent.
General Communication, Inc. - Form 8-K
Page 178
(ii) Unless the Administrative Agent shall have received
notice from a Bank prior to the close of business on the Business Day preceding
the date of any Advance that such Bank will not make available to the
Administrative Agent such Bank's ratable portion of such Advance, the
Administrative Agent may assume that such Bank has made or will make such
portion available to the Administrative Agent on the date of such Advance and
the Administrative Agent may in its sole discretion and in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount.
If and to the extent a Bank does not make such ratable portion available to the
Administrative Agent, such Bank agrees to repay to the Administrative Agent on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent, at a rate per annum equal to the
Federal Funds Rate. In the event that, at any time when the Borrower is not in
Default, a Bank for any reason fails or refuses to fund its portion of an
Advance, then, until such time as such Bank has funded its portion of such
Advance, or all other Banks have received payment in full (whether by repayment
or prepayment) of the principal and interest due in respect of such Advance,
such non-funding Bank shall not have the right (i) to vote regarding any issue
on which voting is required or advisable under this Agreement or any other Loan
Document, and the amount of the Loans of such Bank shall not be counted as
outstanding for purposes of determining "Majority Banks" hereunder, and (ii) to
receive payments of principal, interest or fees from the Borrower in respect of
its unfunded Advances.
(iii) If such Bank shall repay to the Administrative
Agent such corresponding amount, such amount so repaid shall constitute such
Bank's portion of the applicable Advance for purposes of this Agreement. If such
Bank does not repay such corresponding amount immediately upon the
Administrative Agent's demand therefor, the Administrative Agent shall notify
the Borrower and the Borrower shall promptly pay such corresponding amount to
the Administrative Agent, together with interest thereon at the interest rate
which would have been applicable to such Advance. The failure of any Bank to
fund its portion of any Advance shall not relieve any other Bank of its
obligation, if any, hereunder to fund its respective portion of the Advance on
the date of such borrowing, but no Bank shall be responsible for any such
failure of any other Bank.
Section 2.3 Interest.
(a) On Base Rate Advances. Interest on each Base Rate Advance
shall be computed on the basis of a year of 365/366 days (unless at any time
interest for a Base Rate Advance is based upon the Federal Funds Rate rather
than the Prime Rate, in which case interest shall be computed on the basis of a
year of 360 days) for the actual number of days elapsed and shall be payable in
arrears on the applicable Payment Date for the period through the date
immediately preceding such Payment Date. Interest on Base Rate Advances then
outstanding shall also be due and payable on the Maturity Date. Interest shall
accrue and be payable on each Base Rate Advance at the simple per annum interest
rate equal to the sum of (A) the Base Rate, and (B) the Applicable Margin in
effect from time to time and as more fully set forth in Section 2.3(f) below.
(b) On Eurodollar Advances. Interest on each Eurodollar Advance
shall be computed on the basis of a 360-day year for the actual number of days
elapsed and
General Communication, Inc. - Form 8-K
Page 179
shall be payable in arrears on the applicable Payment Date for the period
through the day immediately preceding such Payment Date, and, in addition, if
the Interest Period for a Eurodollar Advance exceeds three (3) months, interest
on such Eurodollar Advance shall also be due and payable in arrears on every
three-month anniversary of the beginning of such Interest Period. Interest on
Eurodollar Advances then outstanding shall also be due and payable on the
Maturity Date. Interest shall accrue and be payable on each Eurodollar Advance
at a rate per annum equal to (A) the Eurodollar Basis applicable to such
Eurodollar Advance, plus (B) the Applicable Margin in effect from time to time
and as more fully set forth in Section 2.3(f) below.
(c) Interest Upon Default. Upon the occurrence of an Event of
Default, the Majority Banks shall have the option, but shall be under no
obligation, to agree in writing with the Administrative Agent that interest on
the outstanding Obligations shall accrue at the Default Rate from the date of
such Event of Default. Interest accruing at the Default Rate shall be payable on
demand and in any event on the Maturity Date and shall accrue until the earliest
to occur of (i) cure of such Event of Default or waiver in writing by the Banks
or the Majority Banks, as required under Section 11.13 hereof, of the applicable
Event of Default, (ii) agreement by the Majority Banks to rescind the charging
of interest at the Default Rate, or (iii) payment in full of the Obligations.
The Banks shall not be required to (i) accelerate the maturity of the Loans, or
(ii) exercise any other rights or remedies under the Loan Documents in order to
charge interest hereunder at the Default Rate. The Administrative Agent shall
promptly notify the Borrower and the Banks of any agreement by the Majority
Banks to charge interest at the Default Rate.
(d) Interest if no Notice of Selection of Interest Rate Basis.
If the Borrower fails to give the Administrative Agent timely notice of its
selection of a Eurodollar Basis, or if for any reason a determination of a
Eurodollar Basis for any Advance is not timely concluded, such Advance shall be
made as a Base Rate Advance.
(e) Computation of Interest. In computing interest on any
Advance, the date of making the Advance shall be included and the date of
payment shall be excluded; provided, however, that if an Advance is repaid on
the date that it is made, one (1) day's interest shall be due with respect to
such Advance.
(f) Applicable Margin. The Applicable Margin with respect to any
Advance shall be the interest rate margin determined by the Administrative Agent
based upon the Leverage Ratio for the most recent calendar quarter end,
effective as of the second Business Day after the financial statements referred
to in Section 6.1 hereof are delivered by the Borrower to the Administrative
Agent for the calendar quarter most recently ended, expressed as a per annum
rate of interest as follows:
General Communication, Inc. - Form 8-K
Page 180
Base Rate Eurodollar
Advance Advance
Leverage Ratio Applicable Margin Applicable Margin
-----------------------------------------------------------------------------------------------------
Greater than 6.50 1.875% 2.875%
Less than or equal to 6.50 but greater than 1.625% 2.625%
6.00
Less than or equal to 6.00 but greater than 1.125% 2.125%
5.50
Less than or equal to 5.50 but greater than 0.750% 1.750%
5.00
Less than or equal to 5.00 but greater than 0.625% 1.625%
4.50
Less than or equal to 4.50 but greater than 0.375% 1.375%
4.00
Less than or equal to 4.00 0.125% 1.125%
In the event that the Borrower fails to timely provide the financial statements
referred to above in accordance with the terms of Section 6.1 hereof, and
without prejudice to any additional rights under Section 8.2 hereof, no downward
adjustment of the Applicable Margin in effect for the preceding quarter shall
occur until the actual delivery of such statements.
Section 2.4 Fees and Additional Compensation.
(a) Fees Payable Under the Fee Letters. The Borrower agrees to
pay to the Administrative Agent, for the benefit of the Administrative Agent,
the Managing Agents and the Banks, as the case may be, such fees as are mutually
agreed upon and as are described in the Fee Letters.
(b) Commitment Fee. In addition, the Borrower agrees to pay to
the Administrative Agent, for the benefit of each of the Banks in accordance
with their respective Commitment Ratios, a commitment fee on the aggregate
unborrowed balance of the Commitment, for each day from the Agreement Date until
the Maturity Date, at a rate equal to one-half of one percent (1/2%) per annum.
Such commitment fee shall be computed on the basis of a year of 365/366 days for
the actual number of days elapsed, shall be payable quarterly in arrears on the
last day of each calendar
General Communication, Inc. - Form 8-K
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quarter, commencing on December 31, 1996, shall be
fully earned when due, and shall be non-refundable when paid. A final payment of
any commitment fee then payable shall also be due and payable on the Maturity
Date.
(c) Letter of Credit Fee. The Borrower agrees to pay to the
Administrative Agent for the benefit of the Banks, in accordance with their
respective Commitment Ratios, a letter of credit fee equal to two percent (2%)
per annum (computed on the basis of a year of 365/366 days for the actual number
of days elapsed), of the face amount of each Letter of Credit. Such letter of
credit fee shall be due and payable quarterly in arrears on the last day of each
calendar quarter during which a Letter of Credit was outstanding and, if then
unpaid, on the Maturity Date. Such letter of credit fee shall be fully earned
when due and nonrefundable when paid. In the event of any inconsistency between
the terms of this Agreement and the terms of any letter of credit reimbursement
agreements or indemnification agreements between the Borrower and T-D Bank with
respect to the Letters of Credit, the terms of this Agreement shall control.
(d) Issuing Bank Fee. The Borrower agrees to pay to the
Administrative Agent for the benefit of T-D Bank, a fee equal to one-half of one
percent (0.5%) per annum (computed on the basis of a year of 365/366 days for
the actual number of days elapsed), of the face amount of each Letter of Credit,
which fee shall be due and payable quarterly in arrears on the last day of each
calendar quarter during which a Letter of Credit was outstanding and, if then
unpaid, on the Maturity Date. The foregoing fee shall be fully earned when due
and nonrefundable when paid. In the event of any inconsistency between the terms
of this Agreement and the terms of any letter of credit reimbursement agreements
or indemnification agreements between the Borrower and T-D Bank with respect to
the Letters of Credit, the terms of this Agreement shall control.
(e) Computation of Fees. In computing any fees payable under
this Section 2.4, the first day of the applicable period shall be included and
the date of payment shall be excluded.
Section 2.5 Voluntary Prepayment/Voluntary Reduction of
Commitment.
(a) The principal amount of any Base Rate Advance may be prepaid
in full or in part at any time upon one (1) Business Day's prior written notice
to the Administrative Agent, without penalty or premium; and the principal
amount of any Eurodollar Advance may be prepaid without penalty or premium prior
to the applicable Payment Date, upon three (3) Business Days' prior written
notice to the Administrative Agent, provided that Borrower shall reimburse any
Bank for any loss or reasonable out-of-pocket expense incurred by such Bank in
connection with such prepayment, as set forth in Section 2.10 hereof. Each
notice of prepayment shall be irrevocable. Upon receipt of any notice of
prepayment, the Administrative Agent shall promptly notify each Bank of the
contents thereof by telephone or telecopy and of such Bank's portion of the
prepayment. Prepayments of principal hereunder in respect of Base Rate Advances,
shall be in minimum amounts of $500,000 and integral multiples of $100,000, and
prepayments of principal hereunder in respect of Eurodollar Advances shall be in
minimum amounts of $1,000,000 and integral multiples of $250,000.
Advances prepaid pursuant to this Section 2.5(a) may be reborrowed.
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Page 182
(b) The Borrower shall have the right, at any time and from time
to time after the Agreement Date, and prior to the Maturity Date, upon at least
three (3) Business Days' prior written notice to the Administrative Agent,
without premium or penalty, to cancel or reduce permanently all or a portion of
the Commitment on a pro rata basis among the Banks in accordance with the
Commitment Ratios, provided that any such partial reduction shall be made in an
amount not less than $1,000,000 and in integral multiples of $500,000 thereof.
As of the date of cancellation or reduction set forth in such notice, the
Commitment shall be permanently reduced to the amount stated in the Borrower's
notice for all purposes herein, and the Borrower shall pay to the Administrative
Agent for the benefit of the Banks the amount necessary to reduce the principal
amount of the then outstanding Loans to not more than the amount of the
Commitment as so reduced, together with the accrued interest on the amount so
prepaid and the commitment fee set forth in Section 2.4(b) accrued through the
date of the reduction with respect to the amount reduced, and shall reimburse
the Administrative Agent and the Banks for any loss or reasonable out-of-pocket
expense incurred by any of them in connection with such payment, as set forth in
Section 2.10. Each such reduction shall permanently reduce the amount of the
Commitment and shall reduce the dollar amount of each subsequent scheduled
quarterly Commitment reduction under Section 2.6 hereof on a pro rata basis.
Section 2.6 Scheduled Reduction of Commitment.
Commencing September 30, 1999 and at the end of each calendar
quarter thereafter, the Commitment shall be reduced by the amount set forth
below for such quarter:
Quarterly Ending
Reduction Maximum
Quarters Ending in Commitment Commitment
- --------------- ------------- ----------
September 30, 1999 through $5,125,000 $194,750,000
December 31, 1999
March 31, 2000 through $2,562,500 $184,500,000
December 31, 2000
March 31, 2001, through $5,125,000 $164,000,000
December 31, 2001
March 31, 2002, through $7,687,500 $133,250,000
December 31, 2002
March 31, 2003, through $10,250,000 $92,250,000
December 31, 2003
March 31, 2004, through $12,812,500 $41,000,000
December 31, 2004
March 31, 2005, through $13,666,666.67 $ 0.00
September 30, 2005
As of the date of each reduction of the Commitment as set forth above, the
Borrower shall pay to the Administrative Agent for the benefit of the Banks the
amount
General Communication, Inc. - Form 8-K
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necessary to reduce the principal amount of the Loans then outstanding to not
more than the amount of the Commitment as so reduced, together with accrued
interest on the amount so prepaid and the commitment fee set forth in Section
2.4(b) accrued through the date of the reduction with respect to the amount
reduced.
Section 2.7 Mandatory Reduction of Commitment. In addition to
the scheduled repayments and Commitment reductions provided for in Section 2.6
hereof, the Commitment shall be reduced and the Borrower shall, if required
pursuant to Section 2.7(c) hereof, prepay the Loans, without penalty or premium,
as follows:
(a) Excess Cash Flow. On, or at the Borrower's election prior
to, May 1, 2000, and on, or at the Borrower's election prior to, May 1st of each
year thereafter during the term of this Agreement, the Commitment shall be
reduced by an amount equal to fifty percent (50%) of the Borrower's Annual
Excess Cash Flow for the calendar year then most recently ended.
(b) Sales Transaction. If, after the Agreement Date, the
Borrower or any of its Subsidiaries, to the extent permitted hereunder,
consummates any Sales Transaction, the Commitment shall be reduced by an amount
equal to one hundred percent (100%) of the Net Proceeds received by the Borrower
or such Subsidiary from such Sales Transaction on the date of receipt of the
proceeds thereof by the Borrower or such Subsidiary.
(c) Application. Mandatory reductions pursuant to this Section
2.7 shall permanently reduce the amount of the Commitment but shall not reduce
the dollar amount of any subsequent scheduled quarterly Commitment reduction
under Section 2.6 hereof. As of the date of each reduction of the Commitment as
set forth above, the Borrower shall pay to the Administrative Agent for the
benefit of the Banks the amount, if any, necessary to reduce the principal
amount of the Loans then outstanding to not more than the amount of the
Commitment as so reduced, together with accrued interest on the amount so
prepaid and the commitment fee set forth in Section 2.4(b) accrued through the
date of the reduction with respect to the amount reduced.
Section 2.8 Notes; Loan Accounts.oan Accounts
(a) The Loans shall be repayable in accordance with the terms
and provisions set forth herein, and shall be evidenced by the Notes. One Note
shall be payable to the order of each Bank in accordance with their respective
Commitment Ratios. The Notes shall be issued by the Borrower to the Banks and
shall be duly executed and delivered by one or more Authorized Signatories.
(b) Each Bank may open and maintain on its books in the name of
the Borrower a loan account with respect to the Loans and interest thereon. Each
Bank which opens such a loan account shall debit such loan account for the
principal amount of each Advance made by it and accrued interest thereon, and
shall credit such loan account for each payment on account of principal of or
interest on its Loans. The records of a Bank with respect to the loan account
maintained by it shall be prima facie evidence of the Loans and accrued interest
thereon, but the failure of any Bank to maintain such records or to make any
such notations or any error or
General Communication, Inc. - Form 8-K
Page 184
mistake in such notations shall not affect the Borrower's repayment obligations
with respect to such Loans.
Section 2.9 Manner of Payment.
(a) Each payment (including any prepayment) by the Borrower on
account of the principal of or interest on the Loans, commitment fees, letter of
credit fees, and any other amount owed to the Banks, the Managing Agents or the
Administrative Agent or any of them under this Agreement or the Notes shall be
made not later than 1:00 p.m. (Houston time) on the date specified for payment
under this Agreement to the Administrative Agent at the Administrative Agent's
Office, for the account of the Banks, the Managing Agents or the Administrative
Agent, as the case may be, in lawful money of the United States of America in
immediately available funds. Any payment received by the Administrative Agent
after 1:00 p.m. (Houston time) shall be deemed received on the next Business
Day. Receipt by the Administrative Agent of any payment intended for any Bank or
Banks hereunder prior to 1:00 p.m. (Houston time) on any Business Day shall be
deemed to constitute receipt by such Bank or Banks on such Business Day. In the
case of a payment for the account of a Bank, the Administrative Agent will
promptly thereafter distribute the amount so received in like funds to such
Bank. If the Administrative Agent shall not have received any payment from the
Borrower as and when due, the Administrative Agent will promptly notify the
Banks accordingly.
(b) Subject to compliance by each Bank to the extent applicable
with the requirements of Section 2.13, the Borrower agrees to pay principal,
interest, fees and all other amounts due hereunder or under the Notes without
set-off or counterclaim or any deduction whatsoever.
(c) Prior to the declaration of an Event of Default under
Section 8.2 hereof, if some but less than all amounts due from the Borrower are
received by the Administrative Agent with respect to the Obligations, the
Administrative Agent shall distribute such amounts in the following order of
priority, all on a pro rata basis to the Banks: (i) to the payment on a pro rata
basis of any fees or expenses then due and payable to the Administrative Agent,
the Managing Agents, the Banks, or any of them; (ii) to the payment of interest
then due and payable on the Loans, on a pro rata basis; (iii) to the payment of
all other amounts not otherwise referred to in this Section 2.9(c) then due and
payable to the Administrative Agent, the Managing Agents, or the Banks, or any
of them, hereunder or under the Notes; and (iv) to the payment of principal then
due and payable on the Notes, on a pro-rata basis.
(d) Subject to any contrary provisions in the definition of
Interest Period, if any payment under this Agreement or any of the other Loan
Documents is specified to be made on a day which is not a Business Day, it shall
be made on the next Business Day, and such extension of time shall in such case
be included in computing interest and fees, if any, in connection with such
payment.
General Communication, Inc. - Form 8-K
Page 185
Section 2.10 Reimbursement.eimbursement
(a) Whenever any Bank shall sustain or incur any losses or
reasonable out-of-pocket expenses in connection with (i) failure by the Borrower
to borrow any Eurodollar Advance after having given notice of its intention to
borrow in accordance with Section 2.2 hereof (whether by reason of the
Borrower's election not to proceed or the non-fulfillment of any of the
conditions set forth in Article 3), other than in connection with a
determination made by the Administrative Agent, after consultation with the
Banks, under Section 9.1 hereof, or (ii) prepayment of any Eurodollar Advance in
whole or in part for any reason (including a prepayment pursuant to Sections
2.5, 2.6, 2.7, 9.2 or 9.3(b) hereof or as a result of the acceleration of the
Loans), the Borrower agrees to pay to such Bank, within five (5) Business Day's
from the Borrower's receipt of written demand from the Administrative Agent on
behalf of such Bank, an amount sufficient to compensate such Bank for all such
losses and reasonable out-of-pocket expenses. Such Bank's good faith
determination of the amount of such losses or out-of-pocket expenses, as set
forth in writing and accompanied by calculations in reasonable detail
demonstrating the basis for its demand, which shall be delivered to the Borrower
by the Administrative Agent on behalf of such Bank with each such demand, shall
be presumptively correct absent manifest error.
(b) Losses subject to reimbursement hereunder shall include,
without limiting the generality of the foregoing, expenses incurred by any Bank
or any participant of such Bank permitted hereunder in connection with the
re-employment of funds prepaid, repaid, not borrowed, or paid, as the case may
be, and the amount of such loss shall be the excess, if any, of (i) the interest
or other costs to such Bank of the deposit or other source of funding used to
make any such Eurodollar Advance, for the remainder of its Interest Period, over
(ii) the interest earned (or to be earned) by such Bank upon the re-lending or
other re-deployment of the amount of such Eurodollar Advance for the remainder
of its putative Interest Period.
Section 2.11 Pro Rata Treatment.
(a) Advances. Each Advance from the Banks under the Commitment
shall be made pro rata on the basis of the respective Commitment Ratios of the
Banks.
(b) Payments. Except as provided in Section 2.2(e)(ii) hereof,
prior to the declaration of an Event of Default by the Administrative Agent on
behalf of the Banks under Section 8.2 hereof, each payment and prepayment of the
Loans, and, except as provided in Article 9 hereof, each payment of interest on
the Loans, shall be made to the Banks pro rata on the basis of their respective
Commitment Ratios. If any Bank shall obtain any payment (whether involuntary,
through the exercise of any right of set-off, or otherwise) on account of the
Loans made by it in excess of its ratable share of the Loans under its
Commitment Ratio, such Bank shall forthwith purchase from the other Banks such
participations in the Loans made by them as shall be necessary to cause such
purchasing Bank to share the excess payment ratably with each of them according
to their respective Commitment Ratios; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Bank, such purchase from each Bank shall be rescinded and such Bank shall repay
to the purchasing Bank the purchase price to the extent of such recovery. The
Borrower agrees that any Bank so purchasing a participation from another Bank
pursuant to this
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Section 2.11(b) may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
participation as fully as if such Bank were the direct creditor of the Borrower
in the amount of such participation. The provisions of this Section 2.11(b) set
forth the rights of the Banks with respect to payment, and are not enforceable
for the benefit of the Borrower.
(c) Payments Subsequent to Declaration of Event of Default.
Subsequent to the declaration of an Event of Default by the Administrative Agent
under Section 8.2 hereof, payments and prepayments made to the Administrative
Agent, any Managing Agent, or the Banks or otherwise received by the
Administrative Agent, any Managing Agent, or any Bank, shall be distributed as
provided in Section 8.2 hereof.
Section 2.12 Capital Adequacy. If, after the date hereof, any
Bank shall have reasonably determined that the adoption of any Applicable Law
regarding the capital adequacy of banks or bank holding companies, or any change
in Applicable Law (whether adopted before or after the Agreement Date) or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Bank with any directive regarding
capital adequacy (whether or not having the force of law) of any such
governmental authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Bank's capital as a consequence of
its obligations hereunder to a level below that which it could have achieved but
for such adoption, change or compliance (taking into consideration such Bank's
policies with respect to capital adequacy immediately before such adoption,
change or compliance and assuming that such Bank's capital was fully utilized
prior to such adoption, change or compliance) by an amount reasonably deemed by
such Bank to be material, then, within sixty (60) days of written demand by such
Bank, the Borrower shall in its discretion, (i) provide a replacement bank or
banks for such Bank, which replacement bank or banks will be subject to the
approval of the Administrative Agent and the Majority Banks (which approval will
not be unreasonably withheld), and shall take all necessary actions to transfer
the rights, duties and obligations of such Bank to such replacement bank or
banks within such 60-day period (including the payment in full of all
Obligations hereunder due to the Bank being replaced) or (ii) thereafter from
time to time upon written demand by such Bank, promptly pay to such Bank such
additional amounts as shall be sufficient to compensate such Bank for such
reduced return, together with interest on such amount from the fourth (4th) day
after the date of demand until payment in full thereof at the Base Rate plus the
Applicable Margin in effect for Base Rate Advances. A certificate of such Bank
setting forth the amount to be paid to such Bank by the Borrower as a result of
any event referred to in this paragraph and supporting calculations in
reasonable detail, which shall be delivered to the Borrower by such Bank with
any such demand, shall be conclusive, absent manifest error, and, at the
Borrower's request, such Bank shall demonstrate the basis for such
determination. Each Bank further agrees that it shall use reasonable, good faith
efforts to give the Borrower thirty (30) days prior notice of any proposed
adoption of or any change in any Applicable Law regarding capital adequacy of
banks or bank holding companies, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by such Bank with any request or directive regarding capital adequacy (whether
or not having the force of law) of any such governmental authority, central bank
or comparable agency which may have
General Communication, Inc. - Form 8-K
Page 187
the effect of reducing the rate of return on such Bank's capital as a
consequence of its obligation hereunder to a level below that which it could
have achieved but for such adoption, change or compliance by an amount which may
be deemed by such Bank to be material.
Section 2.13 Bank Tax Forms. On or prior to the Agreement Date
and on or prior to the first Business Day of each calendar year thereafter, each
Bank which is organized in a jurisdiction other than the United States shall
provide the Administrative Agent and the Borrower with two (2) properly executed
originals of Forms 4224 or 1001 (or any successor forms) prescribed by the
Internal Revenue Service or other documents satisfactory to the Borrower and the
Administrative Agent, and properly executed Internal Revenue service Forms W-8
or W-9, as the case may be, certifying (i) as to such Bank's status for purposes
of determining exemption from United States withholding taxes with respect to
all payments to be made to such Bank hereunder and under the Notes or (ii) that
all payments to be made to such Bank hereunder and under the Notes are subject
to such taxes at a rate reduced to zero by an applicable tax treaty. Each such
Bank agrees to provide the Administrative Agent and the Borrower with new forms
prescribed by the Internal Revenue Service upon the expiration or obsolescence
of any previously delivered form, or after the occurrence of any event requiring
a change in the most recent forms delivered by it to the Administrative Agent
and the Borrower.
Section 2.14 Letters of Credit.
(a) Upon receipt by T-D Bank of at least ten (10) Business Days'
written notice from the Borrower requesting the issuance of a Letter of Credit
in the form of a Request for Issuance of Letter of Credit, T-D Bank shall
promptly forward such Request for Issuance of Letter of Credit to the
Administrative Agent which shall forward a copy thereof to each Managing Agent
and each Bank hereunder, and a Letter of Credit shall be issued in the amount
requested, provided that (i) no Default then exists or would be caused thereby,
(ii) after giving effect to the requested issuance, the aggregate face amount of
all Letters of Credit outstanding hereunder would not exceed $1,000,000, and
(iii) the issuance of the Letter of Credit together with Loans outstanding under
the Commitment would not cause the Commitment as then in effect to be exceeded.
No Letter of Credit shall have a maturity extending beyond the earlier of (x) a
term of one (1) year from the date of issuance, or (y) the Maturity Date.
Subject to the maturity limitations provided herein and so long as no Default
then exists or would be caused thereby, Letters of Credit shall be renewable
annually upon the request of the Borrower and with the consent of T-D Bank,
which consent shall not be unreasonably withheld but shall be subject to
compliance with customary letter of credit practices at the times of any
proposed renewal. Each notice from the Borrower requesting the issuance of a
Letter of Credit shall specify in reasonable detail the documents which must be
presented to draw under such Letter of Credit, which specification shall include
all documents which T-D Bank may require.
(b) If a Letter of Credit provides that it is automatically
renewable unless notice is given by T-D Bank that it will not be renewed, T-D
Bank shall not be bound to give a notice of non-renewal unless directed to by
the Majority Banks at least sixty-five (65) days prior to the then scheduled
expiration date of such Letter of Credit.
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(c) Provided that no Default then exists or would be caused
thereby, each Bank irrevocably authorizes T-D Bank to issue, reconfirm, reissue
and extend each Letter of Credit in accordance with the terms of this Agreement.
T-D Bank hereby sells, and each other Bank hereby purchases, on a continuing
basis, a participation and an undivided interest in (A) the obligations of T-D
Bank to honor any draws under the Letters of Credit issued pursuant to this
Agreement, including any Letters of Credit issued and outstanding as of the
Agreement Date, as shown on Schedule 1 attached hereto, and (B) the Indebtedness
of the Borrower to T-D Bank under this Agreement in respect of each Letter of
Credit, such participation being in the amount of such Bank's pro rata share of
such obligations and Indebtedness based on such Bank's Commitment Ratio.
(d) Upon receipt of a draw certificate from the beneficiary of a
Letter of Credit, T-D Bank shall promptly notify the Administrative Agent, which
shall in turn notify the Borrower, the Managing Agents, and each Bank, by
telephone or telecopy, of the amount of the requested draw and, in the case of
each Bank, such Bank's portion of such draw amount as calculated in accordance
with its Commitment Ratio.
(e) The Borrower hereby irrevocably requests and the Banks
hereby severally agree to make a Base Rate Advance to the Borrower
(notwithstanding the minimum amount requirements otherwise applicable to Base
Rate Advances) on each day on which a draw is made under any Letter of Credit
and in the amount of such draw, and each Bank shall fund such Bank's share of
such Base Rate Advance by payment to the Administrative Agent in accordance with
Section 2.2(e) hereof and its Commitment Ratio, without reduction for any
set-off counterclaim of any nature whatsoever. The obligation of each Bank to
make payments to the Administrative Agent, for the account of T-D Bank, in
accordance with this Section 2.14 shall be absolute and unconditional and no
Bank shall be relieved of its obligations to make such payments by reason of
non-compliance by any other Person with the terms of the Letter of Credit or for
any other reason other than the gross negligence or willful misconduct of the
Administrative Agent or T-D Bank. The Administrative Agent shall promptly remit
to T-D Bank the amounts so received from the Banks.
(f) The Borrower agrees that any action taken or omitted to be
taken by T-D Bank in connection with any Letter of Credit, except for such
actions or omissions as shall constitute gross negligence or willful misconduct
on the part of T-D Bank, shall be binding on the Borrower as between the
Borrower and T-D Bank, and shall not result in any liability of T-D Bank to the
Borrower. The obligation of the Borrower to reimburse the Banks for Advances
made to reimburse T-D Bank for draws under the Letter of Credit shall be
absolute, unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement under all circumstances whatsoever,
including, without limitation, the following circumstances:
(i) Any lack of validity or enforceability of any
Loan Document;
(ii) Any amendment or waiver of or consent to any
departure from any or all of the Loan Documents;
(iii) Any improper use which may be made of any
Letter of Credit or any improper acts or omissions of any beneficiary or
transferee of any Letter of Credit in connection therewith;
General Communication, Inc. - Form 8-K
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(iv) The existence of any claim, set-off, defense
or any right which the Borrower may have at any time against any beneficiary or
any transferee of any Letter of Credit (or Persons for whom any such beneficiary
or any such transferee may be acting) or any Bank (other than the defense of
payment to such Bank in accordance with the terms of this Agreement) or any
other Person, whether in connection with any Letter of Credit, any transaction
contemplated by any Letter of Credit, this Agreement, any other Loan Document,
or any unrelated transaction;
(v) Any statement or any other documents presented
under any Letter of Credit proving to be insufficient, forged, fraudulent or
invalid in any respect or any statement therein being untrue or inaccurate in
any respect whatsoever, provided that such payment shall not have constituted
gross negligence or willful misconduct of T-D
Bank;
(vi) The insolvency of any Person issuing any
documents in connection with any Letter of Credit;
(vii) Any breach of any agreement between the
Borrower and any beneficiary or transferee of any Letter
of Credit;
(viii) Any irregularity in the transaction with
respect to which any Letter of Credit is issued, including any fraud by the
beneficiary or any transferee of such Letter of Credit;
(ix) Any errors, omissions, interruptions or delays
in transmission or delivery of any messages, by mail, cable, telegraph, wireless
or otherwise, whether or not they are in code;
(x) Any act, error, neglect or default, omission,
insolvency or failure of business of any of the correspondents of T-D Bank,
provided that the same shall not have constituted the gross negligence or
willful misconduct of T-D Bank;
(xi) Any other circumstances arising from causes
beyond the control of T-D Bank;
(xii) Payment by T-D Bank under any Letter of
Credit against presentation of a sight draft or a certificate which does not
comply with the terms of such Letter of Credit, provided that such payment shall
not have constituted gross negligence or willful misconduct of T-D Bank; and
(xiii) Any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, provided that such
other circumstances or happenings shall not have been the result of gross
negligence or wilful misconduct of T-D Bank or any Bank.
(g) If, after the Agreement Date, any change in Applicable Law,
any change in the interpretation or administration thereof, or any change in
compliance with Applicable Law by T-D Bank or any other Bank as a result of any
request or directive of any governmental authority, central bank or comparable
agency (whether or not having the force of law) shall (i) impose, modify or deem
applicable any reserve (including, without limitation, any imposed by the Board
of Governors of the Federal
General Communication, Inc. - Form 8-K
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Reserve System), special deposit, capital adequacy, assessment or other
requirements or conditions against letters of credit issued by T-D Bank or
against participations by any other Bank in the Letters of Credit or (ii) impose
on T-D Bank or any other Bank any other condition regarding any Letter of Credit
or any participation therein, and the result of any of the foregoing in the
reasonable determination of T-D Bank or such Bank, as the case may be, is to
increase the cost to T-D Bank or such Bank of issuing or maintaining any Letter
of Credit or purchasing or maintaining any participation therein, as the case
may be, by an amount (which amount shall be reasonably determined) deemed by T-D
Bank or such Bank to be material, then, on the earlier of five (5) days
following the date of demand (which demand shall be made not later than six (6)
months following such Bank's determination of a need for additional
compensation) by T-D Bank or such Bank or the Maturity Date, the Borrower shall
immediately pay T-D Bank or such Bank, as the case may be, such additional
amount or amounts as T-D Bank or such Bank, as the case may be, determines will
compensate it for such increased costs. Within sixty (60) days of such written
demand by T-D Bank or such Bank, the Borrower may, in its discretion, provide a
replacement bank or banks for T-D or such Bank, which replacement bank or banks
will be subject to the approval of the Administrative Agent and the Majority
Banks (which approval, in each case, will not be unreasonably withheld), and
shall take all necessary actions to transfer the rights, duties and obligations
of T-D Bank or such Bank to such replacement bank or banks within such 60-day
period. A certificate of such Bank setting forth the amount, and in reasonable
detail the basis for T-D Bank or such Bank's determination of such amount, to be
paid to T-D Bank or such Bank by the Borrower as a result of any event referred
to in this paragraph shall, absent manifest error, be conclusive. Such
certificate shall be delivered to the Borrower with each written demand for
payment referenced above. T-D Bank and each Bank further agree that they shall
use their best efforts to give the Borrower thirty (30) days prior notice, and
in any event shall give prompt notice, of any event referred to in this
paragraph which may have the effect of materially increasing the cost to T-D
Bank or such Bank of issuing or maintaining any T-D Letter of Credit or
purchasing or maintaining any participation therein.
(h) The Borrower will indemnify and hold harmless the
Indemnified Parties from and against any and all claims, liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (including reasonable
attorneys' fees) which may be imposed on, incurred by or asserted against the
Managing Agents, the Administrative Agent, T-D Bank or any Bank in any way
relating to or arising out of the issuance of a Letter of Credit, except that
the Borrower shall not be liable to any of the Indemnified Parties for any
portion of such claims, liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, or disbursements resulting from the
gross negligence or willful misconduct of the Managing Agents, T-D Bank, the
Administrative Agent, or such Bank, as the case may be, as determined by a
final, non-appealable judicial order. This Section 2.14(h) shall survive
termination of this Agreement.
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(i) Each Bank shall be responsible for its pro rata share (based
on such Bank's Commitment Ratio) of any and all reasonable out-of-pocket costs,
expenses (including reasonable legal fees) and disbursements which may be
incurred or made by T-D Bank in connection with the collection of any amounts
due under, the administration of, or the presentation or enforcement of any
rights conferred by any Letter of Credit, the Borrower's or any guarantor's
obligations to reimburse or otherwise. In the event the Borrower shall fail to
pay such expenses of T-D Bank within thirty (30) days of demand for payment by
T-D Bank, provided that T-D Bank has, during such thirty-day period, made a
diligent collection effort with respect to such expenses, and provided that such
costs shall not result from the gross negligence or willful misconduct of T-D
Bank, each Bank shall thereupon pay to T-D Bank its pro rata share (based on
such Bank's Commitment Ratio) of such expenses within ten (10) days from the
date of T-D Bank's notice to the Banks of the Borrower's failure to pay;
provided, however, that if the Borrower or any guarantor shall thereafter pay
such expense, T-D Bank will repay to each Bank the amounts received from such
Bank hereunder.
ARTICLE 3
Conditions Precedent
Section 3.1 Conditions Precedent to Initial Advance. The
obligation of the Banks to undertake the Commitment and to make the initial
Advance of the Loans is subject to the prior fulfillment of each of the
following conditions:
(a) The Administrative Agent shall have received each of the
following, for itself and for the benefit of the Banks, in form and substance
satisfactory to it:
(i) Loan Certificate from the Borrower, Parent
Company and each Subsidiary of the Borrower, substantially in the form attached
hereto as Exhibit M, including a certificate of incumbency with respect to each
officer authorized to execute Loan Documents on behalf of such entity, together
with appropriate attachments which shall include, without limitation, the
following items: (A) a copy of the Certificate of Incorporation or Partnership
Agreement and Certificate of Limited Partnership, as applicable, of such entity,
certified to be true, complete and correct by the appropriate governmental
authority, (B) certificates of good standing for such entity issued by the
Secretary of State or similar state official for each state in which such entity
is incorporated or required to qualify to do business, (C) a true, complete and
correct copy of the Bylaws of such entity, as in effect on the Agreement Date,
(D) a true, complete and correct copy of the resolutions of such entity
authorizing it to execute, deliver and perform the Loan Documents to which it is
a party, (E) a true, complete and correct copy of all shareholders' or other
similar agreements or voting trust agreements in effect with respect to the
stock or partnership interests of each entity, (F) a photocopy of the Licenses,
if any, held by such entity, certified by an Authorized Signatory to be in full
force and effect on the date hereof, (G) a list of the Pole Agreements, if any,
held by such entity, certified by an Authorized Signatory to be in full force
and effect on the date hereof, and (H) a copy of the Management Agreement;
(ii) This duly executed Loan Agreement;
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(iii) A duly executed Note to the order of each
Bank in the amount of such Bank's pro rata share of the Commitment;
(iv) The duly executed Security Agreement, together
with appropriate UCC-1 financing statement forms;
(v) Lien search results with respect to the
Borrower, its Subsidiaries, Parent Company, and the Manager from all appropriate
jurisdictions and filing offices, together with appropriate UCC-3 termination
statements relating to Liens which are not Permitted Liens;
(vi) Original Uniform Commercial Code Form 1
financing statements, signed by the Borrower as debtor and naming the
Administrative Agent as secured party to be filed in all appropriate
jurisdictions, in such form, substance and number as shall be satisfactory to
the Administrative Agent;
(vii) Copies of insurance certificates covering the
Collateral, naming the Administrative Agent as additional insured or named loss
payee, as applicable, and otherwise meeting the requirements of Section 5.5;
(viii) duly executed Mortgages granting the
Administrative Agent a mortgage to secure the Obligations on the real property
having a fair market value in excess of $250,000 owned in fee simple by the
Borrower or its Subsidiaries described on Schedule 5 hereto, together with
delivery to Administrative Agent of duly executed UCC-1 Financing Statements
under the applicable Uniform Commercial Code, or other filings under applicable
law, to be filed in connection with such Mortgage in form and substance
satisfactory to Administrative Agent to perfect the Lien created by the Mortgage
on any fixtures located on the real property covered by the Mortgage;
(ix) Proof of payment of all title insurance
premiums, documentary stamp or intangible taxes, recording fees and mortgage
taxes payable in connection with the recording of any of the Loan Documents or
the issuance of the title insurance commitments referred to above (whether due
on the Agreement Date or in the future) including such sums, if any, due in
connection with any future Advances;
(x) Copies of all existing environmental reviews
and audits with respect to all real property owned by the Borrower and other
information pertaining to actual or potential environmental claims as
Administrative Agent may require;
(xi) Opinions of general counsel, special counsel
to the Manager and the Prior Borrower, special Alaska Public Utilities
Commission counsel, and FCC counsel to the Borrower and its Subsidiaries,
addressed to each Managing Agent, each Bank, and the Administrative Agent and
satisfactory to each of them, dated the Agreement Date, in substantially the
forms attached hereto as Exhibits N-1, N-2, N-3 and N-4, respectively;
(xii) A duly executed Request for Initial Advance
of the Loans, in substantially the form attached hereto as Exhibit F-2;
(xiii) The duly executed Subordination and
Assignment of Management Agreement, and corresponding UCC-1 financing
statements;
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Page 193
(xiv) A duly executed Use of Proceeds Letter;
(xv) Copies of any Letters of Credit issued or
outstanding on the Agreement Date;
(xvi) Pro forma financial statements for the
Borrower and the Borrower's Subsidiaries as of the Agreement Date, with respect
to the balance sheet, and as of June 30, 1996, with respect to the income
statement;
(xvii) Copies of any pay-off letters, termination
statements, canceled mortgages and the like required by the Administrative Agent
in connection with the satisfaction of all Indebtedness of the Prior Borrower
under the Prior Loan Agreement and the removal of any Liens against the assets
of the Systems being acquired pursuant to the Rock and Cooke Acquisitions or
against the Borrower which are not Permitted Liens hereunder;
(xviii) A duly executed Certificate of Financial
Condition, issued by the Borrower and its Subsidiaries as of the Agreement Date,
and in substantially the form attached hereto as Exhibit O; and
(xix) Duly executed Borrower's Pledge Agreement,
together with appropriate Stock Certificates and Stock Powers;
(xx) Duly executed Parent's Pledge Agreement,
together with appropriate Stock Certificates and Stock Powers;
(xxi) Duly executed Subsidiary Security Agreement,
given by each Subsidiary of the Borrower, together with appropriate UCC-1
financing statement forms;
(xxii) Duly executed Subsidiary Guaranty, given by
each Subsidiary of the Borrower;
(xxiii) Duly executed Assignment of Partnership
Interests, given by the Borrower and GCI Cable Holdings, Inc. as related to
their general and limited partnership interests in Prime Cable of Alaska, L.P.;
(xxiv) All such other documents as any Managing
Agent, the Administrative Agent, or any Bank may reasonably request, certified
by an appropriate governmental official or an Authorized Signatory if so
requested.
(b) Completion of the GCI Acquisition and other transactions
associated therewith, as well as the completion of all documentation associated
therewith under terms satisfactory to the Administrative Agents, Managing
Agents, and the Banks.
(c) The Managing Agents, the Administrative Agent, and the Banks
shall have received evidence satisfactory to each of them that all Necessary
Authorizations, other than any contained on Schedule 6 hereto, have been
obtained or made, are in full force and effect and are not subject to any
pending or threatened reversal or cancellation, and shall have received a
certificate of an Authorized Signatory so stating.
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(d) The Administrative Agent, for itself, the Managing Agents,
and the Banks, shall have received all fees due on the Agreement Date from the
Borrower.
Section 3.2 Conditions Precedent to Each Advance. The obligation
of the Banks to make each Advance, including the initial Advance and including
those Advances made by virtue of Sections 2.2(b)(ii) and 2.2(c)(ii) hereof, is
subject to the fulfillment of each of the following conditions immediately prior
to or contemporaneously with such Advance:
(a) All of the representations and warranties of the Borrower
and its Subsidiaries under this Agreement and the other Loan Documents
(including, without limitation, all representations and warranties with respect
to the Borrower's Subsidiaries), which, pursuant to Section 4.2 hereof, are made
at and as of the time of such Advance, shall be true and correct at such time in
all material respects, except with respect to changes therein as permitted under
this Agreement, both before and after giving effect to the application of the
proceeds of the Advance;
(b) The incumbency of persons authorized by the Borrower to sign
documents shall be as stated in the certificate of incumbency delivered pursuant
to Section 3.1(a)(i) or as subsequently modified and reflected in a certificate
of incumbency delivered to the Administrative Agent, the Managing Agents, and
each of the Banks whose names appear on the signature pages hereof;
(c) There shall not exist, on the date of the making of the
Advance and after giving effect to the proceeds of the Advance, a Default or an
Event of Default hereunder, and the Administrative Agent shall have received a
Request for Advance signed by an Authorized Signatory so certifying, which
Request for Advance shall also certify the Borrower's compliance with Sections
7.8, 7.9, 7.10, 7.11 and 7.17 hereof; and
(d) The Administrative Agent, the Managing Agents, and each of
the Banks shall have received all such other certificates, reports, statements,
opinions of counsel or other documents as it may, having given the Borrower two
(2) Business Days' prior notice, reasonably request.
The Borrower hereby agrees that the delivery of any Request for Advance
hereunder shall be deemed to be the certification of the Authorized Signatory of
the Borrower as to the matters set forth in this Section 3.2.
Section 3.3 Conditions Precedent to Issuance of Each Letter of
Credit. The obligation of T-D Bank to issue any Letter of Credit hereunder is
subject to the prior fulfillment of each of the following conditions:
(a) All of the representations and warranties of the Borrower
under this Agreement, which, pursuant to Section 4.2 hereof, are made at and as
of the time of the issuance of such Letter of Credit, shall be true and correct
at such time in all material respects, except with respect to changes therein as
permitted under this Agreement, both before and after giving effect to the
issuance of such Letter of Credit;
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(b) The incumbency of persons authorized by the Borrower to sign
documents shall be as stated in the Certificate of Incumbency delivered pursuant
to Section 3.1(a)(i) or as subsequently modified and reflected in a certificate
of incumbency delivered to the Administrative Agent and each of the Banks;
(c) There shall not exist, on the date of the issuance of such
Letter of Credit and after giving effect thereto, a Default hereunder, and the
Administrative Agent shall have received a Request for Issuance of Letter of
Credit so stating; and
(d) The Administrative Agent, the Managing Agents, and the Banks
shall have received all such other certificates, reports, statements, opinions
of counsel or other documents as any of them may, having given the Borrower two
(2) Business Days prior notice, reasonably request.
ARTICLE 4
Representations and Warranties
Section 4.1 Representations and Warranties. The Borrower hereby
represents and warrants to the Administrative Agent, the Managing Agents, and
each of the Banks that:
(a) Organization; Power; Qualification. The Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Alaska having the Parent Company as its only shareholder of
record as of the Agreement Date. The Borrower has the corporate power and
authority to own its properties and to carry on its business as now being and
hereafter proposed to be conducted. Each Subsidiary of the Borrower is a
corporation or a limited partnership duly organized, validly existing and in
good standing under the laws of the state of its incorporation or formation, as
the case may be, and has the corporate or partnership power and authority, as
the case may be, to own its properties and to carry on its business as now being
and hereafter proposed to be conducted. The Borrower and each of its
Subsidiaries are duly qualified, in good standing and authorized to do business
in each jurisdiction in which the character of their respective properties or
the nature of their respective businesses requires such qualification or
authorization.
(b) Authorization. The Borrower has the corporate power and has
taken all necessary corporate action to authorize it to borrow hereunder, to
create the Security Interest pursuant to the Security Agreement, to execute,
deliver and perform this Agreement, any Mortgage, and each of the other Loan
Documents to which it is a party in accordance with their respective terms, and
to consummate the transactions contemplated hereby and thereby. This Agreement
has been duly executed and delivered by the Borrower and is, and each of the
other Loan Documents to which the Borrower is party is, a legal, valid and
binding obligation of the Borrower enforceable in accordance with its terms,
subject, as to enforcement of remedies, to the following qualifications: (i)
certain equitable remedies are discretionary and, in particular, may not be
available where damages are considered an adequate remedy at law, (ii)
enforcement may be limited by bankruptcy,
General Communication, Inc. - Form 8-K
Page 196
insolvency, liquidation, reorganization, reconstruction and other similar laws
affecting enforcement of creditors' rights generally (insofar as any such law
relates to the bankruptcy, insolvency or similar event of the Borrower), and
(iii) enforcement may be limited by local rules and regulations or by the
Licenses themselves or by FCC rules and regulations, as the case may be.
(c) Subsidiaries, Authorization; Enforceability. The Borrower's
Subsidiaries and the respective ownership interests therein as of the Agreement
Date are as set forth in Schedule 7 attached hereto. Each Subsidiary of the
Borrower has the corporate or partnership power, as the case may be, and has
taken all necessary corporate or partnership action to authorize it to execute,
deliver and perform each of the Loan Documents to which it is a party in
accordance with their respective terms and to consummate the transactions
contemplated by this Agreement and by such other Loan Documents. Each of the
Loan Documents to which any Subsidiary of the Borrower is party is a legal,
valid and binding obligation of such Subsidiary enforceable against such
Subsidiary in accordance with its terms, subject, as to enforcement of remedies,
to the following qualifications: (i) an order of specific performance and an
injunction are discretionary remedies and, in particular, may not be available
where damages are considered an adequate remedy at law, (ii) enforcement may be
limited by bankruptcy, insolvency, liquidation, reorganization, reconstruction
and other similar laws affecting enforcement of creditors' rights generally
(insofar as any such law relates to the bankruptcy, insolvency or similar event
of any such Subsidiary), and (iii) enforcement may be subject to general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law).
(d) Compliance with Other Loan Documents and Contemplated
Transactions. The execution, delivery and performance by the Borrower and its
Subsidiaries of this Agreement and each of the other Loan Documents to which it
is a party in accordance with their respective terms, and the consummation of
the transactions contemplated hereby and thereby, do not and will not (i)
require any consent or approval not already obtained, (ii) violate any
Applicable Law respecting the Borrower or any Subsidiary of the Borrower, (iii)
conflict with, result in a breach of, or constitute a default under the
currently operative certificate or articles of incorporation, bylaws or
partnership agreement, as the case may be, of the Borrower or of any Subsidiary
of the Borrower, or under any material indenture, agreement, or other
instrument, including without limitation the Licenses and the Pole Agreements,
to which the Borrower or any of its Subsidiaries is a party or by which any of
them or their properties may be bound, or (iv) result in or require the creation
or imposition of any Lien upon or with respect to any property now owned or
hereafter acquired by the Borrower or any of its Subsidiaries, except for
Permitted Liens.
(e) Business. The Borrower through its Subsidiaries is engaged
in the Cable Business and in leasing fiber capacity on the Systems to third
parties, and currently owns, operates and maintains the Systems.
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(f) Licenses etc. All Licenses have been authorized by the
grantors thereof and are in full force and effect, and the Borrower and its
Subsidiaries are in compliance in all material respects with all of the material
provisions thereof. Except as disclosed on Schedule 6 hereto, the Borrower has
secured all Necessary Authorizations and all such Necessary Authorizations are
in full force and effect. Neither any License nor any Necessary Authorization is
the subject of any pending or, to the best of the Borrower's knowledge,
threatened attack or revocation. No other license or franchise agreement with
respect to the territory covered by any License has been granted, nor, to the
best of the Borrower's knowledge, is any application for such a license or
franchise agreement pending, except as set forth on Schedule 8 attached hereto.
To the best of the Borrower's knowledge, there is no Person holding a cable
television franchise authorizing such Person to provide cable television
services in the franchise areas served by the Systems, except as set forth on
Schedule 8 attached hereto. As of the Agreement Date, there is no overbuilding
of any territory within the Systems.
(g) Compliance with Law. The Borrower and its Subsidiaries are
each in substantial compliance with all material Applicable Laws (including,
without limitation, FCC regulations regarding signal leakage).
(h) Title to Properties. The Borrower has good, legal and
marketable title to, or a valid leasehold interest in, all of its Assets. Each
of the Borrower's Subsidiaries has good, legal and marketable title, or a valid
leasehold interest in all of its assets. None of such Assets is subject to any
Liens, except for Permitted Liens. Except for financing statements evidencing
Permitted Liens or financing statements for which UCC-3 termination statements
have been tendered at closing on the Agreement Date, no financing statement
under the UCC and no other filing which names the Borrower or any of its
Subsidiaries as debtor or which covers or purports to cover any of the
Collateral is on file in any state or other jurisdiction, and neither the
Borrower nor any of its Subsidiaries has signed any such financing statement or
filing (except as described above) or, except for the Loan Documents, any
security agreement that has not been terminated, authorizing any secured party
thereunder to file any such financing statement or filing. Neither the Borrower
nor any of its Subsidiaries owns any real estate except (i) as set forth in
Schedule 5 attached hereto or (ii) as subsequently permitted under Section 7.13
hereof and provided a Mortgage on such real estate is granted to the
Administrative Agent, as agent for the Managing Agents and the Banks to the
extent required by Section 5.11 hereof.
(i) Litigation. There is no action, suit or proceeding pending
or, to the best of the Borrower's knowledge, threatened against or in any other
manner relating directly and adversely to, the Borrower, or any of its
Subsidiaries or any of their respective properties in any court or before any
arbitrator of any kind or before or by any governmental body, except as
described on Schedule 9 attached hereto, and no such action, suit, proceeding or
investigation (i) calls into question the validity of this Agreement or any
other Loan Document, or (ii) if determined adversely to the Borrower, or any of
its Subsidiaries, would be likely to have a Materially Adverse Effect.
(j) Taxes. All federal, state and other tax returns of the
Borrower and each of its Subsidiaries required by law to be filed have been duly
filed and all federal, state and other taxes, assessments and other governmental
charges or levies upon the
General Communication, Inc. - Form 8-K
Page 198
Borrower, all of its Subsidiaries, and any of their properties, income, profits
and assets, which are due and payable, have been paid, except any such taxes,
assessments or other governmental charges or levies (i) the payment of which is
being contested in good faith by appropriate proceedings, (ii) for which
adequate reserves have been provided on the books of the Borrower or the
Subsidiary of the Borrower involved, and (iii) as to which no Lien other than a
Permitted Lien has attached and no foreclosure, distraint, sale or similar
proceedings have been commenced. The charges, accruals and reserves on the books
of the Borrower and each of its Subsidiaries in respect of taxes are, in the
judgment of the Borrower, adequate.
(k) Financial Statements. The Borrower has furnished or caused
to be furnished to the Administrative Agent, the Managing Agents, and each of
the Banks the audited balance sheets and statements of income of the Parent
Company and the Prior Borrower for the calendar year ended December 31, 1995,
and the unaudited balance sheets and statements of income for the Parent
Company, the Prior Borrower, the Alaska Cablevision System and the Alaskan Cable
Network System for the calendar quarter ended June 30, 1996, which to the best
of the Borrower's knowledge as of the Agreement Date are complete and correct in
all material respects and present fairly in accordance with GAAP the financial
position of the Parent Company, the Prior Borrower, the Alaska Cablevision
System, and the Alaskan Cable Network System on and as at such dates and the
results of operations for the periods then ended. There are no material
liabilities, contingent or otherwise, of the Parent Company, the Borrower, and
the Borrower's Subsidiaries which are not disclosed in such financial
statements.
(l) No Adverse Change. Since June 30, 1996, there has occurred
no event which is likely to have a Materially Adverse Effect.
(m) ERISA. The Borrower, each of its Subsidiaries and each of
their respective ERISA Affiliates and each of their respective Plans are in
substantial compliance with ERISA and the Internal Revenue Code, and neither the
Borrower, nor any of its Subsidiaries, nor any of their respective ERISA
Affiliates has incurred any accumulated funding deficiency with respect to any
such Plan within the meaning of ERISA or the Internal Revenue Code. The Borrower
and its Subsidiaries have not incurred any material liability to the Pension
Benefit Guaranty Corporation or any successor thereto in connection with any
such Plan. The assets of each such Plan which is subject to Title IV of ERISA
are sufficient to provide the benefits under such Plan for which the Pension
Benefit Guaranty Corporation or any successor thereto would guarantee payment if
such Plan were terminated, and such assets are also sufficient to provide all
other benefits due under the Plan prior to and upon termination. No Reportable
Event has occurred and is continuing with respect to any such Plan. No such Plan
or trust created thereunder, or any party in interest, fiduciary, trustee or
administrator thereof, has engaged in a "prohibited transaction" (as such term
is defined in Section 406 of ERISA or Section 4975 of the Internal Revenue Code)
which would subject such Plan or any other Plan of the Borrower, its
Subsidiaries, or any of their respective ERISA Affiliates, any trust created
thereunder, or any party in interest, fiduciary, trustee or administrator
thereof, or any party dealing with any such Plan or any such trust to the tax or
penalty on "prohibited transactions" imposed by Section 502 of ERISA or Section
4975 of the Internal Revenue Code. Neither the Borrower, its Subsidiaries nor
any of their respective
General Communication, Inc. - Form 8-K
Page 199
ERISA Affiliates is a participant in or obliged to make any payment to a
Multiemployer Plan.
(n) Compliance with Regulations G, T, U and X. The Borrower is
not engaged principally or as one of its important activities in the business of
extending credit for the purpose of purchasing or carrying any margin stock
within the meaning of Regulations G, T, U and X of the Board of Governors of the
Federal Reserve System, and no portion of the Loan is to be used for the
"purpose of purchasing or carrying" any "margin stock" as such terms are used in
such Regulations.
(o) Governmental Regulation. Neither the Borrower nor any of its
Subsidiaries is required to obtain any consent, approval, authorization, permit
or license which has not already been obtained from, or effect any filing or
registration which has not already been effected with, any federal, state or
local regulatory authority in connection with the execution and delivery, and
closing of this Agreement or any other Loan Document. Neither the Borrower nor
any of its Subsidiaries is required to obtain any consent, approval,
authorization, permit or license which has not already been obtained from, or
effect any filing or registration which has not already been effected with, any
federal, state or local regulatory authorization in connection with the
performance, in accordance with their respective terms, of this Agreement or any
other Loan Document, the borrowing hereunder and the granting of the Security
Interest, except the filing of UCC-1 financing statements with regard to the
Security Interest in such offices as may be specified in the various opinions of
counsel for the Borrower delivered as required under Section 3.1(a).
(p) Absence of Default. The Borrower and each of its
Subsidiaries are in compliance in all material respects with all of the
provisions of their certificates or articles of incorporation and bylaws or
partnership certificates or agreements, as the case may be, and no event has
occurred or failed to occur, which has not been remedied or waived, the
occurrence or non-occurrence of which constitutes, or which with the passage of
time or giving of notice or both would constitute (i) an Event of Default or
(ii) a material default by the Borrower or any of its Subsidiaries under any
material indenture, agreement or other instrument, including, without limiting
the foregoing, any License, the Management Agreement or any Pole Agreement, or
any judgment, decree or order to which the Borrower or any of its Subsidiaries
is a party or by which the Borrower or any of its Subsidiaries or any of their
respective properties may be bound or affected.
(q) Priority. The Security Interest is a valid and perfected
security interest in the Collateral securing, in accordance with the terms of
the Security Agreement and the Subsidiary Security Agreement, the outstanding
Obligations, and the assets subject to the Security Interest are subject to no
Liens that are prior to, on a parity with or junior to the Security Interest,
other than Permitted Liens, and the Security Agreement and the Subsidiary
Security Agreement are enforceable as security for the outstanding Obligations
in accordance with its terms with respect to the Collateral against the
Borrower, its Subsidiaries, and the Parent Company and all third parties,
subject, as to enforcement of remedies, to the following qualifications: (i)
certain equitable remedies are discretionary and, in particular, may not be
available where damages are considered an adequate remedy at law, (ii)
enforcement may be limited by bankruptcy, insolvency, liquidation,
reorganization, reconstruction and other similar laws affecting enforcement of
creditors' rights generally (insofar as any such
General Communication, Inc. - Form 8-K
Page 200
law relates to the bankruptcy, insolvency or similar event of the Borrower and
its Subsidiaries), and (iii) enforcement as to the Licenses may be limited by
the rules and regulations of the Alaska Public Utilities Commission or other
local laws or by the Licenses themselves or by FCC rules and regulations, as the
case may be, restricting the transfer of such Licenses. Each of the Mortgages
given by the Borrower and its Subsidiaries to the Administrative Agent grants a
valid and perfected interest in the real estate owned by the Borrower and its
Subsidiaries, subject only to the provisions of Section 5.11 hereof. Any
Mortgage secures, in accordance with its terms, the Notes and the other
outstanding Obligations and such interests will be subject to no Liens that are
prior to, on a parity with or junior to the Lien in favor of the Administrative
Agent, as agent for the Managing Agents and the Banks, other than Permitted
Liens, and any Mortgage will be enforceable as security for the outstanding
Obligations in accordance with its terms against the Borrower and its
Subsidiaries and all third parties, subject to the following qualifications: (i)
certain equitable remedies are discretionary and, in particular, may not be
available where damages are considered an adequate remedy at law, (ii)
enforcement may be limited by bankruptcy, insolvency, liquidation,
reorganization, reconstruction and other similar laws affecting enforcement of
creditors' rights generally (insofar as any such law relates to the bankruptcy,
insolvency or similar event of the Borrower or any of its Subsidiaries), and
(iii) the Licenses may require the Administrative Agent to obtain certain
governmental consents or approvals prior to enforcement.
(r) Accuracy and Completeness of Information. All information,
reports, and other papers and data relating to the Borrower and furnished by or
on behalf of the Borrower to the Administrative Agent, the Managing Agents and
the Banks were, at the time furnished, true, complete and correct in all
material respects to the extent necessary to give the Administrative Agent, the
Managing Agents and the Banks true and accurate knowledge of the subject matter
in all material respects. No fact is currently known to the Borrower which is
likely to have a Materially Adverse Effect.
(s) Environmental Matters. Except as is described on Schedule 10
attached hereto:
(i) The Property does not contain, in, on or under,
including, without limitation, the soil and groundwater thereunder, any
Hazardous Materials in violation of Environmental Laws or in amounts that could
give rise to material liability under Environmental Laws.
(ii) The Borrower and its Subsidiaries are in substantial
compliance with all applicable Environmental Laws, and there is no condition
which could interfere with the continued operation of any of the Properties in
substantial compliance with Environmental Laws, or impair the financial
condition of Borrower.
(iii) Neither the Borrower nor any of its Subsidiaries
has received from any governmental authority or any other Person any complaint,
notice of violation, alleged violation, investigation or advisory action or
notice of potential liability regarding matters of environmental protection or
permit compliance under applicable Environmental Laws with regard to the
Properties, and neither the Borrower nor any of its Subsidiaries is aware that
any governmental authority is contemplating delivering to Borrower or any of its
Subsidiaries any such notice. There has been no pending or, to the Borrower's
knowledge, threatened complaint, notice of violation,
General Communication, Inc. - Form 8-K
Page 201
alleged violation, investigation or notice of potential liability under
Environmental Laws with regard to any of the Properties.
(iv) Hazardous Materials have not been generated,
treated, stored, disposed of, at, on or under any of the Property except in
substantial compliance with all Environmental Laws or in a manner that could
give rise to material liability under Environmental Laws nor have any Hazardous
Materials been transported or disposed of from any of the Properties to any
other location except in substantial compliance with all Environmental Laws nor
in a manner that could reasonably be anticipated to give rise to material
liability under Environmental Laws.
(v) Neither the Borrower nor any of its Subsidiaries is a
party to any governmental administrative actions or judicial proceedings pending
under any Environmental Law with respect to any of the Properties, nor are there
any consent decrees or other decrees, consent orders, administrative orders or
other orders, or other administrative or judicial requirements outstanding under
any Environmental Law with respect to any of the Properties.
(vi) There has been no release or threat of release of
Hazardous Materials into the environment at or from any of the Properties, or
arising from or relating to the operations of the Borrower or any of its
Subsidiaries, in violation of Environmental Laws or in amounts that could give
rise to material liability under Environmental Laws.
(t) Investment Company Act; Public Utility Holding Company Act.
Neither the Borrower nor any of its Subsidiaries is required to register under
the provisions of the Investment Company Act of 1940, as amended, and neither
the entering into or performance by the Borrower of this Agreement nor the
issuance of the Notes violates any provision of such Act or requires any
consent, approval or authorization of, or registration with, the Securities and
Exchange Commission or any other governmental or public body or authority
pursuant to any provisions of such Act. Neither the Borrower nor any of its
Subsidiaries is a "public utility holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
(u) Payment of Wages. The Borrower and each of its Subsidiaries
is in compliance in all material respects with the Fair Labor Standards Act, as
amended, and the Borrower and the Subsidiaries have in all material respects
paid all minimum and overtime wages required by law to be paid to their
respective employees.
(v) Securities Laws. The Borrower, each of its Subsidiaries, and
any underwriters, sales agents, representatives or brokers representing or
acting on behalf of the Borrower or any of its Subsidiaries have complied with
all material federal and state securities laws in connection with the offer and
sale of stock or partnership interests in the Borrower or any of its
Subsidiaries.
(w) Agreements with Affiliates and Management Agreements. Except
for the Management Agreement and as otherwise set forth on Schedule 11 attached
hereto, the Borrower does not have (i) any material agreements or binding
arrangements of any kind with any Affiliates, or (ii) any management or
consulting agreements of any kind with any third party.
General Communication, Inc. - Form 8-K
Page 202
Section 4.2 Survival of Representations and Warranties etc. All
representations and warranties made under this Agreement shall be deemed to be
made, and shall be true and correct, at and as of the Agreement Date, the date
of each Advance, and the date of issuance of each Letter of Credit, except to
the extent such representations and warranties (a) relate expressly to an
earlier date, (b) were previously fulfilled in accordance with the terms hereof,
(c) subsequently become inapplicable, or (d) are modified as a result of
activities of the Borrower or changes in circumstances, in any case as permitted
hereunder or as consented to or waived in writing in accordance with Section
11.13. All representations and warranties made under this Agreement shall
survive, and not be waived by, the execution hereof by the Administrative Agent,
the Managing Agents, and the Banks, any investigation or inquiry by the
Administrative Agent, the Managing Agents, and the Banks, or by the making of
any Advance or the issuance of any Letter of Credit under this Agreement.
ARTICLE 5
General Covenants
So long as any of the Obligations is outstanding and unpaid, or the
Borrower has a right to borrow hereunder (whether or not the conditions to
borrowing have been or can be fulfilled), or any Letter of Credit is
outstanding, and unless the Majority Banks (except with respect to Section 5.12)
shall otherwise consent in writing:
Section 5.1 Preservation of Existence and Similar Matters. The
Borrower and each of its Subsidiaries will:
(a) preserve and maintain, or timely obtain and thereafter
preserve and maintain, its existence (except as permitted under Section
7.5(a)(iii) hereof), material rights, franchises, and licenses and its material
privileges used in connection with or relating to the operation of the Systems
in the State of Alaska including, without limiting the foregoing, the Licenses,
the Pole Agreements, and all other Necessary Authorizations (or substitutions
therefor which are reasonably satisfactory to the Majority Banks), and
(b) qualify and remain qualified and authorized to do business
in each jurisdiction in which the character of its properties or the nature of
its businesses requires such qualification or authorization (except as permitted
under Section 7.5(a)(iii) hereof).
Section 5.2 Business: Compliance with Applicable Law. The
Borrower will (a) engage in the business of acting as a holding company owning
its Subsidiaries and of operating the Systems, whether directly or indirectly,
and (b) comply in all material respects with the requirements of all material
Applicable Laws, except where compliance is being contested in good faith by
appropriate proceedings and adequate reserves therefor have been set aside. The
Borrower's Subsidiaries will (a) engage solely in the business of (i) the Cable
Business and the business of owning, operating and maintaining the Systems, and
(ii) leasing fiber capacity on the Systems to third parties; and (b) comply in
all material respects with the requirements of all material
General Communication, Inc. - Form 8-K
Page 203
Applicable Law except where compliance is being contested in good faith by
appropriate proceedings and adequate reserves have been set aside therefor.
Section 5.3 Maintenance of Properties. The Borrower will, and
will cause each of its Subsidiaries to, maintain or cause to be maintained in
the ordinary course of business in good repair, working order and condition
(reasonable wear and tear excepted) all properties used or useful in their
respective businesses (whether owned or held under lease), and from time to time
make or cause to be made all needed and appropriate repairs, renewals,
replacements, additions, betterments and improvements thereto, provided,
however, that the provisions of this Section 5.3 shall not prevent the Borrower
or one of its Subsidiaries from disposing of obsolete equipment and inventory in
the ordinary course of its business, or making dispositions permitted by Section
7.5(a)(ii) hereof.
Section 5.3 Accounting Methods and Financial Records. The
Borrower will maintain, on a consolidated basis with its Subsidiaries, a system
of accounting established and administered in accordance with GAAP consistently
applied, keep adequate records and books of account in which complete entries
will be made in accordance with such accounting principles consistently applied
and reflecting all transactions required to be reflected by such accounting
principles, and keep accurate and complete records of the Collateral. The
Borrower and its Subsidiaries will maintain a calendar year ending on December
31.
Section 5.4 Insurance. The Borrower will, and will cause each of
its Subsidiaries to:
(a) Maintain insurance on the assets and properties comprising
the Systems and on the operations of the Systems including, but not limited to,
public liability, business interruption and fidelity coverage insurance, from
responsible insurance companies in such amounts and against such risks as shall
be reasonably acceptable to the Administrative Agent and thereafter shall
maintain insurance coverage comparable to that in place on the Agreement Date,
taking into account the growth of the Systems after the Agreement Date.
(b) Keep the Collateral insured by insurers on terms and in a
manner reasonably acceptable to the Administrative Agent against loss or damage
by fire, theft, burglary, pilferage, loss in transit, explosions and hazards
insured against by extended coverage, in amounts reasonably satisfactory to the
Majority Banks, all premiums thereon to be paid by the Borrower and its
Subsidiaries.
(c) Require that each insurance policy on the assets and
properties comprising the Systems and on the operations of the Systems name the
Administrative Agent, as agent for the Managing Agents and the Banks, as
additional insured or named loss payee, as appropriate, to the extent of the
Obligations, and provide for at least thirty (30) days' prior written notice to
the Administrative Agent of any default under, termination of or proposed
cancellation or nonrenewal of, such policy. Subject to Section 3.2 hereof, in
the event of a casualty covered by the Borrower's or any of its Subsidiaries'
insurance maintained in accordance with this Section 5.5, the Borrower will be
entitled, to the extent otherwise permitted hereunder, to borrow a Base Rate
Advance in an amount necessary to replace or repair the damages caused by such
casualty. Proceeds of insurance paid to the Administrative Agent shall (i) be
General Communication, Inc. - Form 8-K
Page 204
applied by the Administrative Agent to repay the Advance made to the Borrower
pursuant to the immediately preceding sentence as set forth in Section 2.9(c) or
Section 8.2 hereof, as appropriate, without penalty or premium and (ii)
thereafter be applied by the Administrative Agent as provided in Section 2.9(c).
Any balance thereof remaining after payment in full of the Obligations shall be
paid to the Borrower or as otherwise required by law.
Section 5.6 Payment of Taxes and Claims. The Borrower will, and
will cause each of its Subsidiaries to, pay and discharge all taxes, assessments
and governmental charges or levies imposed upon it or its income or profits or
upon any properties belonging to it prior to the date on which penalties attach
thereto, and all lawful claims for labor, materials and supplies which, if
unpaid, might become a Lien or charge upon any of its properties; except that no
such tax, assessment, charge, levy or claim need be paid which is being
contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on the appropriate books, but only so long as
such tax, assessment, charge, levy or claim does not become a Lien or charge
other than a Permitted Lien and no foreclosure, distraint, sale or similar
proceedings shall have been commenced. The Borrower shall, and shall cause each
of its Subsidiaries to, timely file all information returns required by federal,
state or local tax authorities.
Section 5.7 Visits and Inspections. The Borrower will, and will
cause each of its Subsidiaries to, permit representatives of the Administrative
Agent, the Managing Agents, and each of the Banks upon two (2) Business Days'
prior notice, unless a Default has occurred, in which case no notice will be
required, to (a) visit and inspect its properties during normal business hours,
(b) inspect and make extracts from and copies of its books and records, and (c)
discuss with its principal officers and auditors and those of the Manager its
businesses, assets, liabilities, financial positions, results of operations and
business prospects pertaining to the Systems.
Section 5.8 Payment of Indebtedness. Subject to Section 5.6
hereof and provisions herein or in any other Loan Document regarding
subordination, the Borrower will, and will cause each of its Subsidiaries to,
pay any and all of its Indebtedness when and as it becomes due, other than
amounts duly disputed in good faith.
Section 5.9 Use of Proceeds. The Borrower will use the aggregate
proceeds of the initial Advance of the Loans as set forth in the Use of Proceeds
Letter, and will use subsequent Advances under the Loans to fund working
capital, for Capital Expenditures, to make Restricted Payments to the extent
permitted under Section 7.7 hereof, to pay expenses incurred by the Borrower
with respect to the consummation of this Agreement and related transactions
thereto, and for other general corporate purposes.
Section 5.10 Management. The Borrower and its Subsidiaries will
be managed by the Manager under the terms of the Management Agreement.
Section 5.11 Real Estate. The Borrower will, and will cause each
of its Subsidiaries to, grant a Mortgage to the Administrative Agent, as agent
for the Managing Agents and the Banks, in substantially the form of the Mortgage
delivered on the Agreement Date, covering any parcel of real estate acquired by
the Borrower
General Communication, Inc. - Form 8-K
Page 205
or any of its Subsidiaries with respect to the Systems after the Agreement Date
having a fair market value in excess of $250,000, and collaterally assign, to
the extent permitted therein, any leases entered into by the Borrower or any of
its Subsidiaries as lessor with respect to such real estate. The Borrower will,
and will cause each of its Subsidiaries to, deliver to the Administrative Agent,
the Managing Agents, and each of the Banks, all documentation, including one or
more opinions of counsel and policies of title insurance, which in the opinion
of the Administrative Agent is appropriate with each such grant or assignment.
Section 5.12 Indemnity. The Borrower for itself and on behalf of
each of its Subsidiaries, will indemnify and hold harmless the Indemnified
Parties from and against any and all claims, liabilities, losses, damages,
actions, and demands by any party (other than with respect to any claims,
actions or demands made by any other Indemnified Party or any liabilities,
losses or damages caused thereby) against any Indemnified Party resulting from
any breach or alleged breach by the Borrower or any of its Subsidiaries of any
representation or warranty made hereunder, or otherwise arising out of (i) the
Commitment or the making or administration of the Loans, (ii) allegations of any
participation by the Indemnified Parties, or any of them in the affairs of the
Borrower or any of its Subsidiaries or that the Indemnified Parties, or any of
them has any joint liability with the Borrower or any of its Subsidiaries for
any reason, or (iii) any claim against the Indemnified Parties, or any of them
by any Shareholder or other investor in or lender to the Borrower or any of its
Subsidiaries for any reason whatsoever; unless, with respect to any of the
above, the party seeking indemnification is finally judicially determined to
have acted or failed to act with gross negligence or wilful misconduct.
Section 5.13 Payment of Wages. The Borrower and each of its
Subsidiaries will at all times comply in all material respects with the
requirements of the Fair Labor Standards Act, as amended, including, without
limitation, the provisions of such act relating to the payment of minimum and
overtime wages as the same may become due from time to time.
Section 5.14 Interest Rate Hedging.Rate Hedging.
(a) Within six months from the Agreement Date, the Borrower
shall have entered into one or more Interest Hedge Agreements which fix or place
a limit on the Borrower's interest obligations at interest rates acceptable to
the Administrative Agent with respect to the Loans on an aggregate of not less
than fifty percent (50%) of the principal amount of the Loans then outstanding,
such Interest Hedge Agreements to provide interest rate protection for a period
of at least two (2) years from the date of the Interest Hedge Agreement.
(b) All obligations of the Borrower to the Administrative Agent,
the Managing Agents, the Banks, or any of them, or any affiliate of any of them,
pursuant to any Interest Hedge Agreement, shall be deemed to be part of the
Obligations.
Section 5.15 ERISA. The Borrower shall, and shall cause each of
its Subsidiaries to, at all times make, or cause to be made, prompt payment of
contributions required to meet the minimum funding standards set forth in ERISA
with respect to their and their respective ERISA Affiliates' Plans.
General Communication, Inc. - Form 8-K
Page 206
Section 5.16 Further Assurances. The Borrower will promptly
cure, or cause to be cured, defects in the creation and issuance of the Notes
and the execution and delivery of the Loan Documents (including this Agreement),
resulting from any act or failure to act by the Borrower, any of its
Subsidiaries, or any of the employees or officers thereof. The Borrower and each
of its Subsidiaries at their expense will promptly execute and deliver to the
Administrative Agent and the Banks, or cause to be executed and delivered to the
Administrative Agent and the Banks, all such other and further documents,
agreements, and instruments in compliance with or accomplishment of the
covenants and agreements of the Borrower in the Loan Documents, including this
Agreement, or to correct any omissions in the Loan Documents, or to obtain any
consents which are necessary in connection with or in accomplishment of the
covenants and agreements of the Borrower and each of its Subsidiaries under the
Loan Documents, all as may be necessary or appropriate in connection therewith
as may be reasonably requested.
ARTICLE 6
Information Covenants
So long as any of the Obligations under the Loan Documents is
outstanding and unpaid or the Borrower has a right to borrow hereunder (whether
or not the conditions to borrowing have been or can be fulfilled), or any Letter
of Credit is outstanding, and unless the Majority Banks shall otherwise consent
in writing, the Borrower will furnish or cause to be furnished to the
Administrative Agent at the Administrative Agent's Office, to each Managing
Agent and to each Bank:
Section 6.1 Quarterly Financial Statements and Information.
Within sixty (60) days after the last day of each quarter of each calendar year
(other than the calendar quarter ending on December 31), the balance sheets of
(i) the Parent Company on a consolidated basis with the Borrower and the
Borrower's Subsidiaries and (ii) of the Borrower and the Borrower's Subsidiaries
on a consolidated basis, as at the end of such quarter and the related
statements of income and retained earnings and related statements of cash flows
of (i) the Parent Company on a consolidated basis with the Borrower and the
Borrower's Subsidiaries and (ii) of the Borrower and its Subsidiaries on a
consolidated basis, for such quarter and for the elapsed portion of the year
ended with the last day of such quarter, all of which shall be certified by the
chief financial officer or chief accounting officer of the Parent Company, to
be, in his opinion, complete and correct in all material respects and to present
fairly, in accordance with GAAP, the financial position of (i) the Parent
Company on a consolidated basis with the Borrower and the Borrower's
Subsidiaries and (ii) of the Borrower and its Subsidiaries on a consolidated
basis, as at the end of such period and the results of operations for such
period, and for the elapsed portion of the year ended with the last day of such
period, subject only to normal year-end adjustments.
Section 6.2 Annual Financial Statements and Information;
Certificate of No Default. Within one hundred twenty (120) days after the end of
each calendar year, the audited balance sheets of (i) the Parent Company, on a
consolidated basis with the Borrower and the Borrower's Subsidiaries and (ii) of
the Borrower and the Borrower's Subsidiaries on a consolidated basis, as at the
end of such calendar year and the related audited statement of income and
retained earnings or deficit and
General Communication, Inc. - Form 8-K
Page 207
related statements of cash flows of (i) the Parent Company, the Borrower and the
Borrower's Subsidiaries on a consolidated basis and (ii) of the Borrower and its
Subsidiaries on a consolidated basis, for such calendar year, setting forth in
comparative form the figures as at the end of and for the previous calendar year
and certified by independent certified public accountants of national recognized
standing, whose opinion shall be in scope and substance reasonably satisfactory
to the Administrative Agent and the Majority Banks and include a statement
certifying that no Default or Event of Default was detected during the
examination of the Parent Company, the Borrower and the Borrower's Subsidiaries,
on a consolidated basis, and that such accountants have authorized the Parent
Company to deliver such financial statements and opinion thereon to the
Administrative Agent, the Managing Agents and each of the Banks pursuant to this
Agreement.
Section 6.3 Performance Certificates. At the time the financial
statements are furnished pursuant to Sections 6.1 and 6.2, commencing with
respect to the quarter ending December 31, 1996, a certificate of an Authorized
Signatory:
(a) setting forth as at the end of such quarterly period or
calendar year, as the case may be, the arithmetical calculations required to
establish (i) the Applicable Margin, and (ii) whether or not the Borrower was in
compliance with the requirements of Sections 7.8, 7.9, 7.10, 7.11 and 7.17; and
(b) stating that, to the best of his or her knowledge, no
Default or Event of Default has occurred as at the end of such quarterly period
or year, as the case may be, or, if a Default or Event of Default has occurred,
disclosing each such Default or Event of Default and its nature, when it
occurred, whether it is continuing and the steps being taken by Borrower with
respect to such Default or Event of Default.
Section 6.4 Monthly Reports. Within forty-five (45) days from
the last day of each month, (a) a monthly subscriber report of the Borrower and
its Subsidiaries, in substantially the form attached hereto as Exhibit P, which
report shall include, among other things, a reasonable estimate of the number of
homes passed, actual basic subscribers, actual pay subscribers, and actual
disconnecting subscribers for the Borrower for such month, and (b) a detailed
profit and loss statement for such month and for the year-to-date, as compared
with the budget for such year. Each such item shall be complete and correct in
all material respects except for audit and year-end adjustments.
Section 6.5 Copies of Other Reports.ther Reports
(a) Promptly upon receipt thereof, copies of all reports, if
any, submitted to the Borrower by the Borrower's independent public accountants
regarding the Borrower, including, without limitation, any management report
prepared in connection with the annual audit referred to in Section 6.2.
(b) Promptly after its preparation and in no event later than
January 31 of each year, a copy of the annual budget for such calendar year,
including the budget for Capital Expenditures, for the Borrower on a
consolidated basis with its Subsidiaries.
General Communication, Inc. - Form 8-K
Page 208
(c) Promptly upon request therefor by the Administrative Agent,
any Managing Agent, or any Bank, copies of any material notices given to the
Borrower by the Manager under the Management Agreement.
(d) Promptly upon receipt thereof, copies of any material notice
or report regarding any License from the grantor of such License or regarding
the Systems or any License from the FCC.
(e) From time to time and promptly upon each request, such data,
certificates, reports, statements, opinions of counsel, financial projections,
documents or further information regarding the Collateral or the business,
assets, liabilities, financial position, or results of operations of the
Borrower or any of its Subsidiaries, as may be reasonably requested by the
Administrative Agent, any Managing Agent, or any Bank (provided that the
Borrower will not be required to produce separate financial statements for any
of its Subsidiaries).
(f) Promptly upon the filing thereof, copies of all material
reports, proxies, forms or other documents required to be filed or submitted by
the Parent Company to the Securities and Exchange Commission or other federal or
state securities law enforcement agency or commission.
Section 6.6 Notice of Litigation and Other Matters. Prompt
notice (and in any event, notice within three (3) Business Days) of the
following events after the Borrower has received notice thereof or otherwise
becomes aware of:
(i) the commencement of all material proceedings and
investigations by or before any governmental body and all material actions and
proceedings in any court or before any arbitrator (A) against, or (B) in any
other way relating materially adversely and directly to, the Borrower, Parent
Company, or any of the Subsidiaries of the Borrower, or the Manager or any of
their respective properties, assets or businesses or any License;
(ii) any material adverse change with respect to the
business, assets, liabilities, financial position, results of operations or
business prospects of the Borrower, or Parent Company, or any of the
Subsidiaries of the Borrower other than changes in the ordinary course of
business which have not had and are not likely to have a Materially Adverse
Effect;
(iii) any material amendment or material modification to
the budget submitted under Section 6.5(b) hereof for the operation of the
Systems;
(iv) any Default or Event of Default or the occurrence or
non-occurrence of any event (x) which constitutes, or which with the passage of
time or giving of notice or both would constitute a default by the Borrower or
any of its Subsidiaries under any material agreement other than this Agreement
to which the Borrower or any of its Subsidiaries is party or by which its
properties may be bound, and (y) which would be likely to have a Materially
Adverse Effect, giving in each case the details thereof and specifying the
action proposed to be taken with respect thereto;
General Communication, Inc. - Form 8-K
Page 209
(v) the occurrence of any Reportable Event or a
"prohibited transaction" (as defined in Section 4.1(m) hereof) with respect to
any Plan of the Borrower or any of its Subsidiaries or any of their respective
ERISA Affiliates, or the institution or threatened institution by the Pension
Benefit Guaranty Corporation or any successor thereto of proceedings under ERISA
to terminate or partially terminate such Plan, or the termination or partial
termination of any such Plan, or the commencement or threatened commencement of
any litigation regarding any such Plan or naming it or the trustee of any such
Plan with respect to such Plan; and
(vi) the occurrence of any event subsequent to the
Agreement Date which, if such event had occurred prior to the Agreement Date,
would have constituted an exception to the representation and warranty in
Section 4.1(m) of this Agreement.
ARTICLE 7
Negative Covenants
So long as any of the Obligations under the Loan Documents is
outstanding and unpaid or the Borrower has a right to borrow hereunder (whether
or not the conditions to borrowing have been or can be fulfilled), or any Letter
of Credit is outstanding, and unless the Majority Banks shall otherwise consent
in writing:
Section 7.1 Indebtedness of the Borrower. The Borrower shall
not, and shall cause each of its Subsidiaries not to, create, assume, incur or
otherwise become or remain obligated in respect of, or permit to be outstanding,
any Indebtedness except:
(a) Indebtedness under this Agreement, the Notes and the other
Loan Documents including, without limitation, reimbursement obligations with
respect to Letters of Credit;
(b) Accounts payable, subscriber deposits, accrued expenses,
customer advance payments and other current liabilities (other than for money
borrowed) incurred in the ordinary course of business;
(c) An amount not to exceed $4,000,000 in the aggregate for the
Borrower on a consolidated basis with its Subsidiaries at any time consisting of
(i) Capitalized Lease Obligations and Indebtedness for Money Borrowed (other
than the Obligations) (whether or not secured) outstanding as of the Agreement
Date listed on Schedule 12 attached hereto, and (ii) other Capitalized Lease
Obligations and Indebtedness for Borrowed Money (whether or not secured);
(d) Current and deferred management fees and other expenses,
together with any interest thereon, due pursuant to the terms of the Management
Agreement and subject to the Subordination and Assignment of Management
Agreement;
(e) Indebtedness permitted pursuant to Section 7.2(a) or Section
7.6 hereof;
General Communication, Inc. - Form 8-K
Page 210
(f) Indebtedness incurred in order to prevent the occurrence of
a Default under Section 8.1(d) hereof as permitted thereby, subject to the terms
and conditions of a subordination agreement in the form attached hereto as
Exhibit Q;
(g) Indebtedness under Interest Hedge Agreements entered into in
satisfaction of the Borrower's obligations under Section 5.14(a) hereof; and
(h) Investments permitted hereunder that also constitute
Indebtedness.
Section 7.2 Investments. The Borrower and its Subsidiaries shall
not make or otherwise acquire for a consideration in excess of $100,000 any
Investments, except that (a) the Borrower and its Subsidiaries may make
Investments in and loans to Subsidiaries of the Borrower; (b) the Borrower and
its Subsidiaries may purchase or otherwise acquire and own (i) marketable,
direct obligations of the United States of America maturing within three hundred
sixty-five (365) days of the date of purchase, (ii) commercial paper issued by
corporations, each of which shall have a consolidated net worth of at least $250
million and each of which conducts a substantial part of its business in the
United States of America, maturing within one hundred eighty (180) days from the
date of the original issue thereof, and rated "P-1" or better by Moody's
Investor's Service, (iii) repurchase agreements in such amounts and with such
financial institutions having a rating of A or better from Moody's Investor's
Service as the Borrower may select from time to time following consultation with
the Administrative Agent, and (iv) certificates of deposit maturing within three
hundred sixty-five (365) days of the date of purchase which are issued by any
Bank or by a United States national or state bank having capital, surplus and
undivided profits totaling more than $100 million, and having a rating of A or
better from Moody's Investors Service; and (c) as permitted by Section 7.5(b)
hereof.
Section 7.3 Limitation on Liens. The Borrower shall not, and
shall cause each of its Subsidiaries not to, create, assume, incur or permit to
exist or to be created, assumed, incurred or permitted to exist, directly or
indirectly, any Lien on any of its properties or assets, whether now owned or
hereafter acquired, except for Permitted Liens.
Section 7.4 Amendment and Waiver. The Borrower shall not, and
shall cause its Subsidiaries not to, without the prior written consent of the
Majority Banks, except in connection with the issuance of equity securities to
effect a cure of an Event of Default pursuant to Section 8.1(d) hereof, enter
into any material amendment of, or agree to or accept any material waiver of any
(a) of the material provisions of its articles or certificate of incorporation,
partnership agreement, or similar organizational documents or (b) any material
provision of (i) its bylaws, (ii) any License or Pole Agreement other than in
the ordinary course of business, or (iii) the Management Agreement.
Section 7.5 Liquidation; Disposition or Acquisition of Assets.
The Borrower shall not, and shall cause each of its Subsidiaries not to, at any
time:
(a) (i) liquidate or dissolve itself (or suffer any liquidation
or dissolution) or otherwise wind up, or (ii) sell, lease, abandon, transfer or
otherwise dispose of (other than obsolete equipment and inventory) any assets or
business (including the disposition of stock or other ownership interests, and
including the sale with or
General Communication, Inc. - Form 8-K
Page 211
without recourse, and the discounting or other sale for less than face value, of
any notes or accounts receivable) in excess of $4,000,000 in the aggregate
during the term of this Agreement (except that the Borrower and its Subsidiaries
may transfer assets and businesses amongst themselves), or (iii) enter into any
merger or consolidation (except among the Borrower and one or more of its
Subsidiaries provided that Borrower is the surviving corporation or among two or
more of the Subsidiaries of the Borrower);
(b) acquire capital stock, partnership interests or assets;
provided, that the foregoing notwithstanding, (A) the Borrower and its
Subsidiaries may make Investments as permitted under Section 7.2 hereof and may
transfer assets and businesses amongst themselves, and (B) the Borrower shall be
entitled to (i) make Capital Expenditures in the ordinary course of the
Borrower's business permitted by Section 7.17 below, (ii) make real estate
purchases permitted by Section 7.13 (except that Borrower and its wholly-owned
Subsidiaries may transfer assets and businesses amongst themselves), and (iii)
make other Acquisitions having a purchase price not in excess of $4,000,000 in
the aggregate during the term of this Agreement;
(c) create any new Subsidiary (other than the formation of a
Subsidiary in connection with an Acquisition permitted under Section
7.5(b)(iii), above);
(d) as to the Borrower, issue any additional shares of common
stock unless such shares are issued to the Parent Company and simultaneously
pledged by the holder thereof to the Collateral Agent pursuant to the Parent's
Pledge Agreement.
Section 7.6 Limitation on Guaranties. The Borrower shall not,
and shall cause each of its Subsidiaries not to, at any time Guaranty, or
assume, be obligated with respect to, or permit to be outstanding any Guaranty
of, any obligation of any other Person (other than the Borrower and such
Subsidiaries) other than (a) under any Loan Document or as permitted under
Section 7.1 hereof, (b) obligations under agreements to indemnify Persons who
have issued bid or performance bonds or letters or credit issued in lieu of such
bonds in the ordinary course of business of the Borrower securing performance by
the Borrower of activities otherwise permissible hereunder, and (c) a guaranty
by endorsement of negotiable instruments for collection in the ordinary course
of business.
Section 7.7 Restricted Payments and Purchases. The Borrower
shall not, and shall cause each of its Subsidiaries not to, directly or
indirectly declare or make any Restricted Payment or Restricted Purchase, except
that so long as no Default hereunder then exists or would result therefrom, the
Borrower may make (a) payments of accrued and unpaid management fees, expenses
and accrued interest thereon, as of the Agreement Date totalling no more than
$2,000,000, (b) payment of previously deferred management fees, expenses and
accrued interest thereon, otherwise permitted under subsection (c) below, and
(c) current payments of management fees and expenses payable to the Manager
under the Management Agreement, provided that the total management fees paid in
any period do not exceed the following amounts:
General Communication, Inc. - Form 8-K
Page 212
Applicable Period Total Management Fees
----------------- ---------------------
Agreement Date through $167,000
December 31, 1996
January 1, 1997 through $958,500
December 31, 1997
January 1, 1998 through $708,500
December 31, 1998
January 1, 1999 through $417,000
October 31, 1999
November 1 through $500,000
October 31 of each year thereafter
Section 7.8 Leverage Ratio. As of the end of any calendar
quarter, the Borrower shall not permit the Leverage Ratio for such quarter to
exceed the ratio for each quarter ended during the applicable period set forth
below:
Applicable Period Ratio
----------------- -----
Agreement Date through March 31, 1997 6.60:1
April 1, 1997 through December 31, 1997 6.50:1
January 1, 1998 through December 31, 1998 6.25:1
January 1, 1999 through June 30, 1999 6.00:1
July 1, 1999 through December 31, 1999 5.50:1
January 1, 2000 through June 30, 2000 5.25:1
July 1, 2000 through December 31, 2000 4.75:1
January 1, 2001 through June 30, 2001 4.25:1
July 1, 2001 and thereafter 4.00:1
Section 7.9 Interest Coverage Ratio. As of the end of any
calendar quarter, the Borrower shall not permit the ratio of (i) Operating Cash
Flow of Borrower for such quarter, to (ii) Total Interest Expense for such
quarter to be less than: (a) from the Agreement Date through June 30, 1997,
1.50:1, (b) from July 1, 1997 through December 31, 1997, 1.75:1, and (c) from
January 1, 1998 and each calendar quarter ending thereafter, 2.00:1.
Section 7.10 Annualized Operating Cash Flow to Pro Forma Debt
Service Ratio. As of the end of any calendar quarter, the Borrower shall not
permit the ratio of (i) Annualized Operating Cash Flow of Borrower for such
quarter, to (ii) Pro Forma Debt Service of Borrower to be less than 1.10:1.
General Communication, Inc. - Form 8-K
Page 213
Section 7.11 Fixed Charges Coverage Ratio. From January 1, 1999
and thereafter the Borrower shall not, for any calendar quarter, permit the
ratio of (x) the sum of (a) Operating Cash Flow of Borrower for such quarter,
plus (b) cash on hand at the beginning of such quarter, to (y) Fixed Charges of
Borrower for such quarter, to be less than 1.00:1.
Section 7.12 Affiliate Transactions. The Borrower shall not, and
shall cause its Subsidiaries not to, at any time engage in any transaction with
an Affiliate (other than transactions between or among the Borrower and its
Subsidiaries), nor make an assignment or other transfer of any of its assets to
any Affiliate (other than between or among the Borrower and its Subsidiaries),
on terms less advantageous than would be the case if such transaction had been
effected with a non-Affiliate, except with respect to investments and loans
permitted under Section 7.2(a) and except as provided in the Management
Agreement with respect to the Borrower's relationship with the Manager. In
addition, the Borrower shall receive the benefit of any discounts, rebates or
special payment terms for pay television programming available to any Affiliate
which such Affiliate is permitted to pass through to the Borrower, but which are
not available to the Borrower from a non-Affiliate.
Section 7.13 Real Estate. Except for the property described on
Schedule 5 hereto, the Borrower and its Subsidiaries shall not, in the
aggregate, purchase or become obligated to purchase real estate other than
purchases of small parcels of real estate (which shall be acquired subject to a
Mortgage) in the ordinary course of business having a purchase price in an
amount not to exceed, for any single such parcel, $500,000 or, in the aggregate,
$2,000,000.
Section 7.14 Transfer of Interests. The Borrower shall not, and
shall cause its Subsidiaries not to, make or permit any transfer, assignment,
distribution, mortgage, pledge or gift of any shares of capital stock, limited
partner interest or any general partner interest or any other securities in the
Borrower or any of its Subsidiaries, or transfer the ultimate control of
Borrower or any of its Subsidiaries other than (i) in connection with mergers
permitted under Section 7.5(a)(iii), (ii) by way of transfer of ownership of one
or more of the Borrower's Subsidiaries to another wholly-owned Subsidiary of the
Borrower, and (iii) to the Administrative Agent on behalf of the Banks.
Section 7.15 ERISA Liabilities. The Borrower shall not, and
shall cause each of its Subsidiaries not to, fail to meet all of the applicable
minimum funding requirements of ERISA and the Code, without regard to any
waivers thereof, and, to the extent that the assets of any of their respective
Plans would be less than an amount sufficient to provide all accrued benefits
payable under such Plans, shall make the maximum deductible contributions
allowable under the Code. Neither the Borrower nor any of its Subsidiaries shall
become a participant in any Multiemployer Plan.
Section 7.16 Consolidated Tax Returns. The Borrower will not
file, or consent to the filing of, any consolidated income tax return with any
person other than a Subsidiary or the Parent Company or any other corporation
controlled by the Borrower.
General Communication, Inc. - Form 8-K
Page 214
Section 7.17 Capital Expenditures. The Borrower shall not make
Capital Expenditures in excess of the following amounts; provided, however that
unused amounts may be carried forward:
Applicable Period Maximum Capital Expenditures
----------------- ----------------------------
Agreement Date through $31,000,000
December 31, 1997
January 1, 1998 through $29,000,000
December 31, 1998
January 1, 1999 and thereafter [Not Tested]
ARTICLE 8
Default
Section 8.1 Events of Default. Each of the following shall
constitute an Event of Default, whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment or order of any court or any order, rule or regulation
of any governmental or non-governmental body:
(a) Any material representation or warranty made or deemed made
under this Agreement shall prove incorrect or misleading in any material respect
when made or deemed made;
(b) The Borrower shall default (i) in the payment of any
interest under any of the Notes, or any reimbursement obligation with respect to
any Letter of Credit, or any fees due hereunder or under any other Loan
Document, and such Default shall not be cured by payment of such overdue amounts
in full within five (5) days from the date such payment became due; or (ii) in
the payment of any principal under any of the Notes when due;
(c) The Borrower shall default in the performance or observance
of any agreement or covenant contained in Sections 7.7, 7.9, 7.10, 7.11, or 7.17
hereof;
(d) The Borrower shall default in the performance or observance
of the agreement or covenant contained in Section 7.8 hereof; provided, that if
the Borrower, within fifteen (15) days from the date the financial statements
are delivered to the Administrative Agent pursuant to Sections 6.1 and 6.2
hereof, by using cash on hand or the proceeds of subordinated Indebtedness for
Money Borrowed (provided that such Indebtedness for Money Borrowed is
subordinated to the Obligations pursuant to the terms of a subordination
agreement in the form attached hereto as Exhibit Q) or the sale of additional
equity securities of the Borrower, reduces the amount of Total Debt then
outstanding as of the relevant calculation date to an amount that would not
cause a Default under Section 7.8, no Default or Event of Default shall be
deemed to have occurred; provided further, the Borrower may use the right to
General Communication, Inc. - Form 8-K
Page 215
prevent a Default under Section 7.8 set forth in the preceding clause on not
more than two (2) occasions in non-consecutive quarters during the term of this
Agreement;
(e) The Borrower shall default in the performance or observance
of any other agreement or covenant contained in this Agreement not specifically
referred to elsewhere in this Section 8.1, and such default shall not be cured
to the Majority Banks' satisfaction evidenced in writing within a period of
thirty (30) days from the later of (i) the date of occurrence of such default,
or (ii) the date that the Borrower discovered such default;
(f) There shall occur any default in the performance or
observance of any agreement or covenant or breach of any representation or
warranty contained in any of the Loan Documents (other than this Agreement)
which shall not be cured to the Majority Banks' satisfaction evidenced in
writing within the lesser of (i) the applicable cure period, if any, provided
for in such Loan Document and (ii) a period of thirty (30) days from the later
of (a) the date of occurrence of such default, or (b) the date that the Borrower
discovered such default; or the Borrower or any of its Subsidiaries shall in any
way challenge, or any proceedings shall in any way be brought to challenge (and,
in the case of a proceeding brought by someone other than the Borrower or any of
its Subsidiaries shall continue unstayed for a period of forty-five (45) days),
the prior and perfected status of the Security Interest with respect to the
Collateral or the validity or enforceability of the Security Interest, or of any
other Loan Document which provides Collateral for the Obligations;
(g) There shall be any Lien, collateral assignment, security
interest, chattel mortgage or any other encumbrance on the equity or partnership
interests, as the case may be, of the Borrower or any of its Subsidiaries, other
than Liens of the type described in subparagraphs (a), (e) and (k) of the
definition of Permitted Liens;
(h) There shall be filed an involuntary petition under Title 11
of the United States Code, as now constituted or hereafter amended, in respect
of the Parent Company, Borrower or any of its Subsidiaries which shall remain
uncontroverted for a period of forty-five (45) consecutive days; or there shall
be entered a decree or order by a court having jurisdiction in the premises
constituting an order for relief in respect of the Parent Company, Borrower or
any of its Subsidiaries under Title 11 of the United States Code, as now
constituted or hereafter amended, or any other applicable Federal or state
bankruptcy law or other similar law, or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or similar official of the Parent
Company, Borrower or any of its Subsidiaries or of any substantial part of their
respective properties, or ordering the winding-up or liquidation of the affairs
of the Parent Company, Borrower or any of its Subsidiaries and any such decree
or order shall continue unstayed and in effect for a period of forty-five (45)
consecutive days;
(i) The Parent Company, Borrower or any of its Subsidiaries
shall file a petition, answer or consent seeking relief under Title 11 of the
United States Code, as now constituted or hereafter amended, or any other
applicable Federal or state bankruptcy law or other similar law, or the Parent
Company, Borrower or any of its Subsidiaries shall consent to the institution of
proceedings thereunder or to the filing of any such petition or to the
appointment or taking of possession of a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the
General Communication, Inc. - Form 8-K
Page 216
Parent Company, Borrower or any of its Subsidiaries or of any substantial part
of their respective properties, or the Parent Company, Borrower or any of its
Subsidiaries shall fail generally to pay their respective debts as they become
due, or the Parent Company, Borrower or any of its Subsidiaries shall take any
action in furtherance of any such action;
(j) A final judgment shall be entered by any court against the
Borrower or any of its Subsidiaries for the payment of money which exceeds
$500,000, or a warrant of attachment or execution or similar process shall be
issued or levied against property of the Borrower or any of its Subsidiaries
which, together with all other such property of the Borrower or any of its
Subsidiaries subject to other such process, exceeds in value $500,000 in the
aggregate, and if, within thirty (30) days after the entry, issue or levy
thereof, such judgment, warrant or process shall not have been paid or
discharged or stayed pending appeal, or if, after the expiration of any such
stay, such judgment, warrant or process shall not have been paid or discharged;
(k) There shall be at any time any "accumulated funding
deficiency," as defined in ERISA or in Section 412 of the Internal Revenue Code,
with respect to any Plan maintained by the Borrower, any of its Subsidiaries or
any of their respective ERISA Affiliates, or to which the Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates has any liabilities, or
any trust created thereunder; or a trustee shall be appointed by a United States
District Court to administer any such Plan; or the Pension Benefit Guaranty
Corporation or any successor thereto shall institute proceedings to terminate
any such Plan; or the Borrower, any of its Subsidiaries or any of their
respective ERISA Affiliates shall incur any material liability to the Pension
Benefit Guaranty Corporation or any successor thereto in connection with any
such Plan; or any Plan or trust created under any Plan of the Borrower, any of
its Subsidiaries or any of their respective ERISA Affiliates shall engage in a
"prohibited transaction" (as defined in Section 4.1(m) hereof) which would
subject such Plan or any other Plan of the Borrower, any of its Subsidiaries or
any of their respective ERISA Affiliates, any trust created thereunder, or any
trustee or administrator thereof, or any party dealing with any such Plan or
trust to the tax or penalty on "prohibited transactions" imposed by Section 502
of ERISA or Section 4975 of the Internal Revenue Code; or the Borrower, any of
its Subsidiaries or any of their respective ERISA Affiliates shall enter into or
become obligated to contribute to a Multiemployer Plan;
(l) Any event shall occur which has a Materially Adverse Effect;
(m) The Manager shall for any reason cease providing management
to the Borrower and its Subsidiaries, there shall be a change of more than
twenty percent (20%) of the ownership of the Manager (other than changes in the
partnership percentages of the present partners), or the Management Agreement
shall cease to be in full force and effect or there shall be a material default
thereunder which default shall continue unremedied for a period of thirty (30)
days, or there shall occur a Change in Control;
(n) There shall occur any default under any material mortgage,
deed to secure debt, note, loan agreement, indenture, or other instrument of the
Borrower or any of its Subsidiaries evidencing Indebtedness for Money Borrowed,
which default is
General Communication, Inc. - Form 8-K
Page 217
not cured within the applicable cure period and which results in acceleration
thereunder;
(o) Any License (other than a License for a portion of the
Systems having fewer than 1,500 basic subscribers or any License identified on
Schedule 2 hereto as not being a material license) shall be revoked and such
revocation shall not be cured, waived or stayed, or there shall occur a material
default under any such License which shall not have been cured or waived within
thirty (30) days of the occurrence thereof, or any proceedings shall in any way
shall be brought to challenge (and shall continue uncontested for a period of
thirty (30) days), the validity or enforceability of any such License, or any
such License shall expire due to termination, nonrenewal or for any other
reason; or
(p) There shall be any material change in the respective
percentage ownership interests of Subsidiaries held by the Borrower except in
connection with a sale of equity securities by the Borrower, and except that the
Borrower may transfer ownership of one or more of its wholly-owned Subsidiaries
to another wholly-owned Subsidiary of the Borrower.
Section 8.2 Remedies. If an Event of Default shall have occurred
and until such Event of Default shall have been waived in writing in accordance
with Section 11.13 hereof (or, if prior to acceleration or the exercise of any
other remedies hereunder, until such Event of Default shall have been cured):
(a) With the exception of an Event of Default specified in
Section 8.1(h) or 8.1(i), the Administrative Agent, at the request of the
Majority Banks, shall (i) terminate the Commitment, and (ii) declare the
principal of and interest on the Loans and the Notes and all other amounts owed
under this Agreement at such time by the Borrower (which shall not include fees
due under Section 2.4 hereof which have not accrued as of the date of such
declaration) to be forthwith due and payable without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived,
anything in this Agreement or in the Notes to the contrary notwithstanding, and
the Commitment shall forthwith terminate and all amounts hereunder shall then be
immediately due and payable.
(b) Upon the occurrence of an Event of Default specified in
Section 8.1(h) or Section 8.1(i), the principal of and interest on the Loans and
the Notes and all other amounts owed under this Loan Agreement at such time by
the Borrower (which shall not include fees due under Section 2.4 hereof which
have not accrued as of the date of such declaration) shall thereupon and
concurrently therewith automatically become due and payable and the Commitment
of the Banks shall automatically terminate, all without any action by the
Administrative Agent, the Managing Agents, or any of the Banks or any other
holder of the Notes and without presentment, demand, protest or other notice of
any kind, all of which are expressly waived, anything in this Agreement or in
the Notes to the contrary notwithstanding.
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(c) The Administrative Agent, on behalf of the Managing Agents
and the Banks, and with the concurrence of the Majority Banks may exercise all
of the post-default rights granted to it and to them under the Loan Documents or
under Applicable Law.
(d) Subject to the obtaining of any necessary consents from
appropriate federal, state and local governmental entities, the Administrative
Agent shall have the right (but not the obligation), on behalf of the Managing
Agents and the Banks, to operate the Systems in accordance with the terms of,
and subject to, the Licenses and any other Applicable Law and subject to any
limitations contained in the Loan Documents, and, within guidelines established
by the Majority Banks, to make any and all payments and expenditures necessary
or desirable in connection therewith, including, without limitation, payment of
wages as required under the Fair Labor Standards Act, as amended, and of any
necessary withholding taxes to state or federal authorities. In the event the
Majority Banks fail to agree upon the guidelines referred to in the preceding
sentence within ten (10) Business Days after the Administrative Agent has begun
to operate the Systems, the Administrative Agent may make such payments and
expenditures as it deems reasonable and advisable in its sole discretion to
maintain the normal day-to-day operation of the Systems. Such payments and
expenditures in excess of receipts shall constitute Advances under this
Agreement, notwithstanding any limitation that might otherwise be imposed on
Advances by the amount of the Commitment. Advances made pursuant to this Section
8.2(d) shall bear interest at the Default Rate for Base Rate Advances and shall
be payable on DEMAND. The making of one or more Advances under this Section
8.2(d) shall not create any obligation on the part of any of the Banks to make
any additional Advances hereunder. No exercise by the Administrative Agent, the
Managing Agents, or any of the Banks of the rights granted to them under this
Section 8.2(d) shall constitute a waiver of any other rights and remedies
granted to them under this Agreement, the Security Agreement, any other Loan
Document or at law. The Borrower hereby irrevocably appoints the Administrative
Agent, as agent for each of the Managing Agents and the Banks, the true and
lawful attorney of the Borrower, in its name and stead and on its behalf, to
execute, receipt for or otherwise act in connection with any and all contracts,
instruments or other documents in connection with the completion and operation
of the Systems in the exercise of the rights of each Bank under this Section
8.2(d).
(e) The rights and remedies of the Administrative Agent, the
Managing Agents and the Banks hereunder shall be cumulative, and not exclusive.
(f) Amounts collected by any Managing Agent or any Bank after
the acceleration of the Loans under this Section 8.2 shall be paid over
forthwith to the Administrative Agent, and any such amounts, together with any
other amounts received or collected hereunder or under any other Loan Document
by the Administrative Agent shall be applied in the following order of priority,
in accordance where applicable with the Commitment Ratios of the Banks (except
that payments under Section 9.3(b) shall be allocated to the Banks entitled to
such payments): (i) against the Administrative Agent's reasonable costs of
collection and counsel fees in obtaining such amounts; (ii) to the payment of
fees then due and payable in respect of the Loans; (iii) to the payment of
interest then due and payable on the Loans; (iv) to the payment of principal
then due and payable on Loans; (v) to the payment of all other amounts not
otherwise referred to in this Section 8.2(f) then due and payable
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hereunder; and (vi) to the Borrower or as otherwise required by Applicable Law.
For purposes of this Section 8.2(f), amounts due to the Administrative Agent,
the Managing Agents, the Banks, or any of them, or any affiliate of any of them,
pursuant to Interest Hedge Agreements shall be deemed to be principal amounts of
the Loans.
(g) In regard to all outstanding Letters of Credit with respect
to which presentment for draw shall not have occurred, the Borrower shall
promptly upon demand by the Administrative Agent (who shall act hereunder at the
request of the Majority Banks) deposit in an account opened by the
Administrative Agent and under its sole dominion and control for its benefit and
the benefit of each Bank an amount equal to one hundred percent (100%) of the
maximum amount currently or at any time thereafter available to be drawn on all
such Letters of Credit. The Borrower hereby grants the Administrative Agent, for
itself and for the ratable benefit of the Managing Agents and the Banks, a
security interest in, and right of setoff against, any and all amounts in such
accounts as security for the Borrower's reimbursement obligations with respect
to all outstanding Letters of Credit with respect to which amounts remain
available for draw by the beneficiary or beneficiaries thereof. Amounts held in
such account shall be applied by the Administrative Agent to the payment of
drafts drawn under such Letters of Credit, and the unused portion thereof after
such Letters of Credit shall have expired or been fully drawn upon, if any,
shall be applied to repay other Obligations next due in the manner set forth
herein. After all such Letters of Credit shall have expired or been fully drawn
upon, and all other Obligations shall have been paid in full, the balance, if
any, in such account shall be returned to the Borrower. Except as expressly
provided hereinabove, presentment, demand, protest and all other notices of any
kind are hereby expressly waived by the Borrower. In the event any such cash
collateralized Letters of Credit expire or are terminated undrawn, the cash
collateral therefor shall be returned forthwith to the Borrower.
ARTICLE 9
Change in Circumstances
Affecting Eurodollar Advances
Section 9.1 Eurodollar Basis Determination Inadequate. If after
the date hereof with respect to any proposed Eurodollar Advance for any Interest
Period, the Administrative Agent determines after consultation with the Banks
that deposits in dollars (in the applicable amount) are not being offered to
each of the Banks in the relevant market for such Interest Period, the
Administrative Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Administrative Agent notifies the Borrower that the
circumstances giving rise to such situation no longer exist, the obligations of
the Banks to make the effected type of Eurodollar Advances shall be suspended.
Section 9.2 Illegality. If, after the Agreement Date, any
applicable laws, rules or regulations, or any change therein, or any
interpretation or change in interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank with any
request or directive (whether or not having the
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force of law) of any such authority, central bank or comparable agency, shall
make it unlawful or impossible for any Bank to make, maintain or fund its
Eurodollar Advances and such Bank shall so notify the Administrative Agent, the
Administrative Agent shall forthwith give notice thereof to the other Banks and
the Borrower. Upon receipt of such notice, notwithstanding anything contained in
Article 2 hereof, each affected Eurodollar Advance of such Bank, together with
accrued interest thereon, either (a) on the last day of the then current
Interest Period applicable to such Eurodollar Advance if such Bank may lawfully
continue to maintain and fund such Eurodollar Advance to such day or (b)
immediately, if such Bank may not lawfully continue to fund and maintain such
Eurodollar Advance to such day, shall automatically and without further action
by any party convert into a Base Rate Advance under the applicable Commitment,
in an amount equal to the amount of such Eurodollar Advance. Interest accrued on
such converted Eurodollar Advance shall be due and payable on the date such
interest would have been due and payable had such Eurodollar Advance not been
converted. Any penalties or extra costs required to be paid under Section 2.10
hereof or this Article 9 shall also be due and payable.
Section 9.3 Increased Costs.
(a) If after the Agreement Date, any applicable law, rule or
regulation, or any change therein, or any interpretation or change in
interpretation or administration thereof by any government authority, central
bank or comparable agency charged with the interpretation or administration
thereof or compliance by any Bank with any request or directive (whether or not
having the force of law) or any such authority, central bank or comparable
agency:
(1) shall subject any Bank to any tax, duty or other charge with
respect to its obligation to make Eurodollar Advances, or its
Eurodollar Advances, or shall change the basis of taxation of payments
to any Bank of the principal of or interest on its Eurodollar Advances
or in respect to any other amounts due under this Agreement, in respect
to its Eurodollar Advances or its obligation to make Eurodollar
Advances (except for taxes and changes in the tax on the overall net
income of such Bank); or
(2) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors
of the Federal Reserve System, but excluding any included in an
applicable Eurodollar Reserve Percentage or Domestic Reserve
Percentage), special deposit, capital adequacy, assessment or other
requirement or condition against the assets of, deposits with or for
the account of, or credit extended by, any Bank or shall impose on any
Bank or the Eurodollar interbank borrowing market any other condition
affecting its obligation to make such Eurodollar Advances or its
Eurodollar Advances;
and the result of any of the foregoing is, in the reasonable determination of
such Bank, to increase the cost to such Bank of making or maintaining any such
Eurodollar Advances, or to reduce the amount of any sum received by such Bank
under this Agreement or under its Note or Notes with respect thereto, then, on
the earlier of a date within fifteen (15) days after demand by such Bank or the
Maturity Date as the case may be, the Borrower agrees to pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
costs for the period
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commencing on the date that is fifteen (15) days from the date of such demand;
provided, however, that notwithstanding the foregoing, the Borrower will have
thirty (30) days to make such payments if the Borrower does not receive the
notices provided for below. Within sixty (60) days of such written demand by
such Bank, the Borrower may in its discretion provide a replacement bank or
banks for such Bank, which replacement bank or banks will be subject to the
approval of the Administrative Agent and the Majority Banks (which approval, in
each case, will not be unreasonably withheld), and shall take all necessary
actions to transfer the rights, duties and obligations of such Bank to such
replacement bank or banks within such 60-day period (including the payment in
full of all Obligations hereunder due to the Bank being replaced). A certificate
of such Bank setting forth the amount, and in reasonable detail the basis for
such Bank's determination of such amount, to be paid to such Bank by the
Borrower as a result of any event referred to in paragraphs (a)(1) or (2) above
shall, absent manifest error, be conclusive. Such certificate shall be delivered
to the Borrower by such Bank with each written demand for payment referenced
above. Each Bank further agrees that it shall use its best efforts to give the
Borrower thirty (30) days prior notice, and in any event give prompt notice, of
any event referred to in paragraphs (a)(1) or (2) above which may have the
effect of increasing the cost to such Bank of making or maintaining any such
Eurodollar Advances, or to reduce the amount of any sum received by the Bank
under this Agreement or under its Note or Notes with respect thereto, by an
amount which may be reasonably determined by such Bank to be material.
(b) A certificate of any Bank claiming compensation under this
Section 9.3, providing an explanation of the event giving rise to the claim, and
setting forth the additional amount or amounts to be paid to it hereunder and
calculations therefor in reasonable detail, shall be conclusive in the absence
of manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods. The foregoing notwithstanding, if any Bank
demands compensation under this Section 9.3, the Borrower may at any time, upon
at least five (5) Business Days' prior notice to such Bank, prepay in full the
then outstanding affected Eurodollar Advances of such Bank, together with
accrued interest thereon to the date of prepayment, along with any reimbursement
required under Section 2.10 hereof. Concurrently with prepaying such Eurodollar
Advances, the Borrower may, Articles 2 and 3 hereof notwithstanding, borrow a
Base Rate Advance, or a Eurodollar Advance not so affected, from such Bank, and
such Bank shall, if so requested, make such Advance in an amount equal to the
amount of the Eurodollar Advance. Interest accrued on such Eurodollar Advance
shall be due and payable on the date such interest would have been due had such
Eurodollar Advance not been so converted. Other amounts required under Section
2.10 hereof shall also then be due and payable.
Section 9.4 Effect On Other Advances. If notice has been given
pursuant to Section 9.1 or 9.2 suspending the obligation of any Bank to make any
type of Eurodollar Advance, or requiring Eurodollar Advances of any Bank to be
repaid or prepaid, then, unless and until such Bank notifies the Borrower that
the circumstances giving rise to such repayment no longer apply, all Advances
which would otherwise be made by such Bank as the type of Eurodollar Advances
affected shall, at the option of the Borrower, be made instead as Base Rate
Advances.
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ARTICLE 10
The Administrative Agent and the Managing Agents
Section 10.1 Appointment and Authorization. Subject only to
Section 10.12 hereof, each Bank hereby irrevocably appoints and authorizes, and
hereby agrees that it will require any transferee of any of its interest in its
Loans and in its Notes irrevocably to appoint and authorize, the Administrative
Agent and, to the extent provided herein, each of the Managing Agents, to take
such actions as its agents on its behalf and to exercise such powers hereunder
and under the other Loan Documents as are delegated by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto. Neither
the Administrative Agent nor the Managing Agents, nor any of their respective
directors, officers, employees or agents shall be liable for any action taken or
omitted to be taken by them hereunder or in connection herewith, except for
their own gross negligence or wilful misconduct.
Section 10.2 Interest Holders. The Administrative Agent may
treat each Bank, or the Person designated in the last notice filed with the
Administrative Agent under this Section, as the holder of all of the interests
of such Bank in its Loans and in its Notes until written notice of transfer,
signed by such Bank (or the person designated in the last notice filed with the
Administrative Agent) and by the person designated in such written notice of
transfer, in form and substance satisfactory to the Administrative Agent, shall
have been filed with the Administrative Agent.
Section 10.3 Consultation with Counsel. The Administrative Agent
may consult with Paul, Hastings, Janofsky & Walker, Atlanta, Georgia, special
counsel to the Administrative Agent in connection with the Loan, or with other
legal counsel selected by them and shall not be liable for any action taken or
suffered by them in good faith, unless such action constitutes gross negligence
or wilful misconduct.
Section 10.4 Documents. The Administrative Agent shall be under
no duty to examine, inquire into, or pass upon the validity, effectiveness or
genuineness of this Agreement, any Note or any instrument, document or
communication furnished pursuant hereto or in connection herewith, and the
Administrative Agent shall be entitled to assume that they are valid, effective
and genuine, have been signed or sent by the proper parties and are what they
purport to be.
Section 10.5 Affiliates. With respect to the Commitment and the
Loans, the Managing Agents, the Administrative Agent and their respective
affiliates shall have the same rights and powers hereunder as any other Bank,
and the Managing Agents, the Administrative Agent and their respective
affiliates may accept deposits from, lend money to and generally engage in any
kind of business with the Parent Company, the Borrower, any of the Borrower's
Subsidiaries or any Affiliates of, or Persons doing business with, the Borrower
as if they were not also the Managing Agents, and the Administrative Agent or
affiliates thereof, respectively, and without any obligation to account
therefor. Each of the Administrative Agent and the Managing Agents has several
existing debt and equity relationships with Affiliates of the Borrower.
Section 10.6 Responsibility of the Administrative Agent. The
duties and obligations of the Administrative Agent under this Agreement are only
those expressly
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set forth in this Agreement. The Administrative Agent shall be entitled to
assume that no Default or Event of Default has occurred and is continuing unless
it has actual knowledge, or has been notified by the Borrower of such fact, or
has been notified by a Bank that such Bank considers that a Default or an Event
of Default has occurred and is continuing, and such Bank shall specify in detail
the nature thereof in writing. The Administrative Agent shall not be liable
hereunder for any action taken or omitted to be taken except for its own gross
negligence or wilful misconduct. The Administrative Agent shall provide each
Bank with copies of all documents received from the Borrower.
Section 10.7 Action by Administrative Agent.
(a) The Administrative Agent shall be entitled to use its
discretion vested in it under this Agreement with respect to exercising or
refraining from exercising any rights and with respect to taking or refraining
from taking any action or actions which it may be able to take under or in
respect of, this Agreement, unless the Administrative Agent shall have been
instructed by the Majority Banks to exercise or refrain from exercising such
rights or to take or refrain from taking such action; provided that the
Administrative Agent shall not exercise any rights under Section 8.2(a) of this
Agreement without the request of the Majority Banks. The Administrative Agent
shall incur no liability under or in respect of this Agreement with respect to
anything which it may do or refrain from doing in the reasonable exercise of its
judgment or which may seem to it to be necessary or desirable in the
circumstances, except for its gross negligence or wilful misconduct.
(b) The Administrative Agent shall not be liable to the Banks or
to any Bank in acting or refraining from acting under this Agreement in
accordance with the instructions of the Majority Banks (or, as provided in
Section 11.13 hereof, all Banks) and any action taken or failure to act pursuant
to such instructions shall be binding on all Banks.
(c) The Administrative Agent is hereby authorized to hold all
collateral pledged pursuant to the Loan Documents and to act on behalf of the
Managing Agents and the Banks, in its own capacity and through other agents and
sub-agents, either of them, under the Loan Documents, provided that the
Administrative Agent shall not agree to the release of any collateral, or any
property encumbered by any mortgage, pledge or security interest except in
compliance with Section 11.13 hereof.
Section 10.8 Notice of Default or Event of Default. In the event
that the Administrative Agent, any Managing Agent, or any Bank shall acquire
actual knowledge, or shall have been notified, of any Default or Event of
Default, the Administrative Agent, such Managing Agent, or such Bank shall
promptly notify the Banks, the other Managing Agents and the Administrative
Agent, and the Administrative Agent shall take such action and assert such
rights under this Agreement as the Majority Banks shall request in writing, and
the Administrative Agent shall not be subject to any liability by reason of its
acting pursuant to any such request. If the Majority Banks shall fail to request
the Administrative Agent to take action or to assert rights under this Agreement
in respect of any Default or Event of Default within ten (10) days after their
receipt of the notice of any Default or Event of Default, or shall request
inconsistent action with respect to such Default or Event of Default, the
Administrative Agent may, but shall not be required to, take such
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action and assert such rights (other than rights under Article 8 hereof) as it
deems in its discretion to be advisable for the protection of the Banks, except
that, if the Majority Banks have instructed the Administrative Agent not to take
such action or assert such right, in no event shall the Administrative Agent act
contrary to such instructions.
Section 10.9 Responsibility Disclaimed. The Administrative Agent
and the Managing Agents shall be under no liability or responsibility whatsoever
as Administrative Agent or Managing Agent, as the case may be:
(a) To the Borrower or any other person or entity as a
consequence of any failure or delay in performance by or any breach by, any Bank
or Banks of any of its or their obligations under this Agreement;
(b) To any Bank or Banks, as a consequence of any failure or
delay in performance by, or any breach by, the Borrower of any of its
obligations under this Agreement or the Notes or any other Loan Document; or
(c) To any Bank or Banks, for any statements, representations or
warranties in this Agreement, or any other document contemplated by this
Agreement or any information provided pursuant to this Agreement, any other Loan
Document, or any other document contemplated by this Agreement, or for the
validity, effectiveness, enforceability or sufficiency of this Agreement, the
Notes, any other Loan Document, or any other document contemplated by this
Agreement.
Section 10.10 Indemnification. The Banks agree to indemnify the
Administrative Agent (to the extent not reimbursed by the Borrower), pro rata
according to their respective Commitment Ratios, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses, or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement, any other Loan Document, or any
other document contemplated by this Agreement or any action taken or omitted by
the Administrative Agent under this Agreement, any other Loan Document, or any
other document contemplated by this Agreement, except that no Bank shall be
liable to the Administrative Agent for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the gross negligence or wilful
misconduct of the Administrative Agent.
Section 10.11 Credit Decision. Each Bank represents and warrants
to each other Bank, to the Managing Agents, and to the Administrative Agent
that:
(a) In making its decision to enter into this Agreement and to
make its Advances it has independently taken whatever steps it considers
necessary to evaluate the financial condition and affairs of the Borrower and
that it has made an independent credit judgment, and that it has not relied upon
information provided by the Administrative Agent or any of the Managing Agents;
and
(b) So long as any portion of the Loans remain outstanding, it
will continue to make its own independent evaluation of the financial condition
and affairs of the Borrower.
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Section 10.12 Successor Administrative Agent. Subject to the
appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving written notice
thereof to the Banks and the Borrower and may be removed at any time for cause
by the Majority Banks. Upon any such resignation or removal, the Majority Banks
shall have the right to appoint a successor Administrative Agent, subject (if no
Default or Event of Default then exists hereunder) to the consent of the
Borrower (which shall not be unreasonably withheld) in the event of the
appointment of a successor Administrative Agent which is not a Bank hereunder.
If no successor Administrative Agent shall have been so appointed by the
Majority Banks and shall have accepted such appointment within thirty (30) days
after the retiring Administrative Agent's giving of notice of resignation or the
Majority Banks' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent which shall be any Bank or, subject (if no Default or Event
of Default then exists hereunder) to the consent of the Borrower (which shall
not be unreasonably withheld) a commercial bank organized under the laws of the
United States of America or any political subdivision thereof which has combined
capital and reserves in excess of $250,000,000. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges, duties and obligations of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from any further duties and obligations hereunder other than as
provided in Section 11.16. After any retiring Administrative Agent's resignation
or removal hereunder as Administrative Agent, the provisions of this Article
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as the Administrative Agent.
Section 10.13 Administrative Agent May File Proofs of Claim. The
Administrative Agent may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent, its agents,
financial advisors and counsel) and the Banks allowed in any judicial
proceedings relative to the Borrower, any of its Subsidiaries, or any of its
creditors or property, and shall be entitled and empowered to collect, receive
and distribute any monies, securities or other property payable or deliverable
on any such claims, and any custodian in any such judicial proceedings is hereby
authorized by each Bank to make such payments to the Administrative Agent and,
in the event that the Administrative Agent shall consent to the making of such
payments directly to the Banks, to pay to the Administrative Agent any amount
due to the Administrative Agent for the reasonable compensation, expenses,
disbursements and advances of the Administrative Agent, its agents, financial
advisors and counsel, and any other amounts due the Administrative Agent under
Section 11.2 hereof. Nothing contained in this Agreement or the other Loan
Documents shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Bank any plan of reorganization,
arrangement, adjustment or composition affecting the Notes or the rights of any
holder thereof, or to authorize the Administrative Agent to vote in respect of
the claim of any Bank in any such proceeding.
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ARTICLE 11
Miscellaneous
Section 11.1 Notices.
(a) All notices and other communications under this Agreement
shall be in writing and shall be deemed to have been given upon the earlier of
receipt or three (3) Business Days from the date of deposit in the mail,
designated as certified mail, return receipt requested, post-prepaid, or one (1)
Business Day after being entrusted to a reputable commercial overnight delivery
service, or when delivered to the telegraph office or sent out by telex or
telecopy addressed to the party to which such notice is directed at its address
determined as provided in this Section 11.1 during the recipient's normal
business hours. When notes and other communications under this Agreement are
sent via telex, telegraph or telecopy, a copy of such notice or other
communication shall be sent by mail or commercial overnight delivery service as
provided above within one (1) Business Day thereafter. All notices and other
communications under this Agreement (other than with respect to routine
borrowings and repayments) shall be given to the parties hereto at the following
addresses:
(i) If to the Borrower, to it at:
GCI Cable, Inc.
2550 Denali Street
Suite 1000
Anchorage, Alaska 99503
Attn: John Lowber, Chief Financial Officer
Telephone: (907) 265-5600
Telecopier: (907) 265-5676
with copies to:
Bonnie J. Paskvan, Esq.
Hartig, Rhodes, Norman, Mahoney & Edwards
717 K Street
Anchorage, Alaska 99501-3397
Telephone: (907) 276-1592
Telecopier: (907) 277-4352
Prime II Management, Inc.
3000 One American Center
600 Congress Avenue
Austin, Texas 78701
Attn: President
Telephone: (512) 476-7888
Telecopier: (512) 476-4869
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Patrick K. Breeland, Esq.
Edens Snodgrass Nichols & Breeland, P.C.
2800 Franklin Plaza
111 Congress Avenue
Austin, TX 78701
Telephone: (512) 505-5906
Telecopier: (512) 505-5911
(ii) If to the Banks, to them at the
addresses set forth on Schedule 13
attached hereto;
(iii) If to the Administrative Agent, to it at:
Toronto Dominion (Texas), Inc.
909 Fannin, Suite 1700
Houston, Texas 77010
Attn: Vice President and Secretary
with a copy to:
Kevin Conboy, Esq.
Paul, Hastings, Janofsky & Walker
600 Peachtree Street, N.E.
Suite 2400
Atlanta, Georgia 30308-2222
Telephone: (404) 815-2211
Telecopier: (404) 815-2424
(iv) If to the Managing Agents, to them at
their addresses as Banks as set
forth on Schedule 13 attached
hereto
(b) Any party hereto may change the address to which notices
shall be directed under this Section 11.1 by giving ten (10) days' written
notice of such change to the other parties.
Section 11.2 Expenses.
The Borrower will promptly pay:
(a) all reasonable out-of-pocket expenses of the Administrative
Agent in connection with the preparation, negotiation, execution and delivery of
this Agreement and the other Loan Documents, and the transactions contemplated
hereunder and thereunder and the making of the initial Advance hereunder whether
or not such Advance is made, including, but not limited to, the reasonable fees
and disbursements of Paul, Hastings, Janofsky & Walker, special counsel for the
Administrative Agent;
(b) all reasonable out-of-pocket expenses of the Administrative
Agent in connection with the administration of the transactions contemplated in
this Agreement
General Communication, Inc. - Form 8-K
Page 228
or the other Loan Documents, the restructuring, refinancing and "work-out" of
such transactions, and the preparation, negotiation, execution and delivery of
any waiver, amendment or consent by the Administrative Agent, the Managing
Agents and the Banks relating to this Agreement or the other Loan Documents,
including, but not limited to, the reasonable fees and disbursements of Paul,
Hastings Janofsky & Walker, special counsel for the Administrative Agent; and
(c) all reasonable costs and out-of-pocket expenses of obtaining
performance under this Agreement or the other Loan Documents and all reasonable
costs and out-of-pocket expenses of collection if default is made in the payment
of the Notes, which in each case shall include reasonable fees and expenses of
counsel for the Administrative Agent and administrative fees for the Managing
Agents and each Bank.
Section 11.3 Waivers. The rights and remedies of the
Administrative Agent, the Managing Agents, and the Banks under this Agreement
and the other Loan Documents shall be cumulative and not exclusive of any rights
or remedies which they or any of them would otherwise have. No failure or delay
by the Administrative Agent, the Managing Agents, the Majority Banks or the
Banks in exercising any right shall operate as a waiver of such right. The
Administrative Agent, the Managing Agents, and the Banks expressly reserve the
right to require strict compliance with the terms of this Agreement in
connection with any funding of any Advance. In the event the Banks decide to
fund a Request for Advance at a time when the Borrower is not in strict
compliance with the terms of this Agreement, such decision shall not be deemed
to constitute an undertaking by the Banks to fund any further Requests for
Advance or preclude the Banks from exercising any rights available to them under
the Loan Documents or at law or equity. Any waiver or indulgence granted by the
Banks or by the Majority Banks shall not constitute a modification of this
Agreement, except to the extent expressly provided in such waiver or indulgence,
or constitute a course of dealing by the Banks at variance with the terms of the
Agreement such as to require further notice by the Banks of the Banks' intent to
require strict adherence to the terms of the Agreement in the future. Any such
actions shall not in any way affect the ability of the Banks, in their
discretion, to exercise any rights available to them under this Agreement or
under any other agreement, whether or not the Banks are a party, relating to the
Borrower.
Section 11.4 Determination by Administrative Agent Presumptively
Correct and Binding. Absent manifest error, any determination required or
expressly permitted to be made by the Administrative Agent under this Agreement
shall be made by the Administrative Agent in good faith and, when made, shall be
presumptively correct and binding on the parties.
Section 11.5 Set-Off. In addition to any rights now or hereafter
granted under Applicable Law and not by way of limitation of any such rights,
upon the occurrence of an Event of Default and until such Event of Default is
waived in writing in accordance with Section 11.13 (or, if prior to acceleration
or the exercise of any other remedies under Section 8.2 hereof, until such Event
of Default is cured), the Banks and any subsequent holder or holders of the
Notes are hereby authorized by the Borrower at any time or from time to time,
without notice to the Borrower, or to any other Person, any such notice being
hereby expressly waived, to set off and to appropriate and to apply any and all
deposits (general or special, time or demand,
General Communication, Inc. - Form 8-K
Page 229
including, but not limited to, Indebtedness evidenced by certificates of
deposit, in each case whether matured or unmatured) and any other Indebtedness
at any time held or owing by the Banks or such holder to or for the credit or
the account of the Borrower or any of its Subsidiaries, against and on account
of the obligations and liabilities of the Borrower to the Banks or such holder
under this Agreement, the Notes and any other Loan Document, including, but not
limited to, all claims of any nature or description arising out of or connected
with this Agreement, the Notes or any other Loan Document, irrespective of
whether or not (a) the Banks or the holder of the Notes shall have made any
demand hereunder or (b) the Banks shall have declared the principal of and
interest on the Loans and the Notes and other amounts due hereunder to be due
and payable as permitted by Section 8.2.
Section 11.6 Assignment.
(a) The Borrower may not assign or transfer any of its rights
nor delegate any of its obligations hereunder or under the Notes without the
prior written consent of each Bank.
(b) Each of the Banks may at any time enter into participation
or assignment agreements with one or more other Banks or other Persons pursuant
to which each Bank may sell participations in or assign its interests under this
Agreement and the other Loan Documents, provided, that unless otherwise agreed
to by the Borrower and the Administrative Agent, (1) all assignments and
participations (other than assignments described in clause (2) hereof) shall be
for no more than seventy-five percent (75%) of such Bank's interest hereunder,
and all assignments (other than assignments described in clause (2) hereof)
shall be in minimum principal amounts of Seven Million Five Hundred Thousand
Dollars ($7,500,000), (2) each Bank may sell assignments and participations of
up to one hundred percent (100%) of its interests hereunder to (a) one or more
affiliates of such Bank, or (b) any Federal Reserve Bank as collateral security
pursuant to Regulation A of the Board of Governors of the Federal Reserve System
and any Operating Circular issued by such Federal Reserve Bank, provided, that
no such assignment described in clause (b) shall relieve such Bank from its
obligations hereunder, and (3) all assignments (other than assignments described
in clause (2) hereof) and participations hereunder shall be subject to the
following additional terms and conditions:
(i) No assignment shall be sold without the consent
of the Administrative Agent and (so long as no Event of Default exists
hereunder) the Borrower, which consent shall not be unreasonably
withheld.
(ii) Any Person purchasing a participation or an
assignment of the Loans from any Bank shall be required to represent
and warrant that its purchase shall not constitute a "prohibited
transaction" (as defined in Section 4.1(m) hereof).
(iii) The Borrower, the Banks, the Managing Agents,
and the Administrative Agent agree that assignments permitted hereunder
(including the assignment of any Advance or portion thereof) may be
made with all voting rights, and shall be made pursuant to an
Assignment and Assumption Agreement in substantially the form attached
hereto as Exhibit A. An
General Communication, Inc. - Form 8-K
Page 230
administrative fee of $2,500 shall be payable to the Administrative
Agent by the assigning Bank at the time of any assignment hereunder.
(iv) Each Bank agrees to provide the Administrative
Agent and the Borrower with prompt written notice of any issuance of
participations or assignments of its interests hereunder.
(v) No assignment, participation or other transfer
of any rights hereunder or under the Notes shall be effected that would
result in any interest requiring registration under the Securities Act
of 1933, as amended, or qualification under any state securities law.
(vi) Each Bank agrees that (x) no participation
agreement shall confer any rights under this Agreement or any other
Loan Document to any purchaser thereof, (y) no Person to which a
participation is issued shall have any right to exercise or enforce any
rights under this Agreement or under any other Loan Document, and (z)
any participation agreement permitted hereunder shall (a) (subject to
clause (vii) of this Section 11.6(b)) expressly provide that the issuer
thereof will at all times retain the right to vote or take any other
actions with respect to its interests hereunder for the full Commitment
Ratio assigned to such issuing Bank hereunder, both before and after
the occurrence of any Default, (b) expressly reserve the unqualified
right of such Bank to repurchase the participant's share of the Loans
at par at any time, and the right of the Borrower to repay in full the
amount of the issuing Bank's Note hereunder in the event the
participant fails to cooperate with the Borrower, the Administrative
Agent and the Banks, (c) contain an express representation by the
participant that it is purchasing such participation for its own
account and not as agent or trustee for any Plan or trust, and (d)
expressly prohibit the reassignment of any participation to any Person
other than the Administrative Agent or any of the Banks.
(vii) The participation may also provide that the
issuing Bank will not, without the consent of the participant, agree to
any modification, amendment or waiver of this Agreement which would (a)
forgive or otherwise reduce or extend the time of payment of principal
amount of or any payment of principal of or interest on the Loans, (b)
alter the amount of the Commitment, or the Commitment Ratios, (c)
reduce the amount of or delay the payment of fees (other than the fees
due the Administrative Agents and the Managing Agents hereunder)
hereunder or (d) release any Collateral, or agreements relating to any
security for the Loans, except as expressly provided herein.
(viii) The amount, terms and conditions of any
participations or assignments shall be as set forth in the
participation or assignment agreement between the issuing or assigning
Bank and the Person purchasing such participation or assignment, except
as provided in the Assignment and Assumption Agreement, and neither the
Borrower, the Administrative Agent, nor any Managing Agent, or any
other Bank shall have any responsibility or obligations with respect
thereto, or to any Person to whom such participation or assignment may
be issued.
General Communication, Inc. - Form 8-K
Page 231
(ix) No such assignment may be made to any Bank or
other financial institution (x) with respect to which a receiver or
conservator (including, without limitation, the Federal Deposit
Insurance Corporation, the Resolution Trust Company or the Office of
Thrift Supervision) has been appointed or (y) that is not "adequately
capitalized" (as such term is defined in Section 131(b)(1)(B) of the
Federal Deposit Insurance Corporation Improvement Act as in effect on
the Agreement Date.
(c) Except specifically set forth in Section 11.6(b) hereof,
nothing in this Agreement or the Notes, expressed or implied, is intended to or
shall confer on any Person other than the respective parties hereto and thereto
and their successors and assignees permitted hereunder and thereunder any
benefit or any legal or equitable right, remedy or other claim under this
Agreement or the Notes.
Section 11.7 Accounting Principles. All references in this
Agreement to GAAP shall be to such principles as in effect from time to time.
All accounting terms used herein without definition shall be used as defined
under GAAP.
Section 11.8 Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed to be an original, but all
such separate counterparts shall together constitute but one and the same
instrument.
Section 11.9 Governing Law. THIS AGREEMENT AND THE NOTES SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO THE CONFLICTS OR CHOICE OF LAW PRINCIPLES THEREOF.
Section 11.10 Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall be ineffective to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof in that jurisdiction or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 11.11 Interest and Charges. (a) No provision of this
Agreement, any Note, or any other Loan Document shall require the payment or
permit the collection of interest in excess of the maximum lawful rate permitted
by Applicable Law. If any excess amount of interest in such respect is provided
for, or shall be adjudicated to be so provided in connection with the Loans, the
provisions of this Section 11.11(a) shall govern and prevail, and neither the
Borrower nor any sureties, guarantors, successors or assigns of the Borrower
shall be obligated to pay the excess amount of such interest or any other excess
sum paid for the use, forbearance, or detention of sums loaned pursuant hereto.
In the event the Borrower ever pays, or any Bank ever receives, collects or
applies as interest, any such sum, such amount which would be in excess of the
maximum amount permitted by Applicable Law shall be applied as a payment in
reduction of the principal, unless the Borrower shall notify such Bank in
writing that it elects to have such excess returned forthwith; and, if the
principal has been paid in full, any remaining excess shall forthwith be
returned to the Borrower. Because of the variable nature of the rates of
interest that the Indebtedness evidenced by the Notes may bear, the total
interest that will accrue on any Note cannot be determined in advance. Neither
the Borrower nor any Bank intends for the Banks to contract for, charge or
receive usurious interest.
General Communication, Inc. - Form 8-K
Page 232
(b) Notwithstanding the use by the Banks of the Base Rate and
the Eurodollar Rate as reference rates for the determination of interest on the
Loans, the Banks shall be under no obligation to obtain funds from any
particular source in order to charge interest to the Borrower at interest rates
tied to such reference rates, and may obtain funds in any manner they
respectively see fit. The provisions of this Agreement relating to the funding
and pricing of Advances hereunder are included only for the purpose of
conducting operations hereunder, and it is therefore understood that, regardless
of the manner selected by any Bank to fund Advances hereunder, all operations
hereunder, including without limitation the determination of the interest rate
applicable to any Advance and amounts payable hereunder, shall be conducted as
if each Bank had actually funded its Advance through the purchase of deposits in
like amount having terms coterminous with the applicable Interest Periods
relating thereto.
Section 11.12 Headings. Headings used in this Agreement are for
convenience only and shall not be used in connection with the interpretation of
any provision hereof.
Section 11.13 Amendment and Waiver. Neither this Agreement nor
any term hereof may be amended orally, nor may any provision hereof be waived
orally but only by an instrument in writing signed by the Majority Banks and, in
the case of an amendment, by the Borrower, except that in the event of (a) any
change in the amount of the Commitment, or in any Bank's Commitment Ratio (other
than by way of assignment pursuant to Section 11.6(b) hereof), (b) any change in
the terms of repayment of the Loans and Commitment reduction provided in
Sections 2.6 and 2.7 hereof, (c) any change in principal, interest or fees due
hereunder or postponement of the payment thereof, (d) any release or impairment
of the value of any portion of the Collateral for the Loans, except in
connection with a disposition of assets by the Borrower or any of its
Subsidiaries to the extent permitted under Section 7.5(a)(ii) hereof, (e) any
waiver of any Default due to the failure by the Borrower to pay any sum due
hereunder, (f) any change in the Manager, or (g) any amendment of Section
11.6(a), of this Section 11.13 or of the definition of Majority Banks, any
amendment or waiver or consent may be made only by an instrument in writing
signed by each of the Banks and, in the case of an amendment, by the Borrower.
Section 11.14 Entire Agreement. Except as otherwise expressly
provided herein, this Agreement and the other documents described or
contemplated herein embody the entire agreement and understanding between or
among any of the parties hereto and thereto and supersede all prior agreements
and understandings relating to the subject matter hereof and thereof between or
among any of the parties hereto.
Section 11.15 Other Relationships. No relationship created
hereunder or under any other Loan Documents shall in any way affect the ability
of the Administrative Agent, the Managing Agents, and each Bank to enter into or
maintain business relationships with the Borrower, the Manager or any of their
respective Affiliates beyond the relationships specifically contemplated by this
Agreement and the other Loan Documents.
Section 11.16 Loan Documents. All references to "Loan Agreement"
in each and every Loan Document shall hereafter refer to this Agreement, as the
same may be amended or modified from time to time. In addition, any references
in the
General Communication, Inc. - Form 8-K
Page 233
Loan Documents (as defined in the Prior Loan Agreement) to specific provisions
of the Prior Loan Agreement are hereby amended by adopting the applicable
provisions, if any, set forth in this Agreement.
Section 11.17 Confidential Treatment. All agreements,
instruments, documents and other information received pursuant to this Agreement
or any other Loan Document by the Administrative Agent, the Managing Agents and
the Banks shall be held in confidence by the Administrative Agent, the Managing
Agents and the Banks, except for disclosures made (i) in connection with
assignments of or participations in the Loans made pursuant to Section 11.6
hereof (provided that such assignees or participants shall agree in writing to
keep such information confidential as provided herein), (ii) as otherwise
required to be disclosed by banking regulations, process of law, or other
Applicable Law, or to government regulators, (iii) of information received by
the Administrative Agent, a Managing Agent or a Bank without restriction as to
its disclosure or use from a Person who, to such Person's knowledge or
reasonable belief, was not prohibited from disclosing it by any duty of
confidentiality, (iv) in connection with litigation arising from this Agreement
or to which the Administrative Agent, a Managing Agent or a Bank is a party, (v)
of information which is or has become public (other than through unauthorized
disclosure by the Administrative Agent, a Managing Agent or a Bank), (vi) to the
attorneys, accountants, and other expert consultants for the Administrative
Agent, a Managing Agent or a Bank (who shall be requested to similarly hold such
information in confidence), or (vii) as otherwise permitted hereunder.
Section 11.18 Reliance on and Survival of Various Provisions.
Any right to indemnification hereunder, including, without limitation, rights
pursuant to Sections 2.10, 2.12, 5.12, 9.3, and 11.2 hereof accruing to parties
and former parties to this Agreement, shall survive the termination of this
Agreement and the payment and performance of all other Obligations; provided,
however, that upon the full payment and performance of all Obligations other
than such indemnification obligations, the Administrative Agent shall take such
reasonable measures as may be requested by the Borrower to release the Liens of
the Administrative Agent and the Banks on the Collateral.
[Remainder of page intentionally left blank]
General Communication, Inc. - Form 8-K
Page 234
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers, all as of the day and
year first above written.
BORROWER: GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
ADMINISTRATIVE TORONTO DOMINION (TEXAS), INC.
AGENT:
By: /s/ Jano Mott
Its: Vice President
T-D BANK: THE TORONTO DOMINION BANK, HOUSTON
AGENCY
By: /s/ Jano Mott
Its:
MANAGING TORONTO DOMINION (TEXAS), INC.
AGENTS:
By: /s/ Jano Mott
Its: Vice President
THE CHASE MANHATTAN BANK N.A.
By: /s/
Its:
General Communication, Inc. - Form 8-K
Page 235
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Mark D. Thorsheim
Its: Vice President
NATIONSBANK OF TEXAS, N.A.
By: /s/
Its: Senior Vice President
SYNDICATION NATIONSBANK OF TEXAS, N.A.
AGENT:
By: /s/
Its: Senior Vice President
DOCUMENTATION CREDIT LYONNAIS NEW YORK BRANCH
AGENT:
By: /s/ Mark D. Thorsheim
Its: Vice President
BANKS: TORONTO DOMINION (TEXAS), INC.
By: /s/ Jano Mott
Its: Vice President
THE CHASE MANHATTAN BANK N.A.
By: /s/
Its:
General Communication, Inc. - Form 8-K
Page 236
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Mark D. Thorsheim
Its: Vice President
NATIONSBANK OF TEXAS, N.A.
By: /s/
Its: Senior Vice President
THE BANK OF NEW YORK
By: /s/
Its: Vice President
BANQUE PARIBAS
By: /s/ Sonia Isaacs Harry Collyns
Its: Vice President Vice President
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Ervine H. Geiger
Its: Banking Officer
THE FIRST NATIONAL BANK OF MARYLAND
By: /s/
Its: Senior Vice President
General Communication, Inc. - Form 8-K
Page 237
EXHIBIT A
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement is made and entered into as of
the day of , 19 , by and among
(the "Assignor"), (the "Assignee"), GCI Cable, Inc., an
Alaska corporation (the "Borrower"), and Toronto Dominion (Texas), Inc. (the
"Administrative Agent").
RECITALS
A. Toronto Dominion (Texas), Inc., NationsBank of Texas, N.A.,
The Chase Manhattan Bank, N.A. and Credit Lyonnais Cayman Island Branch, as
managing agents (collectively, the "Managing Agents"); the Assignor and the
other Banks party thereto (the "Banks"); the Administrative Agent, as agent for
the Managing Agents and the Banks; and the Borrower are parties to that certain
Loan Agreement dated as of October 31, 1996 (as amended, supplemented or
modified from time to time, the "Loan Agreement"). Pursuant to the Loan
Agreement, the Banks have agreed to extend credit to the Borrower in an
aggregate principal amount not to exceed at any time outstanding the Commitment
(as defined in the Loan Agreement), of which the Assignor's commitment is the
amount specified in Item 1 of Schedule 1 hereto (the "Assignor's Commitment").
The aggregate principal amount of the outstanding Loan made by the Assignor to
the Borrower pursuant to the Assignor's Commitment is specified in Item 2 of
Schedule 1 hereto (the "Assignor's Loans"). All capitalized terms not otherwise
defined herein are used herein as defined in the Loan Agreement.
B. The Assignor wishes to sell and assign to the Assignee, and
the Assignee wishes to purchase and assume from the Assignor, (i) the portion of
the Assignor's Commitment specified in Item 3 of Schedule 1 hereto which is
equivalent to the percentage specified in Item 4 of Schedule 1 of the Commitment
(the "Assigned Commitment"), and (ii) a portion of the Assignor's Loan specified
in Item 5 of Schedule 1 hereto (the "Assigned Loan").
The parties agree as follows:
1. Assignment. Subject to the terms and conditions set forth
herein, the Assignor hereby sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, without recourse, (a) all right,
title and interest of the Assignor to the Assigned Loan and (b) all obligations
of the Assignor under the Loan Agreement with respect to the Assigned
Commitment. As full consideration for the sale of the Assigned Loan and the
Assigned Commitment, the Assignee shall pay to the Assignor the principal amount
of the Assigned Loan (the "Purchase Price").
2. Consent and Undertaking. The Borrower hereby consents to
the assignment made herein, and undertakes within five (5) Business Days from
the date hereof to provide new Notes to the Assignee and the Assignor,
reflecting the amount of the Assigned Commitment, and the Assignor's Commitment
less the Assigned Commitment, respectively, and the Assignor agrees on the
Business Day following receipt of its new Notes, to return its superseded Notes
to the Borrower.
General Communication, Inc. - Form 8-K
Page 238
3. Representations and Warranties. Each of the Assignor and
the Assignee represents and warrants to the other that (a) it has full power and
legal rights to execute and deliver this Agreement and to perform the provisions
of this Agreement; (b) the execution, delivery and performance of this Agreement
have been authorized by all necessary action on its part, corporate or
otherwise, and do not violate any provisions of its charter or by-laws or any
contractual obligations or requirement of law binding on it; (c) that this
Agreement is not a "prohibited transaction," as such term is used in Section
4.1(m) of the Loan Agreement; and (d) this Agreement constitutes its legal,
valid and binding obligation, enforceable against it in accordance with its
terms.
4. Condition Precedent. The obligations of the Assignor and
the Assignee hereunder shall be subject to the fulfillment of the condition that
the Assignor shall have (i) received payment in full of the Purchase Price, and
(ii) complied with other applicable provisions of Section 11.6 of the Loan
Agreement.
5. Consent to be Bound. The Assignee acknowledges that it has
reviewed the terms and conditions of the Loan Agreement and the other Loan
Documents referred to in or delivered pursuant to the Loan Agreement, and
acknowledges and expressly agrees that it will be bound by the terms and
conditions of the Loan Agreement and the other Loan Documents.
6. Notice of Assignment. The Assignor agrees to give notice of
the assignment and assumption of the Assigned Loan and the Assigned Commitment
to the Administrative Agent and hereby instructs the Administrative Agent to
make payments with respect to the Assigned Loan and the Assigned Commitment
directly to the Assignee at the offices specified in Item 6 on Schedule 1 hereto
(which shall also be the Assignee's address for notices pursuant to Section 11.1
of the Loan Agreement); provided, however, that the Borrower and the
Administrative Agent shall be entitled to continue to deal solely and directly
with the Assignor in connection with the interest so assigned until (i) the
Administrative Agent shall have received a counterpart of this Agreement duly
executed by the Assignor, the Assignee and the Borrower, (ii) the Assignor shall
have delivered to the Borrower any Notes that shall be subject to such
assignment, and (iii) all other conditions set forth in Section 11.6(b) of the
Loan Agreement have been satisfied, including the receipt by the Administrative
Agent of the $2500 administrative fee referred to in clause (iii) thereof. From
and after the date (the "Effective Date") on which the Administrative Agent
shall notify the Borrower, the Assignee, and the Assignor that (i), (ii) and
(iii) shall have occurred and all consents (if any) required shall have been
given, the Assignee shall be deemed to be a party to the Loan Agreement and, to
the extent that rights and obligations thereunder shall have been assigned to
the Assignee as provided herein, shall have the rights and obligations of a Bank
under the Loan Agreement. After the Effective Date, (a) all interest, principal,
fees and other amounts that would otherwise be payable to the Assignor in
respect of the Assigned Loan and the Assigned Commitment shall be paid to the
Assignee, and (b) if the Assignor receives any payment on account of the
Assigned Loan or the Assigned Commitment, the Assignor shall hold such payment
for the benefit of the Assignee and shall promptly deliver it to the Assignee.
The Assignee agrees to deliver to the Borrower and the Administrative Agent such
Internal Revenue Service forms as may be required to establish that the Assignee
is entitled to receive payments under the Loan Agreement without deduction or
withholding of tax.
General Communication, Inc. - Form 8-K
Page 239
7. Independent Investigation. The Assignee acknowledges that
it is purchasing the Assigned Loan and the Assigned Commitment from the Assignor
totally without recourse and, except as provided in Section 3 hereof, without
representation or warranty. The Assignee further acknowledges that it has made
its own independent investigation and credit evaluation of the Borrower in
connection with its purchase of the Assigned Loan and the Assigned Commitment.
Except for the representations or warranties set forth in Section 3 hereof, the
Assignee acknowledges that it is not relying on any representation or warranty
of the Assignor, expressed or implied, including without limitation, any
representation or warranty relating to the legality, validity, genuineness,
enforceability, collectability, interest rate, repayment schedule or accrual
status of the Assigned Loan or the Assigned Commitment, the legality, validity,
genuineness or enforceability of the Loan Agreement, the related Notes, or any
other Loan Document referred to in or delivered pursuant to the Loan Agreement,
or the financial condition or creditworthiness of the Borrower. The Assignor has
not and will not be acting as either the representative, agent or trustee of the
Assignee with respect to matters arising out of or relating to the Loan
Agreement or this Agreement. From and after the Effective Date, the Assignor
shall have no rights or obligations with respect to the Assigned Loan or the
Assigned Commitment.
8. Method of Payment. All payments to be made by any party
hereunder shall be in funds available at the place of payment on the same day
and shall be made by wire transfer to the account designated by the party to
receive payment.
9. Integration. This Agreement shall supersede any prior
agreement or understanding between the parties (other than the Loan Documents)
as to the subject matter hereof.
10. Counterparts; Etc. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original and
shall be binding upon the parties, and their respective successors and assigns.
11. Governing Law. This Agreement shall be governed by, and
construed in accordance with the laws of, the State of New York.
[ASSIGNOR]
By:
Title:
[ASSIGNEE]
By:
Title:
Acknowledged and agreed to:
General Communication, Inc. - Form 8-K
Page 240
GCI CABLE, INC.
By:
Title:
and
TORONTO DOMINION (TEXAS), INC.,
as Administrative Agent
By:
Title:
General Communication, Inc. - Form 8-K
Page 241
SCHEDULE 1
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
Loan Agreement
Among GCI Cable, Inc.
the Banks, the Managing Agents,
and the Administrative Agent
dated as of October 31, 1996
Item 1. Assignor's Commitment $
Item 2. Assignor's Loan $
consisting of:
Base Rate Advances $
Eurodollar Advances $
Item 3. Amount of Assigned Commitment $
Item 4. Assignee's Commitment Ratio _____%
Item 5. Amount of Assigned Loan $
consisting of:
Base Rate Advances $
Eurodollar Advances $
Item 6. Lending Office of Assignee
and Address for Notices
under Loan Agreement
General Communication, Inc. - Form 8-K
Page 242
Notes to Schedule 1
1. Insert the dollar amount of Assignor's Commitment prior to
assignment.
2. Insert the total amount of outstanding Loan of Assignor,
showing breakdown by type. Description of the type of Loan should conform to the
description in the Loan Agreement.
3. Insert the dollar amount of the Assignor's Commitment,
including outstanding Loans, being assigned.
4. Assigned Commitment, as of a percentage of total
commitments of all lenders.
5. Insert the total amount of outstanding Loan of Assignor
being assigned to Assignee. Description of the type of Loans should be
consistent with Item 2.
6. Insert the name and address of the lending office of the
Assignee.
General Communication, Inc. - Form 8-K
Page 243
EXHIBIT B
FORM OF ASSIGNMENT OF PARTNERSHIP INTERESTS
THIS ASSIGNMENT OF PARTNERSHIP INTERESTS (the "Assignment"), is made as
of the 31st day of October, 1996 by GCI Cable, Inc., an Alaska corporation (the
"Borrower"), and GCI Cable Holdings, Inc., an Alaska corporation ("GCI
Holdings") (the Borrower and GCI Holdings are also referred to collectively
herein as the "Partners" and individually as a "Partner") in favor of Toronto
Dominion (Texas), Inc., as administrative agent for the Banks and the Managing
Agents (the "Administrative Agent").
W I T N E S S E T H:
IN CONSIDERATION of the execution and delivery of a certain Loan
Agreement of even date (as amended, modified or supplemented from time to time,
the "Loan Agreement") among Borrower, the Administrative Agent, the Banks and
the Managing Agents pursuant to which the Banks have agreed to make loans (the
"Loans") to the Borrower; the sum of Ten and No/100 Dollars ($10.00) in hand
paid; and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged: (a) the Borrower hereby sells, assigns,
transfers, conveys and grants unto the Administrative Agent for itself and on
behalf of the Banks, the Managing Agents, and their respective successors and
assigns, all of its right, title and interest in and to, and a continuing
security interest in and security title to, its ninety-nine percent (99%)
general partner interest in the Prime Cable of Alaska, L.P., a Delaware limited
partnership (the "Partnership"); and (b) GCI Holdings hereby sells, assigns,
transfers, conveys and grants unto the Administrative Agent for itself and on
behalf of the Banks, the Managing Agents, and their respective successors and
assigns, all of its right, title and interest in and to, and a continuing
security interest in and security title to, its one percent (1%) limited partner
interest in the Partnership. Such assignment shall include, without limitation,
with respect to such general partner and limited partner interests, the right to
receive all proceeds, distributions of income, profits, surplus or other
compensation by way of income or liquidating distributions, in cash or in kind,
from the Partnership, including such right, title and interest now owned by such
Partner or which is hereafter acquired by it (the "Assigned Rights"), as
security for payment and performance of all obligations of such Partner to the
Administrative Agent, the Banks and the Managing Agents, or any of them, under
the Loan Agreement and other Loan Documents, including but not limited to the
Subsidiary Guaranty, or any extensions, renewals or amendments thereto, however
created, acquired, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due (all of the
foregoing obligations being hereinafter collectively referred to as the "Senior
Debt").
TO HAVE AND TO HOLD UNTO the Administrative Agent, for the benefit of
itself and the Banks and the Managing Agents, and their successors and assigns
forever, upon and subject to the following terms and conditions:
General Communication, Inc. - Form 8-K
Page 244
1. For purposes of this Assignment, capitalized terms used
herein shall have the meanings ascribed thereto in the Loan Agreement unless
otherwise defined herein.
2. Each Partner hereby constitutes and appoints the
Administrative Agent as its true and lawful attorney, in its name and stead upon
the occurrence and during the continuation of an Event of Default: (a) to
collect any and all distributions of cash and other assets due such Partner from
the Partnership or otherwise in respect of the Assigned Rights, and (b) to use
such measures, legal or equitable, as in its discretion may be deemed necessary
or appropriate to enforce the payment thereof to the Administrative Agent. The
power of attorney hereby created is coupled with an interest and is irrevocable
so long as any of the Senior Debt remains unpaid or any of the Banks shall have
an obligation to make Advances under the Loan Agreement.
3. The Administrative Agent is hereby granted full irrevocable
power and authority to hold, use and apply all cash and non-cash distributions
received by it upon the occurrence and during the continuation of an Event of
Default (together with all interest earned thereon) in full or partial payment
of the Senior Debt and may convert any such non-cash distributions to cash and
may apply the proceeds thereof in payment of charges or expenses incurred by the
Administrative Agent in connection with any and all things which the
Administrative Agent, the Banks and the Managing Agents may do or cause to be
done hereunder.
4. None of the Administrative Agent, the Banks and the
Managing Agents shall in any way be responsible for any failure to do any or all
of the things for which rights, interests, power and authority are herein
granted. The Administrative Agent, the Banks and the Managing Agents shall be
responsible only for the application of such cash or other property as they
actually receive under the terms hereof; provided, however, that the failure of
the Administrative Agent, the Banks and the Managing Agents, or any of them, to
do any of the things or exercise any of the rights, interests, powers and
authorities hereunder shall not be construed to be a waiver of any such rights,
interests, powers and authorities.
5. This Assignment shall not operate to place any
responsibility or obligation whatsoever upon the Administrative Agent, the Banks
and the Managing Agents, or any of them. None of the Administrative Agent, the
Banks and the Managing Agents shall have assumed any liability of a Partner or
of the Partnership as a result of this Assignment. Each Partner agrees to
protect, indemnify and save harmless the Administrative Agent, the Banks and the
Managing Agents from and against all liabilities, obligations, claims, damages,
penalties, causes of action, reasonable costs and expenses including, without
limitation, reasonable attorneys' fees and expenses (except as may arise from
the gross negligence or wilful misconduct of the Person seeking indemnification)
imposed upon or incurred by the Administrative Agent, the Banks and the Managing
Agents, or any of them, by reason of this Assignment and any claim and demand
whatsoever which may be asserted against the Administrative Agent, the Banks and
the Managing Agents, or any of them, by reason of any alleged obligation or
undertaking to be performed or discharged by the Administrative Agent, the Banks
and the Managing Agents, or any of them, under this Assignment. In the event the
Administrative Agent, the Banks and the Managing
General Communication, Inc. - Form 8-K
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Agents, or any of them, incurs any liability, loss or damage by reason of this
Assignment, or in curing any default or breach by any Partner of its obligations
under any agreement related to the Partnership ("Partnership Agreements"), or in
the defense of any claims or demands arising out of or in connection with this
Assignment, the amount of such liability, loss or damage shall be added to the
Senior Debt (except to the extent such liabilities, losses or damages arise from
the gross negligence or willful misconduct of the Person incurring such
liabilities, losses or damages).
6. Each Partner agrees to execute, deliver and record, upon
the request of the Administrative Agent, any and all instruments reasonably
requested by the Administrative Agent to carry these presents into effect or to
accomplish any other purpose deemed by the Administrative Agent to be necessary
or appropriate in connection with these presents, expressly including UCC-l
Financing Statements.
7. Each Partner hereby warrants and represents that the copies
of the Partnership Agreement of the Partnership furnished to the Administrative
Agent, the Banks and the Managing Agents are true, complete and correct copies
of such Partnership Agreement, as amended through the date hereof; that such
Partnership Agreement is unmodified since the date of the last modification as
reflected in such copy of the Partnership Agreement and in full force and
effect; that the Assigned Rights have not been heretofore sold, assigned,
transferred, set over or encumbered by any instrument now in force, and will not
at any time during the term of this Assignment be sold, assigned, transferred,
set over or encumbered by it or by any Person or Persons whomsoever, without the
prior written consent of the Administrative Agent; that the Assigned Rights are
all of such rights such Partner has arising from its partnership interests in
the Partnership and that percentage interests of such Partner in the Partnership
are as set forth on the first page hereof; that such Partner has the right to
sell, assign, transfer, set over and encumber the Assigned Rights to the
Administrative Agent and to grant to and confer upon the Administrative Agent
the Assigned Rights; that such Partner is not at present in default in any
material respect under the Partnership Agreement; and that all actions,
approvals and consents required by Applicable Law or by any agreement to which
such Partner or any Partnership is a party have been obtained.
8. Each Partner hereby agrees that it will not, except as
permitted under the Loan Agreement, at any time during the term of this
Assignment, convey or encumber any of its interests, including, without
limitation, the Assigned Rights, in the Partnership in any manner whatsoever or
consent to any departure from or any modification or amendment to the
Partnership Agreement (except as permitted in the Loan Agreement), or consent to
the admission of any new general partner or consent to any change in the
business of the Partnership (except as permitted in the Loan Agreement), without
the prior written consent of the Administrative Agent. Each Partner agrees that
it will perform all its obligations as a general and limited partner, as the
case may be, under the Partnership Agreement and that it will do all things
necessary to maintain its interests in the Partnership in full force and effect.
9. In the event any Partner receives any payment or other
distribution of any kind or character from the Partnership or from any other
source whatsoever in
General Communication, Inc. - Form 8-K
Page 246
respect of such Partner's interest in the Partnership, such payments or other
distributions shall be received in trust for the Administrative Agent, the Banks
and the Managing Agents and shall be promptly turned over by such Partner to the
Administrative Agent. Each Partner will mark its books and records, so as to
clearly indicate that such Partner's rights as a general partner and a limited
partner of the Partnership is subject to the terms of this Assignment.
10. This Assignment and the rights hereunder shall inure to
the benefit of the Administrative Agent, the Banks and the Managing Agents, and
may be assigned in whole or in part by the Administrative Agent, the Banks and
the Managing Agents in connection with any assignment of the Loan Agreement or
the Indebtedness evidenced thereby, as is permitted thereunder, and shall be
binding upon each Partner and its respective successors and assigns.
11. Notwithstanding anything herein to the contrary, it is
understood and agreed that although this Assignment is and shall be effective as
of the date hereof, no right or power granted hereunder or obligation under
Section 9 hereof shall be exercised or enforced by the Administrative Agent
unless and until an Event of Default, as hereinafter specified, shall occur and
be continuing hereunder. It is the intention of the parties hereto that
beneficial ownership of the Assigned Rights, including, without limitation, all
voting, consensual and distribution rights, shall remain in each Partner until
an Event of Default, shall occur and be continuing. Any Event of Default under
the Loan Agreement shall constitute an "Event of Default" hereunder. Upon the
occurrence of any Event of Default, the Administrative Agent may exercise such
rights and remedies as are provided in the Loan Agreement and in this
Assignment. The rights and remedies granted hereunder shall be cumulative, and
not exclusive. Each Partner expressly agrees that none of the Administrative
Agent, the Banks and the Managing Agents shall in any event be under any
obligation to resort to any right or remedy hereunder prior to exercising any
other rights any of them may have against such Partner or the Borrower or any
other Person to secure repayment of the Obligations, nor shall the
Administrative Agent, the Banks or the Managing Agents be required to resort to
any such other rights prior to the exercise of rights and remedies hereunder.
12. Subject to Section 15 below, for so long as any of the
Obligations shall remain unpaid and after the occurrence and during the
continuation of an Event of Default, the Administrative Agent may exercise all
ownership or consensual rights pertaining to the Assigned Rights of each Partner
and may notify and instruct the Partnership to thereafter make all payments
otherwise due such Partner in respect of the Assigned Rights payable directly to
the Administrative Agent, and the Administrative Agent shall have the right to
apply such payments in reduction of the Obligations. Each Partner hereby
appoints the Administrative Agent as such Partner's true and lawful
attorney-in-fact at such times to exercise such ownership or consensual rights
pertaining to the Assigned Rights in any manner the Administrative Agent deems
advisable for or against all matters with respect to the Partnership. The power
of attorney granted h
ereby is coupled with an interest and shall be irrevocable
so long as any of the Senior Debt remains unpaid or any of the Banks shall have
an obligation to make Advances under the Loan Agreement.
General Communication, Inc. - Form 8-K
Page 247
13. Each Partner undertakes and agrees, in connection herewith, to
deliver to the Administrative Agent a copy of any notice or mailing received by
such Partner from the Partnership, at the address of the Administrative Agent
given for notices in Section 11.1 of the Loan Agreement.
14. In addition to their rights and privileges under this Assignment,
the Administrative Agent, the Banks and the Managing Agents shall have all of
the rights, powers and privileges of a secured party under the Uniform
Commercial Code as in effect in any applicable jurisdiction.
15. Notwithstanding anything herein which may be construed to the
contrary, no action shall be taken by any of the Administrative Agent, the
Managing Agents or the Banks with respect to the Licenses or any license of the
Federal Communications Commission ("FCC") unless and until all requirements of
Applicable Law, including, without limitation, any required approval of either
of the Alaska Public Utilities Commission or the U.S. Government (together the
"Licensors") and any required approval under the Federal Communications Act of
1934, and any applicable rules and regulations thereunder, requiring the consent
to or approval of such action by either of the Licensors, the FCC or any other
governmental or other authority, have been satisfied. Each Partner covenants
that upon request of the Administrative Agent it will cause to be filed such
applications and take such other action as may be requested by such Person or
Persons to obtain consent or approval of either of the Licensors, the FCC or any
other governmental or other authority which has granted any License to such
Partner to any action contemplated by this Agreement and to give effect to the
security interest of the Administrative Agent, including, without limitation,
the execution of an application for consent by the FCC to an assignment or
transfer involving a change in ownership or control pursuant to the provisions
of the Federal Communications Act of 1934. To the extent permitted by Applicable
Law, the Administrative Agent is hereby irrevocably appointed the true and
lawful attorney-in-fact of each Partner, in its name and stead, to execute and
file all necessary applications with the Licensors, the FCC and with any other
governmental or other authority. The power of attorney granted herein is coupled
with an interest and shall be irrevocable for so long as any of the Obligations
remains unpaid or unperformed or any of the Banks have any obligation to make
Advances under the Loan Agreement, regardless of whether the conditions
precedent to the making of any such Advances has been or can be fulfilled.
16. This Assignment shall be deemed to be made pursuant to the
internal laws of the State of New York with respect to agreements made and to be
performed wholly within the State of New York and shall be construed,
interpreted, performed and enforced in accordance therewith.
17. This Assignment may be executed in multiple counterparts, each of
which shall be deemed to be an original, but all such separate counterparts
shall together constitute but one and the same instrument.
18. Upon payment in full of all principal and interest on the Notes,
full performance by the Borrower of all covenants, undertakings and obligations
under the Loan Agreement, the Notes, and the other Loan Documents, and
satisfaction in full of
General Communication, Inc. - Form 8-K
Page 248
any other Obligations and termination of the Commitments, other than the
Obligations which survive the termination of the Loan Agreement as provided in
Section 11.18 of the Loan Agreement, the Administrative Agent shall return its
interest in the Assigned Rights to the Partners.
19. Each Partner further agrees to assign and grant security title
to, and a security interest in, any partnership interests obtained by such
Partner after the date hereof. Each Partner agrees to execute, deliver and
record any amendments hereto, documents, instruments, and financing statements
deemed by the Administrative Agent to be necessary or appropriate to create or
perfect the security interest described in the foregoing sentence.
[the remainder of this page is intentionally blank]
General Communication, Inc. - Form 8-K
Page 249
IN WITNESS WHEREOF, the undersigned Partner and the Administrative
Agent have caused this instrument to be executed by their duly authorized
representatives as of the day and year first above written.
PARTNERS: GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
GCI CABLE HOLDINGS, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
ADMINISTRATIVE AGENT: TORONTO DOMINION (TEXAS), INC.
By: /s/ Jano Mott
General Communication, Inc. - Form 8-K
Page 250
EXHIBIT C
FORM OF BORROWER'S PLEDGE AGREEMENT
THIS BORROWER'S PLEDGE AGREEMENT (the "Agreement"), is entered into as
of this 31st day of October, 1996, by and between GCI Cable, Inc., an Alaska
corporation (the "Borrower") in favor of Toronto Dominion (Texas), Inc., a
Delaware corporation, as administrative agent and on behalf of the Managing
Agents and the Banks (the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Administrative Agent, the Managing Agents
and the Banks have entered into that certain Loan Agreement dated as of October
31, 1996 (as amended, modified or supplemented from time to time, the "Loan
Agreement") pursuant to which the Banks have agreed to make loans (the "Loans")
to the Borrower; and
WHEREAS, to secure the payment and performance of, among other things,
all obligations of the Borrower under the Loan Agreement, the promissory notes
issued by the Borrower to the Banks thereunder (as they may be modified, amended
or replaced, the "Notes") and the other Loan Documents, the Borrower, the
Administrative Agent, the Banks and the Managing Agents have agreed that the
shares of capital stock (the "Stock") owned by the Borrower in GCI
Cable/Fairbanks, Inc., an Alaska corporation; GCI Cable/Juneau, Inc., an Alaska
corporation; and GCI Cable Holdings, Inc., an Alaska corporation, which are all
directly-owned Subsidiaries of the Borrower (the "Subsidiaries"), shall be
pledged by the Borrower to the Administrative Agent to secure the Obligations
(as defined below);
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree that capitalized terms used herein
shall have the meanings ascribed to them in the Loan Agreement to the extent not
otherwise defined or limited herein, and further agree as follows:
1. Warranty. The Borrower hereby represents and warrants to
the Administrative Agent, the Banks and the Managing Agents, that except for the
security interest created hereby, the Borrower owns the Stock, which is all of
the issued and outstanding stock of each of the Subsidiaries, free and clear of
all Liens, that the Stock is duly issued, fully paid and non-assessable, and
that the Borrower has the unencumbered right to pledge the Stock.
2. Security Interest. The Borrower hereby unconditionally
grants and assigns to the Administrative Agent, for itself and on behalf of the
Banks and the Managing Agents, and their respective successors and assigns, a
continuing security interest in and security title to the Stock. The Borrower
has delivered to and
General Communication, Inc. - Form 8-K
Page 251
deposited with the Administrative Agent herewith all of its right, title and
interest in and to the Stock, together with certificates representing the Stock,
and stock powers endorsed in blank, as security for (a) payment and performance
of all obligations of the Borrower to the Administrative Agent, the Banks and
the Managing Agents, or any of them, under the Loan Agreement, the Notes and the
other Loan Documents (including, without limitation, any Interest Hedge
Agreements between the Borrower, on the one hand, and the Administrative Agent,
the Managing Agents and the Banks, or any of them, on the other hand, and any
interest, fees and other charges in respect of the Notes, and the other Loan
Documents that would accrue but for the filing of a bankruptcy action with
respect to the Borrower, whether or not such claim is allowed in such bankruptcy
action), as the same may be amended from time to time, or as a result of making
the Loans; (b) payment of any and all damage which the Administrative Agent, the
Banks and the Managing Agents, or any of them, may suffer by reason of a breach
of any obligation, covenant or undertaking with respect to this Agreement, the
Loan Agreement, the Notes, or any other Loan Document by the Borrower or any
other obligor thereunder (except as may arise from the gross negligence or
wilful misconduct of any such Person); and (c) the obligations of any obligor to
the Administrative Agent, the Administrative Agent, the Banks and the Managing
Agents, or any of them, under this Agreement, the Loan Agreement, the Notes and
the other Loan Documents or as a result of making the Loans and any extensions,
renewals or amendments of any of the foregoing, however created, acquired,
arising or evidenced, whether direct or indirect, absolute or contingent, now or
hereafter existing, or due or to become due (except as may arise from the gross
negligence or wilful misconduct of any such Person) (all of the foregoing
obligations (a), (b), and (c) being hereinafter collectively referred to as the
"Obligations"); it being the intention of the parties hereto that beneficial
ownership of the Stock, including, without limitation, all voting, consensual
and dividend rights, shall remain in the Borrower until the occurrence of a
Default (as defined in Section 4 below) under the terms hereof and until the
Administrative Agent shall notify the Borrower of the Administrative Agent's
exercise of voting and dividend rights to the Stock pursuant to Section 9 of
this Agreement.
3. Additional Shares. In the event that, during the term of
this Agreement:
(a) any stock dividend, stock split,
reclassification, readjustment, or other change is declared or made in
the capital structure of any Subsidiary, all new, substituted, and
additional shares, or other securities, issued by reason of any such
change and received by the Borrower or to which the Borrower shall be
entitled shall be promptly delivered to the Administrative Agent,
together with stock powers endorsed in blank by the Borrower, and shall
thereupon constitute Stock to be held by the Administrative Agent under
the terms of this Agreement; and
(b) any subscriptions, warrants or any other rights
or options shall be issued in connection with the Stock, all new stock
or other securities acquired through such subscriptions, warrants,
rights or options by the Borrower shall be promptly delivered to the
Administrative Agent and shall
General Communication, Inc. - Form 8-K
Page 252
thereupon constitute Stock to be held by the Administrative Agent under
the terms of this Agreement.
4. Default. In the event of the occurrence of an Event of
Default under the terms of the Loan Agreement and so long as any such Event of
Default is continuing (any of such occurrences being herein referred to as a
"Default"), subject to Section 13 hereof, the Administrative Agent may sell or
otherwise dispose of the Stock at a public or private sale or make other
commercially reasonable disposition of the Stock or any portion thereof after
ten (10) days' notice to the Borrower and the Administrative Agent, any Bank or
any Managing Agent may purchase the Stock or any portion thereof at any public
sale. The proceeds of the public or private sale or other disposition shall be
applied to the reasonable costs of the Administrative Agent, the Banks and the
Managing Agents incurred in connection with the sale, including, without
limitation, any costs under Section 7(a) hereof. In the event the proceeds of
the sale or other disposition of the Stock are insufficient to satisfy the
Obligations, the Borrower shall remain liable for any such deficiency.
5. Additional Rights of Secured Party. In addition to its
rights and privileges under this Agreement, the Administrative Agent, for itself
and for the ratable benefit of each of the Banks and the Managing Agents, shall
have all the rights, powers and privileges of a secured party under the Uniform
Commercial Code as in effect in any applicable jurisdiction.
6. Return of Stock to the Borrower. Upon payment in full of
all principal and interest on the Notes, full performance by the Borrower of all
covenants, undertakings and obligations under the Loan Agreement, the Notes, and
the other Loan Documents, and satisfaction in full of any other Obligations,
other than the Obligations which survive the termination of the Loan Agreement
as provided in Section 11.18 of the Loan Agreement, the then remaining Stock and
all rights received by the Administrative Agent as a result of its possessory
interest in the Stock shall be returned to the Borrower.
7. Disposition of Stock by Administrative Agent. The Stock is
not registered or qualified under the various Federal or state securities laws
of the United States and disposition thereof after Default may be restricted to
one or more private (instead of public) sales in view of the lack of such
registration. The Borrower understands that upon such disposition, the
Administrative Agent may approach only a restricted number of potential
purchasers and further understands that a sale under such circumstances may
yield a lower price for the Stock than if the Stock was registered and qualified
pursuant to Federal and state securities legislation and sold on the open
market. The Borrower, therefore, agrees that:
(a) if the Administrative Agent shall, pursuant to
the terms of this Agreement, sell or cause the Stock or any portion
thereof to be sold at a private sale, the Administrative Agent shall
have the right to rely upon the advice and opinion of any unaffiliated
national brokerage or investment firm having recognized expertise and
experience in connection with shares of cable companies and other
similar companies (but shall not be obligated to seek such advice and
the failure to do so shall not be considered in determining the
General Communication, Inc. - Form 8-K
Page 253
commercial reasonableness of such action) as to the best manner in
which to expose the Stock for sale and as to the best price reasonably
obtainable at the private sale thereof; and
(b) that such reliance shall be presumptive evidence
that the Administrative Agent has handled such disposition in a
commercially reasonable manner.
8. Borrower's Obligations Absolute. The obligations of the
Borrower under this Agreement shall be direct and immediate and not conditional
or contingent upon the pursuit of any remedies against any other Person, nor
against other security or liens available to the Administrative Agent, the Banks
and the Managing Agents, or any of them, or any of their respective successors,
assigns or agents. The Borrower hereby waives any right to require that an
action be brought against any other Person or to require that resort be had to
any security or to any balance of any deposit account or credit on the books of
the Administrative Agent or any of the Banks or the Managing Agents in favor of
any other Person prior to the exercise of remedies hereunder, or to require
action hereunder prior to resort by the Administrative Agent or any of the Banks
or the Managing Agents to any other security or collateral for the Notes and the
other Obligations.
9. Voting Rights.
(a) For so long as the Notes or any other Obligations
remain unpaid, after and during the continuation of a Default, but
subject to the provisions of Section 13 hereof, (i) the Administrative
Agent may, upon ten (10) days' prior written notice to the Borrower of
its intention to do so, exercise all voting rights, and all other
ownership or consensual rights of the Stock, but under no circumstances
is the Administrative Agent obligated by the terms of this Agreement to
exercise such rights, and (ii) the Borrower hereby appoints the
Administrative Agent, which appointment shall be effective on the 10th
day following the giving of notice by the Administrative Agent as
provided in the foregoing Section 9(a)(i), the Borrower's true and
lawful attorney-in-fact and IRREVOCABLE PROXY to vote the Stock in any
manner the Administrative Agent deems advisable for or against all
matters submitted or which may be submitted to a vote of shareholders.
The power-of-attorney granted hereby is coupled with an interest and
shall be irrevocable so long as any of the Senior Debt remains unpaid
or any of the Banks shall have an obligation to made Advances under the
Loan Agreement.
(b) For so long as the Borrower shall have the right
to vote the Stock, the Borrower covenants and agrees that it will not,
without the prior written consent of the Administrative Agent, vote or
take any consensual action with respect to the Stock which would
constitute a Default.
10. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be given in a manner
prescribed and to the addresses set forth in Section 11.1 of the Loan Agreement.
General Communication, Inc. - Form 8-K
Page 254
11. Governing Law, Etc. The provisions of this Agreement shall
be construed and interpreted, and all rights and obligations of the parties
hereto determined, in accordance with the laws of the State of New York without
reference to the conflicts or choice of law principles thereof. This Agreement,
together with all documents referred to herein and the Loan Agreement,
constitutes the entire agreement between the parties with respect to the matters
addressed herein, and may not be modified except by a writing executed by the
Administrative Agent and the Borrower and delivered by the Administrative Agent
to the Borrower.
12. Severability. If any paragraph or part hereof shall for
any reason be held or adjudged to be invalid, illegal, or unenforceable by any
court of competent jurisdiction, such paragraph or part hereof so adjudicated
invalid, illegal or unenforceable shall be deemed separate, distinct and
independent, and the remainder of this Agreement shall remain in full force and
effect and shall not be affected by such holding or adjudication.
13. FCC Consent. Notwithstanding anything herein which may be
construed to the contrary, no action shall be taken by any of the Administrative
Agent, the Managing Agents or the Banks with respect to the Licenses or any
license of the Federal Communications Commission ("FCC") unless and until all
requirements of Applicable Law, including, without limitation, any required
approval of either of the Alaska Public Utilities Commission or the U.S.
Government (together the "Licensors") and any required approval under the
Federal Communications Act of 1934, and any applicable rules and regulations
thereunder, requiring the consent to or approval of such action by either of the
Licensors, the FCC or any other governmental or other authority, have been
satisfied. The Borrower covenants that upon request of the Administrative Agent
it will cause to be filed such applications and take such other action as may be
requested by such Person or Persons to obtain consent or approval of either of
the Licensors, the FCC or any other governmental or other authority which has
granted any License to the Borrower to any action contemplated by this Agreement
and to give effect to the Security Interest of the Administrative Agent,
including, without limitation, the execution of an application for consent by
the FCC to an assignment or transfer involving a change in ownership or control
pursuant to the provisions of the Federal Communications Act of 1934. To the
extent permitted by Applicable Law, the Administrative Agent is hereby
irrevocably appointed the true and lawful attorney-in-fact of the Borrower, in
its name and stead, to execute and file all necessary applications with the
Licensors, the FCC and with any other governmental or other authority. The power
of attorney granted herein is coupled with an interest and shall be irrevocable
for so long as any of the Obligations remains unpaid or unperformed or any of
the Banks have any obligation to make Advances under the Loan Agreement,
regardless of whether the conditions precedent to the making of any such
Advances has been or can be fulfilled.
14. Administrative Agent. Each reference herein to any right
granted to, benefit conferred upon, or power exercisable by the "Administrative
Agent" shall be a reference to the Administrative Agent (including any
successors to the Administrative Agent pursuant to the Loan Agreement) for
itself and for the ratable benefit of the Managing Agents and the Banks, and
each action taken or right exercised hereunder shall be deemed to have been so
taken or exercised by the Administrative Agent for
General Communication, Inc. - Form 8-K
Page 255
itself and for the benefit of and on behalf of all of the Managing Agents and
the Banks.
15. Benefit of Assignment. This assignment and the rights
hereunder shall inure to the benefit of the Administrative Agent, the Banks and
the Managing Agents, and may be assigned in whole or in part by the
Administrative Agent, the Banks and the Managing Agents in connection with any
assignment of the Loan Agreement or the Indebtedness evidenced thereby, as is
permitted thereunder, and shall be binding upon each Partner and its respective
successors and assigns.
16. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
17. Pledge of Additional Securities. Pursuant to the Loan
Agreement, the Borrower agrees to assign and grant security title to, and a
security interest in, any debt or equity securities acquired by the Borrower
after the date hereof. The Borrower agrees to execute, deliver and record any
amendments hereto, documents, instruments, stock powers and financing
statements, deemed by the Administrative Agent to be necessary or appropriate,
to create or perfect the security interest described in the foregoing sentence.
[the remainder of this page is intentionally blank]
General Communication, Inc. - Form 8-K
Page 256
IN WITNESS WHEREOF, the undersigned parties hereto have executed this
Agreement by and through their duly authorized officers, as of the day and year
first above written.
BORROWER: GCI CABLE, INC., an Alaska
corporation
By: /s/ John M. Lowber
Title: Secretary/Treasurer
ADMINISTRATIVE AGENT: TORONTO DOMINION (TEXAS), INC.
By: /s/ Jano Mott
Title: Vice President
General Communication, Inc. - Form 8-K
Page 257
EXHIBIT D
FORM OF REVOLVING PROMISSORY NOTE
U.S.$ October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of
(hereinafter, together with its successors and
assigns called the "Bank"), at such place as the Bank may designate in writing
to the Borrower, in immediately available funds, the principal sum of
AND /100's DOLLARS ($ ) of United
States funds, or, if less, so much thereof as may from time to time be advanced
by the Bank to the Borrower hereunder, plus interest as hereinafter provided.
Such Advances shall be endorsed from time to time on the grid attached hereto,
but the failure to make such notations shall not affect the validity of the
Borrower's obligation to repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Loan
Agreement of even date herewith among the Borrower, the Banks, the Managing
Agents and Toronto Dominion (Texas), Inc. (the "Administrative Agent"), as
administrative agent for the Managing Agents and the Banks (as amended,
supplemented or otherwise modified from time to time, the "Loan Agreement"). All
capitalized terms used herein shall have the meanings ascribed to such terms in
the Loan Agreement, except to the extent such capitalized terms are otherwise
defined or limited herein.
The Borrower shall repay principal outstanding hereunder from time to
time as set forth in the Loan Agreement. In addition, all remaining principal
amounts and other Obligations then outstanding hereunder shall be due and
payable on the Maturity Date.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such payment is inadvertently made by the Borrower or inadvertently received
by the Bank, then such excess sum shall be credited as a payment of principal,
unless the
General Communication, Inc. - Form 8-K
Page 258
Borrower shall notify the Bank in writing that it elects to have such excess sum
returned forthwith. It is the express intent hereof that the Borrower not pay
and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 259
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By:
Its:
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 260
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 261
REVOLVING PROMISSORY NOTE
U.S.$31,250,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of TORONTO DOMINION
(TEXAS), INC. (hereinafter, together with its successors and assigns called the
"Bank"), at such place as the Bank may designate in writing to the Borrower, in
immediately available funds, the principal sum of THIRTY ONE MILLION TWO HUNDRED
FIFTY THOUSAND AND 00/100's DOLLARS ($31,250,000.00) of United States funds, or,
if less, so much thereof as may from time to time be advanced by the Bank to the
Borrower hereunder, plus interest as hereinafter provided. Such Advances shall
be endorsed from time to time on the grid attached hereto, but the failure to
make such notations shall not affect the validity of the Borrower's obligation
to repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such
General Communication, Inc. - Form 8-K
Page 262
payment is inadvertently made by the Borrower or inadvertently received by the
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 263
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary-Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 264
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 265
REVOLVING PROMISSORY NOTE
U.S.$31,250,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of NATIONSBANK OF
TEXAS, N.A. (hereinafter, together with its successors and assigns called the
"Bank"), at such place as the Bank may designate in writing to the Borrower, in
immediately available funds, the principal sum of THIRTY ONE MILLION TWO HUNDRED
FIFTY THOUSAND AND 00/100's DOLLARS ($31,250,000.00) of United States funds, or,
if less, so much thereof as may from time to time be advanced by the Bank to the
Borrower hereunder, plus interest as hereinafter provided. Such Advances shall
be endorsed from time to time on the grid attached hereto, but the failure to
make such notations shall not affect the validity of the Borrower's obligation
to repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such
General Communication, Inc. - Form 8-K
Page 266
payment is inadvertently made by the Borrower or inadvertently received by the
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 267
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By:
Its:
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 268
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 269
REVOLVING PROMISSORY NOTE
U.S.$31,250,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of CREDIT LYONNAIS
NEW YORK BRANCH (hereinafter, together with its successors and assigns called
the "Bank"), at such place as the Bank may designate in writing to the Borrower,
in immediately available funds, the principal sum of THIRTY ONE MILLION TWO
HUNDRED FIFTY THOUSAND AND 00/100's DOLLARS ($31,250,000.00) of United States
funds, or, if less, so much thereof as may from time to time be advanced by the
Bank to the Borrower hereunder, plus interest as hereinafter provided. Such
Advances shall be endorsed from time to time on the grid attached hereto, but
the failure to make such notations shall not affect the validity of the
Borrower's obligation to repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such
General Communication, Inc. - Form 8-K
Page 270
payment is inadvertently made by the Borrower or inadvertently received by the
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 271
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 272
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 273
REVOLVING PROMISSORY NOTE
U.S.$31,250,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of THE CHASE
MANHATTAN BANK N.A. (hereinafter, together with its successors and assigns
called the "Bank"), at such place as the Bank may designate in writing to the
Borrower, in immediately available funds, the principal sum of THIRTY ONE
MILLION TWO HUNDRED FIFTY THOUSAND AND 00/100's DOLLARS ($31,250,000.00) of
United States funds, or, if less, so much thereof as may from time to time be
advanced by the Bank to the Borrower hereunder, plus interest as hereinafter
provided. Such Advances shall be endorsed from time to time on the grid attached
hereto, but the failure to make such notations shall not affect the validity of
the Borrower's obligation to repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such
General Communication, Inc. - Form 8-K
Page 274
payment is inadvertently made by the Borrower or inadvertently received by the
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 275
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 276
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 277
REVOLVING PROMISSORY NOTE
U.S.$25,000,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of THE BANK OF NEW
YORK (hereinafter, together with its successors and assigns called the "Bank"),
at such place as the Bank may designate in writing to the Borrower, in
immediately available funds, the principal sum of TWENTY FIVE MILLION AND
00/100's DOLLARS ($25,000,000.00) of United States funds, or, if less, so much
thereof as may from time to time be advanced by the Bank to the Borrower
hereunder, plus interest as hereinafter provided. Such Advances shall be
endorsed from time to time on the grid attached hereto, but the failure to make
such notations shall not affect the validity of the Borrower's obligation to
repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such payment is inadvertently made by the Borrower or inadvertently received
by the
General Communication, Inc. - Form 8-K
Page 278
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 279
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 280
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 281
REVOLVING PROMISSORY NOTE
U.S.$25,000,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of BANQUE PARIBAS
(hereinafter, together with its successors and assigns called the "Bank"), at
such place as the Bank may designate in writing to the Borrower, in immediately
available funds, the principal sum of TWENTY FIVE MILLION AND 00/100's DOLLARS
($25,000,000.00) of United States funds, or, if less, so much thereof as may
from time to time be advanced by the Bank to the Borrower hereunder, plus
interest as hereinafter provided. Such Advances shall be endorsed from time to
time on the grid attached hereto, but the failure to make such notations shall
not affect the validity of the Borrower's obligation to repay unpaid principal
and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such payment is inadvertently made by the Borrower or inadvertently received
by the
General Communication, Inc. - Form 8-K
Page 282
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 283
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 284
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 285
REVOLVING PROMISSORY NOTE
U.S.$15,000,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of THE FIRST NATIONAL
BANK OF MARYLAND (hereinafter, together with its successors and assigns called
the "Bank"), at such place as the Bank may designate in writing to the Borrower,
in immediately available funds, the principal sum of FIFTEEN MILLION AND
00/100's DOLLARS ($15,000,000.00) of United States funds, or, if less, so much
thereof as may from time to time be advanced by the Bank to the Borrower
hereunder, plus interest as hereinafter provided. Such Advances shall be
endorsed from time to time on the grid attached hereto, but the failure to make
such notations shall not affect the validity of the Borrower's obligation to
repay unpaid principal and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such
General Communication, Inc. - Form 8-K
Page 286
payment is inadvertently made by the Borrower or inadvertently received by the
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 287
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 288
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 289
REVOLVING PROMISSORY NOTE
U.S.$15,000,000.00 October 31, 1996
FOR VALUE RECEIVED, the undersigned, GCI CABLE, INC., an Alaska
corporation (the "Borrower"), promises to pay to the order of PNC BANK, National
Association (hereinafter, together with its successors and assigns called the
"Bank"), at such place as the Bank may designate in writing to the Borrower, in
immediately available funds, the principal sum of FIFTEEN MILLION AND 00/100's
DOLLARS ($15,000,000.00) of United States funds, or, if less, so much thereof as
may from time to time be advanced by the Bank to the Borrower hereunder, plus
interest as hereinafter provided. Such Advances shall be endorsed from time to
time on the grid attached hereto, but the failure to make such notations shall
not affect the validity of the Borrower's obligation to repay unpaid principal
and interest hereunder.
This Note is one of the Notes referred to in that certain Second
Amended and Restated Loan Agreement of even date herewith among the Borrower,
the Banks, the Managing Agents and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent") (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement"). All capitalized terms used herein shall have the meanings
ascribed to such terms in the Loan Agreement, except to the extent such
capitalized terms are otherwise defined or limited herein.
All principal amounts and other Obligations then outstanding hereunder
shall be due and payable on the Maturity Date.
In addition, the Borrower shall repay principal outstanding hereunder
from time to time as set forth in the Loan Agreement.
Prior to the Maturity Date, the Borrower shall be entitled to borrow,
re-pay and re-borrow funds hereunder pursuant to the terms and conditions of the
Loan Agreement. Prepayment of the principal amount of any Loan may be made only
as provided in the Loan Agreement.
The Borrower hereby promises to pay interest on the unpaid principal
amount hereof as provided in Article 2 of the Loan Agreement. Interest under
this Note shall also be due and payable when this Note shall become due (whether
at maturity, by reason of acceleration or otherwise). Overdue principal and, to
the extent permitted by law, overdue interest, shall bear interest at a rate per
annum equal to the Default Rate and shall be payable in the manner provided in
the Loan Agreement.
In no event shall the amount of interest due or payable hereunder
exceed the maximum rate of interest allowed by applicable law, and in the event
any such payment is inadvertently made by the Borrower or inadvertently received
by the
General Communication, Inc. - Form 8-K
Page 290
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify the Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that the Borrower not
pay and the Bank not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law.
Except as otherwise expressly provided in any of the Loan Documents,
all parties now or hereafter liable with respect to this Note, whether the
Borrower, any guarantor, endorser, or any other Person hereby waive presentment
for payment, demand, notice of non-payment or dishonor, protest, notice of
protest and notice of any other kind whatsoever.
No delay or omission on the part of the Bank or any holder hereof in
exercising its rights under this Note, or delay or omission on the part of the
Bank, the Administrative Agent, the Majority Banks or the Banks collectively, or
any of them, in exercising its or their rights under the Loan Agreement or under
any other Loan Document, or course of conduct relating thereto, shall operate as
a waiver of such rights or any other right of the Bank or any holder hereof, nor
shall any waiver by the Bank or any holder hereof, the Administrative Agent, the
Majority Banks or the Banks collectively, or any of them, of any such right or
rights on any one occasion be deemed a bar to, or waiver of, the same right or
rights on any future occasion.
The Borrower promises to pay all reasonable costs of collection,
including reasonable attorneys' fees, should this Note be collected by or
through an attorney-at-law or under advice therefrom.
Time is of the essence of this Note.
This Note evidences the Bank's portion of the Loans under, and is
entitled to the benefits and subject to the terms of, the Loan Agreement, which
contains provisions with respect to the acceleration of the maturity of this
Note upon the happening of certain stated events, and provisions for prepayment.
This Note is secured by and is also entitled to the benefits of the Loan
Documents and any other agreement or instrument providing collateral for the
Loans, whether now or hereafter in existence.
This Note shall be construed in accordance with and governed by the
laws of the State of New York without reference to the conflicts or choice of
law principles thereof.
General Communication, Inc. - Form 8-K
Page 291
IN WITNESS WHEREOF, the duly authorized officers of the Borrower, as
Authorized Signatories, have executed this Note, as of the day and year first
above written.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 292
ADVANCES
Amount of
Principal
Amount of Type of Paid or Notation
Date Advance Advance Prepaid Made By
General Communication, Inc. - Form 8-K
Page 293
EXHIBIT E
FORM OF PARENT'S PLEDGE AGREEMENT
THIS PARENT'S PLEDGE AGREEMENT (the "Agreement"), is entered into as of
this 31st day of October, 1996 by General Communication, Inc., an Alaska
corporation (the "Pledgor") in favor of Toronto Dominion (Texas), Inc., as
administrative agent and on behalf of the Managing Agents and the Banks (the
"Administrative Agent").
W I T N E S S E T H:
WHEREAS, GCI Cable, Inc., an Alaska corporation (the "Borrower"), the
Administrative Agent, the Managing Agents and the Banks have entered into that
certain Loan Agreement dated as of October 31, 1996 (as amended, modified or
supplemented from time to time, the "Loan Agreement") pursuant to which the
Banks have agreed to make loans (the "Loans") to the Borrower; and
WHEREAS, the Pledgor has determined that the Borrower's making of the
Loan will be of direct or indirect benefit to the Pledgor because the Pledgor is
owner of one hundred percent (100%) of the issued and outstanding capital stock
of the Borrower; and
WHEREAS, to secure the payment and performance of, among other things,
the obligations of the Borrower under the Loan Agreement, the promissory notes
issued by the Borrower to the Banks thereunder (as they may be modified, amended
or replaced, the "Notes") and the other Loan Documents, the Pledgor, the
Administrative Agent, the Banks and the Managing Agents have agreed that the
shares of capital stock (the "Stock") owned by the Pledgor in the Borrower,
shall be pledged by the Pledgor to the Administrative Agent to secure the
Obligations (as defined below);
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree that capitalized terms used herein
shall have the meanings ascribed to them in the Loan Agreement to the extent not
otherwise defined or limited herein, and further agree as follows:
1. Warranty. The Pledgor hereby represents and warrants to the
Administrative Agent, the Banks and the Managing Agents, that except for the
security interest created hereby, the Pledgor owns the Stock, which is all of
the issued and outstanding stock of the Borrower, free and clear of all Liens,
that the Stock is duly issued, fully paid and non-assessable, and that the
Pledgor has the unencumbered right to pledge the Stock.
General Communication, Inc. - Form 8-K
Page 294
2. Security Interest. The Pledgor hereby unconditionally
grants and assigns to the Administrative Agent, for itself and on behalf of the
Banks and the Managing Agents, and their respective successors and assigns, a
continuing security interest in and security title to the Stock. The Pledgor has
delivered to and deposited with the Administrative Agent herewith all of its
right, title and interest in and to the Stock, together with certificates
representing the Stock, and stock powers endorsed in blank, as security for
payment and performance of all obligations to the Administrative Agent, the
Banks and the Managing Agents, or any of them, of the Borrower under the Loan
Agreement, Notes and all other Loan Documents, however created, acquired,
arising or evidenced, whether direct or indirect, absolute or contingent, now or
hereafter existing, or due or to become due (all of the foregoing obligations
being hereinafter collectively referred to as the "Obligations"); it being the
intention of the parties hereto that beneficial ownership of the Stock,
including, without limitation, all voting, consensual and dividend rights, shall
remain in the Pledgor until the occurrence of a Default under the terms hereof
(as defined in Section 4 below) and until the Administrative Agent shall notify
the Pledgor of the Administrative Agent's exercise of voting and dividend rights
to the Stock pursuant to Section 9 of this Agreement.
3. Additional Shares. In the event that, during the term of
this Agreement:
(a) any stock dividend, stock split,
reclassification, readjustment, or other change is declared or made in
the capital structure of the Borrower, all new, substituted, and
additional shares, or other securities, issued by reason of any such
change and received by the Pledgor or to which the Pledgor shall be
entitled shall be promptly delivered to the Administrative Agent,
together with stock powers endorsed in blank by the Pledgor, and shall
thereupon constitute Stock to be held by the Administrative Agent under
the terms of this Agreement; and
(b) any subscriptions, warrants or any other rights
or options shall be issued in connection with the Stock, all new stock
or other securities acquired through such subscriptions, warrants,
rights or options by the Pledgor shall be promptly delivered to the
Administrative Agent and shall thereupon constitute Stock to be held by
the Administrative Agent under the terms of this Agreement.
4. Default. In the event of the occurrence of an Event of
Default under the terms of the Loan Agreement and so long as any such Event of
Default is continuing (any of such occurrences being herein referred to as a
"Default"), subject to Section 13 hereof, the Administrative Agent may sell or
otherwise dispose of the Stock at a public or private sale or make other
commercially reasonable disposition of the Stock or any portion thereof after
ten (10) days' notice to the Pledgor, and the Administrative Agent, any Bank or
any Managing Agent may purchase the Stock or any portion thereof at any public
sale. The proceeds of the public or private sale or other disposition shall be
applied to the reasonable costs of the Administrative Agent, the Banks and the
Managing Agents incurred in connection with the sale, including, without
limitation, any costs under Section 7(a) hereof.
General Communication, Inc. - Form 8-K
Page 295
5. Additional Rights of Secured Party. In addition to its
rights and privileges under this Agreement, the Administrative Agent, for itself
and for the ratable benefit of each of the Banks and the Managing Agents shall
have all the rights, powers and privileges of a secured party under the Uniform
Commercial Code as in effect in any applicable jurisdiction.
6. Return of Stock to the Pledgor. Upon payment in full of all
principal and interest on the Notes, full performance by the Borrower of all
covenants, undertakings and obligations under the Loan Agreement, the Notes and
the other Loan Documents, and satisfaction in full of any other Obligations,
other than the Obligations which survive the termination of the Loan Agreement
as provided in Section 11.18 of the Loan Agreement, the then remaining Stock and
all rights received by the Administrative Agent as a result of its possessory
interest in the Stock shall be returned to the Pledgor.
7. Disposition of Stock by Administrative Agent. The Stock is
not registered or qualified under the various Federal or state securities laws
of the United States and disposition thereof after Default may be restricted to
one or more private (instead of public) sales in view of the lack of such
registration. The Pledgor understands that upon such disposition, the
Administrative Agent may approach only a restricted number of potential
purchasers and further understands that a sale under such circumstances may
yield a lower price for the Stock than if the Stock was registered and qualified
pursuant to Federal and state securities legislation and sold on the open
market. The Pledgor, therefore, agrees that:
(a) if the Administrative Agent shall, pursuant to
the terms of this Agreement, sell or cause the Stock or any portion
thereof to be sold at a private sale, the Administrative Agent shall
have the right to rely upon the advice and opinion of any unaffiliated
national brokerage or investment firm having recognized expertise and
experience in connection with shares of cable companies and other
similar companies (but shall not be obligated to seek such advice and
the failure to do so shall not be considered in determining the
commercial reasonableness of such action) as to the best manner in
which to expose the Stock for sale and as to the best price reasonably
obtainable at the private sale thereof; and
(b) that such reliance shall be presumptive evidence
that the Administrative Agent has handled such disposition in a
commercially reasonable manner.
8. Pledgor's Obligations Absolute. The obligations of the
Pledgor under this Agreement shall be direct and immediate and not conditional
or contingent upon the pursuit of any remedies against the Borrower or any other
Person, nor against other security or liens available to the Administrative
Agent, the Banks and the Managing Agents, or any of them, or any of their
respective successors, assigns or agents. The Pledgor hereby waives any right to
require that an action be brought against any other Person or to require that
resort be had to any security or to any balance of any deposit account or credit
on the books of the Administrative Agent or any of the Banks or the Managing
Agents in favor of any other Person prior to the
General Communication, Inc. - Form 8-K
Page 296
exercise of remedies hereunder, or to require action hereunder prior to resort
by the Administrative Agent or any of the Banks or the Managing Agents to any
other security or collateral for the Notes and the other Obligations.
9. Voting Rights.
(a) For so long as the Notes or any other Obligations
remain unpaid, after and during the continuation of a Default, but
subject to the provisions of Section 13 hereof, (i) the Administrative
Agent may, upon ten (10) days' prior written notice to the Pledgor of
its intention to do so, exercise all voting rights, and all other
ownership or consensual rights of the Stock, but under no circumstances
is the Administrative Agent obligated by the terms of this Agreement to
exercise such rights, and (ii) the Pledgor hereby appoints the
Administrative Agent, which appointment shall be effective on the 10th
day following the giving of notice by the Administrative Agent as
provided in the foregoing Section 9(a)(i), the Pledgor's true and
lawful attorney-in-fact and IRREVOCABLE PROXY to vote the Stock in any
manner the Administrative Agent deems advisable for or against all
matters submitted or which may be submitted to a vote of shareholders.
The power-of-attorney granted hereby is coupled with an interest and
shall be irrevocable so long as any of the Senior Debt remains unpaid
or any of the Banks shall have an obligation to make Advances under the
Loan Agreement.
(b) For so long as the Pledgor shall have the right
to vote the Stock, the Pledgor covenants and agrees that it will not,
without the prior written consent of the Administrative Agent, vote or
take any consensual action with respect to the Stock which would
constitute a Default.
10. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be given in a manner
prescribed and to the addresses set forth in Section 11.1 of the Loan Agreement,
and with respect to the Pledgor at the address set forth on the signature page
hereof.
11. Governing Law, Etc.. The provisions of this Agreement
shall be construed and interpreted, and all rights and obligations of the
parties hereto determined, in accordance with the laws of the State of New York
without reference to the conflicts or choice of law principles thereof. This
Agreement, together with all documents referred to herein and the Loan
Agreement, constitutes the entire Agreement between the parties with respect to
the matters addressed herein, and may not be modified except by a writing
executed by the Administrative Agent and the Pledgor and delivered by the
Administrative Agent to the Pledgor.
12. Severability. If any paragraph or part hereof shall for
any reason be held or adjudged to be invalid, illegal or unenforceable by any
court of competent jurisdiction, such paragraph or part hereof so adjudicated
invalid, illegal or unenforceable shall be deemed separate, distinct and
independent, and the remainder of this Agreement shall remain in full force and
effect and shall not be affected by such holding or adjudication.
General Communication, Inc. - Form 8-K
Page 297
13. FCC Consent. Notwithstanding anything herein which may be
construed to the contrary, no action shall be taken by any of the Administrative
Agent, the Managing Agents or the Banks with respect to the Licenses or any
license of the Federal Communications Commission ("FCC") unless and until all
requirements of Applicable Law, including, without limitation, any required
approval of either of the Alaska Public Utilities Commission or the U.S.
Government (together the "Licensors") and any required approval under the
Federal Communications Act of 1934, and any applicable rules and regulations
thereunder, requiring the consent to or approval of such action by either of the
Licensors, the FCC or any other governmental or other authority, have been
satisfied. The Pledgor covenants that upon request of the Administrative Agent
it will cause to be filed such applications and take such other action as may be
requested by such Person or Persons to obtain consent or approval of either of
the Licensors, the FCC or any other governmental or other authority which has
granted any License to the Pledgor to any action contemplated by this Agreement
and to give effect to the Security Interest of the Administrative Agent,
including, without limitation, the execution of an application for consent by
the FCC to an assignment or transfer involving a change in ownership or control
pursuant to the provisions of the Federal Communications Act of 1934. To the
extent permitted by Applicable Law, the Administrative Agent is hereby
irrevocably appointed the true and lawful attorney-in-fact of the Pledgor, in
its name and stead, to execute and file all necessary applications with the
Licensors, the FCC and with any other governmental or other authority. The power
of attorney granted herein is coupled with an interest and shall be irrevocable
for so long as any of the Obligations remains unpaid or unperformed or any of
the Banks have any obligation to make Advances under the Loan Agreement,
regardless of whether the conditions precedent to the making of any such
Advances has been or can be fulfilled.
14. Administrative Agent. Each reference herein to any right
granted to, benefit conferred upon, or power exercisable by the "Administrative
Agent" shall be a reference to the Administrative Agent (including any
successors to the Administrative Agent pursuant to the Loan Agreement) for
itself and for the ratable benefit of the Managing Agents and the Banks, and
each action taken or right exercised hereunder shall be deemed to have been so
taken or exercised by the Administrative Agent for itself and for the benefit of
and on behalf of all of the Managing Agents and the Banks.
15. Benefit of Assignment. This assignment and the rights
hereunder shall inure to the benefit of the Administrative Agent, the Banks and
the Managing Agents, and may be assigned in whole or in part by the
Administrative Agent, the Banks and the Managing Agents in connection with any
assignment of the Loan Agreement or the Indebtedness evidenced thereby, as is
permitted thereunder, and shall be binding upon each Partner and its respective
successors and assigns.
16. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
17. Pledge of Additional Securities. Pursuant to the Loan
Agreement, the Pledgor agrees to assign and grant security title to, and a
security interest in, any debt
General Communication, Inc. - Form 8-K
Page 298
or equity securities in the Borrower acquired by the Pledgor after the date
hereof. The Pledgor agrees to execute, deliver and record any amendments hereto,
documents, instruments, stock powers and financing statements, deemed by the
Administrative Agent to be necessary or appropriate, to create or perfect the
security interest described in the foregoing sentence.
18. Nonrecourse Obligations. Except to the extent of any
representation, warranty, covenant or undertaking made specifically by the
Pledgor herein or in any other Loan Document, the Pledgor shall have no personal
liability under this Agreement or any other Loan Document, anything to the
contrary herein or therein notwithstanding.
[the remainder of this page is intentionally blank]
General Communication, Inc. - Form 8-K
Page 299
IN WITNESS WHEREOF, the undersigned parties hereto have executed this
Agreement by and through their duly authorized officers, as of the day and year
first above written.
PLEDGOR: GENERAL COMMUNICATION, INC., an
Alaska corporation
By: /s/ John M. Lowber
Title: Vice President
Address:
ADMINISTRATIVE AGENT: TORONTO DOMINION (TEXAS), INC.
By: /s/ Jano Mott
Title: Vice President
General Communication, Inc. - Form 8-K
Page 300
EXHIBIT F-1
FORM OF REQUEST FOR ADVANCE
I, , the of GCI Cable,
Inc., an Alaska corporation (the "Borrower") and an Authorized Signatory
thereof, hereby certify, pursuant to the provisions of that certain Loan
Agreement (as amended, supplemented or modified from time to time, the "Loan
Agreement") dated as of October 31, 1996, by and among the Borrower; Toronto
Dominion (Texas), Inc. Credit Lyonnais, Cayman Island Branch, NationsBank of
Texas, N.A. and The Chase Manhattan Bank, N.A., as Managing Agents (collectively
the "Managing Agents"); the financial institutions party thereto (the "Banks")
and Toronto Dominion (Texas), Inc. (the "Administrative Agent"), as
administrative agent for the Managing Agents and the Banks, that:
1. The Borrower hereby requests [a Base Rate Advance in the
amount of $ / a Eurodollar Advance in the amount of
$ with an Interest Period of ] to be made under the
Commitment on , 199 . The proceeds of the Advance should be wired as
set forth on Schedule 1 attached hereto. The foregoing instructions shall be
irrevocable.
2. All representations and warranties of the Borrower made
under the Loan Agreement, which in accordance with Section 4.2 of the Loan
Agreement are made at and as of the time of such Advance, are true and correct
in all material respects as of the date hereof, both before and after giving
effect to the application of the proceeds of the Advance in connection with
which this Request is given, except to the extent such representations and
warranties (a) relate expressly to an earlier date, (b) have been previously
fulfilled in accordance with the terms of the Loan Agreement, (c) have
subsequently become inapplicable, or (d) have been modified as a result of
activities of the Borrower or changes in circumstances in any case as permitted
under the Loan Agreement or as consented to or waived in writing in accordance
with Section 11.13 of the Loan Agreement.
3. The incumbency of Persons authorized by the Borrower to
sign documents is as stated in the certificate delivered pursuant to Section 3.1
of the Loan Agreement.
4. There does not exist, as of this date, and after giving
effect to the Advance requested in this Request, any Default under the Loan
Agreement.
5. All Necessary Authorizations have been obtained or made,
are in full force and effect and are not subject to any pending or threatened
reversal or cancellation.
General Communication, Inc. - Form 8-K
Page 301
Capitalized terms used in this Request and not otherwise defined are
used as defined in the Loan Agreement.
Done as of the day of , 199 .
GCI CABLE, INC., an Alaska corporation
By:
Its:
Schedule 1 - Wiring Instructions
General Communication, Inc. - Form 8-K
Page 302
EXHIBIT F-2
FORM OF REQUEST FOR INITIAL ADVANCE
I, , the of GCI Cable,
Inc., an Alaska corporation (the "Borrower") and an Authorized Signatory
thereof, hereby certify, pursuant to the provisions of that certain Loan
Agreement (as amended, supplemented or modified from time to time, the "Loan
Agreement") dated as of October 31, 1996, by and among the Borrower; Toronto
Dominion (Texas), Inc., Credit Lyonnais, New York Branch, NationsBank of Texas,
N.A. and The Chase Manhattan Bank, N.A., as Managing Agents (collectively the
"Managing Agents"); the financial institutions party thereto (the "Banks") and
Toronto Dominion (Texas), Inc. (the "Administrative Agent"), as administrative
agent for the Managing Agents and the Banks, that:
1. The Borrower hereby requests a Base Rate Advance in the
amount of $157,700,000.00 to be made under the Commitment on October 31, 1996.
The proceeds of such Advances will be used (i) in part to pay the loans
outstanding under the Prior Loan Agreement, (ii) in part to pay the fees due
under the Loan Agreement on the date hereof, (iii) to finance the Cooke
Acquisition, and (iv) the remainder should be wired as set forth on Schedule 1
attached hereto. The foregoing instructions shall be irrevocable.
2. All representations and warranties of the Borrower made
under the Loan Agreement, which in accordance with Section 4.2 of the Loan
Agreement are made at and as of the time of such Advance, are true and correct
in all material respects as of the date hereof, both before and after giving
effect to the application of the proceeds of the Advance in connection with
which this Request is given, except to the extent such representations and
warranties (a) relate expressly to an earlier date, (b) have been previously
fulfilled in accordance with the terms of the Loan Agreement, (c) have
subsequently become inapplicable, or (d) have been modified as a result of
activities of the Borrower or changes in circumstances in any case as permitted
under the Loan Agreement or as consented to or waived in writing in accordance
with Section 11.13 of the Loan Agreement.
3. The incumbency of Persons authorized by the Borrower to
sign documents is as stated in the certificate delivered pursuant to Section 3.1
of the Loan Agreement.
4. There does not exist, as of this date, and after giving
effect to the Advance requested in this Request, any Default under the Loan
Agreement.
5. All Necessary Authorizations have been obtained or made,
are in full force and effect and are not subject to any pending or threatened
reversal or cancellation.
General Communication, Inc. - Form 8-K
Page 303
6. Attached to this Request as Schedule 2 are the calculations
(i) required to establish the Applicable Margin, and (ii) reflecting the
Borrower's compliance with Sections 7.8, 7.9 and 7.10 of the Loan Agreement.
Capitalized terms used in this Request and not otherwise defined are
used as defined in the Loan Agreement.
Done as of the 31st day of October, 1996.
GCI CABLE, INC., an Alaska corporation
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Schedule 1 - Wiring Instructions
Schedule 2 - Compliance Calculations
General Communication, Inc. - Form 8-K
Page 304
EXHIBIT G
FORM OF REQUEST FOR ISSUANCE OF LETTER OF CREDIT
I, , the of GCI Cable, Inc., an Alaska
corporation (the "Borrower") and an Authorized Signatory thereof, do hereby
certify pursuant to the provisions of that certain Loan Agreement (as amended
from time to time, the "Loan Agreement"), dated as of October 31, 1996, by and
among the Borrower, the Bank signatories thereto (the "Banks"), Toronto Dominion
(Texas), Inc. Credit Lyonnais, Cayman Island Branch, NationsBank of Texas, N.A.
and The Chase Manhattan Bank, N.A. (the "Managing Agents") and Toronto Dominion
(Texas), Inc., (the "Administrative Agent"), as administrative agent for the
Managing Agents and the Banks, that:
1. The Borrower hereby requests that The
Toronto-Dominion Bank issue a Letter of Credit under the Letter of
Credit Commitment in the face amount of U.S. $ to be issued
on , 199 , for the benefit of (the
"Beneficiary"), in the form attached hereto as Exhibit A, to expire on
, 199 (the "Expiration Date"). The face amount of such
Letter of Credit is not less than $50,000, and does not exceed the
remaining amount available under the Loan Agreement for the issuance of
Letters of Credit.
2. The Letter of Credit requested hereby is for the
following purpose:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
3. All representations and warranties made in the
Loan Agreement and the other Loan Documents, which in accordance with
Section 4.2 of the Loan Agreement are made at and as of the time of
issuance of each Letter of Credit, are true and correct in all material
respects as of the date hereof, both before and after giving effect to
the issuance of the Letter of Credit in connection with which this
Request is given, except to the extent such representations and
warranties (a) relate expressly to an earlier date, (b) have been
previously fulfilled in accordance with the terms of the Loan
Agreement, (c) have subsequently become inapplicable, or (d) have been
modified as a result of activities of the Borrower or changes in
circumstances in any case as permitted under the Loan Agreement or as
consented to or waived in writing in accordance with Section 11.13 of
the Loan Agreement.
General Communication, Inc. - Form 8-K
Page 305
4. The incumbency of persons authorized by the
Borrower to sign documents is as stated in the certificate of
incumbency most recently delivered to the Administrative Agent, the
Managing Agents and each of the Banks.
5. There does not exist, as of this date, and after
giving effect to the issuance of the Letter of Credit requested hereby,
any Default.
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
Dated as of this day of , 199 .
GCI CABLE, INC., an Alaska corporation
By:
Title:
Exhibit A - Form of Letter of Credit
General Communication, Inc. - Form 8-K
Page 306
EXHIBIT H
FORM OF SECURITY AGREEMENT
THIS SECURITY AGREEMENT (the "Agreement"), is entered into as of this
31st day of October, 1996, by and between GCI Cable, Inc., an Alaska corporation
(the "Borrower"), and Toronto Dominion (Texas), Inc. (the "Administrative
Agent"), as administrative agent for the Managing Agents and the Banks.
W I T N E S S E T H :
WHEREAS, the Borrower, the Administrative Agent, the Managing Agents
and the Banks have entered into that certain Loan Agreement dated as of October
31, 1996 (as amended, supplemented or otherwise modified from time to time, the
"Loan Agreement") pursuant to which the Banks have agreed to make loans (the
"Loans") to the Borrower, which Loans are evidenced by the promissory notes of
the Borrower in favor of each Bank (as amended, modified, renewed or extended
from time to time, the "Notes"); and
WHEREAS, to secure the due and punctual payment and performance of the
Obligations, the Borrower has entered into this Agreement;
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto hereby agree that all capitalized terms
used herein shall have the meanings ascribed to such terms in the Loan Agreement
to the extent not otherwise defined or limited herein, and further agree as
follows:
1. Security Interest. The Borrower hereby grants, conveys,
transfers and assigns to the Administrative Agent, for the ratable benefit of
the Banks, a continuing security interest in and security title to (hereinafter
referred to as the "Security Interest") all of its property, whether now owned
or hereafter created, acquired, or reacquired, including, without limitation,
the property described below and all substitutions therefor, accessions thereto,
and improvements thereon:
Inventory. All of the Borrower's inventory of whatever nature
and kind and wherever situated, including, without limitation,
converters, coaxial cables and hardware, raw materials, components,
work in process, finished goods, goods in transit, and packing and
shipping materials, accretions and accessions thereto, and trust
receipts and similar documents covering the same products (the
"Inventory");
General Communication, Inc. - Form 8-K
Page 307
Equipment. All machinery and equipment not included in
Inventory above, including, without limitation, motor vehicles and all
accretions and accessions thereto; CATV towers, antennas, and equipment
located at head-end facilities; distribution systems consisting of pole
hardware, strand, coaxial cables, electronic amplifiers, associated
passive devices and subscriber service drops incident to normal CATV
service; test equipment; all equipment used in the specialized mobile
radio business; and closed circuit program origination equipment (the
"Equipment");
Accounts. All right to payment for goods sold or leased or for
services rendered, including, without limitation, the provision of
cable television services, which is not evidenced by an instrument or
chattel paper, whether or not it has been earned by performance,
including, without limitation, all agreements with subscribers, and all
books and records recording, evidencing, or relating to such accounts
or any part thereof (the "Accounts");
Contracts and Leases. To the extent that the Borrower may
grant a security interest therein without violating a valid and
enforceable restriction on the granting of a security interest
contained therein:
(a) All construction contracts, Pole
Agreements, and public utility contracts to which the Borrower
is a party, whether now existing or hereafter arising (the
"Contracts");
(b) all lease agreements for real
property or personal property to which the Borrower is a party
(the "Leases"), whether now existing or hereafter arising;
(c) all other contracts and contractual
rights, remedies, or provisions now existing or hereafter
arising in favor of the Borrower (the "Other Contracts");
General Intangibles. All of the Borrower's general intangibles
(including, without limitation, any proceeds from insurance policies
after payment of prior interests), patents, unpatented inventions,
trade secrets, copyrights, contract rights, goodwill, literary rights,
rights to performance, rights under licenses, choses-in-action, claims,
information contained in computer media (such as data bases, source and
object codes, and information therein) things in action, trademarks and
trademarks applied for (together with the goodwill associated
therewith) and derivatives thereof, trade names, including the right to
make, use, and vend goods utilizing any of the foregoing, and permits,
licenses, certifications, authorizations and approvals, (to the extent
that the Borrower may grant a security interest therein without the
consent of the granting party) and the rights of the Borrower
thereunder, issued by any governmental, regulatory, or private
authority, agency, or entity whether now owned or hereafter acquired,
together with all cash and non-cash proceeds and products thereof (the
"Intangibles");
General Communication, Inc. - Form 8-K
Page 308
Licenses. Subject to Section 22 hereof, and to the extent (i)
permitted by Applicable Law, or (ii) that the Borrower may grant a
security interest therein without violating a valid and enforceable
restriction on the granting of a security interest contained therein,
all franchises, licenses, permits, and operating rights authorizing or
relating to the Borrower's rights to construct and operate cable and
pay-cable television facilities, including, without limitation, the
Licenses held by the Borrower, including, without limitation, those
described on Exhibit A attached hereto (the "Licenses");
Furniture and Fixtures. All furniture and fixtures in which
the Borrower has an interest (the "Furniture and Fixtures");
Miscellaneous Items. All goods, chattel paper, documents,
instruments, choses in action, claims, money, deposits, certificates of
deposit, stock or share certificates, licenses and other rights in
intellectual property, and other tangible personal property not
included above ("Miscellaneous Items"); and
Proceeds. All proceeds of any of the above, and all proceeds
of any loss of, damage to, or destruction of the above, whether insured
or not insured, and all other proceeds of any sale, lease, or other
disposition of any property or interest therein referred to above,
together with all proceeds of any policies of insurance covering any or
all of the above, the proceeds of any award in condemnation with
respect to any of the property of the Borrower, any rebates or refunds,
whether for taxes or otherwise, and all proceeds of any such proceeds
(the "Proceeds").
The Inventory, Equipment, Accounts, Contracts, Other Contracts, Leases,
Intangibles, Licenses, Furniture and Fixtures, Miscellaneous Items, and Proceeds
thereof, as described above, are hereinafter collectively referred to as the
"Collateral."
This Agreement and the Security Interest secure the Obligations,
whether now or hereafter existing.
2. Further Assurances. The Borrower agrees to make, execute,
deliver, or cause to be done, executed, and delivered, from time to time, all
such further acts, documents, and things as the Administrative Agent on behalf
of the Managing Agents and the Banks, may reasonably require for the purpose of
perfecting or protecting its or their rights hereunder or otherwise giving
effect to this Agreement, all within thirty (30) days following the request
therefor. In addition, the Borrower hereby authorizes the Administrative Agent
upon the Borrower's failure to do so, to file such financing statements and such
other documents as the Administrative Agent may deem necessary or desirable to
protect or perfect the interest of the Administrative Agent, for itself and on
behalf of the Managing Agents and the Banks in the Collateral, and the Borrower
further irrevocably appoints the Administrative Agent as the Borrower's
attorney-in-fact, with power of attorney to execute on behalf of the Borrower
such
General Communication, Inc. - Form 8-K
Page 309
UCC financing statement amendment forms as the Administrative Agent may from
time to time deem necessary or desirable. Such power of attorney is coupled with
an interest and shall be irrevocable for so long as any of the Obligations
remains unpaid or unperformed or any of the Banks have any obligation to make
Advances under the Loan Agreement, regardless of whether the conditions
precedent to the making of any such Advances have been or can be fulfilled.
3. Representations and Warranties. The Borrower represents and
warrants to the Administrative Agent, the Managing Agents and the Banks that:
(a) Exhibit B attached hereto and
incorporated herein by this reference sets forth a complete
and accurate list of the Pole Agreements and utility
agreements in effect on the date hereof, and the Borrower has
furnished or will furnish copies thereof to the Administrative
Agent, the Managing Agents and the Banks; and
(b) Exhibit C attached hereto and
incorporated herein by this reference sets forth a complete
and accurate list of all Leases for real property and all
material Capitalized Lease Obligations to which the Borrower
is a party in effect on the date hereof, and the Borrower has
furnished or will furnish copies thereof to the Administrative
Agent, the Managing Agents and the Banks.
4. Priority of Security Interest. The Borrower further
represents and warrants that the Security Interest in the Collateral granted to
the Administrative Agent hereunder shall constitute at all times a valid first
priority security interest in favor of the Administrative Agent in and upon the
Collateral, subject only to Permitted Liens. The Borrower shall take or cause to
be performed such acts and actions as shall be necessary or appropriate to
assure that the Security Interest upon the Collateral shall not become
subordinate or junior to the security interests, Liens, or claims of any other
Person, except for Permitted Liens.
5. Locations of Collateral. The Borrower further represents
and warrants that it now keeps all of its records concerning its Collateral
either at its chief executive office, or at the chief executive office of the
Manager, which are as follows:
General Communication, Inc. - Form 8-K
Page 310
Borrower: GCI Cable, Inc.
-------------------------------
-------------------------------
-------------------------------
-------------------------------
Manager: Prime II Management, L.P.
3000 One American Center
600 Congress Avenue
Austin, Texas 78701
The Borrower covenants and agrees that it shall not keep any of such records at
any other address unless written notice thereof is given to the Administrative
Agent at least thirty (30) days prior to the effective date of any new address
for the keeping of such records. The Borrower's principal place of business is
located at , Anchorage,
Alaska 99503, and all of the Collateral is located in the
Recording District, Alaska. The Borrower further
agrees that it shall immediately advise the Administrative Agent, in writing,
making reference to this Section of this Agreement, of the opening of any new
place of business, the closing of any existing place of business, or any change
in the location of the place where it keeps the Collateral.
6. Collateral Not Fixtures. The parties intend that, to the
extent permitted by Applicable Law, the Collateral shall remain personal
property irrespective of the manner of its attachment or affixation to realty.
7. Risk of Loss, Sale of Collateral. Any and all injury to, or
loss or destruction of, the Collateral shall be at the Borrower's risk, and
shall not release the Borrower from its obligations hereunder. Except as
permitted under the Loan Agreement, the Borrower agrees not to sell, transfer,
assign, dispose of, mortgage, grant a security interest in, or encumber any of
the Collateral in any manner without the prior written consent of those Persons
required under Section 11.13 of the Loan Agreement. The Borrower further agrees
that the Administrative Agent may, but shall in no event be obligated to, insure
any of the Collateral in such form and amount as the Administrative Agent may
deem necessary or desirable if the Borrower fails to obtain insurance as
required by the Loan Agreement, and that the Administrative Agent may pay or
discharge any taxes, liens, or encumbrances which are not Permitted Liens on any
of the Collateral, and the Borrower agrees to pay upon demand any such sum so
expended by the Administrative Agent with interest at the Default Rate, and such
sums and interest shall be deemed to be a part of the Obligations secured by the
Collateral under the terms of this Agreement.
8. Covenants of Borrower. The Borrower shall (i) fulfill,
perform and observe each and every material condition and covenant contained in
any of the material Contracts, the Other Contracts, or the Leases, (ii) give
prompt notice to the extent required under the Loan Agreement to the
Administrative Agent, the Managing Agents and the Banks of any claim of material
default under any of the Contracts, the
General Communication, Inc. - Form 8-K
Page 311
Other Contracts, or the Leases given to the Borrower or by the Borrower, (iii)
at the sole cost and expense of the Borrower, enforce the performance and
observance of each and every material covenant and condition of the material
Contracts, the Other Contracts, or the Leases to be performed or observed by
other parties to any of the material Contracts, the Other Contracts, or Leases,
and (iv) appear in, defend and, as appropriate, settle any action growing out of
or in any manner connected with any Contract, Other Contract, or Lease;
provided, however, that prior to the occurrence of an Event of Default (which
remains uncured or unwaived), the Borrower may issue or obtain waivers in the
ordinary course of business with respect to items (i) and (iii). The rights and
interests transferred and assigned to the Administrative Agent hereunder include
all of the Borrower's right and title (i) to modify the Contracts, the Other
Contracts, and Leases, (ii) to terminate the Contracts, the Other Contracts, and
the Leases, and (iii) to waive or release the performance or observance of any
obligation or condition of the Contracts, the Other Contracts, and the Leases;
provided, however, that these rights of the Administrative Agent shall not be
exercised unless an Event of Default shall exist hereunder.
9. Remedies. Upon the occurrence of an Event of Default and
until such Event of Default is waived in writing in accordance with Section
11.13 of the Loan Agreement (or, if prior to acceleration or the exercise of any
other remedies pursuant to Section 8.2 of the Loan Agreement, cured), the
Administrative Agent shall have such rights and remedies as are set forth in the
Loan Agreement and herein, all the rights, powers and privileges of a secured
party under the Uniform Commercial Code of the State of New York and any other
applicable jurisdiction, and all other rights and remedies available to the
Administrative Agent, at law or in equity. The Borrower covenants and agrees
that any notification of intended disposition, including any public or private
sale, of any Collateral, if such notice is required by law, shall be deemed
reasonably and properly given if given in the manner provided for in Section 19
hereof at least ten (10) Business Days prior to such disposition. Upon the
occurrence of an Event of Default and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Administrative Agent upon the written request of
the Majority Banks, shall have the right to the appointment of a receiver for
the properties and assets of the Borrower, and the Borrower hereby consents to
such rights and such appointment and hereby waives any objection the Borrower
may have thereto or the right to have a bond or other security posted by the
Administrative Agent in connection therewith.
10. Administrative Agent's Right to Perform Contracts. Upon
the occurrence of an Event of Default and until such Event of Default is waived
in writing in accordance with Section 11.13 of the Loan Agreement (or, if prior
to acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Administrative Agent may proceed to perform any
and all of the obligations of the Borrower contained in any of the Contracts,
the Other Contracts, or the Leases and exercise any and all rights of the
Borrower therein contained as fully as the Borrower itself could. The Borrower
hereby appoints the
General Communication, Inc. - Form 8-K
Page 312
Administrative Agent its attorney-in-fact, effective upon the occurrence of an
Event of Default and until such Event of Default is waived in writing in
accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), with power of substitution, to take such action,
execute such documents, and perform such work, as the Administrative Agent may
deem appropriate in exercise of the rights and remedies granted the
Administrative Agent herein. The powers herein granted shall include, but not be
limited to, powers to sue on the Contracts, the Other Contracts, or the Leases
and to seek all governmental approvals required for the operation of the System
(or any portion thereof). The power of attorney granted herein is coupled with
an interest and shall be irrevocable for so long as any of the Obligations
remains unpaid or unperformed or any of the Banks have any obligation to make
Advances under the Loan Agreement, regardless of whether the conditions
precedent to the making of any such Advances have been or can be fulfilled.
11. Right to Cure Borrower's Default Under Contracts. Upon the
occurrence of an Event of Default and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), should the Borrower fail to perform or observe any
material covenant or comply with any material condition contained in any of the
Contracts, the Other Contracts, or the Leases, then the Administrative Agent,
but without obligation to do so and without releasing the Borrower from its
obligation to do so, may perform such covenant or condition and, to the extent
that the Administrative Agent shall incur any costs or pay any expenses in
connection therewith, including any costs or expenses of litigation associated
therewith, such costs, expenses, or payments shall be included in the
Obligations secured hereby and shall bear interest from the payment of such
costs or expenses at the Default Rate. Anything herein to the contrary
notwithstanding (a) the Borrower shall remain liable under the Contracts, the
Other Contracts, the Leases and all other contracts and agreements included in
the Collateral to the same extent set forth therein to perform all of the duties
and obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Administrative Agent of any of the rights
hereunder shall not release the Borrower from any of its duties or obligations
under the Contracts, the Other Contracts, the Leases or any other contract or
agreements included in the Collateral, and (c) none of the Administrative Agent,
any Managing Agent, nor any Bank, shall be obligated to perform or discharge any
obligation of the Borrower under any of the Contracts, the Other Contracts, the
Leases, or any other contracts or agreements included in the Collateral and, the
Borrower agrees to indemnify and hold the Administrative Agent, the Managing
Agents, and the Banks harmless against any and all liability, loss, and damage
which the Administrative Agent, the Managing Agents, and the Banks, or any of
them, may incur under any of the Contracts, the Other Contracts, the Leases or
any other contracts or agreements included in the Collateral or under or by
reason of this Agreement, and any and all claims and demands whatsoever which
may be asserted against the Borrower by reason of an act of any of the
Administrative Agent, the Managing Agents, or the Banks under any of the terms
of this Agreement or under the Contracts, the Other Contracts or the
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Leases; unless, with respect to any of the above, the party seeking
indemnification is finally judicially determined to have acted with gross
negligence or wilful misconduct.
12. Agent Attorney-in-Fact. The Borrower hereby further
appoints the Administrative Agent as its attorney-in-fact, effective upon the
occurrence of an Event of Default and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), with power of substitution, and with authority to
receive, open, and take appropriate action with respect to all mail addressed to
the Borrower, and to notify the postal authorities to change the address for
delivery of mail addressed to the Borrower to such address as the Administrative
Agent may designate, to endorse the name of the Borrower on any note,
acceptance, check, draft, money order, or other evidence of debt or of payment
which may come into the possession of any of the Administrative Agent, the
Managing Agents and the Banks, and generally to do such other things and acts in
the name of the Borrower as are necessary or appropriate to protect or enforce
the rights hereunder of the Administrative Agent, the Managing Agents, and the
Banks. The Borrower further authorizes the Administrative Agent effective upon
the occurrence of an Event of Default and until such Event of Default is waived
in writing in accordance with Section 11.13 of the Loan Agreement (or, if prior
to acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), to compromise and settle or to sell, assign, or
transfer or to ask, collect, receive, or issue any and all claims possessed by
the Borrower all in the name of the Borrower. After deducting all reasonable
expenses and charges (including the Administrative Agent's reasonable attorneys'
fees) of retaking, keeping, storing, and selling the Collateral, the
Administrative Agent shall apply the proceeds in payment of any of the
Obligations in such order of application as is set forth in the Loan Agreement,
and, if a deficiency results after such application, the Borrower covenants and
agrees to pay such deficiency to the Administrative Agent. The power of attorney
granted herein is coupled with an interest and shall be irrevocable for so long
as any of the Obligations remains unpaid or unperformed or any of the Banks have
any obligation to make Advances under the Loan Agreement, regardless of whether
the conditions precedent to the making of any such Advances have been or can be
fulfilled. The Borrower agrees that if steps are taken by the Administrative
Agent to enforce rights hereunder, or to realize upon any of the Collateral, the
Borrower shall pay to the Administrative Agent the amount of the costs,
including reasonable attorneys' fees, incurred in connection with such
enforcement, and the Borrower's obligation to pay such amounts shall be deemed
to be a part of the Obligations secured hereunder.
13. Indemnification. The Borrower shall indemnify and hold
harmless the Administrative Agent, the Managing Agents, and the Banks, and each
of them, and any other Person acting hereunder for all losses, costs, damages,
fees, and expenses whatsoever associated with the exercise of the powers of
attorney granted herein and shall release the Administrative Agent, the Managing
Agents, and the Banks and any other Person acting hereunder from all liability
whatsoever for the exercise of the foregoing powers of attorney and all actions
taken pursuant thereto, unless in any
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such event such Person seeking indemnification hereunder is finally judicially
determined to have acted or failed to act with gross negligence or willful
misconduct.
14. Rights Cumulative. The Borrower agrees that the rights of
the Administrative Agent, the Managing Agents, and the Banks under this
Agreement, the Loan Agreement, the other Loan Documents, or any other contract
or agreement now or hereafter in existence between the Administrative Agent, the
Managing Agents, and the Banks, or any of them, and the Borrower shall be
cumulative and that the Administrative Agent may from time to time exercise such
rights and such remedies as the Administrative Agent may have thereunder and
under the laws of the United States and any state, as applicable, in the manner
and at the time that the Administrative Agent, the Managing Agents and the Banks
in their sole discretion desire. The Borrower further expressly agrees that none
of the Administrative Agent, the Managing Agents and the Banks shall in any
event be under any obligation to resort to any Collateral prior to exercising
any other rights that the Administrative Agent, the Managing Agents and the
Banks, or any of them, may have against the Borrower or its property, or to
resort to any other collateral for the Obligations prior to the exercise of
remedies hereunder.
15. Receivership. The Borrower hereby acknowledges that the
Obligations arose out of a commercial transaction, and agrees that if an Event
of Default shall occur, hereunder (and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Administrative Agent shall have the right to an
immediate writ of possession without notice of a hearing, and hereby knowingly
and intelligently waives any and all rights it may have to any notice and
posting of a bond by the Administrative Agent, the Managing Agents, and the
Banks, or any of them, prior to seizure by the Administrative Agent or any of
its transferees, assigns, or successors in interest, of the Collateral or any
portion thereof.
16. Remedies Not Exclusive. No transfer or renewal, extension,
assignment, or termination of this Agreement, the Loan Agreement, any other Loan
Document, or any other instrument or document executed and delivered by the
Borrower to the Administrative Agent, the Managing Agents, and the Banks, or any
of them, nor any additional Advances made by the Banks to the Borrower, nor the
taking of further security, nor the retaking or redelivery of the Collateral to
the Borrower by any of the Administrative Agent, the Managing Agents and the
Banks, nor any other act of any of the Administrative Agent, the Managing Agents
and the Banks shall release the Borrower from any Obligation, except a release
or discharge executed in writing by the Administrative Agent, the Managing
Agents and the Banks (as and to the extent required under the Loan Agreement)
with respect to such Obligation or payment of such Obligation or upon full
payment to the Administrative Agent, the Managing Agents and the Banks and
satisfaction of all the Obligations. Neither the Administrative Agent, the
Managing Agents nor the Banks shall by any act, delay, omission or otherwise, be
deemed to have waived any of their rights or remedies hereunder, unless such
waiver is in writing and signed by the Administrative
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Agent, and, as required by the Loan Agreement, the Managing Agents and the Banks
and then only to the extent therein set forth. A waiver by the Administrative
Agent, the Managing Agents and the Banks, or any of them, of any right or remedy
on any occasion shall not be construed as a bar to the exercise of any such
right or remedy which any of the Administrative Agent, the Managing Agents and
the Banks would otherwise have had on any other occasion.
17. Assignment. The Borrower agrees that this Agreement and
rights of the Administrative Agent, the Managing Agents and the Banks hereunder
may in the discretion of such Person be assigned in whole or in part by such
Person in connection with any permitted assignment of such Person's interest in
the Loan Agreement or the Obligations. In the event this Agreement is so
assigned by any of the Administrative Agent, the Managing Agents and the Banks,
the terms "Administrative Agent," "Managing Agent,""Managing Agents," "Bank" and
"Banks" wherever used herein shall be deemed to refer to and include any such
assignee or assignees, as appropriate. This Agreement may not be assigned by the
Borrower without the prior written consent of each Bank.
18. Successors and Assigns. This Agreement shall apply to and
bind the respective successors and permitted assigns of the Borrower and inure
to the benefit of the respective successors and assigns of the Administrative
Agent, the Managing Agents and the Banks.
19. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be given in a manner
prescribed and to the addresses set forth in Section 11.1 of the Loan Agreement.
20. Governing Law, Etc. The provisions of this Agreement shall
be construed and interpreted, and all rights and obligations of the parties
hereto determined, in accordance with the laws of the State of New York without
reference to the conflicts or choice of law principles thereof. This Agreement,
together with all documents referred to herein, constitutes the entire Agreement
between the Borrower, the Administrative Agent, the Managing Agents, and the
Banks with respect to the matters addressed herein, and may not be modified
except by a writing executed by the Administrative Agent and the Borrower.
21. Severability. If any paragraph or part hereof shall for
any reason be held or adjudged to be invalid, illegal, or unenforceable by any
court of competent jurisdiction, such paragraph or part hereof so adjudicated
invalid, illegal or unenforceable shall be deemed separate, distinct and
independent, and the remainder of this Agreement shall remain in full force and
effect and shall not be affected by such holding or adjudication.
22. FCC Consent. Notwithstanding anything herein which may be
construed to the contrary, no action shall be taken by any of the Administrative
Agent, the Managing Agents or the Banks with respect to the Licenses or any
license of the Federal Communications Commission ("FCC") unless and until all
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requirements of Applicable Law, including, without limitation, any required
approval of either of the Alaska Public Utilities Commission or the U.S.
Government (together the "Licensors") and any required approval under the
Federal Communications Act of 1934, and any applicable rules and regulations
thereunder, requiring the consent to or approval of such action by either of the
Licensors, the FCC or any other governmental or other authority, have been
satisfied. The Borrower covenants that upon request of the Administrative Agent
it will cause to be filed such applications and take such other action as may be
requested by such Person or Persons to obtain consent or approval of either of
the Licensors, the FCC or any other governmental or other authority which has
granted any License to the Borrower to any action contemplated by this Agreement
and to give effect to the Security Interest of the Administrative Agent,
including, without limitation, the execution of an application for consent by
the FCC to an assignment or transfer involving a change in ownership or control
pursuant to the provisions of the Federal Communications Act of 1934. To the
extent permitted by Applicable Law, the Administrative Agent is hereby
irrevocably appointed the true and lawful attorney-in-fact of the Borrower, in
its name and stead, to execute and file all necessary applications with the
Licensors, the FCC and with any other governmental or other authority. The power
of attorney granted herein is coupled with an interest and shall be irrevocable
for so long as any of the Obligations remains unpaid or unperformed or any of
the Banks have any obligation to make Advances under the Loan Agreement,
regardless of whether the conditions precedent to the making of any such
Advances has been or can be fulfilled.
23. Termination and Release. Upon satisfaction in full of the
Obligations (other than any Obligation which may survive the termination of the
Loan Agreement as provided for therein) and termination of the Commitment, the
Administrative Agent shall take any actions reasonably necessary to terminate
and release the security interest in the Collateral granted to the
Administrative Agent hereunder, all at the cost and expense of the Borrower.
24. Administrative Agent. Each reference herein to any right
granted to, benefit conferred upon, or power exercisable by the "Administrative
Agent" shall be a reference to the Administrative Agent (including any
successors to the Administrative Agent pursuant to the Loan Agreement) for
itself and for the ratable benefit of the Managing Agents and the Banks, and
each action taken or right exercised hereunder shall be deemed to have been so
taken or exercised by the Administrative Agent for itself and for the benefit of
and on behalf of all of the Managing Agents and the Banks.
25. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
General Communication, Inc. - Form 8-K
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IN WITNESS WHEREOF, the undersigned have caused this
Agreement to be executed, by and through their duly authorized representatives,
as of the day and year first above written.
BORROWER: GCI CABLE, INC., an Alaska corporation
By: /s/ John M. Lowber
Title: Secretary/Treasurer
Attest:
Title:
[CORPORATE SEAL]
ADMINISTRATIVE
AGENT: TORONTO DOMINION (TEXAS), INC.,
as Administrative Agent
By: /s/ Jano Mott
Title: Vice President
Exhibit A - Licenses
Exhibit B - Pole and Utility Contracts
Exhibit C - Leases
General Communication, Inc. - Form 8-K
Page 318
EXHIBIT I
FORM OF SUBORDINATION AND ASSIGNMENT
OF MANAGEMENT AGREEMENT
THIS SUBORDINATION AND ASSIGNMENT OF MANAGEMENT AGREEMENT (the
"Agreement"), made as of this 31st day of October, 1996, by and among GCI Cable,
Inc., an Alaska corporation (the "Borrower"), Prime II Management, L.P., a
Delaware limited partnership (the "Manager"), and Toronto Dominion (Texas), Inc.
(the "Administrative Agent"), as administrative agent for the Managing Agents
and the Banks,
W I T N E S S E T H:
WHEREAS, the Borrower has entered into that certain Loan Agreement
dated as of October 31, 1996 (as the same may be amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") by and among the
Borrower, the Administrative Agent, the Managing Agents and the Banks; and
WHEREAS, the Borrower as a result of the GCI Acquisition of even date
herewith, is acquiring a ninety-nine percent (99%) general partnership interest
in the Prior Borrower, and GCI Cable Holdings, Inc., a wholly-owned subsidiary
of the Borrower, is acquiring a one-percent (1%) limited partnership interest in
the Prior Borrower; and
WHEREAS, the Manager was engaged previously in the business of
providing management services to the Prior Borrower in return for management
fees; and
WHEREAS, the Manager now desires to perform similar management services
to the Borrower and its Subsidiaries (including the Prior Borrower) in return
for management fees and deems it to be in its best interests to enter into this
Agreement; and
WHEREAS, the execution and delivery of this Agreement is a condition,
among others, to the making of the Loans by the Banks to the Borrower; and
NOW, THEREFORE, to induce the Administrative Agent, the Managing Agents
and the Banks to enter into the Loan Agreement, to induce the Banks to make the
Loans, and for Ten Dollars ($10.00) and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Manager hereby
agrees with the Administrative Agent (for itself and on behalf of the Managing
Agents, and the Banks) as follows:
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1. Definitions. For purposes hereof,
"Senior Indebtedness" means collectively (i) the Obligations
expressly including, without limitation, any post-petition interest,
and (ii) any amounts which the Administrative Agent, any Managing Agent
or any Bank may be owed as a result of a breach of any obligation,
covenant or undertaking set forth in this Agreement.
"Subordinated Debt" means, collectively, all management fees
or other obligations of the Borrower to the Manager arising under or in
connection with the Management Agreement or otherwise, however
evidenced or incurred, whether direct or indirect, absolute or
contingent, now existing or hereafter arising, due or to become due,
other than (i) out of pocket expenses reasonably incurred by officers
and employees of the Manager in traveling to and from and visiting the
Systems, and (ii) expenses reasonably incurred by the Manager for goods
and/or services provided by third parties on behalf of the Borrower.
All other capitalized terms used herein shall have the meanings ascribed to such
terms in the Loan Agreement unless otherwise defined or limited herein.
2. Security Interest. The Manager hereby unconditionally
assigns, transfers, conveys and grants to the Administrative Agent, for the
ratable benefit of the Banks, all of its rights, title and interest in and to,
and a continuing security interest in and security title to, the Management
Agreement and all proceeds thereof as security for the Senior Indebtedness.
3. Subordination.
(a) All Senior Indebtedness shall be paid in full in
cash before any payment is made or amount accrued on account of any Subordinated
Debt, except to the extent such Subordinated Debt is expressly permitted to be
accrued or paid by the Borrower to the Manager pursuant to Section 7.7 of the
Loan Agreement;
(b) In the event that the Borrower shall make any
unauthorized payment on account of the Subordinated Debt to the Manager, such
payment shall be held by the Manager in trust for the benefit of, and shall be
paid forthwith over and delivered to, the Administrative Agent, for application
to the payment of the Senior Indebtedness in accordance with the Loan Agreement;
and
(c) The Manager acknowledges and agrees that upon
the occurrence of an Event of Default and until such Event of Default is waived
in writing in accordance with Section 11.13 of the Loan Agreement (or, if prior
to acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Borrower is not permitted to make any payments
in respect of the Subordinated Debt, and that the Administrative Agent shall
have the right to notify and instruct the Borrower to thereafter make all
payments otherwise due in respect of the Subordinated Debt directly to the
Administrative Agent, and the Administrative
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Agent shall have the right to apply all such payments received in reduction of
the Senior Indebtedness in accordance with the terms and provisions of the Loan
Agreement. The Manager further agrees that immediately upon the request of the
Administrative Agent upon the occurrence of an Event of Default, and until such
Event of Default is waived in writing in accordance with Section 11.13 of the
Loan Agreement, the Manager shall cause the Borrower to make all payments under
the Management Agreement or otherwise in respect of the Subordinated Debt
directly to the Administrative Agent. In no event shall the Borrower pay or the
Manager receive any payment, interest or delinquency charges of any type
whatsoever in respect of the Subordinated Debt except to the extent permitted
under Section 7.7 of the Loan Agreement.
4. Covenants of the Manager.
(a) The Manager agrees that the Subordinated Debt
shall be unsecured, and that, so long as any of the Senior Indebtedness shall
remain unpaid or any of the Banks shall be under any obligation to make any
Advance under the Loan Agreement (whether or not the conditions to such Advance
have been or can be fulfilled), if at any time after the occurrence and during
the continuation of an Event of Default the Manager shall be in possession of
any assets of the Borrower which are subject to a Lien in favor of the
Administrative Agent ("Collateral"), the Manager shall promptly deliver such
Collateral to the Administrative Agent, and until such delivery shall hold such
Collateral in trust for the Administrative Agent for the ratable benefit of the
Banks.
(b) Until such time as the Senior Indebtedness has
been paid in full and the Banks are under no further obligation to make any
Advance to the Borrower under the Loan Agreement (whether or not the conditions
to such Advance have been or can be fulfilled), the Manager agrees not to
exercise any of its remedies under the Management Agreement or any other
document, instrument, or agreement relating thereto or to the Subordinated Debt
in order to collect the Subordinated Debt, or to accelerate or, except as
permitted to be accrued or paid by the Borrower pursuant to Section 7.7 of the
Loan Agreement, collect any portion of the Subordinated Debt, or to realize upon
any of the Collateral or any other assets of the Borrower, or to attach, levy
upon, or execute against any of the Collateral or any other assets of the
Borrower.
(c) The Manager agrees that it will not in its
capacity as a creditor of the Borrower, institute against or join any other
Person in instituting against the Borrower, any bankruptcy, reorganization,
insolvency, or liquidation proceeding or any other proceeding under any federal
or state bankruptcy or similar law for a period of one (1) year and one (1) day
after the date on which all Senior Indebtedness has been paid in full in cash
and none of the Banks is under any further obligation to make any Advance to the
Borrower, regardless of whether the conditions precedent to any such Advance
have been or can be fulfilled.
General Communication, Inc. - Form 8-K
Page 321
(d) The Manager covenants and agrees that it will
not, at any time during the term of this Agreement, except as permitted under
the Loan Agreement, enter into any amendment of the Management Agreement or
convey, encumber or assign its rights or obligations thereunder in any manner
whatsoever.
5. Bankruptcy. Upon any distribution of the assets or
properties of the Borrower or upon any dissolution, winding up, liquidation, or
reorganization involving the Borrower (whether in bankruptcy, insolvency, or
receivership proceedings or upon an assignment for the benefit of creditors or
otherwise):
(a) the Administrative Agent, the Managing Agents
and the Banks shall first be entitled to receive payment in full of all Senior
Indebtedness before the Manager is entitled to receive any payment on account of
the Subordinated Debt;
(b) any payment or distribution of the assets or
properties of the Borrower of any kind or character, whether in cash, property,
or securities, to which the Manager would be entitled except for the provisions
of this Agreement, shall be paid by the trustee or agent or other Person making
such payment or distribution directly to the Administrative Agent; and
(c) in the event that, notwithstanding the
foregoing, any payment or distribution of the assets or properties of the
Borrower of any kind or character, whether in cash, property, or securities,
shall be received by the Manager on account of the Subordinated Debt before all
Senior Indebtedness is paid in full in cash, such payment or distribution shall
be received and held in trust for and shall be paid over to the Administrative
Agent, for application to the payment of the Senior Indebtedness as provided in
the Loan Agreement until all such Senior Indebtedness shall have been paid in
full in cash.
6. Rights of Agent Absolute. No right of the Administrative
Agent, any of Managing Agents, or any of the Banks, or any present or future
holder of any Senior Indebtedness to enforce subordination as provided herein
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Borrower, or by any act or failure to act, in good faith,
by any such holder of the Senior Indebtedness, or by any noncompliance by the
Borrower with any of the terms of the Notes or any other Loan Document,
regardless of any knowledge thereof with which such Person may have or be
otherwise charged.
7. Agent Attorney-in-Fact. The Manager authorizes and
expressly directs the Administrative Agent to take such action as may be
necessary or appropriate from time to time to effectuate the subordination and
assignment provided herein and, effective upon the occurrence of an Event of
Default, and until such Event of Default is waived in writing in accordance with
Section 11.13 of the Loan Agreement (or, if prior to acceleration or the
exercise of any other remedies pursuant to Section 8.2 of the Loan Agreement,
cured) appoints the Administrative Agent its attorney-in-fact for such purpose,
including, without limitation, in the event of any dissolution, winding up,
liquidation, or reorganization of the Borrower (whether in bankruptcy,
insolvency,
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Page 322
or receivership proceedings or upon an assignment for the benefit of creditors
or otherwise tending towards liquidation of the business or the assets of the
Borrower) the immediate filing of a claim (if such claim is not promptly filed
by the Manager) for the unpaid balance of its Subordinated Debt in the form
required in such proceedings and the taking of all steps necessary to cause such
claim to be approved. Such power of attorney is coupled with an interest, is
irrevocable and shall terminate only upon payment in full of the Senior
Indebtedness and termination of the Commitment.
8. Amendments to Senior Indebtedness. The Administrative
Agent, the Managing Agents and the Banks may extend, renew, modify, or amend the
terms of the Senior Indebtedness or any security therefor and release, transfer,
assign, sell, or exchange such security and otherwise deal freely with the
Borrower to the same extent as could any Person, all without notice to or
consent of the Manager and without affecting the liabilities and obligations of
the Manager pursuant to the provisions hereof.
9. Assignments of Senior Indebtedness. The Administrative
Agent, the Managing Agents and the Banks, or any of them, as appropriate, may
assign or transfer any or all of the Senior Indebtedness or any interest
therein, as provided in the Loan Agreement; and notwithstanding any such
assignment or transfer or any subsequent assignment or transfer thereof, such
Senior Indebtedness shall be and remain Senior Indebtedness for purposes of this
Agreement, and every immediate and permitted successive assignee or transferee
or participant of any of the Senior Indebtedness or of any interest therein
shall, to the extent of the interest of such assignee or transferee or
participant in the Senior Indebtedness, be entitled to the benefits of this
Agreement to the same extent as if such assignee or transferee or participant
were the Administrative Agent, a Managing Agent, or a Bank hereunder, as
appropriate; provided, however, that, unless the appropriate assignor shall
otherwise consent in writing, such assignor shall have an unimpaired right,
prior and superior to that of any such assignee or transferee or participant, to
enforce this Agreement as to such Senior Indebtedness which has not been
assigned or transferred.
10. Waivers. The Manager hereby waives (a) notice of
acceptance of this Agreement by the Administrative Agent, the Managing Agents,
and the Banks, (b) notice of the existence or creation or nonpayment of all or
any part of the Senior Indebtedness, and (c) all diligence in the collection or
protection of or realization upon the Senior Indebtedness or the Collateral
therefor.
11. Notation on Subordinated Debt. The Manager and the
Borrower hereby agree to make appropriate entries in their respective books and
records, to indicate that the Manager's rights under the Management Agreement
are subject to the terms of this Agreement and that the Subordinated Debt is
subordinate to the Senior Indebtedness.
12. Further Assurances. The Manager further agrees that it
will do all things necessary to maintain the enforceability of the Management
Agreement, and the
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Page 323
enforceability and priority of the security interest of the Administrative Agent
therein and agrees to execute, upon the request of the Administrative Agent, any
and all other documents, instruments, and agreements reasonably deemed necessary
or desirable by the Administrative Agent to carry the matters contemplated by
this Agreement into effect.
13. Remedies. Upon the occurrence of an Event of Default and
until such Event of Default is waived in writing in accordance with Section
11.13 of the Loan Agreement (or, if prior to acceleration or the exercise of any
other remedies pursuant to Section 8.2 of the Loan Agreement, cured) the
Administrative Agent shall have all of the remedies set forth herein, all of the
rights, powers and privileges of a secured party under the UCC, including,
without limitation, the right to enforce the Management Agreement, and any and
all rights of the Manager and the Borrower, thereunder, and any other rights or
remedies available to it under any other Loan Document or otherwise at law, or
in equity. It is hereby further agreed that the Administrative Agent may enforce
any and all rights derived from this Agreement by suit, either in equity or at
law, for specific performance of any agreement herein contained or for judgment
at law and any other relief whatsoever appropriate to such action or procedure.
The remedies of the Administrative Agent hereunder are cumulative, not
exclusive, and the exercise of any one or more of the remedies provided for
herein shall not be construed as a waiver of any of the other remedies of the
Administrative Agent, so long as any part of the Senior Indebtedness remains
unsatisfied. The Manager expressly agrees that the Administrative Agent shall
not be under any obligation to resort to any right or remedy hereunder prior to
exercising any other rights it may have against the Manager, the Borrower, or
any other Person to secure repayment of the Loans, nor shall the Administrative
Agent be required to resort to any such other rights prior to the exercise of
its rights and remedies hereunder. In the event this Agreement shall be enforced
by the Administrative Agent or by its counsel, the Manager and the Borrower
agree to pay all reasonable costs and out-of-pocket expenses of such
enforcement, including reasonable attorneys fees, and such costs and expenses
shall be deemed Senior Indebtedness hereunder.
14. Representations and Warranties of Manager. The Manager
represents and warrants to the Administrative Agent, for itself and on behalf of
the Managing Agents and the Banks, that:
(i) the Manager is a limited partnership duly
organized, validly existing and in good standing under the
laws of the State of Delaware, having power and authority to
own or lease and use its properties and to carry on its
business as now being and hereafter proposed to be conducted;
(ii) the general partner of the Manager is Prime II
Management, Inc., a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware;
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Page 324
(iii) the Manager is duly qualified, in good
standing, and authorized to do business in each jurisdiction
in which the character of its properties or the nature of its
business requires such qualification or authorization;
(iv) this Agreement has been duly executed and
delivered by the Manager and is the legal, valid, and binding
obligation of the Manager enforceable in accordance with its
terms except that certain equitable remedies are discretionary
and, in particular, may not be available where damages are
considered an adequate remedy at law, and that enforcement may
be limited by bankruptcy, insolvency, liquidation,
reorganization, reconstruction, and other similar laws
affecting enforcement of creditors' rights generally (insofar
as any such law relates to the bankruptcy, insolvency, or
similar event of the Manager);
(v) the execution, delivery, and performance by the
Manager of this Agreement in accordance with its terms do not
and will not (A) require any consent or approval not already
obtained, (B) violate any material Applicable Law respecting
the Manager, or (C) conflict with, result in a breach of, or
constitute a default under the certificate of limited
partnership or the partnership agreement of the Manager or, in
any material respect, under any material indenture, agreement,
or other instrument to which the Manager is a party or by
which its properties may be bound;
(vi) there is no material action, suit, or
proceeding pending against, or to the best of the Manager's
knowledge, threatened against or in any manner relating
directly and materially adversely to, the Manager or any of
its properties in any court or before any arbitrator of any
kind or before or by any governmental body;
(vii) the Manager is in compliance with all of the
provisions of its certificate of limited partnership ; and
(viii) the purpose of this Agreement is to induce
the Banks to make the Loans, and the making of the Loans will
be of indirect interest and advantage to the Manager.
15. Miscellaneous.
(a) This Agreement shall be construed in accordance
with, and the rights of the parties shall be governed by, the laws of the State
of New York.
(b) This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute but one and the same instrument.
General Communication, Inc. - Form 8-K
Page 325
(c) Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
Applicable Law, but if any provision of this Agreement shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
(d) No delay on the part of the Administrative
Agent, the Managing Agents and the Banks, or any of them, in the exercise of any
right or remedy shall operate as a waiver thereof, and no single or partial
exercise by the Administrative Agent, the Managing Agents and the Banks, or any
of them, of any right or remedy shall preclude other or further exercise thereof
or the exercise of any other right or remedy; nor shall any modification or
waiver of any of the provisions of this Agreement be binding upon the
Administrative Agent, the Managing Agents and the Banks, or any of them, except
as expressly set forth in a written instrument duly signed and delivered by or
on behalf of the Administrative Agent, for itself and on behalf of the Managing
Agents and the Banks.
(e) The priorities herein specified are applicable
irrespective of the time of creation of the Senior Indebtedness.
(f) Upon satisfaction in full of the Senior
Indebtedness, the Administrative Agent shall take any actions reasonably
necessary to terminate and release the subordination and assignment granted to
the Administrative Agent hereunder, all at the cost and expense of the Manager.
(g) The provisions of this Agreement shall be
binding upon the successors and assigns of the Borrower and the Manager and
shall inure to the benefit of the Administrative Agent, the Managing Agents and
the Banks and all subsequent holders of the Senior Indebtedness. All notices and
other communications require or permitted hereunder shall be given in the manner
prescribed in Section 11.1 of the Loan Agreement, and shall be addressed to the
Administrative Agent, the Managing Agents and the Banks at the addresses set
forth therein, and to the Manager at the following address:
Prime II Management, L.P.
3000 American Center
600 Congress Avenue
Austin, Texas 78701
Attn: President
General Communication, Inc. - Form 8-K
Page 326
with a copy to:
Edens, Snodgrass, Nichols and Breeland, P.C.
2800 Franklin Plaza
111 Congress Avenue
Austin, Texas 78801
Attn: Patrick K. Breeland, Esq.
(h) Administrative Agent. Each reference herein to
any right granted to, benefit conferred upon, or power exercisable by the
"Administrative Agent" shall be a reference to the Administrative Agent
(including any successors to the Administrative Agent pursuant to the Loan
Agreement) for itself and for the ratable benefit of the Managing Agents and the
Banks, and each action taken or right exercised hereunder shall be deemed to
have been so taken or exercised by the Administrative Agent for itself and for
the benefit of and on behalf of all of the Managing Agents and the Banks.
16. Nonrecourse Obligations. Except to the extent of
any representation, warranty, covenant or undertaking made specifically by the
Manager in this Agreement, the Manager shall not have any personal liability
under this Agreement or any other Loan Document, anything to the contrary herein
or therein notwithstanding.
General Communication, Inc. - Form 8-K
Page 327
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
MANAGER: PRIME II MANAGEMENT, L.P.,
a Delaware limited partnership
By its General Partner:
PRIME II MANAGEMENT, INC.,
a Delaware corporation
[CORPORATE SEAL]
By: /s/ Karen Miller
Its: Vice President
Attest:
Its:
ADMINISTRATIVE
AGENT: TORONTO DOMINION (TEXAS), INC., for itself and
on behalf of the Managing Agents and the Banks
By: /s/ Jano Mott
Its: Vice President
BORROWER: GCI CABLE, INC., a Alaska corporation
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Attest:
Its:
General Communication, Inc. - Form 8-K
Page 328
EXHIBIT J
FORM OF SUBSIDIARY GUARANTY
As of October 31, 1996
WHEREAS, GCI Cable, Inc., an Alaska corporation (the "Borrower"), Toronto
Dominion (Texas), Inc. as administrative agent for the Managing Agents and the
Banks (the "Administrative Agent"), the Managing Agents and the Banks have
entered into a certain Loan Agreement dated as of October 31, 1996 (as executed
on the date hereof and as the same may be amended from time to time, the "Loan
Agreement"), pursuant to which the Banks have agreed to make loans in an
aggregate principal amount not to exceed $205,000,000 (the "Loans") to the
Borrower, as evidenced by those certain promissory notes of even date from the
Borrower to each of the Banks (as executed on the date hereof and as such notes
may be amended, modified, extended or renewed from time to time, the "Notes");
and
WHEREAS, each of GCI Cable/Juneau, Inc., an Alaska corporation; GCI
Cable/Fairbanks, Inc., an Alaska corporation; GCI Cable Holdings, Inc., an
Alaska corporation; and Prime Cable of Alaska, L.P., a Delaware limited
partnership (collectively, the "Guarantors" and each, individually, a
"Guarantor") is a wholly-owned Subsidiary of the Borrower; and
WHEREAS, the Guarantors and the Borrower are mutually dependent on each
other in the conduct of their respective businesses as an integrated operation,
and the Borrower has as one of its corporate purposes the obtaining of financing
needed from time to time by the Guarantors, with the Borrower's ability to
obtain such financing being dependent, in part, on the successful operations of
and the properties owned by the Guarantors; and
WHEREAS, each of the Guarantors has determined that its execution, delivery
and performance of this Guaranty directly benefit, and are within the corporate
or partnership purposes and in the best interests of, such Guarantor; and
WHEREAS, as a condition to the Banks' extending the Loans, each Guarantor
has agreed to execute this Subsidiary Guaranty (the "Guaranty") guaranteeing the
payment and performance by the Borrower of its obligations and covenants under
the Notes, the Loan Agreement and the other Loan Documents (the Notes, Loan
Agreement and other Loan Documents as executed on the date hereof and as they
may be amended, modified or extended from time to time being hereinafter
referred to as the "Guaranteed Agreements"); and
WHEREAS, capitalized terms used herein and not otherwise defined herein
shall be used as defined in the Loan Agreement;
General Communication, Inc. - Form 8-K
Page 329
NOW, THEREFORE, in consideration of the above premises, Ten Dollars ($10.00)
in hand paid and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Guarantor hereby guarantees
to the Administrative Agent, the Banks and the Managing Agents: (i) full and
prompt payment and performance of all obligations of the Borrower to the
Administrative Agent, the Banks and the Managing Agents, or any of them, under
the Guaranteed Agreements (including, without limitation, any Interest Hedge
Agreements between the Borrower, on the one hand, and the Administrative Agent
and the Banks, or any of them, on the other hand, and any interest, fees and
other charges in respect of any of the Guaranteed Agreements that would accrue
but for the filing of a bankruptcy action with respect to the Borrower, whether
or not such claim is allowed in such bankruptcy action), as the same may be
amended from time to time, or as a result of making the Loans; (ii) payment of
any and all damage which the Administrative Agent, the Banks and the Managing
Agents, or any of them, may suffer by reason of a breach of any obligation,
covenant or undertaking with respect to this Guaranty or any of the Guaranteed
Agreements by the Borrower or any other obligor thereunder; and (iii) payment
and performance of all of the obligations of any obligor to the Administrative
Agent, the Banks, the Managing Agents, or any of them, under this Guaranty and
the Guaranteed Agreements, or as a result of making the Loans; and any
extensions, renewals or amendments of any of the foregoing, however created,
acquired, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, including any
interest thereon, plus reasonable attorneys' fees and expenses if the
obligations represented by this Guaranty are collected by law, through an
attorney-at-law, or under advice therefrom (all of the foregoing obligations
(i), (ii), and (iii) being hereinafter collectively referred to as the
"Obligations"). Each Obligation shall rank pari passu with each other
Obligation.
Each Guarantor and the Administrative Agent hereby further agree that:
1. Regardless of whether any proposed guarantor or any other Person or
Persons is or are or shall become in any other way responsible to the
Administrative Agent, the Banks and the Managing Agents, or any of them, for or
in respect of the Obligations or any part thereof, and regardless of whether or
not any Person or Persons now or hereafter responsible to the Administrative
Agent, the Banks and the Managing Agents, or any of them, for the Obligations or
any part thereof, whether under this Guaranty or otherwise, shall cease to be so
liable, each Guarantor hereby declares and agrees that this Guaranty shall be a
several obligation, shall be a continuing guaranty and shall be operative and
binding, and that such Guarantor shall have no right of subrogation with respect
to this Guaranty.
2. Upon this Guaranty's being executed and coming into the hands of the
Administrative Agent, this Guaranty shall be deemed to be finally executed and
delivered by each Guarantor and shall not be subject to or affected by any
promise or condition affecting or limiting such Guarantor's liability, and no
statement, representation, agreement or promise on the part of the
Administrative Agent, the Banks, the Managing Agents and the Borrower, or any of
them, or any officer, employee or agent thereof, unless contained herein forms
any part of this Guaranty or
General Communication, Inc. - Form 8-K
Page 330
has induced the making hereof or shall be deemed in any way to affect any
Guarantor's liability hereunder.
3. No alteration or waiver of this Guaranty or of any of its terms,
provisions or conditions shall be binding upon the parties against whom
enforcement is sought unless made in writing and signed by an authorized officer
of such party.
4. The Administrative Agent, the Banks and the Managing Agents, or any of
them, may from time to time, without exonerating or releasing any Guarantor in
any way under this Guaranty, (i) take such further or other security or
securities for the Obligations or any part thereof as the Administrative Agent,
the Banks and the Managing Agents, or any of them, may deem proper, or (ii)
release, discharge, abandon or otherwise deal with or fail to deal with any
guarantor of the Obligations or any security or securities therefor or any part
thereof now or hereafter held by the Administrative Agent, the Banks and the
Managing Agents, or any of them, or (iii) amend, modify, extend, accelerate or
waive in any manner any of the provisions, terms, or conditions of the
Guaranteed Agreements, all as the Administrative Agent, the Banks and the
Managing Agents, or any of them, may consider expedient or appropriate in their
sole discretion. Without limiting the generality of the foregoing, or of Section
5 hereof, it is understood that the Administrative Agent, the Banks and the
Managing Agents, or any of them, may, without exonerating or releasing any
Guarantor, give up, or modify or abstain from perfecting or taking advantage of
any security for the Obligations and accept or make any compositions or
arrangements, and realize upon any security for the Obligations when, and in
such manner, as the Administrative Agent, the Banks and the Managing Agents, or
any of them, may deem expedient, all without notice to any Guarantor.
5. Each Guarantor acknowledges and agrees that no change in the nature or
terms of the Obligations or any of the Guaranteed Agreements, or other
agreements, instruments or contracts evidencing, related to or attendant with
the Obligations (including any novation), shall discharge all or any part of the
liabilities and obligations of such Guarantor pursuant to this Guaranty; it
being the purpose and intent of each Guarantor, the Administrative Agent, the
Banks and the Managing Agents that the covenants, agreements and all liabilities
and obligations of such Guarantor hereunder are absolute, unconditional and
irrevocable under any and all circumstances. Without limiting the generality of
the foregoing, each Guarantor agrees that until each and every one of the
covenants and agreements of this Guaranty is fully performed, such Guarantor's
undertakings hereunder shall not be released, in whole or in part, by any action
or thing which might, but for this section of this Guaranty, be deemed a legal
or equitable discharge of a surety or guarantor, or by reason of any waiver,
omission of the Administrative Agent, the Banks and the Managing Agents, or any
of them, or their failure to proceed promptly or otherwise, or by reason of any
action taken or omitted by the Administrative Agent, the Banks and the Managing
Agents, or any of them, whether or not such action or failure to act varies or
increases the risk of, or affects the rights or remedies of, such Guarantor or
by reason of any further dealings between the Borrower, the Administrative
Agent, the Banks and the Managing Agents, or any of them, or any other guarantor
or
General Communication, Inc. - Form 8-K
Page 331
surety, and each Guarantor hereby expressly waives and surrenders any defense to
its liability hereunder, or any right of counterclaim or offset of any nature or
description which it may have or which may exist based upon, and shall be deemed
to have consented to, any of the foregoing acts, omissions, things, agreements
or waivers.
6. The Administrative Agent, the Banks and the Managing Agents, or any of
them, may, without demand or notice of any kind upon or to the Guarantors, at
any time or from time to time when any amount shall be due and payable hereunder
by any Guarantor, if the Borrower shall not have timely paid its Obligations,
set off and appropriate any property, balances, credit accounts or moneys of any
Guarantor in the possession of the Administrative Agent, the Banks, the Managing
Agents, or any of them, or under any of their control for any purpose, which
property, balances, credit accounts or moneys shall thereupon be turned over and
remitted to the Administrative Agent, to be held and applied to the Obligations
by the Administrative Agent.
7. The creation or existence from time to time of Obligations in excess of
the amount committed to or outstanding on the date of this Guaranty is hereby
authorized, without notice to the Guarantors, and shall in no way impair or
affect this Guaranty or the rights of the Administrative Agent, the Banks and
the Managing Agents, or any of them, herein. Each Guarantor's obligations
hereunder shall be in, but not in excess of, the Maximum Guaranteed Amount. The
"Maximum Guaranteed Amount" shall mean for each Guarantor the greater of (a) the
amount of economic benefit received (directly or indirectly) by such Guarantor
pursuant to the Loan Agreement, and the other Loan Documents, or (b) the maximum
amount which would be paid out by such Guarantor without rendering this Guaranty
void or voidable under Applicable Laws including, without limitation, (i) the
Bankruptcy Code of 1978, as amended, and (ii) applicable state laws regarding
fraudulent conveyances, corporate distributions or insolvency.
8. Upon the bankruptcy or winding up or other distribution of assets of the
Borrower or any Guarantor or of any surety or guarantor for any Obligations of
the Borrower to the Administrative Agent, the Banks and the Managing Agents, or
any of them, the rights of the Administrative Agent, the Banks and the Managing
Agents against any Guarantor shall not be affected or impaired by the omission
of the Administrative Agent, the Banks and the Managing Agents, or any of them,
to prove its or their claim, as appropriate, or to prove its or their full
claim, as appropriate, and the Administrative Agent, the Banks and the Managing
Agents may prove such claims as they see fit and may refrain from proving any
claim and in their respective discretion they may value as they see fit or
refrain from valuing any security held by the Administrative Agent, the Banks
and the Managing Agents, or any of them, without in any way releasing, reducing
or otherwise affecting the liability to the Administrative Agent, the Banks and
the Managing Agents of any Guarantor.
9. Each Guarantor hereby expressly waives, to the fullest extent permitted
by Applicable Law: (a) notice of acceptance of this Guaranty, (b) notice of the
existence or creation of all or any of the Obligations, (c) presentment, demand,
notice
General Communication, Inc. - Form 8-K
Page 332
of dishonor, protest, and all other notices whatsoever, (d) all diligence in
collection or protection of or realization upon the Obligations or any part
thereof, any obligation hereunder, or any security for any of the foregoing, (e)
all rights of subrogation, indemnification, contribution and reimbursement
against the Borrower, (f) all rights to enforce any remedy the Administrative
Agent, the Banks and the Managing Agents, or any of them, may have against the
Borrower, and (g) any benefit of, or right to participate in, any collateral or
security now or hereinafter held by the Administrative Agent, the Banks and the
Managing Agents, or any of them, in respect of the Obligations, even upon
payment in full of the Obligations, except to the extent such waiver would be
expressly prohibited by Applicable Law. If a claim is ever made upon the
Administrative Agent, the Banks and the Managing Agents, or any of them, for the
repayment or recovery of any amounts or amounts received by any of them in
payment of any of the Obligations and such Person repays all or part of such
amount by reason of (i) any judgment, decree, or order of any court or
administrative body having jurisdiction over such Person or any of its property,
or (ii) any settlement or compromise of any such claim effected in good faith by
such Person with any such claimant, including the Borrower, then in such event
each Guarantor agrees that any such judgment, decree, order, settlement, or
compromise shall be binding upon such Guarantor, notwithstanding any revocation
hereof or the cancellation of any promissory note or other instrument evidencing
any of the Obligations, and each Guarantor shall be and remain obligated to such
Person hereunder for the amount so repaid or recovered to the same extent as if
such amount had never originally been received by such Person.
10. The Administrative Agent, the Banks and the Managing Agents may each,
to the extent permitted under the Loan Agreement, and without notice of any
kind, sell, assign or transfer all or any of the Obligations, and in such event
each and every immediate and successive assignee, transferee, or holder of all
or any of the Obligations, shall have the right to enforce this Guaranty, by
suit or otherwise, for the benefit of such assignee, transferee or holder as
fully as if such assignee, transferee or holder were herein by name specifically
given such rights, powers and benefits.
11. No delay by the Administrative Agent, the Banks and the Managing
Agents, or any of them, in the exercise of any right or remedy shall operate as
a waiver thereof, and no single or partial exercise by the Administrative Agent,
the Banks and the Managing Agents, or any of them, of any right or remedy shall
preclude other or further exercise thereof or the exercise of any other right or
remedy. No action by the Administrative Agent, the Banks and the Managing
Agents, or any of them, permitted hereunder shall in any way impair or affect
this Guaranty. For the purpose of this Guaranty, the Obligations shall include,
without limitation, all Obligations of the Borrower to the Administrative Agent,
the Banks and the Managing Agents, notwithstanding any right or power of any
third party, individually or in the name of the Borrower or any other Person, to
assert any claim or defense as to the invalidity or unenforceability of any such
Obligation, and no such claim or defense shall impair or affect the obligations
of any Guarantor hereunder.
General Communication, Inc. - Form 8-K
Page 333
12. This Guaranty shall be binding upon each Guarantor, its successors and
assigns and inure to the benefit of the successors and assigns of the
Administrative Agent, the Banks and the Managing Agents. Each Guarantor shall
not assign its rights or obligations under this Guaranty; nor shall any
Guarantor amend this Guaranty, except with the written approval of the
Administrative Agent delivered to the Guarantors.
13. This is a Guaranty of payment and not of collection. In the event the
Administrative Agent makes a demand upon any Guarantor under this Guaranty, such
Guarantor shall be held and bound to the Administrative Agent, the Banks and the
Managing Agents directly as debtor in respect of the payment of the amounts
hereby guaranteed. All reasonable costs and expenses, including reasonable
attorneys' fees and expenses, incurred by the Administrative Agent, the Banks
and the Managing Agents, or any of them, in obtaining performance of or
collecting payments due under this Guaranty shall be deemed part of the
Obligations guaranteed hereby. Any notice or demand which the Administrative
Agent, the Banks and the Managing Agents may wish to give shall be served upon
the Guarantors in the fashion prescribed for notices in Section 11.1 of the Loan
Agreement to the Guarantors' last known places of address, and the notice so
sent shall be deemed to be served as set forth in Section 11.1 of the Loan
Agreement.
14. Each Guarantor expressly represents and acknowledges that any financial
accommodations by the Administrative Agent, the Banks and the Managing Agents,
or any of them, to the Borrower, including, without limitation, the extension of
the Loans, are and will be of direct interest, benefit and advantage to such
Guarantor.
15. Each Guarantor covenants and agrees that so long as any amount is owing
on account of Obligations or otherwise pursuant to this Guaranty, such Guarantor
shall permit representatives of the Administrative Agent, the Banks and the
Managing Agents during normal business hours after reasonable notice to visit
and inspect properties of such Guarantor, inspect such Guarantor's books and
records and discuss with the principal officers of such Guarantor its
businesses, assets, liabilities, financial positions, results of operations and
business prospects.
16. This Guaranty shall be construed and interpreted, and all rights and
obligations of the parties hereto determined, in accordance with the laws of the
State of New York without reference to the conflicts or choice of law principles
thereof.
[the rest of this page is intentionally blank]
General Communication, Inc. - Form 8-K
Page 334
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed as of
the date first above written.
Address: GCI CABLE/JUNEAU, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Address: GCI CABLE/FAIRBANKS, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Address: GCI CABLE HOLDINGS, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
Address: PRIME CABLE OF ALASKA, L.P.
By: GCI CABLE, INC.
Its: General Partner
By: /s/ John M. Lowber
Its: Secretary/Treasurer
General Communication, Inc. - Form 8-K
Page 335
EXHIBIT K
FORM OF
SUBSIDIARY SECURITY AGREEMENT
THIS SUBSIDIARY SECURITY AGREEMENT (the "Agreement") is entered into as
of the 31st day of October, 1996, by and between GCI Cable/Juneau, Inc., an
Alaska corporation; GCI Cable/Fairbanks, Inc., an Alaska corporation; GCI Cable
Holdings, Inc., an Alaska corporation; and Prime Cable of Alaska, L.P., a
Delaware limited partnership (collectively, the "Subsidiaries," and each, a
"Subsidiary") and Toronto Dominion (Texas), Inc. (the "Administrative Agent"),
as administrative agent for the Managing Agents and the Banks.
W I T N E S S T H :
WHEREAS, GCI Cable, Inc. (the "Borrower") the Administrative Agent, the
Managing Agents and the Banks have entered into that certain Loan Agreement
dated as of October 31, 1996 (as amended, supplemented or otherwise modified
from time to time, the "Loan Agreement") pursuant to which the Banks have agreed
to make loans (the "Loans") to the Borrower, which Loans are evidenced by the
promissory notes of the Borrower in favor of each Bank (as amended, modified,
renewed or extended from time to time, the "Notes");
WHEREAS, the making of the Loans will be of direct benefit and
advantage to the Subsidiaries, which have issued their Subsidiary Guaranty of
the Loans, of even date (as amended, modified, renewed or extended from time to
time, the "Guaranty"); and
WHEREAS, to secure the due and punctual payment and performance of
their obligations under the Guaranty and the other Obligations (as defined
below), the Subsidiaries, each direct or indirect wholly-owned Subsidiary of the
Borrower, have entered into this Agreement;
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto hereby agree that all capitalized terms
used herein shall have the meanings ascribed to such terms in the Loan Agreement
to the extent not otherwise defined or limited herein, and further agree as
follows:
A. Security Interest. Each Subsidiary hereby grants, conveys, transfers
and assigns to the Administrative Agent, for the ratable benefit of the Banks, a
continuing security interest in and security title to (hereinafter referred to
as the
General Communication, Inc. - Form 8-K
Page 336
"Security Interest") all of their respective property, whether now owned or
hereafter created, acquired or reacquired by such Subsidiary, including, without
limitation, the property described below and all substitutions therefor,
accessions thereto, and improvements thereon:
1. Inventory. All of such Subsidiary's inventory of
whatever nature and kind and wherever situated, including, without
limitation, converters, coaxial cables and hardware, raw materials,
components, work in process, finished goods, goods in transit, and
packing and shipping materials, accretions and accessions thereto, and
trust receipts and similar documents covering the same products (the
"Inventory");
2. Equipment. All machinery and equipment not
included in Inventory above, including, without limitation, motor
vehicles and all accretions and accessions thereto; CATV towers,
antennas, and equipment located at head-end facilities; distribution
systems consisting of pole hardware, strand, coaxial cables, electronic
amplifiers, associated passive devices and subscriber service drops
incident to normal CATV service; test equipment; all equipment used in
the specialized mobile radio business; and closed circuit program
origination equipment (the "Equipment");
3. Accounts. All right to payment for goods sold or
leased or for services rendered, including, without limitation, the
provision of cable television services, which is not evidenced by an
instrument or chattel paper, whether or not it has been earned by
performance, including, without limitation, all agreements with
subscribers, and all books and records recording, evidencing, or
relating to such accounts or any part thereof (the "Accounts");
4. Contracts and Leases. To the extent that such
Subsidiary may grant a security interest therein without violating a
valid and enforceable restriction on the granting of a security
interest contained therein:
a. all construction contracts, Pole Agreements,
and public utility contracts to which such Subsidiary
is a party, whether now existing or hereafter arising
(the "Contracts");
b. all lease agreements for real property or
personal property to which such Subsidiary is a party
(the "Leases"), whether now existing or hereafter
arising;
c. all other contracts and contractual rights,
remedies, or provisions now existing or hereafter
arising in favor of such Subsidiary (the "Other
Contracts");
5. General Intangibles. All of such Subsidiary's
general intangibles (including, without limitation, any proceeds from
insurance policies
General Communication, Inc. - Form 8-K
Page 337
after payment of prior interests), patents, unpatented inventions,
trade secrets, copyrights, contract rights, goodwill, literary rights,
rights to performance, rights under licenses, choses-in-action, claims,
information contained in computer media (such as data bases, source and
object codes, and information therein) things in action, trademarks and
trademarks applied for (together with the goodwill associated
therewith) and derivatives thereof, trade names, including the right to
make, use, and vend goods utilizing any of the foregoing, and permits,
licenses, certifications, authorizations and approvals, (to the extent
that such Subsidiary may grant a security interest therein without the
consent of the granting party) and the rights of such Subsidiary
thereunder, issued by any governmental, regulatory, or private
authority, agency, or entity whether now owned or hereafter acquired,
together with all cash and non-cash proceeds and products thereof (the
"Intangibles");
6. Licenses. Subject to Section 22 hereof, and to the
extent (i) permitted by Applicable Law, or (ii) that such Subsidiary
may grant a security interest therein without violating a valid and
enforceable restriction on the granting of a security interest
contained therein, all franchises, licenses, permits, and operating
rights authorizing or relating to such Subsidiary's rights to construct
and operate cable and pay-cable television facilities, including,
without limitation, the Licenses held by such Subsidiary, including,
without limitation, those described on Exhibit A attached hereto (the
"Licenses");
7. Furniture and Fixtures. All furniture and fixtures
in which such Subsidiary has an interest (the "Furniture and
Fixtures");
8. Miscellaneous Items. All goods, chattel paper,
documents, instruments, choses in action, claims, money, deposits,
certificates of deposit, stock or share certificates, licenses and
other rights in intellectual property, and other tangible personal
property not included above ("Miscellaneous Items"); and
9. Proceeds. All proceeds of any of the above, and
all proceeds of any loss of, damage to, or destruction of the above,
whether insured or not insured, and all other proceeds of any sale,
lease, or other disposition of any property or interest therein
referred to above, together with all proceeds of any policies of
insurance covering any or all of the above, the proceeds of any award
in condemnation with respect to any of the property of such Subsidiary,
any rebates or refunds, whether for taxes or otherwise, and all
proceeds of any such proceeds (the "Proceeds").
The Inventory, Equipment, Accounts, Contracts, Other Contracts, Leases,
Intangibles, Licenses, Furniture and Fixtures, Miscellaneous Items, and Proceeds
thereof, as described above, are hereinafter collectively referred to as the
"Collateral."
General Communication, Inc. - Form 8-K
Page 338
This Agreement and the Security Interest secure payment and performance
of all obligations of the Subsidiaries to the Administrative Agent and the Banks
under the Guaranty and any extensions, renewals or amendments thereto, however
created, acquired, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, together with
any and all other Obligations under the Loan Agreement (all of the foregoing
obligations being hereinafter collectively referred to as the "Obligations").
B. Further Assurances. Each Subsidiary agrees to make, execute, deliver
or cause to be done, executed, and delivered, from time to time, all such
further acts, documents and things as the Administrative Agent on behalf of the
Managing Agents and the Banks, may reasonably require for the purpose of
perfecting or protecting its or their rights hereunder or otherwise giving
effect to this Agreement, all within thirty (30) days following the request
therefor. In addition, each Subsidiary hereby authorizes the Administrative
Agent upon such Subsidiary's failure to do so, to file such financing statements
and such other documents as the Administrative Agent may deem necessary or
desirable to protect or perfect the interest of the Administrative Agent, for
itself and on behalf of the Managing Agents and the Banks in the Collateral, and
each Subsidiary further irrevocably appoints the Administrative Agent as such
Subsidiary's attorney-in-fact, with power of attorney to execute on behalf of
such Subsidiary such UCC financing statement forms as the Administrative Agent
may from time to time deem necessary or desirable. Such power of attorney is
coupled with an interest and shall be irrevocable for so long as any of the
Obligations remains unpaid or unperformed or any of the Banks have any
obligations to make Advances under the Loan Agreement, regardless of whether the
conditions precedent to the making of any such Advances have been or can be
fulfilled.
C. Representations and Warranties. Each Subsidiary represents
and warrants to the Administrative Agent, the Managing Agents and the Banks
that:
(a) the execution of this Agreement and the fulfillment of the
terms hereof will not result in a breach of any of the terms or
provisions of, or constitute a default under, such Subsidiary's
Certificate or Articles of Incorporation or Bylaws, or its Partnership
Agreement or Certificate of Limited Partnership, as the case may be, as
presently in effect, or any order, rule or regulation applicable to
such Subsidiary of any court or of any Federal or state regulatory body
or administrative agency or other governmental body having jurisdiction
over such Subsidiary, or result in the termination or cancellation or
material breach of any indenture, mortgage, deed of trust, deed to
secure debt, lease or other agreement or instrument to which such
Subsidiary is a party or by which it is bound or affected;
(b) such Subsidiary has taken all necessary corporate or
partnership action to authorize the execution and delivery of this
Agreement, and this Agreement, when executed and delivered, will be the
valid and binding obligation of such Subsidiary enforceable in
accordance with its terms, subject only to the following
qualifications:
General Communication, Inc. - Form 8-K
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(i) certain equitable remedies are discretionary and, in
particular, may not be available where damages are considered
an adequate remedy at law,
(ii) enforcement may be limited by bankruptcy, insolvency,
liquidation, reorganization, reconstruction and other similar
laws affecting enforcement of creditors' rights generally
(insofar as any such law relates to the bankruptcy, insolvency
or similar event of such Subsidiary), and
(iii) enforcement as to the Licenses may be limited by FCC
rules and regulations restricting the transfer of such
Licenses.
(c) Exhibit B attached hereto and incorporated herein by this
reference sets forth a complete and accurate list of the Pole
Agreements and utility agreements in effect on the date hereof, and
such Subsidiary has furnished or will furnish copies thereof to the
Administrative Agent, the Managing Agents and the Banks; and
(d) Exhibit C attached hereto and incorporated herein by this
reference sets forth a complete and accurate list of all Leases for
real property and all material Capitalized Lease Obligations to which
such Subsidiary is a party in effect on the date hereof, and each
Subsidiary has furnished or will furnish copies thereof to the
Administrative Agent, the Managing Agents and the Banks.
D. Priority of Security Interest. Each Subsidiary further
represents and warrants that the Security Interest in the Collateral granted to
the Administrative Agent hereunder shall constitute at all times a valid first
priority security interest in favor of the Administrative Agent in and upon the
Collateral, subject only to Permitted Liens. Each Subsidiary shall take or cause
to be performed such acts and actions as shall be necessary or appropriate to
assure that the Security Interest upon the Collateral shall not become
subordinate or junior to the security interests, Liens or claims of any other
Person, except for Permitted Liens.
E. Locations of Collateral. Each Subsidiary further represents
and warrants that it now keeps all of its records concerning the Collateral
either at its chief executive office or at its principal place or places of
business, each of which addresses are shown on Schedule 1 hereto. Schedule 1
also contains for each Subsidiary a list of locations at which Collateral (other
than the distributed physical cable plant) is located. Each Subsidiary covenants
and agrees that it shall not keep any of such records or Collateral at any other
address unless written notice thereof is given to the Administrative Agent at
least thirty (30) days prior to the effective date of any new address for the
keeping of such records. Each Subsidiary further agrees that it shall
immediately advise the Administrative Agent in writing making reference to this
Section 5 of this Agreement, of the opening of any new place of business, the
General Communication, Inc. - Form 8-K
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closing of any existing place of business, or any change in the location of the
place where it keeps the Collateral.
F. Collateral Not Fixtures. The parties intend that, to the
extent permitted by Applicable Law, the Collateral shall remain personal
property irrespective of the manner of its attachment or affixation to realty.
G. Risk of Loss, Sale of Collateral. Any and all injury to, or
loss or destruction of, the Collateral shall be at each Subsidiary's risk, and
shall not release such Subsidiary from its obligations hereunder. Except as
permitted under the Loan Agreement, each Subsidiary agrees not to sell,
transfer, assign, dispose of, mortgage, grant a security interest in, or
encumber any of the Collateral in any manner without the prior written consent
of those Persons required under Section 11.13 of the Loan Agreement. Each
Subsidiary further agrees that the Administrative Agent may, but shall in no
event be obligated to, insure any of the Collateral in such form and amount as
the Administrative Agent may deem necessary or desirable if such Subsidiary
fails to obtain insurance as required by the Loan Agreement, and that the
Administrative Agent may pay or discharge any taxes, liens, or encumbrances
which are not Permitted Liens on any of the Collateral, and such Subsidiary
agrees to pay upon demand any such sum so expended by the Administrative Agent
with interest at the Default Rate, and such sums and interest shall be deemed to
be a part of the Obligations secured by the Collateral under the terms of this
Agreement.
H. Covenants of Subsidiaries. Each Subsidiary shall (i)
fulfill, perform and observe each and every material condition and covenant
contained in any of the material Contracts, the Other Contracts, or the Leases,
(ii) give prompt notice to the extent required under the Loan Agreement to the
Administrative Agent, the Managing Agents and the Banks of any claim of material
default under any of the Contracts, the Other Contracts, or the Leases given to
such Subsidiary or by such Subsidiary, (iii) at the sole cost and expense of
such Subsidiary, enforce the performance and observance of each and every
material covenant and condition of the material Contracts, the Other Contracts,
or the Leases to be performed or observed by other parties to any of the
material Contracts, the Other Contracts, or Leases, and (iv) appear in, defend
and, as appropriate, settle any action growing out of or in any manner connected
with any Contract, Other Contract, or Lease; provided, however, that prior to
the occurrence of an Event of Default (which remains uncured or unwaived), such
Subsidiary may issue or obtain waivers in the ordinary course of business with
respect to items (i) and (iii). The rights and interests transferred and
assigned to the Administrative Agent hereunder include all of each Subsidiary's
right and title (i) to modify the Contracts, the Other Contracts, and Leases,
(ii) to terminate the Contracts, the Other Contracts, and the Leases, and (iii)
to waive or release the performance or observance of any obligation or condition
of the Contracts, the Other Contracts, and the Leases; provided, however, that
these rights of the Administrative Agent shall not be exercised unless an Event
of Default shall exist.
I. Remedies. Upon the occurrence of an Event of Default and
until such Event of Default is waived in writing in accordance with Section
11.13 of the Loan
General Communication, Inc. - Form 8-K
Page 341
Agreement (or, if prior to acceleration or the exercise of any other remedies
pursuant to Section 8.2 of the Loan Agreement, cured), the Administrative Agent
shall have such rights and remedies as are set forth in the Loan Agreement and
herein, all the rights, powers and privileges of a secured party under the
Uniform Commercial Code of the State of New York and any other applicable
jurisdiction; and all other rights and remedies available to the Administrative
Agent, at law or in equity. Each Subsidiary covenants and agrees that any
notification of intended disposition, including any public or private sale, of
any Collateral, if such notice is required by law, shall be deemed reasonably
and properly given if given in the manner provided for in Section 19 hereof at
least ten (10) Business Days prior to such disposition. Upon the occurrence of
an Event of Default and until such Event of Default is waived in writing in
accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Administrative Agent upon the written request of
the Majority Banks, shall have the right to the appointment of a receiver for
the properties and assets of any Subsidiary, and each such Subsidiary hereby
consents to such rights and such appointment and hereby waives any objection
such Subsidiary may have thereto or the right to have a bond or other security
posted by the Administrative Agent in connection therewith.
J. Administrative Agent's Right to Perform Contracts. Upon the
occurrence of an Event of Default and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Administrative Agent may proceed to perform any
and all of the obligations of each Subsidiary contained in any of the Contracts,
the Other Contracts, or the Leases and exercise any and all rights of each
Subsidiary therein contained as fully as the Subsidiary itself could. Each
Subsidiary hereby appoints the Administrative Agent its attorney-in-fact,
effective upon the occurrence of an Event of Default and until such Event of
Default is waived in writing in accordance with Section 11.13 of the Loan
Agreement (or, if prior to acceleration or the exercise of any other remedies
pursuant to Section 8.2 of the Loan Agreement, cured), with power of
substitution, to take such action, execute such documents, and perform such
work, as the Administrative Agent may deem appropriate in exercise of the rights
and remedies granted the Administrative Agent herein. The powers herein granted
shall include, but not be limited to, powers to sue on the Contracts, the Other
Contracts, or the Leases and to seek all governmental approvals required for the
operation of the System (or any portion thereof). The power of attorney granted
herein is coupled with an interest and shall be irrevocable for so long as any
of the Obligations remains unpaid or unperformed or any of the Banks have any
obligation to make Advances under the Loan Agreement, regardless of whether the
conditions precedent to the making of any such Advances have been or can be
fulfilled.
K. Right to Cure Subsidiary's Default Under Contracts. Upon
the occurrence of an Event of Default and until such Event of Default is waived
in writing in accordance with Section 11.13 of the Loan Agreement (or, if prior
to acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan
General Communication, Inc. - Form 8-K
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Agreement, cured), should any Subsidiary fail to perform or observe any material
covenant or comply with any material condition contained in any of the
Contracts, the Other Contracts, or the Leases, then the Administrative Agent,
but without obligation to do so and without releasing such Subsidiary from its
obligation to do so, may perform such covenant or condition and, to the extent
that the Administrative Agent shall incur any costs or pay any expenses in
connection therewith, including any costs or expenses of litigation associated
therewith, such costs, expenses, or payments shall be included in the
Obligations secured hereby and shall bear interest from the payment of such
costs or expenses at the Default Rate. Anything herein to the contrary
notwithstanding (a) each Subsidiary shall remain liable under the Contracts, the
Other Contracts, the Leases and all other contracts and agreements included in
the Collateral to the same extent set forth therein to perform all of the duties
and obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Administrative Agent of any of the rights
hereunder shall not release any Subsidiary from any of its duties or obligations
under the Contracts, the Other Contracts, the Leases or any other contract or
agreements included in the Collateral, and (c) none of the Administrative Agent,
any Managing Agent, nor any Bank, shall be obligated to perform or discharge any
obligation of any Subsidiary under any of the Contracts, the Other Contracts,
the Leases, or any other contracts or agreements included in the Collateral and,
each Subsidiary agrees to indemnify and hold the Administrative Agent, the
Managing Agents, and the Banks harmless against any and all liability, loss, and
damage which the Administrative Agent, the Managing Agents, and the Banks, or
any of them, may incur under any of the Contracts, the Other Contracts, the
Leases or any other contracts or agreements included in the Collateral or under
or by reason of this Agreement, and any and all claims and demands whatsoever
which may be asserted against a Subsidiary by reason of an act of any of the
Administrative Agent, the Managing Agents, or the Banks under any of the terms
of this Agreement or under the Contracts, the Other Contracts or the Leases;
unless, with respect to any of the above, the party seeking indemnification is
finally judicially determined to have acted with gross negligence or wilful
misconduct.
L. Agent Attorney-in-Fact. Each Subsidiary hereby further
appoints the Administrative Agent as its attorney-in-fact, effective upon the
occurrence of an Event of Default and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement (or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), with power of substitution, and with authority to
receive, open, and take appropriate action with respect to all mail addressed to
such Subsidiary, and to notify the postal authorities to change the address for
delivery of mail addressed to such Subsidiary to such address as the
Administrative Agent may designate, to endorse the name of such Subsidiary on
any note, acceptance, check, draft, money order, or other evidence of debt or of
payment which may come into the possession of any of the Administrative Agent,
the Managing Agents and the Banks, and generally to do such other things and
acts in the name of such Subsidiary as are necessary or appropriate to protect
or enforce the rights hereunder of the Administrative Agent, the Managing
Agents, and the Banks. Each Subsidiary further authorizes the Administrative
Agent effective upon the occurrence of an Event of Default and until such Event
of Default is waived
General Communication, Inc. - Form 8-K
Page 343
in writing in accordance with Section 11.13 of the Loan Agreement (or, if prior
to acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), to compromise and settle or to sell, assign, or
transfer or to ask, collect, receive, or issue any and all claims possessed by
such Subsidiary all in the name of such Subsidiary. After deducting all
reasonable expenses and charges (including the Administrative Agent's reasonable
attorneys' fees) of retaking, keeping, storing, and selling the Collateral, the
Administrative Agent shall apply the proceeds in payment of any of the
Obligations in such order of application as is set forth in the Loan Agreement,
and, if a deficiency results after such application, each Subsidiary covenants
and agrees to pay such deficiency to the Administrative Agent. The power of
attorney granted herein is coupled with an interest and shall be irrevocable for
so long as any of the Obligations remains unpaid or unperformed or any of the
Banks have any obligation to make Advances under the Loan Agreement, regardless
of whether the conditions precedent to the making of any such Advances have been
or can be fulfilled. Each Subsidiary agrees that if steps are taken by the
Administrative Agent to enforce rights hereunder, or to realize upon any of the
Collateral, such Subsidiary shall pay to the Administrative Agent the amount of
the costs, including reasonable attorneys' fees, incurred in connection with
such enforcement, and such Subsidiary's obligation to pay such amounts shall be
deemed to be a part of the Obligations secured hereunder.
M. Indemnification. Each Subsidiary shall indemnify and hold
harmless the Administrative Agent, the Managing Agents, and the Banks, and each
of them, and any other Person acting hereunder for all losses, costs, damages,
fees, and expenses whatsoever associated with the exercise of the powers of
attorney granted herein and shall release the Administrative Agent, the Managing
Agents, and the Banks and any other Person acting hereunder from all liability
whatsoever for the exercise of the foregoing powers of attorney and all actions
taken pursuant thereto, unless in any such event such Person seeking
indemnification hereunder is finally judicially determined to have acted or
failed to act with gross negligence or willful misconduct.
N. Rights Cumulative. Each Subsidiary agrees that the rights
of the Administrative Agent, the Managing Agents, and the Banks under this
Agreement, the Loan Agreement, the other Loan Documents, or any other contract
or agreement now or hereafter in existence between the Administrative Agent, the
Managing Agents, and the Banks, or any of them, and such Subsidiary shall be
cumulative and that the Administrative Agent may from time to time exercise such
rights and such remedies as the Administrative Agent may have thereunder and
under the laws of the United States and any state, as applicable, in the manner
and at the time that the Administrative Agent, the Managing Agents and the Banks
in their sole discretion desire. Each Subsidiary further expressly agrees that
none of the Administrative Agent, the Managing Agents and the Banks shall in any
event be under any obligation to resort to any Collateral prior to exercising
any other rights that the Administrative Agent, the Managing Agents and the
Banks, or any of them, may have against such Subsidiary or its property, or to
resort to any other collateral for the Obligations prior to the exercise of
remedies hereunder.
General Communication, Inc. - Form 8-K
Page 344
O. Receivership. Each Subsidiary hereby acknowledges that the
Obligations arose out of a commercial transaction, and agrees that if an Event
of Default shall occur, hereunder (and until such Event of Default is waived in
writing in accordance with Section 11.13 of the Loan Agreement or, if prior to
acceleration or the exercise of any other remedies pursuant to Section 8.2 of
the Loan Agreement, cured), the Administrative Agent shall have the right to an
immediate writ of possession without notice of a hearing, and hereby knowingly
and intelligently waives any and all rights it may have to any notice and
posting of a bond by the Administrative Agent, the Managing Agents, and the
Banks, or any of them, prior to seizure by the Administrative Agent or any of
its transferees, assigns, or successors in interest, of the Collateral or any
portion thereof.
P. Remedies Not Exclusive. No transfer or renewal, extension,
assignment, or termination of this Agreement, the Loan Agreement, any other Loan
Document, or any other instrument or document executed and delivered by any
Subsidiary or any other obligor to the Administrative Agent, the Managing
Agents, and the Banks, or any of them, nor any additional Advances made by the
Banks to the Borrower, nor the taking of further security, nor the retaking or
redelivery of the Collateral to such Subsidiary by any of the Administrative
Agent, the Managing Agents and the Banks, nor any other act of any of the
Administrative Agent, the Managing Agents and the Banks shall release such
Subsidiary from any Obligation, except a release or discharge executed in
writing by the Administrative Agent, the Managing Agents and the Banks (as and
to the extent required under the Loan Agreement) with respect to such Obligation
or payment of such Obligation or upon full payment to the Administrative Agent,
the Managing Agents and the Banks and satisfaction of all the Obligations.
Neither the Administrative Agent, the Managing Agents nor the Banks shall by any
act, delay, omission or otherwise, be deemed to have waived any of their rights
or remedies hereunder, unless such waiver is in writing and signed by the
Administrative Agent, and, as required by the Loan Agreement, the Managing
Agents and the Banks and then only to the extent therein set forth. A waiver by
the Administrative Agent, the Managing Agents and the Banks, or any of them, of
any right or remedy on any occasion shall not be construed as a bar to the
exercise of any such right or remedy which any of the Administrative Agent, the
Managing Agents and the Banks would otherwise have had on any other occasion.
Q. Assignment. Each Subsidiary agrees that this Agreement and
rights of the Administrative Agent, the Managing Agents and the Banks hereunder
may in the discretion of such Person be assigned in whole or in part by such
Person in connection with any permitted assignment of such Person's interest in
the Loan Agreement or the Obligations. In the event this Agreement is so
assigned by any of the Administrative Agent, the Managing Agents and the Banks,
the terms "Administrative Agent," "Managing Agent,""Managing Agents," "Bank" and
"Banks" wherever used herein shall be deemed to refer to and include any such
assignee or assignees, as appropriate. This Agreement may not be assigned by any
Subsidiary without the prior written consent of each Bank.
General Communication, Inc. - Form 8-K
Page 345
R. Successors and Assigns. This Agreement shall apply to and
bind the respective successors and permitted assigns of each Subsidiary and
inure to the benefit of the respective successors and assigns of the
Administrative Agent, the Managing Agents and the Banks.
S. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be given in a manner
prescribed and to the addresses set forth in Section 11.1 of the Loan Agreement.
T. Governing Law, Etc. The provisions of this Agreement shall
be construed and interpreted, and all rights and obligations of the parties
hereto determined, in accordance with the laws of the State of New York without
reference to the conflicts or choice of law principles thereof. This Agreement,
together with all documents referred to herein, constitutes the entire Agreement
between the Subsidiaries, the Administrative Agent, the Managing Agents, and the
Banks with respect to the matters addressed herein, and may not be modified
except by a writing executed by the Administrative Agent and the Subsidiaries.
U. Severability. If any paragraph or part hereof shall for any
reason be held or adjudged to be invalid, illegal, or unenforceable by any court
of competent jurisdiction, such paragraph or part hereof so adjudicated invalid,
illegal or unenforceable shall be deemed separate, distinct and independent, and
the remainder of this Agreement shall remain in full force and effect and shall
not be affected by such holding or adjudication.
V. FCC Consent. Notwithstanding anything herein which may be
construed to the contrary, no action shall be taken by any of the Administrative
Agent, the Managing Agents or the Banks with respect to the Licenses or any
license of the Federal Communications Commission ("FCC") unless and until all
requirements of Applicable Law, including, without limitation, any required
approval of either of the Alaska Public Utilities Commission or the U.S.
Government (together the "Licensors") and any required approval under the
Federal Communications Act of 1934, and any applicable rules and regulations
thereunder, requiring the consent to or approval of such action by either of the
Licensors, the FCC or any other governmental or other authority, have been
satisfied. Each Subsidiary covenants that upon request of the Administrative
Agent it will cause to be filed such applications and take such other action as
may be requested by such Person or Persons to obtain consent or approval of
either of the Licensors, the FCC or any other governmental or other authority
which has granted any License to such Subsidiary to any action contemplated by
this Agreement and to give effect to the Security Interest of the Administrative
Agent, including, without limitation, the execution of an application for
consent by the FCC to an assignment or transfer involving a change in ownership
or control pursuant to the provisions of the Federal Communications Act of 1934.
To the extent permitted by Applicable Law, the Administrative Agent is hereby
irrevocably appointed the true and lawful attorney-in-fact of each Subsidiary,
in its name and stead, to execute and file all necessary applications with the
Licensors, the FCC and with any other governmental or other authority. The power
of attorney
General Communication, Inc. - Form 8-K
Page 346
granted herein is coupled with an interest and shall be irrevocable for so long
as any of the Obligations remains unpaid or unperformed or any of the Banks have
any obligation to make Advances under the Loan Agreement, regardless of whether
the conditions precedent to the making of any such Advances has been or can be
fulfilled.
W. Termination and Release. Upon satisfaction in full of the
Obligations (other than any Obligation which may survive the termination of the
Loan Agreement as provided for therein) and termination of the Commitment, the
Administrative Agent shall take any actions reasonably necessary to terminate
and release the security interest in the Collateral granted to the
Administrative Agent hereunder, all at the cost and expense of the Subsidiaries.
X. Administrative Agent. Each reference herein to any right
granted to, benefit conferred upon, or power exercisable by the "Administrative
Agent" shall be a reference to the Administrative Agent (including any
successors to the Administrative Agent pursuant to the Loan Agreement) for
itself and for the ratable benefit of the Managing Agents and the Banks, and
each action taken or right exercised hereunder shall be deemed to have been so
taken or exercised by the Administrative Agent for itself and for the benefit of
and on behalf of all of the Managing Agents and the Banks.
Y. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
[the rest of this page is intentionally blank]
General Communication, Inc. - Form 8-K
Page 347
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed, by and through their duly authorized representatives, as of the day
and year first written above.
SUBSIDIARIES:
GCI CABLE/JUNEAU, INC. By: /s/ John M. Lowber
Its: Secretary/Treasurer
GCI CABLE/FAIRBANKS, INC. By: /s/ John M.
Lowber
Its: Secretary/Treasurer
GCI CABLE HOLDINGS, INC. By: /s/ John M. Lowber
Its: Secretary/Treasurer
PRIME CABLE OF ALASKA, L.P. By: GCI CABLE, INC.
Its: General Partner
By: /s/ John M. Lowber
Title: Secretary/Treasurer
ADMINISTRATIVE AGENT:
TORONTO DOMINION (TEXAS), INC.
By: /s/ Jano Mott
Its: Vice President
EXHIBIT A - Licenses
EXHIBIT B - Pole and Utility Contracts
EXHIBIT C - Leases
SCHEDULE 1 - Each Subsidiary's Principal Place of Business and Locations of
Collateral
General Communication, Inc. - Form 8-K
Page 348
EXHIBIT L
FORM OF USE OF PROCEEDS LETTER
GCI CABLE, INC., an Alaska corporation (the "Borrower"), has requested
that, in connection with that certain Loan Agreement (as amended, supplemented
or otherwise modified from time to time, the "Loan Agreement"), dated as of
October 31, 1996, by and among the Borrower, the Banks (as defined therein),
Toronto Dominion (Texas), Inc., The Chase Manhattan Bank, N.A., Credit Lyonnais,
Cayman Island Branch, and NationsBank of Texas, N.A., as managing agents
(collectively, the "Managing Agents"), and Toronto Dominion (Texas), Inc. (the
"Administrative Agent"), as agent for the Managing Agents and the Banks, the
Banks make an Advance to the Borrower under the Loan Agreement on October 31,
1996 of Loans in the aggregate principal amount of $205,000,000.
The Borrower shall use the aggregate proceeds of such Advance made on
the Agreement Date: (i) to fund working capital, capital expenditures, and to
make Restricted Payments to the extent permitted under Section 7.7 of the Loan
Agreement; (ii) to pay (A) fees and expenses of the Borrower and (B) fees and
expenses of other parties which the Borrower and the Prior Borrower are
obligated to pay, in connection with the GCI Acquisition and Loan Agreement and
the transactions contemplated thereby; (iii) to finance the Rock and Cooke
Acquisitions; and (iv) as otherwise set forth on Schedule 1 attached hereto.
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
Dated as of the day of October 31, 1996.
GCI CABLE, INC.
By: /s/ John M. Lowber
Title: Secretary/Treasurer
Schedule 1 - Uses of Proceeds of Initial Advance
General Communication, Inc. - Form 8-K
Page 349
EXHIBIT M
FORM OF LOAN CERTIFICATE
BORROWER
I, John M. Lowber, do hereby certify that I am the duly elected and
qualified Secretary/Treasurer and keeper of the corporate records and corporate
seal of GCI Cable, Inc., a corporation organized and existing under the laws of
the State of Alaska (the "Borrower") . In connection with that certain Loan
Agreement dated October 31, 1996 (the "Loan Agreement") among the Borrower, the
Banks (as defined therein) (the "Banks"), Toronto Dominion (Texas), Inc.,
NationsBank of Texas, N.A., The Chase Manhattan Bank, N.A. and Credit Lyonnais,
New York Branch, as managing agents (collectively the "Managing Agents"), and
Toronto Dominion (Texas), Inc., as administrative agent for the Managing Agents
and the Banks (the "Administrative Agent"), I hereby certify to the
Administrative Agent, the Managing Agents and the Banks that:
(1) Attached hereto as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Borrower certified by the
Alaska Department of Commerce and Economic Development.
(2) Attached hereto as Exhibit B are certificates of good
standing issued by the Secretary of State or similar state official for each
state in which Borrower is incorporated or required to qualify to do business;
(3) Attached hereto as Exhibit C is a true, complete and
correct copy of the Bylaws of the Borrower;
(4) Attached hereto as Exhibit D is a true, complete and
correct copy of the corporate resolutions of the Borrower adopted by the
Borrower's Board of Directors on October 10, 1996; such corporate action having
been duly taken in accordance with the provisions of Applicable Law, the
Articles of Incorporation and the Bylaws, and such resolutions are now in full
force and effect, without any modifications in any respect. Such resolutions
authorize the Borrower to execute, deliver and perform the Loan Documents to
which it is a party;
(5) Attached hereto as Exhibit E is a true, complete and
correct copy of all shareholders' or other similar agreements or voting trust
agreements in effect with respect to the stock interest of the Borrower;
(6) Attached hereto as Exhibit F is a true, complete and
correct photocopy of the Licenses of the Borrower, together with all amendments
thereto, each of which is in full force and effect on the date hereof.
(7) Attached hereto as Exhibit G is a true, complete and
correct list of each of the Pole Agreements of the Borrower with all amendments
thereto, each of which is in full force and effect on the date hereof.
General Communication, Inc. - Form 8-K
Page 350
(8) Attached hereto as Exhibit H is a true, complete and
correct copy of the Management Agreement.
(9) The Borrower has from the dates of the certificates
referred to in item (2) above through the date hereof remained in good standing
under the laws of such states in which it is qualified to do business.
(10) No suit or proceeding for the dissolution or liquidation
of the Borrower has been instituted or is now threatened.
(11) To the best of the Borrower's knowledge, there are no
actions, suits or proceedings pending or threatened against the Borrower or its
property before any court, arbitrator or governmental department, commission,
board, bureau, agency or other instrumentality, domestic or foreign, other than
any such actions, suits or proceedings described on Schedule 9 to the Loan
Agreement, and no such action, suit or proceeding, if determined adversely to
the Borrower, would be likely to have a Materially Adverse Effect.
(12) The following persons have been duly elected to the
offices set forth beside their names, have been duly qualified, and on the date
hereof are officers of the Borrower, holding the offices set forth opposite
their respective names below, and the signatures set forth opposite their
respective names are their respective genuine signatures:
Name Title Signature
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
IN WITNESS WHEREOF, I have signed this Loan Certificate of the Borrower
as of the 31st day of October, 1996.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
General Communication, Inc. - Form 8-K
Page 351
EXHIBITS
Exhibit A - Articles of Incorporation
Exhibit B - Certificate of Good Standing
Exhibit C - Bylaws
Exhibit D - Corporate Resolutions
Exhibit E - Shareholders' Similar Agreements
Exhibit F - Licenses
Exhibit G - List of Pole Agreements
Exhibit H - Management Agreement
General Communication, Inc. - Form 8-K
Page 352
LOAN CERTIFICATE
PARENT COMPANY
I, John M. Lowber, do hereby certify that I am the duly elected and
qualified Senior Vice President/Secretary and keeper of the corporate records
and corporate seal of General Communication, Inc., a corporation organized and
existing under the laws of the State of Alaska (the "Parent"), which owns all of
the issued and outstanding stock of GCI Cable, Inc. (the "Borrower"). In
connection with that certain Loan Agreement dated October 31, 1996 (the "Loan
Agreement") among the Borrower, the Banks (as defined therein) (the "Banks"),
Toronto Dominion (Texas), Inc., NationsBank of Texas, N.A., The Chase Manhattan
Bank, N.A. and Credit Lyonnais, New York Branch, as managing agents
(collectively the "Managing Agents"), and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent"), I hereby certify to the Administrative Agent, the Managing Agents and
the Banks that:
(1) Attached hereto as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Parent certified by the
Alaska Department of Commerce and Economic Development.
(2) Attached hereto as Exhibit B are certificates of good
standing issued by the Secretary of State or similar state official for each
state in which Parent is incorporated or required to qualify to do business;
(3) Attached hereto as Exhibit C is a true, complete and
correct copy of the Bylaws of the Parent;
(4) Attached hereto as Exhibit D is a true, complete and
correct copy of the corporate resolutions of the Parent adopted by the Parent's
Board of Directors on October 10, 1996, such corporate action having been duly
taken in accordance with the provisions of Applicable Law, the Articles of
Incorporation and the Bylaws, and such resolutions are now in full force and
effect, without any modifications in any respect. Such resolutions authorize the
Parent to execute, deliver and perform the Loan Documents to which it is a
party;
(5) Attached hereto as Exhibit E is a true, complete and
correct copy of all shareholders' or other similar agreements or voting trust
agreements in effect with respect to the stock interest of the Parent;
(6) The Parent has from the dates of the certificates
referred to in item (2) above through the date hereof remained in good standing
under the laws of the states in which it is qualified to do business.
(7) No suit or proceeding for the dissolution or liquidation
of the Parent has been instituted or is now threatened.
General Communication, Inc. - Form 8-K
Page 353
(8) The following persons have been duly elected to the
offices set forth beside their names, have been duly qualified, and on the date
hereof are officers of the Parent, holding the offices set forth opposite their
respective names below, and the signatures set forth opposite their respective
names are their respective genuine signatures:
Name Title Signature
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
IN WITNESS WHEREOF, I have signed this Loan Certificate of the Parent
as of the 31st day of October, 1996.
GENERAL COMMUNICATION, INC.
By: /s/ John M. Lowber
Its: Senior Vice President
EXHIBITS
Exhibit A - Articles of Incorporation
Exhibit B - Certificates of Good Standing
Exhibit C - Bylaws
Exhibit D - Corporate Resolutions
Exhibit E - Shareholder's and Other Agreements
General Communication, Inc. - Form 8-K
Page 354
LOAN CERTIFICATE
GCI CABLE/FAIRBANKS, INC.
I, John M. Lowber, do hereby certify that I am the duly elected and
qualified Secretary/Treasurer and keeper of the corporate records and corporate
seal of GCI Cable/Fairbanks, Inc., a corporation organized and existing under
the laws of the State of Alaska (the "Subsidiary"), which is a wholly-owned
subsidiary of the GCI Cable, Inc. (the "Borrower"). In connection with that
certain Loan Agreement dated October 31, 1996 (the "Loan Agreement") among the
Borrower, the Banks (as defined therein) (the "Banks"), Toronto Dominion
(Texas), Inc., NationsBank of Texas, N.A., The Chase Manhattan Bank, N.A. and
Credit Lyonnais, New York Branch, as managing agents (collectively the "Managing
Agents"), and Toronto Dominion (Texas), Inc., as administrative agent for the
Managing Agents and the Banks (the "Administrative Agent"), I hereby certify to
the Administrative Agent, the Managing Agents and the Banks that:
(1) Attached hereto as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Subsidiary certified by the
Alaska Department of Commerce and Economic Development.
(2) Attached hereto as Exhibit B are certificates of good
standing issued by the Secretary of State or similar state official for each
state in which Subsidiary is incorporated or required to qualify to do business;
(3) Attached hereto as Exhibit C is a true, complete and
correct copy of the Bylaws of the Subsidiary;
(4) Attached hereto as Exhibit D is a true, complete and
correct copy of the corporate resolutions of the Subsidiary adopted by the
Subsidiary's Board of Directors on October 10, 1996, such corporate action
having been duly taken in accordance with the provisions of Applicable Law, the
Articles of Incorporation and the Bylaws, and such resolutions are now in full
force and effect, without any modifications in any respect. Such resolutions
authorize the Subsidiary to execute, deliver and perform the Loan Documents to
which it is a party;
(5) Attached hereto as Exhibit E is a true, complete and
correct copy of all shareholders' or other similar agreements or voting trust
agreements in effect with respect to the stock interest of the Subsidiary;
(6) Attached hereto as Exhibit F is a true, complete and
correct photocopy of the Licenses of the Subsidiary, together with all
amendments thereto, each of which is in full force and effect on the date
hereof.
(7) Attached hereto as Exhibit G is a true, complete and
correct list of each of the Pole Agreements of the Subsidiary with all
amendments thereto, each of which is in full force and effect on the date
hereof.
General Communication, Inc. - Form 8-K
Page 355
(8) The Subsidiary has from the dates of the certificates
referred to in item (2) above through the date hereof remained in good standing
under the laws of the states in which it is qualified to do business.
(9) No suit or proceeding for the dissolution or liquidation
of the Subsidiary has been instituted or is now threatened.
(10) To the best of the Subsidiary's knowledge, there are no
actions, suits or proceedings pending or threatened against the Subsidiary or
any of its respective property before any court, arbitrator or governmental
department, commission, board, bureau, agency or other instrumentality, domestic
or foreign, other than any such actions, suits or proceedings described on
Schedule 9 to the Loan Agreement, and no such action, suit or proceeding, if
determined adversely to the Subsidiary, would be likely to have a Materially
Adverse Effect.
(11) The following persons have been duly elected to the
offices set forth beside their names, have been duly qualified, and on the date
hereof are officers of the Subsidiary, holding the offices set forth opposite
their respective names below, and the signatures set forth opposite their
respective names are their respective genuine signatures:
Name Title Signature
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
IN WITNESS WHEREOF, I have signed this Loan Certificate of the
Subsidiary as of the 31st day of October, 1996.
GCI CABLE/FAIRBANKS, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
General Communication, Inc. - Form 8-K
Page 356
EXHIBITS
Exhibit A - Articles of Incorporation
Exhibit B - Certificates of Good Standing
Exhibit C - Bylaws
Exhibit D - Corporate Resolutions
Exhibit E - Shareholder's and Other Agreements
Exhibit F - Licenses
Exhibit G - List of Pole Agreements
General Communication, Inc. - Form 8-K
Page 357
LOAN CERTIFICATE
GCI CABLE/JUNEAU, INC.
I, John M. Lowber, do hereby certify that I am the duly elected and
qualified Secretary/Treasurer and keeper of the corporate records and corporate
seal of GCI Cable/Juneau, Inc., a corporation organized and existing under the
laws of the State of Alaska (the "Subsidiary"), which is a wholly-owned
subsidiary of the GCI Cable, Inc. (the "Borrower"). In connection with that
certain Loan Agreement dated October 31, 1996 (the "Loan Agreement") among the
Borrower, the Banks (as defined therein) (the "Banks"), Toronto Dominion
(Texas), Inc., NationsBank of Texas, N.A., The Chase Manhattan Bank, N.A. and
Credit Lyonnais, New York Branch, as managing agents (collectively the "Managing
Agents"), and Toronto Dominion (Texas), Inc., as administrative agent for the
Managing Agents and the Banks (the "Administrative Agent"), I hereby certify to
the Administrative Agent, the Managing Agents and the Banks that:
(1) Attached hereto as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Subsidiary certified by the
Alaska Department of Commerce and Economic Development.
(2) Attached hereto as Exhibit B are certificates of good
standing issued by the Secretary of State or similar state official for each
state in which Subsidiary is incorporated or required to qualify to do business;
(3) Attached hereto as Exhibit C is a true, complete and
correct copy of the Bylaws of the Subsidiary;
(4) Attached hereto as Exhibit D is a true, complete and
correct copy of the corporate resolutions of the Subsidiary adopted by the
Subsidiary's Board of Directors on October 10, 1996, such corporate action
having been duly taken in accordance with the provisions of Applicable Law, the
Articles of Incorporation and the Bylaws, and such resolutions are now in full
force and effect, without any modifications in any respect. Such resolutions
authorize the Subsidiary to execute, deliver and perform the Loan Documents to
which it is a party;
(5) Attached hereto as Exhibit E is a true, complete and
correct copy of all shareholders' or other similar agreements or voting trust
agreements in effect with respect to the stock interest of the Subsidiary;
(6) Attached hereto as Exhibit F is a true, complete and
correct photocopy of the Licenses of the Subsidiary, together with all
amendments thereto, each of which is in full force and effect on the date
hereof.
(7) Attached hereto as Exhibit G is a true, complete and
correct list of each of the Pole Agreements of the Subsidiary with all
amendments thereto, each of which is in full force and effect on the date
hereof.
General Communication, Inc. - Form 8-K
Page 358
(8) The Subsidiary has from the dates of the certificates
referred to in item (2) above through the date hereof remained in good standing
under the laws of the states in which it is qualified to do business.
(9) No suit or proceeding for the dissolution or liquidation
of the Subsidiary has been instituted or is now threatened.
(10) To the best of the Subsidiary's knowledge, there are no
actions, suits or proceedings pending or threatened against the Subsidiary or
any of its respective property before any court, arbitrator or governmental
department, commission, board, bureau, agency or other instrumentality, domestic
or foreign, other than any such actions, suits or proceedings described on
Schedule 9 to the Loan Agreement, and no such action, suit or proceeding, if
determined adversely to the Subsidiary, would be likely to have a Materially
Adverse Effect.
(11) The following persons have been duly elected to the
offices set forth beside their names, have been duly qualified, and on the date
hereof are officers of the Subsidiary, holding the offices set forth opposite
their respective names below, and the signatures set forth opposite their
respective names are their respective genuine signatures:
Name Title Signature
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
IN WITNESS WHEREOF, I have signed this Loan Certificate of the
Subsidiary as of the 31st day of October, 1996.
GCI CABLE/JUNEAU, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
General Communication, Inc. - Form 8-K
Page 359
EXHIBITS
Exhibit A - Articles of Incorporation
Exhibit B - Certificates of Good Standing
Exhibit C - Bylaws
Exhibit D - Corporate Resolutions
Exhibit E - Shareholder's and Other Agreements
Exhibit F - Licenses
Exhibit G - List of Pole Agreements
General Communication, Inc. - Form 8-K
Page 360
LOAN CERTIFICATE
GCI CABLE HOLDINGS, INC.
I, John M. Lowber, do hereby certify that I am the duly elected and
qualified Secretary/Treasurer and keeper of the corporate records and corporate
seal of GCI Cable Holdings, Inc., a corporation organized and existing under the
laws of the State of Alaska (the "Subsidiary"), which is a wholly-owned
subsidiary of the GCI Cable, Inc. (the "Borrower"). In connection with that
certain Loan Agreement dated October 31, 1996 (the "Loan Agreement") among the
Borrower, the Banks (as defined therein) (the "Banks"), Toronto Dominion
(Texas), Inc., NationsBank of Texas, N.A., The Chase Manhattan Bank, N.A. and
Credit Lyonnais, New York Branch, as managing agents (collectively the "Managing
Agents"), and Toronto Dominion (Texas), Inc., as administrative agent for the
Managing Agents and the Banks (the "Administrative Agent"), I hereby certify to
the Administrative Agent, the Managing Agents and the Banks that:
(1) Attached hereto as Exhibit A is a true, complete and
correct copy of the Articles of Incorporation of the Subsidiary certified by the
Alaska Department of Commerce and Economic Development.
(2) Attached hereto as Exhibit B are certificates of good
standing issued by the Secretary of State or similar state official for each
state in which Subsidiary is incorporated or required to qualify to do business;
(3) Attached hereto as Exhibit C is a true, complete and
correct copy of the Bylaws of the Subsidiary;
(4) Attached hereto as Exhibit D is a true, complete and
correct copy of the corporate resolutions of the Subsidiary adopted by the
Subsidiary's Board of Directors on October 10, 1996, such corporate action
having been duly taken in accordance with the provisions of Applicable Law, the
Articles of Incorporation and the Bylaws, and such resolutions are now in full
force and effect, without any modifications in any respect. Such resolutions
authorize the Subsidiary to execute, deliver and perform the Loan Documents to
which it is a party;
(5) Attached hereto as Exhibit E is a true, complete and
correct copy of all shareholders' or other similar agreements or voting trust
agreements in effect with respect to the stock interest of the Subsidiary;
(6) Attached hereto as Exhibit F is a true, complete and
correct photocopy of the Licenses of the Subsidiary, together with all
amendments thereto, each of which is in full force and effect on the date
hereof.
(7) Attached hereto as Exhibit G is a true, complete and
correct list of each of the Pole Agreements of the Subsidiary with all
amendments thereto, each of which is in full force and effect on the date
hereof.
General Communication, Inc. - Form 8-K
Page 361
(8) The Subsidiary has from the dates of the certificates
referred to in item (2) above through the date hereof remained in good standing
under the laws of the states in which it is qualified to do business.
(9) No suit or proceeding for the dissolution or liquidation
of the Subsidiary has been instituted or is now threatened.
(10) To the best of the Subsidiary's knowledge, there are no
actions, suits or proceedings pending or threatened against the Subsidiary or
any of its respective property before any court, arbitrator or governmental
department, commission, board, bureau, agency or other instrumentality, domestic
or foreign, other than any such actions, suits or proceedings described on
Schedule 9 to the Loan Agreement, and no such action, suit or proceeding, if
determined adversely to the Subsidiary, would be likely to have a Materially
Adverse Effect.
(11) The following persons have been duly elected to the
offices set forth beside their names, have been duly qualified, and on the date
hereof are officers of the Subsidiary, holding the offices set forth opposite
their respective names below, and the signatures set forth opposite their
respective names are their respective genuine signatures:
Name Title Signature
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
IN WITNESS WHEREOF, I have signed this Loan Certificate of the
Subsidiary as of the 31st day of October, 1996.
GCI CABLE HOLDINGS, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
General Communication, Inc. - Form 8-K
Page 362
EXHIBITS
Exhibit A - Articles of Incorporation
Exhibit B - Certificates of Good Standing
Exhibit C - Bylaws
Exhibit D - Corporate Resolutions
Exhibit E - Shareholder's and Other Agreements
Exhibit F - Licenses
Exhibit G - List of Pole Agreements
General Communication, Inc. - Form 8-K
Page 363
LOAN CERTIFICATE
LIMITED PARTNERSHIP SUBSIDIARY
I, John M. Lowber, do hereby certify that I am the duly elected and
qualified Secretary/Treasurer and keeper of the corporate records and corporate
seal of GCI Cable, Inc., a corporation organized and existing under the laws of
the State of Alaska (referred to herein as the "General Partner" or "Borrower"),
which is the sole general partner of Prime Cable of Alaska, L.P., a Delaware
limited partnership and a subsidiary of the Borrower (the "Subsidiary"). In
connection with that certain Loan Agreement dated October 31, 1996 (the "Loan
Agreement") among the Borrower, the Banks (as defined therein) (the "Banks"),
Toronto Dominion (Texas), Inc., NationsBank of Texas, N.A., The Chase Manhattan
Bank, N.A. and Credit Lyonnais, Cayman Island Branch, as managing agents
(collectively the "Managing Agents"), and Toronto Dominion (Texas), Inc., as
administrative agent for the Managing Agents and the Banks (the "Administrative
Agent"), I hereby certify to the Administrative Agent, the Managing Agents and
the Banks that:
(1) Attached hereto as Exhibit A is a true, complete and
correct copy of the Partnership Agreement of the Subsidiary, and a true,
complete and correct copy of the Certificate of Limited Partnership of the
Subsidiary certified by the Delaware Secretary of State.
(2) Attached hereto as Exhibit B are certificates of good
standing issued by the Secretary of State or similar state official for each
state in which Subsidiary and its General Partner is incorporated or required to
qualify to do business;
(3) Attached hereto as Exhibit C is a true, correct and
complete copy of corporate resolutions of the General Partner adopted by the
General Partner's Board of Directors on October 10, 1996, such corporate action
having been duly taken in accordance with the provisions of Applicable Law, the
Articles of Incorporation and the Bylaws of the General Partner, and such
resolutions are now in full force and effect, without any modifications in any
respect. Such resolutions authorize the General Partner to act on behalf of the
Borrower and the officers designated therein to execute, deliver, and perform
the Loan Documents to which the Subsidiary is a party.
(4) Attached hereto as Exhibit D is a true, complete and
correct copy of all partners' and other similar agreements or voting trust
agreements in effect with respect to the partnership interests of the
Subsidiary;
(5) Attached hereto as Exhibit E is a true, complete and
correct photocopy of the Licenses of the Subsidiary, together with all
amendments thereto, each of which is in full force and effect on the date
hereof.
(6) Attached hereto as Exhibit F is a true, complete and
correct list of each of the Pole Agreements of the Subsidiary with all
amendments thereto, each of which is in full force and effect on the date
hereof.
General Communication, Inc. - Form 8-K
Page 364
(7) The Subsidiary and the General Partner have from the
dates of the certificates referred to in item (2) above through the date hereof
remained in good standing under the laws of the states in which they are
qualified to do business.
(8) No suit or proceeding for the dissolution or liquidation
of the General Partner or the Subsidiary has been instituted or is now
threatened.
(9) To the best of the General Partner's knowledge, there are
no actions, suits or proceedings pending or threatened against the General
Partner or the Subsidiary or any of their respective property before any court,
arbitrator or governmental department, commission, board, bureau, agency or
other instrumentality, domestic or foreign, other than any such actions, suits
or proceedings described on Schedule 9 to the Loan Agreement, and no such
action, suit or proceeding, if determined adversely to the General Partner or
the Subsidiary, would be likely to have a Materially Adverse Effect.
(10) The following persons have been duly elected to the
offices set forth beside their names, have been duly qualified, and on the date
hereof are officers of the General Partner, holding the offices set forth
opposite their respective names below, and the signatures set forth opposite
their respective names are their respective genuine signatures:
Name Title Signature
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
- ---------------------- ------------------------- -------------------
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
IN WITNESS WHEREOF, I have signed this Loan Certificate of the
Subsidiary as of the 31st day of October, 1996.
GCI CABLE, INC.
By: /s/ John M. Lowber
Its: Secretary/Treasurer
General Communication, Inc. - Form 8-K
Page 365
EXHIBITS
Exhibit A - Partnership Agreement and Certificate of
Limited Partnership
Exhibit B - Certificates of Good Standing
Exhibit C - Corporate Resolutions
Exhibit D - Partners' and Other Agreements
Exhibit E - Licenses
Exhibit F - List of Pole Agreements
General Communication, Inc. - Form 8-K
Page 365
EXHIBIT N-1
[HARTIG, RHODES, NORMAN, MAHONEY & EDWARDS LETTERHEAD]
October 31, 1996
Anchorage
Toronto Dominion (Texas), Inc. The Chase Manhattan Bank N.A.
909 Fannin, Suite 1700 One Chase Manhattan Plaza
Houston, Texas 77010 4th Floor
New York, New York 10081
NationsBank of Texas, N.A. The Bank of New York
901 Main Street, 64th Floor One Wall Street
Dallas, Texas 75202 16th Floor
New York, New York 10286
Credit Lyonnais New York Branch Banque Paribas
1301 Avenue of the Americas 2029 Century Park East
New York, New York 10019 Suite 3900
Los Angeles, California 90067
PNC Bank, National Association The First National Bank of Maryland
100 South Broad Street 25 South Charles Street
Philadelphia, Pennsylvania 19101 18th Floor
Baltimore, Maryland 21201
Ladies and Gentlemen:
We have acted as counsel for General Communication, Inc. ("Parent
Company"), GCI Cable, Inc. ("Borrower"), GCI Cable/Fairbanks, Inc., GCI
Cable/Juneau, Inc., and GCI Cable Holdings, Inc. ("Guarantors") Alaska
corporations, and Prime Cable of Alaska, L.P., a Delaware limited partnership
("Prime Guarantor") in connection with that certain Loan Agreement dated as of
October 31, 1996 ("Loan Agreement") by and among Toronto Dominion (Texas), Inc.
("TD Bank"), NationsBank of Texas, N.A. ("NationsBank"), Credit Lyonnais New
York Branch ("Credit Lyonnais"), The Chase Manhattan Bank N.A. ("Chase"), The
Bank of New York, Banque Paribas, PNC Bank, National Association and The First
National Bank of Maryland, as
General Communication, Inc. - Form 8-K
Page 367
October 31, 1996
Page
lenders (collectively, "Banks"), TD Bank, NationsBank, Credit Lyonnais and Chase
acting as managing agents for the Banks (together, "Managing Agents"), and TD
Bank, as administrative agent for the Managing Agents and the Banks ("Agent"),
and the Borrower. This opinion letter is being delivered to you in accordance
with Section 3.1(a)(xi) of the Loan Agreement. Capitalized terms used in this
opinion letter without definition have the same meanings as in the Loan
Agreement.
1. Documents/Matters Reviewed
As counsel for the Parent Company, Borrower, Guarantors, and Prime
Guarantor, we have reviewed the documents listed on Schedule 1 hereto (items 1
through 19 thereof are referred to herein, collectively, as "Agreement
Documents"), the certificates of public officials and such corporate or
partnership certificates and documents of the Parent Company, Borrower,
Guarantors and Prime Guarantor as are necessary to render this opinion. In all
such examinations, we have assumed the authenticity of all signatures, the
authenticity and completeness of all documents submitted to us as originals, and
the conformity to originals and the completeness of all documents submitted to
us as photostatic, notarial or certified copies.
2. Opinions
Based on the foregoing, and subject to the assumptions, limitations,
qualifications and exceptions set forth in Sections 1, 2 and 3 of this opinion
letter, we are of the opinion that:
2.1 The Parent Company, Borrower and Guarantors are
corporations duly organized, validly existing and in good standing under the
laws of the State of Alaska. The Borrower and Guarantors have all requisite
corporate power and authority to own or lease and operate their properties, to
conduct their business as now being conducted, and to execute, deliver and
perform all of their obligations under each of the Agreement Documents to which
each is a party.
2.2 The execution, delivery and performance by Parent Company,
Borrower, Guarantors and Prime Guarantor of each of the Agreement Documents to
which it is a party, have been duly and validly authorized by all necessary
partnership or corporate, as the case may be, action on the part of each entity.
2.3 Each of the Agreement Documents constitutes the legal,
valid and binding obligation of such of the Parent Company, Borrower, Guarantors
and Prime Guarantor as are party thereto, enforceable against them,
respectively, in accordance with their respective terms.
General Communication, Inc. - Form 8-K
Page 368
October 31, 1996
Page
2.4 The execution, delivery and performance by the Parent
Company, Borrower, and Guarantors of the Agreement Documents to which each is a
party do not (i) violate any material law, rule or regulation which, in our
experience, is normally applicable to transactions of the type contemplated by
the provisions of the Agreement Documents to which the Borrower is a party, (ii)
violate the articles of incorporation or bylaws of the Parent Company, Borrower
or Guarantors, (iii) breach in any material respect, or result in a material
default under, any existing obligation of the Parent Company, Borrower, and
Guarantors under any indenture or loan or credit agreement or any other material
agreement, lease or instrument of which we are aware to which the Parent
Company, Borrower, and Guarantors are a party or by which the Parent Company,
Borrower, and Guarantors are bound, (iv) breach in any material respect or
otherwise violate in any material respect any existing obligation of the Parent
Company, Borrower, and Guarantors under any material order, writ, judgment,
injunction, decree, determination or award of any court, arbitrator or
government, commission, board, bureau, agency or other instrumentality binding
upon the Parent Company, Borrower, and Guarantors of which we are aware, or (v)
to our knowledge, result in the creation or imposition of any Lien (other than
Permitted Liens) against or upon the Borrower's or Guarantor's assets.
2.5 To our knowledge, there are no actions or proceedings
against Parent Company, Borrower, or Guarantors pending or overtly threatened in
writing (other than such matters affecting the cable television industries in
the State of Alaska or in the United States generally), before any court,
governmental agency or arbiter which, if determined adversely as to any of such
entities, could have a materially adverse effect upon any such entity.
2.6 Borrower has duly executed (or, in the case of those
documents as to which Borrower is not nominally a party, duly acknowledged) and
delivered to the Agent, the Loan Documents to which Borrower is a party.
2.7 To our knowledge, no material authorization, consent,
approval, license, exemption of or filing or registration with any court or
governmental department, commission, board, bureau, agency or other
instrumentality, domestic or foreign, is or will be necessary or appropriate to
the valid execution, delivery or performance by Borrower of the Loan Documents
to which it is a party as the case may be, or for the payment to the Agent and
the Banks of any sums under the Agreement Documents, except for (i) consents
previously obtained, and (ii) consents the absence of which would not adversely
affect the Agent's and the Banks' rights or security under the Agreement
Documents.
General Communication, Inc. - Form 8-K
Page 369
October 31, 1996
Page
2.8 The Security Agreement and the Subsidiary Security
Agreements create a valid Security Interest in the Collateral in favor of the
Banks and the Agent; and assuming that appropriate UCC financing statements and
amendments and continuation statements thereof have been duly filed with the UCC
Central Filing Office in Anchorage, Alaska, the Security Interest created in the
Collateral under the Security Agreement and the Subsidiary Security Agreements
is perfected to the extent that a security interest in such Collateral can be
perfected by filing a financing statement under the provisions of the Code as
currently in effect in the State of Alaska.
2.9 The Assignment of Partnership Interests creates a valid
security interest in the interests in the Prime Guarantor owned by Borrower and
Cable Holdings, Inc., to the extent such a security interest can be created
therein by executing a security agreement under the UCC. Pursuant to Alaska
Statute, AS 45.09.103(c) of the UCC as adopted in Alaska, the law of the
jurisdiction in which the debtor is located governs the perfection and the
effect of perfection or non-perfection of a security interest in intangible
property.
3. Assumptions, Limitations, Qualifications and
Exceptions
The opinions expressed above are subject to and qualified in all
respects by the following:
3.1 In rendering the opinions expressed in Section 2 above, we
have relied solely upon (i) the factual matters stated in the certificates of
public officials, (ii) the certifications made to us as of this date by officers
of the Parent Company, Borrower, Guarantors and Prime Guarantor, (iii)
representations, warranties, certifications and statements of the Parent
Company, Borrower, Guarantors and Prime Guarantor made pursuant to the Loan
Agreement and the other Agreement Documents as to the factual matters set forth
therein, (iv) our review of counterparts of the documents referenced on Schedule
1 hereto, (v) our review of the Parent Company, Borrower, Guarantors and Prime
Guarantor's corporate or partnership documents necessary to render this opinion,
and (vi) all laws, rules and regulations which, in our experience, are normally
applicable to transactions of the type contemplated by the provisions of the
Agreement Documents, and although we have made no independent factual
investigation with regard to such matters set forth in (i)-(v) above, we have no
knowledge of any matter inconsistent with the opinions expressed in Section 2
above. The phrase "to our knowledge" or "of which we are aware," when used in
this opinion letter means the awareness of facts or other information by the
attorneys in this firm who have given substantive legal attention to
representation of the Parent Company, Borrower, Prime Guarantor, and Guarantors
in connection with the Loan Agreement. We have assumed that neither the Agent,
the Banks nor their counsel know of any reason why the opinions set forth in
this opinion letter may be incorrect.
General Communication, Inc. - Form 8-K
Page 370
October 31, 1996
Page
3.2 We have assumed that the Agreement Documents will be
administered in accordance with the terms thereof, and that there are no other
contracts or agreements (other than the other Loan Documents), written or oral,
between or among any of the Banks, the Agent, the Parent Company, Borrower,
Guarantors and Prime Guarantor or any other parties to any thereof, with respect
to the Loans.
3.3 We express no opinion regarding the accuracy, or the
effect of any breach, of any representation, warranty or certification under the
Agreement Documents to be made, remade or renewed after the date hereof with
respect to any future event, condition or occurrence. The opinions expressed by
us are limited to the matters expressly stated herein and no opinions are
implied, or should be inferred, beyond the matters expressly so stated.
3.4 To the extent our opinions herein may be affected by such
matters, we have assumed for purposes hereof, (i) that each party to the
Agreement Documents (other than the Parent Company, Borrower, and Guarantor) is
duly organized; (ii) that each party to the Agreement Documents (other than the
Parent Company, Borrower, and Guarantor) is validly existing and in good
standing under the laws of the jurisdiction of its organization and in each
other jurisdiction in which the ownership of its properties or the conduct of
its business requires such party to qualify to do business and has the power to
own, lease and operate its properties therein and to conduct its business
therein as now conducted; (iii) that (except as to the Parent Company, Borrower,
Guarantors, and Prime Guarantor) the Agreement Documents have been duly
authorized; (iv) that (other than the Parent Company, Borrower, Guarantors, and
Prime Guarantor) the Agreement Documents have been properly executed and
delivered by all parties thereto; (v) that the Agreement Documents constitute
the legal, valid and binding obligations of the parties thereto (other than the
Parent Company, Borrower, and Guarantor, enforceable against them in accordance
with their respective terms; (vi) that each such party (other than the Parent
Company, Borrower, and Guarantor) has the requisite corporate or other
organizational power and authority to execute and deliver the Agreement
Documents and perform its obligations thereunder, as applicable; and (vii) that
the execution, delivery and performance by each party (other than the Parent
Company, Borrower, Guarantors and Prime Guarantor) to the Agreement Documents
does not and will not violate any statutes, laws, ordinances, regulations,
rules, orders, writs, injunctions or decrees or any court or governmental
authority of any jurisdiction applicable to each such party or its assets.
3.5 We express no opinions as to any matters involving (i)
choices or conflicts of laws, or (ii) applicable usury laws. We have assumed,
without inquiry, with respect to all of the Agreement Documents that the
internal laws, and not the law of conflicts, of the State of New York apply and
that the internal laws of the State of New York are the same as the internal
laws of the State of Alaska.
General Communication, Inc. - Form 8-K
Page 371
October 31, 1996
Page
3.6 With your approval, we express no opinion (i) as to the
creation or perfection of security interests in any assets or properties of any
Person, except to the limited extent set forth in Paragraphs 2.8 and 2.9 above,
or (ii) with respect to matters governed by the law of the State of New York.
3.7 We are qualified to practice law in the State of Alaska
only and we have made no investigation of and express no opinion with respect to
the laws of any other state or jurisdiction, other than applicable federal laws
(except as noted below). Furthermore, we express no opinion with respect to (i)
matters governed by the Federal Communications Act of 1934, as amended, and the
rules and regulations of the Federal Communications Commission thereunder, (ii)
copyright matters under Title 17 of the United States Code, and the rules and
regulations of the United States Copyright Office thereunder, (iii) matters
governed by the Federal Aviation Act of 1958, as amended, and the rules and
regulations of the Federal Aviation Administration thereunder, (iv) land use,
environmental or ecological laws, statutes or regulations, (v) ordinances of
municipalities, and similar political subdivisions of the State of Alaska, or
(vi) matters governed by the Alaska Public Utilities Commission Act.
3.8 The opinions stated in Paragraph 2.3 above are subject to,
and shall be interpreted in accordance with, the Bankruptcy and Insolvency
Exceptions, Equitable Principals Limitation and Other Common Qualifications set
forth on Schedules 2, 3, and 4 hereto.
3.9 With regard to the opinions expressed concerning the
enforceability of the Agreement Documents, such enforceability may be limited by
the rights of the United States under the Federal Tax Lien Act of 1966, as
amended, and by requirements of due process under the United States
Constitution, the Constitution of the State of Alaska and other laws or court
decisions limiting the rights of creditors to repossess, foreclose or otherwise
realize upon the property of a debtor without appropriate notice or hearing or
both. We express no opinion as to whether a court would grant specific
performance or any other equitable remedy with respect to the enforcement of the
Agreement Documents. Further, we express no opinion as to the enforceability of
(i) non-judicial foreclosure, receivership and self-help remedies provided for
in the Agreement Documents; (ii) provisions which purport to restrict access to
legal or equitable remedies or which purport to establish penalties or
evidentiary standards; (iii) provisions relating to subrogation rights,
suretyship, delay or omission of enforcement of remedies and indemnity; (iv)
provisions which purport to appoint the Agent or the Banks, in any capacity, as
the attorney-in-fact or proxy of any of the Parent Company, Borrower, Guarantors
and Prime Guarantor; (v) provisions which purport to waive rights or notices;
(vi) provisions relating to consent judgments, waivers of defenses or the
benefits of statutes of limitations, marshaling of assets, the transferability
of any assets which by their nature are nontransferable, sales in inverse order
of alienation, or severance; (vii) provisions which purport to prohibit or
restrict transfer of title to,
General Communication, Inc. - Form 8-K
Page 372
October 31, 1996
Page
or the granting of junior encumbrances of, all or any part of the property
covered by any of the Agreement Documents; or (viii) so-called "dragnet,"
"Mother Hubbard" or "future advance" clauses, as said provisions relate to loans
other than the loans evidenced by the Notes.
3.10 The enforceability of certain of the remedial, waiver,
subrogation, indemnity and other provisions of the Agreement Documents is
further subject to all applicable constitutional, legislative, judicial and
administrative provisions, statutes, decisions, rulings and other laws, in
addition to those described in Paragraph 3.9 above; however, such laws do not,
in our opinion, substantially interfere with the practical realization of the
benefits expressed in the Agreement Documents (except for the economic
consequences of any procedural delay which may result from such laws).
This opinion is given solely to the Banks, the Agent and their counsel
and shall not be relied upon by any other person or entity other than the Banks,
the Agent, their counsel, examiners and auditors. This opinion may not be
quoted, circulated or published, in whole or in part, or furnished or relied
upon by any other party, without our prior written consent, except as may be
required by process of law or in connection with litigation arising out of the
Agreement Documents, and, except that this opinion letter may be disclosed to
the bank regulatory authorities and may be relied upon by assignees of the Banks
under Section 11.6 of the Loan Agreement. The opinions herein are expressed as
of the date hereof only and not as of some future date. We undertake no
responsibility to update this opinion for events occurring after the date
hereof.
Sincerely,
HARTIG, RHODES, NORMAN,
MAHONEY & EDWARDS, P.C.
By: /s/
Robert B. Flint
RBF/jmh
Enclosures
cc:
A:\Toronto docs\Opinion.RBF
General Communication, Inc. - Form 8-K
Page 373
October 31, 1996
Page
SCHEDULE 1
Documents Examined
Terms used herein and defined in the Loan Agreement are used herein as therein
defined. Reference to each document includes reference to all exhibits and
exhibits thereto.
1. Loan Agreement.
2. $31,250,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to Toronto Dominion (Texas), Inc.
3. $31,250,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to NationsBank of Texas, N.A.
4. $31,250,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to Credit Lyonnais New York Branch.
5. $31,250,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to The Chase Manhattan Bank N.A.
6. $25,000,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to The Bank of New York.
7. $25,000,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to Banque Paribas.
8. $15,000,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to PNC Bank, National Association.
9. $15,000,000 Promissory Note dated October 31, 1996 executed by the
Borrower and payable to The First National Bank of Maryland.
10. Security Agreement.
11. Subsidiary Guaranty.
12. Security Agreement.
General Communication, Inc. - Form 8-K
Page 374
October 31, 1996
Page
13. Fee Letters.
14. Assignment of Partnership Interests.
15. Parent's Pledge Agreement.
16. Borrower's Pledge Agreement.
17. Mortgage
18. Subordination and Assignment of Management Agreement
19. Subordination Agreement
20. Borrower's Loan Certificate.
21. Request for Initial Advance.
22. Use of Proceeds Letter.
General Communication, Inc. - Form 8-K
Page 375
October 31, 1996
Page
SCHEDULE 2
Bankruptcy and Insolvency Exceptions
Paragraph 2.4 of this opinion letter is subject to the effect of
bankruptcy, insolvency, reorganization, receivership, moratorium and other
similar laws affecting the rights and remedies of creditors generally. This
exception includes;
(a) the Federal Bankruptcy Code and thus comprehends, among
others, matters of turn-over, automatic stay, avoiding powers,
fraudulent transfer, preference, discharge, conversion of a
non-recourse obligation into a recourse claim, limitations on
ipso facto and anti-assignment clauses and the coverage of
pre-petition security agreements applicable to property
acquired after a petition is filed;
(b) all other Federal and state bankruptcy, insolvency,
reorganization, receivership, moratorium, arrangement and
assignment for the benefit of creditors laws that affect the
rights and remedies of creditors generally (not just creditors
of specific types of debtors);
(c) all other Federal bankruptcy, insolvency, reorganization,
receivership, moratorium, arrangement and assignment for the
benefit of creditors laws that have reference to or affect
generally only creditors of specific types of debtors and
state laws of like character affecting generally only
creditors of financial institutions and insurance companies;
(d) state fraudulent transfer and conveyance laws; and
(e) judicially developed doctrines relevant to any of the
foregoing laws, such as substantive consolidation of entities.
General Communication, Inc. - Form 8-K
Page 376
October 31, 1996
Page
SCHEDULE 3
Equitable Principles Limitation
Paragraph 2.3 of this opinion letter is subject to the effect of
general principles of equity, whether applied by a court of law or equity. This
limitation includes principles:
(a) governing the availability of specific performance, injunctive
relief or other equitable remedies, which generally place the
award of such remedies, subject to certain guidelines, in the
discretion of the court to which application for such relief
is made;
(b) affording equitable defenses (e.g., waiver, laches and
estoppel) against a party seeking enforcement;
(c) requiring good faith and fair dealing in the performance and
enforcement of a contract by the party seeking its
enforcement;
(d) requiring reasonableness in the performance and enforcement of
an agreement by the party seeking enforcement of the contract;
(e) requiring consideration of the materiality of (i) a party's
breach and (ii) the consequences of the breach to the party
seeking enforcement;
(f) requiring consideration of the impracticability or
impossibility of performance at the time of attempted
enforcement; and
(g) affording defenses based upon the unconscionability of the
enforcing party's conduct after the parties have entered into
the contract.
General Communication, Inc. - Form 8-K
Page 377
October 31, 1996
Page
SCHEDULE 4
Other Common Qualifications
Paragraph 2.4 of this opinion letter is subject to the effect of
generally applicable rules of Alaska Law, if any, that:
(a) limit or affect the enforcement of provisions of a contract
that purport to require waiver of the obligations of good
faith, fair dealing, diligence and reasonableness;
(b) provide that forum selection clauses in contracts are not
necessarily binding on the court(s) in the forum selected;
(c) limit the availability of a remedy under certain circumstances
where another remedy has been elected;
(d) limit the right of a creditor to use force or cause a breach
of the peace in enforcing rights;
(e) relate to the sale or disposition of collateral or the
requirements of a commercially reasonable sale;
(f) limit the enforceability of provisions releasing, exculpating
or exempting a party from, or requiring indemnification of a
party for, liability for its own action or inaction, to the
extent the action or inaction involves gross negligence,
recklessness, willful misconduct or unlawful conduct;
(g) may, where less than all of a contract may be unenforceable,
limit the enforceability of the balance of the contract to
circumstances in which the unenforceable portion is not an
essential part of the agreed exchange;
(h) govern and afford judicial discretion regarding the
determination of damages and entitlement to attorneys' fees
and other costs;
(i) may, in the absence of a waiver or consent, discharge a
guarantor to the extent that (i) action by a creditor impairs
the value of collateral securing guaranteed debt to the
detriment of the guarantor, or (ii) guaranteed debt is
materially modified; and
General Communication, Inc. - Form 8-K
Page 378
October 31, 1996
Page
(j) may permit a party who has materially failed to render or
offer performance required by the contract to cure that
failure unless (i) permitting a cure would unreasonably hinder
the aggrieved party from making substitute arrangements for
performance, or (ii) it was important in the circumstances to
the aggrieved party that performance occur by the date stated
in the contract.
General Communication, Inc. - Form 8-K
Page 379
EXHIBIT N-2
[EDENS SNODGRASS NICHOLS & BREELAND, P.C. LETTERHEAD]
October 31, 1996
Toronto Dominion (Texas), Inc. The Chase Manhattan Bank, N.A.
909 Fannin, Suite 1700 One Chase Manhattan Plaza
Houston, Texas 77010 4th Floor
New York, New York 10081
NationsBank of Texas, N.A. The Bank of New York
901 Main Street, 64th Floor One Wall Street
Dallas, Texas 75202 16th Floor
New York, New York 10286
Credit Lyonnais New York Branch Banque Paribas
1301 Avenue of the Americas 2029 Century Park East
New York, New York 10019 Suite 3900
Los Angeles, California 90067
PNC Bank, National Association The First National Bank of Maryland
100 South Broad Street 25 South Charles Street
Philadelphia, Pennsylvania 19101 18th Floor
Baltimore, Maryland 21201
Ladies and Gentlemen:
We have acted as special counsel for Prime Cable of Alaska, L.P., a
Delaware limited partnership ("Prime Alaska"), and Prime II Management, L.P., a
Delaware limited partnership (the "Manager"), in connection with that certain
Loan Agreement dated as of October 31, 1996 (the "Loan Agreement") by and among
Toronto Dominion (Texas), Inc. ("TD Bank"), NationsBank of Texas, N.A.
("NationsBank"), Credit Lyonnais New York Branch ("Credit Lyonnais"), The Chase
Manhattan Bank N.A. ("Chase"), The Bank of New York, Banque Paribas, PNC Bank,
National Association and The First National Bank of Maryland, as lenders
(collectively, the "Banks"), TD Bank, NationsBank, Credit Lyonnais and Chase
acting as managing agents for the Banks (together, the "Managing Agents"), and
TD Bank, as administrative agent for the Managing Agents and the Banks (the
"Agent"), and GCI Cable, Inc., an Alaska corporation (the "Borrower"), as
borrower. This opinion letter is being delivered to you in accordance with
Section 3.1(a)(xi) of the Loan Agreement. Capitalized terms used in this opinion
letter without definition have the same meanings as in the Loan Agreement.
General Communication, Inc. - Form 8-K
Page 380
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
1. Documents/Matters Reviewed
As special counsel for Prime Alaska and the Manager, we have reviewed
the Constituent Documents (as defined in Paragraph 2.6 below) of Prime Alaska
and the Manager, the documents listed on Schedule 1 hereto (items 2 through 5
thereof are referred to herein, collectively, as the "Prime Agreement
Documents"), and the certificates of public officials attached hereto as
Schedule 2. The description of the Prime Agreement Documents and the
definitional references to each set forth on Schedule 1 are incorporated herein.
In all such examinations, we have assumed the authenticity of all signatures
(other than signatures of representatives of the Manager), the authenticity and
completeness of all documents submitted to us as originals, and the conformity
to originals and the completeness of all documents submitted to us as
photostatic, notarial or certified copies.
2. Opinions
Based on the foregoing, and subject to the assumptions, limitations,
qualifications and exceptions set forth in Sections 1, 2 and 3 of this opinion
letter, we are of the opinion that:
2.1 The Manager and Prime Alaska are each limited partnerships
duly formed, validly existing and in good standing under the laws of the State
of Delaware. Each of Prime Alaska and the Manager has all requisite partnership
power and authority to own or lease and operate its properties, to conduct its
business as now being conducted, and to execute, deliver and perform all of
their respective obligations under each of the Prime Agreement Documents to
which it is a party.
2.2 The execution, delivery and performance by the Manager of
the Subordination and Assignment of Management Agreement has been duly and
validly authorized by all necessary partnership action on the part of the
Manager.
2.3 The Manager has duly executed and delivered to the Agent
the Subordination and Assignment of Management Agreement. The Subordination and
Assignment of Management Agreement constitutes the legal, valid and binding
obligation of the Manager, enforceable against the Manager in accordance with
its terms.
General Communication, Inc. - Form 8-K
Page 381
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
2.4 The execution, delivery and performance by Prime Alaska of
the Prime Agreement Documents to which it is a party do not (i) violate the
certificate or agreement of limited partnership, as amended, of Prime Alaska
(the "Prime Alaska Documents"), (ii) breach in any material respect, or result
in a material default under, any existing obligation of Prime Alaska under any
indenture or loan or credit agreement or any other material agreement, lease or
instrument of which we are aware to which Prime Alaska is a party or by which
Prime Alaska is bound, (iii) breach in any material respect or otherwise violate
in any material respect any existing obligation of Prime Alaska under any
material order, writ, judgment, injunction, decree, determination or award of
any court, arbitrator or government, commission, board, bureau, agency or other
instrumentality binding upon Prime Alaska of which we are aware, or (iv) to our
knowledge, result in the creation or imposition of any Lien (other than
Permitted Liens) against or upon Prime Alaska's assets.
2.5 The execution, delivery and performance by the Manager of
the Subordination and Assignment of Management Agreement, do not (i) violate any
material law, rule or regulation which, in our experience, is normally
applicable to transactions of the type contemplated by the provisions of the
Subordination and Assignment of Management Agreement, (ii) violate the
certificate or agreement of limited partnership, as amended, of the Manager (the
"Manager Documents," and collectively with the Prime Alaska Documents, the
"Constituent Documents"), (iii) breach in any material respect, or result in a
material default under, any existing obligation of the Manager under any
indenture or loan or credit agreement or any other material agreement, lease or
instrument of which we are aware to which the Manager is a party or by which the
Manager is bound, (iv) breach in any material respect or otherwise violate in
any material respect any existing obligation of the Manager under any material
order, writ, judgment, injunction, decree, determination or award of any court,
arbitrator or government, commission, board, bureau, agency or other
instrumentality binding upon the Manager of which we are aware, or (v) to our
knowledge, result in the creation or imposition of any Lien (other than
Permitted Liens) against or upon the Manager's right, title or interest in and
to the Management Agreement.
2.6 To our knowledge, there are no actions or proceedings
against either of Prime Alaska or the Manager, pending or overtly threatened in
writing (other than such matters affecting the cable television industries in
the States of Alaska, Illinois, North Carolina, Texas or Nevada or in the United
States generally), before any court, governmental agency or arbiter which, if
determined adversely as to either of Prime Alaska or the Manager, could have a
materially adverse effect upon such entity.
General Communication, Inc. - Form 8-K
Page 382
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
2.7 To our knowledge, no material authorization, consent,
approval, license, exemption of or filing or registration with any court or
governmental department, commission, board, bureau, agency or other
instrumentality, domestic or foreign (collectively, "Consents"), is or will be
necessary or appropriate to the valid execution, delivery or performance by the
Manager of the Subordination and Assignment of Management Agreement, except for
(i) consents previously obtained, (ii) consents the absence of which would not
adversely affect the Agent's and the Banks' rights or security under the
Subordination and Assignment of Management Agreement, and (iii) consents which
will or may be required in connection with the enforcement by the Agent or the
Banks of their rights with respect to the interests assigned pursuant to the
Subordination and Assignment of Management Agreement.
2.8 The provisions of the Subordination and Assignment of
Management Agreement are effective to create in favor of the Agent, for itself
and for the ratable benefit of the Banks, a valid security interest in all
interests of the Manager under the Management Agreement assigned thereunder in
which a security interest may be created under Chapter 9 of the Texas Business
and Commerce Code (the "Code"). Upon the due filing of UCC-1 financing
statements in the appropriate official records of the offices of the Texas
Secretary of State with respect to the interests assigned thereunder, the
Subordination and Assignment of Management Agreement will create in favor of the
Agent a perfected lien on, and security interest in, all interests of the
Manager under the Management Agreement assigned thereunder in which a security
interest may be perfected by filing of UCC-1 financing statements under Chapter
9 of the Code.
3. Assumptions, Limitations, Qualifications and Exceptions
The opinions expressed above are subject to and qualified in all
respects by the following:
3.1 In rendering the opinions expressed in Section 2 above, we
have relied solely upon (i) the factual matters stated in the certificates of
public officials attached as Schedule 2 to this letter, (ii) the certifications
made to us as of this date by officers of Prime Cable Fund I, Inc. pursuant to
the PCFI Officers' Certificate, by officers of the Borrower pursuant to the GCIC
Officers' Certificate and by officers of Prime II Management, Inc. pursuant to
the PIIMI Officers' Certificate, (iii) representations, warranties,
certifications and statements of Prime Alaska and the Manager made pursuant to
the Prime Agreement Documents as to the factual matters set forth therein, (iv)
our review of counterparts of the documents referenced on Schedule 1 hereto, (v)
General Communication, Inc. - Form 8-K
Page 383
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
our review of the Constituent Documents, and (vi) all laws, rules and
regulations which, in our experience, are normally applicable to transactions of
the type contemplated by the provisions of the Prime Agreement Documents, and
although we have made no independent factual investigation with regard to such
matters set forth in (i)-(v) above, we have no knowledge of any matter
inconsistent with the opinions expressed in Section 2 above. The phrase "to our
knowledge" or "of which we are aware," when used in this opinion letter means
the awareness of facts or other information by the attorneys in this firm who
have given substantive legal attention to representation of Prime Alaska and the
Manager in connection with the Loan Agreement. We have assumed that neither the
Agent, the Banks nor their counsel know of any reason why the opinions set forth
in this opinion letter may be incorrect.
3.2 We have assumed that the Prime Agreement Documents will be
administered in accordance with the terms thereof, and that there are no other
contracts or agreements (other than the other Loan Documents), written or oral,
between or among any of the Borrower, the Banks, the Agent, Prime Alaska, the
Manager or any other parties to any thereof, with respect to the Loans.
3.3 We express no opinion regarding the accuracy, or the
effect of any breach, of any representation, warranty or certification under the
Prime Agreement Documents to be made, remade or renewed after the date hereof
with respect to any future event, condition or occurrence. The opinions
expressed by us are limited to the matters expressly stated herein and no
opinions are implied, or should be inferred, beyond the matters expressly so
stated.
3.4 To the extent our opinions herein may be affected by such
matters, we have assumed for purposes hereof, (i) that each party to the Prime
Agreement Documents (other than Prime Alaska and the Manager) is duly organized;
(ii) that each party to the Prime Agreement Documents (other than Prime Alaska
and the Manager) is validly existing and in good standing under the laws of the
jurisdiction of its organization and in each other jurisdiction in which the
ownership of its properties or the conduct of its business requires such party
to qualify to do business and has the power to own, lease and operate its
properties therein and to conduct its business therein as now conducted; (iii)
that the Prime Agreement Documents have been duly authorized (except as to the
Manager); (iv) that the Prime Agreement Documents have been properly executed
and delivered by all parties thereto (other than the Manager); (v) that the
Prime Agreement Documents constitute the legal, valid and binding obligations of
the parties thereto, enforceable against them in accordance with their
respective terms; (vi) that each such party
General Communication, Inc. - Form 8-K
Page 384
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
(other than Prime Alaska and the Manager) has the requisite corporate or other
organizational power and authority to execute and deliver the Prime Agreement
Documents and perform its obligations thereunder, as applicable; and (vii) that
the execution, delivery and performance by each party (other than the Manager)
to the Agreement Documents does not and will not violate any statutes, laws,
ordinances, regulations, rules, orders, writs, injunctions or decrees or any
court or governmental authority of any jurisdiction applicable to each such
party or its assets.
3.5 With your permission, we express no opinions as to any
matters involving (i) choices or conflicts of laws, or (ii) applicable usury
laws. We have, with your permission, assumed, without inquiry, with respect to
all of the Prime Agreement Documents that the internal laws, and not the law of
conflicts, of the State of New York apply and that the internal laws of the
State of New York are the same as the internal laws of the State of Texas;
provided, however, with respect to the opinions set forth in Paragraph 2.8
above, we have assumed that the perfection of the security interests described
therein is governed by the laws of the State of Texas as if all parties and all
collateral were located in the State of Texas at all relevant times.
3.6 With your approval, we express no opinion (i) as to the
creation of perfection o security interests in any assets or properties of any
Person, except to the limited extent set forth in Paragraph 2.8 above, or (ii)
with respect to matters governed by the law of the States of Alaska or New York.
3.7 We are qualified to practice law in the State of Texas
only and, with your approval, we have made no investigation of and express no
opinion with respect to the laws of any other state or jurisdiction, other than
(a) applicable federal laws (except as noted below), and (b) the Delaware
Revised Uniform Limited Partnership Act, as currently in effect, insofar as the
same relate to the due organization, qualification and power of limited
partnerships organized in such State. Furthermore, with your approval, we
express no opinion with respect to (i) matters governed by the Federal
Communications Act of 1934, as amended, and the rules and regulations of the
Federal Communications Commission thereunder, (ii) copyright matters under Title
17 of the United States Code, and the rules and regulations of the United States
Copyright Office thereunder, (iii) matters governed by the Federal Aviation Act
of 1958, as amended, and the rules and regulations of the Federal Aviation
Administration thereunder, (iv) land use, environmental or ecological laws,
statutes or regulations, or (v) ordinances of municipalities, counties and
similar political subdivisions of the State of Texas.
General Communication, Inc. - Form 8-K
Page 385
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
3.8 With respect to the opinions expressed in Paragraph 2.8
above, we have assumed (i) the attachment of the proper Schedule 1 to each UCC-1
financing statement to which a Schedule 1 is to be attached, (ii) the proper
filing of UCC-1 financing statements in the offices of the Secretary of State of
Texas, (iii) that the Manager's rights under the Management Agreement which are
collaterally assigned to the Agent and the Banks under the Subordination and
Assignment of Management Agreement (the "Assigned Manager's Rights") are free
and clear of any Liens, other than Permitted Liens, (iv) that the Manager has
good and sufficient title to the Assigned Manager's Rights, (v) that the Manager
has "rights in the collateral" as that term is used in Section 9.203 of the Code
with respect to the Assigned Manager's Rights, and (vi) that value has been
given by the Agent and the Banks within the meaning of Section 9.203 of the
Code.
3.9 We call your attention to, and our opinions stated in
Paragraph 2.8 above are limited by, the fact that:
(i) The continuation of any security interest and perfection
of any security interest in the Assigned Manager's Rights consisting of
proceeds is limited to the extent set forth in Section 9.306 of the
Code;
(ii) Continuation statements complying with the Code must be
filed with the filing offices in which each UCC-1 financing statement
is filed not more than six months prior to the expiration of a
five-year period dating from the date of filing of the UCC-1 financing
statement (or otherwise within the time permitted by Section 9.403 of
the Code) and subsequent continuation statements must be filed within
six months prior to the end of each subsequent five year period and
amendments or supplements to the UCC-1 financing statements and/or
additional financing statements may be required to be filed in the
event of a change of name, identity or corporate structure of the
debtor or if the debtor changes the jurisdiction of its place of
business (or, if it has more than one place of business, its chief
executive office) or the jurisdiction in which collateral is located;
General Communication, Inc. - Form 8-K
Page 386
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
(ii) In the case of property which becomes collateral after
the date hereof, Section 552 of the Federal Bankruptcy Code limits the
extent to which property acquired by a debtor after the commencement of
a case under the Federal Bankruptcy Code may be subject to a security
interest arising from the security agreement entered into by the debtor
before the commencement of the case; and
(iii) We express no opinion as to the priority of any security
interest.
3.10 Our opinions concerning the perfection of the security
interests in the Assigned Manager's Rights (as that term is defined in Paragraph
2.8 above) are in all cases limited to the borrowing under the Prime Agreement
Documents and such future advances as are made thereunder in accordance with the
terms of the Prime Agreement Documents. No opinion is expressed as to the
effectiveness of the Prime Agreement Documents to grant and create a security
interest with respect to any indebtedness other than that created by borrowings
under the Prime Agreement Documents.
3.11 The opinions stated in the second sentence of Paragraph
2.3 above are subject to, and shall be interpreted in accordance with, the
Bankruptcy and Insolvency Exceptions, Equitable Principals Limitation and Other
Common Qualifications set forth on Schedules 3, 4 and 5 hereto.
3.12 With regard to the opinions expressed concerning the
enforceability of the Subordination and Assignment of Management Agreement, such
enforceability may be limited by the rights of the United States under the
Federal Tax Lien Act of 1966, as amended, and by bankruptcy, fraudulent
conveyance or transfer, insolvency, reorganization, moratorium, liquidation,
probate, conservatorship or similar laws of general application relating to or
affecting the enforcement of creditors' rights, and by limitations applicable to
equitable remedies (regardless of whether enforcement is considered in
proceedings at law or in equity), and by requirements of due process under the
United States Constitution, the Constitution of the State of Texas and other
laws or court decisions limiting the rights of creditors to repossess, foreclose
or otherwise realize upon the property of a debtor without appropriate notice or
hearing or both. We express no opinion as to whether a court would grant
specific performance or any other equitable remedy with respect to the
enforcement of the Subordination and Assignment of Management Agreement.
Further, we express no opinion as to the enforceability of (i) non-judicial
foreclosure, receivership and self-help remedies provided for in the
Subordination and Assignment of Management Agreement; (ii) provisions
General Communication, Inc. - Form 8-K
Page 387
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
which purport to restrict access to legal or equitable remedies or which purport
to establish penalties or evidentiary standards; (iii) provisions relating to
subrogation rights, suretyship, delay or omission of enforcement of remedies and
indemnity; (iv) provisions which purport to appoint the Agent or the Banks, in
any capacity, as the attorney-in-fact or proxy of the Manager; (v) provisions
which purport to waive rights or notices; (vi) provisions relating to consent
judgments, waivers of defenses or the benefits of statutes of limitations,
marshalling of assets, the transferability of any assets which by their nature
are nontransferable, sales in inverse order of alienation, or severance; (vii)
provisions which purport to prohibit or restrict transfer of title to, or the
granting of junior encumbrances of, all or any part of the property covered by
any of the Assigned Manager's Rights; or (viii) so-called "dragnet," "Mother
Hubbard" or "future advance" clauses, as said provisions relate to loans other
than the loans evidenced by the Notes.
3.13 The enforceability of certain of the remedial, waiver,
subrogation, indemnity and other provisions of the Subordination of Assignment
of Management Agreement is further subject to all applicable constitutional,
legislative, judicial and administrative provisions, statutes, decisions,
rulings and other laws, in addition to those described in Paragraph 3.12 above;
however, such laws do not, in our opinion, substantially interfere with the
practical realization of the benefits expressed in the Subordination and
Assignment of Management Agreement (except for the economic consequences of any
procedural delay which may result from such laws).
3.14 You are hereby notified that (a) we do not consider you
to be our client in the matter to which this opinion relates, (b) neither the
Texas Code of Professional Responsibility nor current case law clearly
articulates the circumstances under which an attorney may give a legal opinion
to a person other than the attorney's own client, (c) a court might determine
that it is improper for us to issue, and for you to rely upon, a legal opinion
issued by us when we have acted as counsel to the Prime Entities in connection
with the Loan Agreement, and (d) you may wish to obtain a legal opinion from
your own legal counsel as to the matters addressed in this opinion letter.
General Communication, Inc. - Form 8-K
Page 388
Toronto Dominion (Texas), Inc., eta 1.
October 31, 1996
Page
This opinion is given solely to the Banks, the Agent and their counsel
and shall not be relied upon by any other person or entity other than the Banks,
the Agent, their counsel, examiners and auditors. This opinion may not be
quoted, circulated or published, in whole or in part, or furnished or relied
upon by any other party, without our prior written consent, except as may be
required by process of law or in connection with litigation arising out of the
Agreement Documents, and, except that this opinion letter may be disclosed to
the bank regulatory authorities and may be relied upon by assignees of the Banks
under Section 11.6 of the Loan Agreement. The opinions herein are expressed as
of the date hereof only and not as of some future date. We undertake no
responsibility to update this opinion for events occurring after the date
hereof.
Very truly yours,
EDENS SNODGRASS NICHOLS
& BREELAND, P.C.
By: /s/ Patrick K. Breeland
Its: Vice President
General Communication, Inc. - Form 8-K
Page 389
SCHEDULE 1
Documents Examined
Terms used herein and defined in the Loan Agreement are used herein as therein
defined. Reference to each document includes reference to all exhibits thereto.
1. Loan Agreement.
2. Subsidiary Security Agreement.
3. Subordination and Assignment of Management Agreement.
4. Subsidiary Guaranty Agreement.
5. Deed of Trust dated October 31, 1996 executed by Prime Cable of
Alaska, L. P., as trustor, to the Agent, as trustee (the "Mortgage").
6. GCI Cable, Inc. Officers' Certificate dated October 31, 1996 (the
"GCIC Officers' Certificate").
7. Prime II Management, Inc. Officers' Certificate dated October 31, 1996
("PIIMI Officers' Certificate").
8. Prime Cable Fund I, Inc. Officers' Certificate dated October 31, 1996
("PCFI Officers' Certificate").
General Communication, Inc. - Form 8-K
Page 390
SCHEDULE 2
Certificates of Public Officials
Attached.
General Communication, Inc. - Form 8-K
Page 391
SCHEDULE 3
Bankruptcy and Insolvency Exceptions
Paragraph 2.3 of this opinion letter is subject to the effect of
bankruptcy, insolvency, reorganization, receivership, moratorium and other
similar laws affecting the rights and remedies of creditors generally. This
exception includes;
(a) the Federal Bankruptcy Code and thus comprehends, among
others, matters of turn-over, automatic stay, avoiding powers,
fraudulent transfer, preference, discharge, conversion of a
non-recourse obligation into a recourse claim, limitations on
ipso facto and anti-assignment clauses and the coverage of
pre-petition security agreements applicable to property
acquired after a petition is filed;
(b) all other Federal and state bankruptcy, insolvency,
reorganization, receivership, moratorium, arrangement and
assignment for the benefit of creditors laws that affect the
rights and remedies of creditors generally (not just creditors
of specific types of debtors);
(c) all other Federal bankruptcy, insolvency, reorganization,
receivership, moratorium, arrangement and assignment for the
benefit of creditors laws that have reference to or affect
generally only creditors of specific types of debtors and
state laws of like character affecting generally only
creditors of financial institutions and insurance companies;
(d) state fraudulent transfer and conveyance laws; and
(e) judicially developed doctrines relevant to any of the
foregoing laws, such as substantive consolidation of entities.
General Communication, Inc. - Form 8-K
Page 392
SCHEDULE 4
Equitable Principles Limitation
Paragraph 2.3 of this opinion letter is subject to the effect of
general principles of equity, whether applied by a court of law or equity. This
limitation includes principles:
(a) governing the availability of specific performance, injunctive
relief or other equitable remedies, which generally place the
award of such remedies, subject to certain guidelines, in the
discretion of the court to which application for such relief
is made;
(b) affording equitable defenses (e.g., waiver, laches and
estoppel) against a party seeking enforcement;
(c) requiring good faith and fair dealing in the performance and
enforcement of a contract by the party seeking its
enforcement;
(d) requiring reasonableness in the performance and enforcement of
an agreement by the party seeking enforcement of the contract;
(e) requiring consideration of the materiality of (i) a party's
breach and (ii) the consequences of the breach to the party
seeking enforcement;
(f) requiring consideration of the impracticability or
impossibility of performance at the time of attempted
enforcement; and
(g) affording defenses based upon the unconscionability of the
enforcing party's conduct after the parties have entered into
the contract.
General Communication, Inc. - Form 8-K
Page 393
SCHEDULE 5
Other Common Qualifications
Paragraph 2.3 of this opinion letter is subject to the effect of
generally applicable rules of Texas Law, if any, that:
(a) limit or affect the enforcement of provisions of a contract
that purport to require waiver of the obligations of good
faith, fair dealing, diligence and reasonableness;
(b) provide that forum selection clauses in contracts are not
necessarily binding on the court(s) in the forum selected;
(c) limit the availability of a remedy under certain circumstances
where another remedy has been elected;
(d) limit the right of a creditor to use force or cause a breach
of the peace in enforcing rights;
(e) relate to the sale or disposition of collateral or the
requirements of a commercially reasonable sale;
(f) limit the enforceability of provisions releasing, exculpating
or exempting a party from, or requiring indemnification of a
party for, liability for its own action or inaction, to the
extent the action or inaction involves gross negligence,
recklessness, willful misconduct or unlawful conduct;
(g) may, where less than all of a contract may be unenforceable,
limit the enforceability of the balance of the contract to
circumstances in which the unenforceable portion is not an
essential part of the agreed exchange;
(h) govern and afford judicial discretion regarding the
determination of damages and entitlement to attorneys' fees
and other costs;
(i) may, in the absence of a waiver or consent, discharge a
guarantor to the extent that (i) action by a creditor impairs
the value of collateral securing guaranteed debt to the
detriment of the guarantor, or (ii) guaranteed debt is
materially modified; and
(j) may permit a party who has materially failed to render or
offer performance required by the contract to cure that
failure unless (i) permitting a cure would unreasonably hinder
the aggrieved party from making substitute arrangements for
performance, or (ii) it was important in the circumstances to
the aggrieved party that performance occur by the date stated
in the contract.
General Communication, Inc. - Form 8-K
Page 394
EXHIBIT N-3
[GCI LETTERHEAD]
October 31, 1996
Toronto Dominion (Texas), Inc. The Chase Manhattan Bank N.A.
909 Fannin, Suite 1700 One Chase Manhattan Plaza
Houston, Texas 77010 4th Floor
New York, New York 10081
NationsBank of Texas, N.A. The Bank of New York
901 Main Street, 64th Floor One Wall Street
Dallas, Texas 75202 16th Floor
New York, New York 10286
Credit Lyonnais New York Branch Banque Paribas
1301 Avenue of the Americas 2029 Century Park East
New York, New York 100 19 Suite 3900
Los Angeles, California 90067
PNC Bank, National Association The First National Bank of Maryland
100 South Broad Street 25 South Charles Street
Philadelphia, Pennsylvania 19101 18th Floor
Baltimore, Maryland 21201
Ladies and Gentlemen:
I am communications counsel for GCI Cable, Inc. ("Cable"), GCI
Cable/Fairbanks, Inc. ("Fairbanks"), and GCI Cable/Juneau, Inc. ("Juneau"),
Alaska corporations, representing such companies principally in matters before
the Alaska Public Utilities Commission ("APUC") concerning the regulations by
this governmental agency of various aspects of their operations. This opinion is
rendered pursuant to Section 3(a) of the Loan Agreement dated as of October 31,
1996 ("Loan Agreement") by and among Toronto Dominion (Texas), Inc., NationsBank
of Texas, N.A., Credit Lyonnais New York Branch, The Chase Manhattan Bank N.A.,
The Bank of New York, Banque Paribas, PNC Bank, National Association and The
First National Bank of Maryland, as lenders ("Banks"). Capitalized terms used in
this
General Communication, Inc. - Form 8-K
Page 395
October 31, 1996
Page
opinion letter without definition have the same meanings as in the Loan
Agreement.
1. Cable holds APUC Certificates Nos. 143, 144, 246, 261 and 287.
Fairbanks holds APUC Certificate No. 252. Juneau holds APUC
Certificate No. 156. Cable will, upon acquisitions pursuant to
three Asset Purchase Agreements dated as of May 10, 1996, hold
APUC Certificates Nos. 157, 158, 164, 168, 191, 245, 367 and
401. These APUC certificates are in full force and effect,
without any materially adverse modification, amendment,
revocation, suspension, termination, cancellation, reformation
or condition. Such certificates constitute all the APUC
authority required to operate the Cable Systems in areas over
which the APUC has jurisdiction. To the best of my knowledge,
after due inquiry, there is no APUC proceeding or any APUC
investigation pending or threatened, for the purpose of
modifying, revoking, terminating, suspending, canceling or
reforming any of such certificates.
2. Cable, Fairbanks, and Juneau operate the Cable Systems in
accordance with all material APUC rules, regulations and
orders.
This opinion has been prepared solely for your use and that of your
counsel in connection with the closing of the transactions contemplated under
the Loan Agreement, and should not be quoted in full or in part or otherwise
referred to, or be filed with or furnished to any governmental agency or other
person or entity not involved in such transactions without prior consent, except
as may be required by process of law or in connection with litigation arising
out of these transaction, and except that this opinion letter may be disclosed
to your bank regulatory authorities and may be relied upon by assignees of the
Banks under Section 11.6 of the Loan Agreement. The matters set forth in the
opinions stated in this letter are made as of the date of the letter.
Very truly yours,
James R. Jackson
Regulatory Attorney
General Communication, Inc. - Form 8-K
Page 396
EXHIBIT N-4
[COLE, RAYWID & BRAVERMAN, L.L.P. LETTERHEAD]
October 31, 1996
GCI Cable, Inc.
2550 Denali Street, Suite 1000
Anchorage, AK 99503
Ladies and Gentlemen:
This letter is furnished to you pursuant to Section 7.9 of that certain
Securities Purchase and Sale Agreement dated as of May 2, 1996, as amended, (the
"Agreement"), among GCI Cable, Inc. (as assignee of General Communication,
Inc.), an Alaska corporation ("Buyer") and the direct and indirect equity owners
and profit participation rights holders of Prime Cable of Alaska, L.P., a
Delaware limited partnership (the "Company") and Prime II Management, L.P., a
Delaware limited partnership.
As communications counsel for the Company, we are engaged in the
representation of the Company before the Federal Communications Commission
("FCC") in connection with its cable television business in communities
identified in Schedule I hereto (the "System"). We have examined such records,
certificates and other documents and have considered such questions of law as
relate to the Company and the System as we have deemed necessary or appropriate
for purposes of this opinion. This opinion is limited to the Communications Act
of 1934, as amended, including amendments effected by the Telecommunications Act
of 1996 (the "Communications Act"), the rules and regulations of the FCC (the
"FCC Regulations"),
General Communication, Inc. - Form 8-K
Page 397
GCI Cable, Inc.
October 31, 1996
Page
Section 111 of the Copyright Act of 1976, as amended (17 U.S.C. section 111)
(the "Copyright Act"), and the Rules and Regulations of the Federal Aviation
Administration ("FAA"), as applicable to the System as operated by the Company.
Except as specifically provided, we offer no opinion as to the Company's
compliance with the Cable Television Consumer Protection and Competition Act of
1992, Pub. L. No. 102-3, 106 Stat. 1460 (1992), or those FCC regulations
promulgated pursuant to such Act. In rendering this opinion, we have assumed the
genuineness of signatures on documents and the conformity to the original of all
copies examined by or submitted to us of photocopies or conformed copies. As to
various questions of fact in connection with this opinion, we have relied upon
examinations of available files of our office, those of the FCC and the United
States Copyright Office (the "Copyright Office"), and pertinent statements and
representations of officers, directors and responsible representatives of the
Company. We have not undertaken independent field investigation to verify the
accuracy of this information, and express no opinion regarding technical matters
or matters that would require on-scene knowledge of the System's operations,
technical or engineering matters, or local franchising matters.
Based upon and limited by the foregoing, we are of the opinion that, as
of the date set forth above:
1. Each community listed in Schedule I hereto has been registered with
the FCC. Pursuant to FCC rules, such registration authorizes the commencement of
cable television operations in the subject community.
2. The Company holds all licenses, receive-only earth station
registrations, permits and authorizations required from the FCC to operate the
System, which licenses, permits, authorizations and registrations are listed in
Schedule II hereto (the "FCC Licenses"). The FCC Licenses are the only licenses,
registrations, permits or authorizations required to continue operating the
System as presently operated. Each FCC License has been validly issued by the
FCC, remains in full force and effect, and the transfer of control of the
Company to Buyer on the Closing Date as defined in the Agreement has been
approved by the FCC, to the extent such approval is required, and such transfer
authorizations are in full force and effect. To the best of our knowledge after
due inquiry, we have no knowledge of any event that would allow, or after notice
or lapse of time would allow, revocation, termination, suspension or
cancellation of any FCC License or result in any other material impairment of
the rights of the Company.
3. All materially required FCC filings required to be made by the
Company in connection with its operation of the System have been made,
including, but not limited to,
General Communication, Inc. - Form 8-K
Page 398
GCI Cable, Inc.
October 31, 1996
Page
Registration Statements and FCC Annual Report Form 325 Schedule A, to the extent
such forms are required.
4. All FCC authorizations needed to utilize the frequencies currently
used by the System have been obtained. The System has submitted to the FCC the
required notifications for the use of certain frequencies in the 108-137 MHZ or
225-400 MHZ bands. These frequencies, the geographic coordinates or the
approximate center of the System service area, and the authorized radius of the
System, are listed on Schedule III hereto. Based on information provided by the
Company and information filed with the FCC and, to the best of our knowledge,
after due inquiry, regarding frequency use and the radius of the System, these
are the only aeronautical authorizations necessary at this time to enable the
System to operate in compliance with FCC regulations.
5. Basic Signal Leakage Performance Reports (FCC Annual Report Forms
320) (showing complying index scores) for 1990-1995 are on file with the FCC for
each community unit operated by the System.
6. EEO Annual Report Forms 395(A) have been filed with the FCC for each
employment unit associated with the System for calendar years 1988-1995. The
employment unit has been certified by the FCC for calendar years 1988-1995. The
1996 certification is pending. No FCC inquiries have been received concerning
the 1995 Form 395(A).
7. Except as provided in Schedule IV, the Company has provided
subscriber privacy notices, complaint procedure notices and customer service
notices to subscribers of the System, on an annual basis, as required. The
Company also provides subscriber privacy notices to new subscribers at the time
of installation. Our opinion is limited to the fact that such notices have been
provided, and we express no opinion as to whether the contents of such notices
comply with the requirements of the Communications Act or FCC Regulations. The
Company has advised us that to the best of its knowledge, after due inquiry, the
System has received no written challenges to its compliance with the subscriber
privacy provisions of the Communications Act.
8. There is no FCC judgment, decree or order which has been issued
against the Company with respect to the System, nor is there any FCC action,
proceeding or investigation pending or, to the best of our knowledge, threatened
by the FCC against the Company with respect to the System.
General Communication, Inc. - Form 8-K
Page 399
GCI Cable, Inc.
October 31, 1996
Page
9. The timely filing of the periodic Statements of Account and
accompanying royalty fees qualifies the Company for a compulsory license for the
carriage of the broadcast signals utilized by the System. The Company has filed
all required Statements of Account and supplements thereto, and, to the best of
our knowledge, has timely paid its statutory royalties for all accounting
periods beginning at least as early as the second accounting period of 1992, and
all primary transmissions listed in the latest Statements of Account qualify for
a compulsory copyright license. Although we render no opinion as to the
methodology or calculations used to determine "gross receipts" for copyright
purposes, there have been no inquiries received from the Copyright Office or any
other party which challenge or question either the computation or amount of any
royalty payments or the validity of the Statements of Account, and there is no
claim, action or demand for copyright infringement or for non-payment of
royalties, pending or, to the best of our knowledge, threatened against the
Company.
10. Except for any necessary FCC approvals which have been obtained,
the execution, delivery and performance of the Agreement does not require the
approval of the FCC, will not result in any violation of the rules and
regulations of the FCC, and will not cause any forfeiture or impairment of any
FCC license, authorization or permit of the Company, provided that Buyer
complies with any applicable ownership restrictions.
11. To the best of our knowledge, based on information provided by the
Company, to the extent required by the rules of the FAA, the Company has
obtained clearance from the FAA for the towers or other antenna structures used
by the System which are more than 200 feet above ground level or closer than
20,000 feet from the end of the nearest runway of an aircraft landing area.
12. We are advised by the Company that it has obtained all necessary
retransmission consents for the broadcast signals currently carried on the
System and that all such consents are assignable and are currently in full force
and effect.
13. We are advised by the Company that it has not received notification
from any franchise authority pursuant to Section 76.309(a) of the FCC's rules.
14. To the best of our knowledge, based on information provided by the
Company, the System is carrying all of the "must-carry" signals required to be
carried pursuant to Federal law. To the best of our knowledge, based on
information provided by the Company, there have been no "must-carry" complaints
filed against the System.
General Communication, Inc. - Form 8-K
Page 400
GCI Cable, Inc.
October 31, 1996
Page
This opinion has been prepared solely for Buyer's use in connection
with the closing of transactions under the Agreement, and may not be relied upon
by, filed with or furnished to any other person or entity, other than Buyer's
senior lenders, without the prior written consent of this firm. This opinion
letter may not be quoted, circulated or published, in whole or in part, or
furnished to or relied upon by any other party, or otherwise referred to, or be
filed with or furnished to any governmental agency or other person entity not
involved in the transactions under the Agreement, other than Buyer's senior
lenders, without our prior written consent. The Senior Lenders to GCI Cable,
Inc., under a loan Agreement dated as of October 31, 1996, with the Lenders
shown on Schedule A attached hereto, may rely upon this opinion.
Very truly yours,
COLE, RAYWID & BRAVERMAN, L.L.P.
By: /s/ Joseph R. Reifer
A Member of the Firm
General Communication, Inc. - Form 8-K
Page 401
SCHEDULE I
COMMUNITY FCC CUID NUMBER
- ---------------------------------------------------
Anchorage, AK AK0028
Eagle River, AK AK0029
Elmendorf AFB, AK AK0032
Ft. Richardson Army Post, AK AK0031
Chugiak, AK AK0030
Bethel, AK AK0016
Kenai, AK AK0042
Soldotna, AK AK0043
Ridgeway, AK AK0044
General Communication, Inc. - Form 8-K
Page 402
SCHEDULE II
FCC AUTHORIZATIONS:
Cable Television Relay Station Authorization(s):
Call Sign Location Expiration Date
- --------------------------------------------------------------------
WAP-911 Anchorage, AK September 1, 2000
Business Radio Authorization(s):
Call Sign Location Expiration Date
- --------------------------------------------------------------------
KNCD-389 Anchorage, AK December 19, 1999
WNJY-380 Bethel, AK June 30, 1999
KNHN-226 Kenai, AK June 20, 1999
WPFT-991 Anchorage, AK October 5, 1999
Private Operational Fixed Microwave Station Authorization(s):
Call Sign Location Expiration Date
- --------------------------------------------------------------------
WPJD-479 Anchorage, AK March 5, 2001
Receive Only Earth Station Authorization(s):
Call Sign Location Expiration Date
- --------------------------------------------------------------------
KE-92 Anchorage, AK February 17, 2001
E3455 Bethel, AK November 13, 2001
E930263 Kenai, AK April 19, 2003
General Communication, Inc. - Form 8-K
Page 403
SCHEDULE III
SYSTEM: Anchorage, AK
COORDINATES: 61-10-49N; 149-53-06W
RADIUS: 36 km
CHANNEL FREQUENCY FCC NOTIFICATION DATE
- -------------------------------------------------------------------------------
Control 113.2250 October 28, 1996
A-2 109.2750 October 28, 1996
A-1 115.2750 October 28, 1996
A 121.2625 October 28, 1996
B 127.2625 October 28, 1996
C 133.2625 October 28, 1996
L 229.2625 October 28, 1996
M 235.2625 October 28, 1996
N 241.2625 October 28, 1996
O 247.2625 October 28, 1996
P 253.2625 October 28, 1996
Q 259.2625 October 28, 1996
R 265.2625 October 28, 1996
S 271.2625 October 28, 1996
T 277.2625 October 28, 1996
U 283.2625 October 28, 1996
V 289.2625 October 28, 1996
W 295.2625 October 28, 1996
AA 301.2625 October 28, 1996
BB 307.2625 October 28, 1996
CC 313.2625 October 28, 1996
DD 319.2625 October 28, 1996
EE 325.2625 October 28, 1996
FF 331.2750 October 28, 1996
GG 337.2625 October 28, 1996
HH 343.2625 October 28, 1996
II 349.2625 October 28, 1996
JJ 355.2625 October 28, 1996
KK 361.2625 October 28, 1996
LL 367.2625 October 28, 1996
MM 373.2625 October 28, 1996
NN 379.2625 October 28, 1996
OO 385.2625 October 28, 1996
PP 391.2625 October 28, 1996
QQ 397.2625 October 28, 1996
General Communication, Inc. - Form 8-K
Page 404
SCHEDULE III
(continued)
SYSTEM: Kanai, AK
COORDINATES: 60-34-04N; 151-07-51W
RADIUS: 12.7 km
CHANNEL FREQUENCY FCC NOTIFICATION DATE
- -------------------------------------------------------------------------------
A-2 109.2750 February 1, 1990
A-1 115.2750 February 1, 1990
A 121.2625 February 1, 1990
B 127.2625 February 1, 1990
C 133.2625 February 1, 1990
L 229.2625 February 1, 1990
M 235.2625 February 1, 1990
N 241.2625 February 1, 1990
O 247.2625 February 1, 1990
P 253.2625 February 1, 1990
Q 259.2625 February 1, 1990
R 265.2625 February 1, 1990
S 271.2625 February 1, 1990
T 277.2625 February 1, 1990
U 283.2625 February 1, 1990
V 289.2625 February 1, 1990
W 295.2625 February 1, 1990
AA 301.2625 February 1, 1990
BB 307.2625 February 1, 1990
CC 313.2625 February 1, 1990
DD 319.2625 February 1, 1990
EE 325.2625 February 1, 1990
FF 331.2750 February 1, 1990
GG 337.2625 February 1, 1990
HH 343.2625 February 1, 1990
II 349.2625 February 1, 1990
JJ 355.2625 February 1, 1990
KK 361.2625 February 1, 1990
LL 367.2625 February 1, 1990
MM 373.2625 February 1, 1990
NN 379.2625 February 1, 1990
OO 385.2625 February 1, 1990
PP 391.2625 February 1, 1990
QQ 397.2625 February 1, 1990
General Communication, Inc. - Form 8-K
Page 405
SCHEDULE III
(continued)
SYSTEM: Bethel, AK
COORDINATES: 60-47-55N; 161-45-55W
RADIUS: 7 km
CHANNEL FREQUENCY FCC NOTIFICATION DATE
- -------------------------------------------------------------------------------
A-2 109.2750 February 1, 1990
A-1 115.2750 February 1, 1990
A 121.2625 February 1, 1990
B 127.2625 February 1, 1990
C 133.2625 February 1, 1990
L 229.2625 February 1, 1990
M 235.2625 February 1, 1990
N 241.2625 February 1, 1990
O 247.2625 February 1, 1990
P 253.2625 February 1, 1990
Q 259.2625 February 1, 1990
R 265.2625 Feburary 1, 1990
S 271.2625 February 1, 1990
T 277.2625 February 1, 1990
U 283.2625 February 1, 1990
V 289.2625 February 1, 1990
W 295.2625 February 1, 1990
AA 301.2625 February 1, 1990
BB 307.2625 February 1, 1990
CC 313.2625 February 1, 1990
DD 319.2625 February 1, 1990
EE 325.2625 February 1, 1990
FF 331.2750 February 1, 1990
GG 337.2625 February 1, 1990
HH 343.2625 February 1, 1990
II 349.2625 February 1, 1990
JJ 355.2625 February 1, 1990
KK 361.2625 February 1, 1990
LL 367.2625 February 1, 1990
MM 373.2625 February 1, 1990
NN 379.2625 February 1, 1990
OO 385.2625 February 1, 1990
PP 391.2625 February 1, 1990
QQ 397.2625 February 1, 1990
General Communication, Inc. - Form 8-K
Page 406
SCHEDULE IV
Subscriber Notices:
Privacy Notices for 1988, 1992 and 1993 were not sent by Sellers.
Complaint Procedure Notices for 1992 were not sent by Sellers.
Customer Services Notices for 1994 and 1995 were not sent by Sellers.
General Communication, Inc. - Form 8-K
Page 407
EXHIBIT O
FORM OF CERTIFICATE OF FINANCIAL CONDITION
GCI Cable, Inc., an Alaska corporation (the "Borrower"), acting by and
through , its , in connection with
that certain Loan Agreement dated October 31, 1996 (the "Loan Agreement") of
even date among the Borrower, the various financial institutions which are party
thereto (the "Banks"), Toronto Dominion (Texas), Inc., Credit Lyonnais, Cayman
Island Branch, NationsBank of Texas, N.A., and The Chase Manhattan Bank, N.A. as
managing agents (collectively, the "Managing Agents") and Toronto Dominion
(Texas), Inc., as administrative agent for the Managing Agents and the Banks
(the "Administrative Agent"), pursuant to which the Banks have agreed to make
Loans to the Borrower in an aggregate principal amount not to exceed
$205,000,000, as evidenced by those certain promissory notes of even date by the
Borrower to the order of the Banks, the undersigned hereby certifies to the
Administrative Agent, the Managing Agents and the Banks that:
1. Capitalized terms used herein and not otherwise defined
herein are used as defined in the Loan Agreement.
2. The financial statements and all other documents relating
to the Borrower's present or projected financial future condition provided to
the Administrative Agent, the Managing Agents and the Banks in connection with
the Loan Agreement, including, without limitation, the balance sheet attached
hereto as Schedule 1, have been prepared by the undersigned or under the
supervision of the undersigned, or reviewed by the undersigned, with due
diligence and in full awareness of the Administrative Agent's, the Managing
Agents' and the Banks' reliance on the information contained therein in reaching
their decision to make the Loans.
3. The Borrower, as a result of the Loans and any obligations
incurred in connection therewith and the other transactions contemplated by the
Loan Agreement, believes in good faith that it has not incurred and will not
incur debts beyond its ability to satisfy them as they mature, and will have a
positive cash flow after paying all of its anticipated Indebtedness, including
the obligations due to the Banks under the Loan Agreement.
4. After giving effect to the Loans and the obligations
incurred in connection therewith and the other transactions contemplated by the
Loan Agreement, the Borrower anticipates that it will have sufficient proceeds
from its cash flow, the sale of current assets in the ordinary course of
business, and the proceeds of contemplated sales of assets not necessary for the
Borrower's business, to pay recurring current debt and long-term debt service as
such debts mature. The cash flow of the Borrower combined with asset sales
proceeds, is expected to be sufficient
General Communication, Inc. - Form 8-K
Page 408
to provide the cash needed to repay existing long-term indebtedness as such debt
matures.
5. Based on the present and anticipated needs for capital of
the businesses conducted, or anticipated to be conducted in the future by the
Borrower, and after giving effect to the Loans, the Borrower will not be left
with unreasonably small capital to finance the needs and anticipated needs of
the Borrower's business.
IN WITNESS WHEREOF, the Borrower has caused the execution of
this Certificate this day of October, 1996.
GCI CABLE, INC.
By: /s/ John M. Lowber
Title: Secretary/Treasurer
Schedule 1 - Balance Sheet of the Borrower as of
October 31, 1996, after giving effect
to the closing of the Loans and the Cooke
Acqusition as of the Agreement Date, and on
a pro forma basis as if the Rock Acquisition
had closed on such date
General Communication, Inc. - Form 8-K
Page 409
EXHIBIT P
GCI Cable, Inc.
1997 Subscriber Report
BASIC SERVICE
- -----------------------------------------------------------------------------------------------------------------------------------
Homes Connections
----------------------------------------------------------------------------------------------
Plant Miles Passed Adds Disconnects Actual Budget Hotel Rooms Sat. %
- -----------------------------------------------------------------------------------------------------------------------------------
Jan-97
Feb-97
Mar-97
Apr-97
May-97
Jun-97
Jul-97
Aug-97
Sep-97
Oct-97
Nov-97
Dec-97
Jan-98
- -----------------------------------------------------------------------------------------------------------------------------------
0 0
===================================================================================================================================
PAY SERVICES ADDITIONAL OUTLETS
- ---------------------------------------------------------------------------- ----------------------------
Connections
-----------------------------------------------
Actual Budget Hotel Rooms Sat. %* Actual Budget
- ---------------------------------------------------------------------------- ----------------------------
Jan-97
Feb-97
Mar-97
Apr-97
May-97
Jun-97
Jul-97
Aug-97
Sep-97
Oct-97
Nov-97
Dec-97
Jan-98
- ---------------------------------------------------------------------------- ----------------------------
============================================================================ ============================
* Saturation % computed exclusive of hotel rooms.
General Communication, Inc. - Form 8-K
Page 410
EXHIBIT Q
FORM OF SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (this "Agreement"), dated as of
October 31, 1996 is made by and among GCI CABLE, INC., an Alaska corporation
(the "Borrower"), GENERAL COMMUNICATION, INC., an Alaska corporation (the
"Subordinated Creditor") and TORONTO DOMINION (TEXAS), INC. (the "Administrative
Agent").
Recitals
1. The Borrower, the Managing Agents, Co-Agents, and the Banks
(as defined in the Loan Agreement) and the Administrative Agent are parties to
that certain Loan Agreement dated as of October 31, 1996 (as amended, modified,
substituted and replaced, from time to time, the "Loan Agreement") pursuant to
which the Banks have made loans to the Borrower (collectively, the "Loans") and
the Borrower has executed and delivered to the Banks one or more promissory
notes (each, as amended, modified, substituted and replaced from time to time, a
"Note").
2. The Borrower may hereafter from time to time become
indebted or otherwise obligated to the Subordinated Creditor. (All indebtedness
and other obligations of the Borrower to the Subordinated Creditor now or
hereafter existing (whether created directly or acquired by assignment or
otherwise), and interest, fees and premiums, if any, thereon and other amounts
payable in respect thereof or in connection therewith, are hereinafter referred
to as the "Subordinated Debt".)
3. It is a condition precedent to the incurrence of
Subordinated Debt by the Borrower that the Subordinated Creditor shall have
executed and delivered this Agreement.
NOW, THEREFORE, in consideration of the premises and in order
to induce the Administrative Agent, the Managing Agents, the Co-Agents and the
Banks to permit the Borrower to incur the Subordinated Debt, the Subordinated
Creditor, the Borrower and the Administrative Agent, for itself and for the
ratable benefit of the Banks, each hereby agree that all capitalized terms used
herein and not otherwise defined herein are used herein as defined in the Loan
Agreement and further agree as follows:
SECTION 1. Agreement to Subordinate. The Subordinated Creditor
and the Borrower each agrees that the Subordinated Debt shall be subordinate, to
the extent provided herein, to the prior payment in full of all Obligations of
the Borrower now or hereafter existing under the Loan Agreement, any Note and
the other Loan Documents, whether for principal, interest (including, without
limitation, interest, as provided in the Loan Agreement
General Communication, Inc. - Form 8-K
Page 411
and any Note, accruing after the filing of a petition initiating any proceeding
referred to in Section 2(a), whether or not such interest accrues after the
filing of such petition for purposes of Title 11 of the United States Code or is
an allowed claim in such proceeding), fees, expenses or otherwise. For purposes
of this Agreement, the Obligations shall not be deemed to have been paid in full
until the Commitment has been terminated and the Administrative Agent, for the
ratable benefit of the Banks, shall have received indefeasible payment of the
Obligations in full in cash with such payment not being avoidable or subject to
defeasement in any proceeding referred to in Section 2(a)(ii).
SECTION 2. Events of Subordination.
(a) (i) So long as the Obligations have not been paid in full, no
payment (including any payment that may be payable by reason of any other
indebtedness of the Borrower being subordinated to payment of the Subordinated
Debt) shall be made by or on behalf of the Borrower for or on account of the
Subordinated Debt, and the Subordinated Creditor shall not take or receive from
the Borrower, directly or indirectly, in cash or other property or by set-off or
in any other manner, including, without limitation, from or by way of
collateral, payment of all or any of the Subordinated Debt, unless and until the
Obligations shall have been paid in full; and
(ii) In the event of any dissolution, winding up, liquidation,
arrangement, reorganization, adjustment, protection, relief or composition of
the Borrower or its debts, whether voluntary or involuntary, in any bankruptcy,
insolvency, arrangement, reorganization, receivership, relief or other similar
case or proceeding under any Federal or State bankruptcy or similar law or upon
an assignment for the benefit of creditors or any other marshalling of the
assets and liabilities of the Borrower or otherwise, the Administrative Agent,
for itself and for the ratable benefit of the Banks, shall be entitled to
receive payment in full of the Obligations before the Subordinated Creditor is
entitled to receive any payment of all or any of the Subordinated Debt, and any
payment or distribution of any kind (whether in cash, property or securities)
that otherwise would be payable or deliverable upon or with respect to the
Subordinated Debt in any such case, proceeding, assignment, marshalling or
otherwise (including any payment that may be payable by reason of any other
indebtedness of the Borrower being subordinated to payment of the Subordinated
Debt) shall be paid or delivered directly to the Administrative Agent for
application (in the case of cash) to, or as collateral (in the case of non-cash
property or securities) for, the payment or prepayment of the Obligations until
the Obligations shall have been paid in full.
(b) In the event that any Subordinated Debt is declared due
and payable before its stated maturity, the Administrative Agent, for itself and
for the ratable benefit of the Banks, shall, as provided in the Loan Agreement,
be entitled to receive payment in full of all amounts due or to become due on or
in respect of all Obligations before the Subordinated Creditor is entitled to
receive any payment (including any payment which may be payable by reason of the
payment of any other indebtedness of the Borrower being
General Communication, Inc. - Form 8-K
Page 412
subordinated to the payment of the Subordinated Debt) by the Borrower on account
of the Subordinated Debt.
SECTION 3. In Furtherance of Subordination. The Subordinated
Creditor agrees as follows:
(a) If any proceeding referred to in Section 2(a)(ii) above is
commenced by or against the Borrower,
(i) the Administrative Agent is hereby irrevocably
authorized and empowered (in its own name or in the name of
the Subordinated Creditor or otherwise), but shall have no
obligation, to demand, sue for, collect and receive every
payment or distribution referred to in Section 2(a) and give
acquittance therefor and to file claims and proofs of claim
and take such other action (including, without limitation,
voting the Subordinated Debt in the best interests of the
Administrative Agent (which shall include the right to vote to
approve a plan of reorganization in bankruptcy in which the
claims of the Subordinated Creditor are impaired), or
enforcing any security interest or other Lien securing payment
of the Subordinated Debt) as it may deem necessary or
advisable for the exercise or enforcement of any of the rights
or interests of the Administrative Agent hereunder; and
(ii) the Subordinated Creditor shall duly and promptly
take such action as the Administrative Agent may reasonably
request (A) to collect the Subordinated Debt for the account
of the Administrative Agent, for itself and on behalf of the
Banks, and to file appropriate claims or proofs of claim in
respect of the Subordinated Debt, (B) to execute and deliver
to the Administrative Agent such powers of attorney,
assignments, or other instruments as the Administrative Agent
may reasonably request in order to enable the Administrative
Agent to enforce any and all claims with respect to, and any
security interests and other Liens securing payment of, the
Subordinated Debt, and (C) to collect and receive any and all
payments or distributions which may be payable or deliverable
upon or with respect to the Subordinated Debt.
(b) All payments or distributions upon or with respect to the
Subordinated Debt which are received by or on behalf of the
Subordinated Creditor contrary to the provisions of this Agreement
shall be received in trust for the benefit of the Administrative Agent,
for itself and for the ratable benefit of the Banks, shall be
segregated from other funds and property held by the Subordinated
Creditor and shall be forthwith paid over to the Administrative Agent
in the same form as so received (with any necessary indorsement) to be
applied (in the case of cash) to, or held as collateral (in the case of
non-cash property or securities) for, the payment or
General Communication, Inc. - Form 8-K
Page 413
prepayment of the Obligations in accordance with the terms of the Loan
Agreement and the Notes.
(c) The Administrative Agent is hereby authorized to demand
specific performance of this Agreement, whether or not the Borrower
shall have complied with any of the provisions hereof applicable to it,
at any time when the Subordinated Creditor shall have failed to comply
with any of the provisions of this Agreement applicable to it. The
Subordinated Creditor hereby irrevocably waives any defense based on
the adequacy of a remedy at law, which might be asserted as a bar to
such remedy of specific performance.
(d) The Subordinated Debt shall be unsecured Indebtedness.
SECTION 4. Subordinated Creditor's Commencement of
Proceedings. The Subordinated Creditor agrees that, so long as the Commitment
shall not have been terminated and the Obligations shall not have been paid in
full in cash, the Subordinated Creditor will not take, sue for, ask or demand
from the Borrower payment of all or any of the Subordinated Debt, or commence,
or join with any creditor other than the Administrative Agent in commencing,
directly or indirectly to cause the Borrower to commence, or assist the Borrower
in commencing, any proceeding referred to in Section 2(a) or initiate any
judicial action to seek to enforce collection of the Subordinated Debt.
SECTION 5. Rights of Subrogation. The Subordinated Creditor
agrees that no payment or distribution to the Administrative Agent pursuant to
the provisions of this Agreement shall entitle the Subordinated Creditor to
exercise any right of subrogation in respect thereof until the Obligations shall
have been paid in full and the Commitment terminated.
SECTION 6. Subordination Legend; Further Assurances. The
Subordinated Creditor and the Borrower will cause each instrument evidencing
Subordinated Debt to be endorsed with the following legend:
"The indebtedness evidenced by this instrument is subordinated
to the prior payment in full of the Obligations (as defined in the
Subordination Agreement hereinafter referred to) pursuant to, and to
the extent provided in, the Subordination Agreement dated October 31,
1996 by the maker hereof and payee named herein in favor of Toronto
Dominion (Texas), Inc., as administrative agent and its successors and
assigns."
The Subordinated Creditor and the Borrower each will further mark its books of
account in such a manner as shall be effective to give proper notice of the
effect of this Agreement and will, in the case of any Subordinated Debt which is
not evidenced by any instrument, upon the Administrative Agent's request cause
such Subordinated Debt to be evidenced by an appropriate instrument or
instruments endorsed with the above legend. The Subordinated
General Communication, Inc. - Form 8-K
Page 414
Creditor and the Borrower each will, at its expense and at any time and from
time to time, promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary or desirable, or
that the Administrative Agent may reasonably request, in order to protect any
right or interest granted or purported to be granted hereby or to enable the
Administrative Agent, for itself and for the ratable benefit of the Banks, to
exercise and enforce its rights and remedies hereunder.
SECTION 7. Agreements in Respect of Subordinated Debt.
(a) The Subordinated Creditor will not, without the
Administrative Agent's prior written consent:
(i) Convert or exchange any of the Subordinated Debt
into or for any other indebtedness or subordinate any of the
Subordinated Debt to any indebtedness of the Borrower other
than the Obligations;
(ii) Sell, assign, pledge, encumber or otherwise
dispose of any of the Subordinated Debt unless such sale,
assignment, pledge, encumbrance or disposition is made
expressly subject to this Agreement;
(iii) Permit the terms of any of the Subordinated
Debt to be amended or changed in any manner which adversely
affects the interests of the Administrative Agent and the
Banks hereunder; or
(iv) Accept or receive any payment of principal of,
or interest or other amounts owing on, the Subordinated Debt.
(b) The Subordinated Creditor shall promptly notify the
Administrative Agent of the occurrence of any default under its loan agreement
with the Borrower.
SECTION 8. Agreement by the Borrower. The Borrower agrees that
it will not make any payment of any of the Subordinated Debt or take any other
action, in contravention of the provisions of this Agreement.
SECTION 9. Obligations Hereunder Not Affected. All rights and
interests of the Administrative Agent for itself and for the ratable benefit of
the Banks hereunder, and all agreements and obligations of the Subordinated
Creditor and the Borrower under this Agreement, shall remain in full force and
effect irrespective of:
(i) any lack of validity or enforceability of the Loan Agreement or
any Note or any other agreement or instrument relating thereto;
(ii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent
General Communication, Inc. - Form 8-K
Page 415
to any departure from the Loan Agreement or any Note, including,
without limitation, any increase in the Obligations resulting from the
extension of additional credit to the Borrower or otherwise;
(iii) any taking, exchange, or release of or non-perfection of any
security interest on, any collateral, or any taking, release or
amendment or waiver of or consent to departure from any guaranty, for
all or any of the Obligations;
(iv) any manner of application of collateral, or proceeds thereof,
to all or any of the Obligations, or any manner of sale or other
disposition of any collateral for all or any of the Obligations or any
other assets of the Borrower;
(v) any change, restructuring or termination of the corporate
structure or existence of the Borrower; or
(vi) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Borrower or a subordinated
creditor.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Obligations is rescinded or must
otherwise be returned by the Administrative Agent upon the insolvency,
bankruptcy or reorganization of the Borrower or otherwise, all as though such
payment had not been made.
SECTION 10. Waiver. The Subordinated Creditor and the Borrower
each hereby waives promptness, diligence, notice of acceptance and any other
notice (except for notice expressly required under this Agreement or under any
of the Loan Documents) with respect to any of the Obligations and this Agreement
and any requirement that the Administrative Agent protect, secure, perfect or
insure any security interest or lien or any property subject thereto or exhaust
any right or take any action against the Borrower or any other person or entity
or any collateral.
SECTION 11. Representations and Warranties.
(a) The Borrower hereby represents and warrants to the
Subordinated Creditor and the Administrative Agent that all instruments
evidencing the Subordinated Debt shall be duly authorized, issued and
copies shall be delivered to the Administrative Agent simultaneously
with the incurrence of the Subordinated Debt, and shall constitute a
legal, valid and binding obligation of the Borrower enforceable against
the Borrower in accordance with their respective terms. There exists no
default in respect of any such Subordinated Debt.
(b) The Subordinated Creditor hereby represents and warrants
to the Administrative Agent as follows:
General Communication, Inc. - Form 8-K
Page 416
(i) The Subordinated Creditor shall be the legal and
beneficial owner of the Subordinated Debt free and clear of
any Lien, security interest, option or other charge or
encumbrance.
(ii) There are no conditions precedent to the
effectiveness of the Subordinated Creditor's obligations under
this Agreement, which conditions have not been satisfied or
waived.
(iii) The Subordinated Creditor has, independently
and without reliance upon the Administrative Agent and based
on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to
enter into this Agreement.
SECTION 12. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, and no consent to any departure by the
Administrative Agent, the Subordinated Creditor or the Borrower herefrom, shall
in any event be effective unless the same shall be in writing and signed by all
parties hereto, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 13. Expenses. The Borrower agrees upon demand to pay
to the Administrative Agent the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its counsel and of any experts or
agents, which the Administrative Agent may incur in connection with the (i) the
administration of this Agreement, (ii) the exercise or enforcement of any of the
rights of the Administrative Agent, for itself and the Banks, hereunder or (iii)
the failure by the Borrower to perform or observe any of the provisions hereof.
In addition, the Subordinated Creditor agrees upon demand to pay to the
Administrative Agent the amount of any and all reasonable expenses, including
the reasonable fees and expenses of its counsel and of any experts or agents,
which the Administrative Agent may incur in connection with the failure by the
Subordinated Creditor to perform or observe any of the provisions hereof.
SECTION 14. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including telecopier,
telegraphic, telex or cable communication) and mailed, telecopied, telegraphed,
telexed, cabled or delivered to it, if to the Subordinated Creditor, to it at
2550 Denali Street, Suite 1000, Anchorage, Alaska 99503 and if to the Borrower
or the Administrative Agent, at its address specified in the Loan Agreement, or
as to each party, at such other address as shall be designated by such party in
a written notice to each other party. All such notices and other communications
shall, when mailed, telecopied, telegraphed, telexed or cabled, be effective
when deposited in the mails, telecopied, delivered to the telegraph company,
confirmed by telex answerback or delivered to the cable company, respectively.
SECTION 15. No Waiver; Remedies. No failure on the part of the
Administrative Agent to exercise, and no delay in exercising, any right
hereunder shall
General Communication, Inc. - Form 8-K
Page 417
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 16. Continuing Agreement; Assignments. This Agreement
is a continuing agreement and shall (i) remain in full force and effect until
the indefeasible payment in full in cash of the Obligations and the termination
of the Commitment(after which time this Agreement shall be of no further force
or effect), (ii) be binding upon the Subordinated Creditor, the Borrower and
their respective successors, and (iii) be binding upon, inure to the benefit of,
and be enforceable by, the Administrative Agent, the Subordinated Creditor, and
their successors, transferees and assigns. Without limiting the generality of
the foregoing clause (iii), the Administrative Agent may, as provided in the
Loan Agreement, assign or otherwise transfer all or any portion of its rights
and obligations under the Loan Agreement and any Note (including, without
limitation, all or any portion of its Loans) to any other Person, and such other
Person shall thereupon become vested with all the rights in respect thereof
granted to the Administrative Agent herein or otherwise. The Borrower shall not
assign its obligations hereunder without the prior written consent of the
Administrative Agent.
SECTION 17. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York,
excluding its principles of conflicts of laws.
SECTION 18. Borrower's Obligations Unconditional. The
provisions of this Agreement are for the purpose of defining the relative rights
of the Administrative Agent, the Subordinated Creditor and the Borrower. Nothing
herein shall impair, as between the Borrower and the Subordinated Creditor, the
obligation of the Borrower, which is unconditional and absolute, to pay to the
Subordinated Creditor the full amount of the principal, premium (if any) and
interest on the Subordinated Debt in accordance with the terms thereof, and to
comply with all of its covenants and agreements with respect thereto subject
only to the Administrative Agent's rights herein; nor shall anything herein
prevent the Subordinated Creditor (except as expressly otherwise provided in
this Agreement) from exercising all remedies otherwise permitted by Applicable
Law or hereunder upon default under its loan agreement with the Borrower,
subject to the rights of the Administrative Agent set forth in this Agreement.
SECTION 19. Termination of Agreement. Upon the indefeasible
payment and satisfaction in full in cash of all of the Obligations and the
termination of the Commitment, this Agreement shall automatically terminate
without any additional action by any party hereto.
General Communication, Inc. - Form 8-K
Page 418
SECTION 20. Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed to be an original and all
of which, when taken together, shall constitute one in the same instrument.
[the rest of this page is intentionally blank]
General Communication, Inc. - Form 8-K
Page 419
IN WITNESS WHEREOF, the Subordinated Creditor, the Borrower
and the Administrative Agent each have caused this Agreement to be duly executed
and delivered by its officer or partner thereunto duly authorized as of the date
first above written.
SUBORDINATED
CREDITOR: GENERAL COMMUNICATION, INC.
By: /s/ John M. Lowber
Title: Senior Vice President
BORROWER: GCI CABLE, INC.
By: /s/ John M. Lowber
Title: Secretary/Treasurer
ADMINISTRATIVE AGENT: TORONTO DOMINION (TEXAS), INC.
By /s/ Jano Mott
Title: Vice President
General Communication, Inc. - Form 8-K
Page 420