EXECUTION COPY
$750,000,000.00
THIRD AMENDED AND RESTATED FACILITY A LOAN AGREEMENT
FOR
LONG-TERM REVOLVING CREDIT FACILITY
AMONG VANGUARD CELLULAR FINANCIAL CORP. (THE "BORROWER");
THE FINANCIAL INSTITUTIONS PARTY HERETO AS LENDERS (THE "LENDERS");
THE BANK OF NEW YORK AND THE TORONTO-DOMINION BANK AS CO-
ADMINISTRATIVE AGENTS (THE "CO-ADMINISTRATIVE AGENTS");
THE BANK OF NEW YORK AS FUNDING AGENT (THE "FUNDING AGENT");
THE TORONTO-DOMINION BANK AS DOCUMENTATION/REVIEW AGENT
(THE "DOCUMENTATION AGENT");
NATIONSBANK OF TEXAS, N.A. AS SYNDICATION AGENT (THE "SYNDICATION
AGENT")
AND TORONTO DOMINION (TEXAS), INC.
AS COLLATERAL AGENT (THE "COLLATERAL AGENT")
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS.................................................................................2
Section 1.1 Defined Terms...............................................................................2
Section 1.2 Interpretation.............................................................................21
Section 1.3 Cross Reference............................................................................22
ARTICLE 2 LOANS AND LETTERS OF CREDIT................................................................22
Section 2.1 The Loans and Letters of Credit............................................................22
Section 2.2 Manner of Borrowing and Disbursement.......................................................22
Section 2.3 Interest ..................................................................................25
Section 2.4 Scheduled Commitment Reductions............................................................26
Section 2.5 Fees ......................................................................................27
Section 2.6 Optional Prepayments; Facility A Commitment Reduction......................................29
Section 2.7 Mandatory Prepayments......................................................................30
Section 2.8 Notes; Loan Accounts.......................................................................30
Section 2.9 Manner of Payment..........................................................................30
Section 2.10 Reimbursement..............................................................................31
Section 2.11 Pro Rata Treatment.........................................................................32
Section 2.12 Capital Adequacy...........................................................................32
Section 2.13 Lender Tax Forms...........................................................................33
Section 2.14 Letters of Credit..........................................................................33
Section 2.15 Swing Line Loans...........................................................................39
ARTICLE 3 CONDITIONS PRECEDENT.......................................................................41
Section 3.1 Conditions Precedent to Effectiveness......................................................41
Section 3.2 Conditions Precedent to Each Advance.......................................................44
Section 3.3 Conditions Precedent to Issuance of Letters of Credit......................................44
ARTICLE 4 REPRESENTATIONS AND WARRANTIES.............................................................45
Section 4.1 Representations and Warranties.............................................................45
Section 4.2 Survival of Representations and Warranties, etc............................................51
ARTICLE 5 GENERAL COVENANTS..........................................................................51
Section 5.1 Preservation of Existence and Similar Matters..............................................51
Section 5.2 Business Compliance with Applicable Law....................................................51
Section 5.3 Maintenance of Properties..................................................................51
Section 5.4 Accounting Methods and Financial Records...................................................52
Section 5.5 Insurance..................................................................................52
Section 5.6 Payment of Taxes and Claims................................................................52
Section 5.7 Visits and Inspections.....................................................................53
Section 5.8 Payment of Indebtedness; Loans.............................................................53
Section 5.9 Use of Proceeds............................................................................53
Section 5.10 Payment of Wages...........................................................................53
Section 5.11 Indemnity..................................................................................53
Section 5.12 Interest Rate Hedging......................................................................54
ARTICLE 6 INFORMATION COVENANTS......................................................................54
Section 6.1 Quarterly Financial Statements and Information.............................................54
Section 6.2 Annual Financial Statements and Information................................................55
Section 6.3 Performance Certificates...................................................................55
Section 6.4 Copies of Other Reports....................................................................56
Section 6.5 Notice of Litigation and Other Matters.....................................................56
ARTICLE 7 NEGATIVE COVENANTS.........................................................................58
Section 7.1 Indebtedness of the Borrower and its Subsidiaries..........................................58
Section 7.2 Limitation on Liens........................................................................59
Section 7.3 Amendment and Waiver.......................................................................59
Section 7.4 Liquidation, Merger, or Disposition of Assets..............................................60
Section 7.5 Limitation on Guaranties...................................................................61
Section 7.6 Investments and Acquisitions...............................................................61
Section 7.7 Restricted Payments and Purchases..........................................................62
Section 7.8 Interest Coverage Ratio....................................................................62
Section 7.9 Fixed Charge Ratio.........................................................................63
Section 7.10 Leverage Ratio.............................................................................63
Section 7.11 Pro Forma Debt Service Ratio...............................................................63
Section 7.12 Affiliate Transactions.....................................................................63
Section 7.13 Real Estate................................................................................63
Section 7.14 ERISA Liabilities..........................................................................64
Section 7.15 Unrestricted Subsidiaries..................................................................64
Section 7.16 The VCS Subsidiary.........................................................................64
Section 7.17 Limitation on Upstream Dividends by Subsidiaries...........................................65
ARTICLE 8 DEFAULT....................................................................................65
Section 8.1 Events of Default..........................................................................65
Section 8.2 Remedies ..................................................................................68
Section 8.3 Payments Subsequent to Declaration of Event of Default.....................................70
ARTICLE 9 THE AGENTS.................................................................................71
Section 9.1 Appointment and Authorization..............................................................71
Section 9.2 Interest Holders...........................................................................71
Section 9.3 Consultation with Counsel..................................................................71
Section 9.4 Documents..................................................................................71
Section 9.4 Agents and Affiliates......................................................................72
Section 9.6 Responsibility of the Co-Administrative Agents, the Funding Agent, the
Documentation Agent, the Syndication Agent and the Collateral Agent........................72
Section 9.7 Collateral Agent...........................................................................72
Section 9.8 Action by Co-Administrative Agents, the Funding Agent, the Documentation Agent, the
Syndication Agent and the Collateral Agent.................................................72
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Section 9.9 Notice of Default..........................................................................73
Section 9.10 Responsibility Disclaimed..................................................................73
Section 9.11 Indemnification............................................................................74
Section 9.12 Credit Decision............................................................................74
Section 9.13 Successor Funding Agent, Documentation Agent, Co-Administrative Agent, Syndication
Agent and Collateral Agent.................................................................74
Section 9.14 Delegation of Duties.......................................................................75
ARTICLE 10 CHANGE IN CIRCUMSTANCES AFFECTING EURODOLLAR ADVANCES......................................76
Section 10.1 Eurodollar Basis Determination Inadequate..................................................76
Section 10.2 Illegality.................................................................................76
Section 10.3 Increased Costs............................................................................76
Section 10.4 Effect on Other Advances...................................................................78
Section 10.5 Claims for Increased Costs and Taxes.......................................................78
ARTICLE 11 MISCELLANEOUS..............................................................................78
Section 11.1 Notices....................................................................................78
Section 11.2 Expenses...................................................................................80
Section 11.3 Waivers....................................................................................81
Section 11.4 Set-Off....................................................................................81
Section 11.5 Assignment.................................................................................82
Section 11.6 Accounting Principles......................................................................83
Section 11.7 Counterparts...............................................................................83
Section 11.8 Governing Law..............................................................................83
Section 11.9 Severability...............................................................................84
Section 11.10 Interest...................................................................................84
Section 11.11 Table of Contents and Headings.............................................................84
Section 11.12 Amendment and Waiver.......................................................................84
Section 11.13 Entire Agreement...........................................................................85
Section 11.14 Other Relationships........................................................................85
Section 11.15 Directly or Indirectly.....................................................................86
Section 11.16 Reliance on and Survival of Various Provisions.............................................86
Section 11.17 Senior Debt................................................................................86
Section 11.18 Obligations Several........................................................................86
Section 11.19 Confidentiality............................................................................86
ARTICLE 12 WAIVER OF JURY TRIAL.......................................................................87
Section 12.1 Waiver of Jury Trial.......................................................................87
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EXHIBITS
Exhibit A - Form of Borrower Pledge Agreement
Exhibit B - Form of Certificate of Financial Condition
Exhibit C-1 - Form of Facility A Note
Exhibit C-2 - Form of Swing Line Note
Exhibit D - Form of Request for Advance
Exhibit E - Form of VCOC Guaranty
Exhibit F - Form of Vanguard Guaranty
Exhibit G - Form of Vanguard Pledge Agreement
Exhibit H-1 - Form of Borrower's Loan Certificate
Exhibit H-2 - Form of Subsidiary Loan Certificate
Exhibit H-3 - Form of Vanguard Loan Certificate
Exhibit I - Form of Performance Certificate
Exhibit J - Form of Assignment and Assumption Agreement
Exhibit K - Form of Request for Issuance of Letter of Credit
Exhibit L - Form of Request for Swing Line Advance
SCHEDULES
Schedule 1 - Commitment Ratios
Schedule 2 - Licenses
Schedule 3 - Liens of Record as of the Agreement Date
Schedule 4 - Subsidiaries
Schedule 5 - Litigation
Schedule 6 - Agreements with Affiliates
Schedule 7 - Investments
THIRD AMENDED AND RESTATED LOAN AGREEMENT
This Third Amended and Restated Loan Agreement (the "Agreement"), made as
of this 20th day of February, 1998, by and among VANGUARD CELLULAR FINANCIAL
CORP., a North Carolina corporation (the "Borrower"), the financial institutions
party hereto as Lenders (together with such other financial institutions as may
hereafter become Lenders hereunder, the "Lenders"), THE BANK OF NEW YORK and THE
TORONTO DOMINION BANK, as Co-Administrative Agents (the "Co-Administrative
Agents"), THE BANK OF NEW YORK, as Funding Agent (the "Funding Agent"), THE
TORONTO DOMINION BANK, as Documentation/Review Agent (the "Documentation
Agent"), NATIONSBANK OF TEXAS, N.A., as Syndication Agent (the "Syndication
Agent") and TORONTO DOMINION (TEXAS), INC., as Collateral Agent (the "Collateral
Agent").
WITNESSETH:
WHEREAS, the Borrower (as successor by assignment to Vanguard Cellular
Operating Corp.), certain of the Lenders, the Co-Administrative Agents, the
Funding Agent and the Collateral Agent are parties to a Second Amended and
Restated Loan Agreement dated as of April 10, 1996, as amended by the First
Amendment thereto dated as of July 31, 1996, the Second Amendment thereto dated
as of October 9, 1996, the Third Amendment thereto dated as of March 31, 1997
and the Fourth Amendment thereto dated as of September 10, 1997 (collectively,
the "Prior Loan Agreement"); and
WHEREAS, the Co-Administrative Agents, the Funding Agent, the Lenders and
the Collateral Agent have agreed to amend and restate the Prior Loan Agreement
in its entirety as set forth herein; and
WHEREAS, the Borrower acknowledges and agrees that: (a) the Obligations (as
defined herein) represent, among other things, the amendment, restatement,
renewal, extension, consolidation and modification of the Obligations (as
defined in the Prior Loan Agreement) arising in connection with the Prior Loan
Agreement and the other Loan Documents (as defined in the Prior Loan Agreement);
and (b) the Loan Documents (as defined herein) are intended to restructure,
restate, renew, extend, consolidate, amend and modify the Prior Loan Agreement
and the other Loan Documents (as defined in the Prior Loan Agreement); and
WHEREAS, the parties hereto intend that (a) the provisions of the Prior
Loan Agreement and the other Loan Documents (as defined in the Prior Loan
Agreement), as restructured, restated, renewed, extended, consolidated, amended
and modified hereby, are hereby superseded and replaced by the provisions hereof
and of the other Loan Documents (as defined herein); and (b) the Notes (as
hereinafter defined) amend, renew, extend, modify, replace, are substituted for
and supersede in their entirety, but do not extinguish the indebtedness arising
under, the promissory notes issued pursuant to the Prior Loan Agreement nor are
they intended to create or constitute a novation;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
ARTICLE 1
Definitions
Section 1.1 Defined Terms. The following terms when used in this Agreement
shall have the following meanings:
"Acquisition" shall mean (whether by purchase, exchange, issuance of stock
or other equity or debt securities, merger, reorganization or any other method)
(a) any acquisition by the Borrower or any of its Subsidiaries of any other
Person, which Person shall then become consolidated with the Borrower or any
such Subsidiary in accordance with GAAP, or (b) any acquisition by the Borrower
or any of its Subsidiaries of all or any substantial part of the assets of any
other Person.
"Advance" or "Advances" shall mean amounts advanced by the Lenders and the
Swing Line Lender to the Borrower pursuant to Article 2 hereof on the occasion
of any borrowing.
"Affiliate" shall mean, with respect to a Person, (a) any other Person
directly or indirectly controlling, controlled by, or under common control with,
such first Person or (b) any other Person who is a director or executive officer
(i) of such specified Person, (ii) of any Subsidiary of such specified Person or
(iii) of any Person described in clause (a) above. For the purposes of this
definition, "control" when used with respect to any Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing. "Affiliate" shall also mean any beneficial owner of shares
representing ten percent (10%) or more of the total voting power of the Voting
Stock (on a fully diluted basis) of the Company or of rights or warrants to
purchase such Voting Stock (whether or not currently exercisable) and any Person
who would be an Affiliate of any such beneficial owner pursuant to the first
sentence hereof. Unless otherwise specified, "Affiliate" shall mean an Affiliate
of the Borrower.
"Agents" shall mean, collectively, the Co-Administrative Agents, the
Funding Agent, the Documentation Agent, the Syndication Agent and the Collateral
Agent.
"Agreement" shall mean this Agreement, as amended, supplemented or
otherwise modified from time to time.
"Agreement Date" shall mean the date as of which this Agreement is dated.
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"Annualized Cash Flow" shall mean, as of any calculation date, the product
of (a) the sum of Cash Flow for the most recently completed two (2) fiscal
quarters, multiplied by (b) two (2). For purposes of measuring the Fixed Charge
Ratio pursuant to Section 7.9 hereof, for purposes of measuring the Leverage
Ratio pursuant to Section 7.10 hereof and for purposes of measuring the Pro
Forma Debt Service Ratio pursuant to Section 7.11 hereof, Annualized Cash Flow
shall be further adjusted to give effect to any Acquisition, Investment or
disposition of assets by the Borrower or any of its Subsidiaries permitted
hereunder for the calculation period during which such transaction occurs, as if
such Acquisition, Investment or disposition of assets had been consummated on
the first day of such calculation period, and assuming that the Cash Flow
allocated to the Borrower or the applicable Subsidiary with respect to any such
Acquisition or Investment was equal to the cash flow of the seller (calculated
in the same manner as Cash Flow hereunder) generated by such Acquisition or
Investment for the portion of such period preceding the Borrower's operation
thereof. For purposes of this definition, "calculation period" shall mean the
period consisting of the two (2) most recently completed fiscal quarters.
"Applicable Law" shall mean, in respect of any Person, all provisions of
constitutions, statutes, rules, regulations and orders of governmental bodies or
regulatory agencies applicable to such Person, including, without limiting the
foregoing, the Licenses, the Communications Act and all Environmental Laws and
all orders, decisions, judgments and decrees of all courts and arbitrators in
proceedings or actions to which the Person in question is a party or by which it
is bound.
"Applicable Margin" shall mean the interest rate margin applicable to
Advances hereunder determined in accordance with Section 2.3(f) hereof.
"Authorized Signatory" shall mean such senior personnel of the Borrower or
any of its Subsidiaries, as applicable, as may be duly authorized and designated
in writing by the Borrower or any such Subsidiary, as applicable, to execute
documents, agreements and instruments on behalf of the Borrower or such
Subsidiary, as applicable.
"Available Facility A Commitment" shall mean, as of any particular time,
(a) the Facility A Commitment, minus (b) the sum of (i) the Facility A Loans
then outstanding, plus (ii) the Swing Line Loans then outstanding, plus (iii)
the aggregate amount of all Letter of Credit Obligations then outstanding.
"Available Letter of Credit Commitment" shall mean, at any time, the lesser
of (a) (i) $25,000,000.00, minus (ii) all Letter of Credit Obligations then
outstanding, and (b) the Available Facility A Commitment.
"Available Swing Line Commitment" shall mean, at any time, the lesser of
(a) (i) the Swing Line Commitment, minus (ii) Swing Line Advances then
outstanding, and (b) the Available Facility A Commitment.
"Board of Directors" shall mean, in respect of any Person which is a
corporation, the Board of Directors of such Person.
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"Borrower" shall mean Vanguard Cellular Financial Corp., a North Carolina
corporation.
"Borrower Pledge Agreement" shall mean that certain Borrower Pledge
Agreement of even date herewith between the Borrower and the Collateral Agent,
substantially in the form of Exhibit A attached hereto, pursuant to which the
Borrower pledges to the Collateral Agent the stock of VCOC.
"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 and New York, New York, as relevant to the determination to be made or
the action to be taken.
"CPAC" shall mean Cellular Phone Assurance Company, Ltd., a Bermuda
corporation and Wholly-Owned Subsidiary of the Borrower which provides, through
a third party U.S. insurer, to the Borrower's and its other Subsidiaries'
wireless communications customers property insurance insuring the replacement
cost of, and service warranties for, such customers' cellular telephones, pagers
and other wireless communications equipment.
"Capital Expenditures" shall mean, in respect of any Person, expenditures
for the purchase of assets of long-term use which should be capitalized in
accordance with GAAP.
"Capital Stock" shall mean, with respect to any Person, any and all shares
or other equivalents (however designated) of corporate stock, partnership
interests or any other participation, right, warrant, option or other interest
in the nature of an equity interest in such Person, but excluding any debt
security convertible or exchangeable into such equity interest.
"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.
"Cash Flow" shall mean, for the Borrower and its Subsidiaries on a
consolidated basis for any fiscal period, Net Income for such period (after
eliminating any extraordinary gains and losses, including, without limitation,
gains and losses from the sale of assets, and minority interests and equity in
earnings (losses) of non-consolidated entities), plus, to the extent deducted in
determining Net Income, the sum of each of the following for such period: (a)
depreciation and amortization allowances, (b) interest expense, (c) income tax
expense, including, without limitation, reserves for deferred taxes not payable
currently, and (d) all other non-cash items.
"Cellular System" shall mean a cellular mobile radio telephone system
constructed and operated in an MSA or an RSA.
"Certificate of Financial Condition" shall mean a certificate,
substantially in the form of Exhibit B attached hereto, signed by the chief
financial officer of the Borrower, together with any schedules, exhibits or
annexes appended thereto.
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"Change of Control" shall mean the occurrence of any of the following
events:
(a) Any "person" or "group" (within the meaning of Sections 13(d)(3)
and 14(d)(2) of the Exchange Act or any successor provision to either of
the foregoing, including any group acting for the purpose of acquiring,
holding or disposing of securities within the meaning of Rule 13d-5(b)(1)
under the Exchange Act) other than one (1) or more of the Permitted Holders
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of forty percent (40%) or more of
the total voting power of the Voting Stock (on a fully-diluted basis) of
Vanguard;
(b) During any period of two (2) consecutive years, individuals who at
the beginning of such period constituted the Board of Directors of Vanguard
(together with any new directors whose election by the Board of Directors
of Vanguard or whose nomination for election by the shareholders of
Vanguard was approved by a vote of sixty-six and two-thirds percent (66
2/3%) of the directors of Vanguard then still in office who were either
directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute
a majority of the Board of Directors of Vanguard then in office;
(c) Vanguard consolidates or merges with or into any other Person
(other than one or more Permitted Holders) or any other Person (other than
one or more Permitted Holders) consolidates or merges with or into
Vanguard, in either case, other than a consolidation or merger (i) with a
Wholly Owned Subsidiary in which all of the Voting Stock of Vanguard
outstanding immediately prior to the effectiveness thereof is changed into
or exchanged for substantially the same consideration or (ii) pursuant to a
transaction in which the outstanding Voting Stock of Vanguard is changed
into or exchanged for cash, securities or other property with the effect
that the "beneficial owners" (as defined in Rule 13d-3 under the Exchange
Act) of the outstanding Voting Stock immediately prior to such transaction,
beneficially own, directly or indirectly, more than fifty percent (50%) of
the total voting power of the fully diluted Voting Stock of the surviving
corporation immediately following such transaction in substantially the
same proportions as owned prior to such transaction;
(d) Vanguard sells, conveys, transfers or leases, directly or
indirectly, all or substantially all of its assets (other than to a Wholly
Owned Subsidiary or one (1) or more Permitted Holders); or
(e) Vanguard shall cease to be the sole shareholder (directly or
indirectly) of the Borrower.
"Co-Administrative Agents" shall mean The Bank of New York ("BNY") and The
Toronto-Dominion Bank ("TD"), acting in their capacities as Co-Administrative
Agents for the Lenders.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
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"Collateral" shall mean any property of any kind constituting collateral
for the Obligations under any of the Security Documents.
"Collateral Agent" shall mean Toronto Dominion (Texas), Inc., as collateral
agent for the Agents and the Lenders.
"Commitment Ratios" shall mean the percentages in which the Lenders are
severally bound to make Advances to the Borrower under the Facility A
Commitment, which as of the Agreement Date are set forth on Schedule 1 attached
hereto (together with dollar amounts).
"Communications Act" shall mean the Communications Act of 1934 and any
similar or successor federal statute and the rules and regulations of the FCC
thereunder, all as the same may be in effect from time to time.
"Debt Service" shall mean, for any period, the amount of all principal paid
and GAAP Interest Expense of the Borrower and its Subsidiaries on a consolidated
basis in respect of Indebtedness for Money Borrowed (other than voluntary
principal payments under the Facility A Loans which are not required to be
accompanied by an identical reduction in the Facility A Commitment).
"Default" shall mean any Event of Default and 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 the sum
of the otherwise applicable Interest Rate Basis, plus two percent (2%), or if no
Interest Rate Basis is otherwise applicable, a simple per annum interest rate
equal to the sum of the Prime Rate Basis, plus two percent (2%).
"Documentation Agent" shall mean The Toronto-Dominion Bank, in its capacity
as Documentation/Review Agent.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
in effect from time to time.
"ERISA Affiliate" shall mean any Person, including a Subsidiary or an
Affiliate of the Borrower, that is a member of any group of organizations
(within the meaning of Code Section 414, clause (b), (c), (m) or (o)) of which
the Borrower is a member.
"Environmental Laws" shall mean all applicable federal, state or local
laws, statutes, rules, regulations or ordinances, codes, common law, consent
agreements, orders, decrees, judgments or injunctions issued, promulgated,
approved or entered thereunder relating to public health, safety or the
pollution or protection of the environment, including, without limitation, those
relating to releases, discharges, emissions, spills, leaching or disposals to
air, water, land or ground water, to the withdrawal or use of ground water, to
the use, handling or disposal of
6
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, or to exposure to toxic, hazardous or
other controlled, prohibited, or regulated substances, including, without
limitation, any such provisions under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, (42 U.S.C. ss. 9601 et seq.), as amended
by the Superfund Amendments and Reauthorization Act of 1986, as amended, or the
Solid Waste Disposal Act, as amended (42 U.S.C. ss. 6901 et seq.).
"Equivalent Owned POPS" shall mean, for each MSA or RSA served by any
Cellular System which is owned in whole or in part, directly or indirectly, by
the Borrower or any of its Subsidiaries, a number equal to the product of (a)
the number of POPs for each such MSA or RSA and (b) the percentage of ownership
of the Borrower (either directly or through its Subsidiaries) in the Cellular
System serving each such MSA or RSA.
"Eurodollar Advance" shall mean an Advance which the Borrower requests to
be made as a Eurodollar Advance or which is reborrowed as a Eurodollar Advance,
in accordance with the provisions of Section 2.2 hereof, which bears interest at
the Eurodollar Basis and which shall be in a principal amount of at least
$5,000,000.00 and in an integral multiple of $ 1,000,000.00.
"Eurodollar Basis" shall mean a simple per annum interest rate (rounded
upward, if necessary, to the nearest one-hundredth of one percent (0.01%)) equal
to the sum of (a) the quotient of (i) the Eurodollar Rate divided by (ii) one
(1), minus the Eurodollar Reserve Percentage, stated as a decimal, plus (b) the
Applicable Margin as determined by Section 2.3(f) hereof. The Eurodollar Basis
shall apply to Interest Periods of one (1), two (2), three (3), six (6) and,
subject to availability, nine (9) and twelve (12) months and, once determined,
shall remain unchanged during the applicable Interest Period, except for changes
to reflect adjustments in the Eurodollar Reserve Percentage and the Applicable
Margin. The Borrower may elect an Interest Period of nine (9) or twelve (12)
months for a Eurodollar Advance unless the Funding Agent has been notified by
one (1) or more Lenders that such Lender does not have available to it funds for
its portion of the proposed Advance which are not required for other purposes,
that such funds are not available to such Lender at a rate at or below the
Eurodollar Rate for such proposed Advance and Interest Period, or that such
Lender does not agree (in its sole discretion) to fund its portion of such
Advance.
"Eurodollar Rate" shall mean, for any Interest Period, the average of the
interest rates per annum at which deposits in United States Dollars for such
Interest Period are offered to the Co-Administrative Agents in the Eurodollar
market at approximately 11:00 a.m. (New York, 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
7
with respect to Eurocurrency Liabilities (as that term is defined in Regulation
D), whether or not any Lender has any such Eurocurrency Liabilities subject to
such reserve requirement at that time. The Eurodollar Basis for any Eurodollar
Advance shall be adjusted as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Event of Default" shall mean any of the events specified in Section 8.1
hereof, provided that any requirement for notice or lapse of time has been
satisfied.
"Excess Cash Flow" shall mean, with respect to the Borrower and its
Subsidiaries on a consolidated basis, as of the end of any fiscal year of the
Borrower based on the audited financial statements required to be provided to
the Lenders under Section 6.2 hereof for such year, the remainder of (a) the sum
of (i) Cash Flow for such fiscal year, plus (ii) the amount of all cash payments
of capital contributions made during such year by minority investors in Cellular
Systems majority-owned by the Borrower or any of its Subsidiaries, minus (b) the
sum of the following items for such fiscal year: (i) Debt Service; (ii) Capital
Expenditures; (iii) income taxes paid; (iv) cash payments of capital
contributions made by the Borrower and its Subsidiaries to any Person which is
an Investment in a Cellular System permitted hereunder; and (v) Restricted
Payments made pursuant to Section 7.7(c) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"FCC" shall mean the Federal Communications Commission, or any other
similar or successor agency of the federal government administering the
Communications Act.
"Facility A Commitment" shall mean the several obligations of the Lenders
to advance the sum of up to $750,000,000.00 at any one time outstanding, in
accordance with their respective Commitment Ratios, to the Borrower pursuant to
the terms hereof, as such obligations may be reduced from time to time pursuant
to the terms hereof.
"Facility A Loans" shall mean, collectively, the amounts advanced by the
Lenders to the Borrower under the Facility A Commitment, not to exceed the
amount of the Facility A Commitment, and evidenced by the Facility A Notes.
"Facility A Maturity Date" shall mean December 31, 2005, or such earlier
date as payment of the remaining outstanding principal amount of the Facility A
Loans or of all remaining outstanding Obligations shall be due and the Facility
A Commitment shall be terminated (whether by acceleration or otherwise).
"Facility A Net Proceeds" shall mean, with respect to any applicable
transaction, the product of (a) the Net Proceeds of such transaction, times (b)
the ratio of (i) the Facility A Commitment outstanding (or, the sum of the
Facility A Loans, the Swing Line Loans and the Letter of Credit Obligations if
there is no Facility A Commitment then outstanding) then outstanding on such
date to (ii) the sum of (A) the Facility A Commitment (or, the sum of the
Facility A Loans, the Swing Line Loans and the Letter of Credit Obligations if
there is no Facility A Commitment then outstanding) then outstanding on such
date, plus (B) the Facility B
8
Commitment then outstanding (or, the Facility B Loans if there is no Facility B
Commitment then outstanding) on such date.
"Facility A Notes" shall mean those certain amended and restated reducing,
revolving promissory notes in the aggregate original principal amount of the
Facility A Commitment, one (1) issued to each of the Lenders by the Borrower,
each one substantially in the form of Exhibit C-1 attached hereto and any
extensions, modifications, renewals or replacements of or amendments to any of
the foregoing.
"Facility B Commitment" shall mean the several obligations of the Lenders
to advance the aggregate sum of up to $250,000,000.00 to the Borrower pursuant
to the terms of the Facility B Loan Agreement, as such obligations may be
reduced from time to time pursuant to the terms of the Facility B Loan
Agreement.
"Facility B Loan Agreement" shall mean that certain Facility B Loan
Agreement dated as of February ____, 1998, among the Borrower, the Agents and
the financial institutions parties thereto, as the same may be amended,
modified, supplemented or restated from time to time.
"Facility B Loans" shall mean, collectively, amounts advanced by the
Lenders to the Borrower under the Facility B Commitment, not to exceed the
Facility B Commitment.
"Fair Market Value" shall mean, with respect to any shares of any Person's
common stock as of the date of the consummation of any Acquisition or
Investment, the closing price for such shares for the previous trading day, as
reported by the national stock exchange upon which such shares are traded. In
the event such closing price is unavailable, the Fair Market Value of such
Person's common stock shall be determined by an independent valuation firm of
recognized standing in the cellular telephone industry selected by the
Co-Administrative Agents.
"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 Funding Agent from three (3) federal funds
brokers of recognized standing selected by the Funding Agent.
"Fixed Charge Ratio" shall mean, for any calculation date, the ratio of (a)
Annualized Cash Flow to (b) Fixed Charges.
"Fixed Charges" shall mean for the Borrower and its Subsidiaries on a
consolidated basis with respect to the most recently completed four (4) fiscal
quarters, in each case after giving effect to any Interest Rate Hedge Agreements
and Eurodollar Advances, the sum of (a) Debt Service, plus (b) Capital
Expenditures, plus (c) income taxes paid, plus (d) all Restricted Payments and
Restricted Purchases made by the Borrower or any of its Subsidiaries, plus (e)
all cash payments of capital contributions made by the Borrower and its
Subsidiaries to any Person
9
which is an Investment in a Cellular System permitted hereunder, minus (f) the
amount of all cash payments of capital contributions made by minority investors
in Cellular Systems majority-owned by the Borrower or any of its Subsidiaries.
"Funding Agent" shall mean The Bank of New York, in its capacity as Funding
Agent for the Lenders and the Swing Line Lender.
"Funding Agent's Office" shall mean the office of the Funding Agent located
at The Bank of New York, Agency Function Administration, 18th Floor, One Wall
Street, New York, New York 10286, or such other office as may be designated
pursuant to the provisions of Section 11.1 hereof.
"GAAP" shall mean generally accepted accounting principles in the United
States, consistently applied.
"GAAP Interest Expense" shall mean, for any period, all interest expense
(including imputed interest with respect to Capitalized Lease Obligations) with
respect to any Indebtedness for Money Borrowed of the Borrower and its
Subsidiaries on a consolidated basis during such period pursuant to the terms of
such Indebtedness for Money Borrowed, together with all payments made pursuant
to Section 7.7(d) hereof during such period and, together with all fees payable
in respect thereof, but excluding any such fees payable on or prior to the
Agreement Date and any amortization thereof, all as calculated in accordance
with GAAP.
"Guaranty" or "Guaranteed," as applied to an obligation, shall mean and
include (a) a guaranty, direct or indirect, in any manner, of all or any part of
such obligation and (b) any agreement, direct or indirect, contingent or
otherwise, the practical effect of which is to assure in any way the payment or
performance (or payment of damages in the event of non-performance) of all or
any part of such obligation, including, without limiting the foregoing, any
reimbursement obligations as to amounts drawn down by beneficiaries of
outstanding letters of credit.
"Indebtedness" shall mean, with respect to any Person, and without
duplication, (a) all items, except items of partners' equity or capital stock or
surplus or general contingency or deferred tax reserves, which in accordance
with GAAP would be included in determining total liabilities as shown on the
liability side of a balance sheet of such Person, including, without limitation,
secured non-recourse obligations of such Person, (b) all direct or indirect
obligations of any other Person secured by any Lien to which any property or
asset owned by such Person is subject, but only to the extent of the higher of
the fair market value or the book value of the property or asset subject to such
Lien if the obligation secured thereby shall not have been assumed, (c) to the
extent not otherwise included, 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 and (d) all reimbursement obligations
(contingent or otherwise) with respect to outstanding letters of credit.
"Indebtedness for Money Borrowed" shall mean, with respect to any Person,
Indebtedness for money borrowed and Indebtedness represented by notes payable
and drafts accepted
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representing extensions of credit, all obligations evidenced by bonds,
debentures, notes or other similar instruments, all Indebtedness upon which
interest charges are customarily paid, all Capitalized Lease Obligations, all
reimbursement obligations with respect to outstanding letters of credit, all
Indebtedness issued or assumed as full or partial payment for property or
services (other than trade payables arising in the ordinary course of business,
but only if and so long as such accounts are payable on customary trade terms),
whether or not any such notes, drafts, obligations or Indebtedness represent
Indebtedness for money borrowed, and, without duplication, Guaranties of any of
the foregoing. For purposes of this definition, interest which is accrued but
not paid on the scheduled due date for such interest shall be deemed
Indebtedness for Money Borrowed.
"Indemnitee" shall have the meaning ascribed to it in Section 5.11 hereof.
"Interest Coverage Ratio" shall mean, as of any calculation date, the ratio
of Cash Flow for the most recently ended fiscal quarter of the Borrower to GAAP
Interest Expense for such quarter.
"Interest Period" shall mean (a) in connection with any Prime Rate Advance,
the period beginning on the date such Advance is made and ending on the earlier
of the last day of the calendar quarter in which such Advance is made and the
day such Advance is paid; provided, however, that if a Prime Rate Advance is
made on the last day of any calendar quarter, it shall have an Interest Period
ending on, and its Payment Date shall be, the last day of the following calendar
quarter, and (b) in connection with any Eurodollar Advance, the term of such
Advance selected by the Borrower or otherwise determined in accordance with this
Agreement. Notwithstanding the foregoing, however, (i) any applicable Interest
Period which would otherwise end on a day which is not a Business Day shall be
extended to the next succeeding Business Day unless, with respect to Eurodollar
Advances only, such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day, (ii) any
applicable Interest Period, with respect to Eurodollar Advances only, which
begins on a day for which there is no numerically corresponding day in the
calendar month during which such Interest Period is to end shall (subject to
clause (i) above) end on the last day of such calendar month and (iii) no
Interest Period shall extend beyond the Facility A Maturity Date or such earlier
date as would interfere with the Borrower's repayment obligations under Section
2.4 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 Prime Rate Basis or the Eurodollar
Basis, as appropriate.
"Interest Rate Hedge Agreements" shall mean any interest rate swap, cap,
collar, floor, caption or swaption agreements, or any similar arrangements
designed to hedge the risk of variable interest rate volatility or to reduce
interest costs, arising at any time between the Borrower, on the one hand, and
any one (1) or more of the Lenders, or any other Person (other than an
Affiliate), on the other hand, as such agreement or arrangement may be modified,
supplemented and in effect from time to time.
11
"Investment" shall mean, with respect to the Borrower or any of its
Subsidiaries, (a) any loan, advance or extension of credit (other than to
customers in the ordinary course of business) by such Person to, or any Guaranty
or other contingent liability of such Person with respect to the capital stock,
Indebtedness or other obligations of, or any contributions by such Person to the
capital of, any other Person, or any ownership, purchase or other acquisition by
such Person of any interest in any capital stock, limited partnership interest,
general partnership interest, or other securities of any such other Person,
other than an Acquisition, and (b) all expenditures by the Borrower or any of
its Subsidiaries relating to the foregoing. "Investment" shall also include the
total cost of any future commitment or other obligation binding on any Person to
make an Investment or any subsequent Investment.
"Issuing Bank" shall mean The Bank of New York, as issuer of the Letters of
Credit.
"Lenders" shall mean the financial institutions whose names appear as
"Lenders" on the signature pages hereof and any of their permitted assigns
hereunder following assignments made in accordance with Section 11.5 hereof, and
"Lender" shall mean any one of the foregoing Lenders.
"Letter of Credit Obligations" shall mean, at any time, the sum of (a) an
amount equal to the aggregate undrawn and unexpired amount (including the amount
to which any such Letter of Credit can be reinstated pursuant to the terms
hereof) of the then outstanding Letters of Credit and (b) an amount equal to the
aggregate drawn, but unreimbursed drawings on any Letters of Credit.
"Letter of Credit Reserve Account" shall mean any account maintained by the
Funding Agent for the benefit of the Issuing Bank, the Funding Agent and the
Lenders the proceeds of which shall be applied as provided in Section 8.2(a)
hereof.
"Letters of Credit" shall mean Standby Letters of Credit issued by the
Issuing Bank on behalf of the Borrower from time to time in accordance with the
terms hereof.
"Leverage Ratio" shall mean, as of any calculation date, the ratio of Total
Consolidated Debt to Annualized Cash Flow.
"Licenses" shall mean any mobile telephone, cellular telephone, microwave,
paging or other license, authorization, certificate of compliance, franchise,
approval or permit, whether for the construction or the operation of any
Cellular System, granted or issued by the FCC and held by the Borrower or any of
its Subsidiaries, all of which are listed as of the Agreement Date on Schedule 2
attached hereto.
"Lien" shall mean, with respect to any property, any mortgage, lien,
pledge, negative pledge or other agreement not to pledge, assignment, charge,
security interest, title retention agreement, levy, execution, seizure,
attachment, garnishment or other encumbrance of any kind in
12
respect of such property, whether created by statute, contract, the common law
or otherwise, and whether or not choate, vested or perfected.
"Loan Documents" shall mean this Agreement, the Notes, the Swing Line Note,
the Security Documents, the Certificate of Financial Condition, all Letters of
Credit, all legal opinions or reliance letters issued by counsel to the Borrower
or any of its Subsidiaries, all fee letters (including, without limitation,
those referred to in Section 2.5 hereof), all Requests for Advance, Requests for
Letters of Credit, Requests for Swing Line Advance, all Interest Rate Hedge
Agreements and reimbursement agreements with respect to letters of credit
permitted under Section 7.1(i) hereof, in each case, between the Borrower, on
the one hand, and the Lenders or Affiliates of the Lenders, or any of them, on
the other hand (including, without limitation, all such Interest Rate Hedge
Agreements and reimbursement agreements entered into prior to the Agreement
Date), and all other documents and agreements executed or delivered in
connection with or contemplated by this Agreement.
"Loans" shall mean, collectively, the Facility A Loans.
"MSA" shall mean any "metropolitan statistical area" as defined and
modified by the FCC for the purpose of licensing public cellular radio
telecommunications service systems.
"Majority Lenders" shall mean, at any time, Persons whose Facility A
Commitment equals or exceeds fifty-one percent (51%) of the aggregate amount of
the Facility A Commitment (after giving effect to any reductions in such
Facility A Commitment, but without giving effect to any Loans then outstanding);
provided, however, if the Facility A Commitment has been terminated or
cancelled, "Majority Lenders" shall mean Persons whose aggregate Facility A
Loans, Swing Line Loans and Letter of Credit Obligations equal or exceed
fifty-one percent (51%) of the aggregate of the Loans and Letter of Credit
Obligations then outstanding.
"Materially Adverse Effect" shall mean (a) any material adverse effect upon
the business, assets, liabilities, financial condition, results of operations,
properties, or business prospects of the Borrower and its Subsidiaries on a
consolidated basis or (b) a material adverse effect upon the binding nature,
validity or enforceability of this Agreement, the Security Documents and the
Notes, or upon the ability of the Borrower and its Subsidiaries to perform the
payment obligations or other material obligations under this Agreement or any
other Loan Document, or upon the value of the Collateral or upon the rights,
benefits or interests of the Lenders in and to the Loans or the rights of the
Collateral Agent and the Lenders in the Collateral; in any case, whether
resulting from any single act, omission, situation, status, event or
undertaking, or taken together with other such acts, omissions, situations,
statuses, events or undertakings.
"Multiemployer Plan" shall have the meaning set forth in Section 4001(a)(3)
of ERISA.
"Necessary Authorizations" shall mean all approvals and licenses from, and
all filings and registrations with, any governmental or other regulatory
authority, including, without limiting the foregoing, the Licenses and all
approvals, licenses, filings and registrations under the Communications Act,
necessary in order to enable the Borrower and its Subsidiaries to own,
13
construct, maintain, and operate Cellular Systems and to invest in other Persons
who own, construct, maintain and operate Cellular Systems.
"Net Income" shall mean, for the Borrower and its Subsidiaries on a
consolidated basis, for any period, net income determined in accordance with
GAAP.
"Net Proceeds" shall mean, with respect to any sale, lease, transfer or
other disposition of assets by the Borrower or any of its Subsidiaries, or any
issuance by the Borrower or any of its Subsidiaries of any capital stock or
other debt or equity securities permitted hereunder, the aggregate amount of
cash received for such assets or securities (including, without limitation, any
payments received for non-competition covenants and consulting or management
fees and any portion of the amount received evidenced by a seller promissory
note or other evidence of Indebtedness), net of (a) amounts reserved, if any,
for taxes payable with respect to any such transaction (after application of any
available losses, credits or other offsets), (b) reasonable and customary
transaction costs properly attributable to such transaction and payable by the
Borrower or any of its Subsidiaries (other than to an Affiliate) in connection
with such transaction including, without limitation, commissions and
underwriting discounts and (c) until actually received by the Borrower or any of
its Subsidiaries, any portion of the amount received held in escrow or evidenced
by a seller promissory note or non-compete agreement or covenant for which
compensation is paid over time. Upon receipt by the Borrower or any of its
Subsidiaries of amounts referred to in item (c) of the preceding sentence, such
amounts shall then be deemed to be "Net Proceeds."
"Notes" shall mean, collectively, the Swing Line Note and the Facility A
Notes.
"Obligations" shall mean (a) all payment and performance obligations of
every kind, nature and description of the Borrower, its Subsidiaries and any
other obligors to the Lenders, the Swing Line Lender, the Issuing Bank or the
Agents, or any of them, under this Agreement and the other Loan Documents
(including, without limitation, any interest, fees and other charges on the
Loans or otherwise under the Loan Documents that would accrue but for the filing
of a bankruptcy action with respect to the Borrower or any of its Subsidiaries
or any other such obligor, whether or not such claim is allowed in such
bankruptcy action), as they may be amended from time to time, or as a result of
making the Loans, whether such obligations are direct or indirect, absolute or
contingent, due or not due, contractual or tortious, liquidated or unliquidated,
arising by operation of law or otherwise, now existing or hereafter arising, and
(b) the obligation to pay an amount equal to the amount of any and all damage
which the Lenders, the Lenders' Affiliates, the Swing Line Lender, the Issuing
Bank or the Agents, or any of them, may suffer by reason of a breach by the
Borrower, any of its Subsidiaries or any other obligor, of any obligation,
covenant or undertaking with respect to this Agreement or any other Loan
Document.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PCS" shall mean any broadband personal communications services authorized
pursuant to 47 Code of Federal Regulations 24.1 et seq.
14
"Payment Date" shall mean the last day of any Interest Period.
"Permitted Asset Sale" shall mean the sale or exchange of assets by the
Borrower or any of its Subsidiaries as permitted under Section 7.4 hereof.
"Permitted Holders" shall mean Haynes G. Griffin, Stephen R. Leeolou, L.
Richardson Preyer, Jr., Stuart S. Richardson, their estates, spouses, ancestors,
and lineal descendants, the legal representatives of any of the foregoing and
the trustee of any bona fide trust of which the foregoing are the sole
beneficiaries or the grantors, or any Person of which the foregoing
"beneficially owns" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act)
voting securities representing at least sixty-six and two-thirds percent (66
2/3%) of the total voting power of all classes of Capital Stock of such Person
(exclusive of any matters as to which class voting rights exist) and the
Richardson Family.
"Permitted Liens" shall mean, as applied to any Person:
(a) Any Lien in favor of the Collateral Agent, for the benefit of the
Agents and the Lenders, given to secure the Obligations;
(b) (i) Liens on real estate for real estate taxes not yet delinquent
and (ii) Liens for taxes, assessments, judgments, governmental charges or
levies or claims the non-payment of which is being diligently contested in
good faith by appropriate proceedings and for which adequate reserves have
been set aside on such Person's books in accordance with GAAP, 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 diligently contested in good faith, if reserves or appropriate
provisions shall have been made therefor;
(d) Liens incurred in the ordinary course of business in connection
with worker's compensation and unemployment insurance;
(e) Restrictions on the transfer of assets imposed by any of the
Licenses as presently in effect or by any Applicable Law;
(f) Easements, rights-of-way, restrictions and other similar
encumbrances on the use of real property which do not interfere with the
ordinary conduct of the business of such Person, or Liens incidental to the
conduct of the business of such Person or to the ownership of its
properties which were not incurred in connection with Indebtedness or other
extensions of credit and which do not in the aggregate materially detract
from the value of such properties or materially impair their use in the
operation of the business of such Person;
15
(g) Purchase money security interests, which are perfected
automatically by operation of law, only for the period (not to exceed
twenty (20) days) of automatic perfection under the law of the applicable
jurisdiction, and limited to Liens on assets so purchased;
(h) Liens reflected by Uniform Commercial Code financing statements
filed in respect of Capitalized Lease Obligations permitted hereunder and
true leases of the Borrower or any of its Subsidiaries;
(i) Any Liens of record which are listed as of the Agreement Date on
Schedule 3 attached hereto, which Liens secure Indebtedness in an amount
not to exceed $5,000,000.00 in the aggregate at any time; and
(j) Liens on the assets acquired with the Indebtedness permitted under
Section 7.1(h) hereof, provided that such Lien secures only the
Indebtedness incurred to purchase the asset covered thereby.
"Person" shall mean an individual, corporation, limited liability company,
association, partnership, joint venture, trust or estate, an unincorporated
organization, a government or any agency or political subdivision thereof, or
any other entity.
"Plan" shall mean an employee benefit plan within the meaning of Section
3(3) of ERISA or any other employee benefit plan maintained for employees of any
Person or any affiliate of such Person.
"POPS" shall mean, as of any calculation date, with respect to any RSA or
MSA, the population of such RSA or MSA as such number is published in the most
recent Donnelly Marketing Service Population Guide.
"Prime Rate" shall mean, at any time, the higher of (a) the rate of
interest adopted by the Funding Agent as the 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 the Funding Agent as its "prime rate" or "prime
commercial lending rate," or (b) the Federal Funds Rate, plus one-half of one
percent (0.5%). The Prime Rate is not necessarily the lowest rate of interest
charged to borrowers of BNY.
"Prime Rate Advance" shall mean an Advance which the Borrower requests to
be made as a Prime Rate Advance or is reborrowed as a Prime Rate Advance, in
accordance with the provisions of Section 2.2 hereof, which bears interest at
the Prime Rate Basis and which shall be in a principal amount of at least
$2,000,000.00, and in an integral multiple of $500,000.00.
"Prime Rate Basis" shall mean a simple interest rate equal to the sum of
(a) the Prime Rate and (b) the Applicable Margin as determined by Section 2.3(f)
hereof. The Prime Rate Basis shall be adjusted automatically as of the opening
of business on the effective date of each change in the Prime Rate to account
for such change, and shall also be changed to reflect adjustments in the
Applicable Margin.
16
"Pro Forma Debt Service" shall mean for the Borrower and its Subsidiaries
on a consolidated basis with respect to the next succeeding complete four (4)
fiscal quarter period following the calculation date, and after giving effect to
any Interest Rate Hedge Agreements and Eurodollar Advances, the sum of the
aggregate of all cash principal, GAAP Interest Expense, fees and other payments
payable by such Persons during such period in respect of Indebtedness for Money
Borrowed, other than repayments required under Section 2.7 hereof. For purposes
of this definition, where interest payments for the four (4) quarter period
immediately succeeding the calculation date are not fixed by way of Interest
Rate Hedge Agreements, Eurodollar Advances, or otherwise for the entire period,
interest shall be calculated on such Indebtedness for Money Borrowed for periods
for which interest payments are not so fixed at the Eurodollar Basis (based on
the then current adjustment under Section 2.3(f) hereof) for a Eurodollar
Advance having an Interest Period of twelve (12) months as determined on the
date of calculation.
"Pro Forma Debt Service Ratio" shall mean, as of any calculation date, the
ratio of Annualized Cash Flow to Pro Forma Debt Service.
"RSA" shall mean any "rural service area" as defined and modified by the
FCC for the purpose of licensing public cellular radio telecommunications
service systems.
"Rating Agencies" shall mean Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., and Moody's Investors Service, Inc., or any successor to the
respective rating agency businesses thereof.
"Reportable Event" shall have the meaning set forth in Title IV of ERISA.
"Request for Advance" shall mean a certificate designated as a "Request for
Advance," signed by an Authorized Signatory requesting an Advance hereunder,
which shall be in substantially the form of Exhibit D attached hereto, and
shall, among other things, (a) specify the date of the Advance, which shall be a
Business Day, the amount of the Advance, the type of Advance and, with respect
to Eurodollar Advances, the Interest Period selected by the Borrower, (b) state
that there shall not exist, on the date of the requested Advance and after
giving effect thereto, a Default, as of the date of such Advance and after
giving effect thereto and (c) as to Advances which will increase the principal
amount of the Loans then outstanding, specify the use of the proceeds of the
Loans being requested.
"Request for Issuance of Letter of Credit" shall mean any certificate
signed by an Authorized Signatory of the Borrower requesting that the Issuing
Bank issue a Letter of Credit hereunder, which certificate shall be in
substantially the form of Exhibit K attached hereto and shall, among other
things, state (a) the stated amount of the Letter of Credit, (b) the effective
date for the issuance of the Letter of Credit (which shall be a Business Day),
(c) the date on which the Letter of Credit is to expire (which shall be a
Business Day), (d) the Person for whose benefit such Letter of Credit is to be
issued, (e) that the requirements of Section 3.3 hereof have been satisfied; and
(f) other relevant terms of such Letter of Credit.
17
"Request for Swing Line Advance" shall mean any certificate signed by an
Authorized Signatory of the Borrower requesting a Swing Line Advance hereunder
which will increase the aggregate amount of the Swing Line Loans outstanding,
which certificate shall be denominated a "Request for Swing Line Advance," shall
be in substantially the form of Exhibit L attached hereto and shall, among other
things, (a) specify the date of the Swing Line Advance, which shall be a
Business Day, (b) specify the amount of the Swing Line Advance and certify that
the use of the proceeds thereof will be in compliance with the terms of the Loan
Agreement, (c) state that there shall not exist, on the date of the requested
Swing Line Advance and after giving effect thereto, a Default or an Event of
Default, (d) state that all conditions precedent to the making of the Swing Line
Advance have been satisfied and (e) certify that the aggregate amount of the
Swing Line Loans and the Loans, together with the amount of the Swing Line
Advance, does not exceed the lesser of the Available Facility A Commitment and
the Available Swing Line Commitment.
"Restricted Payment" shall mean (a) any direct or indirect distribution,
dividend or other payment to any Person (other than to the Borrower or any
wholly-owned 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 (other than stock dividends and stock
splits), including, without limitation, any warrants or other rights or options
to acquire shares of capital stock, general or limited partnership interests or
other securities of the Borrower or any of its Subsidiaries, or any prepayment
or repurchase by the Borrower or any of its Subsidiaries of subordinated debt of
the Borrower or any of its Subsidiaries or (b) any management or consulting
fees.
"Restricted Purchase" shall mean any payment on account of the purchase,
redemption, defeasance or other acquisition or retirement of any general or
limited partnership interest in, or shares of capital stock or other securities
of, the Borrower or any of the Borrower's Subsidiaries, including, without
limitation, any warrants or other rights or options to acquire shares of capital
stock, general or limited partnership interests or other securities of the
Borrower or any of the Borrower's Subsidiaries.
"Richardson Family" shall mean, collectively, the descendants of Lunsford
Richardson, Sr., and any of their respective spouses, estates, lineal
descendants, heirs, executors, personal representatives, administrators, trusts
for any of their benefit and charitable foundations to which shares of
Vanguard's Capital Stock beneficially owned by any of the foregoing have been
transferred.
"Security Documents" shall mean the Borrower Pledge Agreement, the Vanguard
Guaranty, the Vanguard Pledge Agreement, the VCOC Guaranty, any other agreement
or instrument providing collateral for the Obligations, whether now or hereafter
in existence, and any filings, instruments, agreements and documents related
thereto or to this Agreement and providing Collateral for any of the
Obligations.
"Security Interest" shall mean all Liens in favor of the Collateral Agent,
for the benefit of the Lenders, or in favor of any Lender, created hereunder or
under any of the Security Documents to secure the Obligations.
18
"Standby Letter of Credit" shall mean a letter of credit issued to support
obligations of the Borrower.
"Subordinated Debt" shall mean any Indebtedness for Money Borrowed of any
Person which is expressly subordinated to the payment of the Obligations and to
any "Obligations" under the Facility B Loan Agreement.
"Subsidiary" shall mean, as applied to any Person, (a) any corporation of
which more than fifty percent (50%) of the outstanding stock (other than
directors' qualifying shares) having ordinary voting power to elect 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 more than fifty percent (50%) of the outstanding
partnership interests, is at the time owned directly or indirectly by such
Person, or by one (1) or more Subsidiaries of such Person, or by such Person and
one (1) or more Subsidiaries of such Person, or (b) any entity which is directly
or indirectly controlled or capable of being controlled by such Person, or by
one (1) or more Subsidiaries of such Person, or by such Person and one or more
Subsidiaries of such Person. "Subsidiaries" as used herein shall mean the
Subsidiaries of the Borrower. The Subsidiaries of the Borrower as of the
Agreement Date are set forth on Schedule 4 attached hereto, except as otherwise
noted thereon. For all purposes under this Agreement (except as otherwise set
forth herein), with respect to the Borrower, "Subsidiary" or "Subsidiaries"
shall not include any Unrestricted Subsidiary or the VCS Subsidiary.
"Swing Line Advance" or "Swing Line Advances" shall mean amounts advanced
by the Swing Line Lender to the Borrower pursuant to Section 2.15 hereof on the
occasion of any borrowing. Swing Line Advances may be in any amount agreed to by
the Borrower and the Swing Line Lender, provided that such amount is a whole
dollar amount.
"Swing Line Commitment" shall mean the obligation of the Swing Line Lender
to advance funds in the aggregate sum of up to $10,000,000.00 to the Borrower
pursuant to the terms hereof.
"Swing Line Lender" shall mean The Bank of New York.
"Swing Line Loans" shall mean the aggregate principal amount of all Swing
Line Advances.
"Swing Line Note" shall mean that certain promissory note in the principal
amount of $10,000,000.00 issued by the Borrower to the Swing Line Lender,
substantially in the form of Exhibit C-2 attached hereto, any other swing line
note issued pursuant to this Agreement in respect of the Swing Line Commitment,
and any extensions, renewals or amendments to any of the foregoing.
19
"Syndication Agent" shall mean NationsBank of Texas, N.A., in its capacity
as Syndication Agent.
"Total Consolidated Debt" shall mean, for Vanguard and its Subsidiaries on
a consolidated basis as of any date, the sum (without duplication) of (a) the
outstanding principal amount of the Loans, (b) Indebtedness secured by a Lien
permitted under subsection (i) of the definition of "Permitted Liens," and (c)
all other Indebtedness for Money Borrowed.
"Tower Sale/Leaseback Transaction" shall mean any arrangement, direct or
indirect, entered into by the Borrower or any of its Subsidiaries, on the one
hand, and any third party, on the other hand, pursuant to which the Borrower or
such Subsidiary shall sell or transfer any tower or towers, whether now owned or
hereafter acquired, and shall then or thereafter rent or lease as lessee such
tower or towers or any part thereof which the Borrower or such Subsidiary
intends to use for substantially the same purpose or purposes as the tower or
towers sold or transferred.
"Unrestricted Subsidiaries" shall mean any Subsidiaries (as such term is
defined in the first sentence of the definition of "Subsidiary" herein) of the
Borrower which are designated as "Unrestricted Subsidiaries" in accordance with
Section 7.15 hereof. The financial condition and operations of any Unrestricted
Subsidiary shall not be consolidated with those of Vanguard and its Subsidiaries
for financial reporting and financial covenant purposes herein.
"Upstream Dividends" shall have the meaning set forth in Section 7.17
hereof. "VCOC" shall mean Vanguard Cellular Operating Corp., a Delaware
corporation.
"VCOC Guaranty" shall mean that certain Guaranty, substantially in the form
of Exhibit E attached hereto, in favor of the Collateral Agent for the benefit
of the Lenders, given by VCOC of even date herewith.
"VCS Subsidiary" shall mean Vanguard Cellular Services, Inc., a Delaware
corporation, which is an indirect wholly-owned subsidiary of the Borrower, and
any of its subsidiaries. The financial condition and operations of the VCS
Subsidiary shall be consolidated with those of Vanguard or the Borrower, as
applicable, and its Subsidiaries for financial covenant purposes herein.
"Vanguard" shall mean Vanguard Cellular Systems, Inc., a North Carolina
corporation.
"Vanguard Debentures" shall mean those certain 9-3/8% Senior Debentures due
April 15, 2006 issued by Vanguard pursuant to the Vanguard Indenture in an
aggregate principal amount of $200,000,000.00.
"Vanguard Guaranty" shall mean that certain Guaranty, substantially in the
form of Exhibit F attached hereto, in favor of the Collateral Agent for the
benefit of the Lenders, given by Vanguard of even date herewith.
20
"Vanguard Indenture" shall mean that certain Indenture dated as of April 1,
1996 between Vanguard and The Bank of New York, as trustee, as supplemented by
First Supplemental Indenture dated as of April 1, 1996.
"Vanguard Interest Rate Hedge Agreements" shall mean any interest rate
swap, cap, collar, floor, caption or swaption agreements, or any similar
arrangements designed to reduce interest costs under the Vanguard Debentures,
arising at any time between Vanguard, on the one hand, and any one (1) or more
of the Lenders, or any other Person (other than an Affiliate), on the other
hand, as such agreement or arrangement may be modified, supplemented and in
effect from time to time; provided that (a) any such agreement or arrangement
has a notional amount of not more than seventy-five percent (75%) of the
aggregate outstanding principal amount of the Vanguard Debentures and (b) the
obligation to pay interest in respect of such notional amount shall be capped at
a rate acceptable to the Co-Administrative Agents for a period of not less than
three (3) years from the date of such agreement or arrangement.
"Vanguard Pledge Agreement" shall mean that certain Pledge Agreement,
substantially in the form of Exhibit G attached hereto, by and between Vanguard
and the Collateral Agent of even date herewith.
"Vanguard Subordinated Debt" shall mean, collectively, the Vanguard
Debentures and other unsecured Subordinated Debt of Vanguard provided that (i)
such Subordinated Debt is subordinated to the prior payment and performance of
the Obligations, (ii) under the terms of such Subordinated Debt there shall be
no mandatory payment or mandatory prepayment of principal in respect thereof
prior to one (1) year following the Facility A Maturity Date, (iii) such
Subordinated Debt contains terms and conditions no more onerous than contained
herein, (iv) such Subordinated Debt has no benefit of any Guaranty and (v) both
before and after giving effect to the incurrence of such Subordinated Debt by
Vanguard, the Borrower shall be in compliance with the terms of this Agreement,
including, without limitation, Sections 7.7, 7.8, 7.9, 7.10 and 7.11 hereof, and
the Borrower shall have delivered to the Lenders pro forma projections
demonstrating such compliance.
"Voting Stock" shall mean, with respect to a corporation, all classes of
Capital Stock of such corporation then outstanding and normally entitled to vote
in the election of directors.
"Wholly Owned Subsidiary" shall mean, at any time, a Subsidiary, all of the
Voting Stock of which (except directors' qualifying shares) is at the time
owned, directly or indirectly, by Vanguard.
Section 1.2 Interpretation. Each definition of an agreement in this Article
1 shall, unless otherwise specified, include such agreement as modified,
amended, restated or supplemented from time to time in accordance herewith and
therewith, and except where the context otherwise requires, the singular shall
include the plural and vice versa. Except where otherwise specifically
restricted, reference to a party to this Agreement or any other Loan Document
includes that party and its successors and assigns. All capitalized terms used
herein which are defined in Article 9 of the Uniform Commercial Code in effect
in the State of New
21
York on the date hereof and which are not otherwise defined herein shall have
the same meanings herein as set forth therein.
Section 1.3 Cross References. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause in
such Article, Section or definition.
ARTICLE 2
Loans and Letters of Credit
Section 2.1 The Loans and Letters of Credit.
(a) Facility A Loans. The Lenders agree, severally in accordance with their
respective Commitment Ratios and not jointly, upon the terms and subject to the
conditions of this Agreement, to lend and relend to the Borrower from time to
time amounts which do not exceed in the aggregate at any one time outstanding
the Available Facility A Commitment as in effect from time to time. Advances
under the Facility A Commitment may be repaid and then reborrowed as provided in
Sections 2.2(b) and 2.2(c) hereof.
(b) The Letters of Credit. Subject to the terms and conditions of this
Agreement, the Issuing Bank agrees to issue Letters of Credit for the account of
the Borrower pursuant to Section 2.14 hereof in an aggregate amount at any one
time outstanding not to exceed the Available Letter of Credit Commitment.
(c) Swing Line Loans by the Swing Line Lender. Subject to the terms and
conditions of this Agreement, the Swing Line Lender agrees upon the terms and
subject to the conditions of this Agreement to lend and relend to the Borrower,
prior to the Facility A Maturity Date, Swing Line Advances which in the
aggregate at any one time outstanding do not exceed the Available Swing Line
Commitment.
Section 2.2 Manner of Borrowing and Disbursement.
(a) Choice of Interest Rate; etc. Any Advance hereunder shall, at the
option of the Borrower, be made as a Prime Rate Advance or a Eurodollar Advance;
provided, however, that at such time as there shall have occurred and be
continuing a Default, and the Funding Agent shall have provided the Borrower
with written notice thereof, the Borrower shall not have the right to re-borrow
any Eurodollar Advances and all subsequent Advances shall be made as Prime Rate
Advances. Any notice given to the Funding Agent in connection with a requested
Advance hereunder shall be given to the Funding Agent prior to 11:00 a.m. (New
York, New York time) in order for such Business Day to count toward the minimum
number of Business Days required.
22
(b) Prime Rate Advances.
(i) Advances. The Borrower shall give the Funding Agent in the case of
Prime Rate Advances at least two (2) 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 Funding Agent shall promptly notify each
Lender by telephone or telecopy of the contents thereof.
(ii) Repayments and Reborrowings. The Borrower may repay or prepay a
Prime Rate Advance without regard to its Payment Date and (i) reborrow all
or a portion of the principal amount thereof as one (1) or more Prime Rate
Advances, (ii) upon at least three (3) Business Days' irrevocable prior
written notice, reborrow all or a portion of the principal thereof as one
(1) or more Eurodollar Advances or (iii) not reborrow all or any portion of
such Prime Rate Advance. On each Payment Date and such other date indicated
by the Borrower, such Prime Rate Advance shall be so repaid and, as
applicable, reborrowed.
(c) Eurodollar Advances.
(i) Advances. The Borrower shall give the Funding 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 not invalidate any notice so given. The Funding Agent, whose
determination shall be conclusive, shall determine the available Eurodollar
Bases and shall notify the Borrower of such Eurodollar Bases. The Borrower
shall promptly notify the Funding 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. Upon receipt of
such notice from the Borrower, the Funding Agent shall promptly notify each
Lender by telephone or telecopy of the contents thereof.
(ii) Repayments and Reborrowings. At least three (3) Business Days
prior to each Payment Date for a Eurodollar Advance, the Borrower shall
give the Funding Agent written notice specifying whether all or a portion
of any Eurodollar Advance outstanding on the Payment Date (i) is to be
repaid and then reborrowed in whole or in part as one (1) or more
Eurodollar Advances, (ii) is to be repaid and then reborrowed in whole or
in part as a Prime Rate Advance or (iii) is to be repaid and not
reborrowed. Upon such Payment Date such Eurodollar Advance will, subject to
the provisions hereof, be so repaid and, as applicable, reborrowed.
(d) Notification of Lenders. Upon receipt of a Request for Advance, or a
notice from the Borrower with respect to any outstanding Advance prior to the
Payment Date
23
for such Advance, the Funding Agent shall promptly notify each Lender by
telephone or telecopy of the contents thereof and the amount of such Lender's
portion of such Advance. Each Lender shall, not later than 12:00 noon (New York,
New York time) on the date of borrowing specified in such notice, make available
to the Funding Agent at the Funding Agent's Office, or at such account as the
Funding Agent shall designate, the amount of its ratable portion of any Advance
which represents an additional borrowing hereunder in immediately available
funds.
(e) Disbursement.
(i) Prior to 2:00 p.m. (New York, New York time) on the date of an
Advance hereunder, the Funding Agent shall, subject to the satisfaction of
the conditions set forth in Article 3 hereof, disburse the amounts made
available to the Funding Agent by the Lenders in like funds by (a)
transferring the amounts so made available by wire transfer pursuant to the
Borrower's instructions, or (b) in the absence of such instructions,
crediting the amounts so made available to the account of the Borrower
maintained with the Funding Agent.
(ii) Unless the Funding Agent shall have received notice from a Lender
prior to 12:00 noon (New York, New York time) on the date of any Advance
that such Lender will not make available to the Funding Agent such Lender's
ratable portion of such Advance, the Funding Agent may assume that such
Lender has made or will make such portion available to the Funding Agent on
the date of such Advance and the Funding 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 such Lender does not
make such ratable portion available to the Funding Agent, such Lender
agrees to repay to the Funding 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
Funding Agent, at the Federal Funds Rate, plus one percent (1%).
(iii) If such Lender shall repay to the Funding Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
portion of the applicable Advance for purposes of this Agreement. If such
Lender does not repay such corresponding amount immediately upon the
Funding Agent's demand therefor, the Funding Agent shall notify the
Borrower and the Borrower shall immediately pay such corresponding amount
to the Funding Agent, with interest at the Interest Rate Basis applicable
to the underlying Advance. The failure of any Lender to fund its portion of
any Advance shall not relieve any other Lender of its obligation hereunder
to fund its respective portion of the Advance on the date of such
borrowing, but no Lender shall be responsible for any such failure of any
other Lender.
(iv) In the event that, at any time no Default then exists and the
conditions precedent to borrowing in Article 3 hereof have been satisfied,
a Lender for any reason fails or refuses to fund its portion of an Advance,
then, until such time as such Lender has funded its portion of such Advance
(which late funding shall not absolve such Lender from
24
any liability it may have to the Borrower), or all other Lenders have
received payment in full (whether by repayment or prepayment) of the
principal and interest due in respect of such Advance, such non-funding
Lender shall not have the right (i) to vote regarding any issue on which
voting is required or advisable under this Agreement or any other Loan
Document calling for less than one hundred percent (100%) Lender consent,
and the amount of the Loans of such Lender shall not be counted as
outstanding for purposes of determining "Majority Lenders" hereunder, or
(ii) to receive payments of principal, interest or fees from the Borrower
in respect of its unfunded Advances.
Section 2.3 Interest.
(a) On Prime Rate Advances. Interest on each Prime Rate Advance shall be
computed on the basis of a year of 365/366 days for the actual number of days
elapsed and shall be payable at the Prime Rate Basis for such Advance, in
arrears on each applicable Payment Date. Interest on Prime Rate Advances then
outstanding shall also be due and payable on the Facility A Maturity Date.
(b) On Eurodollar Advances. Interest on each Eurodollar Advance shall be
computed on the basis of a 360-day year for the actual number of days elapsed
and shall be payable at the Eurodollar Basis for such Advance, in arrears on the
applicable Payment Date, 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 Facility A Maturity Date.
(c) Interest if no Notice of Selection of Interest Rate Basis. If the
Borrower fails to give the Funding 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, the Prime Rate Basis shall apply to such
Advance.
(d) Interest Upon Default. Immediately upon the occurrence of an Event of
Default, the outstanding principal balance of the Loans shall bear interest at
the Default Rate. Such interest shall be payable on demand, and shall accrue
until the earliest of (a) waiver or cure (to the satisfaction of the Lenders
required under Section 11.12 hereof to waive) of the applicable Default, (b)
agreement by the Majority Lenders to rescind the charging of interest at the
Default Rate or (c) payment in full of the Obligations.
(e) Eurodollar Advance Contracts. At no time may the number of outstanding
Eurodollar Advances hereunder and under the Facility B Loan Agreement in the
aggregate exceed ten (10).
(f) Applicable Margin. With respect to any Advance hereunder, the
Applicable Margin shall be the interest rate margin determined by the Funding
Agent based upon the Leverage Ratio for the most recent fiscal quarter end,
effective as of the second (2nd) Business Day after the financial statements
referred to in Section 6.1 or 6.2 hereof, as applicable, are
25
required to be furnished by the Borrower to the Funding Agent and each Lender
for the fiscal quarter most recently ended, expressed as a per annum rate of
interest as follows:
Prime Rate Advance Eurodollar Advance
Leverage Ratio Applicable Margin Applicable Margin
-------------- ----------------- -----------------
7.00:1 or greater 0.250% 1.500%
6.00:1 or greater but
less than 7.00:1 0.000% 1.250%
5.00:1 or greater but
less than 6.00:1 0.000% 1.000%
4.00:1 or greater but
less than 5.00:1 0.000% 0.750%
3.00:1 or greater but
less than 4.00:1 0.000% 0.625%
Less than 3.00:1 0.000% 0.500%
The Applicable Margins in effect on the Agreement Date shall be based upon a
certificate, dated the Agreement Date, by a senior financial officer of the
Borrower showing the Leverage Ratio on a pro forma basis (after giving effect to
the initial Advances hereunder) and delivered to the Funding Agent on the
Agreement Date.
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 or 6.2 hereof, as
applicable, and without prejudice to any additional rights under Section 8.2
hereof, the Leverage Ratio shall be deemed to be equal to 7.00:1 until the
second (2nd) Business Day after the actual delivery of such statements.
Section 2.4 Scheduled Commitment Reductions. Commencing September 30, 2000,
and at the end of each calendar quarter thereafter, the Facility A Commitment as
in effect on September 30, 2000, shall be automatically reduced by the
percentages set forth below:
Quarterly Percentage Reduction of
Facility A Commitment In Effect on
Dates of Reduction September 30, 2000
------------------ ----------------------------------
September 30, 2000 and 2.500%
December 31, 2000
March 31, 2001, June 30, 3.750%
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2001, September 30, 2001 and
December 31, 2001
March 31, 2002, June 30, 3.750%
2002, September 30, 2002 and
December 31, 2002
March 31, 2003, June 30, 4.375%
2003, September 30, 2003 and
December 31, 2003
March 31, 2004, June 30, 5.000%
2004, September 30, 2004 and
December 31, 2004
March 31, 2005, June 30, 6.875%
2005, September 30, 2005 and
December 31, 2005
The Borrower shall make a repayment of the Facility A Loans outstanding,
together with accrued interest thereon, on or before the effective date of each
reduction in the Facility A Commitment under this Section 2.4, such that the
aggregate principal amount of the Facility A Loans, the Swing Line Loans and the
Letter of Credit Obligations outstanding at no time exceeds the Facility A
Commitment as so reduced. In addition, any remaining unpaid principal and
interest under the Facility A Commitment shall be due and payable in full on the
Facility A Maturity Date.
Section 2.5 Fees.
(a) Facility A Commitment Fees. The Borrower agrees to pay to the Lenders,
including the Agents in their capacities as Lenders, such fees as are mutually
agreed upon and as are described in fee letters dated as of the Agreement Date,
one between the Borrower and each of the Lenders. All of such fees are due and
payable and shall be paid not later than the Agreement Date. In addition, the
Borrower agrees to pay each of the Lenders, in accordance with their respective
Commitment Ratios, a commitment fee on the aggregate unborrowed balance of the
Available Facility A Commitment for each day from the Agreement Date through the
Facility A Maturity Date, (A) at all times during which the Leverage Ratio is
greater than 5.50:1, at the rate of three-eighths of one percent (0.375%) per
annum, and (B) at all times during which the Leverage Ratio is less than or
equal to 5.50:1, at the rate of one-quarter of one percent (0.250%) per annum.
The commitment fee shall be subject to reduction or increase, as applicable,
based on the Leverage Ratio of the Borrower for the fiscal quarter most recently
ended as reflected in the financial statements required to be delivered for such
quarter pursuant to Section 6.1 or 6.2 hereof. Any adjustment provided for in
this Section 2.5(a) shall be effective as of the second (2nd) Business Day after
the day on which financial statements are required to be delivered to the
Funding Agent and each Lender pursuant to Sections 6.1 and 6.2
27
hereof, as the case may be, except with respect to any payment of the commitment
fee hereunder occurring prior to the second (2nd) Business Day after the date
such financial statements are actually delivered to the Funding Agent and each
Lender. The commitment fee in effect on the Agreement Date shall be based upon a
certificate, dated the Agreement Date, by a senior financial officer of the
Borrower showing the Leverage Ratio on a pro forma basis (after giving effect to
initial Advances hereunder) and delivered to the Funding Agent on the Agreement
Date. Such commitment fee shall be computed on the basis of a year of 360 days
for the actual number of days elapsed, shall be payable quarterly in arrears on
the last day of each calendar quarter, commencing on March 31, 1998, 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 Facility A
Maturity Date.
(b) Letter of Credit Fees.
(i) The Borrower shall pay to the Issuing Bank a fee on the undrawn face
amount of any outstanding Letters of Credit from the date of issuance through
the expiration date of each such Letter of Credit at a rate of one-eighth of one
percent (0.125%) per annum, which fee shall be computed on the basis of a year
of 365/366 days for the actual number of days elapsed, and shall be payable
quarterly in arrears on the last day of each quarter (and on the Facility A
Maturity Date) commencing on March 31, 1998.
(ii) The Borrower shall also pay to the Funding Agent on behalf of the
Lenders in accordance with their respective Commitment Ratios, a fee on the
undrawn face amount of any outstanding Letters of Credit for each day from the
date of issuance thereof through the expiration date for each such Letter of
Credit at a rate per annum equal to the Applicable Margin for Eurodollar
Advances. Such letter of credit fee shall be computed on the basis of a year of
365/366 days for the actual number of days elapsed and shall be payable
quarterly in arrears for each quarter on the last day of each calendar quarter
(and on the Facility A Maturity Date) commencing on March 31, 1998. The letter
of credit fee set forth in this Section 2.5(b)(ii) shall be subject to increase
and decrease on the dates and in the amounts set forth in Section 2.3(f) hereof
in the same manner as the adjustment of the Applicable Margin with respect to
Eurodollar Advances.
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Section 2.6 Optional Prepayments and Commitment Reductions.
(a) Prepayment of Advances. The principal amount of any Prime Rate Advance
may be prepaid in full or in part at any time, without penalty and without
regard to the Payment Date for such Advance, upon one (1) Business Days' prior
written notice to the Funding Agent of such prepayment. Eurodollar Advances may
be prepaid prior to the applicable Payment Date, upon three (3) Business Days'
prior written notice to the Funding Agent, provided that the Borrower shall
reimburse the Lenders and the Funding Agent, on demand, for any loss or
out-of-pocket expense incurred by any Lender or the Funding Agent in connection
with such prepayment, as set forth in Section 2.10 hereof. Partial prepayments
shall be in a principal amount of not less than $2,000,000.00, and in an
integral multiple of $500,000.00.
(b) Permanent Prepayment of Loans. Amounts permanently prepaid on the Loans
whether by way of refinancing, prepayment of Advances under the Facility A
Commitment accompanied by a corresponding reduction in the Facility A Commitment
or otherwise, shall be applied to principal, to permanently reduce the Facility
A Commitment by an amount equal to the amount of such prepayment, pro rata over
the Facility A Commitment reduction schedule set forth in Section 2.4 hereof,
and to prepay the principal amount outstanding under the Facility A Commitment
to the extent necessary to prevent the Facility A Loans outstanding from
exceeding the Facility A Commitment as so reduced. Amounts applied to the
Facility A Loans shall permanently reduce the Facility A Commitment in an equal
amount. Each such prepayment shall be accompanied by a payment of all accrued
but unpaid interest and fees with respect to the amount so prepaid. A notice of
prepayment shall be irrevocable. Upon receipt of any notice of prepayment, the
Funding Agent shall promptly notify each Lender of the contents thereof by
telephone or telecopy and of such Lender's ratable portion of the prepayment.
Any portion of the Loans which is permanently prepaid may not be reborrowed.
(c) Facility A Commitment Reduction. The Borrower may at any time, without
penalty (but subject to Section 2.10 hereof), terminate or permanently reduce
all or any part of the Facility A Commitment by giving the Funding Agent and the
Lenders at least ten (10) Business Days' prior written notice thereof; provided,
however, that any reduction shall reduce the Facility A Commitment in a
principal amount of at least $2,000,000.00 and in an integral multiple of
$500,000.00. The Borrower shall make any required repayment or prepayment of
Advances outstanding under the Facility A Commitment, plus accrued interest on
such portion of the Facility A Loans and any accrued fees in respect thereof, on
or before the effective date of the reduction of the Facility A Commitment, so
that the principal amount of the Facility A Loans, the Swing Line Loans and the
Letter of Credit Obligations outstanding after such repayment or prepayment does
not exceed the Facility A Commitment as so reduced. The Borrower shall not have
any right to rescind any termination or reduction pursuant to this Section
2.6(c). Reductions in the Facility A Loan Commitment after September 30, 2000,
pursuant to this Section 2.6(c) shall be applied pro rata over the Facility A
Commitment reduction schedule set forth in Section 2.4 hereof.
29
Section 2.7 Mandatory Prepayments. In addition to the scheduled repayments
and Facility A Commitment reductions provided for in Section 2.4 hereof, the
Borrower shall prepay the Obligations as follows:
(a) Reductions from Asset Sales. Except with respect to Permitted
Asset Sales, on the Business Day of the receipt by the Borrower or any
Subsidiary of the Borrower of any Net Proceeds with respect to any sale of
any equity ownership in or assets of the Borrower or any Subsidiary of the
Borrower, the Facility A Commitment shall be permanently reduced by an
amount equal to the Facility A Net Proceeds of such sale. Reductions of the
Facility A Commitment under this Section shall be applied in the order of
priority set forth in Section 2.6(b) hereof.
(b) Loans Exceeding Commitment. If, at any time, the amount of the
Facility A Loans, the Swing Line Loans and the Letter of Credit Obligations
then outstanding shall exceed the Facility A Commitment, the Borrower shall
on such date make a repayment of the principal amount of the Loans in an
amount equal to such excess.
Section 2.8 Notes; Loan Accounts.
(a) The Loans shall be repayable in accordance with the terms and
provisions set forth herein and shall be evidenced by the Notes. One (1)
Facility A Note shall be payable to the order of each Lender, in accordance with
their respective Commitment Ratios. The Notes shall be issued by the Borrower to
the Lenders and shall be duly executed and delivered by one (1) or more
Authorized Signatories of the Borrower.
(b) Each Lender 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
Lender 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 Lender 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 Lender to make any such notations or any error
or mistake in such notations shall not affect the Borrower's repayment
obligations with respect to such Loans.
Section 2.9 Manner of Payment.
(a) Except for payments with respect to any Swing Line Loan, each payment
(including, without limitation, any prepayment) by the Borrower on account of
the principal of or interest on the Loans, commitment fees and any other amount
owed to the Lenders or the Funding Agent or any of them under this Agreement or
the Notes shall be made not later than 1:00 p.m. (New York, New York time) on
the date specified for payment under this Agreement to the Funding Agent at the
Funding Agent's Office, for the account of the Lenders or the Funding Agent, as
the case may be, in lawful money of the United States of America in immediately
available funds. Any payment received by the Funding Agent after 1:00 p.m. (New
York, New York time) shall be deemed received on the next Business Day. Receipt
by the
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Funding Agent of any payment intended for any Lender or Lenders hereunder prior
to 1:00 p.m. (New York, New York time) on any Business Day shall be deemed to
constitute receipt by such Lender or Lenders on such Business Day. In the case
of a payment for the account of a Lender, the Funding Agent will promptly
thereafter distribute the amount so received in like funds to such Lender. If
the Funding Agent shall not have received any payment from the Borrower as and
when due, the Funding Agent will promptly notify the Lenders accordingly.
(b) The Borrower agrees to pay principal, interest, fees and all other
amounts due hereunder, under the Notes or under any other Loan Document without
set-off, counterclaim or any deduction whatsoever and free and clear of all
taxes (other than taxes based on the income of any Lender), levies and
withholding. If the Borrower is required by Applicable Law to deduct any taxes
from or in respect of any sum payable to any Agent or any Lender hereunder,
under any Note or under any other Loan Document: (i) the sum payable hereunder
or thereunder, as applicable, shall be increased to the extent necessary to
provide that, after making all required deductions (including, without
limitation, deductions applicable to additional sums payable under this Section
2.9(b)), such Agent or such Lender, as applicable, receives an amount equal to
the sum it would have received had no such deductions been made; (ii) the
Borrower shall make such deductions from such sums payable hereunder or
thereunder, as applicable, and pay the amount so deducted to the relevant taxing
authority as required by Applicable Law; and (iii) the Borrower shall provide
such Agent or such Lender, as applicable, with evidence satisfactory to such
Agent or such Lender, as applicable, that such deducted amounts have been paid
to the relevant taxing authority.
(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 Funding Agent with respect to the Obligations, the Funding Agent shall
distribute such amounts in the following order of priority, all on a pro rata
basis to the Lenders: (i) to the payment on a pro rata basis of any fees or
expenses then due and payable to the Agents, the Lenders, or any of them; (ii)
to the payment of interest then due and payable on the Loans; (iii) to the
payment of all other amounts not otherwise referred to in this Section 2.9(c)
then due and payable to the Agents or the Lenders, or any of them, hereunder or
under the Notes or any other Loan Document; (iv) to the payment of outstanding
Swing Line Advances to the full extent thereof; and (v) to the payment of
principal then due and payable on the Notes.
(d) Subject to any contrary provisions in the definition of Interest
Period, if any payment under this Agreement or any of the other Loan Documents
is specified to be made on a day which is not a Business Day, it shall be made
on the next Business Day, and such extension of time shall in such case be
included in computing interest and fees, if any, in connection with such
payment.
Section 2.10 Reimbursement.
(a) Whenever any Lender shall sustain or incur any losses or out-of-pocket
expenses in connection with (i) failure by the Borrower to borrow or reborrow
any Eurodollar Advance after having given notice of its intention to borrow or
reborrow in accordance with
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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 hereof)
or (ii) prepayment of any Eurodollar Advance in whole or in part for any reason,
the Borrower agrees to pay to such Lender, upon such Lender's demand, an amount
sufficient to compensate such Lender for all such losses and out-of-pocket
expenses. Such Lender's good faith determination of the amount of such losses or
out-of-pocket expenses, as set forth in writing and accompanied by calculations
in reasonable detail demonstrating the basis for its demand, shall be
presumptively correct.
(b) Losses subject to reimbursement hereunder shall include, without
limiting the generality of the foregoing, expenses incurred by any Lender or any
participant of such Lender permitted hereunder in connection with the
re-employment of funds prepaid, repaid, not borrowed or paid, as the case may
be.
Section 2.11 Pro Rata Treatment.
(a) Advances. Each Advance (other than a Swing Line Advance) shall be made
pro rata on the basis of the respective Commitment Ratios of the Lenders.
(b) Payments. Each payment and prepayment of principal of the Loans (other
than Swing Line Loans) and, except as provided in Article 10 hereof, each
payment of interest on the Loans (other than Swing Line Loans), shall be made to
the Lenders pro rata on the basis of their respective unpaid principal amounts
outstanding under the Facility A Commitment immediately prior to such payment or
prepayment. If any Lender shall obtain any payment (whether involuntary, through
the exercise of any right of set-off or otherwise) on account of the Loans made
by it in excess of its ratable share of the Loans based upon its Commitment
Ratio, such Lender shall forthwith purchase from the other Lenders such
participations in the Loans made by them as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and such Lender shall repay to the purchasing Lender the
purchase price to the extent of such recovery. The Borrower agrees that any
Lender so purchasing a participation from another Lender pursuant to this
Section 2.11(b) may, to the extent permitted by Applicable Law, exercise all its
rights of payment (including, without limitation, the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation. If the Swing Line
Lender shall obtain any payment (whether involuntary or otherwise) on account of
the Swing Line Loans in excess of the Swing Line Loans then outstanding and the
Swing Line Lender's share of any expenses, fees and other items due and payable
to it hereunder, the Swing Line Lender shall forthwith return such excess
payment to the Funding Agent for distribution among the Lenders based on the
provisions of this Section.
Section 2.12 Capital Adequacy. If after the date hereof, the adoption of
any Applicable Law regarding the capital adequacy of banks or bank holding
companies, or any change in Applicable Law (whether adopted before or after the
Agreement Date) or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by
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any Lender or the Swing Line Lender 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 any Lender's or the Swing Line Lender's capital
as a consequence of its obligations hereunder with respect to the Loans and the
Facility A Commitment or the Swing Line Loans and the Swing Line Commitment to a
level below that which it could have achieved but for such adoption, change or
compliance (taking into consideration any Lender's or the Swing Line Lender's
policies with respect to capital adequacy immediately before such adoption,
change or compliance and assuming that such Lender's or the Swing Line Lender's
capital was fully utilized prior to such adoption, change or compliance) by an
amount reasonably deemed by such Lender or the Swing Line Lender to be material,
then, upon demand by such Lender or the Swing Line Lender, the Borrower shall
promptly pay to such Lender or the Swing Line Lender such additional amounts as
shall be sufficient to compensate such Lender or the Swing Line Lender 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 Default Rate.
Notwithstanding the foregoing, the Borrower shall only be obligated to
compensate such Lender for any amount under this subsection arising or occurring
during, in the case of each such request for compensation, (i) any time or
period commencing not more than ninety (90) days prior to the date on which such
Lender submits such request, and (ii) any other time or period during which,
because of the unannounced retroactive application of such law, regulation,
interpretation, request or directive, such Lender could not have known that the
resulting reduction in return might arise. A certificate of such Lender or the
Swing Line Lender setting forth the amount to be paid to such Lender or the
Swing Line Lender by the Borrower as a result of any event referred to in this
paragraph and supporting calculations in reasonable detail shall be
presumptively correct.
Section 2.13 Lender Tax Forms. On or prior to the Agreement Date and on or
prior to the first (1st) Business Day of each calendar year thereafter, each
Lender which is organized in a jurisdiction other than the United States shall,
to the extent permissible under Applicable Law, provide the Funding Agent and
the Borrower with two (2) properly executed originals of Form 4224 or 1001 (or
any successor form) prescribed by the Internal Revenue Service or other
documents satisfactory to the Borrower and the Funding Agent and properly
executed Internal Revenue Service Form W-8 or W-9, as the case may be,
certifying (i) as to such Lender's status for purposes of determining exemption
from United States withholding taxes with respect to all payments to be made to
such Lender hereunder and under the Notes or (ii) that all payments to be made
to such Lender hereunder and under the Notes are subject to such taxes at a rate
reduced to zero by an applicable tax treaty. Each such Lender agrees to provide
the Funding 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 Funding Agent and the Borrower.
Section 2.14 Letters of Credit.
(a) Subject to the terms and conditions hereof, the Issuing Bank, on behalf
of the Lenders, and in reliance on the agreements of the Lenders set forth in
subsection (c) of this Section 2.14, hereby agrees to issue one (1) or more
Letters of Credit up to an aggregate face
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amount equal to the Available Letter of Credit Commitment; provided, however,
that the Issuing Bank shall not issue any Letter of Credit unless the conditions
precedent to the issuance thereof set forth in Sections 3.1 and 3.3 hereof have
been satisfied, and shall have no obligation to issue any Letter of Credit if
any Default then exists or would be caused thereby or if, after giving effect to
such issuance, the Available Facility A Commitment would be less than zero; and
provided further, however, that at no time shall the total Letter of Credit
Obligations outstanding hereunder exceed $25,000,000.00. Each Letter of Credit
shall (1) be denominated in U.S. dollars and (2) expire no later than the
earlier to occur of (A) five (5) Business Days prior to the Facility A Maturity
Date and (B) one (1) year after its date of issuance.
(b) The Borrower may from time to time request that the Issuing Bank issue
a Letter of Credit. The Borrower shall execute and deliver to the Funding Agent
and the Issuing Bank a Request for Issuance of Letter of Credit for each Letter
of Credit to be issued by the Issuing Bank, not later than 12:00 noon (New York
time) on the fifth (5th) Business Day preceding the date on which the requested
Letter of Credit is to be issued, or such shorter notice as may be acceptable to
the Issuing Bank and the Funding Agent. Upon receipt of any such Request for
Issuance of Letter of Credit, subject to satisfaction of all conditions
precedent thereto as set forth in Section 3.3 hereof, the Issuing Bank shall
process such Request for Issuance of Letter of Credit and the certificates,
documents and other papers and information delivered to it in connection
therewith in accordance with its customary procedures and shall promptly issue
the Letter of Credit requested thereby. The Issuing Bank shall, upon request,
furnish a copy of such Letter of Credit to any Lender following the issuance
thereof.
(c) Each Lender irrevocably authorizes the Issuing Bank to issue,
reconfirm, reissue and extend each Letter of Credit in accordance with the terms
of this Agreement. The Issuing Bank hereby sells, and each other Lender hereby
purchases, on a continuing basis, a participation and an undivided interest in
(A) the obligations of the Issuing Bank to honor any draws under the Letters of
Credit issued pursuant to this Agreement and (B) the Indebtedness of the
Borrower to the Issuing Bank under this Agreement and any reimbursement or
indemnification agreement relating to each Letter of Credit, such participation
being in the amount of such Lender's pro rata share of such obligations and
Indebtedness based on such Lender's Commitment Ratio.
(d) Upon receipt of a draw certificate from the beneficiary of a Letter of
Credit, the Issuing Bank shall promptly notify the Funding Agent and the Funding
Agent shall notify the Borrower and each Lender, by telephone or telecopy, of
the amount of the requested draw and, in the case of each Lender, such Lender's
portion of such draw amount as calculated in accordance with its Commitment
Ratio.
(e) The Borrower hereby agrees to immediately reimburse the Issuing Bank
for amounts paid by the Issuing Bank in respect of draws under a Letter of
Credit issued at the Borrower's request. In order to facilitate such repayment,
the Borrower hereby irrevocably requests the Lenders, and the Lenders hereby
severally agree, on the terms and conditions of this Agreement (other than as
provided in Article 2 hereof with respect to the amounts of, the timing of
requests for, and the repayment of Advances hereunder and in Article 3 hereof
with
34
respect to conditions precedent to Advances hereunder), with respect to any
drawing under a Letter of Credit prior to the occurrence of an event described
in clauses (f) or (g) of Section 8.1 hereof, to make an Advance (which Advance
may be a Eurodollar Advance if the Borrower so requests in a timely manner or
may be converted to a Eurodollar Advance as provided in this Agreement) to the
Borrower under the Facility A Commitment on each day on which a draw is made
under any Letter of Credit and in the amount of such draw, and to pay the
proceeds of such Advance directly to the Issuing Bank to reimburse the Issuing
Bank for the amount paid by it upon such draw. Each Lender shall pay its share
of such Advance by paying its portion of such Advance to the Funding Agent in
accordance with Section 2.2(e) hereof and its Commitment Ratio, without
reduction for any set-off or counterclaim of any nature whatsoever and
regardless of whether any Default (other than with respect to an event described
in clauses (f) or (g) of Section 8.1 hereof) then exists or would be caused
thereby. If at any time that any Letters of Credit are outstanding, any of the
events described in clauses (f) or (g) of Section 8.1 hereof shall have occurred
and be continuing, then each Lender shall, automatically upon the occurrence of
any such event and without any action on the part of the Issuing Bank, the
Borrower, the Agents or the Lenders, or any of them, be deemed to have purchased
an undivided participation in the face amount of all Letters of Credit then
outstanding in an amount equal to such Lender's Commitment Ratio times the face
amount of all Letters of Credit then outstanding, and each Lender shall,
notwithstanding such Event of Default, upon a drawing under any Letter of
Credit, immediately pay to the Funding Agent for the account of the Issuing
Bank, in immediately available funds, the amount of such Lender's participation
(and the Issuing Bank shall deliver to such Lender a loan participation
certificate dated the date of the occurrence of such event and in the amount of
such Lender's Commitment Ratio times the face amount of all Letters of Credit
then outstanding). The obligation of each Lender to make payments to the Funding
Agent, for the account of the Issuing Bank, in accordance with this Section 2.14
shall be absolute and unconditional and no Lender 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 Issuing Bank, as determined by
a final order of a court of competent jurisdiction. The Funding Agent shall
promptly remit to the Issuing Bank the amounts so received from the Lenders. Any
overdue amounts payable by the Lenders to the Issuing Bank in respect of a draw
under any Letter of Credit shall bear interest, payable on demand, at the
Federal Funds rate, plus one percent (1%).
(f) The Borrower agrees to reimburse the Lenders for any Advances made
pursuant to draws under any Letter of Credit, and each payment by the Borrower
in respect of its obligation to reimburse the Lenders under this Section 2.14
shall be made on the date of such Advance in lawful money of the United States
of America in immediately available funds. Any overdue amounts payable by the
Borrower under this Section 2.14 shall bear interest, payable on the earlier of
demand or the Facility A Maturity Date, for each day from and including the date
payment thereof was due to, but excluding, the date of actual payment, at the
Default Rate.
(g) The Borrower agrees that any action taken or omitted to be taken by the
Issuing 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 the Issuing Bank as determined by a final order of a court of competent
jurisdiction, shall be binding on the Borrower as between the
35
Borrower and the Issuing Bank, and shall not result in any liability of the
Issuing Bank to the Borrower. The obligation of the Borrower to reimburse the
Lenders for Advances made to reimburse the Issuing 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 other than to the extent such use,
action or omission is the result of the gross negligence or willful
misconduct of the Issuing Bank as determined by a final order of a court of
competent jurisdiction;
(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 Lender (other than the defense of
payment to such Lender 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 the Issuing Bank as determined by a
final order of a court of competent jurisdiction;
(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, except to the extent
such breach results from the gross negligence or willful misconduct of the
Issuing Bank as determined by a final order of a court of competent
jurisdiction;
(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, but excluding any irregularity
resulting from the gross negligence or willful misconduct of the Issuing
Bank as determined by a final order of a court of competent jurisdiction;
36
(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, provided that the same shall not be the
result of the gross negligence or willful misconduct of the Issuing Bank as
determined by a final order of a court of competent jurisdiction;
(x) Any act, error, neglect or default, omission, insolvency or
failure of business of any of the correspondents of the Issuing Bank,
provided that the same shall not have constituted the gross negligence or
willful misconduct of the Issuing Bank as determined by a final order of a
court of competent jurisdiction;
(xi) Any other circumstances arising from causes beyond the control of
the Issuing Bank;
(xii) Payment by the Issuing 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 the Issuing Bank
as determined by a final order of a court of competent jurisdiction; 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 willful
misconduct of the Issuing Bank or any Lender, as determined by a final
order of a court of competent jurisdiction.
(h) If any change in Applicable Law, any change in the interpretation or
administration thereof, or any change in compliance with Applicable Law by the
Issuing Bank or any Lender as a result of any official 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 Reserve System), special deposit, capital adequacy, assessment or other
requirements or conditions against letters of credit issued by the Issuing Bank
or against participations by any other Lender in the Letters of Credit or (ii)
impose on the Issuing Bank or any other Lender 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 the Issuing Bank or such Lender, as
the case may be, is to increase the cost to the Issuing Bank or such Lender 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 the Issuing Bank or such Lender to be material,
then, upon demand by the Issuing Bank or such Lender, the Borrower shall
promptly pay the Issuing Bank or such Lender, as the case may be, such
additional amount or amounts as shall be sufficient to compensate the Issuing
Bank or such Lender for such increased costs, together with interest on such
amount from the fourth (4th) day after the date of demand, until payment in full
thereof at the Default Rate. A certificate of the Issuing Bank or such Lender
setting forth the amount, and in reasonable detail the basis for the Issuing
Bank or
37
such Lender's determination of such amount, to be paid to the Issuing Bank or
such Lender by the Borrower as a result of any event referred to in this
paragraph shall be presumptively correct.
(i) Each Lender shall be responsible (to the extent not reimbursed by the
Borrower) for its pro rata share (based on such Lender's Commitment Ratio) of
any and all reasonable out-of-pocket costs, expenses (including, without
limitation, reasonable legal fees) and disbursements which may be incurred or
made by the Issuing 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, except that no Lender shall be liable to the Issuing
Bank for any portion of such out-of-pocket costs, expenses (including, without
limitation, reasonable legal fees) and disbursements from the gross negligence
or willful misconduct of the Issuing Bank, as determined by a final,
non-appealable judicial order of a court of competent jurisdiction. In the event
the Borrower shall fail to pay such expenses of the Issuing Bank within ten (10)
days after demand for payment by the Issuing Bank, each Lender shall thereupon
pay to the Issuing Bank its pro rata share (based on such Lender's Commitment
Ratio) of such expenses within five (5) days from the date of the Issuing Bank's
notice to the Lenders of the Borrower's failure to pay; provided, however, that
if the Borrower or any guarantor shall thereafter pay such expense, the Issuing
Bank will repay to each Lender the amounts received from such Lender hereunder.
(j) The Borrower agrees that each Prime Rate Advance by the Lenders to
reimburse the Issuing Bank for draws under any Letter of Credit, shall, for all
purposes hereunder, be deemed to be a Prime Rate Advance under the Facility A
Commitment to the Borrower and shall be payable and bear interest in accordance
with all other Loans to the Borrower.
(k) The Borrower, for itself and on behalf of each of its Subsidiaries,
will indemnify and hold harmless the Funding Agent, the Issuing Bank and each
other Lender and each of their respective employees, representatives, officers
and directors 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, without limitation,
reasonable attorneys' fees, but excluding taxes) which may be imposed on,
incurred by or asserted against the Funding Agent, the Issuing Bank or any such
other Lender in any way relating to or arising out of the issuance of a Letter
of Credit; provided, however, that the Borrower shall not be liable to the
Funding Agent, the Issuing Bank or any such Lender 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 Funding Agent, the Issuing Bank or such
Lender, as the case may be, as determined by a final order of a court of
competent jurisdiction. This Section 2.14 shall survive termination of this
Agreement.
(l) The Issuing Bank may resign as Issuing Bank upon sixty (60) days' prior
written notice to the Funding Agent, the Lenders and the Borrower. If the
Issuing Bank shall resign as Issuing Bank under this Agreement, then the
Borrower shall appoint from among the Lenders a successor issuer of Letters of
Credit, whereupon such successor issuer shall succeed to the rights, powers and
duties of the Issuing Bank, and the term "Issuing Bank" shall mean such
successor issuer effective upon such appointment. At the time such resignation
shall become
38
effective, the Borrower shall pay to the resigning Issuing Bank all accrued and
unpaid fees pursuant to Section 2.5(b)(i) hereof. The acceptance of any
appointment as the Issuing Bank hereunder by a successor Lender shall be
evidenced by an agreement entered into by such successor, in a form satisfactory
to the Borrower and the Funding Agent and, from and after the effective date of
such agreement, such successor Lender shall have all the rights and obligations
of the previous Issuing Bank under this Agreement and the other Loan Documents.
After the resignation of the Issuing Bank hereunder, the resigning Issuing Bank
shall remain a party hereto and shall continue to have all the rights and
obligations of a Issuing Bank under this Agreement and the other Loan Documents
with respect to Letters of Credit issued by it prior to such resignation, but
shall not be required to issue additional Letters of Credit. After any retiring
Issuing Bank's resignation as Issuing Bank, the provisions of this Agreement
relating to the Issuing Bank shall inure to its benefit as to any actions taken
or omitted to be taken by it (i) while it was Issuing Bank under this Agreement
or (ii) at any time with respect to Letters of Credit issued by such Issuing
Bank.
Section 2.15 Swing Line Loans.
(a) Swing Line Advances. Subject to and upon the terms and conditions set
forth herein, at any time and from time to time on and after the Agreement Date
and prior to the Facility A Maturity Date, the Borrower, prior to 12:00 p.m.
(noon) (New York, New York time) on the Business Day of funding any Swing Line
Advance, shall give to the Swing Line Lender an irrevocable written notice in
the form of a Request for Swing Line Advance or notice by telecopy followed
immediately by a Request for Swing Line Advance; provided, however, that the
failure by the Borrower to confirm any notice by telecopy with a Request for
Swing Line Advance shall not invalidate any notice so given; provided further
that in no case will the Swing Line Lender be required to fund such Request for
Swing Line Advance under the Swing Line Commitment if such funding would
increase the aggregate Swing Line Loans to an amount in excess of the Available
Swing Line Commitment or if aggregate amounts of all Facility A Loans, Swing
Line Loans and Letter of Credit Obligations outstanding would exceed the
Available Facility A Commitment.
(b) Prepayment and Repayment.
(i) Upon irrevocable prior written notice delivered to the Swing Line
Lender prior to 12:00 p.m. (noon) (New York, New York time) on the day of
payment under this Section, the Borrower may repay a Swing Line Advance. In
addition, upon demand of the Swing Line Lender, if such demand is delivered
prior to 11:00 a.m. (New York, New York time) on a Business Day, the
Borrower shall on the following Business Day make a repayment of the Swing
Line Loans then outstanding in the amount so requested by the Swing Line
Lender; provided, however, that if such demand is delivered to the Borrower
at or after 11:00 a.m. (New York, New York time) on a Business Day, the
Borrower shall on the second (2nd) Business Day following receipt of such
demand make such repayment. In order to facilitate repayment of the Swing
Line Loans, the Borrower hereby irrevocably requests the Lenders, and the
Lenders hereby severally agree, on the terms and conditions of this
Agreement (other than as provided in Article 2 hereof with respect to the
amounts of, the time of requests for and the repayment of
39
Advances hereunder and in Article 3 hereof with respect to conditions
precedent to Advances hereunder), with respect to Swing Line Loans
outstanding, upon request of the Swing Line Lender or the Borrower
(including, without limitation, after any Default or Event of Default, but
prior to the occurrence of an event described in clauses (f) or (g) of
Section 8.1 hereof), to make an Advance to the Borrower in the amount of
such outstandings and to pay the proceeds of such Advance directly to the
Funding Agent to reimburse the Swing Line Lender for the amount of the
Swing Line Loans then outstanding. Each Lender shall pay its share of such
Advance by paying its portion of such Advance to the Funding Agent in
accordance with Section 2.2(e) hereof and its Commitment Ratio, without
reduction for any set-off or counterclaim of any nature whatsoever and
regardless of whether any Default or Event of Default (other than with
respect to an event described in clauses (f) or (g) of Section 8.1 hereof)
then exists or would be caused thereby. If at any time that the Swing Line
Loans are outstanding, any of the events described in clauses (f) or (g) of
Section 8.1 hereof shall have occurred and be continuing, then each Lender
shall, automatically upon the occurrence of any such event and without any
action on the part of the Swing Line Lender, the Borrower, the Funding
Agent or the Lenders, or any of them, be deemed to have purchased an
undivided participation in the then outstanding principal amount of the
Swing Line Loans then outstanding in an amount equal to such Lender's
Commitment Ratio, times the principal amount of the Swing Line Loans then
outstanding, and each Lender shall, notwithstanding such Event of Default,
immediately pay to the Funding Agent for the account of the Swing Line
Lender, in immediately available funds, the amount of such Lender's
participation (and the Swing Line Lender shall deliver to such Lender a
written confirmation of such loan participation dated the date of the
occurrence of such event and in the amount of such Lender's Commitment
Ratio, times the principal amount of the Swing Line Loans then
outstanding). Notwithstanding any of the foregoing, the Borrower shall
repay in full any Swing Line Loan outstanding, together with accrued
interest thereon, on or before the tenth (10th) Business Day following the
date on which such Swing Line Loan was made.
(ii) If any payment under this Agreement or the Swing Line Note shall
be specified to be made upon a day which is not a Business Day, it shall be
made on the next succeeding day which is a 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.
(iii) The Borrower agrees to pay principal, interest, fees and all
other amounts due hereunder or under the Swing Line Note without set-off or
counterclaim or any deduction whatsoever and free clear of all taxes (other
than taxes based on the income of the Swing Line Lender), levies and
withholding.
(iv) If the Borrower is required by Applicable Law to deduct any taxes
from or in respect of any sum payable to the Swing Line Lender hereunder,
under the Swing Line Note or under any other Loan Document: (i) the sum
payable hereunder or thereunder, as applicable, shall be increased to the
extent necessary to provide that, after making all required deductions
(including, without limitation, deductions applicable to additional sums
payable under this Section 2.15(b)), the Swing Line Lender receives an
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amount equal to the sum it would have received had no such deductions been
made; (ii) the Borrower shall make such deductions from such sums payable
hereunder or thereunder, as applicable, and pay the amount so deducted to
the relevant taxing authority as required by Applicable Law; and (iii) the
Borrower shall provide the Swing Line Lender with evidence satisfactory to
the Swing Line Lender that such deducted amounts have been paid to the
relevant taxing authority. Before making any such deductions, the Swing
Line Lender shall designate a different lending office and shall take such
alternative courses of action if such designation or alternative courses of
action will avoid the need for such deductions and will not in the good
faith judgment of the Swing Line Lender be otherwise disadvantageous to the
Swing Line Lender.
(c) Interest Period; Interest and Payments on Swing Line Advances. Interest
on each Swing Line Advance shall be, at the option of the Borrower, either (i)
computed in the same manner as interest on each Prime Rate Advance, or (ii) such
rate as the Borrower and the Swing Line Lender shall agree upon, and in each
case, shall be payable on the same terms as interest on each Prime Rate Advance;
provided, however, that the Interest Period for any Swing Line Advance shall not
exceed ten (10) Business Days.
ARTICLE 3
Conditions Precedent
Section 3.1 Conditions Precedent to Effectiveness. The terms and conditions
of this Agreement shall become operative and effective upon fulfillment of each
of the following conditions:
(a) The Co-Administrative Agents shall have received each of the
following, in form and substance satisfactory to each of them:
(i) duly executed Facility A Notes;
(ii) duly executed Facility B Loan Agreement;
(iii) duly executed Borrower Pledge Agreement, together with
appropriate stock certificate and stock power;
(iv) duly executed VCOC Guaranty executed and delivered by VCOC;
(v) copies of insurance binders or certificates covering the
assets of the Borrower and its Subsidiaries and otherwise meeting the
requirements of Section 5.5 hereof;
(vi) legal opinions of (i) Richard C. Rowlenson, Executive Vice
President and General Counsel of Vanguard; (ii) Schell, Bray, Aycock,
Abel & Livingston,
41
North Carolina counsel; and (iii) Latham & Watkins, FCC counsel; each
as counsel to Vanguard, the Borrower and its Subsidiaries, addressed
to each Lender and the Co-Administrative Agents, and dated as of the
Agreement Date;
(vii) opinion of Powell, Goldstein, Frazer & Murphy LLP, special
counsel to the Co-Administrative Agents, addressed to the
Co-Administrative Agents and the Lenders and dated as of the Agreement
Date, and the Co-Administrative Agents hereby instruct such counsel to
deliver such opinion to the Funding Agent and the Lenders;
(viii) duly executed Certificate of Financial Condition for the
Borrower and its Subsidiaries on a consolidated basis, given by the
chief financial officer of the Borrower;
(ix) copies of the most recent quarterly and annual financial
statements of Vanguard and its Subsidiaries which have been provided
to each Lender pursuant to Sections 6.1 and 6.2 of the Prior Loan
Agreement, certified by the chief financial officer of the Borrower;
(x) any required FCC consents or other required consents to the
closing of this Agreement or to the execution, delivery and
performance of this Agreement and the other Loan Documents, each of
which shall be in form and substance satisfactory to the
Co-Administrative Agents and the Lenders;
(xi) the loan certificate of the Borrower, in substantially the
form of Exhibit H-1 attached hereto, including a certificate of
incumbency with respect to each Authorized Signatory, together with
appropriate attachments which shall include, without limitation, (A) a
copy of the Articles of Incorporation of the Borrower, certified to be
true, complete and correct by the North Carolina Secretary of State,
(B) certificates of good standing or foreign qualification for the
Borrower issued by the Secretary of State or similar state official
for each state in which the Borrower is required to qualify to do
business, (C) a true, complete and correct copy of the By-Laws of the
Borrower, as in effect on the Agreement Date, (D) a true, complete and
correct copy of the resolutions of the Borrower authorizing it to
execute, deliver and perform this Agreement and the other Loan
Documents and (E) a true, complete and correct copy of any
shareholders' agreements or voting trust agreements in effect with
respect to the stock of the Borrower;
(xii) the loan certificate of VCOC, in substantially the form of
Exhibit H-2 attached hereto, including a certificate of incumbency
with respect to each Authorized Signatory, together with appropriate
attachments which shall include, without limitation, (A) a copy of the
Certificate of Incorporation of VCOC, certified to be true, complete
and correct by the Delaware Secretary of State, (B) certificates of
good standing or foreign qualification for VCOC issued by the
Secretary of State or similar state official for each state in which
the Borrower is required to qualify to do business, (C) a true,
complete and correct copy of the By-Laws of VCOC, as in effect on the
Agreement Date, (D) a true,
42
complete and correct copy of the resolutions of VCOC authorizing it to
execute, deliver and perform this Agreement and the other Loan
Documents and (E) a true, complete and correct copy of any
shareholders' agreements or voting trust agreements in effect with
respect to the stock of VCOC;
(xiii) duly executed Vanguard Pledge Agreement, together with
appropriate stock certificate and stock power;
(xiv) duly executed Vanguard Guaranty;
(xv) a loan certificate of Vanguard, in substantially the form of
Exhibit H-3 attached hereto, including a certificate of incumbency
with respect to each authorized signatory of Vanguard, together with
appropriate attachments which shall include, without limitation, (A) a
copy of the Articles of Incorporation of Vanguard, certified to be
true, complete and correct by the North Carolina Secretary of State,
(B) certificates of good standing or foreign qualification for
Vanguard issued by the Secretary of State or similar state official
for each state in which Vanguard is required to qualify to do
business, (C) a true, complete and correct copy of the By-Laws of
Vanguard, as in effect on the Agreement Date, (D) a true, complete and
correct copy of the resolutions of Vanguard authorizing it to execute,
deliver and perform the Loan Documents to which it is a party and (E)
a true, complete and correct copy of any shareholders' agreements or
voting trust agreements in effect with respect to the stock of
Vanguard;
(xvi) UCC-1 lien and judgment search results with respect to the
Borrower, its Subsidiaries and Vanguard;
(xvii) duly executed Master Assignment and Assumption Agreement
dated as of the Agreement Date, among the Lenders hereunder and the
"Lenders" as defined in the Prior Loan Agreement; and
(xviii) all such other documents as either Co-Administrative
Agent or any Lender may reasonably request, certified by an
appropriate governmental official or an Authorized Signatory if so
requested.
(b) The Co-Administrative Agents and the Lenders shall have received
evidence satisfactory to them that all Necessary Authorizations, including
all necessary consents to the closing of this Agreement, have been obtained
or made, are in full force and effect and are not subject to any pending or
threatened reversal or cancellation and the Co-Administrative Agents and
the Lenders shall have received a certificate of an Authorized Signatory so
stating.
(c) The Co-Administrative Agents, the Lenders and Powell, Goldstein,
Frazer & Murphy LLP, special counsel to the Co-Administrative Agents, shall
have received payment of all fees due and payable on the Agreement Date,
together with a payment of all principal, accrued but unpaid interest and
fees outstanding under the Prior Loan Agreement.
43
(d) There shall have occurred no Materially Adverse Effect.
(e) Each of the Co-Administrative Agents and the Lenders shall have
received a Performance Certificate setting forth, as of the Agreement Date,
on a pro forma basis the arithmetic calculations required to establish
whether or not the Borrower is in compliance with the requirements set
forth in Sections 7.8, 7.9, 7.10 and 7.11 hereof.
Section 3.2 Conditions Precedent to Each Advance. The obligation of the
Lenders to make each Advance and the Swing Line Lender to make a Swing Line
Advance is subject to the fulfillment of each of the following conditions
immediately prior to or contemporaneously with such Advance or Swing Line
Advance:
(a) All of the representations and warranties 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 or Swing Line Advance, shall be true and correct
at such time in all material respects, both before and after giving effect
to the application of the proceeds of such Advance or Swing Line Advance
and after giving effect to any updates to information provided to the
Lenders in accordance with the terms of such representations and warranties
and no Default shall then exist or be caused thereby;
(b) With respect to Advances which, if funded, would increase the
aggregate principal amount of Loans outstanding hereunder, the Funding
Agent shall have received a duly executed Request for Advance or Request
for Swing Line Advance, as applicable;
(c) Each of the Co-Administrative Agents and the Lenders shall have
received all such other certificates, reports, statements, opinions of
counsel or other documents as the Co-Administrative Agents or any Lender
may reasonably request; and
(d) There shall have occurred no Materially Adverse Effect.
The acceptance of the proceeds of any Loans which would increase the aggregate
dollar amount of the Loans outstanding shall be deemed to be a representation
and warranty by the Borrower as to compliance with this Section 3.2 on the date
any such Loan is made.
Section 3.3 Conditions Precedent to Issuance of Letters of Credit. The
obligation of the Issuing Bank to issue each Letter of Credit hereunder is
subject to the fulfillment of each of the following conditions immediately prior
to or contemporaneously with such issuance:
(a) All of the representations and warranties 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 the issuance of such Letter of Credit, shall be true and
correct at such time, both before and after giving effect to
44
the issuance of such Letter of Credit, and after giving effect to any
updates to information provided to the Lenders in accordance with the terms
of such representations and warranties;
(b) 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
Funding Agent shall have received a Request for Issuance of a Letter of
Credit so certifying;
(c) Each of the Co-Administrative Agents, the Issuing Bank and each of
the Lenders shall have received all such other certificates, reports,
statements, opinions of counsel or other documents as any of them may
reasonably request; and
(d) There shall have occurred no Materially Adverse Effect.
ARTICLE 4
Representations and Warranties
Section 4.1 Representations and Warranties. The Borrower hereby agrees,
represents and warrants in favor of each Agent and each Lender that:
(a) Organization; Ownership; Power; Qualification. The Borrower is a
corporation duly organized, validly existing and in good standing under the
laws of the state of its incorporation. 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. The Borrower's sole
shareholder is Vanguard. Each Subsidiary of the Borrower is a corporation
or partnership, as applicable, duly organized, validly existing and in good
standing under the laws of the state of its formation and has the corporate
or partnership power, as applicable, and authority 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; Enforceability. The Borrower has the corporate
power and has taken all necessary corporate action to authorize it to
borrow hereunder, to execute, deliver and perform this Agreement and each
of the other Loan Documents to which it is a party in accordance with their
respective terms and to consummate the transactions contemplated hereby and
thereby. This Agreement has been duly executed and delivered by the
Borrower and is, and each of the other Loan Documents to which the Borrower
is party is, a legal, valid and binding obligation of the Borrower
enforceable against the Borrower in accordance with its terms, subject, as
to enforcement of remedies, to the following qualifications: (i) 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 and (ii) enforcement may be limited by bankruptcy,
insolvency, liquidation, reorganization, reconstruction and other similar
laws affecting
45
enforcement of creditors' rights generally (insofar as any such law relates
to the bankruptcy, insolvency or similar event of the Borrower).
(c) Subsidiaries: Authorization; Enforceability. The Borrower's
Subsidiaries, the VCS Subsidiary and the Unrestricted Subsidiaries and the
Borrower's direct and indirect ownership thereof are as set forth as of the
Agreement Date on Schedule 4 attached hereto and the Borrower has the
unrestricted right to vote the issued and outstanding ownership interests
of the Subsidiaries shown thereon; such ownership interests of such
Subsidiaries and the Unrestricted Subsidiaries have been duly authorized
and issued and are fully paid and nonassessable. Each Subsidiary of the
Borrower has the corporate or partnership power 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 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 and (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).
(d) Compliance with Other Loan Documents and Contemplated
Transactions. The execution, delivery and performance, in accordance with
their respective terms, by the Borrower of this Agreement and the Notes,
and by the Borrower and its Subsidiaries of each of the other Loan
Documents to which they are respectively party, and the consummation of the
transactions contemplated hereby and thereby, do not and will not (i)
require any consent or approval, governmental or otherwise, not already
obtained, (ii) violate any Applicable Law respecting the Borrower or any
Subsidiary of the Borrower, (iii) conflict with, result in a breach of, or
constitute a default under the certificate or articles of incorporation or
by-laws, as amended, of the Borrower or of any Subsidiary of the Borrower,
or under any indenture, agreement, or other instrument, including, without
limitation, the Licenses, to which the Borrower or any of its Subsidiaries
is a party or by which any of them or any of their respective 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, together with its Subsidiaries, is
primarily engaged in the business of owning, operating and investing in
Cellular Systems and other wireless communications and related businesses.
(f) Licenses; Necessary Authorizations. The Licenses have been duly
authorized by the grantors thereof and are in full force and effect. The
Borrower and its Subsidiaries are in compliance in all material respects
with all of the provisions thereof. The Borrower and its Subsidiaries have
secured all Necessary Authorizations and all such Necessary
46
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 revocation.
(g) Compliance with Law. The Borrower and its Subsidiaries, the VCS
Subsidiary and the Unrestricted Subsidiaries are in substantial compliance
with all material Applicable Law.
(h) Title to Assets. The Borrower has good, legal and marketable title
to, or a valid leasehold interest in, all of its assets. Each of the
Borrower's Subsidiaries has good, legal and marketable title to, or a valid
leasehold interest in, all of its assets. None of such properties or assets
is subject to any Liens, except for Permitted Liens. Except for financing
statements evidencing Permitted Liens, no financing statement under the
Uniform Commercial Code as in effect in any jurisdiction and no other
filing which names the Borrower or any of its Subsidiaries as debtor or
which covers or purports to cover any of the assets of the Borrower or any
of its Subsidiaries is currently effective and on file in any state or
other jurisdiction, and neither the Borrower nor any of its Subsidiaries
has signed any such financing statement or filing or any security agreement
authorizing any secured party thereunder to file any such financing
statement or filing.
(i) Litigation. Except for the litigation disclosed in Schedule 5
attached hereto, there is no pending or threatened action or proceeding
affecting the Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator which is reasonably likely to have a
Materially Adverse Effect or which purports to affect this Agreement or the
transactions contemplated hereby.
(j) Taxes. All federal, state and other tax returns of the Borrower,
each of its Subsidiaries, the VCS Subsidiary and each Unrestricted
Subsidiary required by law to be filed have been duly filed and all
federal, state and other taxes, including, without limitation, withholding
taxes, assessments and other governmental charges or levies required to be
paid by the Borrower, any of its Subsidiaries, the VCS Subsidiary or any
Unrestricted Subsidiary or imposed upon the Borrower, any of its
Subsidiaries, the VCS Subsidiary or any Unrestricted Subsidiary or any of
their respective properties, income, profits or assets, which are due and
payable, have been paid, except any such taxes (i) (x) the payment of which
the Borrower, any of its Subsidiaries, the VCS Subsidiary or any
Unrestricted Subsidiary is diligently contesting in good faith by
appropriate proceedings, (y) for which adequate reserves have been provided
on the books of the Borrower or the Subsidiary of the Borrower or the VCS
Subsidiary or Unrestricted Subsidiary involved in accordance with GAAP and
(z) as to which no Lien other than a Permitted Lien has attached and no
foreclosure, distraint, sale or similar proceedings have been commenced, or
(ii) which may result from audits not yet conducted. The charges, accruals
and reserves on the books of the Borrower, each of its Subsidiaries, the
VCS Subsidiary and of each Unrestricted Subsidiary 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 Co-Administrative Agents and the Lenders a Form 10-K for
Vanguard and its Subsidiaries on a consolidated basis for the fiscal year
ended December 31, 1996 and audited
47
financial statements for the fiscal year ended December 31, 1996, all of
which, together with other financial statements furnished to the Lenders
subsequent to the Agreement Date are, to the best knowledge of the
Borrower, complete and correct in all material respects and present fairly
in accordance with GAAP the financial condition of Vanguard and its
Subsidiaries on a consolidated basis on and as at such dates and the
results of operations for the periods then ended (subject, in the case of
unaudited financial statements, to normal year-end adjustments). Neither
the Borrower nor any of its Subsidiaries has any material liabilities,
contingent or otherwise, other than as disclosed in the financial
statements referred to in the preceding sentence or as set forth or
referred to in this Agreement, and there are no material unrealized losses
of the Borrower or any of its Subsidiaries and no anticipated losses of the
Borrower or any of its Subsidiaries other than those which have been
previously disclosed in writing to the Funding Agent and the Lenders and
identified as such.
(l) No Adverse Change. Since December 31, 1996, there has occurred no
event which has had or which could have a Materially Adverse Effect.
(m) ERISA. The Borrower and each Subsidiary of the Borrower and each
of their respective Plans are in compliance with ERISA and the Code and
neither the Borrower nor any of its Subsidiaries has incurred any
accumulated funding deficiency with respect to any such Plan within the
meaning of ERISA or the Code. The Borrower, each of its Subsidiaries, and
each other ERISA Affiliate have complied with all requirements of Section
4980B of the Code and Sections 601 through 609 of ERISA. Neither the
Borrower nor any of its Subsidiaries has made any promises of retirement or
other benefits to employees, except as set forth in their respective Plans,
in written agreements with such employees, or in the Borrower's employee
handbook and memoranda to employees. Neither the Borrower nor any of its
Subsidiaries has incurred any material liability to PBGC in connection with
any such Plan. The assets of each such Plan which is subject to Title IV of
ERISA are sufficient to provide the benefits under such Plan, the payment
of which PBGC would guarantee if such Plan were terminated, and such assets
are also sufficient to provide all other "benefit liabilities" (as defined
in Section 4041 of ERISA) due under such Plan upon termination. No
Reportable Event has occurred and is continuing with respect to any such
Plan. No such Plan or trust created thereunder, or party in interest (as
defined in Section 3(14) of ERISA), or any fiduciary (as defined in Section
3(21) of ERISA), has engaged in a "prohibited transaction" (as such term is
defined in Section 406 of ERISA or Section 4975 of the Code) which would
subject such Plan or any other Plan of the Borrower or any of its
Subsidiaries, any trust created thereunder, or any such party in interest
or fiduciary, or any party dealing with any such Plan or any such trust, to
the tax or penalty on "prohibited transactions" imposed by Section 502 of
ERISA or Section 4975 of the Code. Neither the Borrower nor any of its
Subsidiaries is a participant in or is obligated to make any payment to a
Multiemployer Plan. Neither the Borrower nor any of its Subsidiaries (1)
has had either a complete withdrawal or a partial withdrawal under Section
4201 et. seq. of ERISA from a Multiemployer Plan which had "unfunded vested
benefits" within the meaning of Section 4211 of ERISA or (2) has ever
received a notice and demand from the plan sponsor of a Multiemployer Plan
under Section 4219(b)(1) of ERISA. For purposes of this Section 4.1(m), the
term "Subsidiaries" shall include the VCS Subsidiary and the Unrestricted
Subsidiaries.
48
(n) Compliance with Regulations G, T, U and X. Neither the Borrower
nor any Subsidiary of the Borrower nor any Unrestricted Subsidiary is
engaged principally in or has as one of its important activities the
business of purchasing or carrying, or extending credit for the purpose of
purchasing or carrying, any margin stock within the meaning of Regulations
G, T, U and X of the Board of Governors of the Federal Reserve System; nor
will any proceeds of the Loans be used for such purpose, other than
Investments in Geotek Communications, Inc., a Delaware corporation, made
prior to the Agreement Date in compliance with the provisions of such
Regulations G, T, U and X. Not more than twenty-five percent (25%) (or such
greater percentage as provided in the exclusions from the definition of
"indirectly secured" contained in such Regulations G, T, U and X in effect
at the time of the making of such Advance) of the value of the assets of
the Borrower and its Subsidiaries is derived from assets constituting
margin stock.
(o) Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is required to register under the provisions of the Investment
Company Act of 1940, as amended, and neither the entering into or
performance by the Borrower and its Subsidiaries of this Agreement nor the
issuance of the Notes violates any provision of such Act or requires any
consent, approval or authorization of, or registration with, the Securities
and Exchange Commission or any other governmental or public body or
authority pursuant to any provisions of such Act.
(p) Governmental Regulation. Neither the Borrower nor any of its
Subsidiaries is required to obtain any consent, approval, authorization,
permit or license which has not already been obtained from, or effect any
filing or registration which has not already been effected with, any
federal, state or local regulatory authority in connection with the
execution and delivery of this Agreement. Neither the Borrower nor any of
its Subsidiaries is required to obtain any consent, approval,
authorization, permit or license which has not already been obtained from,
or effect any filing or registration which has not already been effected
with, any federal, state or local regulatory authority in connection with
the performance, in accordance with their respective terms, of this
Agreement or any other Loan Document.
(q) Absence of Default; etc. The Borrower and its Subsidiaries are in
compliance in all respects with all of the provisions of their respective
Certificates or Articles of Incorporation, By-Laws and Partnership
Agreements, and no event has occurred or failed to occur (including,
without limitation, any matter which could create a Default by
cross-default) which has not been remedied or waived, the occurrence or
non-occurrence of which constitutes, or with the passage of time or giving
of notice or both would constitute, (i) an Event of Default or (ii) a
material default by the Borrower or any of its Subsidiaries under any
indenture, agreement or other instrument relating to Indebtedness of the
Borrower or any of its Subsidiaries in the amount of $ 1,000,000.00 or
more, any License, or any judgment, decree or order to which the Borrower
or any of its Subsidiaries is a party or by which the Borrower or any of
its Subsidiaries or any of their respective properties may be bound or
affected. Neither the Borrower nor any of its Subsidiaries is a party to or
bound by any contract or agreement continuing after the Agreement Date, or
is bound by any Applicable Law, that could have a Materially Adverse Effect
or result in the loss of any License issued by the FCC.
49
(r) Accuracy and Completeness of Information. All information,
reports, prospectuses and other papers and data relating to the Borrower or
any of its Subsidiaries, any Unrestricted Subsidiary or the VCS Subsidiary
and furnished by or on behalf of the Borrower or any of its Subsidiaries,
any Unrestricted Subsidiary or the VCS Subsidiary to the Co-Administrative
Agents or the Lenders were, at the time furnished, true, complete and
correct in all material respects to the extent necessary to give the
Co-Administrative Agents and the Lenders true and accurate knowledge of the
subject matter. No fact or situation is currently known to the Borrower
which has had or which could reasonably be expected to have a Materially
Adverse Effect.
(s) Agreements with Affiliates and Management Agreements. Except as
set forth as of the Agreement Date on Schedule 6 attached hereto, and
except for agreements or arrangements with Affiliates wherein the Borrower
or one (1) or more of its Subsidiaries provides services to such Affiliates
for fair consideration, neither the Borrower nor any of its Subsidiaries
has (i) any written agreements or binding arrangements of any kind with any
Affiliate (other than the Borrower or any of its Subsidiaries) or (ii) any
management or consulting agreements of any kind with any Affiliate (other
than the Borrower or any of its Subsidiaries), other than employment
agreements.
(t) Payment of Wages. The Borrower and each of its Subsidiaries are in
compliance with the Fair Labor Standards Act, as amended, in all material
respects, and the Borrower and each of its Subsidiaries have paid all
minimum and overtime wages required by law to be paid to their respective
employees.
(u) Priority. The Security Interest is a valid and perfected first
priority security interest in the Collateral in favor of the Collateral
Agent, for the benefit of itself and the Lenders, securing, in accordance
with the terms of the Security Documents, the outstanding Obligations, and
the Collateral is subject to no Liens other than Permitted Liens. The Liens
created by the Security Documents are enforceable as security for the
outstanding Obligations in accordance with their terms with respect to the
Collateral subject, as to enforcement of remedies, to the following
qualifications: (i) 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 and (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, as
the case may be).
(v) Indebtedness. Except as shown on the audited financial statements
of Vanguard and its Subsidiaries for the fiscal year ended December 31,
1996, and except for the Advances and Guaranties hereunder, neither the
Borrower nor any of its Subsidiaries has outstanding, as of the Agreement
Date, any Indebtedness for Money Borrowed.
(w) Investments. All Investments of the Borrower and its Subsidiaries
are shown as of the Agreement Date on Schedule 7 attached hereto.
50
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 and on the
date of each Advance and issuance of each Letter of Credit except to the extent
relating specifically to an earlier date or time period. All representations and
warranties made under this Agreement shall survive, and not be waived by, the
execution hereof by the Lenders and the Agents, any investigation or inquiry by
any Lender or any Agent, or the making of any Advance under this Agreement.
ARTICLE 5
General Covenants
So long as any of the Obligations is outstanding and unpaid or the Borrower
shall have the right to borrow hereunder (whether or not the conditions to
borrowing have been or can be fulfilled), and unless the Majority Lenders, or
such greater number of Lenders as may be expressly provided herein, shall
otherwise consent in writing:
Section 5.1 Preservation of Existence and Similar Matters. The Borrower
will, and will cause each of its Subsidiaries to:
(i) preserve and maintain its existence, rights, franchises, licenses
and privileges in the state of its incorporation, including, without
limiting the foregoing, the Licenses and all other Necessary
Authorizations; and
(ii) qualify and remain qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature of
its business requires such qualification or authorization.
Section 5.2 Business; Compliance with Applicable Law. The Borrower will,
and will cause each of its Subsidiaries to, (a) engage primarily in the business
of owning, operating and investing in Cellular Systems and other wireless
communications and related businesses and (b) comply with the requirements of
all Applicable Law. The Borrower will cause each Unrestricted Subsidiary and the
VCS Subsidiary to comply in all material respects with the requirements of all
Applicable Law.
Section 5.3 Maintenance of Properties. The Borrower will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in the ordinary
course of business in good repair, working order and condition (reasonable wear
and tear excepted) all properties used in their respective businesses (whether
owned or held under lease), other than obsolete equipment or unused assets and
from time to time make or cause to be made all needed and appropriate repairs,
renewals, replacements, additions, betterments and improvements thereto.
Section 5.4 Accounting Methods and Financial Records. The Borrower will,
and will cause each of its Subsidiaries on a consolidated basis with the
Borrower to, and will cause the
51
Unrestricted Subsidiaries separately to, maintain a system of accounting
established and administered in accordance with GAAP, keep adequate records and
books of account in which complete entries will be made in accordance with GAAP
and reflecting all transactions required to be reflected by GAAP and keep
accurate and complete records of their respective properties and assets. The
Borrower and its Subsidiaries will maintain a fiscal year ending on December 31.
Section 5.5 Insurance. The Borrower will, and will cause each of its
Subsidiaries and the Unrestricted Subsidiaries to:
(a) Maintain insurance including, but not limited to, business
interruption coverage and public liability coverage insurance from
responsible companies in such amounts and against such risks to the
Borrower and each of its Subsidiaries and the Unrestricted Subsidiaries as
is prudent and reasonably acceptable to the Co-Administrative Agents
(including, without limitation, larceny, embezzlement or other criminal
misappropriation insurance).
(b) Keep their respective assets insured by insurers on terms and in a
manner reasonably acceptable to the Co-Administrative Agents against loss
or damage by fire, theft, burglary, loss in transit, explosions and hazards
insured against by extended coverage, in amounts which are prudent for the
cellular telephone and wireless communications industry and reasonably
satisfactory to the Co-Administrative Agents, all premiums thereon to be
paid by the Borrower and its Subsidiaries and the Unrestricted
Subsidiaries.
(c) Require that each insurance policy relating to the Borrower or any
of its Subsidiaries provide for at least thirty (30) days' prior written
notice (ten (10) days for cancellation from nonpayment) to the Collateral
Agent of any termination of or proposed cancellation or nonrenewal of such
policy, and name the Collateral Agent as additional named loss payee and
additional insured to the extent of the Obligations.
Section 5.6 Payment of Taxes and Claims. The Borrower will, and will cause
each of its Subsidiaries, the VCS Subsidiary and each Unrestricted Subsidiary
to, pay and discharge all taxes, including, without limitation, withholding
taxes, assessments and governmental charges or levies required to be paid by
them or imposed upon them or their income or profits or upon any properties
belonging to them, prior to the date on which penalties attach thereto, and all
lawful claims for labor, materials and supplies which, if unpaid, might become a
Lien or charge upon any of their properties; except that no such tax,
assessment, charge, levy or claim need be paid which is being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on the appropriate books in accordance with
GAAP, but only so long as such tax, assessment, charge, levy or claim does not
become a Lien or charge other than a Permitted Lien and no foreclosure,
distraint, sale or similar proceedings shall have been commenced. The Borrower
will, and will cause each of its Subsidiaries, the VCS Subsidiary and each
Unrestricted Subsidiary 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 any of the Agents and any of
the Lenders, upon
52
reasonable notice, to (i) visit and inspect the properties of the Borrower or
any of its Subsidiaries during business hours, (ii) inspect and make extracts
from and copies of their respective books and records and (iii) discuss with
their respective principal officers their respective businesses, assets,
liabilities, financial condition, results of operations and business prospects.
The Borrower and each of its Subsidiaries will also permit representatives of
any of the Agents and any of the Lenders to discuss with their respective
auditors their respective businesses, assets, liabilities, financial condition,
results of operations and business prospects.
Section 5.8 Payment of Indebtedness; Loans. Subject to any provisions
herein or in any other Loan Document, the Borrower will, and will cause each of
its Subsidiaries to, pay any and all of their respective Indebtedness when and
as it becomes due, other than (i) amounts diligently disputed in good faith and
for which adequate reserves have been set aside in accordance with GAAP and (ii)
trade payables, which shall be paid in a manner consistent with past practice.
Section 5.9 Use of Proceeds. The Borrower will use the aggregate proceeds
of all Advances (i) to refinance existing Indebtedness for Money Borrowed, (ii)
to fund Capital Expenditures, (iii) to acquire Cellular Systems and to make
Investments and Acquisitions as permitted hereunder and (iv) for working capital
and other general corporate purposes. No proceeds of Advances hereunder shall be
used for the purpose of purchasing or carrying or 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 other than Investments in Geotek Communications, Inc., a Delaware
corporation, permitted hereunder, made prior to the Agreement Date, in
compliance with the provisions of such Regulations G, T, U and X.
Section 5.10 Payment of Wages. The Borrower and each of its Subsidiaries
shall at all times comply, in all material respects, with the requirements of
the Fair Labor Standards Act, as amended, including, without limitation, the
provisions of such Act relating to the payment of minimum and overtime wages as
the same may become due from time to time.
Section 5.11 Indemnity. The Borrower, for itself and on behalf of each of
its Subsidiaries agrees, jointly and severally, to indemnify and hold harmless
the Swing Line Lender, each Lender and each Agent, and each of their respective
affiliates, employees, representatives, officers and directors (any of the
foregoing shall be an "Indemnitee") from and against any and all claims,
liabilities, obligations, losses, damages, penalties, actions, attorneys' fees
and expenses (as such fees and expenses are incurred), and other expenses
(including, without limitation, fees and expenses of experts, agents and
consultants) and demands by any party, including the costs of investigating and
defending such claims, whether or not the Borrower, any Subsidiary or the Person
seeking indemnification is the prevailing party: (a) resulting from any breach
or alleged breach by the Borrower or any Subsidiary of the Borrower of any
representation or warranty made hereunder or under any other Loan Document; (b)
arising out of (i) the Facility A Commitment or otherwise under this Agreement
or under any other Loan Document or any Letter of Credit, including the use of
the proceeds of Loans hereunder in any fashion by the Borrower or the
performance of their respective obligations under the Loan Documents by the
Borrower or
53
any of its Subsidiaries, (ii) allegations of any participation by the Swing Line
Lender, the Lenders or the Agents, or any of them, in the affairs of the
Borrower or any of its Subsidiaries, any Unrestricted Subsidiary or the VCS
Subsidiary, or allegations that any of them has any joint liability with the
Borrower or any of its Subsidiaries, any Unrestricted Subsidiary or the VCS
Subsidiary for any reason, or (iii) any claims against the Swing Line Lender,
the Lenders or the Agents, or any of them, by any shareholder or other investor
in or lender to the Borrower or any Subsidiary of the Borrower, by any brokers
or finders or investment advisers or investment bankers retained by the Borrower
or by any other third party, arising out of the Facility A Commitment or
otherwise under this Agreement; or (c) in connection with taxes, fees and other
charges payable in connection with the Loans, or the execution, delivery and
enforcement of this Agreement, the Security Documents and the other Loan
Documents, and any amendments thereto or waivers of any of the provisions
thereof, except to the extent that the Person seeking indemnification hereunder
is determined in such case to have acted in breach hereof (in such a manner as
to give rise to the claims, liabilities, obligations, losses, damages,
penalties, actions, attorneys' fees and expenses and other expenses and demands
for which indemnification is being sought) or with gross negligence or willful
misconduct, in any case, by a final, non-appealable judicial order of a court of
competent jurisdiction. The obligations of the Borrower and the Subsidiaries
under this Section 5.11 are in addition to, and shall not otherwise limit, any
liabilities which the Borrower or any Subsidiary might otherwise have in
connection with any warranties or similar obligations of the Borrower in any
other agreement or instrument or for any other reason.
Section 5.12 Interest Rate Hedging. The Borrower shall enter into, and
shall maintain during the term of this Agreement, one or more Interest Rate
Hedge Agreements which shall provide interest rate protection on terms
reasonably acceptable to the Co-Administrative Agents and the Syndication Agent,
such terms to include consideration of the creditworthiness of the other party
to the proposed Interest Rate Hedge Agreement. All obligations of the Borrower
to any of the Agents or any of the Lenders or any affiliate of any such Lender
pursuant to any Interest Rate Hedge Agreement shall rank pari passu with all
other Obligations.
ARTICLE 6
Information Covenants
So long as any of the Obligations is outstanding and unpaid or the Borrower has
a right to borrow hereunder (whether or not the conditions to borrowing have
been or can be fulfilled) and unless the Majority Lenders shall otherwise
consent in writing, the Borrower will furnish or cause to be furnished to each
Lender and each Co-Administrative Agent, at their respective offices:
Section 6.1 Quarterly Financial Statements and Information. Within
forty-five (45) days after the last day of each of the first three (3) quarters
of each fiscal year of the Borrower, (a) for Vanguard and its Subsidiaries and
the VCS Subsidiary on a consolidated basis, a balance sheet as at the end of
such quarter and as of the end of the preceding fiscal year, and the related
statements of operations for such quarter and the elapsed portion of the year
ended with the last day of such quarter and the related statements of cash flows
for the elapsed portion of the year
54
ended with the last day of such quarter, and (b) for each Unrestricted
Subsidiary, a balance sheet as at the end of such quarter and as of the end of
the preceding fiscal year, and the related statements of cash flows for the
elapsed portion of the year ended with the last day of such quarter, each of
which shall set forth in comparative form such figures as at the end of and for
such quarter and appropriate prior period, to the extent set forth in Vanguard's
Form 10-Q as filed with the Securities and Exchange Commission for such quarter,
and shall be certified by the chief financial officer of the Borrower, to be, in
his or her opinion, complete and correct in all material respects and to present
fairly, in accordance with GAAP, the financial condition of Vanguard on a
consolidated basis with its Subsidiaries and the VCS Subsidiary, and each
Unrestricted Subsidiary, as applicable, 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. Within ninety (90)
days after the end of each fiscal year of the Borrower, (a) for Vanguard and its
Subsidiaries and the VCS Subsidiary on a consolidated basis an audited balance
sheet, as of the end of such fiscal year and the related audited statements of
operations for such fiscal year and for the previous two (2) fiscal years, the
related audited statements of changes in shareholders' equity for such fiscal
year and for the previous two (2) fiscal years, and related audited statements
of cash flows of such fiscal year and for the previous two (2) fiscal years, and
(b) for the Unrestricted Subsidiaries individually, or on a consolidated basis
with each other, an audited balance sheet as of the end of such fiscal year and
the related audited statements of operations for such fiscal year and for the
previous two (2) fiscal years, if available, the related audited statements of
changes in shareholders' equity for such fiscal year and for the previous two
(2) fiscal years, if available, and the related audited cash flows for such
fiscal year and for the previous two (2) fiscal years, if available, each of
which shall be accompanied by an unqualified opinion of Arthur Andersen & Co. or
other independent certified public accountants of recognized national standing
acceptable to the Co-Administrative Agents.
Section 6.3 Performance Certificates. At the time the financial statements
are furnished pursuant to Sections 6.1 and 6.2 hereof, a certificate of the
president or chief financial officer of the Borrower as to its financial
performance, in substantially the form of Exhibit I attached hereto:
(a) setting forth as and at the end of such quarterly period or fiscal
year, as the case may be, the arithmetical calculations required to
establish (i) any interest rate adjustment, as provided for in Section
2.3(f) hereof and (ii) whether or not the Borrower was in compliance with
the requirements of Sections 7.7, 7.8, 7.9, 7.10 and 7.11 hereof;
(b) setting forth on a consolidated basis for the Borrower and its
Subsidiaries for each such fiscal quarter (i) the number of cellular
telephone subscribers at the beginning of the quarter, (ii) the number of
gross new cellular telephone subscribers added and deactivated cellular
telephone subscribers lost during the quarter and (iii) the number of
cellular telephone subscribers at the end of the quarter;
55
(c) stating that, to the best of his or her knowledge, no Default has
occurred as at the end of such quarterly period or year, as the case may
be, or, if a Default has occurred, disclosing each such Default and its
nature, when it occurred, whether it is continuing and the steps being
taken by the Borrower with respect to such Default; and
(d) summarizing the nature and individual and aggregate dollar amounts
of all Investments and Acquisitions made by the Borrower or any of its
Subsidiaries since the Agreement Date and stating that each such Investment
or Acquisition was made in accordance with the terms and conditions set
forth in Section 7.6 hereof.
Section 6.4 Copies of Other 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 hereof.
(b) Promptly upon receipt thereof, copies of any material adverse notice or
report regarding any License from the FCC.
(c) From time to time and promptly upon each request, such data,
certificates, reports, statements, opinions of counsel prepared for the Agents
and the Lenders, or any of them, documents or further information regarding the
business, assets, liabilities, financial condition, projections, results of
operations or business prospects of the Borrower or any of its Subsidiaries, any
Unrestricted Subsidiary or the VCS Subsidiary, as any Agent or any Lender may
reasonably request.
(d) Annually, a certificate of insurance indicating that the requirements
of Section 5.5 hereof remain satisfied for such fiscal year.
(e) Promptly following the making of any Investment or Acquisition having
an aggregate value of $2,000,000.00 or more by the Borrower or any of its
Subsidiaries, a brief description, including the nature and dollar amount, of
such Investment or Acquisition, together with a certificate of an Authorized
Signatory stating that such Investment or Acquisition was made in accordance
with the terms and conditions set forth in Section 7.6 hereof.
(f) Promptly following the filing thereof, any filings made by Vanguard
with the SEC or any reports provided by Vanguard to its shareholders.
Section 6.5 Notice of Litigation and Other Matters. Notice specifying the
nature and status of any of the following events, promptly, but in any event not
later than ten (10) days after any officer of the Borrower becomes aware of the
occurrence of any of the following events:
(i) the commencement of all proceedings and investigations by or
before any governmental body and all actions and proceedings in any court
or before any
56
arbitrator in which the recovery sought against the Borrower or any of its
Subsidiaries is greater than or equal to $1,000,000.00, or which, to the
extent known to the Borrower, in any other way relate materially adversely
to the Borrower, any Subsidiary of the Borrower, any Unrestricted
Subsidiary, the VCS Subsidiary, 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 condition, results of operations or business
prospects of the Borrower or any Subsidiary of the Borrower or any
Unrestricted Subsidiary other than changes in the ordinary course of
business which have not had and could not have a Materially Adverse Effect;
(iii) any material amendment or change to the financial projections
provided to the Lenders by the Borrower prior to the Agreement Date;
(iv) any Default or the occurrence or non-occurrence of any event (A)
which constitutes, or which with the passage of time or giving of notice or
both would constitute a default by the Borrower or any Subsidiary of the
Borrower or Vanguard under any material agreement other than this Agreement
to which the Borrower or any Subsidiary of the Borrower or Vanguard is
party or by which any of their respective properties may be bound, or (B)
which could have a Materially Adverse Effect, giving in each case the
details thereof and specifying the action proposed to be taken with respect
thereto;
(v) the occurrence of any Reportable Event or a "prohibited
transaction" (as such term is defined in Section 406 of ERISA or Section
4975 of the Code) with respect to any Plan of the Borrower or any of its
Subsidiaries or the institution or threatened institution by PBGC of
proceedings under ERISA to terminate or to partially terminate 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;
(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) hereof; and
(vii) the change of any rating assigned by any of the Rating Agencies
to the Vanguard Debentures.
57
ARTICLE 7
Negative Covenants
So long as any of the Obligations is outstanding and unpaid or the Borrower has
a right to borrow from the Lenders hereunder (whether or not the conditions to
borrowing have been or can be fulfilled) and unless the Majority Lenders, or
such greater number of Lenders as may be expressly provided herein, shall
otherwise give their prior consent in writing:
Section 7.1 Indebtedness of the Borrower and its Subsidiaries. The Borrower
shall not, and shall not permit any of its Subsidiaries to, create, assume,
incur or otherwise become or remain obligated in respect of, or permit to be
outstanding, any Indebtedness except and so long as no Default then exists or
would be caused thereby:
(a) The Obligations and the "Obligations" under the Facility B Loan
Agreement;
(b) Current accounts payable, accrued expenses and customer advance
payments incurred in the ordinary course of business;
(c) Capitalized Lease Obligations in an amount for the Borrower on a
consolidated basis with its Subsidiaries not in excess, together with the
Indebtedness permitted under subsections (e), (h) and (j) of this Section
7.1, of $50,000,000.00 in the aggregate at any one time outstanding;
(d) Unsecured Subordinated Debt of the Borrower (including, without
limitation, seller notes issued in conjunction with Acquisitions permitted
under Section 7.6 hereof), provided that (i) such Subordinated Debt is
subordinated to the prior payment and performance of the Obligations, (ii)
under the terms of such Subordinated Debt there shall be no mandatory
payment or mandatory prepayment of principal in respect thereof prior to
one (1) year following the Facility A Maturity Date, (iii) such
Subordinated Debt contains terms and conditions no more onerous than
contained herein, (iv) such Subordinated Debt has no benefit of any
Guaranty and (v) both before and after giving effect to the incurrence of
such Subordinated Debt, the Borrower shall be in compliance with the terms
of this Agreement, including, without limitation, Sections 7.7, 7.8, 7.9,
7.10, 7.11 and 7.12 hereof, and the Borrower shall have delivered to the
Lenders pro forma projections demonstrating such compliance;
(e) Indebtedness secured by Permitted Liens, provided that the
aggregate amount of Capitalized Lease Obligations secured or deemed to be
secured by such Permitted Liens does not exceed the threshold for Capital
Lease Obligations set forth in Section 7.1(c) hereof, and so long as such
Indebtedness secured by Permitted Liens, when added to all Indebtedness
permitted under subsections (h) and (j) of this Section 7.1, does not
exceed $25,000,000.00 in the aggregate;
58
(f) Obligations under Interest Rate Hedge Agreements with respect to
the Loans;
(g) Indebtedness of the Borrower or any of its Subsidiaries to the
Borrower or any other Subsidiary and Indebtedness expressly permitted under
Sections 7.5 and 7.15 hereof,
(h) Other Indebtedness which, together with the other Indebtedness
referred to in subsections (e) and (j) above, does not exceed
$25,000,000.00 in the aggregate at any one time outstanding; provided such
additional Indebtedness is either (a) purchase money Indebtedness of the
Borrower or any of its Subsidiaries that, within thirty (30) days of such
purchase, is incurred or assumed to finance part or all of (but not more
than) the purchase price of a tangible asset in which neither the Borrower
nor such Subsidiary had at any time prior to such purchase any interest
other than a security interest or an interest as lessee under an operating
lease or (b) Indebtedness to finance the purchase of subscriber equipment,
such as cellular mobile telephones, cellular portable telephones, speakers,
mounting hardware, subscriber test equipment and similar equipment
purchased by the Borrower or a Subsidiary in the ordinary course of
business of such Person, to the extent that the subscriber equipment
financed thereby (x) has been sold to customers of the Borrower or any
Subsidiary and (y) the sales price thereof to any such customer has been
financed by the Borrower or such Subsidiary;
(i) Investments permitted by Section 7.6 hereof in the form of
unsecured Indebtedness; and
(j) Other unsecured Indebtedness in an amount for the Borrower on a
consolidated basis with its Subsidiaries not in excess, together with the
Indebtedness permitted under subsections (e) and (h) of this Section 7.1,
of $25,000,000.00 in the aggregate at any one time outstanding.
Section 7.2 Limitation on Liens. The Borrower shall not, and shall not
permit any of its Subsidiaries to, create, assume, incur or permit to exist or
to be created, assumed, incurred or permitted to exist, directly or indirectly,
any Lien on any of its properties or assets, whether now owned or hereafter
acquired, except for Permitted Liens.
Section 7.3 Amendment and Waiver. The Borrower shall not, and shall not
permit any of its Subsidiaries to, enter into any amendment of, or agree to or
accept or consent to any waiver of any of the material provisions of its
articles or certificate of incorporation, by-laws or partnership agreement, as
appropriate, which amendment or waiver is adverse to the interests of the
Lenders, or any amendment of any document relating to any Subordinated Debt of
the Borrower or any of its Subsidiaries.
59
Section 7.4 Liquidation, Merger, or Disposition of Assets.
(a) Disposition of Assets. The Borrower shall not, and shall not permit any
of its Subsidiaries to, at any time sell, lease, abandon or otherwise dispose of
any assets (other than obsolete or immaterial assets disposed of in the ordinary
course of business); provided, however, that if no Default exists or would be
caused thereby, the Borrower and its Subsidiaries may:
(i) (A) sell towers in the ordinary course of business so long as the
Net Proceeds are applied as provided in Section 2.6(a) hereof or (B) enter
into Tower Sale/Leaseback Transactions in the ordinary course of business;
(ii) sell or dispose of assets or exchange assets for assets related
to the Borrower's business, the aggregate net Cash Flow corresponding to
which when aggregated with aggregate net Cash Flow corresponding to all
other Permitted Asset Sales does not exceed (A) twenty-five percent (25%)
of aggregate Cash Flow during any fiscal year of the Borrower or (B) fifty
percent (50%) of aggregate Cash Flow in the aggregate during the term of
this Agreement, after giving effect to the proposed disposition of such
assets; provided, however, that (1) the Borrower or such Subsidiary, as the
case may be, receives consideration at the time of such disposition at
least equal to the fair market value of the property subject to such
disposition; (2) (a) at least eighty percent (80%) of the consideration
paid to the Borrower or such Subsidiary in connection with such disposition
is in the form of cash or cash equivalents or (b) the consideration paid to
the Borrower or such Subsidiary is determined in good faith by the Board of
Directors of the Borrower, as evidenced by a board resolution, to be
substantially comparable in type to the assets being sold; (3) in the event
the Net Proceeds of such disposition are not reinvested in assets related
to the business of the Borrower within the immediately succeeding twelve
month period, such Net Proceeds are applied as provided in Section 2.6(a)
hereof; and (4) in the event the stated Leverage Ratio under Section 7.10
hereof is greater than or equal to 5.00:1 and the Net Proceeds from any
sale or exchange of assets are not reinvested in assets related to the
business of the Borrower within the immediately succeeding fifteen month
period, such Net Proceeds are applied as provided in Section 2.7(a) hereof;
and
(iii) sell accounts receivable, leases or other income streams which
may be securitized in an aggregate amount not to exceed $75,000,000.00
pursuant to an asset securitization facility the terms and conditions of
which shall be reasonably acceptable to the Co-Administrative Agents and
the Syndication Agent.
(b) Liquidation or Merger. The Borrower shall not, and shall not permit any
of its Subsidiaries to, at any time liquidate or dissolve itself (or suffer any
liquidation or dissolution) or otherwise wind up, or enter into any merger,
other than (so long as no Default then exists or would be caused thereby) (i) a
merger among the Borrower and one or more of its Subsidiaries, provided the
Borrower is the surviving corporation, (ii) a merger between or among two (2) or
more Subsidiaries of the Borrower or (iii) an Acquisition permitted hereunder
effected by a merger in which the Borrower or a Subsidiary of the Borrower is
the surviving corporation.
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Section 7.5 Limitation on Guaranties. The Borrower shall not, and shall not
permit any of its Subsidiaries to, at any time Guaranty, assume, be obligated
with respect to, or permit to be outstanding any Guaranty of, any obligation of
any other Person other than (a) a guaranty by endorsement of negotiable
instruments for collection in the ordinary course of business; (b) obligations
under agreements of the Borrower or any of its Subsidiaries entered into in
connection with leases of real property or the acquisition of services, supplies
and equipment in the ordinary course of business of the Borrower or any of its
Subsidiaries; (c) as may be contained in any Loan Document; (d) Guaranties
arising as a result of any letters of credit issued for the Borrower's account
or the account of a Subsidiary of the Borrower pursuant to Section 7.1(i)
hereof; and (e) Investments permitted by Section 7.6 hereof in the form of
Guaranties.
Section 7.6 Investments and Acquisitions. The Borrower shall not, and shall
not permit any of its Subsidiaries to, make any loan or advance, or make any
Investment or otherwise acquire for consideration evidences of Indebtedness,
capital stock or other securities of any Person, or make any Acquisition, except
that so long as no Default then exists or would be caused thereby:
(a) The Borrower and its Subsidiaries may, directly or through a
brokerage account (i) purchase marketable, direct obligations of the United
States of America, its agencies and instrumentalities maturing within three
hundred sixty-five (365) days of the date of purchase, (ii) purchase
commercial paper issued by corporations, each of which shall have a
combined net worth of at least $100,000,000.00 and each of which conducts a
substantial part of its business in the United States of America, maturing
within two hundred seventy (270) days from the date of the original issue
thereof, and rated "P-2" or better by Moody's Investors Service, Inc. or
"A-2" or better by Standard and Poor's Ratings Group and (iii) purchase
repurchase agreements, bankers' acceptances, and certificates of deposit
maturing within three hundred sixty-five (365) days of the date of purchase
which are issued by, or time deposits or money market deposit accounts
maintained with, a United States national or state bank the deposits of
which are insured by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation and having capital, surplus
and undivided profits totaling more than $100,000,000.00 and rated "A" or
better by Moody's Investors Service, Inc. or Standard and Poor's Ratings
Group;
(b) Provided that the Borrower provides to the Agents and the Lenders
financial projections and calculations, in form and substance satisfactory
to the Co-Administrative Agents, specifically demonstrating the Borrower's
compliance with Sections 7.7, 7.8, 7.9, 7.10 and 7.11 hereof after giving
effect thereto, the Borrower may make the following Acquisitions and
Investments:
(i) Acquisitions and Investments of Cellular Systems and/or
domestic wireless telephony business (including, without limitation,
in-market and contiguous paging and auctions of Local Multipoint
Distribution Service licenses); and
(ii) other Acquisitions and Investments for an aggregate Net
Purchase Price not to exceed, together with Restricted Payments
permitted pursuant to Section 7.7(b) hereof, $100,000,000.00 during
the term of this Agreement; provided,
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however, that the Borrower shall not be required to provide compliance
calculations for Investments in the form of Restricted Payments
permitted pursuant to Section 7.7(b) hereof.
Section 7.7 Restricted Payments and Purchases. The Borrower shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly declare or
make any Restricted Payment or Restricted Purchase, except that (a) so long as
no Default then exists or would be caused thereby and the stated Leverage Ratio
under Section 7.10 hereof is equal to or less than 5.50:1, up to fifty percent
(50%) of Excess Cash Flow for the preceding fiscal year of the Borrower may be
used by the Borrower to pay dividends to its shareholders, provided that the
Borrower shall provide the Lenders with a certificate, signed by the chief
financial officer of the Borrower, demonstrating pro forma compliance with the
terms of this Section 7.7, after giving effect to such dividend payments; (b) so
long as no Default then exists or would be caused thereby, the Borrower may make
distributions to Vanguard in an aggregate amount not to exceed, together with
Acquisitions and Investments permitted pursuant to 7.6(b)(ii) hereof,
$100,000,000.00 during the term of this Agreement, provided that such
distributions shall be used by Vanguard solely for the purpose of repurchasing
its Capital Stock; (c) so long as no Default then exists or would caused
thereby, the Borrower may make loans to employees, so long as (i) the
outstanding amount of such payments or loans does not exceed $500,000.00 in the
aggregate at any time and (ii) no such loans to an employee are permitted to
remain unreimbursed or unpaid by any such employee for more than two (2) years;
(d) so long as no Default then exists or would be caused thereby, the Borrower
may make distributions to Vanguard in an aggregate amount not to exceed, for any
fiscal year, the aggregate amount of current scheduled payments of accrued
interest with respect to the Vanguard Subordinated Debt, plus or minus, as the
case may be, the amount of any payments made or received, as the case may be, by
Vanguard pursuant to any Vanguard Interest Rate Hedge Agreements, which would
not constitute an Event of Default under Section 8.1(q) hereof, provided that
such distributions shall be made solely for the purpose of permitting Vanguard
to make current scheduled payments of accrued interest with respect to the
Vanguard Subordinated Debt and payments by Vanguard pursuant to any such
Vanguard Interest Rate Hedge Agreements; and (e) the Borrower may pay expenses
of Vanguard related solely to its operating obligations in an amount not to
exceed $1,250,000.00 for any fiscal year.
Section 7.8 Interest Coverage Ratio. The Borrower shall not at any time
permit the Interest Coverage Ratio to be less than the ratios set forth below
during the periods indicated:
Period Ratio
------ -----
Agreement Date through
December 30, 1998 1.50:1
December 31, 1998 through
December 30, 1999 1.75:1
December 31, 1999 and
thereafter 2.00:1
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Section 7.9 Fixed Charge Ratio. Beginning December 31, 2000, the Borrower
shall not at any time permit the Fixed Charge Ratio to be less than 1.05: 1.
Section 7.10 Leverage Ratio. The Borrower shall not at any time permit the
Leverage Ratio to exceed the ratios set forth below during the periods
indicated:
Period Ratio
------ -----
Agreement Date through
September 29, 1998 7.50:1
September 30, 1998 through
June 30, 1999 7.00:1
July 1, 1999 through
December 30, 1999 6.50:1
December 31, 1999 through
December 30, 2000 6.00:1
December 31, 2000 through
December 30, 2001 5.50.1
December 31, 2001 and
thereafter 5.00:1
Section 7.11 Pro Forma Debt Service Ratio. The Borrower shall not at any
time permit the Pro Forma Debt Service Ratio to be less than 1.05:1.
Section 7.12 Affiliate Transactions. Except as specifically provided herein
(including, without limitation, Section 7.7 hereof) and as may be described on
Schedule 6 attached hereto, the Borrower shall not, and shall not permit any of
its Subsidiaries to, at any time engage in any transaction with an Affiliate, or
make an assignment or other transfer of any of its properties or assets to any
Affiliate, on terms less advantageous to the Borrower or such Subsidiary than
would be the case if such transaction had been effected with a non-Affiliate.
Section 7.13 Real Estate. The Borrower and its Subsidiaries may not
purchase real estate, become obligated to purchase real estate or enter into any
sale/leaseback transaction during the term of this Agreement, except for real
estate acquired in conjunction with an Acquisition permitted under Section 7.6
hereof, or otherwise for use in the wireless communications business of the
Borrower or any of its Subsidiaries, or Tower Sale/Leaseback Transactions
permitted under Section 7.4 hereof.
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Section 7.14 ERISA Liabilities. The Borrower shall not, and shall not
permit any of its Subsidiaries to, (i) permit the assets of any of their
respective Plans to be less than the amount necessary to provide all accrued
benefits under such Plans or (ii) enter into any Multiemployer Plan.
Section 7.15 Unrestricted Subsidiaries. From time to time the Borrower may
form or otherwise acquire one (1) or more additional Unrestricted Subsidiaries,
provided that the Borrower provides the Co-Administrative Agents with notice of
its intent to form or acquire an Unrestricted Subsidiary making reference to
this Section 7.15, together with the following information with respect to each
such Unrestricted Subsidiary, not less than ten (10) days prior to such
formation or acquisition: (1) the name and state of incorporation or formation
of such Unrestricted Subsidiary; (2) the intended purpose for and business to be
conducted by such Unrestricted Subsidiary; (3) the amount and nature of any
Investment to be made in such Unrestricted Subsidiary by the Borrower or any of
its Subsidiaries; and (4) such additional information as the Co-Administrative
Agents may reasonably require with respect thereto. The Borrower shall not
permit any Unrestricted Subsidiary to: (a) create, assume, incur or otherwise
become or remain obligated in respect of or permit to be outstanding any
Indebtedness, other than Indebtedness which is non-recourse to the Borrower and
the Subsidiaries; (b) create, assume, incur or permit to exist or to be created,
any Lien on any of its properties or assets, whether now owned or hereafter
acquired, other than Liens securing Indebtedness which is non-recourse to the
Borrower and the Subsidiaries; or (c) Guaranty, assume, be obligated with
respect to or permit to be outstanding any Guaranty of, any obligation of any
other Person, other than Guaranties which are non-recourse to the Borrower and
the Subsidiaries. In addition, the Borrower shall not and shall not permit any
of its Subsidiaries to: (i) pledge or permit the pledge of the capital stock or
other ownership interests of any Unrestricted Subsidiary to any Person (other
than to the Collateral Agent as additional Collateral for the Obligations); (ii)
make any loan or advance to, or Guaranty any obligations of, any Unrestricted
Subsidiary or otherwise acquire for consideration evidences of Indebtedness,
capital stock or other securities of any Unrestricted Subsidiary, other than
Investments permitted by Section 7.6 hereof and intercompany loans and advances
among the Unrestricted Subsidiaries; or (iii) transfer any assets to any
Unrestricted Subsidiary.
Section 7.16 The VCS Subsidiary. The Borrower shall not permit the VCS
Subsidiary to incur Indebtedness or to create Liens on its assets; nor shall the
Borrower pledge or permit the pledge of the stock of the VCS Subsidiary to any
Person (other than to the Collateral Agent as additional Collateral for the
Obligations); nor shall the Borrower or any of its Subsidiaries lend or invest
any funds in or transfer any assets to the VCS Subsidiary or Guaranty any
obligations of the VCS Subsidiary. The Borrower shall not permit the net worth
of the VCS Subsidiary, after giving effect to all contingent liabilities and as
otherwise determined in accordance with GAAP, to be less than zero at any time.
The Borrower and its Subsidiaries may borrow and repay up to $5,000,000.00 from
the VCS Subsidiary on a short-term basis; provided, however, that (i) the rate
of any interest payable to the VCS Subsidiary in respect of such Indebtedness
shall not exceed the blended rate payable on the Loans, (ii) no repayment of
such Indebtedness or payment of any interest thereon shall be made at such time
as there exists any Default, or at such time as any Default would be caused
thereby and (iii) the VCS Subsidiary has entered into a subordination agreement
in form and substance reasonably satisfactory to the Majority Lenders.
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Section 7.17 Limitation on Upstream Dividends by Subsidiaries. The Borrower
shall not permit any Subsidiary (other than CPAC) to enter into or agree, or
otherwise become subject, to any agreement, contract or other arrangement with
any Person pursuant to the terms of which (a) such Subsidiary is or would be
prohibited from declaring or paying any cash dividends or distributions on any
class of its stock or any partnership interests owned directly or indirectly by
the Borrower or from making any other distribution on account of any class of
any such stock or any such partnership interests (herein referred to as
"Upstream Dividends") or (b) the declaration or payment of Upstream Dividends by
a Subsidiary to the Borrower or to another Subsidiary, on an annual or
cumulative basis, is or would be otherwise limited or restricted.
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 nongovernmental body:
(a) Any representation or warranty made or deemed to be made under
this Agreement or any other Loan Document shall prove incorrect or
misleading in any material respect when made or deemed to be made pursuant
to Section 4.2 hereof;
(b) The Borrower shall default in the payment of (i) any interest
under any of the Notes or fees or other amounts payable to the Swing Line
Lender, the Issuing Bank, the Lenders and the Funding Agent (except as
provided in clause (b)(ii) of this Section 8.1), or any of them, when due,
and such Default shall not be cured by payment in full within three (3)
Business Days from the due date; or (ii) any principal under any of the
Notes or reimbursement obligations under any Letter of Credit when due
(including, without limitation, pursuant to Section 2.7 hereof);
(c) The Borrower shall default (i) in the performance or observance of
any agreement or covenant contained in Sections 5.9 or 6.5 hereof or
Article 7 hereof, (ii) in the performance or observance of any other
negative covenant contained in any of the other Loan Documents; or (iii) in
providing any financial statement or report under Article 6 hereof, and,
with respect to this clause (iii) only, such default shall not be cured by
delivery thereof within a period of fifteen (15) days from the occurrence
of such default;
(d) 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 within a period of thirty (30) days from the occurrence of such
default;
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(e) There shall occur any default in the performance or observance of
any agreement or covenant contained in any of the Loan Documents (other
than this Agreement or as otherwise provided in this Section 8.1) by the
Borrower, any of its Subsidiaries, or any other obligor thereunder, which
shall not be cured within a period of thirty (30) days from the occurrence
of such default;
(f) There shall be entered and remain unstayed a decree or order for
relief in respect of Vanguard, the Borrower or any of the Borrower's
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 Vanguard, the
Borrower or any of the Borrower's Subsidiaries, or of any substantial part
of their respective properties; or ordering the winding-up or liquidation
of the affairs of Vanguard, the Borrower or any of the Borrower's
Subsidiaries; or an involuntary petition shall be filed against Vanguard,
the Borrower or any of the Borrower's Subsidiaries and a temporary stay
entered, and (i) such petition and stay shall not be diligently contested
or (ii) any such petition and stay shall continue undismissed for a period
of thirty (30) consecutive days;
(g) Vanguard, the Borrower or any of the Borrower's 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
Vanguard, the Borrower or any of the Borrower's Subsidiaries shall consent
to the institution of proceedings thereunder or to the filing of any such
petition or to the appointment of or taking of possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of Vanguard, the Borrower or any of the Borrower's Subsidiaries or
of any substantial part of their respective properties, or Vanguard, the
Borrower or any of the Borrower's Subsidiaries shall fail generally or
admit in writing their inability to pay their respective debts as they
become due, or Vanguard, the Borrower or any of the Borrower's Subsidiaries
shall take any action in furtherance of any such action;
(h) A judgment not covered by insurance shall be entered by any court
against Vanguard, the Borrower or any of the Borrower's Subsidiaries for
the payment of money which exceeds singly or in the aggregate with other
such judgments, $5,000,000.00, or a warrant of attachment or execution or
similar process shall be issued or levied against property of Vanguard, the
Borrower or any of the Borrower's Subsidiaries which, together with all
other such property of Vanguard, the Borrower or any of the Borrower's
Subsidiaries subject to other such process, exceeds in value $5,000,000.00
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;
(i) There shall be at any time any "accumulated funding deficiency,"
as defined in ERISA or in Section 412 of the Code, with respect to any Plan
maintained by the Borrower or any of its Subsidiaries, or to which the
Borrower or any of its Subsidiaries has any liabilities, or any trust
created thereunder; or a trustee shall be appointed by a United States
District Court to
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administer any such Plan; or PBGC shall institute proceedings to terminate
any such Plan; or the Borrower or any of its Subsidiaries shall incur any
liability to PBGC in connection with the termination of any such Plan; or
any Plan or trust created under any Plan of the Borrower or any of its
Subsidiaries shall engage in a "prohibited transaction" (as such term is
defined in Section 406 of ERISA or Section 4975 of the Code) which would
subject any such Plan, any trust created thereunder, any trustee or
administrator thereof, or any party dealing with any such Plan or trust to
the tax or penalty on "prohibited transactions" imposed by Section 502 of
ERISA or Section 4975 of the Code;
(j) There shall occur: (i) any acceleration of the maturity of, or any
failure to pay at final maturity, any Indebtedness of the Borrower or any
of the Borrower's Subsidiaries in an aggregate principal amount exceeding
$1,000,000.00; (ii) any event of default which would permit such
acceleration of such Indebtedness and which event of default has not been
cured within any applicable cure period or waived in writing prior to any
declaration of an Event of Default or acceleration of the Loans hereunder;
or (iii) any material default under any Interest Rate Hedge Agreement or
Vanguard Interest Rate Hedge Agreement having a notional principal amount
of $1,000,000.00 or more;
(k) The FCC shall deliver to the Borrower or any of its Subsidiaries
an order to show cause why an order of revocation should not be issued
based upon any alleged attribution of alien ownership (within the meaning
of 47 U.S.C. ss. 310(b) and any interpretation of the FCC thereunder) to
the Borrower or any of its Subsidiaries and (i) such order shall not have
been rescinded within thirty (30) days after such delivery or (ii) in the
reasonable judgment of the Majority Lenders, proceedings by or before the
FCC related to such order are reasonably likely to result in one (1) or
more orders of revocation and would constitute an Event of Default under
Section 8.1(m) hereof,
(l) One (1) or more Licenses shall be terminated or revoked such that
the Borrower and its Subsidiaries are no longer able to operate the related
Cellular System or Systems or portion thereof and retain the revenue
received therefrom or any such License shall fail to be renewed at the
stated expiration thereof such that the Borrower and its Subsidiaries are
no longer able to operate the related Cellular System or Systems or portion
thereof and retain the revenue received therefrom, and the overall effect
of such termination, revocation or failure to renew would be to reduce
Annualized Cash Flow (determined as at the last day of the most recently
ended fiscal year of the Borrower) by five percent (5%) or more;
(m) Any Loan Document which is a contract or any Note or the
Subsidiary Guaranty, or any material provision thereof, shall at any time
and for any reason be declared by a court of competent jurisdiction to be
null and void, or a proceeding shall be commenced by the Borrower or any of
the Borrower's Subsidiaries, or by any governmental authority having
jurisdiction over the Borrower or any of the Borrower's Subsidiaries,
seeking to establish the invalidity or unenforceability thereof (exclusive
of questions of interpretation of any provision thereof), or the Borrower
or any of the Borrower's Subsidiaries shall deny that it has any liability
or obligation for the payment of principal or interest purported to be
created under any Loan Document;
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(n) Any Security Document shall for any reason fail or cease (except
by reason of lapse of time) to create a valid and perfected and
first-priority Lien on or security interest in any portion of the
Collateral purported to be covered thereby;
(o) The occurrence of a Change of Control;
(p) There shall occur any default under the Vanguard Subordinated Debt
or the Vanguard Indenture which default has not been cured within any
applicable cure period or waived in writing prior to any declaration of an
Event of Default or acceleration of the Loans hereunder;
(q) Vanguard shall (i) make any acquisition of or investment in any
assets or interests of any Person or (ii) issue or extend any Guaranties or
incur any Indebtedness (excluding expenses incurred by Vanguard solely as a
result of its operating obligations to the extent the payment thereof would
be permitted pursuant to Section 7.7(e) hereof) other than (A) Indebtedness
arising under the Vanguard Subordinated Debt and (B) obligations arising
under any Vanguard Interest Rate Hedge Agreement;
(r) There shall be any amendment or supplemental indenture, other than
an amendment or supplemental indenture to cure any ambiguity or to cure,
correct or supplement any defect or inconsistent provision, to the Vanguard
Debentures or the Vanguard Indenture without Majority Lender consent; or
(s) There shall occur any Event of Default under the Facility B Loan
Agreement.
Section 8.2 Remedies.
(a) If an Event of Default specified in Section 8.1 hereof (other than an
Event of Default under Section 8.1(f) or (g) hereof) shall have occurred and
shall be continuing, the Collateral Agent, at the request of the Majority
Lenders, shall formally declare that an Event of Default has occurred, and (i)
(A) terminate the Facility A Commitment and (B) declare the principal of and
interest on the Loans and the Notes and all other Obligations owed to the
Lenders and the Agents under this Agreement and the other Loan Documents 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 other Loan Documents to the contrary notwithstanding, and the Facility A
Commitment shall thereupon forthwith terminate, or both and (ii) require the
Borrower to, and the Borrower shall thereupon, deposit in an interest bearing
account with the Funding Agent, as cash collateral for the Obligations, an
amount equal to the maximum amount currently or at any time thereafter to be
drawn on all outstanding Letters of Credit, and the Borrower hereby pledges to
the Funding Agent, the Lenders and the Issuing Bank and grants to them a
security interest in, all such cash as security for the Obligations.
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(b) Upon the occurrence and continuance of an Event of Default specified in
Section 8.1(f) or (g) hereof, all principal, interest and other amounts due
hereunder and under the Notes, and all other Obligations, shall thereupon and
concurrently therewith become due and payable and the Facility A Commitment
shall forthwith terminate and the principal amount of the Loans outstanding
hereunder shall bear interest at the Default Rate, all without any action by the
Agents, the Issuing Bank, the Swing Line Lender, the Lenders or the Majority
Lenders, or any of them, and without presentment, demand, protest or other
notice of any kind, all of which are expressly waived, anything in this
Agreement or in the other Loan Documents to the contrary notwithstanding, and
the Borrower shall thereupon forthwith deposit in an interest bearing account
with the Funding Agent, as cash collateral for the Obligations, an amount equal
to the maximum amount concurrently or at any time thereafter available to be
drawn on all outstanding Letters of Credit, all 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, and
the Borrower hereby pledges to the Funding Agent, the Lenders and the Issuing
Bank, and grants to the Funding Agent, the Lenders and the Issuing Bank a
security interest in, all such cash as security for the Obligations.
(c) Upon acceleration of the Notes, as provided in subsection (a) or (b) of
this Section 8.2, the Agents and the Lenders, and each of them, shall have all
of the post-default rights granted to them, or any of them, as applicable under
the Loan Documents and under Applicable Law.
(d) Upon acceleration of the Notes, as provided in subsection (a) or (b) of
this Section 8.2, the Collateral Agent shall have the right (but not the
obligation) upon the request of each of the Lenders to operate the Cellular
Systems of the Borrower and its Subsidiaries in accordance with the terms of the
Licenses and pursuant to the terms and subject to any limitations contained in
the Security Documents and, within guidelines established by the Majority
Lenders, 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
Lenders fail to agree upon the guidelines referred to in the preceding sentence
within six (6) Business Days after the Collateral Agent has begun to operate any
Cellular System, the Collateral Agent may, after giving three (3) days' prior
written notice to the Lenders of its intention to do so, make such payments and
expenditures as it deems reasonable and advisable in its sole discretion to
maintain the normal day-to-day operation of such Cellular Systems. Such payments
and expenditures in excess of receipts shall constitute Advances under the
Facility A Commitment, not in excess of the Available Facility A Commitment.
Advances made pursuant to this Section 8.2(d) shall bear interest as provided in
Section 2.3(d) hereof and shall be payable on demand. The making of one (1) or
more Advances under this Section 8.2(d) shall not create any obligation on the
part of the Lenders to make any additional Advances hereunder. No exercise by
the Collateral Agent of the rights granted to it under this Section 8.2(d) shall
constitute a waiver of any other rights and remedies granted to the Agents and
the Lenders, or any of them, under this Agreement or the other Loan Documents or
at law. The Borrower hereby irrevocably appoints the Collateral Agent, as agent
for the Lenders, 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
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and all contracts, instruments or other documents in connection with the
completion and operation of the Cellular Systems in the exercise of the
Collateral Agent's and the Lenders' rights under this Section 8.2(d). Such power
of attorney is coupled with an interest and is irrevocable. The rights of the
Collateral Agent under this Section 8.2(d) shall be subject to its prior
compliance with the Communications Act and the FCC rules and policies
promulgated thereunder to the extent applicable to the exercise of such rights.
(e) Upon acceleration of the Notes, as provided in subsection (a) or (b) of
this Section 8.2, the Collateral Agent, upon request of the Majority Lenders,
shall have the right to the appointment of a receiver for the properties and
assets of the Borrower and its Subsidiaries, and the Borrower, for itself and on
behalf of its Subsidiaries, hereby consents to such rights and such appointment
and hereby waives any objection the Borrower or any Subsidiary may have thereto
or the right to have a bond or other security posted by the Collateral Agent on
behalf of the Lenders, in connection therewith. The rights of the Collateral
Agent under this Section 8.2(e) shall be subject to its prior compliance with
the Communications Act and the FCC rules and policies promulgated thereunder to
the extent applicable to the exercise of such rights.
(f) The rights and remedies of the Agents and the Lenders hereunder shall
be cumulative and not exclusive.
(g) In the event that the Funding Agent establishes a cash collateral
account as contemplated by this Section 8.2, the Funding Agent shall invest all
funds in such account in such investments as the Funding Agent in its sole and
absolute discretion deems appropriate. The Borrower hereby acknowledges and
agrees that any interest earned on such funds shall be retained by the Funding
Agent as additional collateral for the Obligations. Upon satisfaction in full of
all Obligations, the Funding Agent shall pay any amounts then held in such
account to the Borrower.
Section 8.3 Payments Subsequent to Declaration of Event of Default.
Subsequent to the acceleration of the Loans under Section 8.2 hereof, payments
and prepayments under this Agreement made to any of the Agents and the Lenders
or otherwise received by any of such Persons (from realization on Collateral for
the Obligations or otherwise) shall be paid over to the Funding Agent (if
necessary) and distributed by the Funding Agent as follows: First, to the costs
and expenses, if any, incurred by the Agents, the Swing Line Lender or the
Lenders, or any of them, to the extent permitted by Section 11.2 hereof, in the
collection of such amounts under this Agreement or any of the other Loan
Documents, including, without limitation, any reasonable costs incurred in
connection with the sale or disposition of any Collateral for the Obligations;
Second, pro rata among the Agents, the Swing Line Lender and the Lenders based
on the total amount of fees then due and payable hereunder or under any other
Loan Document and to any other fees and commissions then due and payable by the
Borrower to the Lenders, the Swing Line Lender and the Agents under this
Agreement or any Loan Document; Third, to be deposited as set forth in Section
8.2(b) hereof; Fourth, to any unpaid interest of the Borrower which may have
accrued (i) first on the Swing Line Loans and (ii) thereafter on the Facility A
Loans, pro rata among the Lenders on the outstanding principal amount of the
Facility A Loans of the Borrower outstanding immediately prior to such payment;
Fifth, to the Swing Line Lender, to any unpaid
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principal of the Swing Line Loans then outstanding; Sixth, pro rata among the
Lenders based on the outstanding principal amount of the Loans of the Borrower
outstanding immediately prior to such payment, to any unpaid principal of the
Loans; Seventh, to any other Obligations not otherwise referred to in this
Section 8.3 until all such Obligations are paid in full; Eighth, to damages
incurred by the Agents, the Swing Line Lender or the Lenders, or any of them, by
reason of any breach hereof or of any other Loan Documents; and Ninth, upon
satisfaction in full of all Obligations, to the Borrower or as otherwise
required by law.
ARTICLE 9
The Agents
Section 9.1 Appointment and Authorization. Each Lender hereby irrevocably
appoints and authorizes, and any transferee of any of its interest in its Loans
and in its Notes shall be deemed to have irrevocably appointed and authorized,
the Issuing Bank, the Funding Agent, the Documentation Agent, the Syndication
Agent, the Co-Administrative Agents and the Collateral Agent to take such
actions as its agents on its behalf and to exercise such powers hereunder as are
delegated by the terms hereof, together with such powers as are reasonably
incidental thereto. None of the Issuing Bank, the Collateral Agent, the Funding
Agent, the Documentation Agent, the Syndication Agent, any Co-Administrative
Agent or any of their respective directors, officers, employees or agents, shall
be liable for any action taken or omitted to be taken by it or them hereunder or
in connection herewith, except for its or their own gross negligence or willful
misconduct.
Section 9.2 Interest Holders. The Agents and the Issuing Bank may treat
each Lender, or the Person designated in the last notice filed with the Funding
Agent, as the holder of all of the interests of such Lender in its Loans and in
its Notes until written notice of transfer, signed by such Lender (or the person
designated in the last notice filed with the Funding Agent) and by the Person
designated in such written notice of transfer, in form and substance
satisfactory to the Funding Agent, shall have been filed with the Funding Agent.
Section 9.3 Consultation with Counsel. The Co-Administrative Agents, the
Collateral Agent, the Documentation Agent, the Syndication Agent, the Issuing
Bank and the Funding Agent may consult with Powell, Goldstein, Frazer & Murphy
LLP, Atlanta, Georgia, special counsel to the Co-Administrative Agents, or with
other legal counsel selected by them and shall not be liable for any action
taken or suffered by them in good faith in consultation with the Majority
Lenders or all Lenders, as applicable, and in reasonable reliance on such
consultations.
Section 9.4 Documents. The Co-Administrative Agents, the Collateral Agent,
the Documentation Agent, the Syndication Agent, the Issuing Bank and the Funding
Agent shall be under no duty to examine, inquire into, or pass upon the
validity, effectiveness or genuineness of this Agreement, any Note, any other
Loan Document, or any instrument, document or communication furnished pursuant
hereto or thereto or in connection herewith or therewith, and the
Co-Administrative Agents, the Collateral Agent, the Documentation Agent, the
Syndication
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Agent, the Issuing Bank and the Funding 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 9.5 Agents and Affiliates. With respect to the Facility A
Commitment and the Loans, the Agents shall have the same rights and powers
hereunder as any other Lender and the Agents and Affiliates of the Agents may
accept deposits from, lend money to and generally engage in any kind of business
with the Borrower, any of its Subsidiaries or any Affiliates of, or persons
doing business with, the Borrower, as if they were not affiliated with the
Agents and without any obligation to account therefor.
Section 9.6 Responsibility of the Co-Administrative Agents, the Funding
Agent, the Documentation Agent, the Syndication Agent, the Issuing Bank and the
Collateral Agent. The duties and obligations of the Co-Administrative Agents,
the Funding Agent, the Documentation Agent, the Syndication Agent and the
Collateral Agent under this Agreement are only those expressly set forth in this
Agreement. Each Co-Administrative Agent, the, Funding Agent, the Documentation
Agent, the Syndication Agent, the Issuing Bank and the Collateral Agent shall be
entitled to assume that no Default has occurred and is continuing unless it has
actual knowledge, or has been notified by the Borrower, of such fact, or has
been notified by a Lender in writing that such Lender considers that a Default
has occurred and is continuing and such Lender shall specify in detail the
nature thereof in writing. Each Co-Administrative Agent, the Funding Agent, the
Documentation Agent, the Syndication Agent, the Issuing Bank and the Collateral
Agent shall not be liable hereunder for any action taken or omitted to be taken
except for its own gross negligence or willful misconduct. The Funding Agent
shall provide each Lender with copies of such documents received from the
Borrower as such Lender may reasonably request.
Section 9.7 Collateral Agent. The Collateral Agent is hereby authorized to
act on behalf of the Lenders, in its own capacity and through other agents and
sub-agents appointed by it, under the Security Documents, provided that the
Collateral 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 11.12 hereof. Each Lender and each Agent hereby agree
that the Obligations are to be secured pari passu with all "Obligations" as
defined in the Facility B Loan Agreement and that all Collateral now or
hereafter delivered as security for the Obligations shall be held by the
Collateral Agent (or delivered to the Collateral Agent, if received by any
Lender) in accordance with the Security Documents.
Section 9.8 Action by Co-Administrative Agents, the Funding Agent, the
Documentation Agent, the Syndication Agent, the Issuing Bank and the Collateral
Agent.
(a) The Co-Administrative Agents, the Funding Agent, the Documentation
Agent, the Syndication Agent, the Issuing Bank and the Collateral Agent shall be
entitled to use their discretion with respect to exercising or refraining from
exercising any rights which may be vested in them or any of them by, and with
respect to taking or refraining from taking any action or actions which they may
be able to take under or in respect of, this Agreement or any other Loan
Document, unless the Funding Agent, the Documentation Agent, the Syndication
Agent,
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either Co-Administrative Agent, the Issuing Bank or the Collateral Agent shall
have been instructed by the Majority Lenders or all Lenders, as applicable, to
exercise or refrain from exercising such rights or to take or refrain from
taking such action; provided that the Collateral Agent shall not exercise any
rights under Section 8.2(a) hereof without the request of the Majority Lenders.
Each Co-Administrative Agent, the Funding Agent, the Documentation Agent, the
Syndication Agent, the Issuing Bank and the Collateral Agent shall incur no
liability under or in respect of this Agreement or any other Loan Document 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 willful misconduct, or
conduct in breach of this Agreement as determined by a final, non-appealable
judicial order of a court having jurisdiction over the subject matter.
(b) Each Co-Administrative Agent, the Funding Agent, the Documentation
Agent, the Syndication Agent, the Issuing Bank and the Collateral Agent shall
not be liable to the Lenders or to any Lender in acting or refraining from
acting under this Agreement in accordance with the instructions of the Majority
Lenders or all Lenders, as applicable, and any action taken or failure to act
pursuant to such instructions shall be binding on all Lenders.
Section 9.9 Notice of Default. In the event that any Agent or any Lender
shall acquire actual knowledge, or shall have been notified, of any Default,
such Agent or such Lender shall promptly notify the Lenders and the other
Agents, as applicable, and the Collateral Agent shall take such action and
assert such rights under this Agreement as the Majority Lenders or all Lenders,
as applicable, shall request in writing, and the Collateral Agent shall not be
subject to any liability by reason of its acting pursuant to any such request.
If the Majority Lenders or all Lenders, as applicable, shall fail to request the
Collateral Agent to take action or to assert rights under this Agreement in
respect of any Default within ten (10) days after their receipt of the notice of
any Default from the Funding Agent or any Lender, or shall request inconsistent
action with respect to such Default, the Collateral Agent may, but shall not be
required to, take such action and assert such rights (other than rights under
Article 8 hereof) as it deems in its discretion to be advisable for the
protection of the Lenders, except that, if the Majority Lenders have instructed
the Collateral Agent not to take such action or assert such right, in no event
shall the Collateral Agent act contrary to such instructions.
Section 9.10 Responsibility Disclaimed. None of the Agents or the Issuing
Bank shall be under any liability or responsibility whatsoever as Agents or
Issuing Bank, as applicable:
(a) To the Borrower or any other Person as a consequence of any
failure or delay in performance by or any breach by, any Lender or Lenders
of any of its or their obligations under this Agreement;
(b) To any Lender or Lenders, as a consequence of any failure or delay
in performance by, or any breach by, (i) the Borrower of any of its
obligations under this Agreement or the Notes or any other Loan Document or
(ii) any Subsidiary of the Borrower or any other obligor under any other
Loan Document; or
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(c) To any Lender or Lenders for any statements, representations or
warranties in this Agreement or any other document contemplated by this
Agreement or any information provided pursuant to this Agreement, any other
Loan Document or any other document contemplated by this Agreement, or for
the validity, effectiveness, enforceability or sufficiency of this
Agreement, the Notes, any other Loan Document or any other document
contemplated by this Agreement.
Section 9.11 Indemnification. The Lenders agree to indemnify each of the
Agents (to the extent not reimbursed by the Borrower) pro rata according to
their respective Commitment Ratios in effect at the time indemnification is
sought, from and against any and all liabilities, obligations, losses (other
than the loss of principal and interest hereunder in the event of a bankruptcy
or out-of-court 'work-out' of the Loans), damages, penalties, actions,
judgments, suits, costs, expenses (including, without limitation, fees and
expenses of experts, agents, consultants and counsel), or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by or asserted
against any of the Agents 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 such Agent under this Agreement, any
other Loan Document or any other document contemplated by this Agreement;
provided, however, that no Lender shall be liable to any Agent for any portion
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the gross
negligence or willful misconduct of such Agent as determined by a final,
non-appealable judicial order of a court having jurisdiction over the subject
matter.
Section 9.12 Credit Decision. Each Lender represents and warrants to each
other and to the Agents 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 its Subsidiaries and Affiliates and it has made an independent credit
judgment, and it has not relied upon the Agents or information provided by
the Agents (other than information provided to the Agents by the Borrower
and forwarded by the Agents to the Lenders); and
(b) So long as any portion of the Loans remains outstanding, it will
continue to make its own independent evaluation of the financial condition
and affairs of the Borrower and its Subsidiaries and Affiliates.
Section 9.13 Successor Funding Agent, Documentation Agent,
Co-Administrative Agent, Syndication Agent and Collateral Agent. Subject to the
appointment and acceptance of a successor Funding Agent, Documentation Agent,
Co-Administrative Agent, Syndication Agent, or Collateral Agent as provided
below, the Funding Agent, the Documentation Agent, the Co-Administrative Agents,
Syndication Agent and the Collateral Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower and may be removed at any
time for cause by the Majority Lenders. Upon any such resignation or removal,
the Majority Lenders shall have the right to appoint a successor Funding Agent,
Documentation Agent,
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Co-Administrative Agent, Syndication Agent or Collateral Agent, as applicable.
If no such successor Funding Agent, Documentation Agent, Co-Administrative
Agent, Syndication Agent or Collateral Agent shall have been so appointed by the
Majority Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Funding Agent's, Documentation Agent's,
Co-Administrative Agent's, Syndication Agent's or Collateral Agent's giving of
notice of resignation or the Majority Lenders' removal of the retiring Funding
Agent, Documentation Agent, Co-Administrative Agent, the Syndication Agent or
Collateral Agent, then the retiring Funding Agent, Collateral Agent,
Co-Administrative Agent, the Syndication Agent or Documentation Agent may, on
behalf of the Lenders, appoint a successor Funding Agent, Collateral Agent,
Co-Administrative Agent, the Syndication Agent or Documentation Agent which
shall be any Lender or a commercial bank organized under the laws of the United
States of America or any political subdivision thereof which has combined
capital and reserves in excess of $250,000,000.00. Upon the acceptance of any
appointment as Funding Agent, Documentation Agent, Co-Administrative Agent, the
Syndication Agent or Collateral Agent hereunder by a successor Funding Agent,
Documentation Agent, Co-Administrative Agent, the Syndication Agent or
Collateral Agent, such successor Funding Agent, Documentation Agent,
Co-Administrative Agent, the Syndication Agent or Collateral Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges,
duties and obligations of the retiring Funding Agent, Documentation Agent,
Co-Administrative Agent, the Syndication Agent or Collateral Agent and the
retiring Funding Agent, Documentation Agent, Co-Administrative Agent, the
Syndication Agent or Collateral Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents. After any retiring
Funding Agent's, Documentation Agent's, Co-Administrative Agent's, the
Syndication Agent's or Collateral Agent's resignation or removal hereunder as
Funding Agent, Documentation Agent, Co-Administrative Agent, the Syndication
Agent or Collateral 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 Funding Agent, Documentation Agent,
Co-Administrative Agent, the Syndication Agent or Collateral Agent.
Section 9.14 Delegation of Duties. Each Agent may execute any of its duties
under the Loan Documents by or through agents or attorneys selected by it using
reasonable care and shall be entitled to advice of counsel concerning all
matters pertaining to such duties.
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ARTICLE 10
Change in Circumstances
Affecting Eurodollar Advances
Section 10.1 Eurodollar Basis Determination Inadequate. If with respect to
any proposed Eurodollar Advance for any Interest Period, the Funding Agent
determines after consultation with the Lenders that deposits in dollars (in the
applicable amount) are not being offered to each of the Lenders in the relevant
market for such Interest Period, the Funding Agent shall forthwith give notice
thereof to the Borrower and the Lenders, whereupon until the Funding Agent
notifies the Borrower that the circumstances giving rise to such situation no
longer exist, the obligations of any affected Lender to make Eurodollar Advances
shall be suspended.
Section 10.2 Illegality. If after the date hereof, the adoption of any
Applicable Law, or any change in any Applicable Law (whether adopted before or
after the Agreement Date), or any change in interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
with any directive (whether or not having the force of law) of any such
authority, central bank or comparable agency, shall make it unlawful or
impossible for any Lender to make, maintain or fund its Eurodollar Advances,
such Lender shall so notify the Funding Agent, and the Funding Agent shall
forthwith give notice thereof to the other Lenders and the Borrower. Before
giving any notice to the Funding Agent pursuant to this Section 10.2, such
Lender shall designate a different lending office if such designation will avoid
the need for giving such notice and will not, in the sole judgment of such
Lender, be otherwise materially disadvantageous to such Lender. Upon receipt of
such notice, notwithstanding anything contained in Article 2 hereof, the
Borrower shall repay in full the then outstanding principal amount of each
affected Eurodollar Advance of such Lender, together with accrued interest
thereon and any reimbursement required under Section 2.10 hereof, on either (a)
the last day of the then current Interest Period applicable to such affected
Eurodollar Advances if such Lender may lawfully continue to maintain and fund
such Eurodollar Advances to such day or (b) immediately if such Lender may not
lawfully continue to fund and maintain such affected Eurodollar Advances to such
day. Concurrently with repaying each affected Eurodollar Advance of such Lender,
notwithstanding anything contained in Article 2 or 3 hereof, the Borrower shall
borrow a Prime Rate Advance from such Lender, and such Lender shall make such
Advance in an amount such that the outstanding principal amount of the affected
Note or Notes held by such Lender shall equal the outstanding principal amount
of such Note or Notes immediately prior to such repayment.
Section 10.3 Increased Costs.
(a) If after the date hereof, the adoption of any Applicable Law, or any
change in any Applicable Law (whether adopted before or after the Agreement
Date), or any interpretation or change in interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof or compliance by any Lender
with any directive (whether or not having the force of law) of any such
authority, central bank or comparable agency:
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(i) shall subject any Lender to any tax, duty or other charge with
respect to its obligation to make Eurodollar Advances, or its Eurodollar
Advances, or shall change the basis of taxation of payments to any Lender
of the principal of or interest on its Eurodollar Advances or in respect of
any other amounts due under this Agreement, in respect of its Eurodollar
Advances or its obligation to make Eurodollar Advances (except for changes
in the rate or method of calculation of tax on the overall net income of
such Lender); or
(ii) shall impose, modify or deem applicable any reserve (including,
without limitation, any imposed by the Board of Governors of the Federal
Reserve System, but excluding any included in an applicable Eurodollar
Reserve Percentage), special deposit, capital adequacy, assessment or other
requirement or condition against assets of, deposits with or for the
account of, or commitments or credit extended by, any Lender or shall
impose on any Lender or the London interbank Eurodollar 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 to increase the cost to such Lender of
making or maintaining any such Eurodollar Advances, or to reduce the amount of
any sum received or receivable by such Lender under this Agreement or under any
of its Notes with respect thereto, then, on a date within five (5) days after
demand by such Lender, the Borrower agrees to pay to such Lender such additional
amount or amounts as will compensate such Lender for such increased costs or
reduction. Each Lender will promptly notify the Borrower and the Funding Agent
of any event of which it has knowledge, occurring after the date hereof, which
will entitle such Lender to compensation pursuant to this Section 10.3 and will
designate a different lending office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the sole
judgment of such Lender made in good faith, be otherwise disadvantageous to such
Lender.
(b) Any Lender claiming compensation under this Section 10.3 shall provide
the Borrower with a written certificate setting forth the additional amount or
amounts to be paid to it hereunder and calculations therefor in reasonable
detail. Such certificate shall be presumptively correct. Notwithstanding the
foregoing, the Borrower shall only be obligated to compensate such Lender for
any amount under this subsection arising or occurring during (i) in the case of
each such request for compensation, any time or period commencing not more than
ninety (90) days prior to the date on which such Lender submits such request and
(ii) any other time or period during which, because of the unannounced
retroactive application of such law, regulation, interpretation, request or
directive, such Lender could not have known that the resulting reduction in
return might arise. In determining such amount, such Lender may use any
reasonable averaging and attribution methods. If any Lender demands compensation
under this Section 10.3, the Borrower may at any time, upon at least five (5)
Business Days' prior notice to such Lender, prepay in full the then outstanding
affected Eurodollar Advances of such Lender, together with accrued interest
thereon to the date of prepayment, along with any reimbursement required under
Section 2.10 hereof. Concurrently with prepaying such Eurodollar Advances the
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Borrower shall borrow a Prime Rate Advance, or a Eurodollar Advance not so
affected, from such Lender, and such Lender shall make such Advance in an amount
such that the outstanding principal amount of the affected Note or Notes held by
such Lender shall equal the outstanding principal amount of such Note or Notes
immediately prior to such prepayment.
Section 10.4 Effect On Other Advances. If notice has been given pursuant to
Section 10.1, 10.2 or 10.3 hereof suspending the obligation of any Lender to
make any Eurodollar Advance, or requiring Eurodollar Advances of any Lender to
be repaid or prepaid, then, unless and until such Lender notifies the Borrower
that the circumstances giving rise to such repayment no longer apply, all
Advances which would otherwise be made by such Lender as the type of Eurodollar
Advances affected shall, at the option of the Borrower, be made instead as Prime
Rate Advances.
Section 10.5 Claims for Increased Costs and Taxes. In the event that any
Lender shall decline to make Eurodollar Rate Loans pursuant to Section 10.1 and
10.2 hereof or shall have notified the Borrower that it is entitled to claim
compensation pursuant to Section 10.3 or 2.12 hereof or is unable to complete
the form required or subject to withholding as provided in Section 2.13 hereof
(each such lender being an "Affected Lender"), the Borrower at its own cost and
expense may, with the prior written consent of the Funding Agent which consent
shall not be unreasonable delayed or withheld, designate a replacement lender (a
"Replacement Lender") to assume the Facility A Commitment and the obligations of
any such Affected Lender hereunder and to purchase the outstanding Loans of such
Affected Lender and the rights of such Affected Lender hereunder and with
respect thereto, and within ten (10) Business Days of such designation the
Affected Lender shall (a) sell to such Replacement Lender, without recourse
upon, warranty by or expense to such Affected Lender, by way of an Assignment
and Assumption Agreement substantially in the form of Exhibit J attached hereto,
for a purchase price equal to (unless such Lender agrees to a lesser amount) the
outstanding principal amount of the Loans of such Affected Lender, plus all
interest accrued and unpaid thereon and all other amounts owing to such Affected
Lender hereunder, including, without limitation, any amount which would be
payable to such Affected Lender pursuant to Section 2.12 hereof, and (b) assign
the Facility A Commitment of such Affected Lender, and upon such assumption and
purchase by the Replacement Lender, such Replacement Lender shall be deemed to
be a "Lender" for purposes of this Agreement and such Affected Lender shall
cease to be a "Lender" for purposes of this Agreement and shall no longer have
any obligations or rights hereunder (other than any obligations or rights which
according to this Agreement shall survive the termination of the Facility A
Commitment).
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 three (3) days after deposit in
the mail, designated
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as certified mail, return receipt requested, post-prepaid, or one (1) day after
being entrusted to a reputable commercial overnight delivery service, or when
sent by telecopy addressed to the party to which such notice is directed at its
address determined as provided in this Section 11.1. All notices and other
communications under this Agreement shall be given to the parties hereto at the
following addresses:
(i) If to the Borrower, to it at:
Vanguard Cellular Financial Corp.
2002 Pisgah Church Road, Suite 300
Greensboro, NC 27455-3314
Attn: Stephen L. Holcombe, Vice President
and Chief Financial Officer
Telecopy No.: (336) 545-2265
with a copy to:
Vanguard Cellular Financial Corp.
2002 Pisgah Church Rd., Suite 300
Greensboro, NC 27455-3314
Attn: Mr. Richard C. Rowlenson
Vice President and General Counsel
Telecopy No.: (336) 545-2219
(ii) If to the Funding Agent, to it at:
The Bank of New York
One Wall Street, 18th Floor
New York, NY 10286
Attn: Mr. Genoveso Caviness
Telecopy No.: (212) 635-6365
with a copy to the Funding Agent's Office, to the attention of
Mr. Gerry Granovsky at telecopy number (212) 635-8593.
(iii) If to the Documentation Agent, to it at:
The Toronto-Dominion Bank USA Division
31 West 52nd Street
New York, NY 10019-6101
Attn: Managing Director-Transactions Communications Finance
Telecopy No.: (212) 262-1927
with a copy to:
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Toronto Dominion (Texas), Inc.
909 Fannin, Suite 900
Houston, TX 77010
Attn: Manager-Agency
Telecopy No.: (713) 951-9921
(iv) If to the Collateral Agent, to it at:
Toronto Dominion (Texas), Inc.
909 Fannin, Suite 900
Houston, TX 77010
Attn: Manager-Agency
Telecopy No.: (713) 951-9921
(v) If to the Co-Administrative Agents and the Lenders, to them at the
addresses set forth beside their names on the signature pages hereof.
Copies shall be provided to persons other than parties hereto only in the case
of notices under Article 8 hereof.
(b) Any party hereto may change the address to which notices shall be
directed under this Section 11.1 by giving ten (10) days' written notice of such
change to the other parties.
Section 11.2 Expenses. The Borrower will promptly pay, or reimburse:
(a) all reasonable out-of-pocket expenses of the Co-Administrative
Agents, the Collateral Agent, the Documentation Agent, the Syndication
Agent and the Funding 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 Powell, Goldstein, Frazer & Murphy LLP, special counsel for the
Co-Administrative Agents;
(b) all reasonable out-of-pocket expenses of the Co-Administrative
Agents, the Collateral Agent, the Documentation Agent, the Syndication
Agent and the Funding Agent in connection with the administration of the
transactions contemplated in this Agreement and the other Loan Documents,
the restructuring and "work out" of such transactions, and the preparation,
negotiation, execution and delivery of any waiver, amendment or consent by
the Agents and the Lenders relating to this Agreement and/or the other Loan
Documents, including, but not limited to, the reasonable fees and
disbursements of any experts, agents or consultants and of special counsel
for the Co-Administrative Agents; and
(c) all out-of-pocket costs and expenses of obtaining performance
under this Agreement and the other Loan Documents and all out-of-pocket
costs and expenses of collection
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if an Event of Default occurs, which in each case shall include reasonable
fees and out-of-pocket expenses of special counsel for the
Co-Administrative Agents.
Section 11.3 Waivers. The rights and remedies of the Agents and the Lenders
under this Agreement and the other Loan Documents shall be cumulative and not
exclusive of any rights or remedies which they would otherwise have. No failure
or delay by the Agents, the Majority Lenders or the Lenders, or any of them, in
exercising any right shall operate as a waiver of such right. The Agents and the
Lenders, and each of them, expressly reserve the right to require strict
compliance with the terms of this Agreement in connection with any future
funding of a request for an Advance. In the event the Lenders decide to fund a
request for an Advance at a time when the Borrower is not in strict compliance
with the terms of this Agreement, such decision by the Lenders shall not be
deemed to constitute an undertaking by the Lenders to fund any further requests
for Advances or preclude the Lenders or the Agents, or any of them, from
exercising any rights available under the Loan Documents or at law or equity.
Any waiver or indulgence granted by the Agents, the Lenders or the Majority
Lenders, or any of them, shall not constitute a modification of this Agreement,
except to the extent expressly provided in such waiver or indulgence, or
constitute a course of dealing at variance with the terms of the Agreement such
as to require further notice of their intent to require strict adherence to the
terms of this Agreement in the future.
Section 11.4 Set-Off. In addition to any rights now or hereafter granted
under Applicable Law and not by way of limitation of any such rights, upon the
occurrence of a Default and during the continuation thereof, each of the Agents
and each of the Lenders and the Swing Line Lender are hereby authorized by the
Borrower at any time or from time to time, without notice to the Borrower or to
any other Person, any such notice being hereby expressly waived, to set off and
to appropriate and to apply any and all deposits (general or special, time or
demand, including, but not limited to, Indebtedness evidenced by certificates of
deposit, in each case whether matured or unmatured) and any other Indebtedness
at any time held or owing by the Swing Line Lender, any Lender or Agent, 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
Swing Line Lender, the Lenders and the Agents, and any of them, including, but
not limited to, all Obligations and any other claims of any nature or
description arising out of or connected with this Agreement, the Notes or any
other Loan Document, irrespective of whether (a) the Swing Line Lender, any
Lender or Agent shall have made any demand hereunder or (b) the Swing Line
Lender, any Lender or Agent shall have declared the principal of and interest on
the Loans and other amounts due hereunder to be due and payable as permitted by
Section 8.2 hereof and although such obligations and liabilities or any of them,
shall be contingent or unmatured. Upon direction by the Collateral Agent with
the consent of the Majority Lenders, each Lender and the Swing Line Lender
holding deposits of the Borrower or any of its Subsidiaries shall exercise its
set-off rights as so directed.
81
Section 11.5 Assignment.
(a) The Borrower may not assign or transfer any of its rights or
obligations hereunder or under any other Loan Document without the prior written
consent of each of the Lenders.
(b) Each Lender may enter freely into participation agreements with respect
to or otherwise grant participations in the Loans and the Facility A Commitment
to one or more banks or other lenders or financial institutions; provided,
however, that (i) such Lender's obligations hereunder shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) the participant shall not be entitled
by the benefit of its participation to vote or otherwise take action under this
Agreement or any other Loan Document, except with respect to items (a), (b),
(c), (d), (e), (f) and (g) of Section 11.12 hereof, (iv) the Borrower shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations hereunder, (v) each such participation shall be
in a minimum principal amount of $5,000,000.00 and (vi) if no Event of Default
has occurred and is continuing, the Borrower is provided notice of such
participation. In addition, each Lender (x) may also sell or assign up to one
hundred percent (100%) of its rights hereunder and under the other Loan
Documents to any of its Affiliates or any Federal Reserve Bank without
limitation and (y) sell or assign up to one hundred percent (100%) of its rights
and obligations hereunder and under the other Loan Documents on an assignment
basis; provided that, with respect to assignments pursuant to clause (y), (A)
such assignment is to another Lender or an Affiliate of a Lender, or the
Borrower (if no Event of Default has occurred and is continuing) and (in any
case) the Funding Agent have given their prior written consent to the identity
of any proposed assignee of a Lender hereunder, which consent shall not be
unreasonably delayed or withheld, (B) each assignment to any assignee shall
consist of an assignment of a pro rata portion of the Facility A Commitment and
the Loans thereunder, (C) the assignee assumes a pro rata share of the assignor
Lender's obligations hereunder determined by the percentage of the Facility A
Commitment assigned, for the period from the date of the assignment through the
Facility A Maturity Date and (D) each such assignment shall be in a principal
amount of not less than the lesser of the entire amount of such Lender's
interest hereunder, or $10,000,000.00 (except that assignments from one Lender
to another or an Affiliate of a Lender shall have no minimum amount). Each
Lender who sells or assigns a portion of its Loans pursuant hereto shall pay to
the Funding Agent an assignment fee of $3,500.00 with respect to each
assignment, such fee to be paid to the Funding Agent not later than the
effective date of the assignment of the Loans relating thereto. Each Lender
agrees to provide the Funding Agent and the Borrower with written notice of the
assignment of all or part of its rights hereunder, and the Funding Agent shall
keep a record of all such assignments in order to be able to calculate the
Commitment Ratios of the Lenders as of any time. All assignments by any of the
Lenders of any interests hereunder shall be made pursuant to an Assignment and
Assumption Agreement substantially in the form of Exhibit J attached hereto.
Each Lender may provide any proposed participant or assignee with confidential
information provided to such Lender regarding the Borrower and its Subsidiaries
on a confidential basis, and such participant or assignee shall agree to
maintain such confidentiality as provided in Section 11.19 hereof. Further, each
permitted assignee of any portion of the Loans shall be entitled to the benefits
of Sections 2.10 and 2.12 hereof and Article 10 hereof and all other
82
provisions hereof and of the other Loan Documents as a Lender hereunder. Upon
any assignment of the Loans and the Facility A Commitment, the Commitment Ratios
of the Lenders shall be deemed to be amended to give effect thereto.
(c) Except as specifically set forth in Section 11.5(b) hereof, nothing in
this Agreement or the Notes, or any of them, 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, or any of them.
(d) The provisions of this Section 11.5 shall not apply to any purchase of
participations among the Lenders pursuant to Section 2.11 hereof.
Section 11.6 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. All
references to the financial statements of the Borrower and to Cash Flow, Total
Consolidated Debt, Fixed Charges, Pro Forma Debt Service, and other such terms
shall be deemed to refer to such items of the Borrower (or Vanguard in the case
of Total Consolidated Debt) and its Subsidiaries, on a fully consolidated basis.
Section 11.7 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
Section 11.8 GOVERNING LAW. THIS AGREEMENT AND THE NOTES SHALL BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN NEW YORK. IF ANY ACTION OR
PROCEEDING SHALL BE BROUGHT BY ANY AGENT OR ANY LENDER HEREUNDER IN ORDER TO
ENFORCE ANY RIGHT OR REMEDY UNDER THIS AGREEMENT OR UNDER ANY OTHER LOAN
DOCUMENT, THE BORROWER HEREBY CONSENTS AND WILL, AND THE BORROWER WILL CAUSE
EACH SUBSIDIARY TO, SUBMIT TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION SITTING WITHIN THE AREA COMPRISING THE SOUTHERN DISTRICT
OF NEW YORK ON THE DATE OF THIS AGREEMENT. THE BORROWER, FOR ITSELF AND ON
BEHALF OF ITS SUBSIDIARIES, HEREBY AGREES THAT SERVICE OF THE SUMMONS AND
COMPLAINT AND ALL OTHER PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING MAY BE EFFECTED BY MAILING BY REGISTERED MAIL A COPY OF SUCH PROCESS
TO THE OFFICES OF THE BORROWER AT THE ADDRESS GIVEN IN SECTION 11.1 HEREOF AND
THAT PERSONAL SERVICE OF PROCESS SHALL NOT BE REQUIRED. NOTHING HEREIN SHALL BE
CONSTRUED TO PROHIBIT SERVICE OF PROCESS BY ANY OTHER METHOD PERMITTED BY LAW,
OR THE BRINGING OF ANY SUIT, ACTION OR PROCEEDING IN ANY OTHER JURISDICTION. THE
BORROWER
83
AGREES THAT FINAL JUDGMENT IN SUCH SUIT, ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY APPLICABLE LAW. THE BORROWER, FOR ITSELF AND
ON BEHALF OF ITS SUBSIDIARIES, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND
ANY CLAIM THAT SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
Section 11.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof in that jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 11.10 Interest.
(a) In no event shall the amount of interest due or payable hereunder or
under the Notes exceed the maximum rate of interest allowed by Applicable Law,
and in the event any such payment is inadvertently made by the Borrower or
inadvertently received by the Funding Agent or any Lender, then such excess sum
shall be credited as a payment of principal, unless the Borrower shall notify
the Funding Agent or such Lender, 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 Funding Agent and the Lenders not receive, directly or indirectly in
any manner whatsoever, interest in excess of that which may legally be paid by
the Borrower under Applicable Law.
(b) Notwithstanding the use by the Lenders of the Prime Rate and the
Eurodollar Rate as reference rates for the determination of interest on the
Loans, the Lenders shall be under no obligation to obtain funds from any
particular source in order to charge interest to the Borrower at interest rates
related to such reference rates.
Section 11.11 Table of Contents and Headings. The Table of Contents and the
headings of the various subdivisions used in this Agreement are for convenience
only and shall not in any way modify or amend any of the terms or provisions
hereof, nor be used in connection with the interpretation of any provision
hereof.
Section 11.12 Amendment and Waiver. Neither this Agreement nor any 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 Lenders and, in the case
of an amendment, by the Borrower, except that in the event of (a) any increase
in the amount of the Facility A Commitment, (b) any delay or extension in the
terms of repayment of the Loans or the reduction of the Facility A Commitment
provided in Section 2.4 hereof, (c) any reduction in principal, interest or fees
due hereunder or postponement of the payment thereof or any reduction in or
postponement of any scheduled reduction in the Facility A Commitment (other
than, in any such case, as provided in
84
Section 2.7 hereof), (d) any release of any portion of the Collateral for the
Loans, other than in connection with any Permitted Asset Sale or other sale of
assets permitted hereby (which release shall require no further approval by the
Lenders), (e) any amendment to, consent to a deviation from, or waiver of the
provisions of, this Agreement which has the effect of permitting the Borrower or
any of its Subsidiaries to incur secured Indebtedness other than as set forth in
Sections 7.1 and 7.2 hereof as of the Agreement Date, (f) any waiver of any
Default due to the failure by the Borrower to pay any sum due to any of the
Lenders hereunder, (g) any release of any Guaranty of all or any portion of the
Obligations, except in connection with a merger, sale or other disposition
otherwise permitted hereunder (in which case, such release shall require no
further approval by the Lenders) or (h) any amendment of this Section 11. 12, or
of the definition of Majority Lenders or of any portion of Section 2.10, 2.12 or
5.11 hereof or Article 10 hereof as they relate to the relative priority of
payment among the Obligations or any provision which by its terms specifically
requires the consent, approval or satisfaction of all Lenders, any amendment or
waiver or consent may be made only by an instrument in writing signed by each of
the Lenders and, in the case of an amendment, by the Borrower. Any amendment to
any provision hereunder governing the rights, obligations or liabilities of the
Issuing Bank or any Agent in its capacity as such, may be made only by an
instrument in writing signed by such affected Person and by each of the Lenders.
Notwithstanding anything to the contrary contained herein, the parties hereto
hereby agree that the provisions of Section 2.15 hereof may be modified or
waived only by a writing signed by the Borrower, the Funding Agent and the Swing
Line Lender and that the terms "Swing Line Commitment" and "Available Swing Line
Commitment" may only be modified or amended by a writing signed by the Borrower,
the Swing Line Lender and the Majority Lenders. No term or provision of any
Security Document may be amended or waived orally, but only by an instrument in
writing signed by the Collateral Agent with the direction of the Majority
Lenders and, in the case of an amendment, by such of the Borrower and its
Subsidiaries as are party thereto; provided that the written consent of all of
the Lenders shall be required with respect to any amendment to or waiver of the
provisions of any Security Document which would have the effect of (i) releasing
any portion of the Collateral for the Loans, other than in connection with any
Permitted Asset Sale or other sale of assets permitted hereunder (which shall
require no further approval by the Lenders) or (ii) releasing any Guaranty of
all or any portion of the Obligations, except in connection with a merger, sale
or other disposition otherwise permitted hereunder (in which case, such release
shall require no further approval by the Lenders). The Agents and the Lenders
hereby instruct and authorize the Collateral Agent to enter into the amended and
restated Security Documents (and all other Loan Documents) referred to in
Section 3.1 hereof as of the Agreement Date and any other Security Documents
required to be entered into by the Borrower or any of its Subsidiaries
hereunder.
Section 11.13 Entire Agreement. Except as otherwise expressly provided
herein, this Agreement and the other documents described or contemplated herein
embody the entire Agreement and understanding among the parties hereto and
thereto and supersede all prior agreements and understandings relating to the
subject matter hereof and thereof.
Section 11.14 Other Relationships. No relationship created hereunder or
under any other Loan Document shall in any way affect the ability of each Agent
and each Lender to enter into or
85
maintain business relationships with the Borrower or any of its Affiliates
beyond the relationships specifically contemplated by this Agreement or any of
the other Loan Documents.
Section 11.15 Directly or Indirectly. If any provision in this Agreement
refers to any action taken or to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether such action
is taken directly or indirectly by such Person, whether or not expressly
specified in such provision.
Section 11.16 Reliance on and Survival of Various Provisions. All
covenants, agreements, statements, representations and warranties made herein or
in any certificate delivered pursuant hereto (i) shall be deemed to have been
relied upon by each of the Agents and the Lenders notwithstanding any
investigation heretofore or hereafter made by them and (ii) shall survive the
execution and delivery of the Notes and shall continue in full force and effect
so long as any Note is outstanding and unpaid. Notwithstanding anything herein
which may be construed to the contrary (including, without limitation, Article 5
hereof), any right to indemnification hereunder, including, without limitation,
rights pursuant to Sections 2.10, 2.12, 5.11, 10.3 and 11.2 hereof, shall
survive the termination of this Agreement and the payment and performance of all
other Obligations.
Section 11.17 Senior Debt. The Indebtedness of the Borrower evidenced by
the Notes is secured by the Security Documents and is intended by the parties
hereto to be in parity with the Interest Rate Hedge Agreements between the
Borrower and any Lender or its Affiliate and senior in right of payment to all
other Indebtedness of the Borrower.
Section 11.18 Obligations Several. The obligations of each of the Agents
and the Lenders hereunder are several, not joint.
Section 11.19 Confidentiality. The Lenders shall hold all non-public,
proprietary or confidential information (which has been identified as such by
the Borrower) obtained pursuant to the requirements of this Agreement in
accordance with their customary procedures for handling confidential information
of this nature and in accordance with safe and sound banking practices;
provided, however, the Lenders may make disclosure of any such information to
their examiners, Affiliates, outside auditors, counsel, consultants, appraisers
and other professional advisors in connection with this Agreement or as
reasonably required by any proposed syndicate member or any proposed transferee
or participant in connection with the contemplated transfer of any Note or
participation therein or as required or requested by any governmental authority
or representative thereof or in connection with the enforcement hereof or of any
Loan Document or related document or pursuant to legal process or with respect
to any litigation between or among the Borrower and any of the Lenders or
involving any Lender. In no event shall any Lender be obligated or required to
return any materials furnished to it by the Borrower. The foregoing provisions
shall not apply to a Lender with respect to information that (i) is or becomes
generally available to the public (other than through such Lender), (ii) is
already in the possession of such Lender on a nonconfidential basis or (iii)
comes into the possession of such Lender in a manner not involving a breach of a
duty of confidentiality owing to the Borrower.
86
ARTICLE 12
WAIVER OF JURY TRIAL
Section 12.1 WAIVER OF JURY TRIAL. THE BORROWER, FOR ITSELF AND ON BEHALF
OF ITS SUBSIDIARIES, THE UNRESTRICTED SUBSIDIARIES AND THE VCS SUBSIDIARY, AND
EACH OF THE AGENTS AND THE LENDERS, HEREBY AGREES TO WAIVE AND HEREBY WAIVES THE
RIGHT TO A TRIAL BY JURY IN ANY COURT AND IN ANY ACTION OR PROCEEDING OF ANY
TYPE IN WHICH THE BORROWER, ANY OF ITS SUBSIDIARIES, ANY OF ITS UNRESTRICTED
SUBSIDIARIES, ANY OF THE LENDERS, ANY OF THE AGENTS, OR ANY OF THEIR RESPECTIVE
SUCCESSORS OR ASSIGNS IS A PARTY, AS TO ALL MATTERS AND THINGS ARISING DIRECTLY
OR INDIRECTLY OUT OF THIS AGREEMENT, ANY OF THE NOTES OR THE OTHER LOAN
DOCUMENTS AND THE RELATIONS AMONG THE PARTIES LISTED IN THIS SECTION 12.1.
[Remainder of this Page Intentionally Left Blank]
87
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused it to be executed under seal by their duly authorized officers, all as of
the day and year first above written.
VANGUARD CELLULAR FINANCIAL CORP.,
a North Carolina corporation
By: /s/ Stephen L. Holcombe
----------------------------------
Name: Stephen L. Holcombe
Title: Vice President
[CORPORATE SEAL]
Attest: /s/ Richard C. Rowlenson
-----------------------------
Name: Richard C. Rowlenson
Title: Assistant Secretary
THE BANK OF NEW YORK, as Funding Agent,
Co-Administrative Agent, Issuing Bank,
Swing Line Lender and Lender
By: /s/ Gerry Granovsky
----------------------------------
Gerry Granovsky
Assistant Vice President
THE TORONTO-DOMINION BANK,
as Documentation Agent,
Co-Administrative Agent and Lender
By: /s/ Neva Nesbitt
----------------------------------
Name: Neva Nesbitt
Title: Manager, Credit
Administration
TORONTO DOMINION (TEXAS), INC.,
as Collateral Agent
By: /s/ Neva Nesbitt
----------------------------------
Name: Neva Nesbitt
Title: Vice President
NATIONSBANK OF TEXAS, N.A.,
as Syndication Agent and Lender
By: /s/ Daniel J. Robbitt
----------------------------------
Name: Daniel J. Robbitt
Title: Vice President
THE BANK OF NOVA SCOTIA, as Lender
By: /s/ Vincent J. Fitzgerald, Jr.
----------------------------------
Name: Vincent J. Fitzgerald, Jr.
Title: Authorized Signatory
BANKBOSTON, N.A., as a Lender
By: /s/ Kay H. Campbell
----------------------------------
Name: Kay H. Campbell
Title: Authorized Signer
BANK OF TOKYO-MITSUBISHI TRUST COMPANY,
as a Lender
By: /s/ Glenn B. Eckert
----------------------------------
Name: Glenn B. Eckert
Title: Vice President
BANQUE PARIBAS, as a Lender
By: /s/ Lynne S. Rendell
----------------------------------
Name: Lynne S. Rendell
Title: Director
By: /s/ William B. Schrink
----------------------------------
Name: William B. Schrink
Title: Director
BARCLAYS BANK PLC, as a Lender
By: /s/ James K. Downey
----------------------------------
Name: James K. Downey
Title: Director
CoBANK, ACB, as a Lender
By: /s/ John P. Cole
----------------------------------
Name: John P. Cole
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH,
as a Lender
By: /s/ John P. Judge
----------------------------------
Name: John P. Judge
Title: Vice President
FIRST HAWAIIAN BANK, as a Lender
By: /s/ James G. Polk
----------------------------------
Name: James G. Polk
Title: Assistant Vice President
THE FIRST NATIONAL BANK OF MARYLAND,
as a Lender
By: /s/ Timothy A. Knabe
----------------------------------
Name: Timothy A. Knabe
Title: Vice President
FLEET NATIONAL BANK, as a Lender
By: /s/ Sue Anderson
----------------------------------
Name: Sue Anderson
Title: Vice President
ROYAL BANK OF CANADA, as a Lender
By: /s/ Thomas M. Byrne
----------------------------------
Name: Thomas M. Byrnen
Title: Senior Vice President
SOCIETE GENERAL, as a Lender
By: /s/ John Sadik-Kahan
----------------------------------
Name: John Sadik-Kahan
Title: Vice President
THE SUMITOMO TRUST & BANKING CO., LTD.,
as a Lender
By: /s/ Suraj P. Bhatia
----------------------------------
Name: Suraj P. Bhatia
Title: Senior Vice President
ABN AMRO BANK N.V., as a Lender
By: /s/ Jerold M. Sniderman
----------------------------------
Name: Jerold M. Sniderman
Title: Group Vice President
By: /s/ Larry K. Kelley
----------------------------------
Name: Larry K. Kelley
Title: Group Vice President
CORESTATES BANK, N.A., as a Lender
By: /s/ Charles Brinley
----------------------------------
Name: Charles Brinley
Title: Commercial Officer
CIBC INC, as a Lender
By: /s/ Cynthia McCahill
----------------------------------
Name: Cynthia McCahill
Title: CIBC Oppenheimer Corp,
AS AGENT
BANK OF HAWAII, as a Lender
By: /s/ Robert Wilson
----------------------------------
Name: Robert Wilson
Title: Vice President
BANQUE NATIONALE DE PARIS, as a Lender
By: /s/ Marcus C. Jones
----------------------------------
Name: Marcus C. Jones
Title: Vice President
By: /s/ Pamela Lucash
----------------------------------
Name: Pamela Lucash
Title: Assistant Vice President
THE LONG-TERM CREDIT BANK OF JAPAN, LTD,
as a Lender
By: /s/ Philip Marsden
----------------------------------
Name: Philip Marsden
Title: Senior Vice President
UNION BANK OF CALIFORNIA, N.A.,
as a Lender
By: /s/ Gabe Renga
----------------------------------
Name: Gabe Renga
Title: Senior Vice President
DRESDNER BANK AG, NEW YORK AND GRAND
CAYMAN BRANCHES, as a Lender
By: /s/ William E. Lambert Brian Haughney
--------------------------------------------------------
Name: William E. Lambert Brian Haughney
Title: Assisistant Vice President Assistant Treasurer
KEY CORPORATE CAPITAL INC., as a Lender
By: /s/ Kenneth J. Keeler
----------------------------------
Name: Kenneth J. Keeler
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ Karen L. Groschopp
----------------------------------
Name: Karen L. Groschopp
Title: Senior Banking Officer
THE SUMITOMO BANK, LIMITED, as a Lender
By: /s/ Suresh Tata
----------------------------------
Name: Suresh Tata
Title: Senior Vice President
SUNTRUST BANK, CENTRAL FLORIDA, N.A.,
as a Lender
By: /s/ Ronald K. Rueve
----------------------------------
Name: Ronald K. Rueve
Title: Vice President
RIGGS BANK N.A., as a Lender
By: /s/ Louanne Baily
----------------------------------
Name: Louanne Baily
Title: Vice President
THE FUJI BANK, LIMITED, NEW YORK BRANCH,
as a Lender
By: /s/ Teiji Teramoto
----------------------------------
Name: Teiji Teramoto
Title: Vice President & Manager