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EXHIBIT 10(e)
AMENDMENT NO. 2 TO THE
CREDIT AGREEMENT
Dated as of March 31, 1997
AMENDMENT NO. 2 TO THE CREDIT AGREEMENT ("this Amendment") among Powertel,
Inc. (formerly known as InterCel PCS Services, Inc.), a Delaware corporation
(the "Borrower"), and Ericsson Project Finance A.B. ("Ericsson") as Lender and
Ericsson, as agent (the "Agent") for the Lenders.
PRELIMINARY STATEMENTS:
(1) The Borrower, the Lender and the Agent are parties to the
Credit Agreement dated as of March 4, 1996, as amended by Amendment
No. 1 dated as of October 31, 1996 (the "Credit Agreement").
Capitalized terms not otherwise defined in this Amendment have the
same meanings as specified in the Credit Agreement.
(2) The Borrower intends to incur additional Debt in connection
with (a) the acquisition of certain PCS licenses obtained in a
recent auction conducted by the Federal Communications Commission
for the 10 MHz D, E and F block PCS licenses and (b) the build out
and operation of PCS systems in the Basic Trading Areas ("BTA")
corresponding to those licenses. The Borrower has therefore
requested changes to the covenants of the Credit Agreement to
reflect the incurrence of such additional Debt by the Borrower.
SECTION 1. Amendments to the Credit Agreement. The Credit Agreement is,
effective as of the date hereof, and subject to the satisfaction of the
conditions precedent set forth in Section 2 hereof, hereby amended as follows:
(a) The following definitions are added in alphabetical order to
Section 1.01 of the Credit Agreement:
"Capital Expenditures" means any payments which are made by a
Person for, or in connection with, the rental, lease, purchase,
construction or use of any real or personal property the value or
cost of which, under GAAP,
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should be capitalized and appear on such Person's balance sheet in
the category of property, plant or equipment, without regard to
the manner in which such payments or the instrument pursuant to
which they are made are characterized by such Person or any other
Person.
"Debt Service" means, for any period, the sum of all principal
payments scheduled to be made by the Borrower in respect of Debt
during such period plus Interest Expense for such period.
"Interest Expense" means for any period, the aggregate amount of
interest, commitment, agency and other fees paid or required to be
paid in cash by InterCel and its Subsidiaries in respect of all
Debt.
(b) Section 6.01 is amended by replacing the period at the end of
clause (s) thereof with "; or" and the following:
(t) InterCel shall fail to maintain, for each period ending on
the last day of each fiscal quarter of InterCel as set forth
on Schedule 6.01(t), a ratio of Consolidated EBITDA for such
period multiplied by 4 to Consolidated Debt Service for such
period multiplied by 4 of not less than the ratio set forth
for such period on such schedule; or
(u) InterCel shall permit the ratio of Consolidated Total Debt as
of the last day of each fiscal quarter of InterCel as set
forth on Schedule 6.01(u) to Consolidated EBITDA for such
period multiplied by 4 to be greater than the ratio set forth
for such period on such schedule; or
(v) InterCel and its Subsidiaries shall make any Capital
Expenditures that would cause the aggregate cumulative amount
of all such Capital Expenditures made by InterCel and its
Subsidiaries commencing January 1, 1997 to exceed the amount
set forth on Schedule 6.01(v) as of the end of each period
set forth on such schedule;"
(c) The schedules to the Credit Agreement are amended as follows:
(i) Schedule 6.01(o) is deleted in its entirety and
replaced with Annex A attached hereto.
(ii) Schedule 6.01(q) is deleted in its entirety and
replaced with Annex B attached hereto.
(iii)Schedule 6.01(r) is deleted in its entirety and
replaced with Annex C attached hereto.
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(iv) Schedule 6.01(s) is deleted in its entirety and
replaced with Annex D attached hereto.
(v) Schedule 6.01(t) is added to the Credit Agreement in
the form of Annex E attached hereto.
(vi) Schedule 6.01(u) is added to the Credit Agreement in
the form of Annex F attached hereto.
(vii)Schedule 6.01(v) is added to the Credit Agreement in
the form of Annex G attached hereto.
SECTION 2. Conditions of Effectiveness. This Amendment shall become
effective as of the date first written when, and only when, the Agent shall
have received (a) counterparts of this Amendment executed by the Borrower and
Ericsson and (b) a consent executed by each Loan Party in substantially the
form of Annex H attached hereto. The effectiveness of this Amendment is
conditioned upon the accuracy of the factual matters described herein. This
Amendment is subject to the provisions of Section 8.01 of the Amended Credit
Agreement.
SECTION 3. Representations and Warranties of the Borrower.
(a) The execution, delivery and performance by the Borrower of this
Amendment are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action and do not (i)
contravene the Borrower's charter or by-laws, (ii) violate any law,
rule or regulation (including, without limitation, Regulation X of
the Board of Governors of the Federal Reserve System), or any order,
writ, judgment, injunction, decree, determination or award, binding
on or affecting the Borrower or any of its Subsidiaries or any of
their properties the effect of which would not have a Material
Adverse Effect, or (iii) conflict with or result in the breach of,
or constitute a default under, any contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument
binding on or affecting the Borrower, any of its Subsidiaries or any
of their properties except where such conflict would not have a
Material Adverse Effect.
(b) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body or any
other third party is required for the due execution, delivery or
performance by the Borrower of this Amendment.
(c) This Amendment has been duly executed and delivered by the
Borrower. This Amendment is a legal, valid and binding obligation
of the Borrower in accordance with its terms.
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SECTION 4. Reference to and Effect on the Credit Agreement.
(a) The Credit Agreement, as specifically amended by this
Amendment, is and shall continue to be in full force and effect and
is hereby in all respects ratified and confirmed.
(b) The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver
of any right, power or remedy of any Lender or the Agent under the
Credit Agreement, nor constitute a waiver of any provision of the
Credit Agreement.
SECTION 5. Costs, Expenses. The Borrower agrees to pay on demand all
reasonable costs and expenses of the Agent in connection with the preparation,
execution, delivery and negotiation of this Amendment and the other instruments
and documents to be delivered hereunder (including, without limitation, the
reasonable fees and expenses of counsel for the Agent).
SECTION 6. Execution in Counterparts. This Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but on and the same agreement.
Delivery of an executed counterpart of a signature page to this Amendment by
telecopier shall be effective as delivery of a manually executed counterpart of
this Amendment.
SECTION 7. Governing Law. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first written above.
POWERTEL, INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Executive Vice President and
Chief Operating Officer
ERICSSON PROJECT FINANCE A.B.
By: /s/ Xxxxxxx Xxxxxxxx; Xxxxx Everum
-------------------------------------
Title:
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ANNEX A
Schedule 6.01(o)
Minimum PCS Revenue
Quarter
Ending 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
------- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
31-Mar N/A 7,300,000 25,000,000 43,000,000 80,000,000 107,000,000 129,000,000 141,000,000 155,000,000 169,000,000
30-Jun N/A 10,600,000 32,000,000 67,000,000 95,000,000 115,000,000 129,000,000 145,000,000 158,000,000 170,000,000
30-Sep N/A 14,500,000 38,000,000 73,000,000 101,000,000 122,000,000 137,000,000 155,000,000 169,000,000 181,000,000
31-Dec 2,000,000 19,000,000 44,000,000 82,000,000 110,000,000 133,000,000 150,000,000 169,000,000 184,000,000 197,000,000
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ANNEX B
Schedule 6.01(q)
Minimum Consolidated Net Worth
QUARTER ENDING 1996 1997 1998 1999 2000
-------------- ---- ---- ---- ---- ----
31-Mar N/A 307,000,000 212,000,000 15,000,000 (163,000,000)
30-Jun N/A 346,000,000 163,000,000 (36,000,000) (190,000,000)
30-Sep N/A 305,000,000 114,000,000 (86,000,000) (217,000,000)
31-Dec 347,000,000 261,000,000 65,000,000 (137,000,000) (244,000,000)
QUARTER ENDING 2001 2002 2003 2004 2005
-------------- ---- ---- ---- ---- ----
31-Mar (249,000,000) (254,000,000) (184,000,000) (51,000,000) 119,000,000
30-Jun (255,000,000) (240,000,000) (153,000,000) (11,000,000) 168,000,000
30-Sep (261,000,000) (227,000,000) (123,000,000) 30,000,000 217,000,000
31-Dec (267,000,000) (214,000,000) (92,000,000) 71,000,000 266,000,000
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ANNEX C
Schedule 6.01(r)
Maximum Ratio of Total Consolidated Liabilities to Total Consolidated Assets
QUARTER ENDING 1996 1997 1998 1999 2000
-------------- ---- ---- ---- ---- ----
31-Mar N/A 0.70:1.00 1.10:1.00 1.30:1.00 1.40:1.00
30-Jun N/A 0.80:1.00 1.10:1.00 1.30:1.00 1.40:1.00
30-Sep N/A 0.80:1.00 1.10:1.00 1.30:1.00 1.40:1.00
31-Dec 1.00:1.00 0.80:1.00 1.10:1.00 1.30:1.00 1.40:1.00
QUARTER ENDING 2001 2002 2003 2004 2005
-------------- ---- ---- ---- ---- ----
31-Mar 1.40:1.00 1.40:1.00 1.30:1.00 1.20:1.00 1.10:1.00
30-Jun 1.40:1.00 1.40:1.00 1.30:1.00 1.20:1.00 1.10:1.00
30-Sep 1.40:1.00 1.40:1.00 1.30:1.00 1.20:1.00 1.10:1.00
31-Dec 1.40:1.00 1.30:1.00 1.20:1.00 1.10:1.00 1.00:1.00
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ANNEX D
Schedule 6.01(s)
Minimum PCS Subscribers
Quarter Ending 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
---------------- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
31-Mar N/A 30,000 110,000 290,000 510,000 700,000 840,000 960,000 1,060,000 1,150,000
30-Jun N/A 45,000 140,000 340,000 560,000 730,000 870,000 980,000 1,090,000 1,170,000
30-Sep N/A 65,000 170,000 400,000 610,000 770,000 900,000 1,010,000 1,110,000 1,190,000
31-Dec 5,000 85,000 200,000 460,000 660,000 810,000 930,000 1,040,000 1,140,000 1,210,000
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ANNEX E
Schedule 6.01(t)
Ratio of Consolidated EBITDA to Consolidated Debt Service
QUARTER ENDING 1999 2000 2001 2002 2003 2004 2005
-------------- ---- ---- ---- ---- ---- ---- ----
31-Mar N/A 1.00:4.00 3.00:4.00 1.00:1.00 1.25:1.00 1.50:1.00 0.50:1.00
30-Jun N/A 1.00:1.00 1.00:1.00 1.00:1.00 1.25:1.00 1.50:1.00 0.50:1.00
30-Sep 1.00:8.00 1.00:1.00 1.00:1.00 1.00:1.00 1.25:1.00 1.50:1.00 0.50:1.00
31-Dec 1.00:4.00 1.00:1.00 1.00:1.00 1.00:1.00 1.25:1.00 1.50:1.00 0.50:1.00
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ANNEX F
Schedule 6.01(u)
Ratio of Consolidated Total Debt to Annualized Consolidated EBITDA
QUARTER ENDING 1999 2000 2001 2002 2003 2004 2005
-------------- ---- ---- ---- ---- ---- ---- ----
31-Mar N/A 50.00:1.00 9.00:1.00 7.00:1.00 5.00:1.00 4.00:1.00 4.00:1.00
30-Jun N/A 14.00:1.00 8.00:1.00 6.00:1.00 5.00:1.00 4.00:1.00 4.00:1.00
30-Sep 175.00:1.00 10.00:1.00 7.00:1.00 6.00:1.00 5.00:1.00 4.00:1.00 4.00:1.00
31-Dec 70.00:1.00 10.00:1.00 7.00:1.00 6.00:1.00 5.00:1.00 4.00:1.00 4.00:1.00
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ANNEX G
Schedule 6.01(v)
Maximum Aggregate Capital Expenditures
1999 2000 2001 2002 2003 2004 2005
Maximum Capital Expenditures 772,300,000 841,200,000 893,900,000 971,600,000 1,045,300,000 1,084,800,000 1,162,300,000
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CONSENT
Dated as of March 31, 1997
The undersigned, InterCel, Inc., a Delaware corporation, as Guarantor
under the Parent Guaranty dated October 31, 1996 (the "Parent Guaranty") in
favor of the Agent and, for its benefit and the benefit of the Lenders parties
to the Credit Agreement referred to in the foregoing Amendment, hereby consents
to such Amendment and hereby confirms and agrees that (a) notwithstanding the
effectiveness of such Amendment, the Parent Guaranty is, and shall continue to
be, in full force and effect and is hereby ratified and confirmed in all
respects, and (b) the Collateral Documents to which InterCel, Inc. is a party
and all of the Collateral described therein do, and shall continue to, secure
the payment of all of the Secured Obligations (in each case, as defined
therein).
InterCel, Inc.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel/Atlanta, Inc., a Delaware corporation, as
Guarantor under the Subsidiary Guaranty dated October 31, 1996 (the "Subsidiary
Guaranty") in favor of the Agent and, for its benefit and the benefit of the
Lenders parties to the Credit Agreement referred to in the foregoing Amendment,
hereby consents to such Amendment and hereby confirms and agrees that (a)
notwithstanding the effectiveness of such Amendment, the Subsidiary Guaranty
is, and shall continue to be, in full force and effect and is hereby ratified
and confirmed in all respects, and (b) the Collateral Documents to which
Powertel/Atlanta, Inc. is a party and all of the Collateral described therein
do, and shall continue to, secure the payment of all of the Secured Obligations
(in each case, as defined therein).
Powertel/Atlanta, Inc.
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel Atlanta Licenses, Inc., a Delaware corporation,
as Guarantor under the Subsidiary Guaranty dated October 31, 1996 (the
"Subsidiary Guaranty") in favor of the Agent and, for its benefit and the
benefit of the Lenders parties to the Credit Agreement referred to in the
foregoing Amendment, hereby consents to such Amendment and hereby confirms and
agrees that (a) notwithstanding the effectiveness of such Amendment, the
Subsidiary Guaranty is, and shall continue to be, in full force and effect and
is hereby ratified and confirmed in all respects, and (b) the Collateral
Documents to which Powertel Atlanta Licenses, Inc. is a party and all of the
Collateral described therein do, and shall continue to, secure the payment of
all of the Secured Obligations (in each case, as defined therein).
Powertel Atlanta Licenses, Inc.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel/Birmingham, Inc., a Missouri corporation, as
Guarantor under the Subsidiary Guaranty dated October 31, 1996 (the "Subsidiary
Guaranty") in favor of the Agent and, for its benefit and the benefit of the
Lenders parties to the Credit Agreement referred to in the foregoing Amendment,
hereby consents to such Amendment and hereby confirms and agrees that (a)
notwithstanding the effectiveness of such Amendment, the Subsidiary Guaranty
is, and shall continue to be, in full force and effect and is hereby ratified
and confirmed in all respects, and (b) the Collateral Documents to which
Powertel/Birmingham, Inc. is a party and all of the Collateral described
therein do, and shall continue to, secure the payment of all of the Secured
Obligations (in each case, as defined therein).
Powertel/Birmingham, Inc.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel Birmingham Licenses, Inc., a Colorado
corporation, as Guarantor under the Subsidiary Guaranty dated October 31, 1996
(the "Subsidiary Guaranty") in favor of the Agent and, for its benefit and the
benefit of the Lenders parties to the Credit Agreement referred to in the
foregoing Amendment, hereby consents to such Amendment and hereby confirms and
agrees that (a) notwithstanding the effectiveness of such Amendment, the
Subsidiary Guaranty is, and shall continue to be, in full force and effect and
is hereby ratified and confirmed in all respects, and (b) the Collateral
Documents to which Powertel Birmingham Licenses, Inc. is a party and all of the
Collateral described therein do, and shall continue to, secure the payment of
all of the Secured Obligations (in each case, as defined therein).
Powertel Birmingham Licenses, Inc.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel/Jacksonville, Inc., a Delaware corporation, as
Guarantor under the Subsidiary Guaranty dated October 31, 1996 (the "Subsidiary
Guaranty") in favor of the Agent and, for its benefit and the benefit of the
Lenders parties to the Credit Agreement referred to in the foregoing Amendment,
hereby consents to such Amendment and hereby confirms and agrees that (a)
notwithstanding the effectiveness of such Amendment, the Subsidiary Guaranty
is, and shall continue to be, in full force and effect and is hereby ratified
and confirmed in all respects, and (b) the Collateral Documents to which
Powertel/Jacksonville, Inc. is a party and all of the Collateral described
therein do, and shall continue to, secure the payment of all of the Secured
Obligations (in each case, as defined therein).
Powertel/Jacksonville, Inc.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel Jacksonville Licenses, Inc., a Delaware
corporation, as Guarantor under the Subsidiary Guaranty dated October 31, 1996
(the "Subsidiary Guaranty") in favor of the Agent and, for its benefit and the
benefit of the Lenders parties to the Credit Agreement referred to in the
foregoing Amendment, hereby consents to such Amendment and hereby confirms and
agrees that (a) notwithstanding the effectiveness of such Amendment, the
Subsidiary Guaranty is, and shall continue to be, in full force and effect and
is hereby ratified and confirmed in all respects, and (b) the Collateral
Documents to which Powertel Jacksonville Licenses, Inc. is a party and all of
the Collateral described therein do, and shall continue to, secure the payment
of all of the Secured Obligations (in each case, as defined therein).
Powertel Jacksonville Licenses, Inc.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel/Memphis, Inc., a Delaware corporation, as
Guarantor under the Subsidiary Guaranty dated October 31, 1996 (the "Subsidiary
Guaranty") in favor of the Agent and, for its benefit and the benefit of the
Lenders parties to the Credit Agreement referred to in the foregoing Amendment,
hereby consents to such Amendment and hereby confirms and agrees that (a)
notwithstanding the effectiveness of such Amendment, the Subsidiary Guaranty
is, and shall continue to be, in full force and effect and is hereby ratified
and confirmed in all respects, and (b) the Collateral Documents to which
Powertel/Memphis, Inc. is a party and all of the Collateral described therein
do, and shall continue to, secure the payment of all of the Secured Obligations
(in each case, as defined therein).
Powertel/Memphis, Inc.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Title: Chief Operating Officer
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CONSENT
Dated as of March 31, 1997
The undersigned, Powertel Memphis Licenses, Inc., a Delaware corporation,
as Guarantor under the Subsidiary Guaranty dated October 31, 1996 (the
"Subsidiary Guaranty") in favor of the Agent and, for its benefit and the
benefit of the Lenders parties to the Credit Agreement referred to in the
foregoing Amendment, hereby consents to such Amendment and hereby confirms and
agrees that (a) notwithstanding the effectiveness of such Amendment, the
Subsidiary Guaranty is, and shall continue to be, in full force and effect and
is hereby ratified and confirmed in all respects, and (b) the Collateral
Documents to which Powertel Memphis Licenses, Inc. is a party and all of the
Collateral described therein do, and shall continue to, secure the payment of
all of the Secured Obligations (in each case, as defined therein).
Powertel Memphis Licenses, Inc.
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Title: Chief Operating Officer
