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EXHIBIT 10.4
CONSENT AND AMENDMENT XX. 0
XXXXXXX XXX XXXXXXXXX XX. 0, dated as of July 8, 1999 (this
"Agreement"), by and among WORLDPORT INTERNATIONAL, INC., a Delaware corporation
(the "Company"), WORLDPORT COMMUNICATIONS, INC., a Delaware corporation (the
"Parent"), the Lenders (as defined in the Credit Agreement) which are a party
hereto and BANKERS TRUST COMPANY, as Administrative Agent (in such capacity, the
"Administrative Agent") and Collateral Agent (in such capacity, the "Collateral
Agent") and as joint creditor with the other Lenders under the Credit Agreement,
as defined below.
W I T N E S S E T H:
WHEREAS, the Company and the Parent are parties to a Credit Agreement
dated as of June 23, 1998 (as amended, modified, supplemented and as in effect,
the "Credit Agreement") with the Lenders, the Administrative Agent and the
Collateral Agent;
WHEREAS, pursuant to the Credit Agreement, the Lenders made certain
term loans to the Company in the aggregate principal amount of up to
$120,000,000 (the "Term Loan"), as evidenced by the Term Notes (as defined in
the Credit Agreement);
WHEREAS, the Term Notes were originally scheduled to mature on June 23,
1999 (the "Maturity Date");
WHEREAS, the Administrative Agent and the Lenders agreed by letter
dated as of June 23, 1999 to extend the Maturity Date until July 1, 1999 and by
letter dated as of July 1, 1999 to further extend the Maturity Date until July
8, 1999, during which such extension periods the Company and the Parent were
required to negotiate in good faith with the Administrative Agent to enter into
an amendment to the Credit Agreement to further extend the Maturity Date; and
WHEREAS, the Company and the Parent have requested that, subject to the
terms and provisions hereof, the Maturity Date be extended to August 18, 1999.
NOW THEREFORE, in consideration of the foregoing premises and for other
good and valuable consideration, the sufficiency of which is hereby
acknowledged, the parties hereto agree to the following:
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1. Defined Terms. Capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed thereto in the Credit
Agreement.
2. Consent. Subject to Section 4 of this Agreement, the
Administrative Agent and the Lenders hereby consent to an extension of the
Maturity Date to August 18, 1999.
3. Amendments. Effective on the Effective Date (as herein
defined):
A. The following definitions are hereby added to Section
1.1 of the Credit Agreement in their appropriate alphabetical order:
"Consent and Amendment No. 8" means Consent and
Amendment No. 8 to this Agreement, dated as of July 8, 1999,
by and among the Company, the Parent, the Lenders party
thereto, the Administrative Agent and the Collateral Agent.
"Heico Equity Investment" shall mean the July 1999
Investment, the Optional Investment (if any), the Total Equity
Investment and the Additional Equity Investment (if any).
"July 1999 Equity Documents" shall mean those
documents and agreements in form and substance, and upon terms
and conditions, reasonably satisfactory to the Administrative
Agent and the Lenders and attached as Exhibit 1 to Consent and
Amendment No. 8, together with all other documents and
agreements executed and delivered in connection therewith, in
each case as amended, modified or supplemented from time to
time in accordance with, and subject to the terms of, this
Agreement.
"July 1999 Investment" shall mean the purchase, if
any, by Heico or such other investor reasonably satisfactory
to the Administrative Agent and the Lenders of equity of the
Parent for a purchase price of not less than $15,000,000,
pursuant to the July 1999 Equity Documents, which equity shall
not dilute the Warrants, and the holders of the Warrants shall
be afforded anti-dilution protection in accordance with
Section 5.24.
"July 1999 Investment Proceeds" shall mean the
proceeds received by the Parent from the consummation of the
July 1999 Investment in an amount not less than
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$15,000,000 (which may include proceeds of the Additional
Equity Investment).
"Optional Investment" shall mean the additional
purchase of equity of the Parent which is made pursuant to
Section 5.22, if any.
B. Section 2.8(a)(i) of the Credit Agreement is hereby
amended by restating in its entirety the last sentence thereof to read as
follows:
"Notwithstanding the foregoing provisions of this
Section 2.8(a)(i), the consummation of the Initial Heico
Investment, the consummation of the Second Heico Investment,
if any, the consummation of the Total Equity Investment, the
consummation of the Additional Equity Investment, if any, the
consummation of the July 1999 Investment, if any, and the
consummation of the Optional Investment, if any, shall not
constitute an Asset Sale for purposes of this Section
2.8(a)(i)."
C. Section 2.8(d) of the Credit Agreement is hereby
amended by restating subclause (v) therein in its entirety to read as follows:
"(v) Notwithstanding the foregoing provisions of this
Section 2.8(d), a Change of Control shall not be deemed to
have occurred as a result of the consummation of the Initial
Heico Investment, the consummation of the Second Heico
Investment, if any, the consummation of the Total Equity
Investment, the consummation of the Additional Equity
Investment, if any, the consummation of the July 1999
Investment, if any, the consummation of the Optional
Investment, if any, and the appointment and/or election of the
Board of Directors of the Parent and its Subsidiaries
contemplated by the Heico Equity Documents."
D. Article V of the Credit Agreement is amended by
inserting the following new Sections 5.22, 5.23 and 5.24 after Section 5.21:
Section 5.22 Acceptance of Optional Investment. In
addition to the obligations of the Parent under Section 5.21,
the Parent covenants and agrees that, in the event Heico
offers to make additional investments in the Parent by
purchasing an additional amount of equity of the Parent in an
aggregate amount up to $15,000,000 (in addition to Total
Equity Investment Proceeds, the proceeds
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of equity investments in the Parent required to be sold
pursuant to Section 5.21 and the proceeds of the July 1999
Investment), which new equity shall be in the same form and
substance, and upon the same terms and conditions, as the
Total Equity Investment or otherwise reasonably acceptable to
the Lenders, the Parent shall sell such additional equity to
Heico at each such time the investor desires to purchase such
additional equity; provided, however, that all such new equity
investments shall not dilute the Warrants, and the holders of
the Warrants shall be afforded anti-dilution protection in
accordance with Section 5.24.
Section 5.23 Preparation for Sale of Business.
(i) Not later than July 9, 1999, the
Parent shall (A) have hired and formally engaged an investment
banking firm (the "Advisor") reasonably acceptable to the
Administrative Agent and the Lenders to commence preparations
for the sale of the Parent's business, including, but not
limited to, the sale of Enertel in the event that the Lenders
are entitled to exercise their rights and remedies under the
Finance Documents and (B) have delivered to the Administrative
Agent an engagement letter between the Parent and the Advisor
in connection with such engagement, in form and substance
reasonably satisfactory to the Administrative Agent, which
shall include a mandate to the Advisor that it shall take
immediate steps to commence the sale and marketing process by
August 9, 1999 and take all customary actions which would be
expected to be taken by investment bankers in their sale and
marketing efforts for companies in order to complete and
achieve the sale of the Parent and its subsidiaries
(including, without limitation, completing the offering
memorandum for such sale, preparing and coordinating due
diligence materials and commencing discussions with potential
buyers).
(ii) In conjunction with this engagement
of the Advisor required under this Section 5.23, a committee
consisting of one or more representatives of the Lenders
and/or the Administrative Agent shall be afforded the ongoing
opportunity to consult with the Advisor and representatives of
the Parent regarding the duties and scope of work of the
Advisor and to be consulted on an ongoing basis (including,
without limitation, being informed of material
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discussions and meetings among and between the Parent, Heico
and the Advisor) and given the opportunity to participate
therein.
Section 5.24 No Dilution. The Parent shall issue to
each holder of Warrants (each, a "Holder") and to each Holder
who holds Common Stock issued pursuant to any previous
exercise of Warrants additional Warrants as of each Heico
Funding Date (without duplication of any additional Warrants
which may have already been issued to such Holder in respect
of the Total Equity Investment), upon demand of such Holder
after each such date, so that the aggregate percentage of the
Fully Diluted Common Stock of the Parent represented by all
Warrants and Common Stock issued pursuant to any previous
exercise of Warrants as of such date equals eleven percent
(11%) of the Fully Diluted Common Stock of the Parent. Each
Holder will be entitled to its pro rata percentage of any
additional Warrants issued as of such Heico Funding Date,
calculated by multiplying (a) a fraction, the numerator of
which shall be the total number of Warrants (excluding any
additional Warrants) and Common Stock issued pursuant to any
previous exercise of Warrants held by such Holder as of such
Heico Funding Date and the denominator of which shall be the
total number of Warrants and Common Stock issued pursuant to
any previous exercise of Warrants held by all Holders as of
such Heico Funding Date (excluding any additional Warrants),
times (b) the aggregate number of additional Warrants to be
issued as of such Heico Funding Date in order to satisfy the
first sentence of this Section 5.24.
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For purposes of this Section 5.24, (i) the term
"Fully Diluted Common Stock" shall mean, as of the date
determined, the aggregate number of shares of issued and
outstanding Common Stock of the Parent after taking into
account the conversion of all issued and outstanding
securities convertible into Common Stock of the Parent and the
exercise of all issued and outstanding warrants and options
for Common Stock (or securities convertible into Common Stock)
of the Parent, including the Warrants (but excluding any
additional Warrants issued pursuant to this Section 5.24 which
were not outstanding prior to the Heico Funding Date for which
such calculation is being made) and (ii) the term "Heico
Funding Date" means each date on which a Heico Equity
Investment is made during the period in which Obligations are
outstanding.
E. Section 7.1(b) is amended by adding the references
",5.22, 5.23, 5.24" after the reference to "5.21" appearing
therein.
F. Section 6.21(b) of the Credit Agreement is amended by
(i) adding the phrase, "any July 1999 Equity Document"
immediately after the phrase "Heico Registration Rights
Agreement" appearing therein and (ii) adding the following to
the end thereof prior to the semi-colon:
", provided, that the Parent may amend its
certificate of incorporation for the purpose of adding one or
more Certificate(s) of Designation for the equity to be
purchased by Heico or such other investor reasonably
satisfactory to the Lenders pursuant to the Initial Heico
Investment, the Second Heico Investment (if any), the Total
Equity Investment, the Additional Equity Investment (if any),
the July 1999 Investment (if any) and the Optional Investment
(if any), which Certificate(s) of Designation shall contain
terms consistent with the terms and provisions of the Heico
Equity Documents and the July 1999 Equity Documents, as the
case may be, and may amend the by-laws of the Parent to make
modifications thereto consistent with the terms of the Heico
Equity Documents and the July 1999 Equity Documents, as the
case may be."
4. Conditions to Effectiveness. The effectiveness of
this Agreement (such date of effectiveness, the "Effective Date") is subject to
the satisfaction of the following conditions precedent:
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(a) Execution of this Agreement. Each of the Parent, the
Company, the Administrative Agent, the Collateral Agent and the Lenders
shall have executed and delivered this Agreement.
(b) Equity Proceeds. The Parent shall have received gross
proceeds of not less than $15,000,000 (the "July 1999 Investment
Proceeds") (which may include proceeds of the Additional Equity
Investment) from the purchase of equity of the Parent by Heico, which
new equity shall be in the same form and substance, and upon the same
terms and conditions, as the Total Equity Documents or otherwise
reasonably acceptable to the Administrative Agent and the Lenders (the
"July 1999 Investment"). As of the Effective Date, the July 1999
Investment shall have been consummated in accordance with the terms and
conditions of the July 1999 Equity Documents and all applicable laws.
As of the Effective Date, there does not exist any judgment, order, or
injunction prohibiting the consummation of the July 1999 Investment or
the performance by the Parent of its obligations under the July 1999
Equity Documents. The July 1999 Equity Documents (and the transactions
contemplated thereby) shall have been duly approved by the boards of
directors and, if required by applicable law, the stockholders of the
parties thereto, and all July 1999 Equity Documents shall have been
duly executed and delivered by the parties thereto and shall be in full
force and effect. Other than the effectiveness of this Agreement, each
of the conditions precedent to the obligation of the parties to
consummate the July 1999 Investment as set forth in the July 1999
Equity Documents shall have been satisfied to the reasonable
satisfaction of the Administrative Agent, or waived with the consent
(which consent shall not be unreasonably withheld or delayed) of the
Administrative Agent and the July 1999 Investment shall have been
consummated in accordance with the July 1999 Equity Documents (without
giving effect to any amendment or modification of the July 1999 Equity
Documents or waiver with respect thereto unless consented to by the
Administrative Agent (which consent shall not be unreasonably withheld
or delayed)) and all applicable laws, rules and regulations.
(c) Representations and Warranties. The representations
and warranties of the Parent set forth in Section 5 of this Agreement
shall be true and correct in all material respects on the Effective
Date.
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(d) Hiring of CEO. The Company shall have hired Xxxx
Xxxxxxx as chief executive officer and the terms of his employment
agreement shall be reasonably satisfactory to the Administrative Agent
and the Lenders.
5. Representations and Warranties. The Parent hereby represents
and warrants to the Agent and the Lenders that (i) each of the July
1999 Equity Documents constitutes the legal, valid and binding
obligation of the Parent, enforceable against the Parent in accordance
with its terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws now or
hereinafter in effect affecting the enforcement of creditors' rights
generally and by general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and (ii) all
corporate action on the part of the Parent, its directors and
shareholders necessary for the authorization, execution, delivery and
performance by the Parent of the July 1999 Equity Documents, and the
consummation of the transactions contemplated thereby, and for the
authorization, issuance and delivery of the equity to be issued
pursuant thereto, has been taken.
6. Applicable Law; Submission to Jurisdiction. THIS AGREEMENT
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
7. No Novation. This Agreement shall not extinguish the
obligations for the payment of money outstanding under the Credit
Agreement or any Note or discharge or release the Lien or priority of
any security agreement, any pledge agreement or any other security
therefor or discharge any obligation under any guaranty. Nothing herein
contained shall be construed as a substitution or novation of the
Obligations outstanding under the Credit Agreement or instruments
securing the same, which shall remain in full force and effect, except
as modified hereby or by instruments executed concurrently herewith.
Nothing expressed or implied in this Agreement, the Credit Agreement,
or any other document contemplated hereby or thereby shall be construed
as a release or other discharge of the Company, the Parent or any
Guarantor under the Credit Agreement or any Pledgor or Grantor under
any Security Document from any of its obligations and liabilities as a
"Company", "Parent", "Guarantor", "Pledgor" or "Grantor" under the
Credit Agreement or the Security Documents or any other Finance
Document. Whenever the term "Credit Agreement" is used in any of the
Finance Documents it shall mean and refer to the Credit Agreement as
modified pursuant hereto. Each of the Credit
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Agreement and the other Finance Documents shall remain in full force
and effect, except as expressly modified hereby.
8. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of
which when taken together shall constitute but one contract.
9. Headings. The headings of this Agreement are for convenience
of reference only, are not part of this Agreement and are not to affect
the construction of, or to be taken into consideration in interpreting,
this Agreement.
10. Payment of Expenses. In furtherance of the provisions of
Section 9.1 of the Credit Agreement, the Parent and Company shall
jointly and severally, whether or not the transactions hereby
contemplated are consummated, upon demand of the Agent pay all
reasonable out-of-pocket costs (including legal fees), charges and
expenses of the Agent in connection with the negotiation, preparation,
execution and delivery of this Agreement (including, without
limitation, all such out-of-pocket costs (including legal fees),
charges and expenses in connection with matters relating to the July
1999 Investment, and the documents and instruments referred to herein,
and otherwise reviewed in connection herewith and therewith).
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized officers, all as of the date and year
first above written.
WORLDPORT COMMUNICATIONS, INC.
By:
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Name:
Title:
WORLDPORT INTERNATIONAL, INC.
By:
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Name:
Title:
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BANKERS TRUST COMPANY,
as Administrative Agent and Collateral Agent
By:
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Name:
Title:
BANKERS TRUST CORPORATION,
as Lender
By:
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Name:
Title:
DREYFUS PREMIER LIMITED TERM HIGH INCOME FUND
By:
-----------------------------------------
Name:
Title:
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ACKNOWLEDGED AND AGREED TO:
CIBC XXXXXXXXXXX CORP.,
as Participant
By:
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Name:
Title:
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ACKNOWLEDGED AND AGREED TO:
Continental Casualty Company,
as Participant
By:
--------------------------
Name:
Title:
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ACKNOWLEDGED AND AGREED TO:
Northstar High Total Return Fund,
as Participant
By:
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Name:
Title:
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ACKNOWLEDGED AND AGREED TO:
Northstar High Total Return Fund II,
as Participant
By:
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Name:
Title:
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ACKNOWLEDGED AND AGREED TO:
UNITED Bank OF SWITZERLAND, London Branch,
as Participant
By:
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Name:
Title:
By:
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Name:
Title:
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