EXHIBIT 4.8
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CREDIT AGREEMENT,
dated as of
November 25, 1998
among
MID-ATLANTIC CROSSING LTD.,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS,
as the Lenders,
DEUTSCHE BANK AG, NEW YORK BRANCH
and
CIBC INC.,
as the Lead Agents,
DEUTSCHE BANK AG, NEW YORK BRANCH,
as the Administrative Agent,
CANADIAN IMPERIAL BANK OF COMMERCE,
as the Syndication Agent,
and
CIBC INC.
as the Documentation Agent.
__________________________________________
DEUTSCHE BANK SECURITIES INC.
and
CIBC XXXXXXXXXXX CORP.
as the Co-Arrangers
Construction, Working Capital and Term Financing of the
Mid-Atlantic Crossing Fiber Optic Submarine Cable System
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TABLE OF CONTENTS
ARTICLE I. DEFINITIONS...................................................................................2
SECTION 1.01. Defined Terms...................................................................2
SECTION 1.02. Classification of Loans and Borrowings.........................................37
SECTION 1.03. Terms Generally................................................................37
SECTION 1.04. Accounting Terms; Exchange Rates...............................................38
ARTICLE II. THE COMMITMENTS.............................................................................38
SECTION 2.01. Commitments....................................................................38
SECTION 2.02. Loans and Borrowings...........................................................39
SECTION 2.03. Requests for Borrowings and Other Credit Extensions............................39
SECTION 2.04. Special Provisions for Credit Extensions.......................................40
SECTION 2.05. Funding Of Borrowings..........................................................42
SECTION 2.06. Interest Elections.............................................................43
SECTION 2.07. Termination and Reduction of Commitments.......................................44
SECTION 2.08. Repayment of Loans; Evidence of Debt...........................................44
SECTION 2.09. Optional Prepayments of Loans..................................................46
SECTION 2.10. Mandatory Prepayments..........................................................46
SECTION 2.11. Fees...........................................................................48
SECTION 2.12. Interest.......................................................................48
SECTION 2.13. Alternate Rate of Interest; Illegality.........................................49
SECTION 2.14. Increased Costs................................................................50
SECTION 2.15. Break Funding Payments.........................................................51
SECTION 2.16. Taxes..........................................................................51
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs....................53
SECTION 2.18. Mitigation Obligations; Replacement of Lenders.................................54
ARTICLE III. REPRESENTATIONS AND WARRANTIES.............................................................56
SECTION 3.01. Financial Condition............................................................56
SECTION 3.02. No Change......................................................................56
SECTION 3.03. Organization; Powers...........................................................56
SECTION 3.04. Authorization; Enforceability..................................................56
SECTION 3.05. Corporate Structure............................................................57
SECTION 3.06. Compliance with Law............................................................57
SECTION 3.07. No Legal Bar...................................................................57
SECTION 3.08. Governmental Actions...........................................................57
SECTION 3.09. Litigation.....................................................................58
SECTION 3.10. Environmental Matters..........................................................58
SECTION 3.11. No Default; Event of Default...................................................58
SECTION 3.12. Properties.....................................................................58
SECTION 3.13. Taxes..........................................................................59
SECTION 3.14. Federal Regulations............................................................59
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SECTION 3.15. ERISA..........................................................................59
SECTION 3.16. Investment Company Act.........................................................59
SECTION 3.17. Security Documents.............................................................59
SECTION 3.18. Chief Executive Office.........................................................60
SECTION 3.19. Disclosure.....................................................................60
SECTION 3.20. Sufficiency of System Contracts................................................61
SECTION 3.21. Immunity.......................................................................61
SECTION 3.22. Export Control.................................................................61
SECTION 3.23. Foreign Corrupt Practices Act..................................................61
SECTION 3.24. Intellectual Property..........................................................61
SECTION 3.25. No Additional Fees.............................................................61
SECTION 3.26. Year 2000......................................................................62
SECTION 3.27. Landing License................................................................62
ARTICLE IV. CONDITIONS..................................................................................62
SECTION 4.01. Conditions Precedent to the First Loan.........................................62
SECTION 4.02. Conditions Precedent to Subsequent Credit Extensions...........................68
ARTICLE V. AFFIRMATIVE COVENANTS........................................................................72
SECTION 5.01. Financial Statements and Other Information.....................................72
SECTION 5.02. Reports........................................................................73
SECTION 5.03. Payment of Obligations.........................................................74
SECTION 5.04. Conduct of Business; System Completion.........................................75
SECTION 5.05. Existence......................................................................75
SECTION 5.06. Compliance with Laws...........................................................75
SECTION 5.07. Performance of Agreements......................................................75
SECTION 5.08. Taxes and Claims...............................................................75
SECTION 5.09. Notices........................................................................76
SECTION 5.10. Insurance......................................................................76
SECTION 5.11. Fiscal Year....................................................................76
SECTION 5.12. Use of Proceeds................................................................76
SECTION 5.13. Environmental Matters..........................................................77
SECTION 5.14. Operating Budgets; Operating Plans.............................................77
SECTION 5.15. Governmental Actions...........................................................78
SECTION 5.16. Cooperation with Independent Engineer..........................................78
SECTION 5.17. Spare Parts....................................................................78
SECTION 5.18. Interest Rate Protection.......................................................78
SECTION 5.19. Maintenance of Process Agent...................................................79
SECTION 5.20. System Operation and Maintenance...............................................79
SECTION 5.21. Event of Loss..................................................................79
SECTION 5.22. Books and Records; Inspection Rights...........................................79
SECTION 5.23. Export Control.................................................................79
SECTION 5.24. Foreign Corrupt Practices Act..................................................80
SECTION 5.25. Further Assurances.............................................................80
SECTION 5.26. Intellectual Property..........................................................80
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SECTION 5.27. Certain Additional Material Contracts..........................................80
SECTION 5.28. Upgradeability.................................................................81
SECTION 5.29. First Permitted Upgrade........................................................81
ARTICLE VI. NEGATIVE COVENANTS..........................................................................81
SECTION 6.01. Indebtedness...................................................................81
SECTION 6.02. Liens..........................................................................82
SECTION 6.03. Fundamental Changes............................................................83
SECTION 6.04. Sale of Assets.................................................................83
SECTION 6.05. Investments, Loans, Advances, Guarantees and Acquisitions......................83
SECTION 6.06. Restricted Payments............................................................85
SECTION 6.07. Amendment of System Contracts, Etc.............................................86
SECTION 6.08. Supply Contracts...............................................................87
SECTION 6.09. Addition to Configuration......................................................89
SECTION 6.10. Permitted System Upgrades......................................................89
SECTION 6.11. Leases.........................................................................89
SECTION 6.12. Change of Office...............................................................89
SECTION 6.13. Change of Name.................................................................90
SECTION 6.14. Transactions with Affiliates...................................................90
SECTION 6.15. Sale and Leaseback.............................................................90
SECTION 6.16. Approval of Additional Contracts...............................................90
SECTION 6.17. Capital Expenditures...........................................................91
SECTION 6.18. Limitations on Transfer and Issuance of Interests..............................91
SECTION 6.19. Unrelated Activities; Abandonment..............................................91
SECTION 6.20. Set-off........................................................................91
SECTION 6.21. Changes in Capital Budget......................................................91
SECTION 6.22. Payment of Construction Costs..................................................92
SECTION 6.23. Sales of Capacity..............................................................92
SECTION 6.24. Financial Covenants............................................................93
SECTION 6.25. Amendments, Etc. of Organizational and Other Documents.........................94
SECTION 6.26. Management and Advisory Fees, Etc..............................................95
SECTION 6.27. Immunity.......................................................................95
SECTION 6.28. Amendments to Operating Budget.................................................95
SECTION 6.29. Backhaul.......................................................................95
SECTION 6.30. Exchange Rate Risk.............................................................96
ARTICLE VII. EVENTS OF DEFAULT..........................................................................96
SECTION 7.01. Non-Payment of Obligations.....................................................96
SECTION 7.02. Breach of Warranty.............................................................96
SECTION 7.03. Non-Performance of Certain Covenants and Obligations...........................96
SECTION 7.04. Involuntary Bankruptcy Proceeding, Etc.........................................97
SECTION 7.05. Voluntary Bankruptcy Proceeding, Etc...........................................98
SECTION 7.06. Judgments......................................................................98
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SECTION 7.07. ERISA..........................................................................98
SECTION 7.08. Impairment of Security, Etc....................................................98
SECTION 7.09. Commercial Operation...........................................................99
SECTION 7.10. Impairment of System Contract..................................................99
SECTION 7.11. Default Under System Contract..................................................99
SECTION 7.12. Liquidated Damages.............................................................99
SECTION 7.13. Revocation of Landing License, Etc.............................................100
SECTION 7.14. Change in Control..............................................................100
SECTION 7.15. Default on Other Indebtedness..................................................100
SECTION 7.16. Delay in Construction or Installation..........................................100
SECTION 7.17. Limitations Regarding St. Croix Affiliate......................................100
SECTION 7.18. Limitations Regarding Global Networks..........................................101
SECTION 7.19. Remedies.......................................................................101
ARTICLE VIII. THE ADMINISTRATIVE AGENT, OTHER AGENTS AND AGENT RELATED PERSONS..........................101
SECTION 8.01. Authorization and Action.......................................................101
SECTION 8.02. Exculpation of, and Reliance by, Agents and Agent Related Persons..............102
SECTION 8.03. Agents, Agent Related Persons and Affiliates...................................103
SECTION 8.04. Lender Credit Decision.........................................................103
SECTION 8.05. Indemnification................................................................103
SECTION 8.06. Collateral Matters.............................................................104
SECTION 8.07. Successor Administrative Agent.................................................105
ARTICLE IX. MISCELLANEOUS...............................................................................106
SECTION 9.01. Notices........................................................................106
SECTION 9.02. Waivers; Amendments............................................................106
SECTION 9.03. Expenses; Indemnity; Damage Waiver.............................................107
SECTION 9.04. Successors and Assigns; Consent and Agreement..................................109
SECTION 9.05. Limited Recourse...............................................................112
SECTION 9.06. Survival.......................................................................112
SECTION 9.07. Counterparts; Integration; Effectiveness.......................................112
SECTION 9.08. Severability...................................................................112
SECTION 9.09. Right of Setoff................................................................113
SECTION 9.10. Governing Law; Jurisdiction; Consent to Service of Process.....................113
SECTION 9.11. WAIVER OF JURY TRIAL...........................................................113
SECTION 9.12. Headings.......................................................................114
SECTION 9.13. Replacement of Independent Engineer............................................114
SECTION 9.14. Confidentiality................................................................114
SECTION 9.15. Right of Quiet Enjoyment.......................................................115
SECTION 9.16. Judgment Currency..............................................................115
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SCHEDULES:
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Schedule 1.01 Permitted Reserve L/C Facility
Schedule 2.01 Lenders; Commitments
Schedule 2.08 Principal Amortization Table
Schedule 3.05(a) Borrower Capital Structure
Schedule 3.05(b) Subsidiaries
Schedule 3.05(c) St. Croix Affiliate Capital Structure
Schedule 3.08 Governmental Actions
Schedule 3.13 Taxes
Schedule 3.17 Filings and Other Actions
Schedule 4.02(f) Milestones
Schedule 5.10 Insurance
EXHIBITS:
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Exhibit A-1 Form of Tranche A-1 Term Note
Exhibit A-2 Form of Tranche A-2 Term Note
Exhibit A-3 Form of Working Capital Note
Exhibit B-1 Form of Credit Extension Request
Exhibit B-2 Form of Credit Extension Certificate
Exhibit B-3 Form of Contractor Construction Progress Certificate
Exhibit B-4 Form of Tyco Construction Progress Certificate
Exhibit C Form of Continuation/Conversion Notice
Exhibit D Form of Assignment and Acceptance
Exhibit E Form of Subsidiary Security Agreement
Exhibit F Form of Subsidiary Guaranty Agreement
Exhibit G Form of Closing Date Certificate
Exhibit H Form of Supplement No. 2 to the Alcatel Supply Contract
Exhibit I Form of Capacity Sales Agreement
Exhibit J-1 Form of Legal Opinion of Xxxxxxx, Xxxxxxxx & Xxxxx
Exhibit J-2 Form of Legal Opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx
Exhibit J-3 Form of Legal Opinion of Xxxxxx and Co.
Exhibit J-4 Form of Legal Opinion of Xxxxx Xxxxx
Exhibit J-5 Form of Legal Opinion of Xxxxxx Xxxxxx-Xxxxxxx
Exhibit J-6 Form of Legal Opinion of Xxxxxxx & Xxxxxxxx LLP
Exhibit J-7 Form of Legal Opinion of Xxxxxxx Xxxxxxxx
Exhibit J-8 Form of Legal Opinion of TSSL's Legal Counsel
Exhibit J-9 Form of Landing License Legal Opinion
Exhibit K-1 Independent Engineer's Report
Exhibit K-2 Form of Independent Engineer's Closing Date Certificate
Exhibit L-1 Market Consultant's Report
Exhibit L-2 Form of Market Consultant's Closing Date Certificate
Exhibit M Budget and Projections
Exhibit N Form of Exemption Certificate
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CREDIT AGREEMENT, dated as of November 25, 1998 (as amended, supplemented,
amended and restated or otherwise modified from time to time, this "Agreement"),
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among MID-ATLANTIC CROSSING LTD., a corporation organized and existing under the
laws of Bermuda (the "Borrower"), the financial institutions from time to time
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parties hereto as lenders (collectively, the "Lenders"), DEUTSCHE BANK AG, NEW
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YORK BRANCH and CIBC INC., acting by and/or through one or more of its branches,
agencies or affiliates, as lead agents for the Lenders (in such capacity, the
"Lead Agents"), DEUTSCHE BANK AG, NEW YORK BRANCH, as administrative agent for
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the Lenders (in such capacity, the "Administrative Agent"), CANADIAN IMPERIAL
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BANK OF COMMERCE, as syndication agent and book runner for the Lenders (in such
capacity, the "Syndication Agent") and CIBC INC., AS DOCUMENTATION AGENT FOR THE
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LENDERS (IN SUCH CAPACITY, THE "DOCUMENTATION AGENT").
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W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in Section 1.01 of this Agreement;
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WHEREAS, the Borrower (together with its Subsidiaries) proposes to develop,
construct, own (and lease), and provide and sell System Capacity on, a subsea
fiber optic ring cable system at a per fiber pair capacity of 20 Gb/s to be
known as the "Mid-Atlantic Crossing Cable System" or "MAC-1," which is intended
to be used to provide telecommunications service among New York, St. Croix and
Florida (as modified from time to time in accordance with the terms hereof, the
"System");
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WHEREAS, in order to provide for the design, construction and installation
of the System, the Borrower has entered into or will enter into the Supply
Contracts with the System Contractors;
WHEREAS, the Contractor's and TSSL's obligations with respect to the Work
under and as defined in the Alcatel Supply Contract and Tyco Supply Contract,
respectively, are being or will be guaranteed by the applicable Supply Contract
Guarantor pursuant to, and subject to the limitations set forth in, the Supply
Contract Guarantees;
WHEREAS, in order to provide for the operation, administration and
maintenance of the System, the Borrower will enter into (i) an O&M Agreement
with the Operator and (ii) a System Management Agreement with the System
Manager;
WHEREAS, in order to finance a portion of the design, development,
construction and installation of the System, the Shareholder has agreed to make
cash equity contributions to the Borrower in an aggregate amount equal to the
Required Equity Contribution;
WHEREAS, in order to finance the remaining portion of the design,
development, construction and installation of the System, the Borrower is
entering into this Agreement, pursuant to which the Lenders have agreed, subject
to the terms and conditions set forth herein, to make certain Credit Extensions
to the Borrower;
WHEREAS, in order to market Capacity, the Borrower has entered into the
Marketing Agreement with the Marketing Agent;
WHEREAS, in furtherance of the foregoing and in order to secure and support
the Borrower's obligations to the Lenders under the Loan Documents, the
Borrower, the U.K. Subsidiary and the U.S. Subsidiary will enter into the
Securities Accounts Agreement which sets forth certain provisions regarding the
deposit and application of System Revenues, Backhaul Revenues and other
proceeds; and
WHEREAS, in order to further secure and support the Borrower's obligations
to the Lenders under the Loan Documents, the Shareholder, the Borrower and the
Subsidiaries will enter into the other Security Documents to which they are
parties (and the Subsidiaries will enter into the Subsidiary Guaranty
Agreements);
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I.
DEFINITIONS
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SECTION 1.01. Defined Terms.
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As used in this Agreement, the following terms shall have the meanings
specified below:
"ABR" when used in reference to any Loan or Borrowing, refers to whether
---
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.
"AC-1 Co-Location Agreement" means the agreement between GC Landing Corp.
--------------------------
and the Borrower pursuant to which GC Landing Corp. will provide the Borrower
(and its Subsidiaries) with the right to use and occupy the Brookhaven, New York
landing station in order to operate the System as contemplated hereby.
"AC-1 Consent" means the consent and agreement to be entered into among GC
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Landing Corp., the AC-1 Lenders, the Borrower and the Administrative Agent
pursuant to which, among other things, (a) the AC-1 Lenders consent to the AC-1
Co-Location Agreement, (b) the AC-1 Lenders agree to recognize and not disturb
the rights of the Borrower and its permitted assigns under the AC-1 Co-Location
Agreement upon the exercise of any rights of the AC-1 Lenders and (c) GC Landing
Corp. and the AC-1 Lenders consent to the assignment by the Borrower to the
Administrative Agent of the Borrower's right, title and interest in, to and
under the AC-1 Co-Location Agreement.
"AC-1 Lenders" means the lenders providing financing in connection with the
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subsea fiber optic cable system being developed by Atlantic Crossing.
2
"Accounts" shall be the collective reference to the Borrower Accounts, the
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U.S. Subsidiary Accounts, the U.K. Subsidiary Accounts, and each other account,
together with each sub-account of any such account, established and maintained
pursuant to the provisions of the Securities Accounts Agreement.
"Actual Date of Commercial Operation" means the date on which the Basic
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System is Ready for Commercial Acceptance or the Basic System is Ready for
Provisional Acceptance and the Borrower receives a Commissioning Report (as
defined in the Alcatel Supply Contract) demonstrating as such.
"Additional Contracts" means any contract entered into by the Borrower or
--------------------
any Subsidiary after the Closing Date (other than employment contracts and
contracts involving payments of less than $1,000,000 annually).
"Additional Material Contract" means each Additional Contract designated as
----------------------------
an "Additional Material Contract" in accordance with Section 6.16.
------------
"Additional Non-Material Contract" means each Additional Contract
--------------------------------
designated as an "Additional Non-Material Contract" in accordance with Section
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6.16.
----
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing for
------------------
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" is defined in the preamble and includes each of its
--------------------
successors and assigns.
"Affiliate" means, with respect to a specified Person, another Person that
---------
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Affiliate Capacity Cash Amount" is defined in Section 6.23.
------------------------------ ------------
"Agent Related Persons" means the Agents, the Lead Agents and their
---------------------
Affiliates and each of their respective officers, directors, partners, agents
and employees.
"Agents" is the collective reference to the Administrative Agent, the
------
Syndication Agent, the Documentation Agent and each Lead Agent.
"Agreement" is defined in the preamble.
--------- --------
"Alcatel" means Alcatel Alsthom, a societe anonyme organized under the laws
-------
of France and the ultimate parent of the Contractor.
"Alcatel Contract Price" means "Contract Price" as defined in the Alcatel
----------------------
Supply Contract.
3
"Alcatel Contract Variation" means any amendment, supplement, waiver,
--------------------------
consent or other modification to the Alcatel Supply Contract and shall include
any "Contract Variation" as such term is defined in the Alcatel Supply Contract.
"Alcatel Contractor Consent" means the Consent and Agreement, dated as of
--------------------------
November 25, 1998, among the Borrower, the Contractor and the Administrative
Agent and, with respect to any supply contract permitted to replace the Alcatel
Supply Contract in accordance with Section 7.11, any replacement consent and
------------
agreement reasonably acceptable to the Administrative Agent and relating to such
new supply contract.
"Alcatel Escrow Agent" means the escrow agent under the Contractor Escrow
--------------------
Agreement in connection with the Alcatel Supply Contract, and each of its
successors and assigns as such thereunder.
"Alcatel Escrow Dispute Account" means the "Dispute Account" as defined in
------------------------------
the Contractor Escrow Agreement in connection with the Alcatel Supply Contract.
"Alcatel Guarantee" means the Guaranty, dated as of June 2, 1998, made by
-----------------
Alcatel in favor of the Borrower.
"Alcatel Plan of Work" means the plan of work attached as Appendix 3 to the
--------------------
Alcatel Supply Contract.
"Alcatel Supply Contract" means the Project Development and Construction
-----------------------
Contract, dated as of June 2, 1998, between the Contractor and the Borrower, as
supplemented pursuant to the Supplement No. 1 dated as of October 1, 1998,
between the Contractor and the Borrower and as modified by the letter from GCDC
to Alcatel Submarine Networks dated as of October 26, 1998.
"Alternate Base Rate" means, for any day, a rate per annum equal to the
-------------------
greatest of (a) the Prime Rate in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Percentage" means, with respect to any Lender, the percentage
---------------------
of the total Commitments represented by such Lender's Commitments or, with
respect to any Lender and a given Class of Commitments, the percentage of the
total commitments of such Class represented by such Lender's Commitments. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect prior to such
termination or expiration, giving effect to any assignments.
"Applicable Rate" means, for any day, with respect to any ABR Loans or
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Eurodollar Loans, the applicable rate per annum set forth below under the
caption "ABR Spread" or "Eurodollar Spread," as the case may be:
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ABR Spread Eurodollar Spread
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(i) with respect to Term Loans: 2.00% 3.00%
(ii) with respect to Working Capital Loans: 2.00% 3.00%
On the Interest Payment Date occurring on or immediately following the First
Sales Threshold Date, each of the Applicable Rates set forth above shall be
reduced by 0.25% per annum; provided that if a Designated Event shall have
--------
occurred and be continuing, such reduction shall not be made on such date but
shall, instead, be made on the next Interest Payment Date on which there is no
Designated Event then occurring or continuing. On the Principal Payment Date
occurring on or immediately following the Second Sales Threshold Date, each of
the Applicable Rates shall be reduced by a further 0.25% per annum; provided
--------
that if a Designated Event shall have occurred and be continuing, such further
reduction shall not be made on such date but shall, instead, be made on the next
Principal Payment Date on which there is no Designated Event then occurring or
continuing.
"Approved Fund" means, with respect to any Lender that invests in bank
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loans, any other fund that is advised or managed by the same investment advisor
as such Lender or an Affiliate of such investment advisor.
"Assignment and Acceptance" means an assignment and acceptance entered into
-------------------------
by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent,
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substantially in the form of Exhibit D or any other form approved by the
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Administrative Agent and the Borrower.
"Atlantic Crossing" means Atlantic Crossing Ltd., a Bermuda company and an
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affiliate of the Borrower.
"Availability Period" means:
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(a) with respect to the Tranche A-1 Term Loans, the period from and
including the Closing Date to but excluding the earliest of (i) if the Actual
Date of Commercial Operation does not occur prior to the Guaranteed Completion
Date, the Guaranteed Completion Date, (ii) if the Actual Date of Commercial
Operation does occur prior to the Guaranteed Completion Date, the date on which
the System Contractors have received payment in full of all amounts due under
the Supply Contracts in respect of the Work (as defined in the Supply Contracts)
(other than the portion thereof constituting the Final Contractor Payment) and
(iii) the date of termination of the Commitments; and
(b) with respect to the Tranche A-2 Term Loans, the period from and
including the Closing Date to and including the earliest of (i) the Commercial
Operation Date, (ii) the Guaranteed Completion Date and (iii) the date of
termination of the Commitments; and
5
(c) with respect to any Working Capital Loan, the period from and
including the Closing Date to but excluding the earlier of (i) the Maturity Date
for the Working Capital Loans and (ii) the date of termination of the
Commitments.
"Backhaul Account" is defined in Section 2.15.1 of the Securities Accounts
---------------- --------------
Agreement.
"Backhaul Capacity" means capacity on fiber optic telecommunications
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systems (other than the System) in respect of which the Borrower or a Subsidiary
has acquired usage rights in accordance with the terms of this Agreement.
"Backhaul Revenues" means, for any period, all revenues received by the
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Borrower and its Subsidiaries from sales, leases or other dispositions for cash
of Backhaul Capacity (other than any such revenues (i) constituting
reimbursements or payments for operations and maintenance or similar such costs
and (ii) derived from sales, leases or other dispositions for cash of Backhaul
Capacity that was acquired in exchange for Swapped System Capacity).
"Basic System" means the System which, as of the Closing Date, the System
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Contractors have been instructed to construct, without taking into account any
upgrade thereof.
"Board" means the Board of Governors of the Federal Reserve System of the
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United States of America.
"Borrower" is defined in the preamble.
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"Borrower Accounts" shall be the collective reference to the Revenue
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Account, the Construction Account, the Clean-Up Sub-Account, the Loan Proceeds
Sub-Account, the Delay Proceeds Sub-Account, the Commercial Operation Prepayment
Account, the Upgrade Account, the Upgrade Loan Proceeds Sub-Account, the Upgrade
Delay Proceeds Sub-Account, the O&M Account, the O&M Reserve Account, the Debt
Reserve Account, the Backhaul Account, the Casualty Proceeds Account, the Sales
and Issuances Proceeds Account, and each other account, together with each sub-
account of any such account, established and maintained on behalf of the
Borrower pursuant to the provisions of the Securities Accounts Agreement.
"Borrower Pledge Agreement (English Law)" means the Charge of Shares
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(English Law), dated as of the date hereof, made by the Borrower in favor of the
Administrative Agent.
"Borrower Pledge Agreement (New York Law)" means the Pledge Agreement (New
----------------------------------------
York Law), dated as of the date hereof, made by the Borrower in favor of the
Administrative Agent.
"Borrower Pledge Agreements" means the Borrower Pledge Agreement (English
--------------------------
Law) and the Borrower Pledge Agreement (New York Law).
"Borrower Security Agreement (Bermuda Law)" means the Security Agreement
-----------------------------------------
(Bermuda Law), dated as of the date hereof, made by the Borrower in favor of the
Administrative Agent.
6
"Borrower Security Agreement (New York Law)" means the Security Agreement
------------------------------------------
(New York Law), dated as of the date hereof, made by the Borrower in favor of
the Administrative Agent.
"Borrower Security Agreements" means the Borrower Security Agreement (New
----------------------------
York Law) and the Borrower Security Agreement (Bermuda Law).
"Borrowing" means Loans of the same Class and Type, made, converted or
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continued on the same date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect.
"Business Day" means any day that is not a Saturday, Sunday or other day on
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which commercial banks in New York City are authorized or required by law to
remain closed; provided that, when used in connection with a Eurodollar Loan,
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the term "Business Day" shall also exclude any day on which banks are not open
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for dealings in dollar deposits in the London interbank market.
"Capacity" means System Capacity and Backhaul Capacity.
--------
"Capacity Sales Agreements" means all agreements for the sale, lease or
-------------------------
other disposition of Capacity entered into between the Borrower or any
Subsidiary and any other Person.
"Capacity Sales Revenue" means the cumulative cash revenue received by the
----------------------
Borrower and any Subsidiary and deposited into the Revenue Account minus all
sales and marketing commissions associated therewith.
"Capital Budget" is defined in Section 4.01(f).
-------------- ---------------
"Capital Costs" means all costs and expenses incurred or to be incurred by
-------------
the Borrower or any Subsidiary in connection with the design, development,
installation, construction, completion, start-up and testing of the System (and
shall include, in any event, all interest and other financing costs during
construction incurred or to be incurred by the Borrower or any Subsidiary (if
permitted pursuant to Section 6.01)), all payments under Hedging Agreements, all
------------
costs in the nature of OA&M Expenses, all Marketing Commissions expected to be
payable prior to the Commercial Operation Date which are not anticipated to be
paid with revenues to be received, and all costs associated with the acquisition
of Backhaul Capacity, in each case to the extent set forth in the then current
Capital Budget.
"Capital Lease Obligations" of any Person means the obligations of such
-------------------------
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
7
"Capital Stock" means any and all shares, interests, participations, units
-------------
or other equivalents (however designated) of capital stock of a corporation, and
any and all equivalent ownership interests in a Person (other than a
corporation).
"Casualty Proceeds" means all payments received by the Administrative
-----------------
Agent, the Borrower or any Subsidiary from any insurer in respect of casualty to
or loss of property, and all awards and proceeds in respect of a taking, but
excluding business interruption insurance or delayed opening of business
insurance and payments in respect of liability policies.
"Casualty Proceeds Account" is defined in Section 2.19.1 of the Securities
------------------------- --------------
Accounts Agreement.
"Certificate of Commercial Acceptance" is defined in the Alcatel Supply
------------------------------------
Contract.
"Certificate of Final Acceptance" is defined in the Alcatel Supply
-------------------------------
Contract.
"Certificate of Provisional Acceptance" is defined in the Alcatel Supply
-------------------------------------
Contract.
"Change in Control" means and shall be deemed to have occurred if (a) prior
-----------------
to the Commercial Operation Date, Global Crossing shall cease to own,
beneficially or of record (whether directly or indirectly), 100% of the
outstanding economic interests in the Borrower or shall cease to have
affirmative management control of the Borrower, (b) from and after the
Commercial Operation Date to, but excluding the date upon which the Contractor
is irrevocably directed to undertake the First Permitted Upgrade pursuant to and
in accordance with Article 6A of Alcatel Supply Contract, Global Crossing shall
cease to own, beneficially or of record (whether directly or indirectly), at
least 80% of the outstanding economic interests in the Borrower or shall cease
to have affirmative management control of the Borrower or (c) from and after the
date upon which the Contractor is irrevocably directed to undertake the First
Permitted Upgrade pursuant to and in accordance with Article 6A of Alcatel
Supply Contract, Global Crossing shall cease to have affirmative management
control of the Borrower, or any other Person or group of related Persons, as
defined in Section 13(d) of the Securities Exchange Act of 1934, shall own
beneficially or of record (whether directly or indirectly) more of the economic
interests of the Borrower than are at the time owned by Global Crossing.
"Change in Law" means (a) the adoption of any law, rule or regulation after
-------------
the Closing Date, (b) any change in any law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
Closing Date or (c) compliance by any Lender or any parent of any Lender with
any request, guideline or directive of any Governmental Authority made or issued
after the Closing Date (whether or not having the force of law).
"Checking Account" means a checking account of the Borrower into which
----------------
funds may be deposited and withdrawn in accordance with Section 2.26 of the
------------
Securities Accounts Agreement.
"Class," when used in reference to any Loan or Borrowing, refers to whether
-----
such Loan, or the Loans comprising such Borrowing, are Working Capital Loans,
Tranche A-1 Term Loans or Tranche A-2 Term Loans and, when used in reference to
any Commitment, refers to whether
8
such Commitment is a Working Capital Loan Commitment, a Tranche A-1 Term Loan
Commitment or a Tranche A-2 Term Loan Commitment.
"Clean-Up Sub-Account" is defined in Section 2.1.1 of the Securities
-------------------- -------------
Accounts Agreement.
"Closing Date" means the date on which this Agreement shall have been
------------
executed and delivered by the parties hereto and the conditions specified in
Section 4.01 are satisfied or waived.
------------
"Closing Date Certificate" means a certificate of a Responsible Officer of
------------------------
the Borrower, substantially in the form of Exhibit G.
---------
"Co-Arrangers" means CIBC Xxxxxxxxxxx Corp., a non-bank affiliate of CIBC
------------
Inc. and Deutsche Bank Securities Inc., a Delaware corporation, each in its
capacity as an arranger with respect hereto.
"Code" means the Internal Revenue Code of 1986, as amended from time to
----
time.
"Collateral" means any and all "Collateral," as defined in any applicable
----------
Security Document.
"Commercial Operation Date" means the earlier to occur of (a) the issuance
-------------------------
of the Certificate of Commercial Acceptance with respect to the Basic System and
(b) the issuance of the Certificate of Provisional Acceptance with respect to
the Basic System.
"Commercial Operation Prepayment Account" is defined in Section 2.18.1 of
--------------------------------------- --------------
the Securities Account Agreement.
"Commitment" means, individually or collectively as the context may
----------
require, the Working Capital Loan Commitment or the Term Loan Commitment.
"Committed Capacity Sales Revenue" means revenue from sales of System
--------------------------------
Capacity that the Borrower or any Subsidiary is entitled to receive in cash
under the then existing firmly committed contractual arrangements that require
the making of payments thereunder prior to the First Permitted Upgrade Payment
Date, provided that in calculating the amount of revenue that will constitute
--------
Committed Capacity Sales Revenue, no single capacity purchaser will be permitted
to account for more than 50% of such revenue.
"Consent" means, individually or collectively as the context may require,
-------
the Contractor Consents, the Marketing Agent Consent, the Financial Services
Consent, and, from and after the delivery thereof in accordance with the terms
hereof, the Operator Consent, the System Manager Consent, the AC-1 Consent and
any other consent and agreement entered into in respect of any Additional
Material Contract.
"Consolidated Interest Expense" means, with respect to the Borrower and the
-----------------------------
Subsidiaries for any period, the gross interest expense with respect to
indebtedness for borrowed
9
money (other than indebtedness for borrowed money among the Borrower and the
Subsidiaries), including all cash and accrued interest expense, of the Borrower
and the Subsidiaries for such period.
"Construction Account" is defined in Section 2.1.1 of the Securities
-------------------- -------------
Accounts Agreement.
"Construction Progress Certificates" means (a) a certificate from the
----------------------------------
Contractor (and countersigned by the Borrower and the Independent Engineer),
substantially in the form of Exhibit B-3 and (b) a certificate from TSSL (and
-----------
countersigned by the Borrower and the Independent Engineer), substantially in
the form of Exhibit B-4.
-----------
"Consultants" means, collectively, the Independent Engineer, the Market
-----------
Consultant and the Insurance Consultant.
"Contest" means, with respect to any tax, Lien, claim or obligation, a
-------
contest pursued in good faith and by appropriate proceedings diligently
conducted, so long as (a) adequate reserves in accordance with GAAP have been
established with respect thereto, (b) no Lien shall have been filed in
connection therewith or any Lien filed in connection therewith shall have been
removed from the record by the bonding thereof and (c) the failure to pay such
tax, Lien, claim or obligation during the pendency of such contest could not
reasonably be expected to have a Material Adverse Effect.
"Continuation/Conversion Notice" means a request by the Borrower to convert
------------------------------
or continue a Working Capital Borrowing or a Term Loan Borrowing in accordance
with Section 2.06, substantially in the form of Exhibit C.
------------ ---------
"Contractor" means Alcatel Submarine Networks, a societe anonyme organized
----------
under the laws of France and Alcatel Submarine Networks, Inc., a Delaware
corporation, collectively.
"Contractor Consents" means (a) the Alcatel Contractor Consent, (b) the
-------------------
Consent and Agreement to be entered into among the Borrower, Pan American
Crossing, TSSL and the Administrative Agent with respect to the Tyco Supply
Contract and the St. Croix Contract, and, with respect to any supply contract
permitted to replace the Tyco Supply Contract in accordance with Section 7.11,
------------
any replacement consent and agreement reasonably acceptable to the
Administrative Agent and relating to such new supply contract and (c) any other
consents reasonably requested by the Lead Agents in connection with the St.
Croix Contracts.
"Contractor Escrow Agreements" means (a) the Escrow Agreement to be entered
----------------------------
into in the event of a dispute under the Alcatel Supply Contract, among the
Contractor, the Borrower and the Alcatel Escrow Agent and (b) the Escrow
Agreement to be entered into in the event of a dispute under the Tyco Supply
Contract among TSSL, the Borrower and the Tyco Escrow Agent, each as described
in the applicable Supply Contract.
10
"Contractual Obligation" means, as to any Person, any provision of any
----------------------
security issued by such Person or any agreement, instrument, judgment, order,
decree or other undertaking to which such Person is a party or by which it or
any of its property is bound.
"Control" means the possession, directly or indirectly, of (a) the power to
-------
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise or (b)
the ownership of 10% or more of the securities having ordinary voting power for
the election of directors of a Person. "Controlling" and "Controlled" have
----------- ----------
meanings correlative thereto.
"Credit Extension" means (a) the making of a Loan by a Lender or (b) the
----------------
withdrawal or transfer of funds from the Clean-Up Sub-Account, the Delay
Proceeds Sub-Account, the U.S. Delay Proceeds Sub-Account, the Upgrade Delay
Proceeds Sub-Account, the U.S. Upgrade Delay Proceeds Sub-Account or the Upgrade
Loan Proceeds Sub-Account, in accordance with the Securities Accounts Agreement.
"Credit Extension Certificate" means a certificate of the Borrower,
----------------------------
substantially in the form of Exhibit B-2.
-----------
"Credit Extension Date" means (a) in the case of any Credit Extension
---------------------
(other than the making of Working Capital Loans from and after the Commercial
Operation Date), (1) the Closing Date and the last Business Day of each calendar
month and (2) with respect to any Class of Loans, the Termination Date
applicable thereto and (b) in the case of Working Capital Loans from and after
the Commercial Operation Date, a Business Day.
"Credit Extension Request" means a notice from the Borrower, substantially
------------------------
in the form of Exhibit B-1 (with such changes as the Borrower and the
-----------
Administrative Agent shall mutually agree to), together with any attachments
thereto called for by such Exhibit.
"Cutoff Date" means the later to occur of (a) the date which is 30 days
-----------
following the Commercial Operation Date and (b) the date on which all Landing
Licenses required to operate the System have been obtained and shall no longer
be subject to appeal and the Administrative Agent shall have received
appropriate and favorable opinions of counsel in substantially the form of
Exhibit J-9.
-----------
"Debt Reserve Account" is defined in Section 2.14.1 of the Securities
-------------------- --------------
Accounts Agreement.
"Debt Reserve Amount" means, at any time of determination, an amount equal
-------------------
to the sum of (a) an amount equal to the anticipated interest on the Loans
(based on the then current rates applicable to the then outstanding Loans) for
the following 6 months (after giving effect to any prepayment thereof) plus (b)
an amount equal to the total of the next scheduled principal payment on each of
the Term Loans due on the next Principal Payment Date (without giving effect to
any prepayment thereof), provided that in no event shall the Debt Reserve Amount
--------
exceed the principal amount outstanding under the Term Loans plus six months of
anticipated interest thereon.
11
"Default" means any event or condition which constitutes an Event of
-------
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Defaulting Lender" means any Lender with respect to which a Lender Default
-----------------
is in effect.
"Delay Proceeds Sub-Account" is defined in Section 2.1.1 of the Securities
-------------------------- -------------
Accounts Agreement.
"Designated Event" means, (a) as of any Principal Payment Date, the
----------------
Borrower's failure to be in compliance with Section 6.24 as of such Principal
------------
Payment Date, as set forth in the certificate delivered by the Borrower to the
Administrative Agent in accordance with Section 5.02(c), or the failure of the
---------------
Borrower to deliver such a certificate when required under Section 5.02(c), and
---------------
such Designated Event shall be deemed to continue until such time as the
Borrower shall have delivered a certificate under Section 5.02(c) indicating
---------------
compliance with Section 6.24 and the Borrower shall be in compliance with
------------
Section 6.24 and (b) if any Tranche A-2 Term Loans have been made, the
------------
Certificate of Commercial Acceptance or the Certificate of Final Acceptance with
respect to the First Permitted Upgrade shall not have been issued by the date
which is 90 days after the Scheduled Upgrade Date (as defined in the Alcatel
Supply Contract) in respect of the First Permitted Upgrade, provided that such
--------
Designated Event shall be deemed to continue until such time as an amount equal
to twice the aggregate principal amount of all outstanding Tranche A-2 Term
Loans together with all interest thereon has been applied to the prepayment of
the Term Loans in accordance with clause fifth of Section 2.7.3(a) or clause
----------------
ninth of Section 2.7.4(a) of the Securities Accounts Agreement and all Tranche
----------------
A-2 Term Loan Commitments have been terminated.
"Disputed Invoice" means the portion of any invoice submitted by any System
----------------
Contractor under any Supply Contract the payment of which is being disputed by
the Borrower or the Independent Engineer.
"Distribution Account" means an account established by the Borrower into
--------------------
which the Borrower shall be permitted to deposit its portion of Excess Cash Flow
to the extent Excess Cash Flow is distributed to the Borrower in accordance with
Section 2.7.4(a) of the Securities Accounts Agreement. The Distribution Account
----------------
shall not be established pursuant to the Securities Accounts Agreement and the
Secured Parties shall not have a security interest in the Distribution Account.
"Documentation Agent" is defined in the preamble.
------------------- --------
"Dollars" or "$" refers to lawful currency of the United States of America.
------- -
"Environmental Laws" means all applicable laws, rules, permits, orders and
------------------
regulations relating to the protection of the environment and natural resources,
and all similar items under the laws of each jurisdiction (including the United
States and Bermuda), where the Borrower or any Subsidiary is incorporated and/or
operates.
12
"Environmental Liability" means any liability, contingent or otherwise
-----------------------
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law
or (b) the release or threatened release of any Hazardous Materials into the
environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"ERISA Affiliate" means any entity (whether or not incorporated) that,
---------------
together with the Borrower, is treated as a single employer under Section 414(b)
or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section
412 of the Code, is treated as a single employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event," as defined in Section
-----------
4043(c) of ERISA or the regulations issued thereunder with respect to a Plan
(other than an event for which the 30-day notice period is waived under
applicable PBGC regulations); (b) the failure to make a required contribution to
any Plan sufficient to give rise to a lien under Section 302(f) of ERISA; (c)
the existence with respect to any Plan of an "accumulated funding deficiency"
(as defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (d) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (e) the taking of any steps by the Borrower or any of its
ERISA Affiliates to terminate any Plan, if such termination could result in any
liability under Title IV of ERISA with respect to such Plan; (f) the receipt by
the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to an intention to terminate any Plan or Plans or to appoint a
trustee to administer any Plan; (g) the incurrence by the Borrower or any of its
ERISA Affiliates of any liability with respect to the withdrawal or partial
withdrawal, within the meaning of Section 4063 of ERISA, from any Multiemployer
Plan; or (h) the receipt by the Borrower or any ERISA Affiliate of any notice
from any Multiemployer Plan concerning the imposition of Withdrawal Liability or
a determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.
"Escrowed Downpayments" means downpayments paid by a purchaser of Capacity
---------------------
in respect of the future use of Capacity that are placed in escrow pursuant to
escrow arrangements entered into by the Borrower or a Subsidiary on commercially
reasonable terms and to which the Borrower or such Subsidiary is not yet
entitled, provided that any such downpayment shall cease to be an Escrowed
--------
Downpayment at such time as the Borrower or such Subsidiary becomes entitled
thereto and the funds are released to the Borrower or such Subsidiary in
accordance with the terms of such escrow arrangement.
"Eurodollar," when used in reference to any Loan or Borrowing, refers to
-----------
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" is defined in Article VII.
---------------- -----------
13
"Event of Loss" means the loss, destruction or damage of all of any
-------------
material portion of a Segment.
"Excess Cash Flow" means, (i) on and prior to the Cutoff Date, for each
----------------
period beginning the day after the last date on which amounts were transferred
from the Revenue Account in accordance with Section 2.7.3 of the Securities
-------------
Accounts Agreement (or, in the case of the first such period, beginning on the
Closing Date) and ending on the last Business Day of a month (or, with respect
to the last such period, on the Cutoff Date), the sum of (x) all cash revenue
received during such period by the Borrower or any of its Subsidiaries and
available after the application of the amounts set forth in clauses first
through fourth of Section 2.7.3(a), clause first of Section 2.8.3 and clause
---------------- -------------
first of Section 2.9.3 of the Securities Accounts Agreement plus (y) 15% of the
-------------
difference between (1) all Backhaul Revenues of each Subsidiary during such
period minus (2) the Marketing Commissions paid by any Subsidiary in respect of
its Backhaul Revenues during such period and (ii) for each semi-annual period
ending on a Principal Payment Date (or, with respect to the Initial Principal
Payment Date, the period from the Cutoff Date to the Initial Principal Payment
Date), the sum of (x) all cash revenue received during such period by the
Borrower or any of its Subsidiaries and available after the application of the
amounts set forth in clauses first through eighth of Section 2.7.4(a), clause
----------------
first of Section 2.8.3 and clause first of Section 2.9.3 of the Securities
------------- -------------
Accounts Agreement plus (y) 15% of the difference between (1) all Backhaul
Revenues of each Subsidiary during such period minus (2) the Marketing
Commissions paid by any Subsidiary in respect of its Backhaul Revenues during
such period.
"Excess System Capacity Sales" means, at any time of determination, the
----------------------------
excess, if any of (x) Committed Capacity Sales Revenue at such time of
determination over (y) revenue from sales of System Capacity that, in the base
case Projections, is projected to be received on or prior to the First Permitted
Upgrade Payment Date.
"Excluded Taxes" means, with respect to the Administrative Agent, any other
--------------
Agent, any Lender or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) Taxes imposed by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located; provided, however, that if such place of
-------- -------
organization or principal office or lending office is in the United States or a
political subdivision thereof, such Taxes referred to this clause (a) shall not
include any withholding Taxes imposed by the United States or any political
subdivision thereof, (b) any branch profits Taxes imposed by the United States
of America or any similar Tax imposed by any other jurisdiction in which any
Lender is located and (c) in the case of a Lender, any withholding Tax that is
imposed on amounts payable to such Lender to the extent, subject to Section 9.04
------------
with respect to assignees, (i) such withholding Tax is not the result of a
Change in Law or (ii) such withholding Tax is imposed as a result of such
Lender's failure to comply with the provisions of Section 2.16(e).
---------------
"Federal Funds Effective Rate" means, for any day, the weighted average
----------------------------
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if
14
such rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.
"Fee Letter" means the fee letter, dated as of the date hereof, from the
----------
Borrower to the Lead Agents and the Administrative Agent.
"Final Contractor Payment" means that portion of the Contract Price which
------------------------
is payable (subject to the terms of the Alcatel Supply Contract) to the
Contractor with respect to System Final Completion.
"Financial Services Agreement" means the Financial Services Agreement,
----------------------------
dated as of the date hereof, between the Borrower and GCDC.
"Financial Services Arrangement Fee" means an up-front fee of 1% of the
----------------------------------
aggregate principal amount of the Loans.
"Financial Services Consent" means the Consent and Agreement, dated as of
--------------------------
the date hereof, among the Borrower, GCDC and the Administrative Agent and, with
respect to any financial services agreement permitted to replace the Financial
Services Agreement in accordance with Section 7.11, any consent and agreement
------------
reasonably acceptable to the Administrative Agent and relating to such new
agreement.
"First Capital Cost Completion Date" means the date on which the
----------------------------------
Administrative Agent receives certificates from the Borrower and the Independent
Engineer certifying that System Final Completion has occurred and that all
Capital Costs identified in the then current Capital Budget (other than those
Capital Costs associated with the First Permitted Upgrade) have been paid.
"First Loan" is defined in Section 4.02(b).
---------- ---------------
"First Permitted Upgrade" means a Permitted System Upgrade which doubles
-----------------------
the initial planned capacity of the Basic System from 20 Gb/s per fiber pair to
40 Gb/s per fiber pair.
"First Permitted Upgrade Final Completion" means the date on which the
----------------------------------------
Certificate of Final Acceptance shall have been issued with respect to the First
Permitted Upgrade in accordance with the terms of the Alcatel Supply Contract
and all payments due to the Contractor thereunder shall have been made, as
certified by the Independent Engineer.
"First Permitted Upgrade Payment Date" means the date that the First
------------------------------------
Permitted Upgrade is expected to be commenced (which shall be based upon the
expected commencement date articulated by the Borrower (in the Projections or
otherwise) to any Lead Agent).
"First Sales Threshold Date" means the date on which (1) the sum of (a)
--------------------------
Capacity Sales Revenue plus (b) the amount of revenues in the nature of Capacity
Sales Revenues that the
15
Borrower or any Subsidiary is entitled to receive in cash under then existing
firmly committed contractual arrangements and that are required to be deposited
into the Revenue Account pursuant to the terms of the Loan Documents (whether
directly or after being held in the U.S. Revenue Account and then transferred to
the Revenue Account pursuant to the Securities Accounts Agreement) not later
than 6 months prior to the Maturity Date in respect of the Term Loans (provided
--------
that such firm commitments shall be included for purposes of this clause (b)
only to the extent that such firm commitments have not matured into cash
payments received and already then included in any amounts included under clause
(a)), equals or exceeds $250,000,000 and (2) at least $120,000,000 of the
aggregate principal amount of the Term Loans have been repaid or prepaid.
"GAAP" means generally accepted accounting principles in the United States
----
of America.
"GCDC" means Global Crossing Development Co.
----
"Global Crossing" means Global Crossing Ltd., a corporation organized and
---------------
existing under the laws of Bermuda.
"Global Network" means Global Crossing Network Center Ltd., a Bermuda
--------------
corporation and a wholly owned subsidiary of Global Crossing.
"Governmental Action" means all permits, authorizations, registrations,
-------------------
consents, approvals, notices and licenses of or with any Governmental Authority
that are required in connection with the construction, installation, ownership,
possession and operation of the System, including all Landing Licenses and
including the St. Croix Corridor License.
"Governmental Authority" means the government of the United States of
----------------------
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any obligation,
--------- ---------
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
---------------
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
--------
collection or deposit in the ordinary course of business.
16
"Guaranteed Completion Date" means August 19, 2000.
--------------------------
"Hazardous Materials" means all materials defined as hazardous substances
-------------------
under the Federal Comprehensive Environmental Response, Compensation and
Liability Act, petroleum or petroleum distillates, or friable asbestos or
friable asbestos containing materials, and all similar items under the laws of
each jurisdiction (including the United States and Bermuda) where the Borrower
or any Subsidiary is incorporated and/or operates.
"Hedging Agreement" means any interest rate protection agreement, foreign
-----------------
currency exchange agreement, commodity price protection agreement or other
interest or currency exchange rate or commodity price hedging arrangement.
"Indebtedness" of any Person means, without duplication, (a) all
------------
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person in
respect of the deferred purchase price of property or services (excluding
current accounts payable incurred in the ordinary course of business), (d) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (e) all Guarantees by such Person of
Indebtedness of others, (f) all Capital Lease Obligations of such Person, (g)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty, (h) all obligations under
Hedging Agreements and (i) all obligations, contingent or otherwise, of such
Person in respect of bankers' acceptances.
"Indemnified Taxes" means all Taxes other than Excluded Taxes.
-----------------
"Independent Engineer" means Conexart Technologies, Inc. or such other
--------------------
engineer or engineering firm as may be appointed by the Administrative Agent
with the approval of the Borrower in accordance with Section 9.13.
------------
"Initial Principal Payment Date" means the earlier of (a) the last Business
------------------------------
Day of the month of August, November, February or May which is the first to
occur at least 165 days after the Cutoff Date occurs and (b) the day which is
six months after the Guaranteed Completion Date.
"Initial Syndication Date" means the date on which the Lead Agents close
------------------------
the initial post-Closing Date syndication of the Loans pursuant to Assignment
and Acceptances.
"Insurance Consultant" means Aon Risk Services.
--------------------
"Intercompany Agreement" means the Intercompany Agreement, dated as of the
----------------------
date hereof, in form and substance reasonably satisfactory to the Lead Agents,
between the Borrower and the U.S. Subsidiary.
17
"Interest Coverage Ratio" means, for any period, the ratio of (a) System
-----------------------
Revenues received during such period minus (i) OA&M Expenses paid during such
period and (ii) Marketing Commissions paid during such period to (b)
Consolidated Interest Expense for such period.
"Interest Payment Date" means (a) with respect to any ABR Loan, the last
---------------------
Business Day of each August, November, February and May and (b) with respect to
any Eurodollar Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurodollar
Borrowing with an Interest Period of more than 3 months' duration, the days
prior to the last day of such Interest Period that occur at intervals of 3
months' duration after the first day of such Interest Period.
"Interest Period" means, with respect to any Eurodollar Borrowing, the
---------------
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is 1, 2, 3, 6 or, if available to
all Lenders, 12 months thereafter, as the Borrower may elect; provided that (a)
--------
if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day,
(b) any Interest Period that commences on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
last calendar month of such Interest Period) shall end on the last Business Day
of the last calendar month of such Interest Period and (c) unless the
Administrative Agent agrees to the contrary, during the first 6 months after the
Closing Date, the Borrower shall elect Interest Periods of 1 month's duration
(provided that the Borrower may, during such 6 month period, select Interest
Periods of less than 1 month's duration as long as no Lender has informed the
Administrative Agent that it will not make Eurodollar Loans with an Interest
Period of less than 1 month's duration). For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
"Landing License" means, with respect to any Landing Location, the
---------------
telecommunications license (if such a license is required) issued by a
Governmental Authority of such Landing Location permitting the System to land at
such Landing Location.
"Landing Locations" means, New York, St. Croix and Florida, and each other
-----------------
location in which the System is landed or planned to land in accordance with the
terms hereof.
"Lead Agents" is defined in the preamble.
-----------
"Lender Default" means (a) the refusal (which has not been retracted) of a
--------------
Lender to make available its portion of any Borrowing or (b) a Lender having
notified the Administrative Agent and/or the Borrower that it does not intend to
comply with its obligations under Section 2.01, in the case of either clause (a)
------------
or clause (b) above, as a result of the appointment of a receiver or conservator
with respect to such Lender at the direction or request of any regulatory agency
or authority.
18
"Lenders" means, the Persons designated on Schedule 2.01 as having made a
------- -------------
Commitment and any other Person that shall have become a party hereto with
respect to the Commitments pursuant to an Assignment and Acceptance, other than
any such Person that ceases to be a party hereto pursuant to an Assignment and
Acceptance.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
---------
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
---------
Eurodollar Borrowing for such Interest Period shall be the average rate (rounded
upwards, if necessary, to the next 1/16 of 1%) at which dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered by
the principal New York office of each Reference Lender in immediately available
funds in the London interbank market at approximately 11:00 a.m., London time,
two Business Days prior to the commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of trust,
----
lien, pledge, hypothecation, encumbrance, charge, security interest or similar
encumbrance in, on or of such asset and (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention agreement
(or any financing lease having substantially the same economic effect as any of
the foregoing) relating to such asset.
"Loan Documents" shall be the collective reference to this Agreement, the
--------------
Notes, the Fee Letter, the Security Documents and the Subsidiary Guaranty
Agreements.
"Loan Parties" shall be the collective reference to each Shareholder, the
------------
Borrower, each Subsidiary, the St. Croix Affiliate and Global Network.
"Loan Proceeds Sub-Account" is defined in Section 2.1.1 of the Securities
------------------------- -------------
Accounts Agreement.
"Loans" shall be the collective reference to the Working Capital Loans and
-----
the Term Loans.
"Majority Lenders" means, at any time of determination, Non-Defaulting
----------------
Lenders having outstanding Working Capital Loans, outstanding Term Loans and
unused Commitments representing more than 51% of the sum of the total
outstanding Working Capital Loans, outstanding Term Loans and unused Commitments
of all Non-Defaulting Lenders at such time.
"Market Consultant" means X. Xxxx & Associates.
-----------------
19
"Marketing Agent" means Global Crossing International Limited, together
---------------
with its subsidiaries and their permitted successors and assigns.
"Marketing Agent Consent" means the Consent and Agreement, dated as of the
-----------------------
date hereof, among the Borrower, the Marketing Agent and the Administrative
Agent and, with respect to any marketing agreement permitted to replace the
Marketing Agreement in accordance with Section 7.11, any consent and agreement
------------
reasonably acceptable to the Administrative Agent and relating to such new
marketing agreement.
"Marketing Agreement" means the Marketing Agreement, dated as of November
-------------------
25, 1998, between the Borrower and the Marketing Agent.
"Marketing Commissions" means commissions payable to the Marketing Agent
---------------------
under the Marketing Agreement, but not including expense reimbursement and other
obligations payable thereunder.
"Master Pledge Trustee" means the pledgee selected by the Borrower and
---------------------
subject to the reasonable consent of the Lead Agents, under the St. Croix Master
Pledge Agreement, together with each of its successors and assigns.
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
business, assets, revenues (at any time of determination after the Commercial
Operation Date), results of operations (at any time of determination after the
Commercial Operation Date) or financial condition of the Borrower and the
Subsidiaries taken as a whole, (b) the ability to achieve the Commercial
Operation Date by the Guaranteed Completion Date, (c) the ability of the
Borrower to perform its obligations under the Loan Documents to which it is a
party or (d) the validity or enforceability of the Loan Documents or the
Consents, the Liens granted under the Loan Documents or the Lenders' rights and
remedies under the Loan Documents or the Consents.
"Material Impact" means (a) a material adverse effect on the Lenders, (b) a
---------------
Material Adverse Effect, (c) a material adverse effect on the revenues of the
Borrower and the Subsidiaries taken as a whole or (d) a material delay in
obtaining, or a material risk in not obtaining, or in the termination or
revocation of, a material Governmental Action necessary to complete or operate
the System as contemplated on the date hereof.
"Maturity Date" means (a) with respect to Term Loans, March 10, 2005 and
-------------
(b) with respect to Working Capital Loans, the earlier of (i) March 10, 2005 and
(ii) the date which is the first anniversary of the date on which the Term Loans
are repaid in full.
"Mid-Atlantic Holdings" means Mid-Atlantic Crossing Holdings Ltd., a
---------------------
corporation organized and existing under the laws of Bermuda.
"Mid-Atlantic Holdings Cash Collateral Agreement" means the cash collateral
-----------------------------------------------
agreement among Mid-Atlantic Holdings, Deutsche Bank Securities Inc., as
securities intermediary and the Administrative Agent.
20
"Mid-Atlantic Holdings Pledge Agreement (Bermuda Law)" means the Charge
----------------------------------------------------
Over Shares, dated as of the date hereof, made by Mid-Atlantic Holdings in favor
of the Administrative Agent.
"Mid-Atlantic Holdings Pledge Agreement (New York Law)" means the Pledge
-----------------------------------------------------
Agreement, dated as of the date hereof, made by Mid-Atlantic Holdings in favor
of the Administrative Agent.
"Milestones" means, with respect to any Landing License, the events set
----------
forth on Schedule 4.02(f).
----------------
"Moody's" means Xxxxx'x Investors Service, Inc.
-------
"Multiemployer Plan" means a multiemployer plan as defined in Section 3(37)
------------------
or Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" means (a) with respect to the sale, transfer, lease or
-----------------
other disposition of any asset (other than Capacity) by the Borrower or any
Subsidiary, an amount certified in reasonable detail by a Responsible Officer of
the Borrower or such Subsidiary to the Lenders as the excess, if any, of (i) the
sum of cash received in connection with such sale, transfer, lease or other
disposition over (ii) the sum of (A) amounts placed in escrow or held as a
reserve, in accordance with GAAP, against any liabilities associated with such
sale or disposition (except that, to the extent and as of the time any such
amounts are released from such reserve, such amounts shall constitute Net Cash
Proceeds), (B) amounts paid to minority interest holders of such asset and the
principal amount of any Indebtedness (other than Indebtedness under this
Agreement) which is secured by any such asset and which is repaid in connection
with the sale, transfer, lease or other disposition thereof, (C) the reasonable
out-of-pocket expenses incurred or to be incurred by the Borrower or such
Subsidiary in connection with such sale, transfer, lease or other disposition
and (D) provision for taxes attributable to such sale, transfer, lease or other
disposition (as estimated by the Borrower in good faith, provided that to the
--------
extent such estimate shall have exceeded the amount of taxes actually paid, such
difference shall thereupon constitute Net Cash Proceeds), (b) with respect to
the issuance of any Capital Stock by the Borrower or any Subsidiary, an amount
certified in reasonable detail by a Responsible Officer of the Borrower or such
Subsidiary to the Lenders as the excess of (i) the sum of the cash received in
connection with such issuance over (ii) the underwriting discounts and
commissions (if any) and other reasonable fees, out-of-pocket expenses and other
costs incurred or to be incurred by the Borrower or such Subsidiary in
connection with such issuance, (c) with respect to the incurrence of
Indebtedness by the Borrower or any Subsidiary, an amount certified in
reasonable detail by a Responsible Officer of the Borrower or such Subsidiary to
the Lenders as the excess of (i) the sum of the cash received in connection with
such incurrence of Indebtedness over (ii) the reasonable fees, out-of-pocket
expenses and other costs incurred or to be incurred by the Borrower or such
Subsidiary in connection with such incurrence of Indebtedness and (d) any amount
received by the Borrower or any Subsidiary in respect of Permitted Receivables
Transactions in excess of $25,000,000 since the date of this Agreement, whether
in one or more transactions and whether or not such transactions are related.
21
"Non-Defaulting Lender" means and includes each Lender other than a
---------------------
Defaulting Lender.
"Non-Material System Contracts" shall be the collective reference to the
-----------------------------
Financial Services Agreement, the Intercompany Agreement and, after the
execution thereof, each Additional Non-Material Contract and the Contractor
Escrow Agreements.
"Notes" shall be the collective reference to the Term Notes and the Working
-----
Capital Notes.
"One Capacity" means that capacity on the System which is available on
------------
Segment 1.
"OA&M Agreement" means the collective reference to the O&M Agreement and
--------------
the System Management Agreement.
"OA&M Expenses" means all operation, administration and maintenance
-------------
expenses with respect to the System, Backhaul Capacity and other System
Activities which are payable by the Borrower or any Subsidiary (including all
selling, general and administrative expenses, all sales, excise and similar
taxes, all other taxes and duties payable by the Borrower or such Subsidiary,
all payments owing to the Operator under the O&M Agreement in respect of work
performed thereunder, all payments owing to the System Manager under the System
Management Agreement in respect of work performed thereunder, all expenses to be
reimbursed to the Marketing Agent under the Marketing Agreement and all fees
payable to the Administrative Agent); provided, however, that OA&M Expenses
-------- -------
shall not include (i) Capital Costs, (ii) amounts payable in respect of
Permitted System Upgrades and Permitted Costs, (iii) any non-cash expenses, (iv)
income and franchise taxes payable by any Subsidiary, (v) any amounts payable by
the Borrower or a Subsidiary in respect of the acquisition of Backhaul Capacity,
(vi) any commissions payable in respect of the marketing of Capacity and (vii)
any payments made to any Subsidiary under the Intercompany Agreement.
"Obligations" means all obligations of the Borrower and each other Loan
-----------
Party now or hereafter existing under this Agreement, the Notes, each other Loan
Document to which the Borrower or such other Loan Party is or may become a party
and each Rate Protection Agreement, whether for principal, interest, fees,
indemnities, expenses or otherwise (including all such amounts which would
become due but for the operation of the automatic stay under Section 362(a) of
the United States Bankruptcy Code, 11 U.S.C. (S)362(a), and the operation of
Sections 502(b) and 506(b) of the United States Bankruptcy Code, 11 U.S.C.
(S)502(b) and 506(b)).
"Obligors" shall be the collective reference to the Borrower, any
--------
Shareholder, any Subsidiary, the System Contractors (until the expiration of the
basic warranty periods under the Supply Contracts) and, prior to the performance
of all obligations under the Supply Contract Guarantees, the Supply Contract
Guarantors.
"O&M Account" is defined in Section 2.10.1 of the Securities Accounts
----------- ------- ------
Agreement.
22
"O&M Agreement" means the agreement for the operations and maintenance of
-------------
the System to be entered into between the Borrower and the Operator in
accordance with the terms hereof.
"O&M Reserve Account" is defined Section 2.13.1 of the Securities Accounts
------------------- --------------
Agreement.
"Operating Budget" is defined in Section 5.14.
---------------- ------------
"Operating Plan" is defined in Section 5.14.
-------------- ------------
"Operating Year" means, initially, the period from the Commercial Operation
--------------
Date to the following December 31st and, thereafter, each ensuing calendar year.
"Operator" means a Person (other than the Borrower) reasonably satisfactory
--------
to the Lead Agents that is or becomes party to the O&M Agreement.
"Operator Consent" means the Consent and Agreement in form and substance
----------------
reasonably satisfactory to the Administrative Agent to be entered into among the
Borrower, the Operator and the Administrative Agent and, with respect to any
operations and maintenance agreement permitted to replace the O&M Agreement in
accordance with Section 7.11, any consent and agreement reasonably acceptable to
------------
the Administrative Agent and relating to such new operating and maintenance
agreement.
"Other Taxes" means any and all present or future stamp or documentary
-----------
Taxes, charges or similar levies arising from any payment hereunder or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement.
"Pan American Crossing" means Pan American Crossing Ltd., a Bermuda company
---------------------
and an affiliate of the Borrower and the entity developing the subsea fiber
optic cable system commonly known as Pan American Crossing (which currently is
contemplated to have a landing station in St. Croix).
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
----
defined in ERISA and any successor entity performing similar functions.
"Perfectible Collateral" is defined in Section 3.17.
---------------------- ------------
"Permitted Backhaul Account Use" means, with respect to any Person, (i) the
------------------------------
purchase of Backhaul Capacity by such Person, (ii) the transfer by such Person
of funds to the Backhaul Account, the U.K. Backhaul Account or the U.S. Backhaul
Account, (iii) the payment by such Person of Marketing Commissions payable in
respect of sales of Backhaul Capacity purchased or otherwise acquired by such
Person, (iv) the payment of OA&M Expenses if there are insufficient funds
available for such purpose in the O&M Reserve Account and pursuant to Section
-------
2.7.3(a) or 2.7.4(a), as applicable, of the Securities Accounts Agreement and
-------- --------
(v) the transfer, on a Principal Payment Date, of all or any portion of such
funds to the Revenue Account (such
23
transferred amounts being referred to, as of any such Principal Payment Date, as
the "Redeposited Amount") for application in accordance with Section 2.7.3(a) or
------------------ ----------------
2.7.4(a), as applicable, of the Securities Accounts Agreement.
--------
"Permitted Costs" means (a) all amounts due under the Supply Contracts
---------------
(including in respect of Permitted System Upgrades), (b) any and all amounts due
in connection with any change to the configuration of the System permitted under
Section 6.09, (c) any and all amounts due in respect of any capital expenditure
------------
permitted under Section 6.17 and (d) any other amount applied to costs of the
------------
type set forth in clauses first through eighth of Section 2.7.4(a) of the
----------------
Securities Accounts Agreement.
"Permitted Encumbrances" means:
----------------------
(a) Liens imposed by law for taxes that are not yet due or are being
contested in accordance with Section 5.03;
------------
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
and other like Liens relating to the construction of the System securing
obligations that are not yet overdue by more than 60 days or are being contested
in accordance with Section 5.03;
------------
(c) other Liens arising in the ordinary course of business that are
not incurred in connection with the obtaining of any loan, advance or credit and
that do not in the aggregate materially impair the use of the property or assets
of the Borrower or the value of such property or assets for the purposes of such
business;
(d) Liens, deposits or pledges to secure statutory obligations arising
in connection with workers' compensation, unemployment insurance and other
social security laws or regulations;
(e) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business and in an aggregate amount not to exceed $2,500,000;
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not materially detract from the value of the affected
property or interfere with the ordinary conduct of business of the Borrower or
any Subsidiary;
(g) Liens arising under any Loan Document;
(h) Liens arising under the Contractor Escrow Agreements;
(i) the rights of any purchaser or lessee of Capacity with respect to
the use of such Capacity as set forth or referred to in the Capacity Sales
Agreements;
24
(j) the rights of any lessee of property of the Borrower or any
Subsidiary with respect to the use of such property as set forth in a lease
permitted to be entered into pursuant to Section 6.11(d); and
---------------
(k) Liens arising out of judgments or awards with respect to which
appeals or other proceedings for review are being prosecuted in good faith and
by appropriate proceedings diligently conducted and for the payment of which
adequate reserves have been provided or other provisions reasonably satisfactory
to the Administrative Agent have been made.
"Permitted Investments" means:
---------------------
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within 1 year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 1 year from the
date of acquisition thereof and having, at such date of acquisition, a credit
rating of at least A-l from S&P or at least P-l from Moody's;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within 1 year from the date of acquisition thereof issued
or guaranteed by or placed with, and overnight sweep accounts, money market
deposit accounts issued or offered by, (i) the Administrative Agent or any of
its Affiliates, (ii) any Lender or (iii) any other bank which has a combined
capital and surplus and undivided profits of not less than $250,000,000;
(d) fully collateralized repurchase agreements with a term of not more
than 30 days for securities described in clause (a) above and entered into with
a financial institution satisfying the criteria described in clause (c) above;
and
(e) with respect to the investment of funds on deposit in the Alcatel
Escrow Dispute Account or the Tyco Escrow Dispute Account, investments permitted
by the applicable Contractor Escrow Agreements.
"Permitted Receivables Transaction" means any transfer to another Person of
---------------------------------
the right to receive payments owing to the Borrower or any Subsidiary under
Capacity Sales Agreements (other than pursuant to the Security Documents);
provided that (a) the transferee of such transfer has no recourse to the
--------
Borrower or any Subsidiary on account of the rights so transferred (whether or
not such transferee realizes payment on such receivables) or otherwise, (b) the
transfer is made on commercially reasonably terms for fair value and (c) the
Borrower or such Subsidiary, as applicable, is paid in full in cash at the time
of such transfer.
"Permitted Reserve L/C Facility" means a letter of credit facility for the
------------------------------
Borrower consistent with the terms set forth on Schedule 1.01.
-------------
"Permitted Sources" means:
-----------------
25
(a) the proceeds from the issuance of Capital Stock (in the nature of
common equity), or the proceeds of equity contributions, that have been fully
paid in cash to the Borrower or have been committed to be paid in cash to the
Borrower on terms reasonably satisfactory to the Administrative Agent;
(b) the proceeds from the issuance of Permitted Subordinated Debt or
Capital Stock (in the nature of preferred equity) that have been fully paid in
cash to the Borrower or have been committed to be paid in cash to the Borrower
on terms reasonably satisfactory to Administrative Agent;
(c) cash (other than System Revenues) made available to the Borrower
(to the extent actually funded or otherwise committed to on a basis reasonably
satisfactory to Administrative Agent) by Persons other than the Borrower or a
Subsidiary without any recourse to the Borrower or any Subsidiary;
(d) the Borrower's portion of Excess Cash Flow to the extent otherwise
then distributable to the Borrower pursuant to Section 2.7.4(a) of the
----------------
Securities Accounts Agreement or previously distributed to the Borrower in
accordance with such Section and transferred by the Borrower to an account in
respect of which the Secured Parties do not have a security interest; and
(e) other funds made available exclusively for the benefit of the
Borrower under Section 2.22.3(a)(A)(1) of the Securities Accounts Agreement.
-----------------------
"Permitted Subordinated Debt" means Indebtedness of the Borrower (1) which
---------------------------
has (a) no principal payments, redemptions, repurchases, sinking funds or
prepayments prior to the date which is 1 year after the payment in full in cash
of all Obligations, (b) no cash interest payments except to the extent permitted
by Section 6.06(d) hereof and (c) interest rates, interest payment dates,
---------------
subordination provisions, covenants, defaults and other terms and conditions
reasonably satisfactory to the Lead Agents and (2) in respect of which the
lenders thereof have agreed to pledge to the Secured Parties all of such
lenders' rights therein to secure payment of the Obligations.
"Permitted System Upgrades" means upgrades to the System contemplated by
-------------------------
Article 6A of the Alcatel Supply Contract.
"Person" means any natural person, corporation, limited liability company,
------
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
"Plan" means any employee pension benefit plan (other than a Multiemployer
----
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 302 of ERISA, and in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.
26
"Pledge Agreements" shall be the collective reference to the Shareholder
-----------------
Pledge Agreements, the Borrower Pledge Agreements, the U.K. Subsidiary Pledge
Agreement (New York Law), the St. Croix Master Pledge Agreement, together with
any pledge agreements in favor of the Administrative Agent from any transferee
of the Capital Stock of the Borrower, any Subsidiary or the St. Croix Affiliate.
"Presale Revenue Application Certificate" is defined in Section 2.7.3(a) of
--------------------------------------- ----------------
the Securities Accounts Agreement.
"Prime Rate" means the rate of interest per annum established by Deutsche
----------
Bank AG as its prime or reference or base rate in effect at its principal office
in New York City; each change in the Prime Rate shall be effective from and
including the date such change is effective. The Prime Rate is not necessarily
the lowest rate of interest charged to borrowers.
"Principal Payment Date" means the Initial Principal Payment Date and the
----------------------
last Business Day of each month in which a six-month anniversary thereof occurs
and, with respect to each Class of Loans, the Maturity Date for such Class of
Loans.
"Projections" means the reasonably detailed operating projections for the
-----------
System, covering the period from the date of anticipated operation of the System
through the anticipated scheduled date of final maturity with respect to the
Loans and which reflect the reasonable expected case (and not worst case)
projections of the revenues, operating expenses, cash flow, debt service and
other related items for the System, a copy of which is attached hereto as
Exhibit M.
---------
"Rate Protection Agreement" means a Hedging Agreement related to interest
-------------------------
rate protection entered into by the Borrower with a Lender or an Affiliate
thereof.
"Ready for Commercial Acceptance" is defined in the Alcatel Supply
-------------------------------
Contract.
"Ready for Provisional Acceptance" is defined in the Alcatel Supply
--------------------------------
Contract.
"Redeposited Amount" is defined in the definition of "Permitted Backhaul
------------------
Account Use."
"Reference Lenders" means CIBC Inc., Deutsche Bank AG, New York Branch, and
-----------------
Westdeutsche Landesbank Girozentrale.
"Register" is defined in Section 9.04(c).
-------- ---------------
"Related Parties" means, with respect to any specified Person, such
---------------
Person's Affiliates and the respective directors, officers and employees of such
Person and such Person's Affiliates.
"Required Equity Contribution" means the $110,000,000 contribution of cash
----------------------------
equity by or on behalf of Mid-Atlantic Holdings to the Borrower to fund the
development, construction, installation and ownership of the System.
27
"Required Lenders" means, at any time of determination, Non-Defaulting
----------------
Lenders having outstanding Working Capital Loans, outstanding Term Loans and
unused Commitments representing more than 66-2/3% of the sum of the total
outstanding Working Capital Loans, outstanding Term Loans and unused Commitments
of all Non-Defaulting Lenders at such time.
"Requirement of Law" means, as to any Person, the certificate of
------------------
incorporation and bylaws or other organizational or governing documents of such
Person, and any law, treaty, rule, judgment, decree, order or regulation of any
Governmental Authority, and any determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
"Responsible Officer" means, with respect to any matter and with respect to
-------------------
any Person, the President, any Vice President, Assistant Vice President,
Treasurer or Assistant Treasurer of such Person, or any other officer of such
Person who in the normal performance of his operational responsibility would
have knowledge of such matter and the requirements, if any, with respect
thereto.
"Restricted Contingency" means, at any time, the then unallocated portion
----------------------
of the line item in the Capital Budget titled "Restricted Contingency Reserve."
"Restricted Payment" means any dividend or other distribution (whether in
------------------
cash, securities or other property) with respect to any shares of any class of
Capital Stock of the Borrower or any Subsidiary, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such shares of Capital Stock of the Borrower
or any Subsidiary (or in respect of any Permitted Subordinated Debt) or any
option, warrant or other right to acquire any such shares of Capital Stock of
the Borrower or any Subsidiary.
"Revenue Account" is defined in Section 2.7.1 of the Securities Accounts
--------------- -------------
Agreement.
"Revenue Application Certificate" is defined in Section 2.7.4(a) of the
------------------------------- ----------------
Securities Accounts Agreement.
"St. Croix Affiliate" means GC St. Croix Co., a St. Croix corporation and
-------------------
an indirect subsidiary of Global Crossing.
"St. Croix Contracts" means, collectively, the St. Croix License,
-------------------
Development and Co-Location Agreement and the St. Croix Master Pledge Agreement.
"St. Croix Corridor License" means the Major Water Permit and Major Land
--------------------------
Permit to be issued by the Department of Natural Resources in St. Croix and
identified as permit numbers X6.05P and X6.13P on Schedule 3.08 hereto, together
-------------
with all United States Virgin Islands administrative or legislative actions or
approvals required in connection therewith.
28
"St. Croix License, Development and Co-Location Agreements" means the
---------------------------------------------------------
contract or contracts among TSSL, the Borrower, the St. Croix Affiliate and Pan
American Crossing under which, among other things, (A) the St. Croix Affiliate
will agree to make the benefits of the St. Croix Corridor License available to
(i) the Borrower (and its Subsidiaries) and its successors and assigns for
purposes of enabling the construction, ownership and operation of the System as
contemplated hereby in St. Croix, (ii) at the option of the St. Croix Affiliate,
Pan American Crossing (or its designees) and its successors and assigns for
purposes or enabling the construction, ownership and operation of Pan American
Crossing's subsea fiber optic cable system in St. Croix and (iii) at the option
of the St. Croix Affiliate, other affiliates of Global Crossing which are
developing subsea fiber optic cable systems in St. Croix, and (B) certain rights
and obligations will be set forth in respect of the construction of the St.
Croix landing station (which is expected to be constructed pursuant to a
contract between TSSL and Pan American Crossing), together with all other
contracts necessary or appropriate to provide the Borrower (or its Subsidiaries)
with the right to use and occupy the St. Croix landing station in order to
operate the System as contemplated hereby.
"St. Croix Master Pledge Agreement" means the agreement or agreements under
---------------------------------
which, among other things, Global Network will pledge 100% of the Capital Stock
of the St. Croix Affiliate to the Master Pledge Trustee for the benefit of (a)
the Administrative Agent for the benefit of the Secured Parties, (b) at the
option of Global Network, the lenders in connection with the subsea fiber optic
cable system to be constructed by Pan American Crossing and (c) at the option of
Global Network, other lenders in connection with the subsea fiber optic cable
systems that may be constructed or sponsored by Global Crossing and which land
in St. Croix.
"Sales and Issuances Proceeds Account" is defined in Section 2.22.1 of the
------------------------------------ --------------
Securities Accounts Agreement.
"Scheduled RFS Date" is defined in the Alcatel Supply Contract as in effect
------------------
on the date hereof.
"Second Capital Cost Completion Date" means the date on which the
-----------------------------------
Administrative Agent receives certificates from the Borrower and the Independent
Engineer certifying that First Permitted Upgrade Final Completion has occurred
and that all Capital Costs associated therewith have been paid.
"Second Sales Threshold Date" means at the date on which the sum of (a)
---------------------------
Capacity Sales Revenues plus (b) the amount of revenues in the nature of
Capacity Sales Revenues that the Borrower or any Subsidiary is entitled to
receive in cash under then existing firmly committed contractual arrangements
and that are required to be deposited into the Revenue Account pursuant to the
terms of the Loan Documents (whether directly or after being held in the U.S.
Revenue Account and then transferred to the Revenue Account pursuant to the
Securities Accounts Agreement) not later than 6 months prior to the Maturity
Date in respect of the Term Loans (provided that such firm commitments shall be
included for purposes of this clause (b) only to the extent such firm
commitments have not matured into cash payments received and already then
included in any amounts under clause (a)), equals or exceeds $325,000,000 and
29
(2) at least $160,000,000 of the aggregate principal amount of the Term Loans
have been repaid or prepaid.
"Secured Parties" means the Agents, the Lead Agents, the Securities
---------------
Intermediary, the Lenders and any Affiliate of a Lender party to a Hedging
Agreement.
"Securities Accounts Agreement" means the Securities Accounts, Disbursement
-----------------------------
and Control Agreement, dated as of the date hereof, among the Borrower, the U.K.
Subsidiary, the U.S. Subsidiary, the Administrative Agent and the Securities
Intermediary.
"Securities Intermediary" means Deutsche Bank AG, New York Branch, or its
-----------------------
successor, appointed pursuant to the Securities Accounts Agreement.
"Security Agreements" shall be the collective reference to the Securities
-------------------
Accounts Agreement, the Mid-Atlantic Holdings Cash Collateral Agreement, the
Borrower Security Agreements and each Subsidiary Security Agreement.
"Security Documents" shall be the collective reference to the Pledge
------------------
Agreements, the Security Agreements and any additional security agreement,
pledge agreement or other document which purports to create a security interest
of any kind which is entered into in accordance with the terms hereof (such as,
as a condition to receiving the consent or approval of any party hereto to any
action contemplated hereby).
"Segment" is defined in the Alcatel Supply Contract.
-------
"Segment 1" is defined in the Alcatel Supply Contract.
---------
"Segment 2" is defined in the Alcatel Supply Contract.
---------
"Segment 3" is defined in the Alcatel Supply Contract.
---------
"Shareholder Pledge Agreements" means the Mid-Atlantic Holdings Pledge
-----------------------------
Agreement (Bermuda Law) and the Mid-Atlantic Holdings Pledge Agreement (New York
Law).
"Special Payments" means (a) all payments made by any System Contractor
----------------
under any Supply Contract and all other payments made by any System Contractor
or any Supply Contract Guarantor in respect of any breach or failure by the
applicable System Contractor to perform its obligations under the applicable
Supply Contract, whether as a result of any proceeding, settlement or otherwise,
and (b) all payments under insurance policies maintained by the Borrower or any
Subsidiary to compensate for a delay in the commencement of operations of the
System.
"Special Supply Contract Expenses" is defined in Section 2.7.4(a) of the
-------------------------------- ----------------
Securities Accounts Agreement.
"S&P" means Standard & Poor's Ratings Services.
---
30
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
----------------------
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred
to as "Eurocurrency Liabilities" in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve
Rate shall be adjusted automatically on and as of the effective date of any
change in any reserve percentage.
"subsidiary" means, with respect to any Person (the "parent") at any date,
---------- ------
any corporation, limited liability company, partnership, association or other
entity the accounts of which would be consolidated with those of the parent in
the parent's consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
that is, as of such date, otherwise Controlled by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
"Subsidiary" means any subsidiary of the Borrower.
----------
"Subsidiary Casualty Proceeds" is defined in Section 2.19.2 of the
---------------------------- --------------
Securities Accounts Agreement.
"Subsidiary Guaranty Agreements" shall be the collective reference to the
------------------------------
U.S. Subsidiary Guaranty Agreement, the U.K. Subsidiary Guaranty Agreement and
each other guaranty agreement made by a Subsidiary in favor of the
Administrative Agent.
"Subsidiary Security Agreements" means the collective reference to the U.S.
------------------------------
Subsidiary Security Agreement, the U.K. Subsidiary Security Agreements and each
other security agreement made by a Subsidiary in favor of the Administrative
Agent.
"Supply Contracts" means the Alcatel Supply Contract, the Tyco Supply
----------------
Contract and the St. Croix License, Development and Co-Location Agreements.
"Supply Contract Guarantees" means the Alcatel Guarantee and the Tyco
--------------------------
Guarantee.
"Supply Contract Guarantors" means Alcatel and the Tyco.
--------------------------
"Swap" is defined in Section 6.23.
---- ------------
"Swapped System Capacity" is defined in Section 6.23.
----------------------- ------------
"Syndication Agent" is defined in the preamble.
----------------- --------
"System" is defined in the second recital.
------ ------ -------
31
"System Activities" means (a) all activities related to the design,
-----------------
development, engineering, acquisition, installation, construction, landing,
completion, disposition, financing, modification, start-up, testing, operation,
ownership, possession, maintenance and use of the System, (b) the acquisition
and disposition, in accordance with the terms hereof, of Capacity and (c) the
arrangement for the disposition of terrestrial capacity on other systems.
"System Capacity" means One Capacity, Two Capacity and/or Three Capacity,
---------------
as the context may require.
"System Capacity Cash Amount" is defined in Section 6.23.
--------------------------- ------------
"System Contracts" shall be the collective reference to the Alcatel Supply
----------------
Contract, the Alcatel Guarantee, the Capacity Sales Agreements, the Marketing
Agreement, the Non-Material System Contracts, the Financial Services Agreement,
the Consents, and, after the execution thereof, the Tyco Supply Contract, the
Tyco Guarantee, the St. Croix License, Development and Co-Location Agreements,
the AC-1 Co-Location Agreement and each Additional Material Contract.
"System Contractors" means the Contractor, TSSL and any other person
------------------
contracting with the Borrower or a Subsidiary under the St. Croix License,
Development and Co-Location Agreements.
"System Final Completion" means the date on which the Certificate of Final
-----------------------
Acceptance shall have been issued with respect to the Basic System in accordance
with the terms of the Alcatel Supply Contract, as certified by the Independent
Engineer.
"System Management Agreement" means the agreement for the management of the
---------------------------
System to be entered into between the Borrower and the System Manager.
"System Manager" means a Person (other than the Borrower) reasonably
--------------
satisfactory to the Lead Agents that is or becomes party to the System
Management Agreement.
"System Manager Consent" means the Consent and Agreement in form and
----------------------
substance reasonably satisfactory to the Administrative Agent to be entered into
among the Borrower, the System Manager and the Administrative Agent and, with
respect to any system management agreement permitted to replace the System
Management Agreement in accordance with Section 7.11, any consent and agreement
------------
reasonably acceptable to the Administrative Agent and relating to such system
management agreement.
"System Revenues" means, for any period, all revenues received by the
---------------
Borrower or any Subsidiary during such period, including all revenues and
proceeds received by them from (a) sales, leases or other dispositions of
Capacity (including revenues and proceeds derived from Permitted Receivables
Transactions (other than any such revenues and proceeds that constitute Net Cash
Proceeds)), (b) the sale, lease, transfer or other disposition of any of their
assets, (c) all payments made by purchasers of Capacity to the Borrower or any
Subsidiary in respect of operation, administration and maintenance charges, (d)
all payments made by insurers under
32
business interruption policies and (e) all payments received by the Borrower
under Hedging Agreements after the Commercial Operation Date but excluding from
--- ---------
System Revenues all Special Payments, Casualty Proceeds, Net Cash Proceeds and
Backhaul Revenues (other than any Backhaul Revenues designated for transfer to
the Revenue Account (whether directly or after being held in another Account)
pursuant to the Securities Accounts Agreement).
"Taxes" means any and all present or future taxes, levies, imposts, duties,
-----
deductions, charges or withholdings imposed by any Governmental Authority.
"Term Loans" means the Tranche A-1 Term Loans and the Tranche A-2 Term
----------
Loans.
"Term Loan Commitment" means the Tranche A-1 Term Loan Commitment and the
--------------------
Tranche A-2 Term Loan Commitment.
"Term Notes" is defined in Section 2.08(e).
---------- ---------------
"Termination Date" means, with respect to any Class of Loans, the last day
----------------
of the Availability Period applicable to such Class of Loans.
"Three Capacity" means that capacity on the System which is available on
--------------
Segment 3.
"Tranche A Term Loans" means, collectively, Tranche A-1 Term Loans and
--------------------
Tranche A-2 Term Loans.
"Tranche A Term Loan Commitment" means, collectively, the Tranche A-1 Term
------------------------------
Loan Commitment and the Tranche A-2 Term Loan Commitment.
"Tranche A Term Notes" means, collectively, the Tranche A-1 Term Notes and
--------------------
the Tranche A-2 Term Notes.
"Tranche A-1 Term Loans" is defined in Section 2.01.
---------------------- ------------
"Tranche A-1 Term Loan Commitment" means, (a) as to any Lender, its
--------------------------------
obligation to make Tranche A-1 Term Loans to the Borrower in an aggregate amount
not to exceed at any one time outstanding the amount set forth opposite such
Lender's name on Schedule 2.01 under the
-------------
33
heading "Tranche A-1 Term Loan Commitment" or, in the case of a Lender that is
an assignee, the amount of the assigning Lender's Tranche A-1 Term Loan
Commitment assigned to such assignee pursuant to Section 9.04 and (b) in the
------------
aggregate, $219,300,000, in each case as such amount may be adjusted from time
to time as provided herein.
"Tranche A-1 Term Note" is defined in Section 2.08(e).
--------------------- ---------------
"Tranche A-2 Term Loans" is defined in Section 2.01.
---------------------- ------------
"Tranche A-2 Term Loan Commitment" means, (a) as to any Lender, its
--------------------------------
obligation to make Tranche A-2 Term Loans to the Borrower in an aggregate amount
not to exceed at any one time outstanding the amount set forth opposite such
Lender's name on Schedule 2.01 under the heading "Tranche A-2 Term Loan
-------------
Commitment" or, in the case of a Lender that is an assignee, the amount of the
assigning Lender's Tranche A-2 Term Loan Commitment assigned to such assignee
pursuant to Section 9.04 and (b) in the aggregate, $30,700,000, in each case as
------------
such amount may be adjusted from time to time as provided herein.
"Tranche A-2 Term Note" is defined in Section 2.08(e).
--------------------- ---------------
"TSSL" means Tyco Submarine Systems Inc., a Delaware corporation.
----
"Two Capacity" means that capacity on the System which is available on
------------
Segment 2.
"Tyco" means Tyco International Ltd., a Bermuda corporation and the
----
ultimate parent of TSSL.
"Tyco Contract Price" means "Contract Price" as defined in the Tyco Supply
-------------------
Contract.
"Tyco Contract Variation" means any amendment, supplement, waiver, consent
-----------------------
or other modification to the Tyco Supply Contract and shall include any
"Contract Variation" as such term is defined in the Tyco Supply Contract.
"Tyco Escrow Agent" means the escrow agent under the Contractor Escrow
-----------------
Agreement in connection with the Tyco Supply Contract, and each of its
successors and assigns as such thereunder.
"Tyco Escrow Dispute Account" means the "Dispute Account" as defined in the
---------------------------
Contractor Escrow Agreement in connection with the Tyco Supply Contract.
"Tyco Guarantee" means the Guaranty made by the Tyco in favor of the
--------------
Borrower, pursuant to which Tyco will guarantee TSSL's obligation under the Tyco
Supply Contract.
"Tyco Plan of Work" means the plan of work described in the Tyco Supply
-----------------
Contract.
"Tyco Supply Contract" means the Project Development and Construction
--------------------
Contract, between TSSL and the Borrower providing for the construction and
installation of the landing stations in New York and Florida.
"Type," when used in reference to any Loan or Borrowing, refers to whether
----
the rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
"UCC" means the Uniform Commercial Code in effect from time to time in the
---
State of New York.
"Unrestricted Contingency" means, at any time, the then unallocated portion
------------------------
of the line item in the Capital Budget titled "Unrestricted Contingency
Reserve."
34
"U.K. Backhaul Account" is defined in Section 2.16.1 of the Securities
--------------------- --------------
Accounts Agreement.
"U.K. Capital Cost Account" is defined in Section 2.2.1 of the Securities
------------------------- -------------
Accounts Agreement.
"U.K. Casualty Proceeds Account" is defined in Section 2.20.1 of the
------------------------------ --------------
Securities Accounts Agreement.
"U.K. Checking Account" means a checking account of the U.K. Subsidiary
---------------------
into which funds may be deposited and withdrawn in accordance with Section 2.26
------------
of the Securities Accounts Agreement.
"U.K. O&M Account" is defined in Section 2.11.1 of the Securities Accounts
---------------- --------------
Agreement.
"U.K. Revenue Account" is defined in Section 2.8.1 of the Securities
-------------------- -------------
Accounts Agreement.
"U.K. Sales and Issuances Account" is defined in Section 2.23.1 of the
-------------------------------- --------------
Securities Accounts Agreement.
"U.K. Subsidiary" means Mid-Atlantic Crossing Holdings UK Ltd, a
---------------
corporation organized under the laws of the United Kingdom and a direct, wholly-
owned subsidiary of the Borrower.
"U.K. Subsidiary Accounts" shall be the collective reference to the U.K.
------------------------
Capital Cost Account, the U.K. Upgrade Account, the U.K. Revenue Account, the
U.K. O&M Account, the U.K. Backhaul Account, the U.K. Casualty Proceeds Account,
the U.K. Sales and Issuances Proceeds Account and each other account, together
with each sub-account of any such account, established and maintained on behalf
of the U.K. Subsidiary pursuant to the provisions of the Securities Accounts
Agreement.
"U.K. Subsidiary Guaranty Agreement" means the Guaranty Agreement, dated as
----------------------------------
of the date hereof, made by the U.K. Subsidiary in favor of the Administrative
Agent.
"U.K. Subsidiary Pledge Agreement (New York Law)" means the Pledge
-----------------------------------------------
Agreement (New York Law) dated as of the date hereof, made by the U.K.
Subsidiary in favor of the Administrative Agent.
"U.K. Subsidiary Security Agreement (English Law)" means the Deed of Charge
------------------------------------------------
(English Law), dated as of the date hereof, made by the U.K. Subsidiary in favor
of the Administrative Agent.
"U.K. Subsidiary Security Agreement (New York Law)" means the Subsidiary
-------------------------------------------------
Security Agreement (New York Law), dated as of the date hereof, made by the U.K.
Subsidiary in favor of the Administrative Agent.
35
"U.K. Subsidiary Security Agreements" means the U.K. Subsidiary Security
-----------------------------------
Agreement (New York Law) and the U.K. Subsidiary Security Agreement (English
Law).
"Upgrade Account" is defined in Section 2.4.1 of the Securities Accounts
--------------- -------------
Agreement.
"Upgrade Delay Proceeds Sub-Account" is defined in Section 2.4.1 of the
---------------------------------- -------------
Securities Account Agreement.
"Upgrade Loan Proceeds Sub-Account" is defined in Section 2.4.1 of the
--------------------------------- -------------
Securities Account Agreement.
"Upgraded System" means the Basic System, after taking into account the
---------------
First Permitted Upgrade thereof.
"U.S. Backhaul Account" is defined in Section 2.17.1 of the Securities
--------------------- --------------
Accounts Agreement.
"U.S. Capital Cost Account" is defined in Section 2.3.1 of the Securities
------------------------- -------------
Accounts Agreement.
"U.S. Casualty Proceeds Account" is defined in Section 2.21.1 of the
------------------------------ --------------
Securities Accounts Agreement.
"U.S. Checking Account" means a checking account of the U.S. Subsidiary
---------------------
into which funds may be deposited and withdrawn in accordance with Section 2.26
------------
of the Securities Accounts Agreement.
"U.S. Delay Proceeds Sub-Account" is defined in Section 2.3.1 of the
------------------------------- -------------
Securities Accounts Agreement.
"U.S. Landing License" means any Landing License with respect to the United
--------------------
States.
"U.S. O&M Account" is defined in Section 2.12.1 of the Securities Accounts
---------------- --------------
Agreement.
"U.S. Revenue Account" is defined in Section 2.9.1 of the Securities
-------------------- -------------
Accounts Agreement.
"U.S. Sales and Issuances Account" is defined in Section 2.24.1 of the
-------------------------------- --------------
Securities Accounts Agreement.
"U.S. Subsidiary" means MAC Landing Corp., a Delaware corporation and an
---------------
indirect, wholly owned subsidiary of the Borrower.
"U.S. Subsidiary Accounts" shall be the collective reference to the U.S.
------------------------
Capital Cost Account, U.S. Delay Proceeds Sub-Account, the U.S. Upgrade Account,
the U.S. Upgrade Delay Proceeds Sub-Account, the U.S. Revenue Account, the U.S.
O&M Account, the U.S. Backhaul Account, the U.S. Casualty Proceeds Account, the
U.S. Sales and Issuances Proceeds Account,
36
and each other account, together with each sub-account of any such account,
established and maintained on behalf of the U.S. Subsidiary pursuant to the
provisions of the Securities Accounts Agreement.
"U.S. Subsidiary Guaranty Agreement" means the Guaranty Agreement, dated as
----------------------------------
of the date hereof, made by the U.S. Subsidiary in favor of the Administrative
Agent.
"U.S. Subsidiary Security Agreement" means the Subsidiary Security
----------------------------------
Agreement, dated as of the date hereof, made by the U.S. Subsidiary in favor of
the Administrative Agent.
"U.S. Upgrade Account" is defined in Section 2.6.1 of the Securities
-------------------- -------------
Accounts Agreement.
"U.S. Upgrade Delay Proceeds Sub-Account" is defined in Section 2.6.1 of
--------------------------------------- -------------
the Securities Accounts Agreement.
"Voting Stock" means, with respect to any Person, securities of any class
------------
or classes of Capital Stock in such Person entitling the holders thereof to vote
under ordinary circumstances in the election of members of the board of
directors or other governing body of such Person.
"Withdrawal Liability" means liability to a Multiemployer Plan as a result
--------------------
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.
"Working Capital Loan Commitment" means, (a) as to any Lender, its
-------------------------------
obligation to make Working Capital Loans to the Borrower in an aggregate amount
not to exceed at any one time outstanding the amount set forth opposite such
Lender's name on Schedule 2.01 under the heading "Working Capital Loan
-------------
Commitment" or, in the case of a Lender that is an assignee, the amount of the
assigning Lender's Working Capital Loan Commitment assigned to such assignee
pursuant to Section 9.04 and (b) in the aggregate, $10,000,000, in each case as
------------
such amount may be adjusted from time to time as provided herein.
"Working Capital Loans" is defined in Section 2.01.
--------------------- ------------
"Working Capital Note" is defined in Section 2.08(e).
-------------------- ---------------
SECTION 1.02. Classification of Loans and Borrowings.
--------------------------------------
For purposes of this Agreement, Loans may be classified and referred to by
Class (e.g., a "Working Capital Loan") or by Type (e.g., a "Eurodollar Loan") or
-------------------- ---------------
by Class and Type (e.g., a "Eurodollar Working Capital Loan"). Borrowings also
-------------------------------
may be classified and referred to by Class (e.g., a "Working Capital Borrowing")
-------------------------
or by Type (e.g., a "Eurodollar Borrowing") or by Class and Type (e.g., a
--------------------
"Eurodollar Working Capital Borrowing").
-------------------------------------
SECTION 1.03. Terms Generally.
---------------
The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any
pronoun shall include the corresponding masculine, feminine and neuter forms.
The words
37
"include" "includes'' and "including" shall be deemed to be followed by the
phrase "without limitation." The word "will" shall be construed to have the same
meaning and effect as the word "shall." Except to the extent expressly provided
to the contrary, (a) any definition of or reference to any agreement, instrument
or other document herein shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented, amended
and restated or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein," "hereof" and "hereunder," and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; Exchange Rates.
--------------------------------
(a) Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time.
(b) If any amount that the Borrower or a Subsidiary is entitled to
receive in cash is payable in any currency other than Dollars (such entitlement
being referred to as a "Deferred Non-Dollar Revenue"), such amount shall, in
---------------------------
order to attribute a Dollar value to such Deferred Non-Dollar Revenue for
purposes of any calculation which incorporates any such Deferred Non-Dollar
Revenue, be converted into Dollars using the spot exchange rate for such
currency into Dollars on the date such calculation is made; provided that if the
--------
Borrower or any Subsidiary has entered into a Hedging Agreement in respect of
such Deferred Non-Dollar Revenue which effectively fixes the exchange rate into
Dollars for such Deferred Non-Dollar Revenue, the conversion into Dollars
referred to above shall be made at the exchange rate effectively fixed by such
Hedging Agreement. In addition, if any calculation refers to a price received
by the Borrower or a Subsidiary, such price shall, if in a currency other than
Dollars, be converted into Dollars using the spot exchange rate for such
currency into Dollars on the date such calculation is made.
ARTICLE II.
THE COMMITMENTS
---------------
SECTION 2.01. Commitments.
-----------
Subject to the terms and conditions set forth herein, (a) each Lender
severally agrees to make working capital loans ("Working Capital Loans") to the
---------------------
Borrower from time to time during the Availability Period in an aggregate
principal amount not to exceed such Lender's Working Capital Loan Commitment,
(b) each Lender severally agrees to make term loans ("Tranche A-1 Term Loans")
----------------------
to the Borrower from time to time during the Availability Period in an aggregate
principal amount not to exceed such Lender's Tranche A-1 Term Loan Commitment
and (c) each Lender severally agrees to make term loans ("Tranche A-2 Term
----------------
Loans") to the Borrower from time to time during the
38
Availability Period in an aggregate principal amount not to exceed such Lender's
Tranche A-2 Term Loan Commitment. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may, from and after the
Closing Date, borrow, and from and after the Commercial Operation Date, borrow,
prepay and reborrow, Working Capital Loans in an amount such that the aggregate
principal amount of Working Capital Loans outstanding at any time does not
exceed the Working Capital Loan Commitment. Amounts repaid or prepaid in respect
of Term Loans may not be reborrowed.
SECTION 2.02. Loans and Borrowings.
--------------------
(a) Each Loan shall be made as part of a Borrowing consisting of Loans
of the same Class and Type made by the Lenders ratably in accordance with their
respective Commitments in respect of the applicable Class. The failure of any
Lender to make any Loan required to be made by it shall not relieve any other
Lender of its obligations hereunder; provided that the Commitments of the
--------
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make Loans as required hereby.
(b) Each Working Capital Borrowing and Term Loan Borrowing may be ABR
Loans or Eurodollar Loans, or a combination thereof, as the Borrower may request
in accordance herewith.
(c) In the case of Term Loan Borrowings or Working Capital Borrowings
prior to the Commercial Operation Date, each ABR Borrowing and each Eurodollar
Borrowing shall be in an aggregate amount that is not less than $5,000,000, and
in the case of Working Capital Borrowings on and after the Commercial Operation
Date, each ABR Borrowing and each Eurodollar Borrowing shall be in an aggregate
amount that is not less than $1,000,000 or is in an integral multiple of
$100,000 in excess thereof; provided that any such Borrowing may be in an
--------
aggregate amount that is equal to the entire unused balance of the total Term
Loan Commitments or Working Capital Commitments, as the case may be. Borrowings
of more than one Type and Class may be outstanding at the same time; provided
--------
that there shall not at any time be more than a total of eight Eurodollar
Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the applicable Maturity Date.
SECTION 2.03. Requests for Borrowings and Other Credit Extensions.
---------------------------------------------------
(a) Credit Extension Requests. To request a Credit Extension, the
-------------------------
Borrower shall deliver a properly completed Credit Extension Request to the
Administrative Agent (a) in the case of a Eurodollar Borrowing, not later than
11:00 a.m., New York City time, 3 Business Days before the date of the proposed
Borrowing or (b) in the case of an ABR Borrowing or of any other Credit
Extension, not later than 11:00 a.m., New York City time, 1 Business Day before
the date of the proposed Borrowing or Credit Extension. Except with respect to
Working Capital Loans requested after the Commercial Operation Date, the
Borrower shall request Credit Extensions no more frequently than once per month,
except as necessary to permit any final
39
drawings pursuant to Section 2.04(b). Each Credit Extension Request shall be
---------------
irrevocable and shall specify the following information in compliance with
Section 2.02:
------------
(i) whether the requested Credit Extension is to be a
Working Capital Loan, a Tranche A-1 Term Loan, a Tranche A-2 Term Loan or
the transfer or withdrawal of funds that are on deposit, or are expected by
the requested Credit Extension Date to be on deposit, in a sub-account of
the Construction Account or the Upgrade Loan Proceeds Sub-Account;
(ii) the aggregate amount of the requested Borrowing or other
Credit Extension;
(iii) the date of such Credit Extension, which shall be a
Credit Extension Date;
(iv) if the requested Credit Extension consists of a
Borrowing, whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and
(v) in the case of a Eurodollar Borrowing, the initial
Interest Period applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period."
If no election as to the Type of any requested Borrowing is specified, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurodollar Borrowing, then the Borrower
shall be deemed to have selected an Interest Period of one month's duration.
Promptly after receipt of a Credit Extension Request, the Administrative Agent
shall review such Credit Extension Request and the attachments thereto to
determine whether all required documentation has been provided in form and
substance reasonably satisfactory to the Administrative Agent and shall (i)
notify the Borrower and the Securities Intermediary of its determination and
(ii) advise each applicable Lender of the details thereof and, if the Credit
Extension Request requests a Borrowing, of the amount of such Lender's Loan to
be made as part of the requested Borrowing.
(b) Credit Extension Certificates. The Borrower shall by 11:00 am on
-----------------------------
each Credit Extension Date designated in a Credit Extension Request, deliver to
the Administrative Agent a Credit Extension Certificate certifying, if such is
the case, that all conditions precedent to the makings of such Credit Extension
have been satisfied, and the Administrative Agent shall, upon receipt of a
properly completed Credit Extension Certificate, deliver such Credit Extension
Certificate to the Securities Intermediary.
SECTION 2.04. Special Provisions for Credit Extensions.
----------------------------------------
(a) Delay Proceeds. At any time that funds are on deposit in the
--------------
Delay Proceeds Sub-Account, the U.S. Delay Proceeds Sub-Account, the Upgrade
Delay Proceeds Sub-Account or the U.S. Upgrade Delay Proceeds Account, (i) the
Borrower shall make Credit Extension Requests designating that amounts to be
withdrawn from the Construction Account be
40
withdrawn from the Delay Proceeds Sub-Account or the Upgrade Delay Proceeds Sub-
Account, as applicable, until such time as no funds remain on deposit therein,
and such Credit Extension Requests shall not request that any Loans be made
until the funds on deposit in such sub-account have been (or, concurrently with
the making of any requested Loan, will be) fully utilized and (ii) no amounts
shall be transferred to the U.S. Capital Cost Account from the Construction
Account or any sub-account thereof until all funds on deposit in or credited to
the U.S. Delay Proceeds Account and the U.S. Upgrade Delay Proceeds Account have
been fully utilized.
(b) First Loan. On the Closing Date and prior to the advancing of any
----------
Tranche A-2 Term Loans or Working Capital Loans, the Borrower shall make a
Credit Extension Request in respect of a Tranche A-1 Term Loan (the "First
-----
Loan") in an amount equal to $9,192,115.88 which shall represent the aggregate
----
principal amount due with respect to (i) the fees and expenses payable to the
Co-Arrangers, the Agents and the Lenders on the Closing Date in connection with
the transactions contemplated hereby (including the reasonable fees and expenses
of counsel and consultants to the Co-Arrangers, the Agents, the Lenders and the
Borrower) and (ii) the fee payable by the Borrower to GCDC pursuant to the
Financial Services Agreement.
(c) Tranche A-2 Term Loan Borrowings and Working Capital Borrowings
---------------------------------------------------------------
Prior to the Commercial Operation Date. The proceeds of Tranche A-2 Term Loans
--------------------------------------
and, prior to the Commercial Operation Date, Working Capital Loans shall be used
solely to pay Capital Costs in respect of the First Permitted Upgrade in
accordance with the Capital Budget and to pay for the purchase of Backhaul
Capacity by the Borrower and its Subsidiaries in accordance with the Capital
Budget, subject, in each such case, to the satisfaction of the conditions set
forth in Sections 4.02(k) and 4.02(l) and the other conditions precedent to the
---------------- -------
making of Credit Extensions set forth in Section 4.02. Borrowings of Tranche A-
------------
2 Term Loans and, prior to the Commercial Operation Date, Working Capital Loans
for application to the purchase of Backhaul Capacity shall not exceed, in the
aggregate (taking into account all previous Borrowings of Tranche A-2 Term Loans
and Working Capital Loans for such purposes), the lesser of (x) 50% of Excess
System Capacity Sales and (y) $15,000,000. All Tranche A-2 Term Loan and
Working Capital Loan proceeds requested for the purpose of paying Capital Costs
associated with the First Permitted Upgrade in accordance with the Capital
Budget shall be deposited into the Upgrade Loan Proceeds Sub-Account, and all
Tranche A-2 Term Loan and Working Capital Loan proceeds requested for the
purpose of paying for the purchase of Backhaul Capacity in accordance with the
Capital Budget shall be deposited into the Backhaul Account, in each case, for
application in accordance with the applicable provisions of the Securities
Accounts Agreement. At any time that funds are on deposit in the Upgrade Delay
Proceeds Sub-Account or the U.S. Upgrade Delay Proceeds Sub-Account, the
Borrower shall make Credit Extension Requests designating that amounts to be
withdrawn from the Upgrade Loan Proceeds Sub-Account be withdrawn from such sub-
account until such time as no funds remain on deposit therein, and such Credit
Extension Requests shall not request that any Loans be made until the funds on
deposit in such sub-account have been (or, currently with the making of any
requested Loan, will be) fully utilized. If, on the earlier to occur of the
Commercial Operation Date and the Guaranteed Completion Date, all or any portion
of the Tranche A-2 Term Loan Commitment remains undrawn, the Borrower shall be
required to submit a Credit Extension Request
41
requesting a Borrowing of Tranche A-2 Term Loans in an amount equal to the then
undrawn Tranche A-2 Term Loan Commitments, for deposit into the Upgrade Loan
Proceeds Sub-Account.
(d) Provisions Regarding Clean-Up Borrowing. Contemporaneously with
---------------------------------------
or immediately prior to the Termination Date with respect to the Tranche A-1
Term Loans, the Borrower shall request a final Tranche A-1 Term Loan Borrowing
in accordance with the provisions of Section 2.03 in order to pay or provide for
------------
the Final Contractor Payment and any other Capital Costs identified in the then
current Capital Budget with respect to the Basic System but not yet due and
payable as of such Termination Date, and the Administrative Agent shall deposit
the proceeds of such Borrowings in the Clean-Up Sub-Account pursuant to the
provisions of the Securities Accounts Agreement. The amount to be so requested
shall be equal to the lesser of (i) the aggregate amount of the Tranche A-1 Term
Loan Commitment so remaining available and (ii) the aggregate estimated amount
of such Final Contractor Payment and other Capital Costs. After giving effect
to the foregoing, contemporaneously with or immediately prior to the Termination
Date with respect to the Tranche A-1 Term Loans the Borrower may submit a Credit
Extension Request requesting a Borrowing of Tranche A-1 Term Loans for deposit
into the Backhaul Account in an amount not to exceed the lesser of (a) the
aggregate amount of the Tranche A-1 Term Loan Commitment so remaining available
and (b) the then available Unrestricted Contingency, if any.
SECTION 2.05. Funding Of Borrowings.
---------------------
(a) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds by 12:00
noon, New York City time, to the account of the Administrative Agent most
recently designated by the Administrative Agent for such purpose by notice to
the Lenders. The Administrative Agent will make such Loans available to the
Borrower by promptly transferring the amounts so received, in like funds, to the
applicable Account pursuant to the provisions of the Securities Accounts
Agreement.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender agrees to pay to the Administrative Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at the Federal Funds Effective Rate for
3 days and at the Alternate Base Rate thereafter. If such Lender pays such
amount to the Administrative Agent, then such amount shall constitute such
Lender's Loan included in such Borrowing.
42
SECTION 2.06. Interest Elections.
------------------
(a) Each Working Capital Borrowing and Term Loan Borrowing initially
shall be of the Type specified in the applicable Credit Extension Request and,
in the case of a Eurodollar Borrowing, shall have an initial Interest Period as
specified in such Credit Extension Request. Thereafter, the Borrower may elect
to convert such Borrowing to a different Type or to continue such Borrowing and,
in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all
as provided in this Article II. The Borrower may elect different options with
----------
respect to different portions of the affected Borrowing, in which case each such
portion shall be allocated ratably among the Lenders holding the Loans
comprising such Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by delivering a
Continuation/Conversion Notice to the Administrative Agent by the time that a
Credit Extension Request would be required under Section 2.03 if the Borrower
------------
were requesting a Borrowing of the Type resulting from such election to be made
on the effective date of such election. Each such notice shall be irrevocable.
(c) Each Continuation/Conversion Notice shall specify the following
information in compliance with Section 2.02:
------------
(i) the Borrowing to which such Continuation/Conversion
Notice applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to each
resulting Borrowing (in which case the information to be specified pursuant
to clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);
(ii) the effective date of the election made pursuant to such
Continuation/Conversion Notice, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing,
the Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period."
If any such Continuation/Conversion Notice requests a Eurodollar Borrowing but
does not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of a Continuation/Conversion Notice,
the Administrative Agent shall advise each applicable Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
43
(e) If the Borrower fails to deliver a timely Continuation/Conversion
Notice with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Majority Lenders, so notifies the Borrower, then, so long as an
Event of Default is continuing (i) no outstanding Borrowing may be converted to
or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.
SECTION 2.07. Termination and Reduction of Commitments.
----------------------------------------
(a) Unless previously terminated, each Commitment shall terminate on
the Termination Date in respect thereof.
(b) The Borrower shall notify the Administrative Agent of any election
to terminate or reduce the Commitments under paragraph (c) of this Section at
least 5 Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof. Promptly
following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof. Each notice delivered by the Borrower pursuant
to this Section 2.07 shall be irrevocable. Any termination or reduction of the
------------
Commitments shall be permanent. Each reduction of the Commitments of any Class
shall be made ratably among the Lenders in accordance with their respective
Commitments of such Class.
(c) The Borrower may at any time terminate, or from time to time
reduce, the Commitments of any Class; provided that (i) each reduction of the
--------
Commitments of any Class shall be in an amount that is an integral multiple of
$1,000,000, (ii) the Borrower shall not terminate or reduce the Term Loan
Commitments if the remaining Term Loan Commitments, together with other funds
available to the Borrower, would not, in the reasonable judgment of the
Administrative Agent, be sufficient to pay the remaining amounts owing under the
Supply Contracts and the other costs necessary to complete the System and (iii)
the Borrower shall not terminate or reduce the Tranche A-2 Term Loan Commitment
prior to First Permitted Upgrade Final Completion if the amounts on deposit in
the Upgrade Account (together with other funds available to the Borrower on
terms satisfactory to the Lead Agents) would not, in the reasonable judgment of
the Administrative Agent, be sufficient to pay all costs necessary to complete
the First Permitted Upgrade.
SECTION 2.08. Repayment of Loans; Evidence of Debt.
------------------------------------
(a) The Borrower hereby unconditionally promises to repay (i) the
Working Capital Borrowings as set forth under the heading "Working Capital Loan
Amortization Schedule" on Schedule 2.08, (ii) the Tranche A-1 Term Loan
-------------
Borrowings as set forth under the heading "Tranche A-1 Term Loan Amortization
Schedule" on Schedule 2.08 and (iii) the Tranche A-2 Term Loan Borrowings as set
-------------
forth under the heading "Tranche A-2 Term Loan Amortization Schedule" on
Schedule 2.08; provided that (1) at no time shall the Borrower be obligated to
------------- --------
make payments of principal of Loans hereunder in an amount greater than the
total
44
principal of Loans then outstanding hereunder and (2) in the event that
the Borrower did not draw the full amount of any Term Loan Commitment, the
aggregate principal amount of the corresponding Term Loans payable hereunder
shall be reduced by such amount not drawn (such reduction to be applied to then
remaining installments of principal of such Term Loans pro rata).
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain the Register pursuant to Section 9.04(c) and a sub-
---------------
account therein for each Lender, in which it shall record (i) the amount of each
Loan and each obligation evidenced by a Note made hereunder, the Class and Type
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the Register and the accounts maintained
pursuant to paragraph (b) or (c) of this Section shall constitute prima facie
----- -----
evidence of the existence and amounts of the obligations recorded therein;
provided that the failure of any Lender or the Administrative Agent to maintain
--------
such accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Loans in accordance with the terms of this
Agreement.
(e) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender, as
applicable, (i) a promissory note of the Borrower payable to the order of such
Lender and its registered assigns evidencing the Tranche A-1 Term Loans of such
Lender and substantially in the form of Exhibit A-1, with appropriate insertions
-----------
as to date and principal amount (each, a "Tranche A-1 Term Note"), (ii) a
---------------------
promissory note of the Borrower payable to the order of such Lender and its
registered assigns evidencing the Tranche A-2 Term Loans of such Lender and
substantially in the form of Exhibit A-2, with appropriate insertions as to date
-----------
and principal amount (each a "Tranche A-2 Term Note") and (iii) a promissory
---------------------
note of the Borrower payable to the order of such Lender and its registered
assigns evidencing the Working Capital Loans of such Lender and substantially in
the form of Exhibit A-3, with appropriate insertions as to date and principal
-----------
amount (each, a "Working Capital Note"). Thereafter, the Loans evidenced by any
--------------------
such Note and interest thereon shall at all times (including after assignment
pursuant to Section 9.04) be represented by one or more Notes payable to the
------------
order of the payee named therein and its registered assigns. A Note and the
obligation evidenced thereby may be assigned or otherwise transferred in whole
or in part only by registration of such assignment or transfer of such Note and
the obligation evidenced thereby in the Register (and each Note shall expressly
so provide). Any assignment or transfer of all or part of an obligation
evidenced by a Note shall be registered in the Register only upon surrender for
registration of assignment or transfer of the Note evidencing such obligation,
accompanied by an Assignment and Acceptance duly executed by the assignor
thereof, and
45
thereupon, if requested by the assignee, one or more new Notes shall be issued
to the designated assignee and the old Note shall be returned by the
Administrative Agent to the Borrower marked "canceled." No assignment of a Note
and the obligation evidenced thereby shall be effective unless it shall have
been recorded in the Register by the Administrative Agent as provided in this
Section 2.08(e).
---------------
SECTION 2.09. Optional Prepayments of Loans.
-----------------------------
(a) The Borrower shall have the right at any time and from time to
time to prepay any Borrowing in whole or in part, without premium or penalty,
subject to prior notice in accordance with paragraph (b) of this Section and
subject to the provisions of paragraph (c) of this Section and Section 2.15.
------------
(b) The Borrower shall notify the Administrative Agent in writing or
by telephone (confirmed by telecopy) of any optional prepayment hereunder, not
later than 11:00 a.m., New York City time, 5 Business Days before the date of
prepayment. Each such notice shall be irrevocable and shall specify, in the
case of any prepayment of Loans, the date and amount of prepayment and whether
the prepayment is (i) of Tranche A-1 Term Loans, Tranche A-2 Term Loans, Working
Capital Loans or a combination thereof and (ii) of Eurodollar Loans, ABR Loans
or a combination thereof, and, in each case if a combination thereof, the
principal amount allocable to each, and shall specify how such prepayment shall
be applied to the remaining installments of the Loans. Promptly following
receipt of any such notice, the Administrative Agent shall advise the Lenders of
the contents thereof. Partial optional prepayments shall be in a minimum
aggregate principal amount of $5,000,000 and integral multiples of $100,000 in
excess thereof. Optional prepayments shall be accompanied by accrued interest
to the extent required by Section 2.12. Without in any way limiting the
------------
obligation of the Borrower to confirm in writing any notice it may give
hereunder by telephone, the Administrative Agent may act prior to receipt of
written confirmation without liability upon the basis of such telephonic notice
believed by the Administrative Agent in good faith to be from a Responsible
Officer of the Borrower (or a designee of such Responsible Officer).
(c) Optional prepayments shall be applied to the installments of the
Loans as specified by the Borrower in the notice of prepayment set forth in
paragraph (b) of this Section provided that the Borrower shall not be permitted
--------
to voluntarily prepay Tranche A-2 Term Loans until First Permitted Upgrade Final
Completion.
SECTION 2.10. Mandatory Prepayments.
---------------------
(a) The Borrower shall prepay the outstanding Term Loans in the amount
designated for transfer to the Administrative Agent for application to the
prepayment of the Term Loans pursuant to Section 2.7.3(a) of the Securities
----------------
Accounts Agreement (and such prepayment shall, notwithstanding anything to the
contrary in the Securities Accounts Agreement or otherwise, be required to be
made in such amount notwithstanding that there may be insufficient funds then on
deposit in the Revenue Account to do so).
46
(b) On each Principal Payment Date, the Borrower shall prepay the
outstanding Term Loans in the amount designated for transfer to the
Administrative Agent for application to the prepayment of the Term Loans
pursuant to Section 2.7.4(a) of the Securities Accounts Agreement (and such
----------------
prepayment shall, notwithstanding anything to the contrary in the Securities
Accounts Agreement or otherwise, be required to be made in such amount
notwithstanding that there may be insufficient funds then on deposit in the
Revenue Account to do so).
(c) The Borrower shall prepay the outstanding Term Loans in the amount
designated for transfer to the Administrative Agent for application to the
prepayment of the Term Loans pursuant to Sections 2.22.3(a), 2.23.3, and
------------------ ------
2.24.3(a) of the Securities Accounts Agreement (and such prepayment shall,
---------
notwithstanding anything to the contrary in the Securities Accounts Agreement or
otherwise, be required to be made in such amount notwithstanding that there may
be insufficient funds then on deposit in the Sales and Issuances Proceeds
Account to do so).
(d) The Borrower shall prepay the outstanding Term Loans in the amount
designated for transfer to the Administrative Agent for application to the
prepayment of the Term Loans pursuant to Sections 2.19.3(c) and 2.19.3(d) of the
------------------ ---------
Securities Accounts Agreement (and such prepayment shall, notwithstanding
anything to the contrary in the Securities Accounts Agreement or otherwise, be
required to be made in such amount notwithstanding that there may be
insufficient funds then on deposit in the Casualty Proceeds Account to do so).
(e) The Borrower shall prepay the outstanding Working Capital Loans in
the amount designated for transfer to the Administrative Agent for application
to the prepayment of the Working Capital Loans pursuant to Section 2.1.4 of the
-------------
Securities Accounts Agreement.
(f) Mandatory prepayments shall be accompanied by accrued interest to
the extent required by Section 2.12, and each mandatory prepayment described in
------------
this Section shall be of a principal amount of Term Loans such that the amount
designated for transfer to the Administrative Agent for application to the
prepayment of Term Loans is sufficient to pay such principal amount plus accrued
interest thereon to the date of prepayment.
(g) Fifty percent of each mandatory prepayment of the Term Loans made
pursuant to this Section 2.10 shall be applied to the installments thereof in
------------
the direct order of maturity thereof and fifty percent of each mandatory
prepayment of the Term Loans made pursuant to this Section 2.10 be applied to
------------
the installments thereof in the inverse order of maturity thereof (in each case,
pro rata according to respective outstanding principal amounts among the then
outstanding Tranche A-1 Term Loans and Tranche A-2 Term Loans).
(h) Upon making a mandatory prepayment pursuant to this Section, the
Borrower shall have the right (i) first, to apply such prepayment to the ABR
Loans and to any and all Eurodollar Loans having Interest Period(s) ending on
the date of such prepayment and (ii) then, with respect to Eurodollar Loans
having Interest Period(s) ending on a day other than the date of such
prepayment, to deposit cash in a cash collateral account, on terms and subject
to documentation reasonably satisfactory to the Administrative Agent, sufficient
to prepay in full such Eurodollar Loans (together with accrued interest thereon)
at the end of the applicable
47
Interest Period(s). Any amounts so deposited shall be held in a cash collateral
account and shall be applied to the prepayment of the applicable Eurodollar
Loans at the end of the current Interest Periods applicable thereto. The
Administrative Agent shall invest funds in any such cash collateral account in
overnight investments constituting Permitted Investments.
SECTION 2.11. Fees.
----
(a) The Borrower agrees to pay to the Administrative Agent for the
account of each Lender a commitment fee, which shall accrue at the rate of 0.75%
per annum on the average daily unused portion of the Commitments of such Lender
during the period from the Closing Date to but excluding the date on which such
Commitment terminates. Accrued commitment fees shall be payable in arrears on
the last Business Day of each August, November, February and May of each year
and on the date on which the Commitments terminate, commencing on the first such
date to occur after the date hereof. All commitment fees shall be computed on
the basis of a year of 360 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day). For purposes
of computing commitment fees with respect to the Term Loan Commitments, a Term
Loan Commitment of a Lender shall be deemed to be used to the extent of the
outstanding Term Loans of such Lender. For purposes of computing commitment
fees with respect to the Working Capital Loan Commitments, a Working Capital
Loan Commitment shall be deemed to be used to the extent of the outstanding
Working Capital Loans of such Lender.
(b) The Borrower agrees to pay to the Administrative Agent and the
Lead Agents, for their own accounts, the fees payable in the amounts and at the
times separately agreed upon between the Borrower, the Administrative Agent and
the Lead Agents in the Fee Letter.
(c) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for distribution to the
Lenders (in the case of paragraph (a) of this Section) or for the account of the
Lead Agents or the Administrative Agent, as the case may be (in the case of
paragraph (b) of this Section).
SECTION 2.12. Interest.
--------
(a) The Loans comprising each ABR Borrowing shall bear interest at a
rate per annum equal to the Alternate Base Rate plus the Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest
at a rate per annum equal to the Adjusted LIBO Rate for the Interest Period in
effect for such Borrowing plus the Applicable Rate.
(c) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any
48
Loan, 2% plus the rate otherwise applicable to such Loan as provided above or
(ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans
as provided above.
(d) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan; provided that (i) interest accrued pursuant
--------
to paragraph (c) of this Section shall be payable on demand, (ii) in the event
of any repayment or prepayment of any Loan, accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment, (iii) in the event of any conversion of any Eurodollar Borrowing
prior to the end of the current Interest Period therefor, accrued interest on
such Loan shall be payable on the effective date of such conversion and (iv) all
accrued interest shall be payable upon termination of the Commitments.
(e) All interest hereunder shall be computed on the basis of a year of
360 days, except that interest computed by reference to the Alternate Base Rate
at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day).
SECTION 2.13. Alternate Rate of Interest; Illegality.
--------------------------------------
(a) If prior to the commencement of any Interest Period for a
Eurodollar Borrowing:
(i) the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and reasonable
means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO
Rate, as applicable, for such Interest Period; or
(ii) the Administrative Agent is advised by the Majority Lenders
that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period will not adequately and fairly reflect the cost to such
Lenders of making or maintaining their Loans included in such Borrowing for
such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any
Continuation/Conversion Notice that requests the conversion of any Borrowing to,
or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
(b) Notwithstanding any other provision of this Agreement, if on or
after the date of this Agreement the adoption of or any change in any applicable
law or in the interpretation or application thereof shall make it unlawful for
any Lender to make or maintain Eurodollar Loans as contemplated by this
Agreement, (i) such Lender shall give telex, telecopy or telephonic notice
thereof to the Administrative Agent and the Borrower as soon as practicable
49
(and, with respect to any such telephonic notice, the party delivering the same
agrees to confirm such notice in writing), (ii) the commitment of such Lender
hereunder to make Eurodollar Loans and continue Eurodollar Loans as such shall
forthwith be canceled and (iii) such Lender's Loans then outstanding as
Eurodollar Loans, if any, shall be converted automatically to ABR Loans on the
respective last days of the then current Interest Periods with respect to such
Loans or within such earlier period as required by law. If any such conversion
of a Eurodollar Loan occurs on a day which is not the last day of the then
current Interest Period with respect thereto, the Borrower shall pay to such
Lender such amounts, if any, as may be required pursuant to Section 2.15.
------------
SECTION 2.14. Increased Costs.
---------------
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of, or credit extended or participated in by, any Lender (except
any such reserve requirement reflected in the Adjusted LIBO Rate); or
(ii) impose on any Lender any other condition affecting this
Agreement or Eurodollar Loans made by such Lender;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered.
(b) If any Lender determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on the
capital of such Lender or any holding company for such Lender as a consequence
of this Agreement or the Loans made by such Lender to a level below that which
such Lender or the holding company for such Lender could have achieved but for
such Change in Law (taking into consideration such Lender's policies with
respect to capital adequacy), then from time to time the Borrower will pay to
such Lender or such Lender's holding company, as the case may be, such
additional amount or amounts as will compensate such Lender for any such
reduction suffered.
(c) If any Lender becomes entitled to claim compensation pursuant to
this Section, such Lender shall promptly notify the Borrower (with a copy to the
Administrative Agent) of the event by reason of which it has become so entitled.
A certificate of a Lender setting forth the amount or amounts necessary to
compensate such Lender or such holding company, as the case may be, as specified
in paragraph (a) or (b) of this Section delivered to the Borrower (with a copy
to the Administrative Agent), shall constitute prima facie evidence of the
----- -----
correctness of the amount claimed.
(d) The Borrower shall pay such Lender all amounts payable pursuant to
the foregoing provisions of this Section 2.14 within 20 days after receipt of
------------
certification thereof from such Lender. Failure or delay on the part of any
Lender to demand compensation pursuant to this
50
Section shall not constitute a waiver of such Lender's right to demand such
compensation; provided that the Borrower shall not be required to compensate a
--------
Lender pursuant to this Section for any increased costs or reductions incurred
more than 6 months prior to the date that such Lender notifies the Borrower of
the Change in Law giving rise to such increased costs or reductions and of such
Lender's intention to claim compensation therefor.
SECTION 2.15. Break Funding Payments.
----------------------
In the event of (a) the payment of any principal of any Eurodollar Loan other
than on the last day of an Interest Period applicable thereto, (b) the
conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto or (c) the failure to borrow, convert, continue or
prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto, then, in any such event, the Borrower shall compensate each
Lender for the loss, cost and expense attributable to such event. In the case
of a Eurodollar Loan, the loss to any Lender attributable to any such event
shall be equal to the excess, if any, of (i) the amount of interest that such
Lender would pay for a deposit equal to the principal amount of such Loan for
the period from the date of such payment, conversion or failure to the last day
of the then current Interest Period for such Loan (or, in the case of a failure
to borrow, convert or continue, the duration of the Interest Period that would
have resulted from such borrowing, conversion or continuation) if the interest
rate payable on such deposit were equal to the Adjusted LIBO Rate for such
Interest Period, over (ii) the amount of interest that such Lender would earn on
such principal amount for such period if such Lender were to invest such
principal amount for such period at the interest rate that would be bid by such
Lender (or an affiliate of such Lender) for dollar deposits from other banks in
the eurodollar market at the commencement of such period. A certificate of any
Lender setting forth any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered by such Lender to the
Borrower (with a copy to the Administrative Agent) and shall constitute prima
-----
facie evidence of the correctness of the amount claimed.
-----
SECTION 2.16. Taxes.
-----
(a) Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if the Borrower shall be
--------
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Administrative Agent or Lender (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent and each
Lender for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent or such Lender, as the case may be, and any penalties,
interest and reasonable expenses arising
51
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or by the Administrative Agent
on its own behalf or on behalf of a Lender, shall constitute prima facie
----- -----
evidence of the correctness of the amount claimed.
(d) As soon as reasonably practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Each Lender that is not a United States Person, as defined in
Section 7701(a)(30) of the Code (a "Non-U.S. Holder"), on or prior to the date
---------------
of its execution and delivery of this Agreement or on the date of the Assignment
and Acceptance pursuant to which it becomes a Lender, as the case may be, and
from time to time thereafter if requested in writing by the Borrower or the
Administrative Agent (but only so long as such Lender remains lawfully able to
do so), shall provide the Borrower and the Administrative Agent with Internal
Revenue Service Form 1001 or 4224, as appropriate, or any successor or other
form prescribed by the Internal Revenue Service, certifying that such Lender is
exempt from or entitled to a reduced rate of United States withholding tax on
payments of interest pursuant to this Agreement or the Notes or, in the case of
any such Lender that is unable to provide an Internal Revenue Service Form 1001
or 4224 and that claims exemption from U.S. Federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of "portfolio
interest," a Form W-8, or any subsequent versions thereof or successors thereto
(and if such Lender delivers a Form W-8, a certificate substantially in the form
of Exhibit N attached hereto). Any Lender that is legally entitled to an
---------
exemption from or reduction of withholding tax which is an Indemnified Tax with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times reasonably requested by
the Borrower or at such times as are otherwise prescribed by applicable law,
such properly completed and executed documentation prescribed by applicable law
as will permit such payments to be made without withholding or subject to
withholding at a reduced rate. Each Lender further agrees to deliver to the
Borrower and the Administrative Agent the documentation referred to in the
preceding sentence on or before the date such documentation expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent such documentation previously delivered to the Borrower, so that in each
case payments will be permitted to be made hereunder without withholding or
subject to withholding at a reduced rate. If any form or document referred to
in this paragraph (e) requires the disclosure of information (other than
information necessary to compute the tax payable or information required by the
relevant taxing authority to secure such exemption or reduction with respect to
withholding tax and that is necessary to secure such exemption from or reduction
of withholding tax) that the Lender reasonably considers to be confidential, the
Lender shall give notice thereof to the Borrower and shall not be obligated to
include in such form or document such confidential information.
52
(f) If a Lender or the Administrative Agent shall become aware that it
is entitled to receive a refund in respect of an Indemnified Tax paid by the
Borrower, which refund in the good faith judgment of such Lender is allocable to
such payment made by the Borrower pursuant to this Section, it shall promptly
notify the Borrower of the availability of such refund and shall, within 30 days
after the receipt of a request by the Borrower, apply for such refund. If any
Lender or the Administrative Agent receives a refund in respect of any
Indemnified Tax paid by the Borrower, or as to which it has been indemnified by
the Borrower, which refund in the good faith judgment of such Lender is
allocable to such payment made pursuant to this Section, it shall promptly
notify the Borrower of such refund and shall, within 20 days of receipt, repay
such refund to the Borrower (together with any interest with respect thereto
received from the relevant taxing authority). In any event, each Lender shall
have the right to arrange its tax affairs as it, in its sole discretion, deems
most advantageous to it and nothing shall require a Lender to disclose its tax
returns or other confidential fiscal or tax information to the Borrower.
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
-----------------------------------------------------------
(a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or under Sections 2.14, 2.15 or
------------- ----
2.16, or otherwise) prior to 1:00 p.m., New York City time, on the date when
----
due, in immediately available funds, without set-off or counterclaim. Subject
to the provisions of the Securities Accounts Agreement, all such payments shall
be made to the Administrative Agent at its offices at 00 Xxxx 00xx Xxxxxx, Xxx
Xxxx, Xxx Xxxx, 00000 except that payments pursuant to Sections 2.14, 2.15, 2.16
------------- ---- ----
and 9.03 shall be made directly to the Persons entitled thereto. The
----
Administrative Agent shall distribute any such payments (including payments
received pursuant to the provisions of the Securities Accounts Agreement)
received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. Except as set forth herein, if any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied, subject to the provisions
of the Securities Accounts Agreement, (i) first, to pay interest and fees then
due hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, to pay
principal then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value) a
participation in the Loans of the other Lenders to the extent necessary so that
the benefit of all such payments shall
53
be shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Loans; provided that (i)
--------
if any such participation is purchased and all or any portion of the payment
giving rise thereto is recovered, such participation shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans to any assignee
or participant, other than to the Borrower or any Subsidiary or other Affiliate
thereof (as to which the provisions of this paragraph shall apply).
(d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the Federal Funds Effective Rate for 3
days and at the Alternate Base Rate thereafter.
(e) If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.05(b) or 2.17(d), then the Administrative Agent may,
--------------- -------
in its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Lender to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders.
----------------------------------------------
(a) If (1) any Lender requests compensation under Section 2.14, (2)
------------
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.16,
------------
or (3) on or after the date of this Agreement any change in any applicable law
or in the interpretation or application thereof shall make it unlawful for any
Lender to make or maintain Eurodollar Loans as contemplated by this Agreement,
then such Lender shall use reasonable efforts to designate a different lending
office for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 2.14 or 2.16, as the case may be,
------------ ----
in the future, (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender and (iii) if
applicable, would render lawful the making of Eurodollar Loans by such Lender as
contemplated by this Agreement.
(b) If (1) any Lender requests compensation under Section 2.14 which
------------
is not being requested by the Lenders generally, (2) the Borrower is required to
pay any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to
54
Section 2.16, (3) on or after the date of this Agreement any change in any
------------
applicable law or in the interpretation or application thereof shall make it
unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by
this Agreement or (4) any Lender becomes a Defaulting Lender, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, so long as no Default shall have occurred and be
continuing, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 9.04), all
-------------
its interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if another
Lender accepts such assignment); provided that (i) the Borrower shall have
--------
received the prior written consent of the Administrative Agent, which consent
shall not unreasonably be withheld or delayed, (ii) such Lender shall have
received payment of an amount equal to the outstanding principal of its Loans,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.14 or payments required to be made pursuant to
------------
Section 2.16, such assignment will result in a reduction in such compensation or
------------
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.
(c) If a Lender changes its applicable lending office (other than
pursuant to paragraph (d) below) and the effect of such change, as of the date
of such change, would be to cause the Borrower to become obligated to pay any
additional amount under Section 2.14 or 2.16, the Borrower shall not be
------------ ----
obligated to pay such additional amount.
(d) If a condition or an event occurs which would, or would upon the
passage of time or giving of notice, result in the payment of any additional
amount to any Lender by the Borrower pursuant to Section 2.14 or 2.16, such
------------ ----
Lender shall promptly notify the Borrower and the Administrative Agent and shall
take such steps as may reasonably be available to it to mitigate the effects of
such condition or event (which shall include efforts to rebook the Loans held by
such Lender at another lending office, or through another branch or an
affiliate, of such Lender); provided that such Lender shall not be required to
--------
take any step that, in its reasonable judgment, would be materially
disadvantageous to its business or operations or would require it to incur
additional costs (unless the Borrower agrees to fund such costs in a manner
satisfactory to such Lender).
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Administrative Agent, the Lead
Agents and the Lenders on the Closing Date and on the date of each Credit
Extension that:
SECTION 3.01. Financial Condition. The Borrower has heretofore furnished
-------------------
to the Lenders its unaudited consolidated balance sheet and statements of
income, stockholders' equity
55
and cash flow as of and for the fiscal quarter ended September 30, 1998, in each
case, certified by a Responsible Officer of the Borrower. Such financial
statements present fairly, in all material respects, the financial position and
results of operations and cash flow of the Borrower and its consolidated
Subsidiaries as of such date and for such period in accordance with GAAP,
subject to year-end adjustments and the absence of footnotes. All material
liabilities of the Borrower on such date are disclosed in such balance sheet.
SECTION 3.02. No Change. Since September 30, 1998, there has been no
---------
development or event and no change which has had or could reasonably be expected
to have a Material Adverse Effect, except as expressly contemplated by the Loan
Documents; provided that an adverse change in sales or prospective sales of
--------
Capacity, whether or not based on changes or perceived changes in external
market conditions (including as a result of increased competition or
introductions or applications of new technology), will not provide a basis for
concluding that any such development, event or change described above has
occurred.
SECTION 3.03. ORGANIZATION; POWERS. The Borrower and each Subsidiary is
--------------------
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and is qualified to do business in each
jurisdiction in which the conduct of its business requires such qualification,
except where the failure to be so qualified could not reasonably be expected to
have a Material Adverse Effect.
SECTION 3.04. AUTHORIZATION; ENFORCEABILITY.
-----------------------------
(a) The Borrower and each Subsidiary has full corporate power and
authority to conduct its business as proposed to be conducted by it in respect
of the System and the System Activities and to execute, deliver and perform each
Loan Document and System Contract (other than the Non-Material System Contracts)
to which it is a party and to take all action as may be necessary to complete
the transactions contemplated hereunder.
(b) The Borrower and each Subsidiary has taken all necessary corporate
action to authorize the Borrowings and other Credit Extensions hereunder by the
Borrower, to grant the Liens provided for in the Security Documents to which it
is a party and to authorize the execution, delivery and performance of this
Agreement and each other Loan Document and System Contract (other than the Non-
Material System Contracts) to which it is a party.
(c) Each of this Agreement and each other Loan Document and System
Contract to which the Borrower or any Subsidiary is a party (other than the Non-
Material Systems Contracts) has been duly executed and delivered by the Borrower
or such Subsidiary, as the case may be, and constitutes a legal, valid and
binding obligation of the Borrower or such Subsidiary, enforceable against the
Borrower or such Subsidiary in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.05. Corporate Structure.
-------------------
56
(a) As of the Closing Date, the only shareholder of the Borrower is
Mid-Atlantic Holdings. As of the Closing Date, the capital structure of the
Borrower and the U.S. Subsidiary is as set forth on Schedule 3.05(a).
----------------
(b) As of the Closing Date, the only subsidiary of the Borrower is set
forth on Schedule 3.05(b), and such subsidiary is a wholly owned direct
----------------
subsidiary of the Borrower. From and after the Closing Date, the only
subsidiaries of the Borrower not listed on Schedule 3.05(b) are those, if any,
----------------
created and capitalized in accordance with and subject to Sections 6.05 and
-------------
6.18.
----
(c) As of the date of execution and delivery of the St. Croix Master
Pledge Agreement, the only shareholder of the St. Croix Affiliate is Global
Network. As of the date of execution and delivery of the St. Croix Master
Pledge Agreement, the capital structure of the St. Croix Affiliate is as set
forth in Schedule 3.05(c).
----------------
SECTION 3.06. Compliance with Law. The Borrower and each Subsidiary is in
-------------------
compliance with all Requirements of Law, except to the extent any non-compliance
could not reasonably be expected to have a Material Adverse Effect.
SECTION 3.07. No Legal Bar. The execution, delivery and performance by the
------------
Borrower and each Subsidiary of each Loan Document and System Contract to which
it is a party and the Borrowings by the Borrower hereunder and the use of the
proceeds thereof and the granting of all Liens under the Security Documents (a)
will not violate or result in a default under (i) any Requirement of Law binding
on such Person or its assets or (ii) any material Contractual Obligation of such
Person, except, in each such case, where such violation or default could not
reasonably be expected to have a Material Adverse Effect and (b) will not result
in the creation or imposition of any Lien on any asset of the Borrower or any
Subsidiary except Permitted Encumbrances.
SECTION 3.08. Governmental Actions. Part 1 of Schedule 3.08 sets forth, to
-------------------- -------------
the best knowledge of the Borrower, all U.S. Landing Licenses that are required
to be obtained by the Borrower, any Subsidiary, the St. Croix Affiliate or the
System Contractors (and, in the case of the St. Croix Governmental Actions that
do not by their terms permit the Borrower or the U.S. Subsidiary to enjoy the
benefits thereof, effectively conveyed or leased to the Borrower or the U.S.
Subsidiary) in connection with the construction, installation, development,
ownership and operation of the System; Part 2 of Schedule 3.08 sets forth, to
-------------
the best knowledge of the Borrower, all other U.S. Governmental Authorizations
that are required to be obtained by the Borrower, any Subsidiary, the St. Croix
Affiliate or the System Contractors (and, in the case of the St. Croix
Governmental Actions that do not by their terms permit the Borrower or the U.S.
Subsidiary to enjoy the benefits thereof, effectively conveyed or leased to the
Borrower or the U.S. Subsidiary) in connection with the construction,
installation, development, ownership and operation of the System. By written
notice to the Administrative Agent, the Borrower shall be permitted to amend and
supplement such Schedule from time to time in connection with any amendment or
supplement to the schedules provided by the System Contractors under the
applicable Supply Contract.
57
SECTION 3.09. Litigation. There are no actions, suits or proceedings by or
----------
before any arbitrator or Governmental Authority pending against or, to the best
knowledge of the Borrower, threatened (a) by or against the Borrower, any
Subsidiary or the System or (b) with respect to any Loan Document, in either
case which could reasonably be expected to have a Material Adverse Effect.
SECTION 3.10. Environmental Matters. No condition or violation of
---------------------
Environmental Laws exists with respect to the System, the Borrower, any
Subsidiary or any of their respective properties or assets owned or operated by
them which in each case could reasonably be expected to have a Material Adverse
Effect. To the best knowledge of the Borrower, no other violation of
Environmental Law exists which could reasonably be expected to have a Material
Adverse Effect.
SECTION 3.11. No Default; Event of Default. Neither the Borrower nor any
----------------------------
Subsidiary is in default under any System Contract as of the Closing Date. As of
any date representations and warranties are made or deemed made under this
Agreement subsequent to the Closing Date, neither the Borrower, nor any
Subsidiary, is in default under any System Contract which could reasonably be
expected to have a Material Adverse Effect. No payment Default or any Event of
Default has occurred and is continuing.
SECTION 3.12. Properties. The Borrower and each Subsidiary has good and
----------
valid title to, valid leasehold interests in or an indefeasible right to use all
its real and personal property material to its business free and clear of all
Liens, except for Permitted Encumbrances and minor defects in title that do not
interfere with its ability to conduct its business as currently conducted or to
utilize such properties for their intended purposes.
SECTION 3.13. Taxes. To the best of the Borrower's knowledge, neither the
-----
Borrower, nor any Subsidiary nor the System is subject to any material tax in
any jurisdiction, except for taxes set forth in Schedule 3.13. The Borrower and
-------------
each Subsidiary has timely filed or caused to be filed all tax returns and
reports required to have been filed by such Person and has paid or caused to be
paid all Taxes shown to be due on such returns except Taxes subject to a
Contest.
SECTION 3.14. Federal Regulations. The Borrower is not engaged nor will it
-------------------
engage in the business of extending credit for the purpose of ``purchasing" or
``carrying'' any ``margin stock" within the respective meanings of each of the
quoted terms under Regulations U and X of the Board of Governors of the Federal
Reserve System as now and from time to time hereafter in effect. No part of the
proceeds of the Loans will be used for "purchasing" or carrying'' any ``margin
stock'' as so defined or for any purpose which violates the provisions of the
Regulations of such Board of Governors.
SECTION 3.15. ERISA. No ERISA Event has occurred or is reasonably expected
-----
to occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to have
a Material Adverse Effect, and no contribution failure has occurred with respect
to any Plan sufficient to give rise to a lien under Section 302(f) of ERISA.
58
SECTION 3.16. Investment Company Act. Neither the Borrower nor any
----------------------
Subsidiary is an "investment company" as defined in, or subject to regulation
under, the Investment Company Act of 1940.
SECTION 3.17. Security Documents. (a) The recordings, filings and other
------------------
actions indicated on Part A Schedule 3.17 are, on and as of the Closing Date,
-------------
all the recordings, filings and other actions necessary and appropriate to
establish, protect and perfect the Administrative Agent's security interest in
the right, title, estate and interest of the Borrower, each Subsidiary and the
Shareholders in and to (a) the Capital Stock of the Borrower and each Subsidiary
and the Collateral in respect of which the Securities Accounts Agreement
purports to grant a security interest to the Secured Parties, in each case,
which can be perfected by the filing of Uniform Commercial Code financing
statements, by possession by the Administrative Agent or by any other means
under any applicable Requirement of Law of the United States, Bermuda, England
and any other jurisdiction in which a Subsidiary shall be organized and existing
on the date this representation and warranty is made or deemed made and (b) the
Collateral (other than the Collateral described in clause (a)) which can be
perfected by the filing of UCC financing statements in the State of New York, by
making appropriate filings in Bermuda or England or by possession by the
Administrative Agent (the Collateral described in clauses (a) and (b) of this
sentence being referred to as the "Perfectible Collateral"). The Security
-----------------------
Documents (together with the filings and other actions referred to above) are
effective to create in favor of the Administrative Agent, valid and enforceable
first priority Liens on, and first priority security interests in, all right,
title, estate and interest of the Shareholders, the Borrower and each Subsidiary
in and to the Perfectible Collateral and valid and enforceable Liens on, and
security interests in, all right, title, estate and interest of the Borrower and
each Subsidiary in and to the other Collateral.
(b) The recordings, filings and other actions indicated on Part B of
Schedule 3.17 are, on and as of the Closing Date, all the recordings, filings
-------------
and other actions necessary and appropriate to establish, protect and perfect
the Master Pledge Trustee's security interest in the right, title, estate and
interest of Global Network in and to the Capital Stock of the St. Croix
Affiliate. Upon the execution and delivery thereof, the St. Croix Master
Pledge Agreement will be effective to create in favor of the Master Pledge
Trustee valid and enforceable first priority Liens on, and first priority
security interests in, all right, title, estate and interest of the Global
Network in and to the Capital Stock of the St. Croix Affiliate.
SECTION 3.18. Chief Executive Office. As of the Closing Date, the "chief
----------------------
executive office," "major executive office" and "place of business" of the
Borrower is in Xxxxxxxx, Bermuda; the "chief executive office," "major executive
office" and "place of business" of the U.S. Subsidiary is in California, United
States; the "chief executive office," "major executive office" and "place of
business" of the U.K. Subsidiary is in Gloustershire, England; and the "chief
executive office," "major executive office" and "place of business" of the St.
Croix Affiliate is in St. Xxxxxx, United States. As of the Closing Date, neither
the Borrower, the U.K. Subsidiary nor the St. Croix Affiliate have any "chief
executive office," "major executive office" or "place of business" (as such
terms are defined in the UCC) in the United States or any state or other
jurisdiction thereof. As of the Closing Date, neither the
59
Borrower, the U.S. Subsidiary nor the St. Croix Affiliate have any "chief
executive office," "major executive office" or "place of business" in England or
other jurisdiction thereof.
SECTION 3.19. Disclosure. The written factual information furnished by (or
----------
based on written information furnished by) the Borrower to the Lenders in
connection with the negotiation of the Loan Documents (excluding any financial
projections and other estimates or views of future circumstances), taken as a
whole, does not contain, as of the Closing Date, any untrue statements of
material fact and does not omit to state, as of the Closing Date, any material
fact necessary in order to make the statements contained therein, in light of
the circumstances under which they were made, not materially misleading (unless
superseded or corrected and disclosed in writing to the Lead Agents prior to the
Closing Date). The costs set forth in the Capital Budget reflect, as of the
Closing Date, the Borrower's best estimates of all costs necessary for the
construction, installation and financing of the System. The projections
delivered by the Borrower to the Lead Agents on the Closing Date in accordance
with Section 4.01(h) have been prepared in good faith and have been based on
---------------
assumptions which were reasonable at the time prepared. The Operating Plan
delivered with the initial Operating Budget has been, and the Operating Budget
for each ensuing Operating Year, as of the date delivered to the Administrative
Agent in accordance with the terms hereof, shall have been, prepared by the
Borrower in good faith and have been based on assumptions which were reasonable
at the time prepared.
SECTION 3.20. Sufficiency of System Contracts. The services to be
-------------------------------
performed and other rights granted pursuant to the System Contracts comprise all
of the material services, materials and property interests required to complete
the System, and the services to be performed and other rights granted pursuant
to the System Contracts, together with services to be performed and rights to be
granted in favor of the Borrower or any Subsidiary pursuant to contracts which
the Borrower believes will, as and when such services and rights will be
required by the Borrower and any Subsidiary, be available on commercially
reasonable terms, comprise all of the material services, materials and property
interests required to perform the System Activities.
SECTION 3.21. Immunity. Neither the Borrower nor any Subsidiary is
--------
entitled to claim for itself, any of its assets or the System immunity from
suit, execution, attachment or other legal process in any proceeding in any
jurisdiction in connection with any of the Loan Documents to which it is a
party.
SECTION 3.22. Export Control. The Borrower and each Subsidiary is in
--------------
compliance with all U.S. export laws and regulations applicable to it, except to
the extent that any non-compliance could not reasonably be expected to have a
Material Adverse Effect.
SECTION 3.23. Foreign Corrupt Practices Act. None of the Borrower, any
-----------------------------
Subsidiary or any of its officers, directors, employees, agents or affiliates,
acting on its behalf, has taken any action in connection with the System or the
System Activities that violates the Foreign Corrupt Practices Act of the United
States, if applicable.
60
SECTION 3.24. Intellectual Property. The Borrower and each Subsidiary owns
---------------------
or is licensed or otherwise has the right to use or obtain (and has maintained
in full force and effect and has not abandoned) all of the trademarks,
copyrights, patents, licenses and other intellectual property rights that are
reasonably necessary for the operation of each of their respective businesses,
without, to the best of the Borrower's knowledge, conflict with the rights of
any other Person and free of Liens (other than Permitted Encumbrances), except
where the failure to have any such rights could not reasonably be expected to
have a Material Adverse Effect.
SECTION 3.25. No Additional Fees. Other than as contemplated in the
------------------
Projections delivered by the Borrower to the Lead Agents on the Closing Date in
accordance with Section 4.01(h) and the Capital Budget, the Borrower has not
---------------
paid nor become obligated to pay any fee or commission to any broker, finder or
intermediary for or on account of arranging the financing of the transactions
contemplated by, or for the legality, validity or enforceability of, the Loan
Documents or the System Contracts.
SECTION 3.26. Year 2000. Any reprogramming required to permit the proper
---------
functioning, in and following the year 2000, of the Borrower's and each
Subsidiary's computer systems and equipment containing embedded microchips
(including systems and equipment supplied by others or with which the Borrower's
or, any Subsidiary's systems interface) which the Borrower, such Subsidiary
possesses as of the date this representation is made or deemed made and the
testing of all such systems and equipment, as so reprogrammed, will be completed
by January 1, 1999. The cost to the Borrower and, its Subsidiaries of such
reprogramming and testing and of the reasonably foreseeable consequences of the
year 2000 to the Borrower and, its Subsidiaries (including, without limitation,
reprogramming errors and the failure of others' systems or equipment) could not
reasonably be expected to result in a Material Adverse Effect. Except for such
of the reprogramming referred to in the preceding sentence as may be necessary,
the computer and management information systems of the Borrower and, its
Subsidiaries are, and, with ordinary course upgrading and maintenance, will
continue to be, sufficient to permit the Borrower to conduct its business
without causing a Material Adverse Effect.
SECTION 3.27. LANDING LICENSE. The Borrower filed an application for the
---------------
U.S. Landing License with the FCC on October 30, 1998 and has provided each of
the Lead Agents with a complete and accurate copy of such application.
ARTICLE IV.
CONDITIONS
----------
SECTION 4.01. Conditions Precedent to the First Loan. The obligations of
--------------------------------------
the Agents and the Lenders hereunder, including the obligation to make the First
Loan, shall be subject to the fulfillment in a manner reasonably satisfactory to
the Lead Agents, or waiver by the Lead Agents, of each of the following
conditions precedent:
(a) Loan Documents. The Administrative Agent shall have received,
--------------
with a counterpart for each Lender, each of the following documents:
61
(i) this Agreement, duly executed and delivered by each of
the parties hereto;
(ii) the Securities Accounts Agreement, duly executed and
delivered by the Borrower, each Subsidiary, the Administrative Agent and
the Securities Intermediary;
(iii) the Shareholder Pledge Agreements, each duly executed and
delivered by Mid-Atlantic Holdings and the Administrative Agent, together
with (A) the stock certificates representing all of the Capital Stock of
the Borrower owned by Mid-Atlantic Holdings and (B) undated stock powers
for such stock certificates representing such Capital Stock, executed in
blank and delivered by a duly authorized officer of Mid-Atlantic Holdings;
(iv) the Borrower Pledge Agreements, each duly executed and
delivered by the Borrower and the Administrative Agent, together with (A)
the stock certificates representing all of the Capital Stock of the U.K.
Subsidiary and (B) undated stock powers for each stock certificate
representing such Capital Stock, executed in blank and delivered by a duly
authorized officer of the Borrower;
(v) the Borrower Security Agreements, each duly executed and
delivered by the Borrower and the Administrative Agent;
(vi) the U.S. Subsidiary Security Agreement, duly executed and
delivered by the U.S. Subsidiary and the Administrative Agent;
(vii) the U.S. Subsidiary Guaranty Agreement, duly executed and
delivered by the U.S. Subsidiary;
(viii) the U.K. Subsidiary Pledge Agreement (New York Law) duly
executed and delivered by the U.K. Subsidiary and the Administrative Agent,
together with (A) the Stock Certificates representing all the Capital Stock
of the U.S. Subsidiary and (B) updated stock powers for each stock
certificate representing such Capital Stock , executed in blank and
delivered by a duly authorized officer of the U.K. Subsidiary.
(ix) the U.K. Subsidiary Security Agreements, each duly
executed and delivered by the U.K. Subsidiary and the Administrative Agent;
(x) the U.K. Subsidiary Guaranty Agreement, duly executed and
delivered by the U.K. Subsidiary; and
(xi) the Mid-Atlantic Holdings Cash Collateral Agreement, duly
executed and delivered by Mid-Atlantic Holdings.
(b) System Contracts. The Administrative Agent shall have received,
----------------
with a counterpart for each Lender, each of the following documents:
62
(i) a true and complete copy of the Alcatel Supply Contract,
duly certified as such by a Responsible Officer of the Borrower as of the
Closing Date and as being in full force and effect;
(ii) a true and complete copy of the Alcatel Guarantee, duly
certified as such by a Responsible Officer of the Borrower as of the
Closing Date and as being in full force and effect;
(iii) the Alcatel Contractor Consent, duly executed and
delivered by the Contractor, the Administrative Agent and the Borrower;
(iv) a true and complete copy of the Marketing Agreement, duly
certified as such by a Responsible Officer of the Borrower as of the
Closing Date and as being in full force and effect;
(v) the Marketing Agent Consent, duly executed and delivered
by the Marketing Agent, the Administrative Agent and the Borrower;
(vi) a true and complete copy of the Financial Services
Agreement, duly certified as such by a Responsible Officer of the Borrower
as of the Closing Date and as being in full force and effect;
(vii) the Financial Services Consent, duly executed and
delivered by GCDC, the Administrative Agent and the Borrower; and
(viii) a true and complete copy of the Intercompany Agreement,
duly certified as such by a Responsible Officer of the Borrower as of the
Closing Date and as being in full force and effect.
(c) Legal Opinions. The Administrative Agent shall have received,
--------------
with a counterpart for each Lender, the following executed legal opinions, each
dated the Closing Date:
(i) the legal opinion of Xxxxxxx, Xxxxxxxx & Xxxxx, Bermuda
counsel to the Borrower and Mid-Atlantic Holdings, substantially in the
form of Exhibit J-1;
-----------
(ii) the legal opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx, special
New York counsel to the Borrower and the U.S. Subsidiary, substantially in
the form of Exhibit J-2;
-----------
(iii) the legal opinion of Xxxxxx and Co., special English
counsel to the U.K. Subsidiary, substantially in the form of Exhibit J-3;
-----------
(iv) the legal opinion of Xxxxx Xxxxx, English counsel to
Alcatel, substantially in the form of Exhibit J-4; and
-----------
63
(v) the legal opinion of Xxxxxx Xxxxxx-Xxxxxxx, French
counsel to Alcatel, substantially in the form of Exhibit J-5; and
-----------
(vi) the legal opinion of Xxxxxxx & Xxxxxxxx LLP, New York
counsel to the Contractor, substantially in the form of Exhibit J-6; and
-----------
(vii) the legal opinion of Xxxxxxx Xxxxxxxx, French counsel to
the Contractor, substantially in the form of Exhibit J-7;
-----------
(d) Independent Engineer's Report. The Administrative Agent shall
-----------------------------
have received, with a copy for each Lender, the final report of the Independent
Engineer, a copy of which is attached as Exhibit K-1, together with a
-----------
certificate from the Independent Engineer in the form of Exhibit K-2.
-----------
(e) Market Consultant's Report. The Administrative Agent shall have
--------------------------
received, with a copy for each Lender, the final report of the Market
Consultant, a copy of which is attached as Exhibit L-1, together with a
-----------
certificate from the Market Consultant in the form of Exhibit L-2.
-----------
(f) Capital Budget. The Administrative Agent shall have received,
--------------
with a copy for each Lender, a true and correct copy of the construction budget
(which sets forth all Capital Costs to be incurred prior to System Final
Completion and which will include, without limitation, line items for the
purchase of Backhaul Capacity, restricted and unrestricted contingency, and
payments to be made under each Supply Contract) and a true and correct copy of a
construction drawdown schedule (including a drawdown schedule with respect to
the Loans) (as amended in accordance with the terms hereof, the "Capital
-------
Budget"), prepared and certified as to such as of the Closing Date by the
------
Borrower, a copy of which is attached as Exhibit M.
---------
(g) Landing Licenses. The Lead Agents shall be reasonably satisfied
----------------
that the Borrower and any Subsidiary will appropriately file for, or will cause
to be filed for, all necessary applications for the issuance of the Landing
Licenses and that such Landing Licenses will be obtained in each case on or
prior to the date indicated on Schedule 4.02(f) as the date by which such
----------------
Landing License is to be obtained.
(h) Projections. The Administrative Agent shall have received, with a
-----------
copy for each Lender, a copy of the Projections certified as of the Closing Date
by a Responsible Officer of the Borrower as being prepared in good faith and
based on reasonable assumptions, a copy of which is attached as Exhibit M.
---------
(i) Security Interests (Recordings and Filings). Each of the
-------------------------------------------
documents and instruments set forth in Schedule 3.17 (i) shall have been
-------------
delivered to the Administrative Agent for recording or filing or (ii) shall have
been recorded or filed in the respective places or offices set forth in Schedule
--------
3.17, and, in each such case, any and all recording and filing fees with respect
----
thereto shall have been paid, and each of the other actions set forth in
Schedule 3.17 shall have been taken.
-------------
64
(j) No Violation of Law. The consummation of the transactions
-------------------
contemplated by the Loan Documents and by the System Contracts shall not violate
any Requirement of Law.
(k) Financial Statements. The Administrative Agent shall have
--------------------
received and the Lead Agents shall be reasonably satisfied with true and correct
copies of (i) the unaudited balance sheet and related financial statements of
the Borrower for the fiscal quarter ended September 30, 1998, certified as such
by a Responsible Officer of the Borrower and (ii) the most recent unaudited
balance sheet and related financial statements of Mid-Atlantic Holdings,
certified as such by a Responsible Officer of Mid-Atlantic Holdings.
(l) Fees. The Administrative Agent and the Lead Agents shall have
----
received all fees and expenses (including counsel and consultant fees and
expenses) due and payable by the Borrower to the Administrative Agent and the
Lead Agents on or prior to the Closing Date.
(m) Agent for Service of Process. The Administrative Agent shall have
----------------------------
received evidence that the Borrower and each other Loan Party that does not have
an office in the United States has irrevocably appointed an agent in New York or
New Jersey for service of process.
(n) Corporate Proceedings of the Borrower. The Administrative Agent
-------------------------------------
shall have received a copy of the resolutions, in form and substance reasonably
satisfactory to the Lead Agents, of the Board of Directors of the Borrower
authorizing (i) the execution, delivery and performance of the Supply Contracts,
this Agreement and the other Loan Documents to which it is a party, (ii) the
Borrowings contemplated hereunder and (iii) the granting by it of the Liens
created pursuant to the Security Documents to which it is a party, certified by
the Secretary or an Assistant Secretary of the Borrower as of the Closing Date,
which certificate shall be in form and substance reasonably satisfactory to the
Lead Agents and shall state that the resolutions thereby certified have not been
amended, modified, revoked or rescinded.
(o) Borrower Incumbency Certificate. The Administrative Agent shall
-------------------------------
have received a certificate of the Borrower, dated the Closing Date, as to the
incumbency and signature of the officers of the Borrower executing any Loan
Document or any Supply Contract, in form and substance reasonably satisfactory
to the Lead Agents, executed by the President or any Vice President and the
Secretary or any Assistant Secretary of the Borrower.
(p) Corporate Proceedings of Mid-Atlantic Holdings. The
----------------------------------------------
Administrative Agent shall have received a copy of the resolutions, in form and
substance reasonably satisfactory to the Lead Agents, of the Board of Directors
of Mid-Atlantic Holdings authorizing (i) the execution, delivery and performance
of the Loan Documents to which Mid-Atlantic Holdings is a party and (ii) the
granting by it of the Liens created pursuant to the Security Documents to which
it is a party, certified by the Secretary or an Assistant Secretary of Mid-
Atlantic Holdings as of the Closing Date, which certificate shall be in form and
substance reasonably satisfactory to Lead Agents and shall state that the
resolutions thereby certified have not been amended, modified, revoked or
rescinded.
65
(q) Shareholder Incumbency Certificates. The Administrative Agent
-----------------------------------
shall have received a certificate of Mid-Atlantic Holdings, dated the Closing
Date, as to the incumbency and signature of the officers of Mid-Atlantic
Holdings executing any Loan Document, in form and substance reasonably
satisfactory to the Lead Agents, executed by the President or any Vice President
and the Secretary or any Assistant Secretary of Mid-Atlantic Holdings.
(r) Corporate Proceedings of Subsidiaries. The Administrative Agent
-------------------------------------
shall have received a copy of the resolutions, in form and substance reasonably
satisfactory to the Lead Agents, of the Board of Directors of each Subsidiary
authorizing (i) the execution, delivery and performance of the Supply Contracts
and the Loan Documents to which such Subsidiary is a party and (ii) the granting
by it of the Liens created pursuant to the Security Documents to which such
Subsidiary is a party, certified by a Responsible Officer of such Subsidiary as
of the Closing Date, which certificate shall be in form and substance reasonably
satisfactory to the Lead Agents and shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded.
(s) Subsidiary Incumbency Certificates. The Administrative Agent
----------------------------------
shall have received a certificate of each Subsidiary, dated the Closing Date, as
to the incumbency and signature of the officers of such Subsidiary executing any
Loan Document or any Supply Contract, in form and substance reasonably
satisfactory to the Lead Agents, executed by two Responsible Officers of such
Subsidiary.
(t) Corporate Documents. The Administrative Agent shall have received
-------------------
true and complete copies of the certificate of incorporation and by-laws (or
such other organizational and governing documents) of each of Mid-Atlantic
Holdings, the Borrower and the U.S. Subsidiary, certified as of the Closing Date
as complete and correct copies thereof by a Responsible Officer of such Person.
(u) Closing Date Certificate. The Administrative Agent shall have
------------------------
received the Closing Date Certificate in the form of Exhibit G, dated the
---------
Closing Date and duly executed by a Responsible Officer of the Borrower, stating
that (a) no default in any material respect as to the Borrower or any Subsidiary
has occurred and is continuing under any System Contract and (b) to the best of
the Borrower's knowledge, no default in any material respect as to any other
party thereto has occurred and is continuing under any System Contract.
(v) Representations and Warranties. All representations and
------------------------------
warranties made by the Borrower and each other Loan Party in any Loan Document
shall be true and correct in all material respects when made (unless any such
representation or warranty relates solely to an earlier date, in which case it
shall have been true and correct in all material respects as of such earlier
date).
(w) No Default or Event of Default. No Default or Event of Default
------------------------------
shall have occurred and be continuing as of the Closing Date.
66
(x) Satisfactory Documentation. All documentation received by the
--------------------------
Administrative Agent or the Lead Agents shall be reasonably satisfactory to the
Lead Agents.
(y) Credit Extension Request. The Administrative Agent shall have
------------------------
received a properly completed Credit Extension Request in accordance with
Section 2.03 executed by a Responsible Officer of the Borrower.
------------
(z) Credit Extension Certificate. The Administrative Agent shall have
----------------------------
received a properly completed Credit Extension Certificate in accordance with
Section 2.03, dated as of the applicable Credit Extension Date, executed by a
------------
Responsible Officer of the Borrower.
SECTION 4.02. Conditions Precedent to Subsequent Credit Extensions.
----------------------------------------------------
The making of any Credit Extension after the First Loan shall be subject to the
fulfillment, or waiver by the Majority Lenders, of each of the following
conditions precedent:
(a) Representations and Warranties. All representations and
------------------------------
warranties made by the Borrower and each other Loan Party in any Loan Document
shall be true and correct in all material respects when made (unless any such
representation or warranty relates solely to an earlier date, in which case it
shall have been true and correct in all material respects as of such earlier
date).
(b) No Payment Default or Event of Default. No payment Default or
--------------------------------------
Event of Default shall have occurred and be continuing on such date, and no
Event of Loss shall have occurred and be continuing on such date (i) which Event
of Loss could reasonably be expected to have a Material Adverse Effect or (ii)
with respect to which Event of Loss the cost to repair is in excess of
$5,000,000 unless (A) the Borrower is able to certify (as confirmed by the
Independent Engineer) in its reasonable judgment that the Commercial Operation
Date can occur on or prior to the Guaranteed Completion Date with the Loans,
equity and insurance payments available to it or (B) the risk of loss with
respect to that portion of the System giving rise to the Event of Loss is borne
by a System Contractor under a Supply Contract.
(c) No Change in Law. No change shall have occurred after the Closing
----------------
Date in any applicable law that would make any Lender's participation in the
transactions contemplated by the Loan Documents illegal, provided that (1) the
--------
non-satisfaction of this condition precedent shall, in the case of a Credit
Extension consisting of a Borrowing, permit only the Lender affected to fail to
fund its portion of the Loans then being requested and (2) this condition
precedent shall not apply in the case of any other Credit Extension.
(d) No Force Majeure. No event of force majeure (as such term is
----------------
defined in the applicable System Contract) shall exist which at such time
permits any party (other than the Borrower) to any System Contract (other than
any Capacity Sales Agreement and any Non-Material System Contract) to terminate
such System Contract.
(e) Governmental Actions (other than Landing Licenses). Unless such
--------------------------------------------------
Credit Extension consists solely of Working Capital Loans made after the
Commercial Operation Date,
67
(i) the Administrative Agent shall have received a certificate of a Responsible
Officer of the Borrower stating that each Governmental Action (other than
Landing Licenses) set forth in Schedule 3.08 which is required in accordance
-------------
with such Schedule (as such Schedule may be amended or supplemented in
accordance with Section 3.08) to be obtained (and, in the case of St. Croix
------------
Governmental Actions that do not by their terms permit the Borrower or the U.S.
Subsidiary to enjoy the benefits thereof, effectively conveyed or leased to the
Borrower or the U.S. Subsidiary by the St. Croix Affiliate, as applicable) on or
prior to the date of such Credit Extension shall have been duly obtained (and,
in the case of St. Croix Governmental Actions that do not by their terms permit
the Borrower or the U.S. Subsidiary to enjoy the benefits thereof, effectively
conveyed or leased to the Borrower or the U.S. Subsidiary by the St. Croix
Affiliate, as applicable), except for those Governmental Actions specifically
described in such certificate (the "Delinquent Governmental Actions") which the
--------------------------------
Borrower, a Subsidiary, the St. Croix Affiliate or a System Contractor failed to
obtain (or, in the case of St. Croix Governmental Actions that do not by their
terms permit the Borrower or the U.S. Subsidiary to enjoy the benefits thereof,
the St. Croix Affiliate failed to effectively convey or lease to the Borrower or
the U.S. Subsidiary, as applicable) by the date of such Credit Extension,
provided that such failure on the date of such Credit Extension could not
--------
reasonably be expected to have a Material Adverse Effect and (ii) nothing shall
have come to the attention of the Administrative Agent or the Borrower (and the
Borrower shall so certify to such effect) indicating that the St. Croix Corridor
License will not be obtained or will not either by its terms permit the Borrower
or the U.S. Subsidiary to enjoy the benefits thereof or be effectively conveyed
or leased by the St. Croix Affiliate to the Borrower or the U.S. Subsidiary by
the date set forth in Schedule 3.08, unless, based upon the date that the St.
-------------
Croix Corridor License is then anticipated to be obtained or, if the St. Croix
Corridor License does not by its terms permit the Borrower or the U.S.
Subsidiary to enjoy the benefits thereof, the date on which the St. Croix
Affiliate will be able to effectively convey or lease the St. Croix Corridor
License to the Borrower or the U.S. Subsidiary, such delay would not, in the
opinion of the Lead Agents, reasonably be expected to have a Material Adverse
Effect.
(f) Landing Licenses. Unless such Credit Extension consists solely of
----------------
Working Capital Loans made after the Commercial Operation Date, the
Administrative Agent shall have received a certificate of a Responsible Officer
of the Borrower stating that each Milestone set forth in Schedule 4.02(f) which
----------------
is required in accordance with such Schedule to have been satisfied on or prior
to the date of such Credit Extension shall have been duly satisfied or, with
respect to any such Milestone which has not been so satisfied by such date, such
certificate shall set forth the details associated with any such delay. If any
Milestone with respect to a Landing License shall not have been satisfied by the
date associated with such Milestone set forth on Schedule 4.02(f), then the
----------------
Lenders shall not be required to make any Credit Extension until such Milestone
has been satisfied or the Majority Lenders otherwise agree. Once issued and
"final," each Landing License shall be in full force and effect and shall not be
subject to any appeal or contest in respect of which there is a material risk
that such Landing License will be revoked.
(g) Credit Extension Request. The Administrative Agent shall have
------------------------
received a properly completed Credit Extension Request in accordance with
Section 2.03 executed by a
------------
68
Responsible Officer of the Borrower, which Credit Extension Request shall, if it
is being requested in respect of payments due under a Supply Contract, be
accompanied by a properly completed Construction Progress Certificate, executed
by a Responsible Officer of the applicable System Contractor and countersigned
by a Responsible Officer of the Borrower and the Independent Engineer.
(h) Credit Extension Certificate. The Administrative Agent shall have
----------------------------
received a properly completed Credit Extension Certificate in accordance with
Section 2.03, dated as of the applicable Credit Extension Date, executed by a
------------
Responsible Officer of the Borrower.
(i) Special Credit Extension Requirements. The requested Credit
--------------------------------------
Extensions shall, to the extent applicable, be in compliance with the provisions
of Section 2.04.
------------
(j) Insurance. With respect to the first Credit Extension made more
---------
than 10 days after the Closing Date, the Administrative Agent shall have
received, with a copy for each Lender, a certificate of the Insurance
Consultant, in form and substance reasonably satisfactory to the Lead Agents,
stating that all insurance policies required to be maintained by the Borrower
and each Subsidiary on the date of such certificate pursuant to this Agreement
have been obtained and are in full force and effect, name the Administrative
Agent or its designee as loss payee and additional insured, as appropriate, and
are not subject to cancellation without prior notice.
(k) First Permitted Upgrade and Backhaul Borrowing. In the case of
----------------------------------------------
Credit Extensions consisting of Tranche A-2 Term Loans made (i) for the purpose
of funding the Upgrade Loan Proceeds Sub-Account the Borrower (A) shall have
made the election and directed the Contractor to construct the First Permitted
Upgrade under the Alcatel Supply Contract or (B) shall have been required to
request such Credit Extension pursuant to Section 2.04(c) or (ii) for the
---------------
purpose of funding the Backhaul Account, (1) the Borrower shall not have
commenced the First Permitted Upgrade and shall not then be required to effect
the First Permitted Upgrade pursuant to Section 5.29 and (2) the Borrower shall
------------
have demonstrated to the satisfaction of the Lead Agents that the amount of
Committed Capacity Sales Revenue will exceed System Capacity sales revenue
projected, in the base case Projections, to be received on or prior to the First
Permitted Upgrade Payment Date.
(l) Required Equity Contribution. With respect to the second Credit
----------------------------
Extension Request consisting of Loans, the Borrower shall have certified that
the entire Required Equity Contribution shall have been made by or on behalf of
Mid-Atlantic Holdings to the Borrower. Such certification shall indicate that
the proceeds thereof have been used to finance System Activities in accordance
with the Capital Budget or otherwise in a manner satisfactory to the Majority
Lenders. The Lead Agents may request and the Borrower shall provide, if so
requested, evidence that reasonably demonstrates that such proceeds were used to
finance System Activities in accordance with the Capital Budget.
(m) Tyco Supply Contract and St. Croix Contracts. With respect to the
--------------------------------------------
second Credit Extension consisting of the Loans, the Borrower shall have
delivered to the Lenders:
69
(i) copies of duly executed counterparts of the Tyco Supply
Contract, the Tyco Guarantee and the St. Croix Contracts, which documents
shall be in form and substance reasonably satisfactory to the Lead Agents,
together with (1) duly executed originals of the Contractor Consents with
respect thereto, which Contractor Consents shall be in form and substance
reasonably satisfactory to the Lead Agents and (2) opinions of such counsel
to any party to the foregoing documents as the Lead Agents may reasonably
request in form and substance reasonably satisfactory to the Lead Agents
(in the case of the Tyco Supply Contract and the Tyco Guarantee,
substantially in the form of Exhibit J-7);
-----------
(ii) a certificate of a Responsible Officer of the Borrower
stating that (A) the Tyco Supply Contract, the Tyco Guarantee and the St.
Croix Contracts, if performed by the parties thereto in accordance with the
terms and conditions thereof, will appropriately integrate with the Alcatel
Supply Contract and will provide for the completion of the System landing
stations by the dates specified therefor in the construction plan referred
to in the report prepared by the Independent Engineer and within the
amounts budgeted therefor in the Capital Budget (in each case without any
extension of the then applicable Scheduled RFS Date under the Alcatel
Supply Contract and without otherwise giving rise to the Contractor's right
to demand an Alcatel Contract Variation with respect to the Alcatel
Contract Price or otherwise) and stating that there is no known reason to
believe that the parties thereto will be unable to perform the Tyco Supply
Contract and the St. Croix Contracts in accordance with their respective
terms and (B) the St. Croix Contracts provide the Borrower (or its
Subsidiaries) with the unencumbered right (subject only to Permitted
Encumbrances) to use and occupy the St. Croix landing station and to
utilize the associated water corridor in connection with the System as
contemplated hereby;
(iii) a report of the Independent Engineer which confirms the
conclusions contained in the certificate referred to in clause (ii) above
(such report to be in form and substance reasonably satisfactory to the
Lead Agents); and
(iv) copies of duly executed counterparts of a legally
enforceable undertaking, in form and substance reasonably satisfactory to
the Lead Agents, of Global Crossing to contribute equity to the Borrower to
enable the Borrower to pay the costs of completing the St. Croix landing
station in the event that (a) the St. Croix landing station is not
completed as part of the system being constructed by Pan American Crossing
and TSSL pursuant to a Project Development and Supply Contract between them
dated as of July 21, 1998 by the date specified in the construction plan
referred to in the Independent Engineer's Report, (b) the costs of
completing the St. Croix landing station exceed the amount budgeted
therefor (including such portion of the then available Unrestricted
Contingency as is not allocated to the First Permitted Upgrade) in the
Capital Budget and (c) there are insufficient offsetting savings in other
items included in the Capital Budget that could be applied to pay the costs
of completing the St. Croix landing station.
70
(n) Corporate Proceedings of the St. Croix Affiliate and Global
-----------------------------------------------------------
Network. With respect to the second Credit Extension consisting of the Loans,
-------
the Administrative Agent shall have received a copy of the resolutions, in form
and substance reasonably satisfactory to the Lead Agents, of the Board of
Directors of the St. Croix Affiliate and Global Network authorizing (i) the
execution, delivery and performance of the St. Croix Contracts and (ii) the
granting by Global Network of the Liens created pursuant to the St. Croix Master
Pledge Agreement, certified by a Responsible Officer of the St. Croix Affiliate
or Global Network, as applicable, as of the date of such second Credit
Extension, which certificates shall be in form and substance reasonably
satisfactory to the Lead Agents and shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded.
(o) St. Croix Affiliate and Global Network Incumbency Certificates.
--------------------------------------------------------------
With respect to the second Credit Extension consisting of the Loans, the
Administrative Agent shall have received a certificate of the St. Croix
Affiliate and Global Network, dated the date of such second Credit Extension, as
to the incumbency and signature of the officers of the St. Croix Affiliate or
Global Network, as applicable, executing any St. Croix Contract, in form and
substance reasonably satisfactory to the Lead Agents, executed by at least two
Responsible Officers of the St. Croix Affiliate and Global Network, as
applicable.
(p) Corporate Documents. With respect to the second Credit Extension
-------------------
consisting of the Loans, the Administrative Agent shall have received true and
complete copies of the certificate of incorporation and by-laws (or such other
organizational and governing documents) of the St. Croix Affiliate and Global
Network, certified as of the date of such second Credit Extension as complete
and correct copies thereof by a Responsible Officer of such Person. Such
organization and governing documents of the St. Croix Affiliate shall, among
other things, limit the business of the St. Croix Affiliate to the performance
of its obligations under the St. Croix Contracts and shall not permit the
incurrence of Indebtedness or Liens.
(q) Atlantic Crossing Co-Location Agreement. With respect to the
---------------------------------------
second Credit Extension consisting of the Loans, the Borrower shall have
delivered to the Lenders (i) a duly executed original of the AC-1 Co-Location
Agreement, (ii) an assignment agreement between the Borrower and the
Administrative Agent pursuant to which the Borrower will assign the AC-1 Co-
Location Agreement to the Administrative Agent for the benefit of the Secured
Parties, (iii) the AC-1 Consent and evidence of the consent of all other
relevant parties with respect thereto and (iv) opinions of counsel to Atlantic
Crossing and, to the extent requested by the Lead Agents, the other parties to
the foregoing documents, all of such documents and opinions to be in form and
substance reasonably satisfactory to the Lead Agents.
ARTICLE V.
AFFIRMATIVE COVENANTS
---------------------
Until the Commitments have expired or been terminated and the principal of
and interest on each Loan and all fees and other obligations payable hereunder
and under the Loan Documents shall have been paid in full, the Borrower
covenants and agrees with the Administrative Agent, the Lead Agents and the
Lenders that:
71
SECTION 5.01. Financial Statements and Other Information. The Borrower
------------------------------------------
shall deliver to the Administrative Agent, with a copy for each Lender, the
following:
(a) within 90 days after the end of each fiscal year of the Borrower
commencing with the 1998 fiscal year, its audited consolidated balance sheet and
related statements of operations, stockholders' equity and cash flows as of the
end of and for such year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on by independent public
accountants of recognized national standing (without qualification or exception
as to the scope of such audit) to the effect that such consolidated financial
statements present fairly in all material respects the financial condition and
results of operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower (commencing with the fiscal quarter
ending March 31, 1999), its consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows as of the end of and for such
fiscal quarter and the then elapsed portion of the fiscal year, setting forth in
each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous
fiscal year, all certified by a Responsible Officer of the Borrower as
presenting fairly in all material respects the financial condition and results
of operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Responsible Officer of the Borrower
certifying to such officer's knowledge whether a payment Default or Event of
Default has occurred and is continuing and, if a payment Default or Event of
Default has occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto;
(d) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm, if available from such
accounting firm, that reported on such financial statements (which certificate
may be limited to accounting matters and may disclaim responsibility for legal
interpretations) stating whether they obtained knowledge during the course of
their examination of such financial statements of any Default (which certificate
may be limited to the extent permitted by accounting rules or guidelines); and
(e) such other information in respect of the conditions or operations,
financial or otherwise, of the Borrower or any Subsidiary as the Administrative
Agent may from time to time reasonably request.
SECTION 5.02. Reports. (a) The Borrower shall deliver to the
-------
Administrative Agent, with a copy for each Lender, within 20 days after the end
of each calendar quarter (commencing with the calendar quarter ending on
September 30, 1998) a report which sets forth the aggregate sales of Capacity as
at the end of such quarter, the amount of Capacity remaining to be sold, any
terminations of sales of Capacity during such quarter, the purchase price
therefor
72
and the date such payments shall become (or became) due. The Borrower shall have
no obligation to provide copies or otherwise disclose the contents of individual
Capacity Sales Agreements to any party hereto other than the Lead Agents, who
shall keep such copies and contents strictly confidential and, subject to the
following sentence, shall not disclose such copies or contents to any other
party. If a Default, Event of Default or Designated Event shall have occurred
and be continuing, the Lead Agents shall be permitted to disclose the contents
of individual Capacity Sales Agreements to the Lenders and/or make copies of
individual Capacity Sales Agreements for the Lenders, provided that such
--------
contents shall be subject to the confidentiality undertakings set forth in
Section 9.14, shall always be deemed to be clearly marked as confidential and,
------------
notwithstanding clause (d) of Section 9.14, shall not be disclosed to any party
------------
to this Agreement except in accordance with this sentence and the other
provisions of Section 9.14.
------------
(b) The Borrower shall (i) deliver to the Administrative Agent,
promptly after the Borrower's receipt thereof, such other reports (excluding
ordinary correspondence) regarding the System, the Borrower or any Subsidiary as
any System Contractor, the Operator, the System Manager or the Marketing Agent
is required to provide to the Borrower under any System Contract, (ii) deliver
to the Administrative Agent promptly upon receipt or transmission copies of all
amendments, material waivers, written consents and other modifications
(including all material Contract Variations) under any System Contract, other
than as to any Capacity Sales Agreement or any Non-Material System Contract
(other than the Intercompany Agreement), and (iii) use reasonable efforts to
deliver to the Administrative Agent in advance of execution, drafts of
amendments to the Supply Contracts, the OA&M Agreement, the Marketing Agreement
and the Supply Contract Guarantees, unless such amendment is, in accordance with
the terms hereof, permitted to be made without the consent of any party hereto,
in which case the Borrower shall not be required to deliver drafts of such
amendment to the Administrative Agent prior to the execution thereof.
(c) The Borrower shall deliver to the Administrative Agent, within 20
days after the end of each calendar quarter occurring after the Commercial
Operation Date, a certificate of a Responsible Officer of the Borrower setting
forth reasonably detailed calculations demonstrating the Borrower's compliance
with Section 6.24; provided that if the Initial Principal Payment Date occurs
------------ --------
less than 6 months after the Commercial Operation Date, the Borrower shall not
be required to demonstrate compliance with the Interest Coverage Ratio
requirement set forth in Section 6.24(b) as of the Initial Principal Payment
---------------
Date.
(d) The Borrower shall assist and cooperate with the Independent
Engineer in providing the Lenders with such reports as the Lenders through the
Administrative Agent shall reasonably request of the Independent Engineer
(including a monthly construction progress report).
(e) The Borrower shall deliver to the Administrative Agent, with a
copy for each Lender, within 20 days after the end of each calendar quarter
(commencing with the calendar quarter ending on December 31, 1998) a comparison
of the then current Capital Budget and then current Operating Budget to the
actual costs and expenditures during such quarter.
73
SECTION 5.03. Payment of Obligations. The Borrower shall, and shall cause
----------------------
each Subsidiary to, pay at or before maturity or before they become delinquent,
as the case may be, all its material obligations of whatever nature, unless the
amount or validity thereof is subject to a Contest.
SECTION 5.04. Conduct of Business; System Completion. The Borrower and
--------------------------------------
each Subsidiary shall engage solely in System Activities and activities
incidental thereto. The Borrower and, if any Subsidiary shall become a party to
any Supply Contract (whether pursuant to a supplement thereto or otherwise),
such Subsidiary, shall diligently enforce all of its rights under such Supply
Contract and the related Supply Contract Guarantee and shall cooperate with, and
take all reasonable action that it can to assist, the applicable System
Contractor to complete the System in accordance with the terms of such Supply
Contract. The Borrower shall, and shall cause each Subsidiary to, enforce all of
its rights under, any leases or subleases in respect of real property on which
any landing station comprising part of the System will be situated.
SECTION 5.05. Existence. The Borrower shall, and shall cause each
---------
Subsidiary to, do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its legal existence and take all reasonable
action to maintain all rights, privileges and franchises material, necessary or
desirable in the normal conduct of its business except those as to which the
failure to maintain such rights, privileges and franchises could not reasonably
be expected to have a Material Adverse Effect; provided that the foregoing shall
` --------
not prohibit any merger, consolidation, liquidation or dissolution permitted
under Section 6.03.
------------
SECTION 5.06. Compliance with Laws. The Borrower shall, and shall cause
--------------------
each Subsidiary to, comply in all material respects with all Requirements of Law
applicable to it or its property, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
SECTION 5.07. Performance of Agreements. The Borrower shall, and shall
-------------------------
cause each Subsidiary to, observe the covenants and agreements of the Borrower
and such Subsidiary contained in the System Contracts except where the failure
to so observe such covenants and agreements could not reasonably be expected to
have a Material Adverse Effect.
SECTION 5.08. Taxes and Claims. (a) The Borrower shall, and shall cause
----------------
each Subsidiary to, pay and discharge all Taxes lawfully imposed on it or on its
income or profits or on any of its property prior to the date on which penalties
attach thereto unless such Tax is subject to a Contest.
(b) The Borrower shall use reasonable efforts to maintain and keep in
full force and effect all clearance rulings, decrees or similar items necessary
to continue the Borrower's exemption from the impositions of any Tax or similar
charge (other than de minimis Taxes or Taxes and other charges set forth on
-- -------
Schedule 3.13) under the laws of Bermuda on the Borrower and its assets and
-------------
revenues.
SECTION 5.09. Notices. The Borrower shall, promptly after a Responsible
-------
Officer of the Borrower has knowledge thereof, give written notice to the
Administrative Agent of (a) the
74
occurrence of a Default or Event of Default (b) any default under any
Contractual Obligation of the Borrower or any Subsidiary that could reasonably
be expected to have a Material Adverse Effect, (c) any litigation or similar
proceeding affecting the Borrower, any Subsidiary or the System which, if
adversely determined, could reasonably be expected to have a Material Adverse
Effect, (d) the occurrence of any ERISA Event that alone or together with any
other ERISA Events that have occurred, could reasonably be expected to result in
liability in an aggregate amount in excess of $5,000,000, (e) the execution of
any Additional Contract (together with, in the case of Additional Material
Contracts, a copy thereof), (f) any material event constituting force majeure
----- -------
under any Supply Contract or any other material delay in the construction of the
System, (g) any loss or damage to the System in excess of $5,000,000 (whether or
not insured), (h) the cancellation or revocation of any material Governmental
Action or insurance maintained by the Borrower, (i) any Lien (other than
Permitted Encumbrances) against any collateral security or the System and (j)
any other development that has resulted in, or could reasonably be expected to
result in, a Material Adverse Effect.
SECTION 5.10. Insurance. The Borrower shall at all times carry and
---------
maintain or cause to be carried and maintained insurance satisfying the
provisions set forth in Schedule 5.10. Upon the request of the Administrative
-------------
Agent, the Borrower shall provide the Administrative Agent with full information
regarding the insurance then carried, or caused to be carried, by the Borrower.
SECTION 5.11. Fiscal Year. The fiscal year of the Borrower and the
-----------
Subsidiaries shall be the 12-month period ending on December 31 of each year.
SECTION 5.12. Use of Proceeds. The proceeds of the First Loan shall be
---------------
used to pay (i) the fees and expenses payable to the Co-Arrangers, the Agents
and the Lenders in connection with the transactions contemplated hereby, (ii)
the fee payable to GCDC pursuant to the Financial Services Agreement and (iii)
the fees and expenses of counsel and consultants to the Co-Arrangers, the
Agents, the Lenders and the Borrower in connection with the transactions
contemplated hereby on the Closing Date. The proceeds of the Term Loans and,
prior to the Commercial Operation Date, the Working Capital Loans shall be used
to finance System Activities in accordance with the Capital Budget and to pay
fees and expenses directly related thereto; provided that, notwithstanding the
--------
foregoing, the proceeds of the Tranche A-2 Term Loans and, prior to the
Commercial Operation Date, the Working Capital Loans shall be used solely to pay
Capital Costs in respect of the First Permitted Upgrade and to pay for the
purchase of Backhaul Capacity by the Borrower and its Subsidiaries, in each such
case as more particularly described in Section 2.04(c) (provided, however, that
--------------- -------- -------
following such time, if ever, as the Borrower obtains a fully executed amendment
to the Alcatel Supply Contract that reduces the amount payable thereunder by the
Borrower in respect of the First Permitted Upgrade (such reduction, the "Cost
-----
Savings"), the Borrower and the Lenders shall amend this Agreement so as to
-------
increase the Unrestricted Contingency by an amount equal to such Cost Savings
(up to a maximum of $5,000,000) and to permit the Borrower to utilize the Cost
Savings portion (up to a maximum of $5,000,000) of the Tranche A-2 Term Loan
Commitment for any permitted use of such Unrestricted Contingency). The proceeds
of the Working Capital Loans shall, on and after the Commercial Operation Date,
be used for working capital purposes. The proceeds of the
75
Loans will not in any event be used for payments of dividends or interest on any
securities (other than in respect of interest on the Loans during construction
included in the Capital Budget or as expressly permitted by the terms hereof or
of the Securities Accounts Agreement).
SECTION 5.13. Environmental Matters. The Borrower shall, and shall cause
---------------------
each Subsidiary to, comply with any and all applicable Environmental Laws,
except where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect.
SECTION 5.14. Operating Budgets; Operating Plans. (a) At least 30 days
----------------------------------
prior to the Commercial Operation Date, and after prior review by, and the
approval of, the Lead Agents (who shall be permitted to consult with the
Independent Engineer and whose approval shall not be unreasonably withheld), the
Borrower will adopt (i) an operating budget detailing anticipated OA&M Expenses
(an "Operating Budget") for the initial Operating Year and (ii) an operating
----------------
plan updating the Projections (the "Operating Plan") for the period from the
----------------
first day of the initial Operating Year through the Maturity Date which shall
set forth the anticipated OA&M Expenses and revenues (net of marketing
commissions), by Operating Year.
(b) At least 30 days prior to the commencement of each subsequent
Operating Year, and after prior review by, and the approval of, the Lead Agents
(who shall be permitted to consult with the Independent Engineer and whose
approval shall not be unreasonably withheld), the Borrower will adopt an
Operating Budget for such Operating Year; provided that any proposed Operating
--------
Budget shall be deemed to be approved by the Lead Agents as long as the OA&M
Expenses set forth in such proposed budget are not greater than 115% of the OA&M
Expenses in respect of such Operating Year set forth in the Operating Plan
approved pursuant to Section 5.14(a).
---------------
(c) The Borrower shall, simultaneously with the delivery of each
Operating Budget (other than the initial Operating Budget), deliver to the
Administrative Agent (for informational purposes only), an update of the
Operating Plan.
(d) The Borrower shall deliver copies of the Operating Budgets for
each such Operating Year promptly to the Administrative Agent.
SECTION 5.15. Governmental Actions. The Borrower shall (a) promptly make,
--------------------
or cause to be made, all filings for all Governmental Actions required in
connection with the construction, installation or operation of the System as
soon as reasonably possible and in accordance with the Alcatel Plan of Work and
the Tyco Plan of Work (and, in any event, in time to comply with the dates for
procurement of Governmental Actions set forth in Schedule 3.08), (b) assist the
--------------
System Contractors where necessary or appropriate in all follow-up necessary to
obtain on a timely basis all such Governmental Actions, (c) at the reasonable
request of the Administrative Agent, meet and confer with, and use reasonable
efforts to cause the System Contractors to meet and confer with, representatives
of the Administrative Agent with respect to the status of Governmental Actions
required in connection with the construction, installation or operation of the
System and (d) from and after the Actual Date of Commercial Operation, maintain
(or cause the Operator or a Subsidiary to maintain) in full force and effect all
material Governmental Actions as are at the time necessary in order to operate
and maintain the System,
76
except where the failure to file or maintain such Governmental Actions could not
reasonably be expected to have a Material Adverse Effect.
SECTION 5.16. Cooperation with Independent Engineer. The Borrower shall,
-------------------------------------
and shall cause each Subsidiary to, keep the Independent Engineer fully informed
on a timely basis with respect to the design of and other material matters
relating to, the System (including, without limitation, the integration of the
cable, the landing stations and the other parts thereof), and shall meet (and,
to the extent within its control, cause the System Contractors to meet) the
Independent Engineer at reasonable times and upon reasonable notice to discuss
any and all of the foregoing.
SECTION 5.17. Spare Parts. The Borrower shall, on and after the Actual
-----------
Date of Commercial Operation, maintain, or cause the Operator to maintain, spare
parts with respect to the System as are customary for the submarine fiber-optic
cable industry.
SECTION 5.18. Interest Rate Protection. The Borrower shall, within 3
------------------------
months after the Closing Date, enter into Hedging Agreements with one or more
Lenders or Affiliates thereof with respect to a percentage of the aggregate
amount of all Term Loan Commitments to be agreed upon by the Borrower and the
Lead Agents for a period to be agreed upon by the Borrower and the Lead Agents,
provided, however, that if the Borrower and the Lead Agents have not agreed on
-------- -------
the foregoing matters by the end of such 3 month period the percentage of the
aggregate amount of Term Loan Commitment to be hedged shall be at least 50%.
SECTION 5.19. Maintenance of Process Agent. The Borrower shall, and shall
----------------------------
cause each of the Loan Parties that does not maintain an office in New York or
New Jersey to maintain in New York or New Jersey a Person acting as agent to
receive on its behalf service of process.
SECTION 5.20. System Operation and Maintenance. The Borrower shall, and
--------------------------------
shall cause each Subsidiary to, from and after the Actual Date of Commercial
Operation, cause the System to be operated and maintained in an efficient and
business-like manner in accordance with the terms of the System Contracts.
SECTION 5.21. Event of Loss. If an Event of Loss shall occur and no Event
-------------
of Default shall have occurred and be continuing and (a) in the Independent
Engineer's reasonable opinion it is technically feasible to restore, rebuild or
replace the affected portion of the System within 1 year, (b) in the Lead
Agents' reasonable opinion there are or will be sufficient funds available to
the Borrower (including from the proceeds of insurance) to restore, rebuild or
replace the affected portion of the System so that the System will be able to
operate on a commercially feasible basis (and in any event on a basis sufficient
to pay the Loans and all other obligations owing to the Lenders), and (c) in the
Independent Engineer's reasonable opinion, it is reasonably likely that the
Borrower and the Subsidiaries will have as and when needed all rights of way and
permits necessary to restore, rebuild or replace the affected portion of the
System, then the Borrower, at its sole cost and expense, shall restore, rebuild
or replace the affected portion of the System.
77
SECTION 5.22. Books and Records; Inspection Rights. The Borrower shall,
------------------------------------
and shall cause each Subsidiary to, keep proper books of record and account in
which full, true and correct entries are made of all dealings and transactions
in relation to its business and activities. The Borrower shall, and shall cause
each Subsidiary to, permit any representative of the Lenders designated by the
Administrative Agent, upon reasonable prior notice, to visit and inspect its
properties, to examine and make copies from its books and records (which shall
not include the right to examine or make copies of the Capacity Sales
Agreements, which right shall be governed by Section 5.02(a)), and to discuss
--------------
its affairs, finances and condition with its officers and (at the Borrower's
expense no more than twice a year) its independent accountants, all at such
reasonable times and as often as reasonably requested.
SECTION 5.23. Export Control. The Borrower shall, and shall cause each
--------------
Subsidiary to, comply in all respects
with all U.S. export laws and regulations unless the failure to so comply could
not reasonably be expected to have a Material Adverse Effect.
SECTION 5.24. Foreign Corrupt Practices Act. The Borrower shall, and shall
-----------------------------
cause each Subsidiary to, comply in all material respects with the Foreign
Corrupt Practices Act of the United States, if applicable.
SECTION 5.25. Further Assurances. The Borrower shall cause to be promptly
------------------
and duly taken, executed, acknowledged and delivered all such further acts,
documents and assurances as the Administrative Agent from time to time may
reasonably request in order to carry out more effectively the intent and
purposes of this Agreement, the other Loan Documents and the Consents, including
with respect to the maintenance of perfection of all Perfectible Collateral and
the proper grant and perfection of Liens on Perfectible Collateral hereafter
acquired.
SECTION 5.26. Intellectual Property. The Borrower shall not, and shall not
---------------------
permit any Subsidiary to, do any act, or omit to do any act, whereby any of its
intellectual property may lapse or become abandoned or dedicated to the public
or unenforceable, unless such lapse, abandonment, dedication or unenforceability
could not reasonably be expected to have a Material Adverse Effect. The Borrower
shall take, and shall cause each Subsidiary to take, all reasonably necessary
steps to maintain and pursue any application (and to obtain the relevant
registration) filed with respect to, and to maintain any registration of, any
material part of its intellectual property, except where the failure to so
maintain, obtain or pursue could not reasonably be expected to have a Material
Adverse Effect.
SECTION 5.27. Certain Additional Material Contracts. (a) The Borrower
-------------------------------------
shall, or shall cause its Subsidiaries to, enter into (a) with the Operator on
or before May 31, 1999, (i) the O&M Agreement, in form and substance reasonably
satisfactory to the Lead Agents and (ii) the Operator Consent, and, concurrently
with the execution thereof, the Borrower and the Lead Agents (who shall be
permitted to engage, at the Borrower's expense, an independent insurance
consultant reasonably acceptable to the Borrower and the Lead Agents for such
purpose) shall amend Schedule 5.10 to add such insurances as the Borrower and
-------------
the Lead Agents shall agree shall be required to be maintained by the Borrower
during the operational phase of
78
the System or any Segment thereof and (b) with the System Manager on or before
May 31, 1999, (i) the System Management Agreement, in form and substance
reasonably satisfactory to the Lead Agents, and (ii) the System Manager Consent.
Concurrently with the execution and delivery of each such document, the Borrower
shall provide, or cause to be provided to, the Administrative Agent such legal
opinions in connection therewith as the Administrative Agent shall reasonably
request.
(b) If and when the Borrower or any Subsidiary enters into any lease
or sublease for real property on which a landing station that will comprise part
of the System will be situated, such leases shall be in form and substance and
pursuant to arrangements reasonably satisfactory to the Lead Agents (whose
satisfaction may be based upon the taking of such steps as the Lead Agents
reasonably believe are appropriate (i) to mitigate any risks associated with the
bankruptcy of any party thereto) and (ii) if legally practicable, to perfect a
security interests for the benefit of the Secured Parties with respect thereto).
(c) If the Administrative Agent so requests, the Borrower shall, and
shall cause each Subsidiary to, take any and all action required to grant the
Administrative Agent, for the benefit of the Secured Parties, a perfected first
priority security interest (or, if applicable, an assignment effective upon the
occurrence of an Event of Default and the giving by the Administrative Agent to
the counterparty thereto of notice thereof, or a similar available right) in or
of each such Person's rights, title and interests in, to and under the Supply
Contracts, the Supply Contract Guarantees, and, if legally practicable, any
lease for real property on which any landing station comprising part of the
System will be located, in each such case, at such time as such Person becomes a
party to, or acquires any rights, title or interests in, any such contract or
agreement.
SECTION 5.28. Upgradeability. The Borrower shall, and shall cause each
--------------
Subsidiary to, pursue any and all rights and remedies against the Contractor
under the Alcatel Supply Contract if the Contractor is unable to deliver a
System which is practicably susceptible to upgrade under the Alcatel Supply
Contract beyond 20 Gb/s per fiber pair.
SECTION 5.29. First Permitted Upgrade. The Borrower shall, and shall cause
-----------------------
its Subsidiaries to, promptly undertake and complete, in accordance with the
schedule associated therewith set forth in the Alcatel Supply Contract, the
First Permitted Upgrade if, for two consecutive semi-annual periods, the value
of all unsold System Capacity (which shall be calculated by multiplying (a) the
number of unsold STM-1's by (b) the lesser of (i) the average price received by
the Borrower and its Subsidiaries for an STM-1 during the six month period
immediately preceding the time of determination and (ii) the Borrower's and its
Subsidiaries then listed prices for STM-1's), is less than the sum of (x) the
aggregate principal amount of Loans then outstanding plus interest thereon (less
any funds then on deposit in the Debt Service Reserve Account) plus (y) the
----
amount of any undrawn Tranche A-1 Term Loan Commitments.
79
ARTICLE VI.
NEGATIVE COVENANTS
------------------
Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees and other obligations payable hereunder and
under the Loan Documents have been paid in full, the Borrower covenants and
agrees with the Administrative Agent, the Lead Agents and the Lenders that:
SECTION 6.01. Indebtedness. The Borrower shall not, and shall not permit
------------
any Subsidiary to, create, incur, assume or suffer to exist any Indebtedness,
except:
(a) Indebtedness incurred under the Loan Documents;
(b) Permitted Subordinated Debt;
(c) Capital Lease Obligations permitted by Section 6.11;
------------
(d) trade or other similar Indebtedness incurred in the ordinary
course of business and payable within 60 days;
(e) Indebtedness under, or constituting net exposure under, interest
Hedging Agreements entered into in accordance with Section 5.18 or other Hedging
------------
Agreements otherwise permitted by the Lead Agents;
(f) leases and purchase money debt with aggregate annual payments not
to exceed $1,000,000;
(g) Indebtedness under any Permitted Receivables Transaction;
(h) deferred payment obligations of the Borrower or a Subsidiary in
respect of Backhaul Capacity that are incurred in compliance with the provisions
of Section 6.29;
------------
(i) Indebtedness of the Borrower to any Subsidiary and of any
Subsidiary to the Borrower or another Subsidiary, provided that (A) with respect
--------
to any Indebtedness of any Subsidiary to the Borrower, (x) such Indebtedness
shall be evidenced by a promissory note in the form of Exhibit A to the Borrower
---------
Pledge Agreements or such other form as shall be reasonably satisfactory to the
Administrative Agent which shall, in either case, be pledged to the
Administrative Agent pursuant to the Borrower Pledge Agreements and (y) the loan
or other advance by the Borrower to the Subsidiary shall have been made in
accordance with Section 6.05(a)(ii) and (B) with respect to any Indebtedness of
-------------------
the Borrower to any Subsidiary, the repayment of such Indebtedness shall be
subordinated to the repayment of the Loans and all other Obligations in a manner
reasonably satisfactory to the Administrative Agent;
(j) Guarantees by the Borrower of Indebtedness of any Subsidiary
permitted to be incurred hereunder and Guarantees by any Subsidiary of
Indebtedness of the Borrower permitted to be
80
incurred hereunder or of Indebtedness of another Subsidiary permitted to be
incurred hereunder, provided that any such Guarantee referred to in this clause
--------
(j) shall be subordinated to the same extent as the Indebtedness being so
guaranteed;
(k) Indebtedness under a Permitted Reserve L/C Facility; and
(l) other unsecured Indebtedness of the Borrower in an aggregate
principal amount not to exceed $1,750,000 at any one time.
SECTION 6.02. Liens. The Borrower shall not, and shall not permit any
-----
Subsidiary to, create, incur, assume or permit to exist any Lien on the
Collateral or on the System or any of its other assets, except Permitted
Encumbrances.
SECTION 6.03. Fundamental Changes. The Borrower shall not, and shall not
-------------------
permit any Subsidiary to, merge into or consolidate or amalgamate with any other
Person, or permit any other Person to merge into or consolidate or amalgamate
with it, or liquidate, dissolve or wind up or terminate itself, except that (a)
any Subsidiary may merge into or consolidate with the Borrower in a transaction
in which the Borrower is the surviving corporation and (b) any Subsidiary may
merge into or consolidate with another Subsidiary in a transaction in which the
surviving entity is a wholly owned Subsidiary.
SECTION 6.04. Sale of Assets. The Borrower shall not, and shall not permit
--------------
any Subsidiary to, sell, lease (as lessor), convey, assign, transfer or
otherwise dispose of (each, a "Transfer") all or any portion of its assets
--------
except (a) Transfers of Capacity in accordance with Section 6.23, (b) Transfers
------------
of assets by any Subsidiary to the Borrower, (c) Transfers of assets (other than
Capacity) in the ordinary course of business not required for the efficient
operation of the System for fair value, (d) Transfers of non-cash assets to a
Subsidiary but only to the extent such Transfers are in the ordinary course of
business or are in connection with constructing, maintaining, owning or
operating the System or, with the prior approval of the Administrative Agent,
are necessary to facilitate the obtaining of Governmental Actions or the
minimization of Taxes (e) Transfers of cash to a Subsidiary in accordance with
Section 6.05, (f) Transfers of obsolete, worn out, unusable, unuseful or
------------
defective equipment and other assets for fair value and Transfers of equipment
or assets (other than Capacity) to the extent such equipment or assets are being
replaced by equipment or assets having a fair market value or utility to the
System equal to or greater than the fair market value of the equipment or assets
being so transferred, including any such Transfers made in connection with a
Permitted System Upgrade and (g) Transfers of accounts solely for cash in
accordance with the terms of a Permitted Receivables Transaction, provided that
--------
the proceeds or the Net Cash Proceeds of Transfers under (A) clauses (C), (F)
and (G) shall be applied to the prepayment of the loans if required in
accordance with the provisions of the Securities Accounts Agreements and (B)
under clauses (A) and (G) shall be deposited into the Revenue Account if
required in accordance with the provisions of the Securities Accounts Agreement.
SECTION 6.05. Investments, Loans, Advances, Guarantees and Acquisitions.
---------------------------------------------------------
(a) The Borrower shall not, and shall not permit any Subsidiary to, purchase,
hold or acquire (including pursuant to any merger with any Person that was not a
wholly owned Subsidiary prior to such merger) any Capital Stock, evidences of
indebtedness or other securities (including any
81
option, warrant or other right to acquire any of the foregoing) of, make or
permit to exist any loans or advances to, Guarantee any obligations of, or make
or permit to exist any investment or any other interest in, any other Person, or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person constituting a business unit, or become a general
or limited partner in any partnership or a joint venturer in any joint venture
or enter into any profit sharing or royalty agreement or similar arrangement
whereby the Borrower's or any Subsidiary's income or profits are, or might be,
shared with any Person, or create any new Subsidiary, except:
(i) Permitted Investments;
(ii) investments by the Borrower in, or loans or other
advances by the Borrower to, a Subsidiary, provided that (A) such
--------
investment, loan or other advance is necessary to capitalize such
Subsidiary in accordance with applicable law, to enable such Subsidiary to
acquire assets to be used to operate the System or to otherwise fulfill
obligations incurred in connection with the System and reflected in the
Capital Budget or the Operating Budget or, with the prior consent of the
Administrative Agent, to facilitate the obtaining of Landing Licenses or
the minimization of material Taxes and (B) such investment, loan or other
advance, if made in cash, is made with funds made available for such
purpose in accordance with the Securities Accounts Agreement or from
Permitted Sources;
(iii) investments by a Subsidiary in, or loans or other
advances by a Subsidiary to, the Borrower;
(iv) the Guarantees set forth in the System Contracts;
(v) endorsements for collection or deposit in the ordinary
course of business;
(vi) indemnity or "hold harmless" provisions included in
contracts or agreements entered into in the ordinary course of business;
(vii) joint marketing agreements entered into in accordance
with Section 6.16; and
------------
(viii) Indebtedness and Guarantees permitted by Section 6.01;
------------
and
(ix) guarantees by the Borrower of obligations of any
Subsidiary that are permitted to be incurred hereunder and guarantees by
any Subsidiary of obligations of the Borrower that are permitted to be
incurred hereunder (other than, in each such case, those refereed to in
clause (viii) above); and
(x) the Borrower and its Subsidiaries may create or acquire
new Subsidiaries in accordance with Section 6.05(b).
---------------
82
(b) Neither the Borrower nor any Subsidiary shall create or acquire
any Subsidiary or acquire the Capital Stock of any other Person unless:
(1) such Person shall be a direct or indirect wholly owned
Subsidiary of the Borrower;
(2) the creation or acquisition of such new Subsidiary could not
reasonably be expected to have a Material Impact;
(3) such Subsidiary shall be or become a party to (i) a guaranty
in substantially the form of the guaranty agreement attached hereto as
Exhibit F (or such other form as the Borrower may reasonably request to
---------
conform such guaranty to local law or to avoid adverse tax consequences,
which form shall, in any event, be reasonably satisfactory to
Administrative Agent) and (ii) a security agreement in substantially the
form of the security agreement attached hereto as Exhibit E, in each case,
---------
with such modifications as the Administrative Agent may reasonably request
or consent to;
(4) the Borrower shall pledge, have pledged or cause or have
caused to be pledged to the Administrative Agent all of the outstanding
shares of such Capital Stock or other ownership interests of such
Subsidiary owned directly by it, along with undated stock powers for such
certificates, executed in blank (or, if any such shares of Capital Stock or
other ownership interests are uncertificated, confirmation and evidence
satisfactory to the Administrative Agent that the security interest in such
uncertificated securities has been perfected by the Administrative Agent in
accordance with Article 8 of the UCC or any similar law which may be
applicable); in order to effect the foregoing, the Borrower shall either
amend the Borrower Pledge Agreements in order to identify the Capital Stock
and other related collateral in respect of such Subsidiary, or, in the case
of a Subsidiary incorporated or otherwise existing pursuant to the laws of
any jurisdiction other than the United States or any political subdivision
thereof, shall enter into a pledge agreement in form and substance
reasonably satisfactory to the Administrative Agent;
(5) the parties to the Securities Accounts Agreements and the new
Subsidiary shall enter into a supplement thereto or amendment thereof
whereby the new Subsidiary shall become a party thereto and the Securities
Accounts Agreement shall be amended in accordance with Section 5.4.2
-------------
thereof;
(6) the Borrower shall, and shall cause the new Subsidiary to,
take such other actions as the Administrative Agent may reasonably request
in order to perfect a first priority security interest of the
Administrative Agent in such types of collateral as were perfected with
respect to the other Subsidiaries as of the Closing Date; and
(7) the Administrative Agent shall have received such opinions of
legal counsel for the Borrower relating to each of the matters identified
in clauses (1), (3), (4), (5) and (6) above as the Administrative Agent
shall reasonably request, which legal opinions shall be in form and
substance reasonably satisfactory to the Administrative Agent.
83
SECTION 6.06. Restricted Payments. The Borrower shall not, and shall not
-------------------
permit any Subsidiary to, declare or make any Restricted Payment or any payment
in connection with any tax sharing arrangement except for (a) Restricted
Payments by a Subsidiary to the Borrower, or to any parent of a Subsidiary that
is, directly or indirectly, wholly owned by the Borrower, (b) distributions by
the Borrower or any Subsidiary in respect of its Capital Stock which are payable
solely in additional Capital Stock of the Borrower or such Subsidiary, but only
to the extent such additional Capital Stock is subject to a first priority Lien
in favor of the Administrative Agent, (c) distributions by the Borrower of the
Borrower's portion of Excess Cash Flow to the extent then distributable to the
Borrower pursuant to the Section 2.7.4(a) of the Securities Accounts Agreement,
----------------
(d) distributions by the Borrower from the Distribution Account and (e)
distributions by the Borrower or the U.S. Subsidiary of funds made available
exclusively for the benefit of any such Person pursuant to Section
-------
2.22.3(a)(A)(1) or 2.24.3(a)(A)(1) of the Securities Accounts Agreement.
--------------- ---------------
SECTION 6.07. Amendment of System Contracts, Etc. (a) The Borrower shall
----------------------------------
not, and shall not permit any Subsidiary to, amend, supplement or otherwise
modify, or grant any material waivers or material consents under, or agree to
any material contract variation or material discretionary or other material
change that requires the consent or agreement of the Borrower under, any System
Contract without the prior written consent of the Majority Lenders (such consent
not to be unreasonably withheld) other than (i) Contract Variations in
accordance with Section 6.08, (ii) as permitted by the terms of such System
------------
Contract without the consent of the Borrower or such Subsidiary, (iii)
amendments, supplements or other modifications or waivers, consents, contract
variations, or exercises of discretionary action or other changes to Non-
Material System Contracts which are entered into in the ordinary course of
business and which could not reasonably be expected to have a Material Impact,
provided that in any event no amendments, supplements or other
--------
modifications may be made to the provisions relating to the Alcatel Escrow
Dispute Account or the TSSL Dispute Account contained in the applicable
Contractor Escrow Agreements without the prior written consent of the
Administrative Agent, (iv) administerial, clarifying or correcting amendments to
any System Contract or other immaterial amendments to any System Contract (other
than the Supply Contracts and the Supply Contract Guarantees, in respect of
which such amendments may be made with the consent of the Lead Agents) which
could not reasonably be expected to have a Material Impact (it being understood
that, for purposes of this clause (iv), an increased cost permitted pursuant to
Section 5.14 shall not be deemed to have a Material Impact solely by reason of
------------
such increased cost), (v) other amendments, supplements or modifications or
waivers, consents, contract variations or exercises of discretionary action or
other changes not involving the Supply Contracts that do not involve increased
costs other than as permitted pursuant to Section 5.14 and which, in any event,
------------
could not reasonably be expected to have a Material Impact, (vi) amendments,
supplements or other modifications required to implement the provisions of
Section 6.09 or 6.10, and (vii) amendments, supplements or other modifications
------------ ----
or waivers, consents, contract variations or other changes to Capacity Sales
Agreements so long as any such amendments are on commercially reasonable terms
and comply with the proviso to Section 6.23(a); provided, however, that,
--------------- -------- -------
notwithstanding the foregoing, no amendments, supplements or other modifications
or waivers, consents, contract variations or other changes to the Intercompany
84
Agreement or the U.S. Landing Agreement shall be made without the prior written
consent of the Lead Agents.
(b) The Borrower shall not, and shall not permit any Subsidiary to,
terminate or permit the termination of any System Contract other than (i) in
accordance with its terms (other than at the option of the Borrower or any
Subsidiary), (ii) as permitted by such System Contract without the consent of
the Borrower or such Subsidiary, (iii) as required by applicable law, (iv) a
System Contract (other than the Supply Contract Guarantees) which the Borrower
reasonably believes (and in respect of which, if such System Contract is a
Supply Contract, the O&M Agreement, the System Management Agreement or the
Marketing Agreement, the Lead Agents concur in writing prior to any termination
thereof), is no longer useful to the Borrower's business, or which the Borrower
reasonably believes (and in respect of which, if such System Contract is a
Supply Contract, the O&M Agreement, the System Management Agreement or the
Marketing Agreement, the Lead Agents concur in writing prior to any termination
thereof) is useful to the Borrower's business and is replaced with a new
contract (and within a time period) reasonably acceptable to the Administrative
Agent, (v) as to Non-Material System Contracts, so long as such Non-Material
System Contract is, at the request of the Administrative Agent (upon such
consultation with the Independent Engineer as the Administrative Agent shall
require), replaced with a new contract (and within a time period) reasonably
acceptable to the Administrative Agent, and (vi) the termination of a Capacity
Sales Agreement, provided that if the Borrower or any Subsidiary is terminating
--------
or consenting to the termination of a Capacity Sales Agreement, such termination
or consent to termination shall be permitted only if it is commercially
reasonable; provided, however, that, notwithstanding the foregoing, the Borrower
-------- -------
shall not, and shall not permit any Subsidiary to, terminate or permit the
termination of the Intercompany Agreement or any lease or sublease for real
property on which a landing station that will comprise part of the System will
be located without the prior written consent of the Lead Agents, other than in
accordance with clause (i) of this sentence.
(c) The Borrower and each Subsidiary shall be permitted to replace
certain System Contracts in accordance with the terms of Article VII.
-----------
SECTION 6.08. Supply Contracts. (a) The Borrower shall not, without the
----------------
prior written consent of the Majority Lenders (or, with respect to any Contract
Variation that will not increase the costs under a Supply Contract by more than
$500,000 for any individual Contract Variation and up to $3,000,000 in the
aggregate for all Contract Variations taken together, the Administrative Agent),
such consent in each case not to be unreasonably withheld, enter into any
Contract Variation, or grant any waiver or consent under, a Supply Contract
other than (i) Contract Variations, waivers or consents made on an emergency
basis to the extent there are funds available for the payment thereof in the
Capital Budget (including the Unrestricted Contingency, but excluding the
Restricted Contingency except to the extent that the Restricted Contingency is
permitted to be so utilized in accordance with Section 6.21) so long as such
------------
Contract Variation, waiver or consent could not reasonably be expected to have a
Material Adverse Effect, (ii) Contract Variations, waivers or consents required
to add an additional Landing Location or select an alternative Landing Location
consistent with the provisions of Section 6.09, (iii) Contract Variations,
------------
waivers or consents required to undertake a Permitted
85
System Upgrade consistent with the provisions of Section 6.10, (iv) Contract
------------
Variations, waivers or consents that merely change the route of the System (so
long as the Landing Locations do not change) without increasing the cost under
the Supply Contracts (or, if such change would increase the cost under the
Supply Contracts, such increase is funded with Permitted Sources), so long as
such Contract Variation, waiver or consent could not reasonably be expected to
have a Material Adverse Effect, (v) Contract Variations, waivers or consents
otherwise permitted by Section 6.07, (vi) Supplement No. 2 to the Alcatel Supply
------------
Contract (which shall be substantially in the form of the document attached as
Exhibit H hereto with such changes as are reasonably satisfactory to the Lead
---------
Agents) and (vii) immaterial consents and waivers that could not reasonably be
expected to have a Material Adverse Effect, provided that in no event shall any
--------
such Contract Variation, waiver or consent made in accordance with this
Section 6.08(a) be expected to materially adversely affect the revenues of the
---------------
Borrower and the Subsidiaries or, in the reasonable opinion of the Borrower at
the time of the amendment, their ability to achieve the Commercial Operation
Date on or before the earlier to occur of (A) the date that is the 3 month
anniversary of the Scheduled RFS Date and (B) the Guaranteed Completion Date.
(b) The Borrower shall not, (i) without the prior written consent of
the Majority Lenders (such consent not to be unreasonably withheld), (A) reduce
the amount or change the date (unless such change is consistent with a change to
the Scheduled RFS Date or to a "Scheduled Segment RFS Date" (as defined in the
Alcatel Supply Contract as in effect on the date hereof) which is permitted
hereunder) or basis for payment of liquidated damages under any Supply Contract
or (B) reduce the duration of any warranty period under any Supply Contract and
(ii) without the prior written consent of the Lead Agents (based upon
consultation with the Independent Engineer and such consent not to be
unreasonably withheld), (w) reduce the scope of any warranty under any Supply
Contract, (x) reduce the scope or availability of intellectual property under
any Supply Contract or (y) materially change the terms of payment as set forth
in any Supply Contract.
(c) The Borrower shall not, (i) without the prior written consent of
the Lead Agents (whose consent shall not be unreasonably withheld and who may,
in determining whether to give such consent, consult with the Independent
Engineer), agree to (A) procedures for the acceptance testing of the Basic
System (and, if the Borrower elects to or is required to undertake the First
Permitted Upgrade, the Upgraded System) contemplated under the definition of
"Acceptance Testing" or any comparable definition, (B) new acceptance testing of
the Basic System (and, if the Borrower elects to or is required to undertake the
First Permitted Upgrade, the Upgraded System), as contemplated under the
definition of "Acceptance Testing" or any comparable definition, (C) new
performance requirements for the Basic System (and, if the Borrower elects to or
is required to undertake the First Permitted Upgrade, the Upgraded System), as
contemplated under the definition of "Performance Requirements" or any
comparable definition and any material term or appendix or exhibit underlying
the substance of such definition, (D) any equitable adjustment to the price
under any Supply Contract or (E) issue, with respect to the Basic System (and,
if the Borrower elects to or is required to undertake the First Permitted
Upgrade, the Upgraded System), a Certificate of Commercial Acceptance, a
Certificate of Provisional Acceptance or a Certificate of Final Acceptance under
the Alcatel Supply Contracts or a Certificate of Final Completion or a
Certificate of Substantial Completion
86
under the Tyco Supply Contract or any other such comparable certificates under
any Supply Contract and (ii) without the prior written consent of the Majority
Lenders, (A) grant or otherwise consent to any extension of time under Article
17(B) of the Alcatel Supply Contract or (B) agree to any arrangement to extend
the Scheduled RFS Date with respect to the Basic System or, if the Borrower
elects or is required to undertake the First Permitted Upgrade, the "Scheduled
Upgrade Date" (as defined in the Alcatel Supply Contract as in effect on the
date hereof whether pursuant to the penultimate sentence of Section 6A(K) of the
Alcatel Supply Contract or otherwise) by more than 3 months or to extend any
"Scheduled Segment RFS Date" (as defined in the Alcatel Supply Contract as in
effect on the date hereof) by more than 3 months.
SECTION 6.09. Addition to Configuration. The Borrower shall not, without
-------------------------
the prior written consent of the Majority Lenders (which consent shall not be
unreasonably withheld), add any additional Landing Location or select, or agree
to the selection of, any alternative Landing Location to the contemplated
configuration of the System unless (a) in the case of adding an additional
Landing Location, all costs related to such addition are funded with Permitted
Sources, (b) such change could not reasonably be expected to materially
adversely affect the revenues of the Borrower and its Subsidiaries or their
ability to achieve the Commercial Operation Date on or prior to the Guaranteed
Completion Date and (c) no material liabilities of or costs to the Borrower or
any Subsidiary shall be created which are not provided for from Permitted
Sources.
SECTION 6.10. Permitted System Upgrades. The Borrower shall not request
-------------------------
that the Contractor perform any Permitted System Upgrade unless (a) the costs
thereof are paid (i) in the case of the First Permitted Upgrade, with proceeds
from Tranche A-2 Term Loan Borrowings and/or with Permitted Sources and (ii) in
the case of any other Permitted System Upgrade, with Permitted Sources (b) such
addition could not reasonably be expected to materially adversely affect the
revenues of the Borrower and its Subsidiaries or, if the Permitted System
Upgrade is commenced prior to the Commercial Operation Date, their ability to
achieve the Commercial Operation Date on or prior to the earlier to occur of (x)
the date which is the 3 month anniversary of the Scheduled RFS Date and (y) the
Guaranteed Completion Date.
SECTION 6.11. Leases. The Borrower shall not, and shall not permit any
------
Subsidiary to, enter into any lease except for (a) leases of personal property
in the ordinary course of business, (b) leases of real property in the ordinary
course of business, (c) Capital Lease Obligations for the lease of office
equipment and automobiles in the ordinary course of business, (d) with the prior
written consent of the Administrative Agent (which consent shall not be
unreasonably withheld), leases to other Persons of a portion of the Borrower's
or any Subsidiary's cable landing stations as long as such leases do not
interfere with the Borrower's and the Subsidiary's use thereof in any material
respect and (e) leases of Capacity in accordance with clause (a) of
Section 6.04.
------------
SECTION 6.12. Change of Office. The Borrower shall not, and shall not
----------------
permit any Subsidiary to, change the location of its principal place of business
unless the Borrower shall have given the Administrative Agent at least 20 days'
prior written notice thereof and all action
87
reasonably requested by the Administrative Agent to protect and perfect the
Liens and security interests in the Collateral shall have been taken.
SECTION 6.13. Change of Name. The Borrower shall not, and shall not permit
--------------
any Subsidiary to, change its name unless the Borrower shall have given the
Administrative Agent at least 20 days' prior written notice thereof and all
action reasonably requested by the Administrative Agent to protect and perfect
the Liens and security interests in the Collateral shall have been taken.
SECTION 6.14. Transactions with Affiliates. The Borrower shall not, and
----------------------------
shall not permit any Subsidiary to, enter into any agreement with any Affiliate
of the Borrower except (a) the Loan Documents or the System Contracts in effect
as of the Closing Date, (b) the St. Croix Contracts and the AC-1 Co-Location
Agreement and (c) transactions in the ordinary course of business (including
(subject to the other provisions hereof) sales of Capacity and joint sales and
marketing agreements) which are on fair and reasonable terms not less favorable
than the Borrower or any Subsidiary could obtain in an arm's-length transaction
with a Person which is not an Affiliate, provided that (i) after giving effect
--------
to such transaction, the Borrower or such Subsidiary will be in compliance with
the terms hereof and (ii) entering into any such transaction could not
reasonably be expected to have a Material Impact.
SECTION 6.15. Sale and Leaseback. The Borrower shall not, and shall not
------------------
permit any Subsidiary to, enter into any arrangement with any Person providing
for the leasing of real or personal property which has been or is to be sold by
it to such Person.
SECTION 6.16. Approval of Additional Contracts. Without the prior written
--------------------------------
consent of the Majority Lenders (such consent not to be unreasonably withheld),
the Borrower shall not, and shall not permit any Subsidiary to, enter into any
Additional Contract, other than (a) Capacity Sales Agreements or other
agreements or arrangements for the disposition of Capacity permitted by the
terms of Section 6.23, (b) contracts for the acquisition of Backhaul Capacity
------------
(including options therefor) permitted by the terms of Section 6.23 or 6.29, (c)
------------ ----
other contracts (including, without limitation, agreements providing for the
connection of the System to other fiber optic networks, pipeline and cable
crossing agreements, co-location agreements, joint sales and marketing
agreements and restoration agreements) in the ordinary course of business to the
extent amounts payable thereunder, if any, are provided for in the Capital
Budget or the Operating Budget or from Permitted Sources, unless any such
contract must be approved by the Administrative Agent, the Lead Agents or any
other Person or group of Persons pursuant to the terms of this Agreement and (d)
with the prior written consent of the Lead Agents, if such Additional Contract
relates to the System and is being entered into as a quid pro quo for
------------
the purchase of Capacity by the counterparty thereto. The Borrower shall be
permitted to replace System Contracts as set forth in Section 6.07 and Article
------------ -------
VII. At the time any such Additional Contract (other than a Capacity Sales
---
Agreement) is entered into, the Borrower and the Administrative Agent (upon
consultation with the Independent Engineer, if necessary) shall designate such
Additional Contract as either an "Additional Material Contract" or an
"Additional Non-Material Contract," provided that each of the O&M Agreement, the
--------
System Management Agreement, and any contract in respect of the leasing of real
property on which a landing station
88
that comprises part of the System will be located shall be designated as an
"Additional Material Contract."
SECTION 6.17. Capital Expenditures. The Borrower shall not, and shall not
--------------------
permit any Subsidiary to, make any expenditure in respect of the purchase of
capital assets, except for expenditures which are (a) covered by the Capital
Budget or the then current Operating Budget or (b) to the extent not covered by
the Capital Budget or the then current Operating Budget, paid for from Permitted
Sources or with the transfer of Capacity pursuant to the terms hereof.
SECTION 6.18. Limitations on Transfer and Issuance of Interests.
-------------------------------------------------
The Borrower shall not, and shall not permit any Subsidiary to, (a) permit the
transfer of any ownership interest in any Subsidiary, except to another wholly
owned Subsidiary of the Borrower in accordance with Section 6.03 or (b) issue
------------
any additional ownership interests unless in each such case (and subject in any
event to the provisions of Section 7.14) such ownership interests (i) are being
------------
issued in accordance with Section 6.06(b) or are being issued by a Subsidiary to
---------------
the Borrower (whether in addition to or in substitution for the then outstanding
Capital Stock of such Subsidiary) and (ii) are made subject to the first
priority Lien in favor of the Administrative Agent.
SECTION 6.19. Unrelated Activities; Abandonment. The Borrower shall not,
---------------------------------
and shall not permit any Subsidiary to, (i) engage in any business other than
System Activities or as otherwise contemplated by the System Contracts and the
Loan Documents, and activities incidental thereto or (ii) abandon the diligent
development, construction, installation or operation of the System.
SECTION 6.20. Set-off. Without the prior written consent of the
-------
Administrative Agent (such consent not to be unreasonably withheld), the
Borrower shall not, and shall not permit any Subsidiary to, exercise any right
of set-off with respect to amounts owing to it by any System Contractor under
any Supply Contract.
SECTION 6.21. Changes in Capital Budget. Without the prior written consent
-------------------------
of the Majority Lenders (such consent not to be unreasonably withheld), the
Borrower shall not modify the Capital Budget to increase the aggregate amount
payable thereunder unless such modification is a necessary conforming change
related to an amendment to a System Contract permitted by Section 6.07 or
------------
Section 6.08 or is made in respect of the First Permitted Upgrade or the payment
------------
of Marketing Commissions and, in each such case, is concurrent and consistent
with any Permitted Sources or other funds made available to the Borrower which
were not theretofore contemplated in the Capital Budget (including liquidated
damages being applied to obligations hereunder and proceeds of insurance applied
in accordance with the terms of this Agreement); provided that the foregoing
--------
shall not prevent the Borrower from applying identified cost savings in a budget
category (as confirmed by the Independent Engineer or the Administrative Agent,
as applicable) to cost overruns in another budget category (as confirmed by the
Independent Engineer or the Administrative Agent, as applicable) or to new
budget categories reasonably acceptable to the Lead Agents without increasing
the aggregate amount payable under the Capital Budget; provided, further, that
-------- --------
the Borrower shall be permitted to apply (A) the Unrestricted
89
Contingency to other budget categories without the consent of the Administrative
Agent, the Lead Agents or any other Lender and (B) the Restricted Contingency to
other budget categories with the consent of the Lead Agents; and provided,
--------
further, that if and when all cable stations comprising part of the System have
-------
been completed to the satisfaction of the Independent Engineer and for an
aggregate cost no greater than the aggregate amount budgeted therefor in the
then current Capital Budget, the Restricted Contingency shall be reduced by
$12,000,000 (or, if less than $12,000,000 remains allocated to the Restricted
Contingency, by such lesser amount) and the Unrestricted Contingency shall be
increased by a like amount.
SECTION 6.22. Payment of Construction Costs. The Borrower shall not, and
-----------------------------
shall not permit its Subsidiaries to, pay any amount in respect of the
construction and installation of the Basic System or the Upgraded System other
than those costs set forth or provided for in the Capital Budget, as the same
may be amended in accordance with Section 6.21, unless (i) such amount is paid
------------
for with the proceeds of Special Payments or Casualty Proceeds applied in
accordance with the Securities Accounts Agreement or with Permitted Sources,
(ii) such amount relates to the payment of Marketing Commissions and is paid
with funds made available for such purpose from the Revenue Account in
accordance with the provisions of the Securities Accounts Agreement or (iii)
such amount relates to the acquisition of Backhaul Capacity and is paid with
funds made available for such purpose from the Backhaul Account, the U.K.
Backhaul Account or the U.S. Backhaul Account in accordance with the provisions
of the Securities Accounts Agreement.
SECTION 6.23. Sales of Capacity. (a) The Borrower shall not, and shall not
-----------------
permit any Subsidiary to, sell or otherwise dispose of Capacity except pursuant
to Capacity Sales Agreements substantially in the form of Exhibit I or otherwise
---------
on commercially reasonable terms, which shall, subject to paragraph (b) below,
include the disposition thereof for non-cash consideration, such as for capacity
on other systems; provided that, in any event, (i) all such agreements and
--------
arrangements shall provide that any amounts payable to the Borrower or any
Subsidiary shall be paid to the Revenue Account or the U.S. Backhaul Account (as
the case may be) in accordance with the provisions of the Securities Accounts
Agreement and (ii) no agreement providing for future payments shall restrict
either contractually or as a matter of law the granting of a security interest
in such agreement by the Borrower or any Subsidiary to the Lenders.
(b) (1) The Borrower shall not, and shall not permit any Subsidiary
to, sell, lease, transfer or otherwise dispose of System Capacity in exchange
for non-cash consideration (such System Capacity being referred to as "Swapped
-------
System Capacity" and such sale, lease, transfer or other disposition being
---------------
referred to as a "Swap") to Affiliates of the Borrower or any Subsidiary,
----
whether in one transaction or a series of related transactions, if the aggregate
value of the Swapped System Capacity (which shall be determined by reference to
the Borrower's listed prices for such System Capacity at the time of such
disposition) being disposed of to all such Affiliates exceeds $10,000,000,
unless the Lead Agents otherwise agree to the contrary. If any non-cash
consideration received by the Borrower or any Subsidiary in exchange for Swapped
System Capacity disposed of to an Affiliate of the Borrower or a Subsidiary is
disposed of for cash (the amount of such cash being referred to as the
"Affiliate Capacity Cash Amount"), the
-------------------------------
90
amount of Swapped System Capacity disposed of to Affiliates of the Borrower and
such Subsidiary shall be deemed to be reduced by an amount equal to the amount
of System Capacity that a third party could purchase for the Affiliate Capacity
Cash Amount at the Borrower's listed System Capacity prices at the time of such
disposition.
(2) Swapped System Capacity shall only be disposed of in exchange for
fair value for other fiber optic cables or capacity thereon which can and will
be connected to the System or are being acquired in connection with facilitating
sales of Capacity or for other assets relating to and useful for the System
(which would not, for the avoidance of doubt, include satellite capacity or
wireless capacity (other than for restoration purposes)).
(3) The Borrower shall not, and shall not permit any Subsidiary to,
Swap any System Capacity if, after giving effect to such Swap, the aggregate
amount of System Capacity disposed of pursuant to Swaps exceeds (i) prior to the
First Permitted Upgrade Final Completion, one STM-16 and (ii) on and after First
Permitted Upgrade Final Completion, two STM-16's.
SECTION 6.24. Financial Covenants. (a) Minimum Capacity Sales Revenue.
------------------- ------------------------------
The Borrower shall not permit Capacity Sales Revenue to be less than the
following amounts as of the last day of the calendar quarter immediately
preceding each Principal Payment Date set forth below:
Principal Payment Minimum Cumulative
Date Capacity Sales Revenue
---- --------------------------
(in Dollars)
First 96,200,000
Second 135,700,000
Third 178,200,000
Fourth 215,800,000
Fifth 243,500,000
Sixth 269,000,000
Seventh 290,300,000
Eighth 311,100,000
Ninth 331,100,000
Tenth 351,300,000
(b) Minimum Interest Coverage Ratio. The Borrower shall not permit,
-------------------------------
(1) for the 6 month period ending on the first date set forth below and (2)
thereafter, for any period consisting of two consecutive 6 month periods (each
of which shall consist of 2 calendar quarters) ending on the last day of the
calendar quarter immediately preceding a Principal Payment Date (other than the
Initial Principal Payment Date if it occurs less than 6 months after the
Commercial Operation Date) occurring in any year set forth below, the Interest
Coverage Ratio for such period to be less than the ratio set forth below:
91
Year Interest Coverage Ratio
---- -----------------------
2000 3.00:1
2001 3.50:1
2002 4.00:1
2003 and onwards 7.00:1
(c) Minimum Remaining Asset Value to Debt. If the System delivered by
-------------------------------------
the Contractor shall not be practicably susceptible to the full implementation
of the First Permitted Upgrade, the Borrower shall not permit the value of all
unsold System Capacity (which shall be calculated by multiplying the number of
unsold STM-1's by the average price received by the Borrower and the
Subsidiaries for an STM-1 during the 6 month period immediately preceding the
time of determination) to be less than 125% of the aggregate principal amount of
the Loans then outstanding plus interest thereon (less any funds then on deposit
in the Debt Reserve Account).
Notwithstanding anything to the contrary contained in this Agreement, the
failure to comply with Section 6.24(a), 6.24(b) and/or 6.24(c) at any time shall
--------------- ------- -------
not constitute an Event of Default, but shall, instead, cause 100% of Excess
Cash Flow to be paid to the Administrative Agent for the account of the Lenders
in accordance with Section 2.7.4(a) of the Securities Accounts Agreement until
----------------
such time as the Borrower shall have delivered a certificate to the
Administrative Agent in accordance with Section 5.02(c) evidencing the
---------------
Borrower's compliance with this Section 6.24.
------------
SECTION 6.25. Amendments, Etc. of Organizational and Other Documents.
------------------------------------------------------
The Borrower shall not, and shall not permit any Subsidiary to, amend,
supplement or otherwise modify, or permit the amendment, modification or
supplementation of, (a) the certificate of incorporation or by-laws or other
organizational documents (including any Bylaws or Memoranda of Association) in a
manner which is inconsistent with or violates the terms of or could reasonably
be expected to prevent compliance with any of the terms of any Loan Document or
System Contract or could materially adversely affect the Lenders or any
Collateral or (b) if issued in accordance with and subject to the terms of this
Agreement, any documents evidencing or relating to Permitted Subordinated Debt
which could adversely affect the Lenders or result in provisions that are more
onerous on the Borrower or any Subsidiary.
SECTION 6.26. Management and Advisory Fees, Etc. The Borrower shall not,
---------------------------------
and shall not permit any Subsidiary to, pay any management, advisory, consulting
or other similar fees to any Affiliate of the Borrower without the prior consent
of the Lead Agents, other than the (i) Financial Services Arrangement Fee
payable pursuant to the Financial Services Agreement as in effect on the date
hereof, (ii) Marketing Commissions payable pursuant to the Marketing Agreement
as in effect on the date hereof and (iii) fees payable under the OA&M Agreement
as in effect on the date such agreement is approved by the Lead Agents in
accordance with Section 5.27.
------------
SECTION 6.27. Immunity. Neither the Borrower nor any Subsidiary shall, in
--------
any proceeding in Bermuda, the United States or elsewhere, in connection with
any Loan Document,
92
claim for itself, any of its assets or the System, immunity from suit,
execution, attachment or other legal process.
SECTION 6.28. Amendments to Operating Budget. The Borrower shall not amend
------------------------------
or modify the Operating Budget for any Operating Year to increase the aggregate
amount of expenses set forth therein without the prior written consent of the
Lead Agents unless (i) after giving effect to such amendment, the OA&M Expenses
set forth therein are not greater than 115% of the OA&M Expenses in respect of
such Operating Year set forth in the Operating Plan approved pursuant to
Section 5.14(a) or (ii) the amendment applies identified cost savings in
---------------
a budget category (as confirmed by the Independent Engineer or the
Administrative Agent, as applicable) to cost overruns in another budget category
(as confirmed by the Independent Engineer or the Administrative Agent, as
applicable) or to new budget categories reasonably acceptable to the Lead Agents
without increasing the aggregate amount payable under such Operating Budget.
SECTION 6.29. Backhaul. (a) The Borrower shall not, and shall not permit
--------
any Subsidiary to, make any cash expenditures in respect of Backhaul Capacity
other than from (x) funds available for such purpose from the Capital Budget,
(y) the Backhaul Account, the U.K. Backhaul Account or the U.S. Backhaul Account
and (z) Permitted Sources.
(b) Backhaul Capacity shall consist only of capacity on fiber optic
telecommunications systems (other than the System) which can and will be
connected to the System or is being acquired in connection with facilitating
sales of System Capacity or for other assets relating to and useful for the
System (which would not, for the avoidance of doubt, include satellite capacity
or wireless capacity (other than for restoration purposes)).
(c) At any time of determination, (x) the aggregate amount of the
deferred payment obligations of the Borrower and any Subsidiary in respect of
the purchase of Backhaul Capacity from other Persons minus (y) the lesser of (i)
the aggregate amount of the deferred payment obligations of other Persons to the
Borrower and any Subsidiary in respect of the purchase of Backhaul Capacity from
the Borrower and any Subsidiary and (ii) $10,000,000, shall not exceed
$15,000,000.
SECTION 6.30. Exchange Rate Risk. The Borrower shall not, and shall not
------------------
permit any Subsidiary to, incur any material currency exchange rate risk in
respect of deferred payment obligations of other Persons to the Borrower or a
Subsidiary that are payable in any currency other than Dollars and which are due
to the Borrower or a Subsidiary more than one year after the contracted
obligation with respect to such deferred payment obligation was entered into.
ARTICLE VII.
EVENTS OF DEFAULT
-----------------
Each of the following events or occurrences described in this Article VII
-----------
shall constitute an "Event of Default."
93
SECTION 7.01. Non-Payment of Obligations. The Borrower shall fail to pay
--------------------------
any principal of any Loan when and as the same shall become due and payable; or
the Borrower shall fail to pay any interest on any Loan or any fee payable under
this Agreement or any other Loan Document when and as the same shall become due
and payable, and such failure shall continue unremedied for a period of 5 days;
or the Borrower or any Subsidiary shall fail to pay any other amount payable
under this Agreement or any other Loan Document when and as the same shall
become due and payable, and such failure shall continue unremedied for a period
of 5 days following the Borrower's receipt of written notice thereof from the
Administrative Agent.
SECTION 7.02. Breach of Warranty. Any representation or warranty made or
------------------
deemed made by the Borrower or any Loan Party in this Agreement, or in any other
Loan Document to which it is a party or in any certificate delivered by the
Borrower or any Loan Party pursuant to this Agreement or any other Loan Document
shall prove to have been false or misleading in any material respect as of the
time made or deemed made and, if such misrepresentation is capable of being
corrected as of a subsequent date, such misrepresentation shall not have been
corrected as of a day within 30 calendar days (or if such misrepresentation
could not reasonably be expected to have a Material Adverse Effect, within 60
calendar days) following written notice thereof being given by the
Administrative Agent to the Borrower or such Loan Party.
SECTION 7.03. Non-Performance of Certain Covenants and Obligations.
----------------------------------------------------
(a) The Borrower shall fail to observe or perform any covenant or agreement
contained in Article VI of this Agreement (other than Section 6.24); (b) (1) any
---------- ------------
Subsidiary shall fail to perform any of its covenants or agreements contained in
clause (b) of Article IV of the Subsidiary Guaranty Agreement to which it is a
----------
party, (2) any Shareholder shall fail to perform any negative covenant or
agreement contained in any Loan Document to which is a party, or (3) any other
Person pledging shares of Capital Stock to the Administrative Agent shall fail
to perform any of its negative covenants or agreements contained in any pledge
agreement in favor of the Administrative Agent to which it may become a party;
or (c) the Borrower or any other Loan Party shall fail to observe or perform any
covenant or agreement contained in this Agreement or any other Loan Document to
which it is a party (other than those specified in Sections 7.01 and 7.02 above,
------------- ----
in clauses (a) and (b) of this Section 7.03 or in Section 6.24), and such
------------ ------------
failure in any case shall continue unremedied or unwaived for a period of 30
days after the Borrower or such Loan Party receives written notice thereof from
the Administrative Agent; provided, however, if, with respect to this clause
-------- -------
(c), (i) such failure cannot be cured within such 30 day period despite the
Borrower's or such Loan Party's best efforts to do so, (ii) such failure is
susceptible of cure, (iii) the Borrower or such other Loan Party is continuously
proceeding with diligence and in good faith to cure such failure and (iv) the
existence of such failure has not had and could not reasonably be expected to
have a Material Adverse Effect, then such 30 day cure period shall be extended
to such date, not to exceed a 90 day cure period in the aggregate, as shall be
necessary for the Borrower or such other Loan Party to cure such failure.
SECTION 7.04. Involuntary Bankruptcy Proceeding, Etc. An involuntary
--------------------------------------
proceeding shall be commenced or an involuntary petition shall be filed seeking
(a) liquidation, reorganization or other relief in respect of (i) the Borrower,
(ii) any Subsidiary, (iii) any
94
Shareholder, (iv) prior to the Commercial Operation Date, a System Contractor or
a Supply Contract Guarantor or (v) any other counterparty to the System
Contracts (other than the Capacity Sales Agreements) or, in any such case, its
debts, or a substantial part of its assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect
or (b) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the (i) Borrower, (ii) any Subsidiary, (iii)
any Shareholder, (iv) prior to the Commercial Operation Date, a System
Contractor or a Supply Contract Guarantor or (v) any other Obligor or any other
counterparty to the System Contracts (other than the Capacity Sales Agreements)
or for a substantial part of its assets, and, in any such case, such proceeding
or petition shall continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall be entered; provided that, with
--------
respect to a System Contractor, such proceeding shall not constitute an Event of
Default hereunder so long as (A) the applicable Supply Contract has not been
terminated or rejected and such System Contractor is continuing to diligently
perform its obligations under the applicable Supply Contract or (B) the
applicable Supply Contract Guarantor has not suffered any of the events
described above and is diligently performing its obligations under the
applicable Supply Contract Guarantee, and provided further that, with respect
-------- -------
to any other counterparty to a System Contract, such proceeding shall not
constitute an Event of Default hereunder so long as such event could not
reasonably be expected to have a Material Adverse Effect.
SECTION 7.05. Voluntary Bankruptcy Proceeding, Etc. The Borrower, any
------------------------------------
Subsidiary, any Shareholder, prior to the Commercial Operation Date, a System
Contractor or a Supply Contract Guarantor, or, at any time, any other
counterparty to a System Contract (other than the Capacity Sales Agreements)
shall (a) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect,
(b) consent to the institution of any proceeding or petition described in
Section 7.04, (c) apply for or consent to the appointment of a receiver,
------------
trustee, custodian, sequestrator, conservator or similar official for the (i)
Borrower, (ii) any Subsidiary, (iii) any Shareholder, (iv) prior to the
Commercial Operation Date, a System Contractor or a Supply Contract Guarantor,
or (v) any other counterparty to a System Contract (other than the Capacity
Sales Agreements) or, in each such case, for a substantial part of its assets,
(d) file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (e) make a general assignment for the benefit
of creditors or (f) take any action for the purpose of effecting any of the
foregoing, provided that, with respect to a System Contractor, any such event or
--------
action shall not constitute an Event of Default hereunder so long as (A) the
applicable Supply Contract has not been terminated or rejected and such System
Contractor is continuing to diligently perform its obligations under the
applicable Supply Contract or (B) the applicable Supply Contract Guarantor has
not taken any of the actions described above and is diligently performing its
obligations under the applicable Supply Contract Guarantee; and provided further
-------- -------
that, with respect to any other counterparty to a System Contract, such
proceeding shall not constitute an Event of Default hereunder so long as such
event could not reasonably be expected to have a Material Adverse Effect.
SECTION 7.06. Judgments. One or more final judgments (a) for the payment
---------
of money in an aggregate amount (not paid or covered by insurance) in excess of
$5,000,000 shall
95
be rendered against the Borrower or any Subsidiary, and, in each case, the same
shall not have been vacated, discharged, stayed or bonded pending appeal within
60 days from the entry thereof or (b) shall be entered in the form of an
injunction or similar form of relief requiring suspension or abandonment of the
construction, installation or operation of the System and such injunction or
similar relief shall not have been stayed, discharged or vacated within 60 days.
SECTION 7.07. ERISA. An ERISA Event shall have occurred that, in the
-----
opinion of the Required Lenders, when taken together with all other ERISA Events
that have occurred, could reasonably be expected to have a Material Adverse
Effect.
SECTION 7.08. Impairment of Security, Etc. Any Loan Document shall cease
---------------------------
to be in full force and effect or the Borrower or any Loan Party shall so assert
in writing; or the Lien as to any material portion of the Collateral created by
any Security Document shall cease to be enforceable or, in the case of
Perfectible Collateral, of the same effect and priority purported to be created
thereby; or a Supply Contract Guarantee shall cease to be in full force and
effect (except as a result of the express provisions thereof) or such Supply
Contract Guarantor shall so assert in writing.
SECTION 7.09. Commercial Operation. The Commercial Operation Date shall
--------------------
not have occurred by the Guaranteed Completion Date.
SECTION 7.10. Impairment of System Contract. Any System Contract (other
-----------------------------
than a Capacity Sales Agreement) shall cease to be valid and binding and in full
force and effect, other than, except with respect to a Supply Contract and a
Supply Contract Guarantee, as contemplated by the terms of Section 6.07;
------------
provided that, with respect to any such System Contract (other than a Supply
--------
Contract Guarantee and, unless a Supply Contract is being replaced in accordance
with Section 7.11, the related Contractor Consent, as to which the following
------------
provision shall not be applicable), an Event of Default shall not occur under
this Section so long as such event is cured by the Borrower by replacing such
System Contract with the consent of the Majority Lenders (such consent not to be
unreasonably withheld or delayed) within 60 days of the occurrence of such
event.
SECTION 7.11. Default Under System Contract. (a) Any party to any System
-----------------------------
Contract (other than a Capacity Sales Agreement and a Supply Contract) shall be
in material default thereunder and, other than with respect to a Supply Contract
Guarantee, such default shall continue unremedied for 30 consecutive days and
such default could reasonably be expected to have a Material Adverse Effect,
unless such System Contract (together with the related Consent, if any, in
respect thereof) has been replaced with the consent of the Majority Lenders
within 60 days of such default (such consent not to be unreasonably withheld or
delayed); (b) prior to the date of System Final Completion, an "Event of
Default" shall have occurred and be continuing under a Supply Contract, unless
such Supply Contract has been replaced with the prior written consent of the
Majority Lenders within 60 days of such event (such consent not to be
unreasonably withheld or delayed) or the related Supply Contract Guarantor is
diligently performing its obligations under the related Supply Contract
Guarantee and has cured such "Event of Default" within such 60-day period, it
being understood that a failure of the Contractor
96
to achieve the Commercial Operation Date by the Scheduled RFS Date shall not
constitute an Event of Default under this Section so long as the Commercial
Operation Date occurs by the Guaranteed Completion Date; or (c) if any Tranche
A-2 Term Loan has been made, at any time prior to First Permitted Upgrade Final
Completion, an "Event of Default" under the Alcatel Supply Contract shall have
occurred and be continuing with respect to the Contractor's performance of the
First Permitted Upgrade, and such event could reasonably be expected to have a
Material Adverse Effect.
SECTION 7.12. Liquidated Damages. Any System Contractor shall fail to pay
------------------
when due any amounts owing as liquidated damages under any Supply Contract
(unless the relevant Supply Contract Guarantor is duly performing its
obligations under the its Supply Contract).
SECTION 7.13. Revocation of Landing License, Etc. Any Landing License or
----------------------------------
other Governmental Action which shall at the time be necessary for the
performance of any material System Activity in a manner contemplated under the
Loan Documents and the System Contracts shall be revoked or shall otherwise
terminate (or shall be amended or modified in a materially adverse manner) and
such revocation or termination (or such amendment or modification thereof) could
reasonably be expected to have a Material Adverse Effect, unless such Landing
License or other Governmental Action is replaceable and is replaced with the
prior written consent of the Majority Lenders (such consent not to be
unreasonably withheld or delayed) with an alternative Landing License or other
Governmental Action permitting the performance of such System Activity within 60
days of the occurrence of such event.
SECTION 7.14. Change in Control. A Change in Control shall occur.
-----------------
SECTION 7.15. Default on Other Indebtedness. The Borrower or any
-----------------------------
Subsidiary shall (a) default in any payment of principal of or interest on any
Indebtedness (other than Indebtedness under the Loan Documents) or in the
payment of any obligations under Hedging Agreements, in any case in an aggregate
amount in excess of $2,500,000, beyond the period of grace, if any, provided in
the instrument or agreement under which such Indebtedness was created or (b)
default in the performance of any other agreement relating to such Indebtedness
or contained in any instrument or agreement evidencing, securing or relating
thereto, in each case beyond the period of grace, if any, provided therein, or
any other event shall occur or condition exist, the effect of which default or
other event or condition is to cause, or permit the holders of such Indebtedness
to cause, such Indebtedness to become due prior to its stated maturity.
SECTION 7.16. Delay in Construction or Installation. The construction or
-------------------------------------
installation of the System shall be suspended under any Supply Contract for more
than 60 days or the System (or any Segment thereof) shall be abandoned by the
Borrower.
SECTION 7.17. Limitations Regarding St. Croix Affiliate. The St. Croix
-----------------------------------------
Affiliate engages in any activity (including the incurrence of Indebtedness or
Liens) in violation of its charter restriction contemplated by Section 4.02 (p)
----------------
or amends its charter with respect thereto, in each case without the consent of
the Majority Lenders, provided, however, that the foregoing shall not be an
-------- -------
Event of Default if (a) such Indebtedness and Liens relate to an amount which is
97
less than $1,000,000 in the aggregate and (b) the incurrence of such
Indebtedness or Liens could not reasonably be expected to have a Material
Adverse Effect.
SECTION 7.18. Limitations Regarding Global Networks. Global Networks
-------------------------------------
ceases to be a 100% wholly owned direct or indirect subsidiary of Global
Crossing.
SECTION 7.19. Remedies. If any Event of Default described in Sections 7.04
-------- -------------
or 7.05 shall occur with respect to the Borrower or any Subsidiary, the
----
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become
immediately due and payable, without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower.
If any Event of Default (other than any Event of Default described in
Section 7.04 or 7.05 with respect to the Borrower or any Subsidiary) shall occur
------------ ----
for any reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent may, and at the request or with the consent of the Majority
Lenders shall, by notice to the Borrower, take any or all of the following
actions, at the same or different times: (a) terminate the Commitments, and
thereupon the Commitments shall terminate immediately, (b) declare the Loans
then outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower and (c) exercise such other
rights or remedies as the Lenders may have under the Loan Documents, the
Consents or applicable law.
ARTICLE VIII.
THE ADMINISTRATIVE AGENT, OTHER AGENTS
AND AGENT RELATED PERSONS
-------------------------
SECTION 8.01. Authorization and Action. Each Lender hereby appoints and
------------------------
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers and discretion under this Agreement as are delegated
to the Administrative Agent by the terms hereof, together with such powers and
discretion as are reasonably incidental thereto. As to any matters not expressly
provided for by this Agreement (including enforcement or collection of the
Notes), the Administrative Agent (or trustee under any of the Loan Documents, as
applicable) shall not be required to exercise any discretion or take any action,
but shall be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the instructions of the
Majority Lenders, the Required Lenders or the Lenders, as the case may be, for
actions or refraining from acting pursuant to the terms of this Agreement and
such instructions shall be binding upon all Lenders and all holders of Notes;
provided, however, that the Administrative Agent (or trustee under any of the
-------- -------
Loan Documents, as applicable) shall not be required to take any action that
exposes the Administrative Agent (or trustee under any of the Loan Documents, as
applicable) to personal liability (unless indemnified
98
to its reasonable satisfaction) or that is contrary to this Agreement or
applicable law. The Administrative Agent agrees to give to each Lender prompt
notice of each notice given to it by the Borrower or any Subsidiary pursuant to
the terms of this Agreement.
SECTION 8.02. Exculpation of, and Reliance by, Agents and Agent Related
---------------------------------------------------------
Persons.
-------
Neither the Administrative Agent (including in its capacity as trustee under any
of the Loan Documents or otherwise) nor any other Agent nor any Agent Related
Person shall be liable to any Lender for any action taken or omitted to be taken
by it or them under or in connection with this Agreement, any other Loan
Document or any Consent, except for its or their own gross negligence or willful
misconduct. Without limiting the generality of the foregoing, the
Administrative Agent (including in its capacity as trustee under any of the Loan
Documents or otherwise) and each Agent Related Person:
(a) may treat the payee of any Note as the holder thereof or any
Lender as a Lender until the Administrative Agent receives and accepts an
Assignment and Acceptance entered into by such payee or Lender, as assignor, and
an eligible assignee, as assignee, as provided in Section 9.04;
------------
(b) may consult with legal counsel (including counsel for the
Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts;
(c) makes no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, warranties or representations
(whether written or oral) made in or in connection with this Agreement, any
other Loan Document or any Consent;
(d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement, any other Loan Document or any Consent, on the part of the Borrower
or any Subsidiary, or to inspect the property (including the books and records)
of the Borrower or any Subsidiary;
(e) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported to
be created under or in connection with, this Agreement or any other instrument
or document furnished pursuant hereto;
(f) shall incur no liability to any Lender under or in respect of this
Agreement, any other Loan Document or any Consent, by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telecopier,
telegram, or telex) believed by it to be genuine and signed or sent by the
proper party or parties; and
(g) shall not be under any obligation to hold any title deeds, Loan
Documents or any other documents in connection with any property the subject of
a Lien under any Loan Document or any other security in its possession, or to
take any steps to protect or preserve the
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same and may permit the relevant Loan Party to retain all such title deeds, Loan
Documents and other documents in its possession, except as otherwise provided in
the Loan Documents.
SECTION 8.03. Agents, Agent Related Persons and Affiliates. With respect
--------------------------------------------
to its Commitment, the Credit Extensions made by it and any Note issued to it,
Deutsche Bank AG and CIBC Inc., and their respective Affiliates shall have the
same rights and powers under this Agreement as any other Lender and may exercise
the same as though it were not an Agent; and the term "Lender" or "Lenders"
shall, unless otherwise expressly indicated, include Deutsche Bank AG and CIBC
Inc. and any Affiliate thereof in its individual capacity. Deutsche Bank AG and
CIBC Inc. and their Affiliates may accept deposits from, lend money to, act as
trustee under indentures of, accept investment banking engagements from and
generally engage in any kind of business with, the Borrower, any Subsidiary and
any Person who may do business with or own securities of the Borrower or any
such Subsidiary, all as if Deutsche Bank AG and CIBC Inc. and their Affiliates
were not an Agent and without any duty to account therefor to the Lenders.
SECTION 8.04. Lender Credit Decision. Each Lender acknowledges that it
----------------------
has, independently and without reliance upon any Agent or Agent Related Person
or any other Lender and based on the financial statements referred to in
Section 3.01 and such other documents and information as it has deemed
------------
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon any Agent or Agent Related Person or any other Lender based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement.
SECTION 8.05. Indemnification. The Lenders agree to indemnify each Agent
---------------
and Agent Related Person (to the extent not reimbursed by the Borrower or a
Subsidiary), ratably according to the respective principal amounts of the Loans
owing to them, and Commitments issued by them, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against such Agent or Agent Related Person
in any way relating to or arising out of this Agreement, any other Loan Document
or any Consent or any action taken or omitted by such Agent or Agent Related
Person under this Agreement, any other Loan Document or any Consent, provided
--------
that no Lender shall be liable to any Agent or Agent Related Person for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such Agent's
or Agent Related Person's gross negligence or willful misconduct. Without
limiting the foregoing, each Lender agrees to reimburse each Agent and Agent
Related Person promptly upon demand for its ratable share of any out-of-pocket
expenses (including counsel fees) incurred by such Agent or Agent Related Person
in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that such Agent or Agent
Related Person is not reimbursed for such expenses by the Borrower or any
Subsidiary.
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SECTION 8.06. Collateral Matters. (a) The Administrative Agent (including
------------------
in its capacity as trustee under any of the Loan Documents or otherwise) is
authorized on behalf of all the Lenders, without the necessity of any notice to
or further consent from the Lenders, from time to time to take any action with
respect to any collateral security or the Security Documents which may be
necessary to perfect and maintain perfected the security interest in and Liens
upon the collateral security granted pursuant to the Security Documents.
(b) The Lenders irrevocably authorize the Administrative Agent
(including in its capacity as trustee under any of the Loan Documents or
otherwise), at its option and in its discretion, to release (i) any security
interest or Lien granted to or held by it upon any collateral security (A) upon
termination of the Commitments and payment in full in cash of all principal of
and interest on the Loans and all fees, costs, indemnities, gross-ups and
expenses that are payable under this Agreement or under any other Loan Document
and have been invoiced as of such termination date (in which case the Lenders
hereby authorize the Administrative Agent (or trustee under any of the Loan
Documents, as applicable) to execute, and the Administrative Agent (or trustee
under any of the Loan Documents, as applicable) agrees to execute, reasonable
releases in connection with this Agreement and the Loan Documents (other than,
in any event, as to items stated to survive the termination of this Agreement or
a Loan Document)); (B) constituting property sold or to be sold or disposed of
as part of or in connection with any disposition permitted hereunder; (C)
constituting property in which the Borrower or any Subsidiary owned no interest
at the time the security interest and/or Lien was granted or at any time
thereafter; (D) consisting of an instrument evidencing Indebtedness or other
debt instrument, if the Indebtedness evidenced thereby has been paid in full; or
(E) if approved, authorized or ratified in writing by the Majority Lenders or,
if required by Section 9.02, the Required Lenders or each Lender, as applicable,
------------
and (ii) any guarantor from its obligations under any Guaranty constituting a
Loan Document in the event such guarantor is not required to be a guarantor
pursuant to the terms of this Agreement. Upon request by the Administrative
Agent (or trustee under any of the Loan Documents, as applicable) at any time,
the Lenders will confirm in writing the such party's authority to release
particular types or items of collateral security or a Guaranty pursuant to this
Section.
(c) Except as otherwise provided in the Loan Documents, all moneys
which under any trusts therein contained are received by the Administrative
Agent in its capacity as trustee may, subject to the terms hereof, be invested
in the name of or under the control of the Administrative Agent in any
investment for the time being authorized by English law for the investment by
trustees of trust money or in any other investments which may be selected by the
Administrative Agent. Additionally the same may be placed on deposit in the name
of or under the control of the Administrative Agent at such bank or institution
(including the Administrative Agent) and upon such terms as the Administrative
Agent may think fit.
(d) Each Lender hereby confirms its approval of the Loan Documents
and any security created or to be created pursuant thereto and hereby
authorizes, empowers and directs the Administrative Agent (by itself or by such
person(s) as it may nominate) to execute and enforce the same as trustee or as
otherwise provided (and whether or not expressly in the Lender's names) on its
behalf.
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SECTION 8.07. Successor Administrative Agent. The Administrative Agent may
------------------------------
resign at any time by giving 30 days' written notice thereof to the Lenders and
the Borrower and may be removed at any time with or without cause by the
Majority Lenders. Upon any such resignation or removal, the Majority Lenders
shall have the right to appoint a successor Administrative Agent with the prior
written consent of the Borrower (not to be unreasonably withheld or delayed) so
long as no Event of Default has occurred and is continuing. If no successor
Administrative Agent shall have been so appointed by the Majority Lenders, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Majority Lenders'
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Lenders, appoint, with the prior written consent of
the Borrower (not to be unreasonably withheld or delayed) so long as no Event of
Default has occurred and is continuing, a successor Administrative Agent which
shall be a Lender or a commercial bank organized under the laws of the United
States of America or of any State thereof and having a combined capital and
surplus of at least $250,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, discretion, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations under this Agreement. After any retiring
Administrative Agent's resignation or removal hereunder as Administrative Agent,
the provisions of this Article VIII shall inure to its benefit as to any actions
------------
taken or omitted to be taken by it while it was Administrative Agent under this
Agreement.
ARTICLE IX.
MISCELLANEOUS
-------------
SECTION 9.01. Notices. Except in the case of notices and other
-------
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at Wessex House, 00 Xxxx Xxxxxx,
Xxxxxxxx, Xxxxxxx XX00, Attention of Mid-Atlantic Crossing Ltd., Vice President
(Telecopy No. 441-296-6749);
(b) if to the Administrative Agent, to it at 00 Xxxx 00xx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention of Xxxxx Xxxxxxxxx (Telecopy No. 212-469-8256);
(c) if to a Lead Agent (i) in the case of Deutsche Bank AG, New York
Branch, to it at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of
Xxxx Xxxxx (Telecopy No. 212-469-3713) and (ii) in the case of CIBC Inc., to it
at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxxxxxxx
Xxxxxxxx (Telecopy No. 212-856-3562); and
102
(d) if to any other Lender, to it at its address (or telecopy number)
set forth on Schedule 2.01.
-------------
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given (a) to the Borrower or any Subsidiary in accordance
with the terms of this Agreement shall be deemed to have been given when sent
(answerback received) in the case of telecopy, when delivered, in the case of
hand or overnight courier service, and 5 days after mailing, in the case of
certified or registered mail, or (b) to any party hereto in accordance with the
terms of this Agreement other than for purposes of the immediately preceding
clause (a), shall be deemed to have been given on the date of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
-------------------
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement, any other Loan Document or any Consent or
consent to any departure by the Borrower or any Subsidiary therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default, regardless of whether the Administrative Agent or any
Lender may have had notice or knowledge of such Default at the time.
(b) Subject to Sections 5.4.2 and 5.4.3 of the Securities Accounts
-------------- -----
Agreement, neither this Agreement, any other Loan Document, any Consent nor any
provision hereof or thereof may be waived, amended or modified except pursuant
to an agreement or agreements in writing entered into by the Loan Parties
thereto and the Majority Lenders or by such Loan Parties and the Administrative
Agent with the consent of the Majority Lenders (unless expressly provided
otherwise in this Agreement); provided that no such agreement shall (i) increase
--------
the Commitment of any Lender without the written consent of such Lender, (ii)
reduce the principal amount of any Loan or reduce the rate of interest thereon,
or reduce any fees payable hereunder, without the written consent of each Lender
affected thereby, (iii) postpone the scheduled date of payment of the principal
amount of any Loan, or any interest thereon, or any fees payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender affected thereby, (iv) change Section 2.17(b) or (c) in a manner
--------------- ---
that would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender, (v) amend Section 2.10(b) of this Agreement,
---------------
Section 2.7.3(a) of the Securities Accounts Agreement or Section 2.7.4(a) of the
---------------- ----------------
Securities Accounts Agreement without the consent of the Required Lenders, (vi)
change any of the provisions of this Section or the definition of "Required
Lenders," "Majority Lenders" or any other provision hereof specifying the number
or percentage
103
of Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder or (vii) release all or
substantially all of the Collateral (other than in accordance with the terms of
the Security Documents) or release any guarantor from its obligations under a
guaranty (other than in accordance with the provisions thereof), without the
written consent of each Lender; provided further that no such agreement shall
-------- -------
amend, modify or otherwise affect the rights or duties of the Administrative
Agent hereunder without the prior written consent of the Administrative Agent.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower shall
----------------------------------
pay (i) all reasonable out-of-pocket expenses incurred by the Agents, the Lead
Agents, and their respective Affiliates, including the reasonable fees, charges
and disbursements of one documentation counsel for the Agents and the Lead
Agents and their respective Affiliates, in connection with the syndication of
the credit facilities provided for herein, the preparation of the Commitment
Letter dated as of June 26, 1998 and August 13, 1998, among the Borrower, CIBC
Xxxxxxxxxxx Corp. and Deutsche Bank Securities Inc. and the Commitment Letter
dated as of May 29, 1998, among the Borrower, CIBC Xxxxxxxxxxx Corp. and CIBC
Inc., this Agreement and the other Loan Documents, and any amendments,
modifications or waivers of the provisions hereof and of any other Loan Document
(whether or not the transactions contemplated hereby or thereby shall be
consummated) and the reasonable fees, charges and disbursements of one counsel
for the Agents and the Lead Agents and their respective Affiliates in connection
with the ongoing consideration of legal matters relevant to any of the
foregoing, including the ongoing compliance with this Agreement and the security
relating hereto and thereto, (ii) the reasonable fees and expenses of any local
counsel retained by the Administrative Agent, (iii) the reasonable fees and
expenses of the Consultants in connection with the preparation of their reports
and the ongoing fees and expenses of the Independent Engineer, (iv) any expenses
the Borrower or any Subsidiary specifically agrees to pay pursuant to any
provision of the Loan Documents and (v) all reasonable out-of-pocket expenses
incurred by the Agents or any Lender, but only in connection with the
enforcement or protection of its rights or remedies in connection with this
Agreement and the Loan Documents, including its rights under this Section, or in
connection with the Loans made hereunder, including in connection with any
workout, restructuring or negotiations in respect thereof, provided that with
--------
respect to legal fees, the Borrower shall be responsible to pay only the
reasonable fees and expenses of one or more counsel selected by the
Administrative Agent for the benefit of itself, the Lead Agents, the other
Agents, the Lead Agents, the Lenders and their respective Affiliates. Other than
as set forth above, the Administrative Agent, the Lead Agents and the Lenders
shall be responsible for their own expenses, including ongoing administration
expenses (which the Administrative Agent's fee is intended to cover) and
expenses incurred in connection with assignments. With respect to out-of-pocket
expenses incurred in connection with amendments, modifications or waivers to
this Agreement or the Loan Documents and in connection with the ongoing
consideration of legal matters relevant to this Agreement and the other Loan
Documents (except for matters relating to the enforcement or protection of
rights or remedies and except when an Event of Default has occurred and is
continuing) the Administrative Agent agrees to confer with the Borrower in
advance of the incurrence of any such expenses.
104
(b) The Borrower shall indemnify the Administrative Agent, the Lead
Agents and each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an "Indemnitee") against, and shall hold each
----------
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses (subject, in the case of ordinary expenses, to the provisions
of Section 9.03(a)), including the fees, charges and disbursements of any
---------------
counsel for any Indemnitee, incurred by or asserted against any Indemnitee
arising out of, in connection with, or as a result of (i) the execution or
delivery of this Agreement or any agreement or instrument contemplated hereby,
the performance by the parties hereto of their respective obligations hereunder
or the consummation of the transactions contemplated hereby, (ii) any presence
or release of Hazardous Materials on or from any property owned or operated by
the Borrower or any Subsidiary, or any Environmental Liability related in any
way to the Borrower or any Subsidiary, (iii) the use by the Lead Agents of the
syndication materials (whether or not such materials were provided by the
Borrower) or (iv) any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
--------
the extent that such losses, claims, damages, liabilities or related expenses
resulted from the gross negligence or willful misconduct of such Indemnitee or
relate to a claim brought by an assignee or Participant against the Lender
making such assignment or participation. If for any reason the foregoing
indemnification is unavailable to any Indemnitee or is insufficient to hold it
harmless, then the Borrower shall contribute to the amount paid or payable by
such Indemnitee as a result of such loss, claim, damage, liability or related
expense in such proportion as is appropriate to reflect the relative economic
interests of the Borrower and the Shareholders on the one hand and such
Indemnitee on the other hand in the transactions contemplated hereby as well as
the relative fault of the Borrower and such Indemnitee with respect to such
loss, claim, damage or liability and any other relevant equitable
considerations.
(c) Each Indemnitee claiming any right to indemnity under paragraph
(b) of this Section by reason of the institution of any action against such
Indemnitee shall notify the Borrower thereof and shall consult with the Borrower
from time to time in connection with the defense of such action. In case any
such action shall be brought against such Indemnitee, the Borrower shall be
entitled, at its expense, to assume the defense thereof or to participate in
such action with counsel of its choice (which counsel shall be reasonably
satisfactory to such Indemnitee); provided that the Borrower may not settle any
--------
such action without the prior written consent of such Indemnitee (such consent
not to be unreasonably withheld or delayed) and the Borrower shall not be
entitled to assume the defense thereof if (i) such Indemnitee reasonably
determines, on the advice of counsel, that representation of both the Borrower
and such Indemnitee by the Borrower's counsel would present such counsel with a
conflict of interest, (ii) the defendants in, or targets of, any such action
include both such Indemnitee and the Borrower, and such Indemnitee shall have
reasonably concluded, on advice of counsel, that there may be legal defenses
available to it which are significantly different from those available to the
Borrower, (iii) the Borrower shall not have employed counsel satisfactory to
such Indemnitee to represent such Indemnitee within a reasonable time after
notice of the institution of any such action or (iv) such Indemnitee is faced
with potential criminal liability.
105
SECTION 9.04. Successors and Assigns; Consent and Agreement. (a) The
---------------------------------------------
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby,
except that the Borrower may not assign or otherwise transfer any of its rights
or obligations hereunder without the prior written consent of each Lender (and
any attempted assignment or transfer by the Borrower without such consent shall
be null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Agent Related Parties and Related Parties of the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement. All Lenders now or hereafter parties to this Agreement hereby
agree to be bound by the terms of the Contractor Consents to the same extent as
the Administrative Agent.
(b) Any Lender may assign to one or more assignees (other than to the
Borrower, any Subsidiary or any of its Affiliates) all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it) and the other Loan Documents;
provided that (i) except in the case of an assignment to a Lender or an
--------
assignment solely of a Lender's rights or benefits under the Loan Documents to
an Affiliate of any Lender or, with respect to any Lender that is a fund that
invests in bank loans, to an Approved Fund, no such assignment shall be
permitted without the prior written consent of each of the Borrower and the
Administrative Agent (which shall not be unreasonably withheld), (ii) except in
the case of an assignment to a Lender or an Affiliate of a Lender or, with
respect to any Lender that is a fund that invests in bank loans, to an Approved
Fund, or an assignment of the entire remaining amount of the assigning Lender's
Commitment, the amount of the Commitment of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall not
be less than $5,000,000 unless each of the Borrower and the Administrative Agent
otherwise consent (which consent shall not be unreasonably withheld), (iii) each
partial assignment shall be made as an assignment of a proportionate part of all
the assigning Lender's rights and obligations under this Agreement, (iv) the
parties to each assignment shall execute and deliver to the Administrative Agent
an Assignment and Acceptance for its acceptance and recording in the Register,
together with a processing and recordation fee of $3,500 (which shall be paid by
the assignor and/or assignee but not the Borrower), (v) the assignee shall not,
as of the effective date of such assignment, be entitled to receive any greater
payment under Section 2.14 or 2.16 than the assigning Lender shall be entitled
------------ ----
to receive with respect to the obligations sold and (vi) notwithstanding
anything to the contrary in this Section 9.04(b), unless an Event of Default
---------------
shall have occurred and be continuing, the Lead Agents, collectively, shall
retain a combination of Loan Commitments and principal amount of Loans in an
amount not less than the lesser of (x) $20,000,000 in the aggregate and (y) 10%
(or such other percentage as may be agreed upon by the Lead Agents and the
Borrower) of the total amount of Loan Commitments and Loans than outstanding
unless the Borrower shall otherwise consent (such consent not to be unreasonably
withheld), provided that all or any portion of such Loan Commitments and the
--------
Loans made thereunder may be held by the Lead Agents as lenders of record only.
Upon acceptance and recording pursuant to paragraph (d) of this Section, from
and after the effective date specified in each Assignment and Acceptance, the
assignee thereunder
106
shall be a party hereto and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto). Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not
comply with this paragraph shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations in
accordance with paragraph (e) of this Section.
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices in The City of New York a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders and the registered
owner(s) of any obligation evidenced by a Note, and the Commitment of, and
principal amount of the Loans owing to, each Lender pursuant to the terms hereof
from time to time (the "Register"). The Notes and the obligations evidenced
--------
thereby may be assigned or otherwise transferred in whole or in part only by
registration in the Register and the Note evidencing the same shall be
registered on the Register only upon surrender for registration of assignment or
transfer of the Note evidencing such obligation, duly endorsed by (or
accompanied by a written instrument of assignment or transfer duly executed by)
the registered owner thereof, and thereupon one or more new Note(s) in the same
aggregate principal amount shall be issued to the designated assignee(s) and the
old Notes shall be returned by the Administrative Agent to the Borrower marked
"canceled." No assignment of any Note or obligation evidenced thereby shall be
effective unless it has been recorded in the Register as provided in this
Section 9.04(c). The entries in the Register shall be conclusive, and the
---------------
Borrower, the Administrative Agent and the Lenders may treat each Person whose
name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the processing and recordation
fee referred to in paragraph (b) of this Section, evidence of such assignee's
exemption from withholding Taxes and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall accept
such Assignment and Acceptance and record the information contained therein in
the Register. No assignment shall be effective for purposes of this Agreement
unless it has been recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of the Borrower, the
Administrative Agent, or the Lead Agents, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such Lender's
-----------
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (i) such Lender's
--------
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (iii) the Borrower, the Administrative Agent, the Lead
Agents and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations
107
under this Agreement. Any agreement or instrument pursuant to which a Lender
sells such a participation shall provide that such Lender shall retain the sole
right to enforce this Agreement and to approve any amendment, modification or
waiver of any provision of this Agreement. Subject to paragraph (f) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were a
------------- ---- ----
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.14, 2.15 or 2.16 than the applicable Lender would have been
------------ ---- ----
entitled to receive with respect to the participation sold to such Participant,
and any such payment received by a Participant shall be in lieu of, and not
duplicative of, the comparable payment that would have been due to such
applicable Lender. A Participant shall not be entitled to the benefits of
Section 2.16 unless the Borrower is notified of the participation sold to such
------------
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with the provisions of Section 2.16(e) as though it were a Lender.
---------------
(g) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any such pledge or assignment to a Federal Reserve Bank,
and this Section shall not apply to any such pledge or assignment of a security
interest; provided that no such pledge or assignment of a security interest
--------
shall release a Lender from any of its obligations hereunder or substitute any
such assignee for such Lender as a party hereto.
SECTION 9.05. Limited Recourse. There shall be full recourse to the
----------------
Borrower and each Subsidiary for the liabilities of the Borrower and the
Subsidiaries under this Agreement and the other Loan Documents, but in no event
shall any holder of any equity interest in the Borrower (or any officer or
director of such holder or any officer or director of the Borrower or any
Subsidiary, in its capacity as such) be personally liable or obligated for such
liabilities of the Borrower and the Subsidiaries.
SECTION 9.06. Survival. All covenants, agreements, representations and
--------
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, and shall continue in full force and effect as long as the principal of
or any accrued interest on any Loan or any fee or any other amount payable under
this Agreement is outstanding and unpaid and so long as the Commitments have not
expired or terminated. The provisions of Sections 2.14, 2.15, 2.16 and 9.03 and
------------- ---- ---- ----
Article VIII shall survive and remain in full force and effect regardless of the
------------
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Commitments or the termination of
this Agreement or any provision hereof.
SECTION 9.07. Counterparts; Integration; Effectiveness. This Agreement may
----------------------------------------
be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single
108
contract. This Agreement and any agreements referred to herein and any separate
letter agreements with respect to fees payable to an Agent and/or Agent Related
Person constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
------------
executed by the Borrower and the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and, subject to and in accordance with Section 9.04, their respective successors
------------
and assigns. Delivery of an executed counterpart of a signature page of this
Agreement by telecopy shall be as effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 9.08. Severability. Any provision of this Agreement held to be
------------
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 9.09. Right of Setoff. If an Event of Default shall have occurred
---------------
and be continuing, each Lender is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held (other than deposits in the Accounts) and other indebtedness at any time
owing by such Lender to or for the credit or the account of the Borrower against
any of and all the obligations of the Borrower now or hereafter existing under
this Agreement held by such Lender, irrespective of whether or not such Lender
shall have made any demand under this Agreement and although such obligations
may be unmatured. The rights of each Lender under this Section are in addition
to other rights and remedies (including other rights of setoff) which such
Lender may have.
SECTION 9.10. Governing Law; Jurisdiction; Consent to Service of Process.
----------------------------------------------------------
(a) This Agreement shall be construed in accordance with and governed by the
laws of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent permitted by law, in such federal court. Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement
shall affect any right that the Administrative Agent or any Lender may otherwise
have to bring any
109
action or proceeding relating to this Agreement against the Borrower or its
properties in the courts of any jurisdiction.
(c) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any court referred to in
paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
------------
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law. The Borrower shall not object to
receiving service of process in any jurisdiction.
SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
--------------------
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY).
SECTION 9.12. Headings. Article and Section headings and the Table of
--------
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.13. Replacement of Independent Engineer. Any appointment by the
-----------------------------------
Administrative Agent of a replacement engineer to act as the "Independent
Engineer" under the Loan Documents and the System Contracts shall be subject to
the approval of the Borrower, such approval not to be unreasonably withheld or
delayed.
SECTION 9.14. Confidentiality. Each of the Administrative Agent, the Lead
---------------
Agents, any other Agents and the Lenders agrees to maintain the confidentiality
of the Information (as defined below), except that Information may be disclosed
(a) to its and its Affiliates' directors, officers, employees and agents,
including accountants, legal counsel and other advisors (it being understood
that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any governmental or regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement, (g) with the consent of the Borrower (not to be
unreasonably withheld or delayed), (h) to the extent such Information (x)
becomes publicly available other than as a result of a breach of this Section or
(y) becomes
110
available to the Administrative Agent, the Lead Agents or any Lender on a
nonconfidential basis from a source other than the Borrower or (i) to any direct
or indirect contractual counterparties in swap agreements or such contractual
counterparties' professional advisors, provided that such contractual
counterparty or professional advisor to such contractual counterparty agrees in
writing to keep such information confidential to the same extent required of the
Lenders hereunder. For the purposes of this Section, "Information" means all
information received from or on behalf of the Borrower relating to the
------------
Borrower, any Subsidiary, its business or the System, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower; provided that,
--------
in the case of information received from the Borrower after the date hereof,
such information is clearly identified at the time of delivery as confidential.
Any Person required to maintain the confidentiality of Information as provided
in this Section shall be considered to have complied with its obligation to do
so if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.
SECTION 9.15. Right of Quiet Enjoyment. The Administrative Agent and each
------------------------
Lender agrees, for the benefit of each Person not an Affiliate of the Borrower
now or hereafter acquiring rights from the Borrower or any Subsidiary in respect
of any Capacity pursuant to a Capacity Sales Agreement, indefeasible right of
use agreement, or otherwise in accordance with Section 6.23 (a "Capacity
------------ --------
Purchaser"), that, notwithstanding any other provision hereof or any other Loan
----------
Document, so long as no event has occurred and is continuing under such
agreement which entitles the Borrower or a Subsidiary to suspend service to such
Capacity Purchaser, the Administrative Agent and such Lender will not take or
cause to be taken any action to interfere with such Capacity Purchaser's right
to quiet enjoyment. The Administrative Agent agrees to provide, and the Lenders
hereby authorize it to provide, at the written request of the Borrower, a
written confirmation of the foregoing for the benefit of such Capacity
Purchasers.
SECTION 9.16. Judgment Currency. If, for the purposes of obtaining
-----------------
judgment in any court, it is necessary to convert a sum due hereunder in one
currency into another currency, the parties hereto agree, to the fullest extent
permitted by law, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Administrative Agent could
purchase the former currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of the Borrower
in respect of any sum due from it to the Administrative Agent hereunder shall,
notwithstanding any judgment in a currency other than the currency in which such
sum shall have been due, be discharged only to the extent that, on the Business
Day following receipt thereof by the Administrative Agent, the Administrative
Agent may in accordance with normal banking procedures purchase the currency in
which sum was due with such other currency in which judgment was rendered; if
the currency so purchased exceeds the sum originally due to the Administrative
Agent in the former currency, the Administrative Agent agrees to remit to the
Borrower such excess.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
111
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
MID-ATLANTIC CROSSING LTD.
By: /s/ K. Xxxxxx Xxxxxxx
-----------------------------------
Name: K. Xxxxxx Xxxxxxx
Title: Senior Vice President
DEUTSCHE BANK AG, NEW YORK
BRANCH, as a Lead Agent and as
Administrative Agent
By: /s/ Xxxx X. Xxxxx, Xx.
-----------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: Director
By: /s/ Xxx X. Xxxxxx
-----------------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
CIBC INC.,
as a Lead Agent and as Documentation Agent
By: /s/ Xxxx Xxxxx
-----------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
CANADIAN IMPERIAL BANK OF COMMERCE.,
as Syndication Agent
By: /s/ Xxxx Xxxxx
-----------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
[CREDIT AGREEMENT]
LENDERS:
-------
DEUTSCHE BANK AG, NEW YORK
BRANCH AND/OR CAYMAN ISLANDS
BRANCH
By: /s/ Xxxx X. Xxxxx, Xx.
-----------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: Director
By: /s/ Xxx X. Xxxxxx
-----------------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
CIBC INC.
By: /s/ Xxxx Xxxxx
-----------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
[CREDIT AGREEMENT]
BANK OF MONTREAL, CHICAGO BRANCH
By: /s/ X. X. Xxxxxx
-----------------------------------
Name: X. X. Xxxxxx
Title: Managing Director
[CREDIT AGREEMENT]
BAYERISCHE HYPO-UND-VEREINSBANK,
NEW YORK BRANCH
By: /s/ Xxxx X. Xxxxxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Director
By: /s/ Xxxx X. Xxxx
-----------------------------------
Name: Xxxx X. Xxxx
Title: Associate Director
[CREDIT AGREEMENT]
BAYERISCHE LANDESBANK
GIROZENTRALE
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
By: /s/ Xxxxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Vice President
[CREDIT AGREEMENT]
CREDITANSTALT AG
By: /s/ Xxxxxx Xxxxx
-----------------------------------
Name: Xxxxxx Xxxxx
Title: Assistant General Manager
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxx
Title: Deputy Manager
[CREDIT AGREEMENT]
DRESDNER BANK AG NEW YORK & GRAND
CAYMAN BRANCHES
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
By: /s/ Xxxxx Xx
-----------------------------------
Name: Xxxxx Xx, PE
Title: Assistant Vice President
THE GOVERNOR AND COMPANY OF THE
BANK OF SCOTLAND
By: /s/ Xxx Xxxxxxxx Garden
-----------------------------------
Name: Xxx Xxxxxxxx Garden
Title: Director, Project Finance
[CREDIT AGREEMENT]
IKB DEUTSCHE INDUSTRIEBANK AG
LUXEMBOURG BRANCH
By: /s/ Xxxxx Xxxxxxx /s/ Xxxxxxx Ziwey
---------------------------------------------
Name: Xxxxx Xxxxxxx Xxxxxxx Ziwey
Title: Director Sr. Vice President
[CREDIT AGREEMENT]
SUDWESTDEUTSCHE LANDESBANK
GIROZENTRALE
By: /s/ Xxxxxxx Xxxxxxx /s/ Xxxxxx Xxxx
----------------------------------------------
Name: Xxxxxxx Xxxxxxx Xxxxxx Xxxx
Title: Sr. Vice President Sr. Analyst
[CREDIT AGREEMENT]
WESTDEUTSCHE LANDESBANK
GIROZENTRALE
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Managing Director/manager
By: /s/ Xxxxx XxXxxxxx
-----------------------------------
Name: Xxxxx XxXxxxxx
Title: Vice President
[CREDIT AGREEMENT]
