EXHIBIT 10.1
AMENDMENT AGREEMENT
THIS AMENDMENT AGREEMENT (this "Amendment"), dated as of July
28, 1999, is made between FirstCom Equipment, Ltd., a British Virgin Islands
corporation ("Borrower"), and Cisco Systems Capital Corporation , a Nevada
corporation ("Lender").
Borrower and Lender are parties to an Agreement dated as of
November 11, 1998 (the "Credit Agreement"). Borrower has requested that Lender
agree to certain amendments to the Credit Agreement. Lender has agreed to such
request, subject to the terms and conditions hereof.
Accordingly, the parties hereto agree as follows:
SECTION 1 DEFINITIONS; INTERPRETATION.
(a) TERMS DEFINED IN CREDIT AGREEMENT. All capitalized terms
used in this Amendment and not otherwise defined herein shall have the meanings
assigned to them in the Credit Agreement.
(b) INTERPRETATION. The rules of interpretation set forth in
Section 1.3 of the Credit Agreement shall be applicable to this Amendment and
are incorporated herein by this reference.
SECTION 2 AMENDMENTS TO THE CREDIT AGREEMENT.
(a) AMENDMENTS. The Credit Agreement shall be amended as
follows, effective as of the date of satisfaction of the conditions set forth in
Section 4 of this Amendment (the "Effective Date"):
(i) Section 1.1. of the Credit Agreement is hereby amended to
add the following definitions:
"'CONSOLIDATED TOTAL DEBT' means, as of any date of
determination, all Indebtedness of Borrower and its
Subsidiaries on such date, on a consolidated basis
and as determined in accordance with GAAP."
"'EBITDA' means, with respect to any fiscal period of
a Person, such Person's earnings (excluding
extraordinary items (determined in accordance with
GAAP), PLUS (except to the extent attributable to
extraordinary items (determined in accordance with
GAAP)) the amount of any interest, taxes,
depreciation, amortization deducted in arriving at
such earnings, and, without duplication, PLUS losses
and less gains upon dispositions of properties added
or deducted in arriving at such earnings."
1.
(ii) Section 2 of the Credit Agreement is hereby amended to
add the following as Section 2.14:
"2.14 THIRD PARTY FINANCING. In the event that
Borrower obtains any commitment for third party
financing of the project costs proposed to be
financed by Lender, Lender's Commitment hereunder
shall be reduced on a dollar for dollar basis to the
extent of any credit support provided by Lender in
connection therewith (which credit support shall be
on terms acceptable to Lender in its sole
discretion)."
(iii) Section 3.2(b) of the Credit Agreement is hereby amended
to read as follows:
"(b) REPRESENTATIONS AND WARRANTIES; NO DEFAULT. On
the date of such Loan, both before and after giving
effect thereto and to the application of proceeds
therefrom: (i) the representations and warranties
contained in Section 4.1 and in the other Loan
Documents shall be true, correct and complete on and
as of the date of such Loan as though made on and as
of such date; and (ii) no Default shall have occurred
and be continuing or shall result from the making of
such Loan. For purposes of this Section 3.2, clause
(i) shall take into account any amendments to any
disclosures made in writing by Borrower and any
Guarantor to Lender after the initial Borrowing Date
and approved by Lender. The giving of any notice of
borrowing and the acceptance by Borrower of the
proceeds of each Loan made following the initial
Borrowing Date shall each be deemed a certification
to Lender that on and as of the date of such Loan
such statements are true. Upon the request of Lender,
Borrower shall deliver to Lender a certificate of the
secretary or other appropriate officer of Borrower,
dated as of the Borrowing Date, or a date not more
than five (5) Banking Days prior to the applicable
Borrowing Date, certifying the representations,
warranties and statements described in this
subsection (b)."
(iv) Section 3.2 of the Credit Agreement is hereby amended by
adding the following as new subsection (d):
"(d) FINANCIAL CONDITIONS.
(i) MINIMUM TOTAL REVENUES. On a consolidated basis,
Borrower and its Subsidiaries shall not fail to
maintain total revenues of the Borrower and its
Subsidiaries in existence as of the Borrowing Date
for each quarterly period set forth below of not less
than the correlative amount indicated:
2.
---------------------------------------- ---------------------------------------
QUARTERLY PERIOD ENDING REQUIRED AMOUNT
---------------------------------------- ---------------------------------------
June 30, 1999 $10,076,000
---------------------------------------- ---------------------------------------
September 30, 1999 $11,029,000
---------------------------------------- ---------------------------------------
December 31, 1999 $17,677,000
---------------------------------------- ---------------------------------------
March 31, 2000 $24,937,000
---------------------------------------- ---------------------------------------
June 30, 2000 $27,431,000
---------------------------------------- ---------------------------------------
September 30, 2000 $31,172,000
---------------------------------------- ---------------------------------------
December 31, 2000 $41,147,000
---------------------------------------- ---------------------------------------
March 31, 2001 $48,236,000
---------------------------------------- ---------------------------------------
(ii) MINIMUM EBITDA. On a consolidated basis,
Borrower and its Subsidiaries shall not fail to
maintain EBITDA for each quarterly period set forth
below of not less than the correlative amount
indicated (bracketed amounts (< >) are negative):
---------------------------------------- ---------------------------------------
QUARTERLY PERIOD ENDING REQUIRED AMOUNT
---------------------------------------- ---------------------------------------
June 30, 1999 [N/A]
---------------------------------------- ---------------------------------------
September 30, 1999 ($ 1,826,000)
---------------------------------------- ---------------------------------------
December 31, 1999 $ 1,371,000
---------------------------------------- ---------------------------------------
March 31, 2000 $ 6,269,000
---------------------------------------- ---------------------------------------
June 30, 2000 $ 6,895,000
---------------------------------------- ---------------------------------------
September 30, 2000 $ 7,835,000
---------------------------------------- ---------------------------------------
December 31, 2000 $10,343,000
---------------------------------------- ---------------------------------------
March 31, 2001 $15,844,000
---------------------------------------- ---------------------------------------
(iii) MAXIMUM TOTAL DEBT TO CAPITALIZATION. On a
consolidated basis, Borrower and its Subsidiaries
shall not permit the ratio of Consolidated Total Debt
to Capitalization to exceed the percentage amount set
forth below (determined as of the end of quarterly
period set forth below):
---------------------------------------- ---------------------------------------
QUARTERLY PERIOD ENDING PERCENTAGE
---------------------------------------- ---------------------------------------
June 30, 1999 78%
---------------------------------------- ---------------------------------------
September 30, 1999 76%
---------------------------------------- ---------------------------------------
December 31, 1999 75%
---------------------------------------- ---------------------------------------
March 31, 2000 76%
---------------------------------------- ---------------------------------------
June 30, 2000 76%
---------------------------------------- ---------------------------------------
September 30, 2000 76%
---------------------------------------- ---------------------------------------
December 31, 2000 76%
---------------------------------------- ---------------------------------------
March 31, 2001 76%
---------------------------------------- ---------------------------------------
(iv) MINIMUM CASH REQUIREMENTS. On a consolidated
basis, Borrower and its Subsidiaries shall at all
times maintain minimum cash (including cash
equivalents and restricted cash) of at least
$1,500,000."
3.
(v) Section 5.1 of the Credit Agreement is hereby amended to
add the following as new subsection (j):
"(j) MINIMUM CASH REQUIREMENTS. Borrower shall
maintain at all times the minimum cash requirement as
specified in Section 3.2(d)(iv) herein."
(vi) Section 6.1(c) of the Credit Agreement is hereby amended
to read as follows:
"(c) FAILURE OF BORROWER TO PERFORM CERTAIN
COVENANTS. Borrower shall fail to perform or observe
any term, covenant or agreement contained in
subsections (b)(i), subsections (c) through (h), or
subsection (j) of Section 5.1."
(vii) Section 1(a) of the Schedule of Information is hereby
amended to read as follows:
"(a) Commitment: $29,500,000. The Loan facility will
consist of three tranches in the respective amounts
of (i) $7,000,000 ("Tranche A"), (ii) $9,500,000
("Tranche B"), and (iii) $10,000,000 ("Tranche C").
Borrower may request Loans under Tranche B only after
all Tranche A Loans have been disbursed, and may
request Loans under Tranche C only after all Loans
under Tranche B have been disbursed. Lender
acknowledges that, with respect to any Loan
disbursement under Tranche A only, Borrower need only
be in compliance with the condition set forth in
subsection (iv) of Section 3.2(d) and not any other
condition set forth in Section 3.2(d). As of July 26,
1999, the principal balance of all Loans outstanding
hereunder (excluding accrued interest) equals
approximately $2,784,245.25. The Commitment includes
Loan amounts currently outstanding under the Credit
Agreement. As used herein, the term "Loans" shall
mean all Loans under Tranche A, Tranche B and Tranche
C."
(viii) Section 1(b) of the Schedule of Information is hereby
amended to read as follows:
"(b) Fee(s): Utilization Fee: On or before the making
of any Loan by Lender under this Agreement, Borrower
shall have paid to Lender by check or wire transfer a
utilization fee in the amount of one percent (1%) of
the amount of such Loan. The parties acknowledge that
no utilization fee shall be payable with respect to
any Loans made prior to July 28, 1999."
(ix) Section 2(d)(ii) of the Schedule of Information is hereby
amended to read as follows:
4.
"(ii) Lender shall have been furnished copies of the
Leases (including any lease schedules and amendments
or modifications thereto) to be entered into by the
Borrower with FirstCom S.A. (Peru) and FirstCom Long
Distance S.A. (Chile) (the "Leases"), which Leases
shall permit the Liens created under the Security
Agreement and shall otherwise be in form acceptable
to Lender;"
(x) Section 2(d)(iv) of the Schedule of Information is hereby
amended to read as follows:
"(iv) At the time any Loan is made, the ratio of the
amount of all Loans outstanding (after giving effect
to the making of such Loan) to the value of the Cisco
Products financed shall not be more than 0.74 to
1.00."
(xi) Section 2(d) of the Schedule of Information is hereby
amended to add the following as new subsection (v):
"(v) Together with each notice of borrowing, Borrower
shall deliver to Lender copies of any schedules,
amendments or other modifications, if any, to any
Lease submitted or executed subsequent to the
immediately preceding notice of borrowing."
(b) REFERENCES WITHIN CREDIT AGREEMENT. Each reference in the
Credit Agreement to "this Agreement" and the words "hereof," "herein,"
"hereunder," or words of like import, shall mean and be a reference to the
Credit Agreement as amended by this Amendment.
SECTION 3 FEES.
(a) DOCUMENTATION DEPOSIT. Borrower has paid to Lender a
documentation deposit in the amount of $15,000. Such amount shall be applied (i)
to the utilization fee payable in connection with the first Loan disbursement
hereunder, or (ii) if the conditions set forth in Section 4 of this Amendment
are not satisfied, to the legal fees and expenses owing to Lender in connection
with this Amendment and the Credit Agreement (with any excess amount being
refunded to Borrower).
SECTION 4 CONDITIONS OF EFFECTIVENESS. The effectiveness of
Section 2 of this Amendment shall be subject to the satisfaction of each of
the following conditions precedent:
(a) FEES AND EXPENSES. Borrower shall have paid all fees then
due in accordance with Sections 3(a)(ii) of this Amendment.
(b) AMENDMENTS TO OTHER LOAN DOCUMENTS. Lender shall have
received the following amendments, waivers and consents with respect to the
other Loan Documents, in form and substance satisfactory to it:
(i) the Amended and Restated Master Promissory Note, executed
by Borrower.
5.
(c) DOCUMENTS AND ACTION RELATING TO COLLATERAL. Lender shall
have received the following, in form and substance satisfactory to it:
(i) executed copies of all UCC-1 financing statements
necessary or appropriate in the reasonable opinion of Lender to continue the
perfected security interests
(d) ADDITIONAL CLOSING DOCUMENTS AND ACTIONS. Lender shall
have received the following, in form and substance satisfactory to it:
(i) copies of the Lease(s) (including any lease schedules, and
any amendments or modifications thereto) entered into by the Borrower with
Borrower's Columbian Subsidiary, which Lease(s) shall permit the Liens created
under the Security Agreement and shall otherwise be in form acceptable to
Lender;
(ii) evidence that the Persons party to the Lease described
above have been irrevocably directed and instructed to make all payments due
under the Lease to the account of Lender at the California Bank;
(iii) evidence that all (A) authorizations or approvals of any
Governmental Authority, and (B) approvals or consents of any other Person, if
any, required in connection with the execution, delivery and performance of this
Amendment shall have been obtained;
(iv) a certificate of a senior officer of Borrower, stating
that (A) the representations and warranties contained in Section 4 and in the
amendments to the other Loan Documents are true and correct on and as of the
date of such certificate as though made on and as of the Effective Date and (B)
on and as of the Effective Date, after and giving effect to the amendment of the
Credit Agreement contemplated hereby, no Default shall have occurred and be
continuing; and
(v) a certificate of the Secretary or Assistant Secretary of
Borrower, dated the Effective Date, certifying (A) copies of the resolutions of
the Board of Directors of Borrower authorizing the execution, delivery and
performance of this Amendment and the amendments to the other Loan Documents and
(B) the incumbency, authority and signatures of each officer of Borrower
authorized to execute and deliver this Amendment and the amendments to the other
Loan Documents.
(e) LEGAL OPINIONS. Lender shall have received the opinion of
Borrower's counsel, dated the Effective Date, in substantially the form of
Exhibit A.
(f) MATERIAL ADVERSE CHANGE. On and as of the Effective Date,
there shall have occurred no Material Adverse Change since the date of this
Amendment.
(g) REPRESENTATIONS AND WARRANTIES; NO DEFAULT. On the
Effective Date, after giving effect to the amendment of the Credit Agreement
contemplated hereby:
(i) the representations and warranties contained in Section 4
and in the amendments to the other Loan Documents shall be true and correct on
and as of the Effective Date as though made on and as of such date; and
6.
(ii) no Default shall have occurred and be continuing.
(h) ADDITIONAL DOCUMENTS. Lender shall have received, in form
and substance satisfactory to it, such additional approvals, opinions, documents
and other information as Lender may reasonably request.
SECTION 5 REPRESENTATIONS AND WARRANTIES. To induce Lender to
enter into this Amendment, Borrower hereby confirms and restates, as of the date
hereof, the representations and warranties made by it in Section 4.1 of the
Credit Agreement and in the other Loan Documents. For the purposes of this
Section 5, (i) each reference in Section 4.1 of the Credit Agreement to "this
Agreement," and the words "hereof," "herein," "hereunder," or words of like
import in such Section, shall mean and be a reference to the Credit Agreement as
amended by this Amendment, and each reference in such Section to "the Loan
Documents" shall mean and be a reference to the Loan Documents as amended as
contemplated hereby, and (ii) , clause (i) shall take into account any
amendments to any disclosures made in writing by Borrower and any Guarantor to
Lender after the Closing Date and approved by Lender.
SECTION 6 MISCELLANEOUS.
(a) CREDIT AGREEMENT OTHERWISE NOT AFFECTED. Except as
expressly amended pursuant hereto, the Credit Agreement shall remain unchanged
and in full force and effect and is hereby ratified and confirmed in all
respects. Lender's execution and delivery of, or acceptance of, this Amendment
and any other documents and instruments in connection herewith (collectively,
the "Amendment Documents") shall not be deemed to create a course of dealing or
otherwise create any express or implied duty by it to provide any other or
further amendments, consents or waivers in the future.
(b) NO RELIANCE. Borrower hereby acknowledges and confirms to
Lender that Borrower is executing this Amendment and the other Amendment
Documents on the basis of its own investigation and for its own reasons without
reliance upon any agreement, representation, understanding or communication by
or on behalf of any other Person.
(c) COSTS AND EXPENSES. Borrower agrees to pay to Lender on
demand the reasonable out-of-pocket costs and expenses of Lender, and the
reasonable fees and disbursements of counsel to Lender, in connection with the
negotiation, preparation, execution and delivery of this Amendment and any other
documents to be delivered in connection herewith. Such costs and expenses may be
paid out of the documentation deposit pursuant to the terms of Section 3(a) of
this Amendment.
(d) BINDING EFFECT. This Amendment shall be binding upon,
inure to the benefit of and be enforceable by Borrower, Lender and their
respective successors and assigns.
(e) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
7.
(f) COMPLETE AGREEMENT; AMENDMENTS. This Amendment, together
with the other Amendment Documents and the other Loan Documents, contains the
entire and exclusive agreement of the parties hereto and thereto with reference
to the matters discussed herein and therein. This Amendment supersedes all prior
commitments, drafts, communications, discussions and understandings, oral or
written, with respect thereto. This Amendment may not be modified, amended or
otherwise altered except in accordance with the terms of Section 7.1(a) of the
Credit Agreement.
(g) SEVERABILITY. Whenever possible, each provision of this
Amendment shall be interpreted in such manner as to be effective and valid under
all applicable laws and regulations. If, however, any provision of this
Amendment shall be prohibited by or invalid under any such law or regulation in
any jurisdiction, it shall, as to such jurisdiction, be deemed modified to
conform to the minimum requirements of such law or regulation, or, if for any
reason it is not deemed so modified, it shall be ineffective and invalid only to
the extent of such prohibition or invalidity without affecting the remaining
provisions of this Amendment, or the validity or effectiveness of such provision
in any other jurisdiction.
(h) COUNTERPARTS. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute but one and the same agreement.
(i) INTERPRETATION. This Amendment and the other Amendment
Documents are the result of negotiations between and have been reviewed by
counsel to Lender, Borrower and other parties, and are the product of all
parties hereto. Accordingly, this Amendment and the other Amendment Documents
shall not be construed against Lender merely because of Lender's involvement in
the preparation thereof.
(j) LOAN DOCUMENTS. This Amendment and the other Amendment
Documents shall constitute Loan Documents.
8.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment, as of the date first above written.
FirstCom Equipment, Ltd.
By
---------------------------------------
Title:
Cisco Systems Capital Corporation
By
---------------------------------------
Title:
9.
