EXHIBIT 99.f.11
FIRST UNION SECURITIES, INC.
Xxx Xxxxx Xxxxx Xxxxxx, XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
June 6, 2001
MCG Credit Corporation
0000 Xxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Re: MCG Master Trust
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Ladies and Gentlemen:
Reference is made to Note Purchase Agreement dated as of June 1, 2000 (the "Note
Purchase Agreement") among MCG Master Trust (the "Trust"), MCG Credit
Corporation (the "Originator"), Variable Funding Capital Corporation ("VFCC")
and First Union Securities, Inc. ("FUSI"). Capitalized terms used herein and
not otherwise defined have the meanings set forth in the Note Purchase Agreement
or Appendix A to the Sale and Servicing Agreement (as defined in the Note
Purchase Agreement).
INITIAL AMENDMENTS
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You have requested that certain amendments be made to the Note Purchase
Agreement, the Sale and Servicing Agreement, the Series 2000-1 Terms Supplement
and certain related ancillary documents (collectively, the "Amendments"). The
text of the Amendments have been reviewed by you previously. This letter
confirms our understanding that the Amendments will not become effective until
you furnish us with evidence satisfactory to us that each of the following
conditions precedent has been satisfied:
1. The Commercial Loans originated to AMI Telecommunications Corp.
(f/k/a AMI Telecommunications Acquisition Corp.) and I-55 Internet
Services, Inc. shall have been removed from the calculation of the
Borrowing Base, and such Commercial Loans will not be included in such
calculation without our prior written consent.
2. The Originator shall have delivered to us an officer's certificate
relating to the authorization, execution and delivery by the Originator of
the Swingline Note (as defined in Amendment No. 1 to the Note Purchase
Agreement) and certifying that the performance by the Originator of its
obligations under the Swingline Note does not conflict with or result in a
breach of or default under the Originator's Certificate of Incorporation
or by-laws or any material agreement to which the Originator is a party.
3. The Originator shall have lowered the Risk Rating on each of the
following Commercial Loans to 7.00: Fawcette Technical Publications
Holding and New Northwest Broadcasters LLC. Further, for purposes of
determining the Concentration
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and Mix Criteria, the Originator shall not improve the Risk Rating of these
Commercial Loans without our prior written consent.
4. The Originator shall have paid to Stroock & Stroock & Xxxxx LLP
their fees and expenses incurred in connection with the Amendments.
SUBSEQUENT AMENDMENTS
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We understand that you expect to complete your initial public offering (the
"IPO") within the next few weeks. In connection with the IPO, you anticipate
merging the Seller into the Originator, with the Originator being the surviving
entity (the "Merger"), and changing the survivor's name to "MCG Capital
Corporation". As a result of these and other changes to your structure,
subsequent amendments will be required for the Note Purchase Agreement, the Sale
and Servicing Agreement, the Series 2000-1 Terms Supplement and certain related
ancillary documents (collectively, the "Subsequent Amendments").
While the exact terms of the Subsequent Amendments have not been prepared, you
have requested our consent to (i) the Merger and (ii) the removal of all
Supplemental Interests from the Trust. We hereby give such consent, effective
upon the satisfactory completion of each of the following conditions precedent:
1. Such Amendments to the Basic Documents have been entered into as we
believe are necessary.
2. Opinions of your counsel to the effect (in each case subject to
customary qualifications and exceptions) that (i) the interests of the
Indenture Trustee in the Commercial Loans are attached, perfected and
subject to no prior liens, (ii) each of the Basic Documents to which MCG
Capital Corporation is a party is a legal, valid, binding and
enforceable obligation, (iii) routine corporate power and authority
matters as to MCG Capital Corporation, (iv) the Trust is not an
"investment company" as defined in the Investment Company Act of 1940,
as amended, or otherwise required to be registered under said Act, and
(v) as to such other or additional matters as we may reasonably request.
3. An opinion of your counsel (subject to customary qualifications and
exceptions) to the effect that the transfer of the Commercial Loans from
MCG Capital Corporation to the Trust is a "true sale".
4. An opinion of your counsel as to the "non-consolidation" between MCG
Capital Corporation and the Trust.
5. UCC Financing Statements reflecting the Amendments shall have been
sent for filing in all jurisdictions necessary to protect the first
priority security interest of the Trust and the Indenture Trustee in the
Collateral.
6. the Originator shall have paid to Stroock & Xxxxxxx Xxxxx LLP their
fees and disbursements incurred in connection with the Subsequent
Amendments.
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Further, within five business days of us furnishing to you a pledge agreement,
you shall pledge to the Indenture Trustee, for the benefit of the Noteholders,
the Supplemental Interests listed on Schedule A thereto, along with all
Supplemental Interests owned currently by the Trust.
Please indicate your agreement to the foregoing by signing below in the space
provided.
Very truly yours,
FIRST UNION SECURITIES, INC.
By
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Name:
Title:
Consented to and Agreed.
MCG CREDIT CORPORATION
By
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Name:
Title:
SCHEDULE A
Schedule of Supplemental Interests
Obligor Type of Supplemental Interest Value
------- -------------------------------- ----------------
Netplexus Corporation Preferred Stock $765,805
The e-Media Club LLC LLC Membership Interests $ 60,000
Talk America Holdings, Inc. Warrant for Common Stock $ 24,750
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Total $850,555
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