Exhibit 10.7
AMENDMENT NO. 1 TO THE
CREDIT AGREEMENT
Dated as of June 1, 2001
AMENDMENT NO. 1 TO THE CREDIT AGREEMENT among ITC/\DeltaCom, Inc., a
Delaware corporation (the "Parent"), Interstate FiberNet, Inc., a Delaware
corporation (the "Borrower"), ITC/\Deltacom Communications, Inc., an Alabama
corporation, DeltaCom Information Systems, Inc., an Alabama corporation
(collectively, the "Subsidiary Guarantors"), the banks, financial institutions
and other institutional lenders parties to the Credit Agreement referred to
below (collectively, the "Lenders") and Xxxxxx Xxxxxxx Senior Funding, Inc., as
administrative agent (the "Administrative Agent") for the Lenders.
PRELIMINARY STATEMENTS:
(1) The Borrower, the Parent, the Subsidiary Guarantors, the Lenders and
the Administrative Agent have entered into a Credit Agreement dated as of April
5, 2000 (as amended, supplemented or otherwise modified through the date hereof,
the "Credit Agreement"). Capitalized terms not otherwise defined in this
Amendment have the same meanings as specified in the Credit Agreement.
(2) The Borrower, the Parent, the Subsidiary Guarantors and the Required
Lenders have agreed to amend the Credit Agreement as hereinafter set forth.
(3) The Required Lenders are, on the terms and conditions stated below,
willing to grant the request of the Borrower and the Borrower, the Parent, the
Subsidiary Guarantors and the Required Lenders have agreed to amend the Credit
Agreement as hereinafter set forth.
SECTION 1. Amendments to Credit Agreement. The Credit Agreement is,
effective as of the date hereof and subject to the satisfaction of the
conditions precedent set forth in Section 2, hereby amended as follows:
(a) The definition of "Change of Control" in Section 1.01
is amended in full and replaced as follows:
"Change of Control means the occurrence on any date of any of the
following: (a) a "person" or "group" (within the meaning of Sections 13(d)
and 14(d)(2) of the Securities Exchange Act of 1934) becomes the ultimate
"beneficial owner" (as defined in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934), of more than 35% of
the total voting power of the Voting Stock
of the Parent on a fully diluted basis and such ownership represents a
greater percentage of the total voting power of the Voting Stock of the
Parent, on a fully diluted basis, than is held by the Existing Stockholders
on such date; or (b) during any period of up to 24 consecutive months,
commencing after the date of this Agreement, individuals who at the
beginning of such 24-month period were directors of the Parent or persons
whose election or nomination as directors was approved by a majority of
such individuals shall cease for any reason to constitute a majority of the
board of directors of the Parent; or (c) the Parent shall cease to own 100%
of the Equity Interests of the Borrower." For purposes of this definition,
"fully diluted basis" shall be construed in the same manner as "fully
diluted basis" in the definition of "Change of Control" contained in the
Indentures.
(b) Section 1.01 is further amended to add the following definitions:
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether outstanding on the
date of this Agreement or issued thereafter, including, without limitation,
all Common Stock and Preferred Stock.
"Common Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's equity, other than Preferred Stock
of such Person, whether outstanding on the date of this Agreement or issued
thereafter, including, without limitation, all series and classes of such
common stock.
"Existing Stockholders" means Xxxxxxxx X. Xxxxxx, III and SCANA
Corporation and their Affiliates, and Xxxxxxxx X. Xxxxxx, III's spouse and
any one or more of his lineal descendants and their spouses; provided,
however, that any such person other than Xxxxxxxx X. Xxxxxx, III shall only
be deemed to be an "Existing Stockholder" to the extent such person's
Capital Stock of the Parent was received, directly or indirectly, from
Xxxxxxxx X. Xxxxxx, III. For purposes of this definition, "Affiliate"
means, as applied to any Person, any other Person directly or indirectly
controlling, controlled by, or under direct or indirect common control
with, such Person. For purposes of this definition, "control" (including,
with correlative meanings, the terms "controlling," "controlled by" and
"under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through
the ownership of voting securities, by contract or otherwise.
"Indentures" means (a) the Indenture, dated as of June 3, 1997, as
amended from time to time, between the Parent and United States Trust
Company of New York, as Trustee; (b) the Indenture, dated as of March 3,
1998, as amended from time to time, between the Parent and the United
States Trust Company of New York, as Trustee; and (c) the Indenture, dated
as of November 5, 1998, as amended from time to time, between the Parent
and United States Trust Company of New York, as Trustee.
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-
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voting) of such Person's preferred or preference equity, whether
outstanding on the date of this Agreement or issued thereafter, including,
without limitation, all series and classes of such preferred or preference
stock.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
(c) Section 5.01 is amended by adding thereto a new subsection (o) to
read as follows:
"(o) Consent Fee. On the date of first issuance by the Parent of its
Series B-1 Cumulative Convertible Preferred Stock, par value $.01 per
share, pay to the Administrative Agent, on behalf of each Lender which has
executed a counterpart of the Amendment No. 1 to the Credit Agreement dated
as of June 1, 2001, a consent fee of 0.25% of such Lender's Commitment
hereunder."
(d) Section 5.02(b)(iii)(x) is amended by deleting the figure
"$50,000,000" and substituting for such figure the figure "$70,000,000".
(e) Article VIII is amended by adding thereto a new section 8.07 to
read as follows:
"SECTION 8.07. Appointment of Subagents. "Anything herein to the
contrary notwithstanding, the Collateral Agent may from time to time, when
the Collateral Agent deems it to be necessary, appoint one or more
subagents or collateral co-agents (each, a "Subagent") with respect to all
or any part of the Collateral. In the event that the Collateral Agent so
appoints any Subagent with respect to any Collateral, (i) the Liens on such
Collateral granted pursuant to the applicable Collateral Documents shall be
deemed for purposes of this Agreement and the other Loan Documents to have
been granted to such Subagent, in addition to the Collateral Agent, for the
benefit of the Secured Parties, (ii) such Subagent shall be automatically
vested, in addition to the Collateral Agent, with all rights, powers,
privileges, interests and remedies of the Collateral Agent under the Loan
Documents with respect to such Collateral, (iii) the provisions of this
Article 8 and of Section 9.04 that refer to each Agent shall be deemed to
be references to each Agent and/or each Subagent, as the context may
require, and (iv) the term "Collateral Agent", when used herein or in any
of the applicable Collateral Documents in relation to any rights, powers,
privileges, interests and remedies of the Collateral Agent with respect to
such Collateral shall include such Subagent; provided, however, that no
such Subagent shall be authorized to take any action with respect to any
such Collateral unless and except to the extent expressly authorized in
writing by the Collateral Agent."
SECTION 2. Conditions of Effectiveness. This Amendment shall become
effective as of the date first above written when, and only when the
Administrative Agent shall have received counterparts of this Amendment executed
by the Borrower, the Parent, the Subsidiary Guarantors and the Required Lenders
or, as to any of the Lenders, advice satisfactory to the Administrative Agent
that such Lender has executed this Amendment. This Amendment is subject to the
provisions of Section 9.01 of the Credit Agreement.
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SECTION 3. Representations and Warranties of the Borrower. The
Borrower represents and warrants that:
(a) the representations and warranties contained in each Loan Document
are correct in all material respects on and as of the date hereof, before
and after giving effect to this Amendment, other than any such
representations and warranties that, by their terms, refer to a specific
date other than the date hereof, in which case as of such specific date;
and
(b) no Default has occurred and is continuing, or would result from
this Amendment.
SECTION 4. Consent of the Borrower, the Parent and the Subsidiary
Guarantors. The Parent and the Subsidiary Guarantors, as Guarantors under the
Credit Agreement, and the Borrower, the Parent and the Subsidiary Guarantors, as
Grantors under the Security Agreement, hereby consent to this Amendment and
hereby confirm and agree that (a) they have received a copy of and reviewed to
their satisfaction this Amendment, (b) notwithstanding the effectiveness of this
Amendment, each of the Guaranties, the Security Agreement and the other Loan
Documents are, and shall continue to be, in full force and effect and are hereby
ratified and confirmed in all respects, except that, on and after the
effectiveness of this Amendment, each reference in the Loan Documents to the
"Credit Agreement", "thereunder", "thereof" or words of like import shall mean
and be a reference to the Credit Agreement, as amended by this Amendment, and
(c) the Loan Documents to which the Borrower, the Parent or any Subsidiary
Guarantor is a party and all of the Collateral described therein do, and shall
continue to, secure the payment of all of the Secured Obligations.
SECTION 5. Reference to and Effect on the Credit. (a) On and after the
effectiveness of this Amendment, each reference in the Credit Agreement to "this
Agreement", "hereunder", "hereof" or words of like import referring to the
Credit Agreement, and each reference in the Notes to "the Credit Agreement",
"thereunder", "thereof" or words of like import referring to the Credit
Agreement, shall mean and be a reference to the Credit Agreement, as amended by
this Amendment.
(b) The Credit Agreement and the other Loan Documents as specifically
amended by this Amendment, are and shall continue to be in full force and effect
and are hereby in all respects ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of any Lender or the Administrative Agent under any of the Loan
Documents, nor constitute a waiver of any provision of any of the Loan
Documents.
SECTION 6. Costs, Expenses. The Borrower agrees to pay on demand,
which shall not be prior to the date of first issuance by the Parent of the
securities referred to in section 5.01(o), all costs and expenses of the
Administrative Agent in connection with the preparation, execution, delivery and
administration, modification and amendment of this Amendment and the other
instruments and documents to be delivered hereunder (including, without
limitation, the
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reasonable fees and expenses of counsel for the Administrative Agent) in
accordance with the terms of Section 9.04 of the Credit Agreement.
SECTION 7. Execution in Counterparts. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Amendment by
telecopier shall be effective as delivery of a manually executed counterpart of
this Amendment.
SECTION 8. Governing Law. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
ITC/\DELTACOM, INC.
By /s/ Xxxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
-------------------------
INTERSTATE FIBERNET, INC.
By /s/ Xxxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
-------------------------
ITC/\DELTACOM COMMUNICATIONS, INC.
By /s/ Xxxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
-------------------------
DELTACOM INFORMATION SYSTEMS, INC.
By /s/ Xxxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
-------------------------
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XXXXXX XXXXXXX SENIOR FUNDING, INC.,
as Administrative Agent and as Lender
By /s/ Xxxx Xxxxxxxxx
-------------------------------
Title: Managing Director
---------------------------
XXXXXX XXXXXXX & CO. INCORPORATED,
as Collateral Agent
By /s/ Xxxx Xxxxxxxxx
-------------------------------
Title: Managing Director
---------------------------
As Lenders
----------
ALLIANCE CAPITAL FUNDING, L.L.C.
By /s/
---------------------------------
Title: Vice President
-----------------------------
ELC (CAYMAN) LTD. 2000-1
By /s/
---------------------------------
Title: Director
-----------------------------
ELT LTD.
By /s/ Xxx X. Xxxxxx
---------------------------------
Title: Authorized Agent
-----------------------------
EXCEL BANK
By /s/
---------------------------------
Title: Vice President
-----------------------------
FIDELITY & GUARANTY LIFE
INSURANCE CO.
By /s/
---------------------------------
Title: Vice President
-----------------------------
FIVE FINANCE CORPORATION
By Citibank N.A.
--------------------------------
Title: Additional Investment Manager
-----------------------------
By: /s/ Xxxx Xxxxx
----------------------------
Title: Managing Director,
----------------------
Alternative Investment
----------------------
Strategies
----------------------
FRANKLIN FLOATING RATE TRUST
By Xxxxxxxx Xxxxxx
---------------
Title: Vice President
--------------
GREAT POINT CLO 1999-1 LTD.
By
-----------------------
Title:
--------------------
IBM CREDIT CORPORATION
By /s/
----------------
Title: Manager of Credit
-----------------
KZH ING-2 LLC
By /s/ Xxxxxxxx Xxxx
-----------------
Title: Authorized Agent
----------------
MAPLEWOOD (CAYMAN) LIMITED
By: Massachusetts Mutual Life Insurance
Company as Investment Manager
By /s/ Xxxxxx X. Xxxx
------------------
Title: Second Vice President and
-------------------------
Associate General Counsel
-------------------------
MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY
By /s/ Xxxxxx X. Xxxx
------------------
Title: Second Vice President and
-------------------------
Associate General Counsel
-------------------------
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SUFFIELD CLO, LIMITED
By: Massachusetts Mutual Life Insurance
Company as Collateral Manager
By /s/ Xxxxxx X. Xxxx
------------------
Title: Second Vice President and Associate
-----------------------------------
General Counsel
---------------
OSPREY INVESTMENTS PORTFOLIO
By: Citibank, N.A., as Manager
By /s/ Xxxx Xxxxx
--------------
Title: Alternative Investment Strategies
---------------------------------
PACIFICA PARTNERS I, L.P.
By Imperial Credit Asset Mgmt., as its
Investment Manager
By /s/ Xxxx X. Xxxxx
-----------------
Title: Vice President
--------------
PROMETHEUS INVESTMENT
FUNDING NO. 1 LTD.
By: CPF Asset Advisory, LLC, As
Investment Manager
By /s/ Xxxxxxx Xxxxxx
------------------
Title: Director
--------
By /s/ Xxxxx Xx
------------
Title: Associate Director
------------------
SANKATY HIGH YIELD PARTNERS
II, L.P.
By /s/ Xxxxx X. Xxxxx
------------------
Title: Managing Director, Portfolio Manager
------------------------------------
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SANKATY ADVISORS, INC. as Collateral
Manager for Great Point CLO 1999-1 LTD.,
as Term Lender
By /s/ Xxxxx X. Xxxxx
------------------
Title: Managing Director, Portfolio Manager
------------------------------------
TORONTO DOMINION (NEW YORK),
INC.
By /s/ Xxxx Xxxxxxxx
-----------------
Title: Vice President
--------------
XXXXX CLO LTD. 2000-1
By /s/
-----------------------------
Title: Director
--------
XXXXXXX BANK
By /s/ Xxxxxxxxx X. Xxxxx
----------------------
Title: Vice President
--------------
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