Exhibit 10(a)
EXECUTION COPY
FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT
THIS FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT (this
"Amendment"), dated as of April 28, 1998, is entered into by and
among MCI COMMUNICATIONS CORPORATION, a Delaware corporation (the
"Company") and the several financial institutions party to the
Credit Agreement referred to below (collectively, the "Banks").
RECITALS
A. The Company, the Banks, Bank of America National Trust
and Savings Association, as Competitive Bid Agent and Operating
Agent, Citibank, N.A., as Syndication Agent, The Chase Manhattan
Bank and NationsBank of Texas, N.A., as Co-Documentation Agents,
and the Co-Agents named therein are parties to a Revolving Credit
Agreement, dated as of April 30, 1997 (the "Credit Agreement")
pursuant to which the Banks have extended to the Company a
revolving credit facility and a competitive bid facility.
B. The Company has requested that the Banks agree to certain
amendments of the Credit Agreement.
C. CIBC Inc., LTCB Trust Company, The Sanwa Bank, Limited,
New York Branch, Toronto Dominion (New York), Inc. and The Toyo
Trust & Banking Co., Ltd., New York Branch (collectively, the
"Departing Banks") have declined to consent to such amendments and,
as a result, are withdrawing from the Credit Agreement.
D. Bank of America National Trust and Savings Association,
The Chase Manhattan Bank, Citibank, N.A. and NationsBank of Texas,
N.A. (collectively, the "Increasing Banks") have agreed to increase
the aggregate amount of their Commitments by an amount equal to the
aggregate amount of the Commitments of the Departing Banks.
E. The Banks (other than the Departing Banks) are willing to
so amend the Credit Agreement, subject to the terms and conditions
of this Amendment.
NOW, THEREFORE, for valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein,
capitalized terms used herein shall have the meanings, if any,
assigned to them in the Credit Agreement.
2. Amendments to Credit Agreement.
(a) Section 1.01 of the Credit Agreement is hereby amended
by:
(i) deleting therefrom the definition of "Applicable
Margin" in its entirety and substituting therefor the
following:
"'Applicable Margin' means, with respect to
Eurodollar Rate Advances, 0.15% per annum.";
(ii) deleting therefrom the definition of "Merger" in its
entirety;
(iii) deleting therefrom the definition of
"Termination Date" in its entirety and substituting therefor
the following:
"'Termination Date' means the earliest to occur of:
(a) April 26, 1999;
(b) a Change of Control;
(c) a merger, consolidation or combination by the
Company, directly or indirectly, with or into any other
Person, whether the Company is the surviving corporation
in any such transaction or otherwise;
(d) a sale, conveyance, transfer or other
disposition by the Company, directly or indirectly
(whether in one or a series of transactions), of all or
substantially all of its assets, whether now owned or
hereafter acquired; and
(e) the date on which the Commitments shall
otherwise terminate in accordance with the provisions of
this Agreement."; and
(iv) inserting the following new definition in its
appropriate alphabetical order:
"'Change of Control' means (a) any "person" or
"group" of persons (within the meaning of Section 13 or
14 of the Securities Exchange Act of 1934, as amended)
shall acquire "beneficial ownership" (within the meaning
of Rule 13d-3 promulgated by the Securities and Exchange
Commission under said Act) of more than 30% of the shares
of capital stock of the Company having the power to vote
for the election of directors, or (b) during any period
of 12 consecutive months, commencing before or after the
date of this Agreement and ending after the date of this
Agreement, individuals who on the first day of such
period were directors of the Company
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(together with any replacement or additional directors
who shall have been nominated or elected by a majority of
directors then in office) shall cease to constitute a
majority of the board of directors of the Company."
(b) Section 2.10 of the Credit Agreement is hereby amended by
deleting paragraph (a) thereof in its entirety and substituting
therefor the following:
"(a) Facility Fee. The Company will pay to the Operating
Agent, for the account of each Bank, a facility fee for the
period from and including the Effective Date to but excluding
the Termination Date at the rate of (i) 0.035% per annum for
the period from and including the Effective Date to but
excluding April 28, 1998 and (ii) 0.05% per annum thereafter,
on the actual amount of such Bank's Commitment from time to
time in effect, regardless of utilization, payable (x)
quarterly in arrears on each February 15, May 15, August 15
and November 15, commencing on May 15, 1997 and (y) on the
Termination Date."
(c) Section 3.12 of the Credit Agreement is hereby amended
by deleting the date "December 31, 1996" from each place where such
date appears and substituting therefor the date "December 31,
1997".
(d) Section 6.02 of the Credit Agreement is hereby amended by
deleting such Section in its entirety and substituting therefor the
following:
"6.02 Sale or Lease of Assets. The Company shall
not, directly or indirectly,
(a) sell, convey, transfer or otherwise dispose of
(whether in one or a series of transactions) any of the shares
of capital stock of MCI Telecom;
(b) sell, lease, convey, transfer or otherwise dispose
of (whether in one or a series of transactions) all or
substantially all of its assets, business or property, whether
now owned or hereafter acquired; or
(c) permit MCI Telecom to, directly or indirectly, sell,
lease, convey, transfer or otherwise dispose of (whether in
one or a series of transactions) all or a material part of the
assets, business or property of MCI Telecom (including
accounts and notes receivable, with or without recourse),
whether now owned or hereafter acquired, or enter into any
agreement to do any of the foregoing, except:
(i) dispositions by MCI Telecom of obsolete or
worn-out property or real property no longer used or
useful in its business;
(ii) sales by MCI Telecom to local exchange
carriers, with or without recourse, of customer
receivables in the ordinary course of business;
3
(iii) dispositions by MCI Telecom of assets
acquired, either directly or through the acquisition of
the owner of such assets, after the date of this
Agreement; provided, that each such disposition shall be
for fair and adequate consideration; and
(iv) dispositions (including sales pursuant to
sale-leaseback transactions) by MCI Telecom not otherwise
permitted hereunder which are made for fair market value;
provided that the book value of all Disposed Assets (as
hereinafter defined) disposed of pursuant to this Section
6.02(c)(iv) after the date of this Agreement does not
exceed 20% of the greater of (A) the book value of the
assets of MCI Telecom as of December 31, 1997 and (B) the
book value of the assets of MCI Telecom as of the date of
the most recent financial statements furnished to the
Operating Agent pursuant to Section 5.01.
For purposes of Section 6.02(c)(iv), the term "Disposed
Assets" shall mean all assets of MCI Telecom other than cash
and cash equivalents, equity investments, intercompany
receivables (but only if the receivables in question are being
transferred to the Company or any of its Subsidiaries),
franchises, licenses, permits, patents, patent applications,
copyrights, trademarks, trade names, goodwill, experimental or
organizational expense, and other like intangibles (but
excluding rights of way treated as assets)."
(e) Section 6.03 of the Credit Agreement is hereby amended by
deleting such Section in its entirety and substituting therefor the
following:
"6.03 Consolidations and Mergers. The Company shall
not, nor shall it permit MCI Telecom to, merge, consolidate or
combine, directly or indirectly, with or into any Person,
except MCI Telecom may merge, consolidate or combine with or
into, or transfer assets to, any other Person, if immediately
after giving effect thereto, (a) no Default or Event of
Default would exist, and (b) MCI Telecom shall be the
surviving corporation in such merger, consolidation or
combination."
(f) Article VII of the Credit Agreement is hereby amended by:
(i) deleting clause (e) thereof in its entirety and
substituting therefor the following:
"(e) Certain Article VI Defaults The Company shall
fail to perform or observe any term, covenant or
agreement contained in Section 6.01 (other than by reason
of an attachment or involuntary lien), 6.02 (other than
by reason of an event specified in the definition of
"Termination Date"), 6.03 (other than by reason of an
event specified in the definition of "Termination Date"),
6.06 or 6.08; or the Company shall fail to perform or
observe any term, covenant or agreement contained in
Section
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6.01 (if by reason of an attachment or
involuntary Lien) or 6.07 and such default shall continue
unremedied for a period of fifteen (15) days; or"
(ii) deleting clause (f) thereof in its entirety and
substituting therefor the following:
"(f) Other Covenant Defaults. The Company shall
fail to perform or observe any term, covenant or
agreement contained in Article V or Article VI (other
than those terms, covenants and agreements contained in
Section 6.01, 6.02, 6.03, 6.06, 6.07 or 6.08), and such
default shall continue unremedied for a period of thirty
(30) days; provided, that the failure to perform or
observe Section 5.12 shall not be an Event of Default
until such failure shall continue unremedied for a period
of thirty (30) days after notice thereof shall have been
given to the Company by the Majority Banks; or"
(iii) deleting the word "or" appearing at the end of
clause (l) thereof; and
(iv) deleting clause (m) thereof in its entirety.
(g) Schedule I to the Credit Agreement is hereby amended by
deleting such Schedule in its entirety and substituting therefor a
new Schedule I in the form of Annex I hereto.
(h) Schedule II to the Credit Agreement is hereby amended by
deleting therefrom all references to the respective Departing
Banks.
3. Representations and Warranties. The Company hereby
represents and warrants to the Agent and the Banks as follows:
(a) No Default or Event of Default has occurred and is
continuing.
(b) The execution and delivery by the Company of this
Amendment and the performance by the Company of the Credit
Agreement, as amended hereby (the "Amended Agreement"), have been
duly authorized by all necessary corporate and other action and do
not and will not require any registration with, consent or approval
of, notice to or action by, any Person (including any Governmental
Authority) in order to be effective and enforceable. The Amended
Agreement constitutes the legal, valid and binding obligation of
the Company, enforceable against it in accordance with its terms.
(c) All representations and warranties of the Company
contained in the Amended Agreement are true and correct as of the
date hereof as if made on the date hereof.
4. Effective Date. This Amendment will become effective as
of the date first written above on the date that the Operating
Agent shall have received each of the following, in form and
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substance satisfactory to the Operating Agent, its counsel and the
Banks and in sufficient copies for each Bank:
(a) a duly executed original (or, if elected by the Operating
Agent, an executed facsimile copy) of this Amendment from the
Company and each of the Banks (including the Departing Banks);
(b) a copy of a resolution passed by the Company's board of
directors, certified by the Secretary or an Assistant Secretary of
the Company as being in full force and effect on the date hereof,
authorizing the execution and delivery by the Company of this
Amendment and the performance by the Company of the Amended
Agreement;
(c) a certificate of the Secretary or Assistant Secretary of
the Company certifying as of the date hereof the names and true
signatures of the officers of the Company authorized to execute and
deliver this Amendment;
(d) a duly executed Pro Rata Note payable to each of the
Increasing Banks in a principal amount equal to the new amount of
such Increasing Bank's Commitment as set forth on Annex I hereto;
(e) evidence satisfactory to it that the Operating Agent has
been paid, for the account of the respective Departing Banks, all
facility fees payable to such Banks that are accrued but unpaid as
of the date hereof and all other amounts, if any, due to such Banks
under the Credit Agreement; and
(f) an opinion of the General Counsel to the Company, dated
the date hereof and substantially in the form of Exhibit A-1
hereto, and an opinion of Kramer, Levin, Naftalis & Xxxxxxx,
special New York counsel to the Company, dated the date hereof and
substantially in the form of Exhibit A-2 hereto, but in each case
also covering such other matters incident to the transactions
contemplated by this Amendment as the Operating Agent shall
reasonably require.
The Operating Agent shall ask each of the Departing Banks to
return the Notes originally executed and delivered in connection
with the Credit Agreement to the Operating Agent. Upon receipt of
such Notes, the Operating Agent shall xxxx such Notes "Cancelled"
and return such Notes to the Company. In addition, the Operating
Agent shall ask each of the Increasing Banks to return the Pro Rata
Notes originally executed and delivered in connection with the
Credit Agreement to the Operating Agent. Upon receipt of such
Notes, the Operating Agent shall xxxx such Notes "Superseded" and
return such Notes to the Company. Each Increasing Bank agrees to
return to the Operating Agent such Pro Rata Note for such purpose.
For purposes of determining compliance with the foregoing
conditions specified in this Section 4, each Bank that has executed
this Amendment shall be deemed to have consented to, approved or
accepted or to be satisfied with, each document or other matter
either sent by the
6
Operating Agent to such Bank for consent, approval, acceptance or satisfaction,
or required hereunder to be consented to or approved by or acceptable or
satisfactory to, such Bank.
5. Release of Departing Banks. The Company hereby releases
the Departing Banks from their respective Commitments under the
Credit Agreement, which Commitments are terminated upon the
effectiveness of this Amendment. The Company acknowledges and
agrees that the obligations and liabilities of the Company
contained in the Credit Agreement which by their terms survive
termination of the Commitments for any period of time shall survive
the termination of the Departing Banks' respective Commitments for
the respective periods of time specified in the Credit Agreement.
6. Miscellaneous.
(a) Except as herein expressly amended, all terms, covenants
and provisions of the Credit Agreement are and shall remain in full
force and effect. All references in the Loan Documents to the
Credit Agreement shall henceforth be deemed to refer to the Credit
Agreement as amended hereby.
(b) This Amendment shall be binding upon and inure to the
benefit of the parties hereto and thereto and their respective
successors and assigns. No third party beneficiaries are intended
in connection with this Amendment.
(c) This Amendment shall be governed by, and construed in
accordance with, the law of the State of New York applicable to
contracts made and to be prepared entirely within such State.
(d) This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all
such counterparts together shall constitute but one and the same
instrument. Each of the parties hereto understands and agrees that
this document (and any other document required herein) may be
delivered by any party thereto either in the form of an executed
original or an executed original sent by facsimile transmission to
be followed promptly by mailing of a hard copy original, and that
receipt by the Operating Agent of a facsimile transmitted document
purportedly bearing the signature of a Bank or the Company shall
bind such Bank or the Company, respectively, with the same force
and effect as the delivery of a hard copy original. Any failure by
the Operating Agent to receive the hard copy executed original of
such document shall not diminish the binding effect of receipt of
the facsimile transmitted executed original of such document of the
party whose hard copy page was not received by the Operating Agent.
(e) This Amendment, together with the Credit Agreement,
contains the entire and exclusive agreement of the parties hereto
with reference to the matters discussed herein and therein. This
Amendment supersedes all prior drafts and communications with
respect thereto. This Amendment may not be amended except in
accordance with the provisions of Section 9.01 of the Credit
Agreement.
(f) If any term or provision of this Amendment shall be
deemed prohibited by or invalid
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under any applicable law, such provision shall be invalidated without affecting
the remaining provisions of this Amendment or the Credit Agreement.
(g) The Company agrees to pay or reimburse the Operating
Agent, within fifteen (15) days after demand, for all its
reasonable out-of-pocket costs and expenses incurred in connection
with the preparation, execution and delivery of this Amendment and
any other documents prepared in connection herewith, including the
reasonable fees and out-of-pocket expenses of counsel to the
Operating Agent (including the allocated cost of in-house counsel)
with respect thereto; provided, that any demand for payment or
reimbursement of any of the foregoing shall be accompanied by an
itemized statement or statements covering the related costs,
expenses or allocated cost.
IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Amendment as of the date first above written.
MCI COMMUNICATIONS CORPORATION
By:
Title:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By:
Title:
THE CHASE MANHATTAN BANK
By:
Title:
8
CITIBANK, N.A.
By:
Title:
NATIONSBANK OF TEXAS, N.A.
By:
Title:
THE BANK OF NEW YORK
By:
Title:
THE BANK OF NOVA SCOTIA
By:
Title:
9
THE FIRST NATIONAL BANK OF CHICAGO
By:
Title:
MELLON BANK, N.A.
By:
Title:
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
By:
Title:
THE FUJI BANK LIMITED,
NEW YORK BRANCH
By:
Title:
00
XXX XXXXXXXX XXXX, XXXXXXX,
XXX XXXX BRANCH
By:
Title:
THE BANK OF TOKYO-MITSUBISHI,
LTD., NEW YORK BRANCH
By:
Title:
XXXXX FARGO BANK, N.A.
By:
Title:
By:
Title:
COMERICA BANK
By:
Title:
11
THE DAI-ICHI KANGYO BANK, LTD.
By:
Title:
DEUTSCHE BANK AG, NEW YORK
AND/OR CAYMAN ISLANDS BRANCHES
By:
Title:
By:
Title:
WACHOVIA BANK OF GEORGIA, N.A.
By:
Title:
12
BANQUE NATIONALE DE PARIS
By:
Title:
By:
Title:
BARCLAYS BANK PLC
By:
Title:
FIRST NATIONAL BANK OF MARYLAND
By:
Title:
SUNTRUST BANK,
CENTRAL FLORIDA, N.A.
By:
Title:
00
XXXXX XXXX XX XXXXXXXXXXX,
XXX XXXX BRANCH
By:
Title:
By:
Title:
FIRST UNION NATIONAL BANK
(formerly known as Signet Bank)
By:
Title:
14
Each of the undersigned Departing Banks acknowledges and
agrees that:
(a) such Bank is withdrawing from the Credit Agreement;
(b) all fees and other amounts due to such Bank under the
Credit Agreement have been paid in full;
(c) such Bank's obligations to the Agents under Section 8.07
of the Credit Agreement survive the termination of such Bank's
Commitment;
(d) such Bank's obligations to the Operating Agent and the
Company pursuant to Section 2.15 of the Credit Agreement remain in
full force and effect with respect to all amounts paid to such Bank
(and all Taxes paid or payable with respect thereto) on or prior to
the termination of such Bank's Commitment; and
(e) upon the effectiveness of this Amendment, such Bank
releases the Company from all of its obligations and liabilities to
such Bank under the Credit Agreement and the other Loan Documents,
except for such obligations and liabilities which by their terms
survive termination of the Commitments for any period of time,
which obligations and liabilities shall survive the termination of
such Bank's Commitment for the respective periods of time specified
in the Credit Agreement.
Each of the undersigned Departing Banks further agrees to
return to the Operating Agent the Notes originally executed and
delivered to such Bank pursuant to the Credit Agreement and
authorizes the Operating Agent to xxxx such Notes "Cancelled" and
return such Notes to the Company.
CIBC INC.
By:
Title:
LTCB TRUST COMPANY
By:
Title:
00
XXX XXXXX XXXX, XXXXXXX,
XXX XXXX BRANCH
By:
Title:
TORONTO-DOMINION (NEW YORK), INC.
By:
Title:
THE TOYO TRUST & BANKING CO.,
LTD., NEW YORK BRANCH
By:
Title:
By:
Title:
16
ANNEX I
to Amendment
SCHEDULE I
Commitments
Bank of America National Trust
and Savings Association $450,000,000
The Chase Manhattan Bank $350,000,000
Citibank, N.A. $350,000,000
NationsBank of Texas, N.A. $350,000,000
The Bank of New York $235,000,000
The Bank of Nova Scotia $235,000,000
The First National Bank of Chicago $235,000,000
Mellon Bank, N.A. $235,000,000
Xxxxxx Guaranty Trust Company of New York $235,000,000
The Fuji Bank, Limited, New York Branch $190,000,000
The Sumitomo Bank, Limited,
New York Branch $190,000,000
The Bank of Tokyo-Mitsubishi, Ltd. $145,000,000
Xxxxx Fargo Bank, N.A. $145,000,000
Comerica Bank $ 95,000,000
The Dai-Ichi Kangyo Bank, Ltd. $ 95,000,000
Deutsche Bank AG, New York
and/or Cayman Islands Branches $ 95,000,000
Wachovia Bank of Georgia, N.A. $ 95,000,000
Banque Nationale de Paris $ 50,000,000
Barclays Bank plc $ 50,000,000
First National Bank of Maryland $ 50,000,000
SunTrust Bank, Central Florida, N.A. $ 50,000,000
Union Bank of Switzerland,
New York Branch $ 50,000,000
First Union National Bank (formerly known as Signet Bank) $ 25,000,000
