Exhibit 10.4
EXECUTION COPY
AMENDMENT NO. 2
TO
AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 2 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
("Amendment") dated as of January 7, 1998, among KMC TELECOM INC., a Delaware
corporation ("KMC"), KMC Telecom II, Inc., a Delaware corporation ("KMC II"),
KMC Telecom Leasing I LLC, a Delaware limited liability company ("Leasing I"),
KMC Telecom Leasing II LLC, a Delaware limited liability company ("Leasing II";
KMC, KMC II, Leasing I and Leasing II being hereinafter collectively referred to
hereinafter as the "Borrowers" ), and AT&T COMMERCIAL FINANCE CORPORATION, a
Delaware corporation ("Lender").
WHEREAS, the Borrowers and the Lender are parties to that certain
Amended and Restated Loan and Security Agreement ("Loan Agreement") dated as of
September 22, 1997, pursuant to which the Lender has agreed to make certain
loans to the Borrowers; and
WHEREAS, the Borrowers have requested the Lender to amend the Loan
Agreement in the manner set forth herein, and Lender has agreed to such request;
NOW, THEREFORE, in consideration of the premises set forth above, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Borrowers and the Lender agree as follows:
SECTION 1. AMENDMENT TO THE LOAN AGREEMENT. Effective as of the date
first above written and subject to the execution of this Amendment by the
parties hereto, the Loan Agreement shall be and hereby is amended as follows:
(a) SECTION 1.02 is amended to delete the text of the definition of
"CHANGE OF CONTROL and to substitute the following therefor:
"CHANGE OF CONTROL" shall mean (A) other than by reason of the
death or disability of Xxxxxx X. Xxxxxx or prior to the raising
of at least $100,000,000 in unsecured debt by the Borrowers or
KMC Holdings, Xxxxxx X. Xxxxxx ceases to have senior management
responsibilities with respect to the Business and the other
operations of the Borrowers, or (B) KMC Holdings no longer
beneficially owns all of the outstanding Capital Stock of KMC or
KMC II (other than as a result of the exercise of the Warrants),
or (C) KMC shall no longer beneficially own all of the
outstanding membership interests in Leasing I or (D) KMC II shall
no
longer beneficially own all of the outstanding membership
interests in Leasing II.
(b) SECTION 1.02 is further amended to add in the definition of
"GOVERNMENTAL AUTHORITY" the words "any nation or government," after the
word "means" in the second line of such definition.
(c) SECTION 2.06(B) is amended to delete the word "ninth" in the
second line and to substitute therefor the word "tenth" and under the
caption "PAYMENT DATE NUMBER" to delete the number "9" and to substitute
therefor the number "10".
(d) SECTION 2.12(B) is amended to (i) in the third sentence thereof
add the words "and all rights of subrogation" after the words "under this
section" and (ii) add the following sentences after the third sentence
thereof:
Each Borrower agrees that any extension, forbearance or amendment, or
any acceptance, release or substitution of security, or any impairment
or suspension of Lender's remedies or rights against any other
Borrower or the cessation of the liability of any other Borrower for
any reason other than full and indefeasible satisfaction of all
Obligations shall not in any way affect the liability of such
Borrower. Each Borrower has provided itself of the means of remaining
informed of the financial condition of each other Borrower, and waives
any right to require Lender to keep it informed of the financial
condition of any other Borrower.
(e) SECTION 6,04(A) is amended by deleting the word "and" after the
words "to its shareholders," on the twentieth line thereof and adding the
words "; and (iv) KMC may repay any Debt, including interest thereon,
payable to KMC Holdings as permitted pursuant to SECTION 6.13(X)" after the
word "$800,000" and before the period on the twenty-third line thereof.
(f) SECTION 9.03 is amended to add the words "or pursue any remedy"
in the last sentence after the word "claim".
SECTION 3. REFERENCE TO AND EFFECT ON THE LOAN AGREEMENT.
3.1. Upon the effectiveness of this Amendment, each reference in the
Loan Agreement to "this Agreement", "hereunder", "hereof", "herein", or words of
like import shall mean and be a reference to the Loan Agreement as modified
hereby, and each reference to the Loan Agreement in any other document,
instrument or agreement shall mean and be a reference to the Loan Agreement as
modified hereby.
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3.2. Except as specifically amended hereby, the Loan Agreement and
other documents, instruments and agreements executed and/or delivered in
connection therewith shall remain in full force and effect and are hereby
ratified and confirmed.
3.3. The execution, delivery and effectiveness of this Amendment
shall neither (a) operate as a waiver of any right, power or remedy of the
Lender under the Loan Agreement or any other document, instrument or agreement
executed in connection therewith, or constitute a waiver of any provision
contained therein, nor (b) be deemed to be a consent to any other or further
actions or occurrences, except as specifically set forth herein.
SECTION 4. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE OTHER REMAINING TERMS OF THE LOAN AGREEMENT AND
THE INTERNAL LAWS (AS OPPOSED TO CONFLICT OF LAW PROVISIONS) OF THE STATE OF NEW
JERSEY.
SECTION 5. PARAGRAPH HEADINGS. The paragraph headings contained in
this Amendment are and shall be without substance, meaning or content of any
kind whatsoever and are not a part of the agreement among the parties hereto.
SECTION 6. COUNTERPARTS. This Amendment may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[Signature Page Follows]
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IN WITNESS WHEREOF, this Amendment has been duly executed as of the
day and year first above written.
KMC TELECOM INC.
By:
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President and CFO
KMC TELECOM II, INC.
By:
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President and CFO
KMC TELECOM LEASING I LLC
By:
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President and CFO
KMC TELECOM LEASING II LLC
By:
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President and CFO
AT&T COMMERCIAL FINANCE
CORPORATION
By:
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Name:
Title:
ACCEPTED AND AGREED TO:
CORESTATES BANK, N.A.
By:
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Its:
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GE CAPITAL CORPORATION
By:
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Its:
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