Exhibit 4(b)
CREDIT AGREEMENT, dated as of the 30th day of June, 1997, by and among C-
TEC CORPORATION (the "Borrower"), the Lenders who are or may become a party to
this Agreement, and FIRST UNION NATIONAL BANK, as Administrative Agent for the
Lenders.
STATEMENT OF PURPOSE
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The Borrower has requested, and the Lenders have agreed, to extend certain
credit facilities to the Borrower on the terms and conditions of this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree as follows:
ARTICLE I
DEFINITIONS
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SECTION
1.1 Definitions. The following terms when used in this Agreement shall have
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the meanings assigned to them below:
"Adjusted Operating Cash Flow" means, with respect to any Person for any
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period, the total of the following for such period calculated in accordance with
GAAP: (a) Operating Cash Flow less (b) the sum of (i) cash taxes, (ii) cash
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dividends and other distributions and redemptions paid with respect to capital
stock and (iii) Capital Expenditures.
"Administrative Agent" means First Union in its capacity as Administrative
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Agent hereunder, and any successor thereto appointed pursuant to Section 11.9.
"Administrative Agent's Office" means the office of the Administrative
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Agent specified in or determined in accordance with the provisions of Section
12.1.
"Affiliate" means, with respect to any Person, any other Person (other than
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a Subsidiary) which directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such first
Person or any of its Subsidiaries. The term "control" means (a) the power to
vote ten percent (10%) or more of the securities or other equity interests of a
Person having ordinary voting power, or (b) the possession, directly or
indirectly, of any other power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.
"Agreement" means this Credit Agreement, as amended, restated or otherwise
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modified from time to time.
"Applicable Law" means all applicable provisions of constitutions,
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statutes, laws, rules, treaties, regulations and orders of all Governmental
Authorities and all orders and decrees of all courts and arbitrators.
"Applicable Margin" shall have the meaning assigned thereto in Section
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3.1(c).
"Assignment and Acceptance" shall have the meaning assigned thereto in
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Section 12.10.
"Base Rate" means, at any time, the higher of (a) the Prime Rate or (b) the
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Federal Funds Rate plus 1/2 of 1%; each change in the Base Rate shall take
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effect simultaneously with the corresponding change or changes in the Prime Rate
or the Federal Funds Rate.
"Base Rate Loan" means any Loan bearing interest at a rate based upon the
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Base Rate as provided in Section 3.1(a).
"Borrower" means C-TEC in its capacity as borrower hereunder.
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"Business Day" means (a) for all purposes other than as set forth in clause
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(b) below, any day other than a Saturday, Sunday or legal holiday on which banks
in Charlotte, North Carolina and New York, New York, are open for the conduct of
their commercial banking business, and (b) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and
that is also a day for trading by and between banks in Dollar deposits in the
London interbank market.
"Cable New York" means C-TEC Cable Systems of New York, Inc. and its
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successors.
"Cable Systems" means C-TEC Cable Systems, Inc. and its successors.
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"Cable Systems Credit Facility" means the credit agreement of even date by
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and among Cable Systems, Inc. ComVideo and Cable New York, as borrowers, First
Union, as administrative agent, and the lenders party thereto, as amended,
restated or otherwise modified.
"Capital Asset" means, with respect to any Person, any asset that should,
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in accordance with GAAP, be classified and accounted for as a capital asset on a
balance sheet of such Person.
"Capital Expenditures" means, with respect to any Person for any period,
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the aggregate cost of all Capital Assets acquired by such Person (other than
Capital Assets acquired in accordance with the terms hereof with the proceeds
from casualty insurance or condemnations) during such period determined in
accordance with GAAP.
"Capital Lease" means, with respect to any Person, any lease of any
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property that should, in accordance with GAAP, be classified and accounted for
as a capital lease on a balance sheet of such Person.
"CCI" means Commonwealth Communications, Inc.
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"CCSM" means Cable Michigan, Inc., and its successors.
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"CCSM Credit Facility" means the credit agreement of even date by and among
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CCSM, as borrower, First Union, as administrative agent, and the lenders party
thereto, as amended, restated or otherwise modified.
"C-TEC" means C-TEC Corporation, and its successors.
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"Change in Control" shall have the meaning assigned thereto in Section
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10.1(h).
"Closing Date" means the date of this Agreement or such later Business Day
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upon which each condition described in Section 5.2 shall be satisfied or waived
in all respects in a manner acceptable to the Administrative Agent, in its sole
discretion.
"Code" means the Internal Revenue Code of 1986, and the rules and
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regulations thereunder, each as amended or supplemented from time to time.
"Combined" means, when used in reference to financial statements or
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financial statement items of any Person prior to the date of the Distributions,
such statements or items on a combined basis in accordance with applicable
principles of combination under GAAP, and on and after the date of the
Distributions, such statements or items on a consolidated basis in accordance
with applicable principles of consolidation under GAAP.
"Commitment" means (a) as to any Lender, the obligation of such Lender to
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make the Loans to the account of the Borrower hereunder in an aggregate
principal amount not to exceed the amount set forth opposite such Lender's name
on Schedule 1.1(a), as such amounts may be reduced or modified at any time or
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from time to time pursuant to the terms hereof and (b) as to all Lenders, the
aggregate commitment of all Lenders to make Loans. The Commitment of all
Lenders as of the Closing Date shall be One Hundred Twenty-Five Million Dollars
($125,000,000).
"Commitment Percentage" means, as to any Lender at any time, the ratio of
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(a) the amount of the Commitment of such Lender to (b) the Commitment of all of
the Lenders.
"Commonwealth" means Commonwealth Telephone Company and its successors.
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"Commonwealth Long Distance" means Commonwealth Long Distance Company and
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its successors.
"ComVideo" means ComVideo Systems, Inc. and its successors.
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"Debt" means, with respect to any Person at any date and without
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duplication, the sum of the following calculated in accordance with GAAP: (a)
all liabilities, obligations and indebtedness for borrowed money including but
not limited to obligations evidenced by bonds, debentures, notes or other
similar instruments of any such Person, (b) all obligations to pay the deferred
purchase
price of property or services of any such Person, except trade payables arising
in the ordinary course of business not more than ninety (90) days past due, (c)
all obligations of any such Person as lessee under Capital Leases, (d) all Debt
of any other Person secured by a Lien on any asset of any such Person, (e) all
Guaranty Obligations of any such Person, (f) all obligations, contingent or
otherwise, of any such person relative to the face amount of letters of credit,
whether drawn or not drawn, and banker's acceptances issued for the account of
any such person and (g) all obligations incurred by any such Person pursuant to
Hedging Agreements.
"Default" means any of the events specified in Section 10.1 which with the
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passage of time, the giving of notice or both, would constitute an Event of
Default.
"Designated Subsidiaries" means, prior to the date of the Distributions,
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Commonwealth, CCI and Commonwealth Long Distance, and any of their Subsidiaries,
and on and after the date of the Distributions, all Subsidiaries of the
Borrower.
"Disqualified Stock" means any capital stock of a Person that by its terms
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(a) has any scheduled interest or dividend payment, (b) upon the passage of time
or occurrence of any event has any redemption or similar payment due, (c) is
required to be redeemed or repurchased at the option of any holder or otherwise
or (d) is convertible into Debt or is convertible to another security which
contains any such terms.
"Dollars" or "$" means, unless otherwise qualified, dollars in lawful
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currency of the United States.
"Eligible Assignee" means, with respect to any assignment of the rights,
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interest and obligations of a Lender hereunder, a Person that is at the time of
such assignment (a) a commercial bank organized or licensed under the laws of
the United States or any state thereof, having combined capital and surplus in
excess of $500,000,000, (b) a finance company, insurance company or other
financial institution which in the ordinary course of business extends credit of
the type extended hereunder and that has total assets in excess of
$1,000,000,000, (c) already a Lender hereunder (whether as an original party to
this Agreement or as the assignee of another Lender), (d) the successor (whether
by transfer of assets, merger or otherwise) to all or substantially all of the
commercial lending business of the assigning Lender, or (e) any other Person
that has been approved in writing as an Eligible Assignee by the Borrower and
the Administrative Agent.
"Employee Benefit Plan" means any employee benefit plan within the meaning
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of Section 3(3) of ERISA which (a) is maintained for employees of the Borrower
or any ERISA Affiliate or (b) has at any time within the preceding six years
been maintained for the employees of the Borrower or any current or former ERISA
Affiliate.
"Environmental Laws" means any and all federal, state and local laws,
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statutes, ordinances, rules, regulations, permits, licenses, approvals and
orders of courts or Governmental Authorities, relating to the protection of
human health or the environment, including, but not limited to, requirements
pertaining to the manufacture, processing, distribution, use, treatment,
storage,
disposal, transportation, handling, reporting, licensing, permitting,
investigation or remediation of Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, and the
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rules and regulations thereunder, each as amended or modified from time to time.
"ERISA Affiliate" means any Person who together with the Borrower is
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treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Code or Section 4001(b) of ERISA.
"Eurodollar Reserve Percentage" means, for any day, the percentage
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(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities or any similar category of liabilities for
any Lender.
"Event of Default" means any of the events specified in Section 10.1,
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provided that any requirement for passage of time, giving of notice, or both,
has been satisfied.
"FCC" means the Federal Communications Commission or any successor
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Governmental Authority.
"FCC License" means any license, permit, consent, certificate of
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compliance, franchise, approval, waiver or authorization granted or issued by
the FCC.
"FDIC" means the Federal Deposit Insurance Corporation, or any successor
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thereto.
"Federal Funds Rate" means the rate per annum (rounded upwards, if
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necessary, to the next higher 1/100th of 1%) representing the daily effective
federal funds rate as quoted by the Administrative Agent and confirmed in
Federal Reserve Board Statistical Release H.15 (519) or any successor or
substitute publication selected by the Administrative Agent. If, for any
reason, such rate is not available, then "Federal Funds Rate" shall mean a daily
rate which is determined, in the opinion of the Administrative Agent, to be the
rate at which federal funds are being offered for sale in the national federal
funds market at 9:00 a.m. (Charlotte time). Rates for weekends or holidays
shall be the same as the rate for the most immediate preceding Business Day.
"$15 Million Facility" means a credit facility for up to $15,000,000 in
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favor of the Borrower with a maturity of no more than two years, secured by a
pledge of the capital stock of Mercom owned by the Borrower, which facility will
be assumed by CCSM as part of the Mercom Contribution.
"First Union" means First Union National Bank, a national banking
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association, and its successors.
"Fiscal Year" means the fiscal year of the Borrower and its Designated
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Subsidiaries ending on December 31.
"Fixed Charges" means, with respect to any Person for any period, the sum
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of the following for such period calculated in accordance with GAAP: (a)
Interest Expense plus (b) scheduled principal payments with respect to Debt
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(regardless of whether such amounts were actually paid).
"GAAP" means generally accepted accounting principles, as recognized by the
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American Institute of Certified Public Accountants and the Financial Accounting
Standards Board, consistently applied and maintained on a consistent basis
throughout the period indicated and consistent with prior financial practice
(except for changes in such practice with which the Borrowers' independent
certified public accountants have concurred).
"Governmental Approvals" means all authorizations, consents, approvals,
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licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities, including without limitation any FCC License or PUC
Authorization.
"Governmental Authority" means any nation, province, state or political
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subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing, including
without limitation the FCC and any PUC.
"Guaranty Obligation" means, with respect to any Person, without
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duplication, any obligation, contingent or otherwise, of any such Person
pursuant to which such Person has directly or indirectly guaranteed any Debt of
any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of any such Person (a)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Debt (whether arising by virtue of partnership arrangements, by agreement
to keep well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement condition or otherwise) or (b) entered into
for the purpose of assuring in any other manner the obligee of such Debt of the
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided, that the term Guaranty Obligation shall not include
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endorsements for collection or deposit in the ordinary course of business.
"Hazardous Materials" means any substances or materials (a) which are or
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become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
applicable Environmental Law, (b) which are toxic, explosive, corrosive,
flammable, infectious, radioactive, carcinogenic, mutagenic or otherwise harmful
to human health or the environment and are or become regulated by any applicable
Environmental Law, (c) the presence of which require remediation under any
Environmental Law or common law, (d) the discharge or emission or release of
which requires a permit or license under any Environmental Law or other
Governmental Approval, (e) which are materials consisting of underground or
aboveground storage tanks, whether empty, filled or partially filled with any
substance or (f) which contain asbestos, polychlorinated biphenyls, urea
formaldehyde foam
insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude
oil, nuclear fuel, natural gas or synthetic gas.
"Hedging Agreement" means any agreement with respect to an interest rate
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swap, collar, cap, floor or a forward rate agreement or other agreement
regarding the hedging of interest rate risk exposure executed in connection with
hedging the interest rate exposure of the Borrower under this Agreement, and any
confirming letter executed pursuant to such hedging agreement, all as amended,
restated or otherwise modified.
"Interest Expense" means, with respect to any Person for any period, the
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interest expense as determined for such period in accordance with GAAP.
"Interest Period" shall have the meaning assigned thereto in Section
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3.1(b).
"Lender" means each Person executing this Agreement as a Lender set forth
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on the signature pages hereto and each Person that hereafter becomes a party to
this Agreement as a Lender pursuant to Section 12.10.
"Lending Office" means, with respect to any Lender, the office of such
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Lender maintaining such Lender's Commitment Percentage of the Loans.
"Leverage Ratio" means as of any date of determination, the ratio as of
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such date determined in accordance with Section 8.1.
"LIBOR" means the rate for deposits in Dollars for a period equal to the
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Interest Period selected which appears on the Telerate Page 3750 at
approximately 11:00 a.m. London time, two (2) Business Days prior to the
commencement of the applicable Interest Period. If, for any reason, such rate
is not available, then "LIBOR" shall mean the rate per annum at which, as
determined by the Administrative Agent, Dollars in the amount of $5,000,000 are
being offered to leading banks at approximately 11:00 a.m. London time, two (2)
Business Days prior to the commencement of the applicable Interest Period for
settlement in immediately available funds by leading banks in the London
interbank market for a period equal to the Interest Period selected.
"LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to the
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next higher 1/100th of 1%) determined by the Administrative Agent pursuant to
the following formula:
LIBOR Rate = LIBOR
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1.00-Eurodollar Reserve Percentage
"LIBOR Rate Loan" means any Loan bearing interest at a rate based upon the
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LIBOR Rate as provided in Section 3.1(a).
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
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charge, security interest or encumbrance of any kind in respect of such asset.
For the purposes of this Agreement, a
Person shall be deemed to own subject to a Lien any asset which it has acquired
or holds subject to the interest of a vendor or lessor under any conditional
sale agreement, Capital Lease or other title retention agreement relating to
such asset.
"Loan" means any loan made to the Borrower pursuant to Section 2.1 and all
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such Loans collectively as the context requires.
"Loan Documents" means, collectively, this Agreement, the Notes, any
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Hedging Agreement executed by any Lender and each other document referenced in
Article V or otherwise required to be delivered by or on behalf of the Borrower
or its Designated Subsidiaries pursuant to this Agreement, all as may be
amended, restated or otherwise modified.
"Material Adverse Effect" means a material adverse effect on the business,
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operations or financial condition of the Borrower and its Designated
Subsidiaries, taken as a whole, or the ability of the Borrower to perform its
obligations under the Loan Documents to which it is a party.
"Material Contract" means any written contract or other agreement of the
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Borrower or any of its Designated Subsidiaries (other than one evidencing Debt,
providing for the acquisition or construction of Capital Assets or the making of
any Investment (including by way of merger) permitted by Section 9.3 (and, if
applicable, Section 9.4)) involving monetary liability of any such Person in an
amount in excess of $3,000,000 per annum.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
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4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or
is accruing an obligation to make, contributions within the preceding six years.
"Net Cash Proceeds" means, as applicable with respect to any Person, (a)
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with respect to any sale, trade or other disposition of assets, the gross cash
proceeds received by such Person from such sale less the sum of (i) all income
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taxes and other taxes assessed by a Governmental Authority as a result of such
sale and any other reasonable fees and expenses incurred in connection therewith
and (ii) the principal amount of, premium, if any, and interest on any Debt
secured by a Lien on the asset (or a portion thereof) sold, which Debt is
required to be and is repaid in connection with such sale, (b) with respect to
any issuance of Debt, the gross cash proceeds received by such Person therefrom
less all legal, underwriting and other reasonable fees and expenses incurred in
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connection therewith and the amount thereof applied to repay existing Debt
permitted by Section 9.1 and (c) with respect to any payment under an insurance
policy or in connection with a condemnation proceeding, the amount of cash
proceeds received by such Person from an insurance company or Governmental
Authority net of all reasonable expenses of collection.
"Net Income" means, with respect to any Person for any period, the net
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income (or loss) of such Person for such period determined in accordance with
GAAP; provided, that there shall be excluded from net income the income of any
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Person (other than a Wholly-Owned Subsidiary) in which such Person has an
ownership interest, except to the extent received in cash by such Person.
"Net Worth" means, with respect to any Person at any time and without
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duplication, total assets of such Person, less total liabilities of such Person,
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in each case determined in accordance with GAAP.
"Notes" means the revolving credit notes made by the Borrower payable to
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the order of each Lender, substantially in the form of Exhibit A, evidencing the
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Debt incurred by the Borrower pursuant to the Revolving Credit Facility, and any
amendments and modifications thereto, any substitutes therefor, and any
replacements, restatements, renewals or extension thereof, in whole or in part.
"Notice of Account Designation" shall have the meaning assigned thereto in
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Section 2.2(b).
"Notice of Borrowing" shall have the meaning assigned thereto in Section
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2.2(a).
"Notice of Conversion/Continuation" shall have the meaning assigned thereto
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in Section 3.2.
"Notice of Payment" shall have the meaning assigned thereto in Section
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2.3(d).
"Obligations" means, in each case, whether now in existence or hereafter
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arising: (a) the principal of and interest on (including interest accruing after
the filing of any bankruptcy or similar petition) the Loans and (b) all other
fees and commissions (including attorney's fees), charges, indebtedness, loans,
liabilities, financial accommodations, obligations, covenants and duties owing
by the Borrower to the Lenders or the Administrative Agent, of every kind,
nature and description, direct or indirect, absolute or contingent, due or to
become due, contractual or tortious, liquidated or unliquidated, and whether or
not evidenced by any note, and whether or not for the payment of money under or
in respect of this Agreement, any Note, any Hedging Agreement with a Lender or
Affiliate thereof or any of the other Loan Documents.
"Officer's Compliance Certificate" shall have the meaning assigned thereto
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in Section 6.2.
"Operating Cash Flow" means, with respect to any Person for any period, the
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following, calculated without duplication for such period in accordance with
GAAP: (a) Net Income, plus (b) to the extent deducted in determining Net Income,
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(i) income and franchise taxes, (ii) Interest Expense and (iii) depreciation,
amortization (including amortization of goodwill and other intangibles) and
other non-cash charges, minus (c) to the extent included in determining Net
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Income, any items of extraordinary, unusual or non-recurring gain or loss
(together with any related provision for taxes on such gain). For any
acquisition or sale by such Person during any period of calculation, the
definition of Operating Cash Flow shall be adjusted on a pro forma basis in a
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manner reasonably satisfactory to the Administrative Agent to give effect to
such acquisition or sale as if such acquisition or sale occurred on the first
day of such period.
"Other Taxes" shall have the meaning assigned thereto in Section 3.11(c).
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"PBGC" means the Pension Benefit Guaranty Corporation or any successor
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agency.
"Pension Plan" means any Employee Benefit Plan, other than a Multiemployer
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Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of
the Code and which (a) is maintained for employees of the Borrower or any ERISA
Affiliates or (b) has at any time within the preceding six years been maintained
for the employees of the Borrower or any of their current or former ERISA
Affiliates.
"Person" means an individual, corporation, partnership, limited liability
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company, limited liability partnership, association, trust, business trust,
joint venture, joint stock company, pool, syndicate, sole proprietorship,
unincorporated organization, Governmental Authority or any other form of entity
or group thereof.
"Prime Rate" means, at any time, the rate of interest per annum publicly
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announced from time to time by First Union as its prime rate. Each change in
the Prime Rate shall be effective as of the opening of business on the day such
change in the Prime Rate occurs. The parties hereto acknowledge that the rate
announced publicly by First Union as its Prime Rate is an index or base rate and
shall not necessarily be its lowest or best rate charged to its customers or
other banks.
"PUC" means any state regulatory agency or body that exercises jurisdiction
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over the rates or services or the acquisition, construction or operation of any
telecommunications system or any person who owns, constructs or operates any
telecommunications system, in each case by reason of the nature or type of the
business subject to regulation and not pursuant to laws and regulations of
general applicability to Persons conducting business in said state.
"PUC Authorization" means any license, permit, consent, certificate of
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compliance, franchise, approval, waiver or authorization granted or issued by a
PUC.
"Register" shall have the meaning assigned thereto in Section 12.10(d).
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"Reorganization" means the reorganization described in Schedule 1.1(b), as
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such Schedule may be supplemented or otherwise amended with the prior written
approval of the Required Lenders.
"Required Lenders" means, at any date, any combination of holders of at
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least fifty-one percent (51%) of the aggregate unpaid principal amount of the
Notes, or if no amounts are outstanding under the Notes, any combination of
Lenders whose Commitment Percentages aggregate at least fifty-one percent (51%).
"Revolving Credit Facility" means the revolving credit facility established
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pursuant to Article II hereof.
"Solvent" means, as to the Borrower and its Designated Subsidiaries on a
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particular date, that such Persons, taken as a whole and on a Combined basis (a)
have capital sufficient to carry on their business and transactions and all
business and transactions in which they are about to engage and are able to pay
their debts as they mature, (b) own property having a value, both at fair
valuation and at present fair saleable value, greater than the amount required
to pay their probable liabilities (including contingencies), and (c) do not
believe that they will incur debts or liabilities beyond their ability to pay
such debts or liabilities as they mature.
"Subsidiary" means as to any Person, any corporation, partnership or other
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entity of which more than fifty percent (50%) of the outstanding capital stock
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other managers of such corporation, partnership or
other entity is at the time, directly or indirectly, owned by or the management
is otherwise controlled by such Person (irrespective of whether, at the time,
capital stock of any other class or classes of such corporation shall have or
might have voting power by reason of the happening of any contingency).
"Taxes" shall have the meaning assigned thereto in Section 3.11(a).
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"Termination Date" means the earliest of the dates referred to in Section
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2.6.
"Termination Event" means: (a) a "Reportable Event" described in Section
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4043 of ERISA (as to which the thirty (30) day notice requirement has not been
waived by the PBGC), or (b) the withdrawal of the Borrower or any ERISA
Affiliate from a Pension Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA, or (c) the filing of a
notice of intent to terminate a Pension Plan under Section 4041(c) of ERISA, or
(d) the institution of proceedings under Section 4042 of ERISA to terminate, or
the appointment of a trustee with respect to, any Pension Plan by the PBGC, or
(e) any other event or condition which would reasonably constitute grounds under
Section 4042(a) of ERISA for the termination of, or the appointment of a trustee
to administer, any Pension Plan, or (f) the partial or complete withdrawal of
the Borrower or any ERISA Affiliate from a Multiemployer Plan, or (g) the
imposition of a Lien pursuant to Section 412 of the Code or Section 302 of
ERISA, or (h) any event or condition which results in the reorganization or
insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or (i)
any event or condition which results in the termination of a Multiemployer Plan
under Section 4041A of ERISA or the institution by PBGC of proceedings to
terminate a Multiemployer Plan under Section 4042 of ERISA.
"Total Debt" means, with respect to any Person at any date and without
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duplication, the sum of the following calculated in accordance with GAAP: (a)
all liabilities, obligations and indebtedness for borrowed money including but
not limited to obligations evidenced by bonds, debentures, notes or other
similar instruments of any such Person, (b) all obligations to pay the deferred
purchase price of property or services of any such Person, except trade payables
arising in the ordinary course of business not more than ninety (90) days past
due, (c) all obligations of any such Person as lessee under Capital Leases and
(d) all Guaranty Obligations of any such Person.
"United States" means the United States of America.
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"Wholly-Owned" means, with respect to a Subsidiary, a Subsidiary all of the
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shares of capital stock or other ownership interests of which are, directly or
indirectly, owned or controlled by any Person and/or one or more of its Wholly-
Owned Subsidiaries.
SECTION 1.2 General. Unless otherwise specified, a reference in this
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Agreement to a particular section, subsection, Schedule or Exhibit is a
reference to that section, subsection, Schedule or Exhibit of this Agreement.
Wherever from the context it appears appropriate, each term stated in either the
singular or plural shall include the singular and plural, and pronouns stated in
the masculine, feminine or neuter gender shall include the masculine, the
feminine and the neuter. Any reference herein to "Charlotte time" shall refer
to the applicable time of day in Charlotte, North Carolina. Unless expressly
specified otherwise, any references to the "transactions contemplated by this
Agreement" or the "transactions contemplated hereby" (or similar references)
shall not be a reference to the Reorganization. Unless expressly specified
otherwise, capitalized terms defined in Schedule 1.1(b) are used herein with the
---------------
meanings assigned to such terms in such Schedule.
SECTION 1.3 Other Definitions and Provisions.
--------------------------------
(a) Use of Capitalized Terms. Unless otherwise defined therein, all
------------------------
capitalized terms defined in this Agreement shall have the defined meanings when
used in this Agreement, the Notes and the other Loan Documents or any
certificate, report or other document made or delivered pursuant to this
Agreement.
(b) Miscellaneous. The words "hereof", "herein" and "hereunder" and words
-------------
of similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement.
ARTICLE II
REVOLVING CREDIT FACILITY
-------------------------
SECTION 2.1 Revolving Credit Loans. Subject to the terms and conditions
----------------------
of this Agreement, each Lender severally agrees to make Loans to the Borrower
from time to time from the Closing Date through the Termination Date as
requested by the Borrower in accordance with the terms of Section 2.2; provided,
--------
that (a) the aggregate principal amount of all outstanding Loans (after giving
effect to any amount requested) shall not exceed the Commitment of all Lenders
and (b) the principal amount of outstanding Loans from any Lender to the
Borrower shall not at any time exceed such Lender's Commitment. Each Loan by a
Lender shall be in a principal amount equal to such Lender's Commitment
Percentage of the aggregate principal amount of Loans requested on such
occasion. Subject to the terms and conditions hereof, the Borrower may borrow,
repay and reborrow Loans hereunder until the Termination Date.
SECTION 2.2 Procedure for Advances of Loans.
-------------------------------
(a) Requests for Borrowing. The Borrower shall give the Administrative
----------------------
Agent irrevocable prior written notice in the form attached hereto as Exhibit B
---------
(a "Notice of Borrowing") not later than 11:00 a.m. (Charlotte time) (i) on the
same Business Day as each Base Rate Loan and
(ii) at least three (3) Business Days before each LIBOR Rate Loan, of its
intention to borrow, specifying (A) the date of such borrowing, which shall be a
Business Day, (B) the amount of such borrowing, which shall be in an aggregate
principal amount of $2,000,000 or a whole multiple of $500,000 in excess
thereof, (C) whether the Loans are to be LIBOR Rate Loans or Base Rate Loans
(provided that LIBOR Rate Loans shall not be available until three (3) Business
Days after the Closing Date) and (D) in the case of a LIBOR Rate Loan, the
duration of the initial Interest Period applicable thereto. Notices received
after 11:00 a.m. (Charlotte time) shall be deemed received on the next Business
Day. The Administrative Agent shall promptly notify the Lenders of each Notice
of Borrowing.
(b) Disbursement of Loans. Not later than 2:00 p.m. (Charlotte time) on
---------------------
the proposed borrowing date, each Lender will make available to the
Administrative Agent, for the account of the Borrower, at the office of the
Administrative Agent in funds immediately available to the Administrative Agent,
such Lender's Commitment Percentage of the Loans to be made on such borrowing
date. The Borrower hereby irrevocably authorizes the Administrative Agent to
disburse the proceeds of the borrowing requested pursuant to this Section 2.2 in
immediately available funds by crediting or wiring such proceeds to the deposit
account of the Borrower identified in the most recent Notice of Account
Designation substantially in the form of Exhibit G (a "Notice of Account
---------
Designation") delivered by the Borrower to the Administrative Agent or as may be
otherwise agreed upon by the Borrower and the Administrative Agent from time to
time. Subject to Section 3.7 hereof, the Administrative Agent shall not be
obligated to disburse the portion of the proceeds of any Loan requested pursuant
to this Section 2.2 to the extent that any Lender has not made available to the
Administrative Agent its Commitment Percentage of such Loan.
SECTION 2.3 Repayment of Loans.
------------------
(a) Repayment on Termination Date. The Borrower shall repay the
-----------------------------
outstanding principal amount of all Loans in full, together with all accrued but
unpaid interest thereon, on the Termination Date.
(b) Mandatory Repayment of Excess Loans. If at any time the outstanding
-----------------------------------
principal amount of all Loans exceeds the Commitment, the Borrower shall repay
immediately upon notice from the Administrative Agent, by payment to the
Administrative Agent for the account of the Lenders, the Loans in an amount
equal to such excess.
(c) Other Mandatory Repayments.
--------------------------
(i) Sale of Assets. The Borrower shall make mandatory principal
--------------
payments of the Loans in amounts equal to 100% of the aggregate Net Cash
Proceeds in excess of $2,000,000 received after the date hereof by the Borrower
or any of its Designated Subsidiaries from any sale, trade or other disposition
of assets permitted by Section 9.5(e); provided, that (A) such payment shall be
--------
made only at such time as such Net Cash Proceeds required to be paid but not
previously applied equal $250,000 or any whole multiple thereof (at which time
the entire unapplied amount shall be paid) and (B) unless (1) any Default in the
payment of any interest or fees under this Agreement or Event of Default has
occurred and is continuing at the time of such sale, trade or
disposition or (2) such Net Cash Proceeds result from a sale of capital stock or
other equity interest of a Subsidiary of the Borrower, no such payment shall be
required if and to the extent such Net Cash Proceeds are reinvested in the
business of the Borrower and its Designated Subsidiaries within one hundred
eighty (180) days after such sale, trade or disposition.
(ii) Insurance. The Borrower shall make mandatory principal
---------
payments of the Loans in amounts equal to 100% of the Net Cash Proceeds received
by the Borrower or any of its Designated Subsidiaries from any insurance policy
if such Net Cash Proceeds (i) exceed $500,000 in the aggregate for any loss or
series of related losses and (ii) are not reinvested in the business of the
Borrower and its Designated Subsidiaries within one hundred eighty (180) days of
receipt; provided, that if any Default in the payment of any interest or fees
--------
under this Agreement or Event of Default has occurred and is continuing at the
time of such receipt, the Borrower shall not have the option to make any such
reinvestment and shall make such mandatory payment in accordance with paragraph
(iv) of this Section 2.3(c).
(iii) Issuance of Debt. The Borrower shall make mandatory principal
----------------
payments of the Loans in amounts equal to 100% of the Net Cash Proceeds from the
issuance of any Debt of the Borrower or any of its Designated Subsidiaries
incurred after the Closing Date (other than any Loans hereunder or Debt of the
character described in Section 9.1(e)), if after the issuance of such Debt, the
Leverage Ratio exceeds 3.0 to 1.0. (For purposes of determining the Leverage
Ratio with respect to this Section 2.3(c)(iii), Total Debt of the Borrower and
its Designated Subsidiaries shall be calculated on each date the Borrower or any
of its Designated Subsidiaries receives any such Net Cash Proceeds.)
(iv) Notice; Manner of Payments. Upon the occurrence of any event
--------------------------
triggering the repayment requirement under this Section 2.3(c), the Borrower
shall give prompt written notice of such event and the amount of the
corresponding prepayment to the Administrative Agent and upon receipt of such
notice, the Administrative Agent shall promptly so notify the Lenders. Each
mandatory prepayment required under Section 2.3(c) shall be made within three
(3) Business Days of such event and shall be applied to repay the outstanding
principal amount of Loans.
(d) Optional Repayments. The Borrower may at any time and from time to
-------------------
time repay the Loans, in whole or in part, upon at least three (3) Business
Days' irrevocable notice to the Administrative Agent with respect to LIBOR Rate
Loans and one (1) Business Day irrevocable notice with respect to Base Rate
Loans, in the form attached hereto as Exhibit C (a "Notice of Payment")
---------
specifying the date and amount of repayment and whether the repayment is of
LIBOR Rate Loans, Base Rate Loans, or a combination thereof, and, if of a
combination thereof, the amount allocable to each. Upon receipt of such notice,
the Administrative Agent shall promptly notify each Lender. If any such notice
is given, the amount specified in such notice shall be due and payable on the
date set forth in such notice. Partial repayments shall be in an aggregate
amount of $2,000,000 or a whole multiple of $500,000 in excess thereof with
respect to Base Rate Loans, and $2,000,000 or a whole multiple of $500,000 in
excess thereof with respect to LIBOR Rate Loans.
(e) Limitation on Repayment of LIBOR Rate Loans. Any repayment of any
-------------------------------------------
LIBOR Rate Loan under this Section 2.3 on any day other than on the last day of
the Interest Period applicable thereto shall be accompanied by any amount
required to be paid pursuant to Section 3.9.
SECTION 2.4 Revolving Credit Notes. Each Lender's Loans and the
----------------------
obligation of the Borrower to repay such Loans shall be evidenced by a Note
payable to the order of such Lender. Each Note shall bear interest on the
unpaid principal amount thereof at the applicable interest rate per annum
specified in Section 3.1.
SECTION 2.5 Permanent Reduction of the Commitment.
-------------------------------------
(a) The Borrower shall have the right at any time and from time to time,
upon at least five (5) Business Days prior written notice to the Administrative
Agent, to permanently reduce, in whole at any time or in part from time to time,
without premium or penalty, the Commitment in an aggregate principal amount not
less than $2,000,000 or any whole multiple of $500,000 in excess thereof.
(b) Each permanent reduction permitted pursuant to this Section 2.5 shall
be accompanied by a payment of principal sufficient to reduce the aggregate
principal amount of Loans to the Commitment as so reduced. Any reduction of the
Commitment to zero shall be accompanied by payment of all outstanding
Obligations and, if such reduction is permanent, termination of the Commitment
and Revolving Credit Facility. If the reduction of the Commitment requires the
repayment of any LIBOR Rate Loan, such reduction may be made only on the last
day of the then current Interest Period applicable thereto unless such repayment
is accompanied by any amount required to be paid pursuant to Section 3.9 hereof.
SECTION 2.6 Termination of Revolving Credit Facility. The Revolving
----------------------------------------
Credit Facility shall terminate on the earliest of (a) June 30, 2002, (b) the
date of termination of the Commitments in whole by the Borrower pursuant to
Section 2.5(a), and (c) the date of termination of the Commitments in whole by
the Administrative Agent on behalf of the Lenders pursuant to Section 10.2(a).
SECTION 2.7 $15 Million Facility. (a) For so long as any amount remains
--------------------
outstanding under the $15 Million Facility but only so long as all of the
obligations under the $15 Million Facility have not been assumed by CCSM, the
Borrower shall not give a Notice of Borrowing if, after giving effect thereto
and any concurrent transactions (including a concurrent repayment of the $15
Million Facility with the proceeds of such a borrowing) the aggregate principal
amount of the Loans would exceed (i) the Commitment of all Lenders minus (ii)
the outstanding principal amount of the $15 Million Facility.
(b) The Borrower agrees that, until such time as all of the
obligations under the $15 Million Facility are assumed by CCSM, if
(i) the Distributions do not take place by December 31, 1997;
(ii) the $15 Million Facility matures and is not repaid from
other funds; or
(iii) an event of default under the $15 Million Facility occurs,
it will give a Notice of Borrowing solely for the purpose of obtaining
moneys to be applied, and which shall be applied solely, to the payment of all
outstanding obligations under the $15 Million Facility; provided, that such
--------
Notice of Borrowing (and any representations and warranties deemed made in
connection therewith or with the related borrowing) may be qualified to the
extent the Borrower is unable to make the statements required to be made therein
without such qualification. Such Notice of Borrowing shall equal the amount of
the outstanding obligations under the $15 Million Facility without regard to the
minimum increments set forth in Section 2.2(a) and shall be given
notwithstanding the existence of any Default or Event of Default. The
obligation of the Lenders to fund a Loan pursuant to a Notice of Borrowing given
pursuant to this Section 2.7(b) is absolute and unconditional and shall not be
affected by the existence of any Default or Event of Default or any other
circumstance whatsoever; provided, that if prior to the funding of a Loan
--------
pursuant to a Notice of Borrowing given pursuant to this Section 2.7(b), one of
the events described in Section 10.1(i) or (j) shall have occurred and all of
the obligations under the $15 Million Facility have not been assumed by CCSM,
each such Lender will, on the date the applicable Loan would have been made,
purchase an undivided participating interest in the $15 Million Facility in an
amount equal to its Commitment Percentage of the aggregate amount outstanding
under the $15 Million Facility.
ARTICLE III
GENERAL LOAN PROVISIONS
-----------------------
SECTION 3.1 Interest.
--------
(a) Interest Rate Options. Subject to the provisions of this Section
---------------------
3.1, at the election of the Borrower, the aggregate principal balance of the
Loans or any portion thereof shall bear interest at the Base Rate or the LIBOR
Rate plus, in each case, the Applicable Margin as set forth below (provided
----
that the LIBOR Rate shall not be available until three (3) Business Days after
the Closing Date). The Borrower shall select the rate of interest and Interest
Period, if any, applicable to any Loan at the time a Notice of Borrowing is
given pursuant to Section 2.2 or at the time a Notice of Conversion/Continuation
is given pursuant to Section 3.2. Each Loan or portion thereof bearing interest
based on the Base Rate shall be a "Base Rate Loan" and each Loan or portion
thereof bearing interest based on the LIBOR Rate shall be a "LIBOR Rate Loan".
Any Loan or any portion thereof as to which the Borrower has not duly specified
an interest rate as provided herein shall be deemed a Base Rate Loan.
(b) Interest Periods. In connection with each LIBOR Rate Loan, the
----------------
Borrower, by giving notice at the times described in Section 3.1(a), shall elect
an interest period (each, an "Interest Period") to be applicable to such Loan,
which Interest Period shall be a period of one (1), two (2), three (3), or six
(6) months with respect to each LIBOR Rate Loan; provided that:
--------
(i) the Interest Period shall commence on the date of advance of or
conversion to any LIBOR Rate Loan and, in the case of immediately successive
Interest Periods, each successive Interest Period shall commence on the date on
which the next preceding Interest Period expires;
(ii) if any Interest Period would otherwise expire on a day that is
not a Business Day, such Interest Period shall expire on the next succeeding
Business Day; provided, that if any Interest Period with respect to a LIBOR Rate
--------
Loan would otherwise expire on a day that is not a Business Day but is a day of
the month after which no further Business Day occurs in such month, such
Interest Period shall expire on the next preceding Business Day;
(iii) any Interest Period with respect to a LIBOR Rate Loan that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of the relevant calendar
month at the end of such Interest Period;
(iv) no Interest Period shall extend beyond the Termination Date, and
no interest period shall be selected by the Borrower which would result in the
repayment of any LIBOR Rate Loan prior to the end of an Interest Period; and
(v) there shall be no more than ten (10) Interest Periods
outstanding at any time.
(c) Applicable Margin. The Applicable Margin provided for in Section
-----------------
3.1(a) with respect to the Loans (the "Applicable Margin") shall (i) on the
Closing Date equal the percentages set forth in the certificate delivered
pursuant to Section 4.2(d)(iv) and (ii) for each fiscal quarter thereafter be
determined by reference to the Leverage Ratio as of the end of the fiscal
quarter immediately preceding the delivery of the applicable Officer's
Compliance Certificate as follows:
Applicable Margin Per Annum
Leverage Ratio Base Rate + LIBOR Rate +
-------------- -------------------------------
greater than 3.00x 0.00% .750%
greater than 2.50 less than or equal to 3.00x 0.00% .625%
greater than 2.00 less than or equal to 2.50x 0.00% .500%
less than or equal to 2.00x 0.00% .425%
Adjustments, if any, in the Applicable Margin shall be made by the
Administrative Agent on the fifth (5th) Business Day after receipt by the
Administrative Agent of quarterly financial statements for the Borrower and its
Designated Subsidiaries and the accompanying Officer's Compliance Certificate
setting forth the Leverage Ratio of the Borrower and its Designated Subsidiaries
as of the most recent fiscal quarter end. Subject to Section 3.1(d), in the
event the Borrower fails to deliver such financial statements and certificate
within the time required by Section 6.2 hereof, the
Applicable Margin shall be the highest Applicable Margin set forth above until
the delivery of such financial statements and certificate.
(d) Default Rate. Upon the occurrence and during the continuance of an
------------
Event of Default, (i) the Borrower shall no longer have the option to request
LIBOR Rate Loans, (ii) all outstanding LIBOR Rate Loans which are past due shall
bear interest at a rate per annum two percent (2%) in excess of the rate then
applicable to LIBOR Rate Loans until the end of the applicable Interest Period
and thereafter at a rate equal to two percent (2%) in excess of the rate then
applicable to Base Rate Loans, and (iii) all outstanding Base Rate Loans which
are past due shall bear interest at a rate per annum equal to two percent (2%)
in excess of the rate then applicable to Base Rate Loans.
(e) Interest Payment and Computation. Interest on each Base Rate Loan
--------------------------------
shall be payable in arrears on the last Business Day of each calendar quarter
commencing September 30, 1997; and interest on each LIBOR Rate Loan shall be
payable on the last day of each Interest Period applicable thereto, and if such
Interest Period extends over three (3) months, at the end of each three (3)
month interval during such Interest Period. Interest for all Base Rate Loans
provided hereunder and all fees shall be computed on the basis of a 365-day year
or 366-day year, as applicable, and assessed for the actual number of days
elapsed. All interest for LIBOR Rate Loans provided hereunder shall be computed
on the basis of a 360-day year and assessed for the actual number of days
elapsed.
(f) Maximum Rate. In no contingency or event whatsoever shall the
------------
aggregate of all amounts deemed interest hereunder or under any of the Notes
charged or collected pursuant to the terms of this Agreement or pursuant to any
of the Notes exceed the highest rate permissible under any Applicable Law which
a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that the Lenders
have charged or received interest hereunder in excess of the highest applicable
rate, the rate in effect hereunder shall automatically be reduced to the maximum
rate permitted by Applicable Law and the Lenders shall at the Administrative
Agent's option promptly refund to the Borrower any interest received by the
Lenders in excess of the maximum lawful rate or shall apply such excess to the
principal balance of the Obligations. It is the intent hereof that the Borrower
not pay or contract to pay, and that neither the Administrative Agent nor any
Lender receive or contract to receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may be paid by the Borrower under
Applicable Law.
SECTION 3.2 Notice and Manner of Conversion or Continuation of Loans.
--------------------------------------------------------
Provided that no Event of Default has occurred and is then continuing, the
Borrower shall have the option to (a) convert at any time all or any portion of
its outstanding Base Rate Loans in a principal amount equal to $2,000,000 or any
whole multiple of $500,000 in excess thereof into one or more LIBOR Rate Loans
or (b) upon the expiration of any Interest Period, (i) convert all or any part
of its outstanding LIBOR Rate Loans in a principal amount equal to $2,000,000 or
a whole multiple of $500,000 in excess thereof into Base Rate Loans or (ii)
continue such LIBOR Rate Loans as LIBOR Rate Loans. Whenever the Borrower
desires to convert or continue Loans as provided above, the Borrower shall give
the Administrative Agent irrevocable prior written notice in the
form attached as Exhibit D (a "Notice of Conversion/ Continuation") not later
---------
than 11:00 a.m. (Charlotte time) three (3) Business Days before the day on which
a proposed conversion or continuation of such Loan is to be effective specifying
(A) the Loans to be converted or continued, and, in the case of any LIBOR Rate
Loan to be converted or continued, the last day of the Interest Period therefor,
(B) the effective date of such conversion or continuation (which shall be a
Business Day), (C) the principal amount of such Loans to be converted or
continued, and (D) the Interest Period to be applicable to such converted or
continued LIBOR Rate Loan. The Administrative Agent shall promptly notify the
Lenders of such Notice of Conversion/Continuation.
SECTION 3.3 Fees.
----
(a) Commitment Fee. Commencing on the Closing Date, the Borrower shall pay
--------------
to the Administrative Agent, for the account of the Lenders, a non-refundable
commitment fee at a rate per annum equal to .20% on the average daily unused
portion of the Commitment. The commitment fee shall be payable in arrears on
the last Business Day of each calendar quarter during the term of this Agreement
commencing September 30, 1997, and on the Termination Date. Such commitment fee
shall be distributed by the Administrative Agent to the Lenders pro rata in
--- ----
accordance with the Lenders' respective Commitment Percentages.
(b) Administrative Agent's and Other Fees. In order to compensate the
-------------------------------------
Administrative Agent for structuring and syndicating the Loans and for its
obligations hereunder, the Borrower agrees to pay to the Administrative Agent,
for its account, the fees set forth in the separate fee letter agreement
executed by the Borrower and the Administrative Agent dated April 18, 1997.
SECTION 3.4 Manner of Payment. Each payment by the Borrower on account
-----------------
of the principal of or interest on the Loans or of any fee, commission or other
amounts payable to the Lenders under this Agreement or any Note shall be made
not later than 1:00 p.m. (Charlotte time) on the date specified for payment
under this Agreement to the Administrative Agent at the Administrative Agent's
Office for the account of the Lenders (other than as set forth below) pro rata
--- ----
in accordance with their respective Commitment Percentages, in Dollars, in
immediately available funds and shall be made without any set-off, counterclaim
or deduction whatsoever. Any payment received after such time but before 2:00
p.m. (Charlotte time) on such day shall be deemed a payment on such date for the
purposes of Section 11.1, but for all other purposes shall be deemed to have
been made on the next succeeding Business Day. Any payment received after 2:00
p.m. (Charlotte time) shall be deemed to have been made on the next succeeding
Business Day for all purposes. Upon receipt by the Administrative Agent of each
such payment, the Administrative Agent shall distribute to each Lender at its
address for notices set forth herein its pro rata share of such payment in
--- ----
accordance with such Lender's Commitment Percentage and shall wire advice of the
amount of such credit to each Lender. Each payment to the Administrative Agent
of Administrative Agent's fees or expenses shall be made for the account of the
Administrative Agent and any amount payable to any Lender under Sections 3.8,
3.9, 3.10, 3.11 or 12.2 shall be paid to the Administrative Agent for the
account of the applicable Lender.
SECTION 3.5 Crediting of Payments and Proceeds. In the event that the
----------------------------------
Borrower shall fail to pay any of the Obligations when due and the Obligations
have been accelerated pursuant to
Section 10.2, all payments received by the Lenders upon the Notes and the other
Obligations and all net proceeds from the enforcement of the Obligations shall
be applied first to all expenses then due and payable by the Borrower hereunder,
then to all indemnity obligations then due and payable by the Borrower
hereunder, then to all Administrative Agent's fees then due and payable, then to
all commitment and other fees and commissions then due and payable, then to
accrued and unpaid interest on the Notes (pro rata in accordance with all such
--- ----
amounts due) and then to the principal amount of the Notes, in that order.
SECTION 3.6 Adjustments. If any Lender (a "Benefitted Lender") shall at
-----------
any time receive any payment of all or part of its Loans, or interest thereon,
or if any Lender shall at any time receive any collateral in respect to its
Loans (whether voluntarily or involuntarily, by set-off or otherwise) in a
greater proportion than any such payment to and collateral received by any other
Lender, if any, in respect of such other Lender's Loans, or interest thereon,
such Benefitted Lender shall purchase for cash from the other Lenders such
portion of each such other Lender's Loans, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such Benefitted Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the Lenders;
provided, that if all or any portion of such excess payment or benefits is
--------
thereafter recovered from such Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned to the extent of such
recovery, but without interest. The Borrower agrees that, to the fullest extent
allowed by law, each Lender so purchasing a portion of another Lender's Loans
may exercise all rights of payment (including, without limitation, rights of
set-off) with respect to such portion as fully as if such Lender were the direct
holder of such portion.
SECTION 3.7 Nature of Obligations of Lenders Regarding Loans; Assumption
------------------------------------------------------------
by the Administrative Agent. The obligations of the Lenders under this
---------------------------
Agreement to make the Loans are several and are not joint or joint and several.
Unless the Administrative Agent shall have received notice from a Lender prior
to a proposed borrowing date that such Lender will not make available to the
Administrative Agent such Lender's ratable portion of the amount to be borrowed
on such date (which notice shall not release such Lender of its obligations
hereunder), the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the proposed borrowing date in
accordance with Section 2.2(b) and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If such amount is made available to the Administrative
Agent on a date after such borrowing date, such Lender shall pay to the
Administrative Agent on demand an amount, until paid, equal to the product of
(a) the amount of such Lender's Commitment Percentage of such borrowing, times
-----
(b) the daily average Federal Funds Rate during such period as determined by the
Administrative Agent, times (c) a fraction the numerator of which is the number
-----
of days that elapse from and including such borrowing date to the date on which
such Lender's Commitment Percentage of such borrowing shall have become
immediately available to the Administrative Agent and the denominator of which
is 360. A certificate of the Administrative Agent with respect to any amounts
owing under this Section shall be conclusive, absent manifest error. If such
Lender's Commitment Percentage of such borrowing is not made available to the
Administrative Agent by such Lender within three (3) Business Days of such
borrowing date, the Administrative Agent shall be entitled to recover such
amount made available by the
Administrative Agent with interest thereon at the rate per annum applicable to
Base Rate Loans hereunder, on demand, from the Borrower. The failure of any
Lender to make its Commitment Percentage of any Loan available shall not relieve
it or any other Lender of its obligation, if any, hereunder to make its
Commitment Percentage of such Loan available on such borrowing date, but no
Lender shall be responsible for the failure of any other Lender to make its
Commitment Percentage of such Loan available on the borrowing date.
SECTION 3.8 Changed Circumstances.
---------------------
(a) Circumstances Affecting LIBOR Rate Availability. If with respect to
-----------------------------------------------
any Interest Period:
(i) at least three (3) Lenders (or in any event the Required Lenders)
advise the Administrative Agent that, by reason of circumstances affecting
the foreign exchange and interbank markets generally, deposits in
eurodollars, in the applicable amounts are not being quoted via Telerate
Page 3750 or offered to such Lenders for such Interest Period, or
(ii) at least three (3) Lenders (or in any event the Required Lenders)
advise the Administrative Agent that the LIBOR Rate as determined by the
Administrative Agent will not adequately and fairly reflect the cost to
such Lenders of funding their LIBOR Rate Loans for such Interest Period,
then the Administrative Agent shall forthwith give prompt written notice thereof
to the Borrower and the Lenders. Thereafter, until the Administrative Agent
notifies the Borrower that such circumstances no longer exist, the obligation of
the Lenders to make LIBOR Rate Loans and the right of the Borrower to convert
any Loan to or continue any Loan as a LIBOR Rate Loan shall be suspended, and
the Borrower shall repay in full (or cause to be repaid in full) the then
outstanding principal amount of each such LIBOR Rate Loans together with accrued
interest thereon, on the last day of the then current Interest Period applicable
to such LIBOR Rate Loan or convert the then outstanding principal amount of each
such LIBOR Rate Loan to a Base Rate Loan as of the last day of such Interest
Period. Unless the Borrower notifies the Administrative Agent at least two
Business Days before the date of any affected borrowing or conversion or
continuation specified in any applicable Notice of Borrowing or Notice of
Conversion/Continuation that they elect not to borrow or convert or continue
Loans on the date specified therein, the Lenders shall make, convert or continue
the Loans in the amount specified by the Borrower in the applicable notice, but
such Loans shall be made, converted or continued as Base Rate Loans instead of
LIBOR Rate Loans.
(b) Laws Affecting LIBOR Rate Availability. If, after the date hereof, the
--------------------------------------
introduction of, or any change in, any Applicable Law or any change in the
interpretation or administration thereof by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or any of their respective Lending
Offices) with any request or directive (whether or not having the force of law)
of any such Authority, central bank or comparable agency, shall make it unlawful
or impossible for any of the Lenders (or any of their respective Lending
Offices) to honor its obligations hereunder to make or
maintain any LIBOR Rate Loan, such Lender shall promptly give notice thereof to
the Administrative Agent and the Administrative Agent shall promptly give notice
to the Borrower and the other Lenders. Thereafter, until such Lender notifies
the Administrative Agent and the Borrower that such circumstances no longer
exist, (i) the obligation of such Lender to make LIBOR Rate Loans, convert Base
Rate Loans into LIBOR Rate Loans or continue LIBOR Rate Loans as LIBOR Rate
Loans shall be suspended, and (ii) each LIBOR Rate Loan of such Lender then
outstanding shall be converted to a Base Rate Loan either (A) on the last day of
the then current Interest Period if such Lender may lawfully continue to
maintain and fund such Loan as a LIBOR Rate Loan to such day or (B) immediately
if such Lender shall determine that it may not lawfully continue to maintain and
fund such Loan as a LIBOR Rate Loan to such day.
(c) Increased Costs. If, after the date hereof, the introduction of, or
---------------
any change in, any Applicable Law, or in the interpretation or administration
thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any of the
Lenders (or any of their respective Lending Offices) with any request or
directive (whether or not having the force of law) of such Authority, central
bank or comparable agency:
(i) shall subject any of the Lenders (or any of their
respective Lending Offices) to any tax, duty or other charge with respect to any
Note or shall change the basis of taxation of payments to any of the Lenders (or
any of their respective Lending Offices) of the principal of or interest on any
Note or any other amounts due under this Agreement in respect thereof (except
for changes in the rate of tax on the overall net income of any of the Lenders
or any of their respective Lending Offices imposed by the jurisdiction in which
such Lender is organized or is or should be qualified to do business or such
Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors of the
Federal Reserve System), special deposit, insurance or capital or similar
requirement against assets of, deposits with or for the account of, or credit
extended by any of the Lenders (or any of their respective Lending Offices),
other than any such amount included in the calculation of Eurodollar Reserve
Percentage, or shall impose on any of the Lenders (or any of their respective
Lending Offices) or the foreign exchange and interbank markets any other
condition affecting any Note;
and the result of any of the foregoing is to increase the costs to any of the
Lenders of maintaining any LIBOR Rate Loan or to reduce the yield or amount of
any sum received or receivable by any of the Lenders under this Agreement or
under the Notes in respect of a LIBOR Rate Loan, then such Lender shall promptly
notify the Administrative Agent, and the Administrative Agent shall promptly
notify the Borrower of such fact and demand compensation therefor and, within
fifteen (15) days after such notice by the Administrative Agent, the Borrower
shall pay to such Lender such additional amount or amounts as will compensate
such Lender or Lenders for such increased cost or reduction. Each Lender will
promptly notify the Administrative Agent of any event of which it has knowledge
which will entitle such Lender to compensation pursuant to this Section 3.8(c)
and, after receipt of such notice, the Administrative Agent will promptly notify
the Borrower of such event; provided, that neither any Lender nor the
--------
Administrative Agent shall incur any
liability whatsoever to any other Lender or the Borrower in the event it fails
to do so. The amount of such compensation shall be determined, in the applicable
Lender's sole discretion, based upon the assumption that such Lender funded its
Commitment Percentage of the LIBOR Rate Loans in the London interbank market, as
applicable, and using any reasonable attribution or averaging methods which such
Lender deems appropriate and practical. A certificate of such Lender setting
forth the basis for determining such amount or amounts necessary to compensate
such Lender shall be forwarded to the Borrower through the Administrative Agent
and shall be conclusively presumed to be correct save for clearly demonstrable
error.
(d) The Borrower shall not be required to compensate a Lender for any
increased costs pursuant to this Section 3.8 incurred by such Lender more than
90 days prior to its request to the Administrative Agent for such compensation.
SECTION 3.9 Indemnity. The Borrower hereby indemnifies each of the
---------
Lenders against any reasonable loss or expense (excluding any loss of margin
over the LIBOR Rate for the period after any such payment or conversion or
failure to borrow, prepay or convert) which may arise or be attributable to each
Lender's obtaining, liquidating or employing deposits or other funds acquired to
effect, fund or maintain any Loan (a) as a consequence of any failure by the
Borrower to make any payment when due of any amount due hereunder in connection
with a LIBOR Rate Loan, (b) due to any failure of the Borrower to borrow on a
date specified therefor in a Notice of Borrowing or Notice of Continuation/
Conversion or (c) due to any payment, prepayment or conversion of any LIBOR Rate
Loan on a date other than the last day of the Interest Period therefor. The
amount of such loss or expense shall be determined, in good faith but otherwise
in the applicable Lender's sole discretion, based upon the assumption that such
Lender funded its Commitment Percentage of the LIBOR Rate Loans in the London
interbank market, and using any reasonable attribution or averaging methods
which such Lender deems appropriate and practical. A certificate of such Lender
setting forth the basis for determining such amount or amounts necessary to
compensate such Lender shall be forwarded to the Borrower through the
Administrative Agent and shall be conclusively presumed to be correct save for
clearly demonstrable error.
SECTION 3.10 Capital Requirements. If, after the date hereof, either (a)
--------------------
the introduction of, or any change in, or in the interpretation of, any
Applicable Law or (b) compliance with any guideline or request from any central
bank or comparable agency or other Governmental Authority (whether or not having
the force of law), has or would have the effect of reducing the rate of return
on the capital of, or has affected or would affect the amount of capital
required to be maintained by, any Lender or any corporation controlling such
Lender as a consequence of, or with reference to the Commitments and other
commitments of this type, below the rate which the Lender or such other
corporation could have achieved but for such introduction, change or compliance,
then within five (5) Business Days after written demand by any such Lender, the
Borrower shall pay to such Lender from time to time as specified in a reasonably
detailed calculation by such Lender additional amounts sufficient to compensate
such Lender or other corporation for such reduction. A certificate as to such
amounts submitted to the Borrower and the Administrative Agent by such Lender,
shall, in the absence of clearly demonstrable error, be presumed to be correct
and binding for all purposes. The Borrower will not be required to compensate a
Lender for
any increased amounts to this Section 3.10 incurred by such Lender more than 90
days prior to its request to the Borrower for such compensation.
SECTION 3.11 Taxes.
-----
(a) Payments Free and Clear. Any and all payments by the Borrower
-----------------------
hereunder or under the Notes shall be made free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholding, and all liabilities with respect thereto excluding (i)
taxes imposed on or measured by the overall net income of any Lender or its
Lending Office or the Administrative Agent or the Administrative Agent's Office,
as the case may be, and all franchise or similar taxes measured by capital or
net worth of such Lender or its Lending Office or the Administrative Agent or
the Administrative Agent's Office, as the case may be, in each case imposed: (A)
by the jurisdiction under the laws of which such Lender or the Administrative
Agent, as the case may be, is organized, or in which its principal executive
office is located, (B) by the jurisdiction in which the Lending Office of such
Lender or the Administrative Agent's Office, as applicable, is located or (C)
solely by reason of such Lender or the Administrative Agent, as the case may be,
doing business in the jurisdiction imposing such tax, other than as a result of
this Agreement or any Note or any transaction contemplated hereby and (ii) in
the case of each Lender, any United States withholding tax imposed on such
payments but only to the extent that such Lender is subject to United States
withholding tax at the time such Lender first becomes a party to this Agreement
(all such non-excluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities being hereinafter referred to as "Taxes"). If the Borrower
shall be required by law to deduct any Taxes from or in respect of any sum
payable hereunder or under any Note or to any Lender or the Administrative
Agent, (A) the sum payable shall be increased as may be necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 3.11) such Lender or the Administrative Agent
(as the case may be) receives an amount equal to the amount such party would
have received had no such deductions been made, (B) the Borrower shall make such
deductions, (C) the Borrower shall pay the full amount deducted to the relevant
taxing authority or other authority in accordance with applicable law, and (D)
the Borrower shall deliver to the Administrative Agent evidence of such payment
to the relevant taxing authority or other authority in the manner provided in
Section 3.11(e).
(b) Refunds. If the Borrower pays any additional amount under Section 3.11
-------
(a "Tax Payment") and any Lender or Affiliate thereof effectively obtains a
refund of tax or credit against tax by reason of the Tax Payment (a "Tax
Credit") and such Tax Credit is, in the reasonable judgement of such Lender or
Affiliate, attributable to such Tax Payment, then such Lender, after actual
receipt of such Tax Credit or actual receipt of the benefits thereof, shall
promptly reimburse the Borrower for such amount as such Lender shall reasonably
determine to be the proportion of the Tax Credit as would leave the Borrower
(after that reimbursement) in no better or worse position than it would have
been if the Tax Payment had not been required; provided, that no Lender shall be
--------
required to make any reimbursement if it reasonably believes the making of such
reimbursement would cause it to lose the benefit of the Tax Credit or would
adversely affect in any other respect its tax position. Subject to the other
terms hereof, any claim by a Lender for a Tax Credit shall be made in a manner,
order and amount as such Lender determines in its sole and absolute discretion.
Except to the extent necessary to evaluate any Tax Credit, no Lender shall be
obligated to disclose information regarding its tax affairs or computations to
the Borrower, it being understood and agreed that in no event shall any Lender
be required to disclose information regarding its tax position that it deems to
be confidential (other than with respect to the Tax Credit).
(c) Stamp and Other Taxes. In addition to the Taxes described in Section
---------------------
3.11(a), the Borrower shall pay any present or future stamp, registration,
recordation or documentary taxes or any other similar fees or charges or excise
or property taxes, levies of the United States or any state or political
subdivision thereof or any applicable foreign jurisdiction which arise from any
payment made hereunder or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement, the Loans, the other Loan Documents,
or the perfection of any rights or security interest in respect thereto
(hereinafter referred to as "Other Taxes").
(d) Indemnity. The Borrower shall indemnify each Lender and the
---------
Administrative Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes and Other Taxes imposed by any jurisdiction on
amounts payable under this Section 3.11) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto.
Such indemnification shall be made within thirty (30) days from the date such
Lender or the Administrative Agent (as the case may be) makes written demand
therefor.
(e) Evidence of Payment. Within thirty (30) days after the date of any
-------------------
payment of Taxes or Other Taxes, the Borrower shall furnish to the
Administrative Agent, at its address referred to in Section 12.1, the original
or a certified copy of a receipt evidencing payment thereof or other evidence of
payment satisfactory to the Administrative Agent.
(f) Delivery of Tax Forms. Each Lender organized under the laws of a
---------------------
jurisdiction other than the United States or any state thereof shall deliver to
the Borrower, with a copy to the Administrative Agent, on the Closing Date or
concurrently with the delivery of the relevant Assignment and Acceptance, as
applicable, (i) two United States Internal Revenue Service Forms 4224 or Forms
1001, as applicable (or successor forms) properly completed and certifying in
each case that such Lender is entitled to a complete exemption from withholding
or deduction for or on account of any United States federal income taxes, and
(ii) an Internal Revenue Service Form W-8 or W-9 or successor applicable form,
as the case may be, to establish an exemption from United States backup
withholding taxes. Each such Lender further agrees to deliver to the Borrower,
with a copy to the Administrative Agent, a Form 1001 or 4224 and Form W-8 or W-
9, or successor applicable forms or manner of certification, as the case may be,
on or before the date that any such form expires or becomes obsolete or after
the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower, certifying in the case of a Form
1001 or 4224 that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes (unless in any such case an event (including without limitation any change
in treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders such forms inapplicable or
the exemption to which such forms relate unavailable and such Lender notifies
the Borrower and the Administrative Agent that it is not entitled to receive
payments without deduction or withholding of
United States federal income taxes) and, in the case of a Form W-8 or W-9,
establishing an exemption from United States backup withholding tax.
(g) Survival. Without prejudice to the survival of any other agreement of
--------
the Borrower hereunder, the agreements and obligations of the Borrower contained
in this Section 3.11 shall survive the payment in full of the Obligations and
the termination of the Commitments.
SECTION 3.12 Change of Lending Office; Replacement Lenders. (a) Each
---------------------------------------------
Lender agrees that on the occurrence of any event giving rise to the operation
of Sections 3.8(b), 3.8(c), 3.10, 3.11(a) or 3.11(c) with respect to such
Lender, it will, if requested by the Borrower, use reasonable efforts (subject
to overall policy considerations of such Lender) to designate another Lending
Office for any Loans affected by such event; provided, that such designation is
--------
made on such terms that such Lender and its Lending Office suffer no economic,
legal or regulatory disadvantage, with the object of avoiding the consequence of
the event giving rise to the operation of such Section. Nothing in this Section
3.12(a) shall affect or postpone any of the obligations of any Borrower or the
rights of any Lender provided in Sections 3.8, 3.10 or 3.11.
(b) At any time within one hundred eighty (180) days after any payment by
the Borrower of any amount pursuant to or by reason of the operation of Sections
3.8(b), 3.8(c), 3.10, 3.11(a) or 3.11(c), the Borrower, by writing addressed to
the Administrative Agent and each Lender that requested the payment of such
amount, may nominate or propose an Eligible Assignee that is willing to become
the assignee of the Commitment and other obligations of such Lender (a
"Replacement Lender") pursuant to Section 12.10(b), and within fifteen (15)
Business Days after receipt of such proposal from the Borrower, each such Lender
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance of its entire Commitment in favor of the proposed Replacement Lender
in accordance with Section 12.10(b) unless, prior to the expiration of such
period, the Administrative Agent shall have notified the Borrower and such
Lender that the proposed Replacement Lender is not reasonably acceptable to the
Administrative Agent; provided, that in no event will (i) any Lender be required
--------
to enter into an Assignment and Acceptance at a price less than par plus accrued
interest and prorated fees and other costs due hereunder to the effective date
thereof, (ii) either of the Administrative Agent or Lenders be obligated to
assist the Borrower in identifying any Eligible Assignees that are willing to
become such a Replacement Lender or (iii) any such assignment be required if
consummation conflicts with any Applicable Law. The assignment fee payable to
the Administrative Agent in connection with any such assignment pursuant to
Section 12.10(b) shall be for the account of the Borrower.
SECTION 3.13 Use of Proceeds. The Borrower shall use the proceeds of the
---------------
Loans (a) to repay in full all Debt of the Borrower not otherwise permitted
under this Agreement, (b) to finance the RCN Capital Contribution, (c) to
finance acquisitions by the Borrower permitted by this Agreement and (d) for
Capital Expenditures, working capital and general corporate purposes of the
Borrower.
ARTICLE IV
CLOSING; CONDITIONS OF CLOSING AND BORROWING
--------------------------------------------
SECTION 4.1 Closing. The closing shall take place at the offices of
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Xxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P. at 10:00 a.m. on June 30, 1997, or
at such other place or on such other date as the Administrative Agent and the
Borrower shall mutually agree.
SECTION 4.2 Conditions to Closing and Initial Loans. The obligation of
---------------------------------------
the Lenders to close this Agreement and to make the initial Loans is subject to
the satisfaction of each of the following conditions:
(a) Executed Loan Documents. This Agreement, the Notes and the other Loan
-----------------------
Documents shall have been duly authorized, executed and delivered to the
Administrative Agent by the parties thereto, shall be in full force and effect
and no Default or Event of Default shall exist, and the Borrower shall have
delivered original counterparts thereof to the Administrative Agent.
(b) Closing Certificates; etc.
--------------------------
(i) Officers's Certificate. The Administrative Agent shall
----------------------
have received a certificate from the chief executive officer or chief financial
officer of the Borrower in form and substance satisfactory to the Administrative
Agent, to the effect that all representations and warranties of the Borrower
contained in this Agreement and the other Loan Documents are true, correct and
complete; that the Borrower is not in violation of any of the covenants
contained in this Agreement and the other Loan Documents; that, after giving
effect to the transactions contemplated by this Agreement, no Default or Event
of Default has occurred and is continuing; and that the Borrower has satisfied
each of the closing conditions.
(ii) Certificate of Secretary. The Administrative Agent shall
------------------------
have received a certificate of the secretary or assistant secretary of the
Borrower certifying that attached thereto is a true and complete copy of the
articles of incorporation of the Borrower and all amendments thereto, each
certified as of a recent date by the appropriate Governmental Authority in the
applicable jurisdiction; that attached thereto is a true and complete copy of
the bylaws of the Borrower, each as in effect on the date of such certification;
that attached thereto is a true and complete copy of resolutions duly adopted by
the Board of Directors of the Borrower authorizing the borrowings contemplated
hereunder and the execution, delivery and performance of this Agreement and the
other Loan Documents to which the Borrower is a party; and as to the incumbency
and genuineness of the signature of each officer of the Borrower executing Loan
Documents to which it is a party.
(iii) Certificates of Good Standing. The Administrative Agent
-----------------------------
shall have received long-form certificates as of a recent date of the good
standing of the Borrower under the laws of its jurisdiction of organization and
a certificate of the relevant taxing authorities of such jurisdiction certifying
that such Person has filed required tax returns with respect to any franchise
taxes and owes no delinquent franchise taxes.
(iv) Opinions of Counsel. The Administrative Agent shall have
-------------------
received favorable opinions of counsel to the Borrower addressed to the
Administrative Agent and the
Lenders (A) with respect to the Borrower, the Loan Documents and such other
matters as the Lenders shall request and (B) with respect to FCC and other
regulatory matters, each in form and substance satisfactory to the
Administrative Agent.
(v) Insurance. The Administrative Agent shall have received a
---------
certificate of insurance in form and substance satisfactory to the
Administrative Agent.
(c) Consents; Defaults.
------------------
(i) Governmental and Third Party Approvals. All necessary approvals,
--------------------------------------
authorizations and consents, if any be required, of any Person and of all
Governmental Authorities and courts having jurisdiction with respect to the
transactions contemplated by this Agreement and the other Loan Documents shall
have been obtained.
(ii) No Injunction, Etc. No action, proceeding, investigation,
-------------------
regulation or legislation shall have been instituted, threatened or proposed
before any Governmental Authority to enjoin, restrain, or prohibit, or to obtain
substantial damages in respect of, or which is related to or arises out of this
Agreement or the other Loan Documents or the consummation of the transactions
contemplated hereby or thereby, or which in the Administrative Agent's good
faith determination could reasonably be expected to have a Material Adverse
Effect.
(d) Financial Matters.
-----------------
(i) Financial Statements. The Administrative Agent shall have
--------------------
received the financial statements described in Section 5.1(n).
(ii) Financial Condition Certificate. The Borrower shall have
-------------------------------
delivered to the Administrative Agent a certificate, in form and substance
satisfactory to the Administrative Agent, and certified as accurate by the chief
executive officer, chief financial officer or senior vice president of finance
of the Borrower, that (A) the Borrower and its Designated Subsidiaries, taken as
a whole, are Solvent, (B) the Borrower's payables are current and not past due,
(C) attached thereto is a pro forma balance sheet of the Borrower and its
--- -----
Designated Subsidiaries setting forth on a pro forma basis the financial
--- -----
condition of the Borrower and its Designated Subsidiaries on a Combined basis as
of that date, reflecting a pro forma basis the effect of the transactions
--- -----
contemplated herein, including all fees and expenses in connection therewith,
and evidencing compliance on a pro forma basis with the covenants contained in
--- -----
Article VII hereof, (D) attached thereto are the financial projections
(including without limitation pro forma budgets for Capital Expenditures of the
--- -----
Borrower and its Designated Subsidiaries ) previously delivered to the
Administrative Agent representing the good faith opinions of the Borrower and
senior management thereof as to the projected results contained therein and (E)
attached thereto is a calculation of the Applicable Margin pursuant to Section
3.1(c).
(iii) Payment at Closing; Fee Letters. There shall have been paid
-------------------------------
by the Borrower to the Administrative Agent and the Lenders the fees set
forth or referenced in Section 3.3 and any other accrued and unpaid fees or
commissions due hereunder (including, without limitation, legal fees and
expenses), and to any other Person such amount as may be due thereto in
connection with the transactions contemplated hereby, including all taxes, fees
and other charges in connection with the execution, delivery, recording, filing
and registration of any of the Loan Documents.
(e) Miscellaneous.
-------------
(i) Notices of Borrowing. The Administrative Agent shall have
--------------------
received a Notice of Borrowing from the Borrower in accordance with Section
2.2(a) with respect to any Loans to be made on the Closing Date, and a Notice of
Account Designation specifying the account or accounts to which the proceeds of
any loans made after the Closing Date are to be disbursed.
(ii) Proceedings and Documents. All opinions, certificates and other
-------------------------
instruments and all proceedings in connection with the transactions contemplated
by this Agreement shall be satisfactory in form and substance to the Lenders.
The Lenders shall have received copies of all other instruments and other
evidence as the Administrative Agent may reasonably request, in form and
substance satisfactory to the Lenders, with respect to the transactions
contemplated by this Agreement and the taking of all actions in connection
therewith.
(iii) Due Diligence and Other Documents. The Borrower shall have
---------------------------------
delivered to the Administrative Agent such other documents, certificates
and opinions as the Administrative Agent reasonably requests certified by a
secretary or assistant secretary of the Borrower as a true and correct copy
thereof.
SECTION 4.3 Conditions to All Loans. The obligations of the Lenders
-----------------------
to make any Loan is subject to the satisfaction of the following conditions
precedent on the relevant borrowing date:
(a) Continuation of Representations and Warranties. The
----------------------------------------------
representations and warranties contained in Article V shall be true and correct
on and as of such borrowing date with the same effect as if made on and as of
such date (except where such representation or warranty is specifically made as
of an earlier date in which case it shall remain true and correct as of such
earlier date), provided, that the Borrower may qualify any representation and
--------
warranty made in connection with any Notice of Borrowing given pursuant to
Section 2.7(b).
(b) No Existing Default. No Default or Event of Default shall have
-------------------
occurred and be continuing hereunder on the borrowing date with respect to such
Loan or after giving effect to the Loans to be made on such date, provided, that
--------
this Section 4.3(b) shall not apply with respect to any Loan refunding and
terminating the $15 Million Facility in accordance with Section 2.7(b).
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
----------------------------------------------
SECTION 5.1 Representations and Warranties. To induce the
------------------------------
Administrative Agent to enter into this Agreement and the Lenders to make the
Loans, the Borrower hereby represents and warrants to the Administrative Agent
and Lenders that:
(a) Organization; Power; Qualification. Each of the Borrower and its
----------------------------------
Designated Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation, has the
power and authority to own its properties and to carry on its business as now
being and hereafter proposed to be conducted and is duly qualified and
authorized to do business in each jurisdiction in which the character of its
properties or the nature of its business requires such qualification and
authorization, except where the failure to obtain such qualification and
authorization could not reasonably be expected to have a Material Adverse
Effect. The jurisdictions in which the Borrower and its Designated Subsidiaries
are organized and qualified to do business on the date hereof are described on
Schedule 5.1(a).
---------------
(b) Ownership. Each Designated Subsidiary of the Borrower on the date
---------
hereof is listed on Schedule 5.1(b). The capitalization of the Borrower and
---------------
its Designated Subsidiaries on the date hereof consists of the number of shares,
authorized, issued and outstanding, of such classes and series, with or without
par value, described on Schedule 5.1(b). All outstanding shares have been duly
---------------
authorized and validly issued and are fully paid and nonassessable. The
shareholders of the Designated Subsidiaries and the number of shares owned by
each on the date hereof are described on Schedule 5.1(b). As of the date
---------------
hereof, there are no outstanding stock purchase warrants, subscriptions,
options, securities, instruments or other rights of any type or nature
whatsoever, which are convertible into, exchangeable for or otherwise provide
for or permit the issuance of capital stock of the Borrower or its Designated
Subsidiaries, except as described on Schedule 5.1(b) or granted to employees and
---------------
directors of the Borrower and its Subsidiaries pursuant to duly authorized
employee benefit plans.
(c) Authorization of Agreement, Loan Documents and Borrowing. Each of the
--------------------------------------------------------
Borrower and its Designated Subsidiaries has the right, power and authority and
has taken all necessary corporate and other action to authorize the execution,
delivery and performance of this Agreement and each of the other Loan Documents
to which it is a party in accordance with their respective terms. This
Agreement and each of the other Loan Documents have been duly executed and
delivered by the duly authorized officers of the Borrower and each of its
Designated Subsidiaries party thereto, and each such document constitutes the
legal, valid and binding obligation of the Borrower and its Designated
Subsidiaries party thereto, enforceable in accordance with its terms, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar state or federal laws from time to time in effect which
affect the enforcement of creditors' rights in general and the availability of
equitable remedies.
(d) Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc.
---------------------------------------------------------------------
The execution, delivery and performance by the Borrower and its Designated
Subsidiaries of the Loan Documents to which each such Person is a party, in
accordance with their respective terms, the borrowings hereunder and the
transactions contemplated by this Agreement do not and will not, by the passage
of time, the giving of notice or otherwise, (i) require any Governmental
Approval or violate any Applicable Law relating to the Borrower or any of its
Designated Subsidiaries, (ii) conflict with, result in a breach of or constitute
a default under the articles of incorporation, bylaws or other organizational
documents of the Borrower or any of its Designated Subsidiaries or any
indenture, agreement or other instrument to which such Person is a party or by
which any of its properties may be bound or any Governmental Approval relating
to such Person, or (iii) result in or require the creation or imposition of any
Lien upon or with respect to any property now owned or hereafter acquired by
such Person other than Liens arising under the Loan Documents.
(e) Compliance with Law; Governmental Approvals. Each of the Borrower and
-------------------------------------------
its Designated Subsidiaries (i) has all Governmental Approvals required by any
Applicable Law for it to conduct its business, each of which is in full force
and effect, is final and not subject to review on appeal and is not the subject
of any pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, and (ii) is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable Laws relating to it
or any of its respective properties, except in each case with respect to
subclauses (i) and (ii) where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.
(f) Tax Returns and Payments. Each of the Borrower and its Designated
------------------------
Subsidiaries has duly filed or caused to be filed all federal, state, local and
other tax returns required by Applicable Law to be filed, and has paid, or made
adequate provision for the payment of, all federal, state, local and other
taxes, assessments and governmental charges or levies upon it and its property,
income, profits and assets which are due and payable, except where the failure
to so file or cause to be filed such return or pay such taxes could not
reasonably be expected to have a Material Adverse Effect. No Governmental
Authority has asserted any Lien or other claim against the Borrower or any of
its Designated Subsidiaries with respect to unpaid taxes which has not been
discharged or resolved; provided, that the Borrower or such Designated
--------
Subsidiary may contest such Lien or other claim in good faith so long as
adequate reserves are maintained in accordance with GAAP. The charges, accruals
and reserves on the books of the Borrower and any of its Designated Subsidiaries
in respect of federal, state, local and other taxes for all Fiscal Years and
portions thereof since the organization of the Borrower and any of its
Designated Subsidiaries are in the judgment of the Borrower adequate.
(g) Intellectual Property Matters. Except where the failure to own or
-----------------------------
possess such intellectual property rights could not reasonably be expected to
have a Material Adverse Effect, each of the Borrower and its Designated
Subsidiaries owns or possesses rights to use all franchises, licenses,
copyrights, copyright applications, patents, patent rights or licenses, patent
applications, trademarks, trademark rights, trade names, trade name rights,
copyrights and rights with respect to the foregoing which are required to
conduct its business. Except to the extent any revocation, termination or
infringement could not reasonably be expected to have a Material Adverse Effect,
no event has occurred which permits, or after notice or lapse of time or both
would permit, the revocation or termination of any such rights, and neither the
Borrower nor any of its Designated Subsidiaries is liable to any Person for
infringement under Applicable Law with respect to any such rights as a result of
its business operations.
(h) Environmental Matters. Except for matters that could not reasonably be
---------------------
expected to have a Material Adverse Effect:
(i) The properties and operations of the Borrower and its
Designated Subsidiaries are in compliance, and to the best of their knowledge
have been in compliance, with all applicable Environmental Laws;
(ii) Neither the Borrower nor any of its Designated Subsidiaries has
received any notice of violation, alleged violation, non-compliance, liability
or potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of their properties or the operations
conducted in connection therewith, nor does the Borrower or any of its
Designated Subsidiaries have knowledge or reason to believe that any such notice
will be received or is being threatened;
(iii) Hazardous Materials have not been transported or disposed by
the Borrower and its Designated Subsidiaries in violation of, or in a manner or
to a location which could reasonably be expected to give rise to liability
under, Environmental Laws, nor have any Hazardous Materials been generated,
treated, stored or disposed of at, on or under any of such properties in
violation of, or in a manner that could reasonably be expected to give rise to
liability under, any applicable Environmental Laws;
(iv) No judicial proceedings or governmental or administrative
action is pending, or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any of its Designated Subsidiaries is
named as a party with respect to such properties or operations conducted in
connection therewith, nor are there any consent decrees or other decrees,
consent orders, administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental Law with respect to
such properties or such operations; and
(v) None of the Borrower or its Designated Subsidiaries have
released, or to the best of the Borrower's knowledge, there is no threat of
release by the Borrower or any of its Designated Subsidiaries, of Hazardous
Materials at or from such properties, in violation of or in
amounts or in a manner that could reasonably be expected to give rise to
liability under Environmental Laws.
(i) ERISA.
-----
(i) As of the date hereof, neither the Borrower nor any ERISA
Affiliate maintains or contributes to, or has any obligation under, any Employee
Benefit Plans other than those identified on Schedule 6.1(i);
---------------
(ii) The Borrower and each ERISA Affiliate are in compliance with
all applicable provisions of ERISA and the regulations and published
interpretations thereunder with respect to all Employee Benefit Plans except for
any required amendments for which the remedial amendment period as defined in
Section 401(b) of the Code has not yet expired. Each Employee Benefit Plan that
is intended to be qualified under Section 401(a) of the Code has been determined
by the Internal Revenue Service to be so qualified, and each trust related to
such plan has been determined to be exempt under Section 501(a) of the Code. No
liability has been incurred by the Borrower or any ERISA Affiliate which remains
unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan
or any Multiemployer Plan;
(iii) No Pension Plan has been terminated under Sections 4041(e)
or 4042 of ERISA, nor has any accumulated funding deficiency (as defined in
Section 412 of the Code) been incurred (without regard to any waiver granted
under Section 412 of the Code), nor has any funding waiver from the Internal
Revenue Service been received or requested with respect to any Pension Plan, nor
has the Borrower or any ERISA Affiliate failed to make any contributions or to
pay any amounts due and owing as required by Section 412 of the Code, Section
302 of ERISA or the terms of any Pension Plan prior to the due dates of such
contributions under Section 412 of the Code or Section 302 of ERISA, nor has
there been any event requiring any disclosure under Section 4041(c)(3)(C) or
4063(a) of ERISA with respect to any Pension Plan;
(iv) Neither the Borrower nor any ERISA Affiliate has: (A) engaged
in a nonexempt prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Code, (B) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums and there are no premium payments
which are due and unpaid, (C) failed to make a required contribution or payment
to a Multiemployer Plan, or (D) failed to make a required installment or other
required payment under Section 412 of the Code;
(v) No Termination Event has occurred or is reasonably expected
to occur; and
(vi) No proceeding, claim, lawsuit and/or investigation is existing
or, to the best knowledge of the Borrower after due inquiry, threatened
concerning or involving any (A) employee welfare benefit plan (as defined in
Section 3(1) of ERISA) currently maintained or contributed to by the Borrower or
any ERISA Affiliate, (B) Pension Plan or (C) Multiemployer Plan.
(j) Margin Stock. Neither the Borrower nor any of its Designated
------------
Subsidiaries is engaged principally or as one of its activities in the business
of extending credit for the purpose of "purchasing" or "carrying" any "margin
stock" (as each such term is defined or used in Regulations G and U of the Board
of Governors of the Federal Reserve System). No part of the proceeds of any of
the Loans or Letters of Credit will be used for purchasing or carrying margin
stock or for any purpose which violates, or which would be inconsistent with,
the provisions of Regulation G, T, U or X of such Board of Governors.
(k) Government Regulation. Neither the Borrower nor any of its Designated
---------------------
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company" (as each such term is defined or used in the Investment
Company Act of 1940, as amended) and neither the Borrower nor any of its
Designated Subsidiaries is, or after giving effect to any Loan will be, subject
to regulation under the Public Utility Holding Company Act of 1935 or the
Interstate Commerce Act, each as amended.
(l) Material Contracts. Schedule 5.1(l) sets forth a complete and accurate
------------------ ---------------
list of all Material Contracts of the Borrower and its Designated Subsidiaries
in effect as of the Closing Date not listed on any other Schedule hereto; other
than as set forth in Schedule 5.1(l), each such Material Contract is, as of the
---------------
date hereof, in full force and effect in accordance with the terms thereof. The
Borrower and its Designated Subsidiaries have delivered to the Administrative
Agent a true and complete copy of each Material Contract requested thereby and
required to be listed on Schedule 5.1(l).
---------------
(m) Employee Relations. As of the date hereof, each of the Borrower and
------------------
any of its Designated Subsidiaries has a stable work force in place and is not,
except as set forth on Schedule 5.1(m), party to any collective bargaining
---------------
agreement nor has any labor union been recognized as the representative of its
employees. As of the date hereof, the Borrower knows of no pending, threatened
or contemplated strikes, work stoppage or other collective labor disputes
involving its employees or those of its Designated Subsidiaries.
(n) Financial Statements. The (i) unaudited Combined balance sheet of the
--------------------
Borrower and its Designated Subsidiaries as of December 31, 1996 and March 31,
1997 and the related statements of income and retained earnings and cash flows
for the fiscal periods then ended and (ii) audited consolidated balance sheet of
the Borrower and its Subsidiaries as of December 31, 1996 and related statements
of revenue and retained earnings, copies of which have been furnished to the
Administrative Agent and each Lender, are in all material respects complete and
correct and fairly present the assets, liabilities and financial position of the
Borrower and its Designated Subsidiaries or Subsidiaries, as the case may be, as
at such dates, and the results of the operations and changes of financial
position for the periods then ended. All such financial statements, including
the related schedules and notes thereto, have been prepared in accordance with
GAAP (except that such unaudited statements may not contain notes required by
GAAP). The Borrower and its Designated Subsidiaries, on a Combined basis, have
no Debt, obligation or other unusual forward or long-term commitment which is
not fairly reflected in the foregoing financial statements or in the notes
thereto.
(o) No Material Adverse Change. Since December 31, 1996, there has been no
--------------------------
material adverse change in the properties, business, operations, or financial
condition of the Borrower and its Designated Subsidiaries and no event has
occurred or condition arisen that could reasonably be expected to have a
Material Adverse Effect; provided, that the consummation of the Reorganization
--------
shall not constitute such a material adverse change or Material Adverse Effect.
(p) Solvency. As of the Closing Date and after giving effect to each Loan
--------
made hereunder, the Borrower and its Designated Subsidiaries, taken as a whole,
will be Solvent.
(q) Titles to Properties. Each of the Borrower and its Designated
--------------------
Subsidiaries has such title to the real property owned by it as is necessary or
desirable to the conduct of its business and valid and legal title to all of its
personal property and assets, including, but not limited to, those reflected on
the balance sheets of the Borrower and its Designated Subsidiaries delivered
pursuant to Section 5.1(n), except those which have been disposed of by the
Borrower and its Designated Subsidiaries subsequent to such date which
dispositions have been in the ordinary course of business or as otherwise
expressly permitted hereunder, and except where the failure to obtain such
titles could not reasonably be expected to have a Material Adverse Effect.
(r) Liens. None of the properties and assets of the Borrower or any of its
-----
Designated Subsidiaries is subject to any Lien, except Liens permitted pursuant
to Section 9.2.
(s) Debt and Guaranty Obligations. Schedule 5.1(s) is a complete and
----------------------------- ---------------
correct listing of all Debt of the Borrower and its Designated Subsidiaries in
excess of $1,000,000, as of the date hereof.
(t) Litigation. Except as set forth on Schedule 5.1(t), there are no
---------- ---------------
actions, suits or proceedings pending nor, to the knowledge of the Borrower,
threatened against or in any other way relating adversely to or affecting the
Borrower or any of its Designated Subsidiaries or any of their respective
properties in any court or before any arbitrator of any kind or before or by any
Governmental Authority that could reasonably be expected to have a Material
Adverse Effect.
(u) FCC and PUC Regulatory Matters.
------------------------------
(i) Schedule 5.1(u) hereto sets forth, as of the date hereof, a true
---------------
and complete list of the following information for each FCC License or PUC
Authorization issued to the Borrower or any of its Designated Subsidiaries: (A)
for all FCC Licenses, the name of the licensee, the type of service and the
expiration dates; and (B) for each PUC Authorization, the geographic area
covered by such PUC Authorization, the services that may be provided thereunder
and the expiration date, if any.
(ii) As of the date hereof and except for matters that could not
reasonably be expected to have a Material Adverse Effect, (A) the FCC Licenses
and PUC Authorizations specified on Schedule 5.1(u) hereto are valid and in full
force and effect without conditions except for such conditions as are generally
applicable to holders of such FCC Licenses and PUC Authorizations; (B) no event
has occurred and is continuing which could reasonably be expected to
(1) result in the imposition of a material forfeiture or the revocation,
termination or adverse modification of any such FCC License or PUC Authorization
or (2) materially and adversely affect any rights of the Borrower or any of its
Designated Subsidiaries thereunder; and (C) the Borrower has no reason to
believe and has no knowledge that such FCC Licenses and PUC Authorizations will
not be renewed in the ordinary course.
(iii) All of the material properties, equipment and systems owned,
leased or managed by the Borrower and its Designated Subsidiaries are in good
repair, working order and condition and are and will be in compliance with all
terms and conditions of the FCC Licenses and PUC Authorizations and all
standards or rules imposed by any Governmental Authority or as imposed under any
agreements with telephone companies and customers, except where the failure to
so comply could not reasonably be expected to have a Material Adverse Effect.
(iv) Except where the failure to pay such fees and charges could not
reasonably be expected to have a Material Adverse Effect, the Borrower and each
of its Designated Subsidiaries have paid all franchise, license or other fees
and charges which have become due pursuant to any Governmental Approval in
respect of its business operations and has made appropriate provision as is
required by GAAP for any such fees and charges which have accrued.
(v) Absence of Defaults. No event has occurred or is continuing which
-------------------
constitutes a Default or an Event of Default, or which constitutes, or
which with the passage of time or giving of notice or both would constitute, a
default by the Borrower or any of its Designated Subsidiaries under any Material
Contract or judgment, decree or order (except where such default could not
reasonably be expected to have a Material Adverse Effect) by which the Borrower
or any of its Designated Subsidiaries or any of their respective properties may
be bound; provided, that the representation and warranty in this clause (v)
--------
shall not be incorrect solely on account of any such event relating to a
Material Contract if the Borrower or any of its Designated Subsidiaries is
contesting the claimed default in good faith so long as adequate reserves are
maintained in accordance with GAAP.
(w) Accuracy and Completeness of Information. All written information,
----------------------------------------
reports and other papers and data produced by or on behalf of the Borrower or
any of its Designated Subsidiaries and furnished to the Lenders (other than any
projections) were, at the time the same were so furnished, complete and correct
in all respects to the extent necessary to give the recipient a true and
accurate knowledge of the subject matter. No document furnished or written
statement made to the Administrative Agent or the Lenders by the Borrower or any
of its Designated Subsidiaries in connection with the negotiation, preparation
or execution of this Agreement or any of the Loan Documents contains or will
contain any untrue statement of a fact material to the creditworthiness of the
Borrower or any of its Designated Subsidiaries or omits or will omit to state a
fact necessary in order to make the statements contained therein not misleading.
All projections provided by or on behalf of the Borrower to the Administrative
Agent and Lenders hereunder constitute good faith estimates based on reasonable
assumptions of senior management of the Borrower as of the date delivered. The
Borrower is not aware of any facts which they have not disclosed in writing to
the Administrative Agent having a Material Adverse Effect, or insofar as the
Borrower can now foresee, could reasonably be expected to have a Material
Adverse Effect.
SECTION 5.2 Survival of Representations and Warranties, Etc. All
-----------------------------------------------
representations and warranties set forth in this Article V and all
representations and warranties contained in any certificate, or any of the Loan
Documents (including but not limited to any such representation or warranty made
in or in connection with any amendment thereto) shall constitute representations
and warranties made under this Agreement. All representations and warranties
made under this Agreement shall survive the Closing Date and shall not be waived
by the execution and delivery of this Agreement, any investigation made by or on
behalf of the Lenders or any borrowing hereunder.
ARTICLE VI
FINANCIAL INFORMATION AND NOTICES
---------------------------------
Until all of the principal and interest on the Loans and all fees hereunder
have been paid in full and the Commitments terminated, unless consent has been
obtained in the manner set forth in Section 12.11 hereof, the Borrower will
furnish or cause to be furnished to the Administrative Agent and to the Lenders
at their respective addresses as set forth on Schedule 1.1(a), or such other
---------------
office as may be designated by the Administrative Agent and Lenders from time to
time:
SECTION 6.1 Financial Statements and Projections.
------------------------------------
(a) Quarterly Financial Statements. As soon as practicable and in any
------------------------------
event within forty-five (45) days after the end of each fiscal quarter, an
unaudited Combined and combining balance sheet of the Borrower and its
Designated Subsidiaries as of the close of such fiscal quarter and unaudited
Combined and combining statements of income, retained earnings and cash flows
for the fiscal quarter then ended and that portion of the Fiscal Year then ended
all in reasonable detail setting forth in comparative form the corresponding
figures for the preceding Fiscal Year and prepared by the Borrower in accordance
with GAAP and, if applicable, containing disclosure of the effect on the
financial position or results of operations of any change in the application of
accounting principles and practices during the period, and certified by the
chief financial officer of the Borrower to present fairly in all material
respects the financial condition of the Borrower and its Designated Subsidiaries
as of their respective dates and the results of operations of the Borrower and
its Designated Subsidiaries for the respective periods then ended, subject to
normal year end adjustments.
(b) Annual Financial Statements. As soon as practicable and in any event
---------------------------
within ninety (90) days after the end of each Fiscal Year, an audited Combined
and combining balance sheet of the Borrower and its Designated Subsidiaries as
of the close of such Fiscal Year and audited Combined and combining statements
of income, retained earnings and cash flows for the Fiscal Year then ended,
including the notes thereto, all in reasonable detail setting forth in
comparative form the corresponding figures for the preceding Fiscal Year and
prepared by an independent certified public accounting firm of recognized
national standing in accordance with GAAP and accompanied by a report thereon by
such certified public accountants that is not qualified with respect to scope
limitations imposed by the Borrower or any of its Designated Subsidiaries or
with
respect to accounting principles followed by the Borrower or any of its
Designated Subsidiaries not in accordance with GAAP.
(c) Annual Budget. As soon as practicable and in any event within forty-
-------------
five (45) days after the beginning of each Fiscal Year, a budget of the Borrower
and its Designated Subsidiaries for such Fiscal Year, as approved by the board
of directors of the Borrower and substantially similar in form and scope as the
budget for the 1997 Fiscal Year delivered to the Administrative Agent prior to
closing.
SECTION 6.2 Officer's Compliance Certificate. At each time financial
--------------------------------
statements are delivered pursuant to Sections 6.1 (a) or (b), a certificate of
the chief financial officer or the treasurer of Borrower in the form of Exhibit
-------
E attached hereto (an "Officer's Compliance Certificate").
-
SECTION 6.3 Accountants' Certificate. At each time financial statements are
------------------------
delivered pursuant to Section 6.1(b), a certificate of the independent public
accountants certifying such financial statements addressed to the Administrative
Agent for the benefit of the Lenders:
(a) stating that in making the examination necessary for the certification
of such financial statements, they obtained no knowledge of any Default or Event
of Default or, if such is not the case, specifying such Default or Event of
Default and its nature and period of existence; and
(b) confirming the calculations of the Borrower and its Designated
Subsidiaries required to establish whether or not such Persons are in compliance
with the financial covenants set forth in Article VIII hereof as at the end of
each respective period.
SECTION 6.4 Other Reports.
-------------
(a) Promptly upon receipt thereof, copies of all reports, if any,
submitted to any Borrower or its Board of Directors by its independent public
accountants in connection with their auditing function, including, without
limitation, any management report and any management responses thereto;
(b) As soon as available and in any event within forty-five (45) days
after the end of the Fiscal Year of the Borrower, an updated Schedule 5.1(u)
---------------
accompanied by a report identifying any FCC License or PUC Authorization lost,
surrendered or canceled during such period, and within ten (10) Business Days
after the receipt by the Borrower or any of its Designated Subsidiaries of
notice that any FCC License or PUC Authorization has been lost or canceled,
copies of any such notice accompanied by a report describing the measures
undertaken by either Borrower or any of its Designated Subsidiaries to prevent
such loss or cancellation (and the anticipated impact, if any, that such loss or
cancellation will have upon the business of either Borrower or any of its
Designated Subsidiaries); and
(c) Such other information regarding the operations, business affairs and
financial condition of Borrower or any of its Designated Subsidiaries as the
Administrative Agent, at the request of any Lender, may reasonably request.
SECTION 6.5 Notice of Litigation and Other Matters. Prompt (but in no event
--------------------------------------
later than ten (10) days after an officer of the Borrower obtains knowledge
thereof) telephonic and written notice of:
(a) the commencement of all proceedings and investigations by or before
any Governmental Authority and all actions and proceedings in any court or
before any arbitrator against or involving Borrower or any of its Designated
Subsidiaries or any of their respective properties, assets or businesses which
in such case could reasonably be expected to have a Material Adverse Effect;
(b) any notice of any violation received by the Borrower or any of its
Designated Subsidiaries from any Governmental Authority including, without
limitation, any notice of violation of Environmental Laws which in any such case
could reasonably be expected to have a Material Adverse Effect;
(c) any labor controversy that has resulted in, or threatens to result in,
a strike or other work action against Borrower or any of its Designated
Subsidiaries, where such labor controversy could reasonably be expected to have
a Material Adverse Effect;
(d) any attachment, judgment, lien, levy or order exceeding $250,000 that
may be assessed against or threatened against Borrower or any of its Designated
Subsidiaries;
(e) any Default or Event of Default, or any event which constitutes or
which with the passage of time or giving of notice or both would constitute a
default under any Material Contract unless such default could not reasonably be
expected to have a Material Adverse Effect; provided, that the failure to give
--------
notice with respect to any such event relating to a Material Contract shall not
constitute a Default or Event of Default hereunder if the Borrower or any of its
Designated Subsidiaries is contesting the claimed default in good faith so long
as adequate reserves are maintained in accordance with GAAP; and
(f) (i) any unfavorable determination letter from the Internal Revenue
Service regarding the qualification of an Employee Benefit Plan under Section
401(a) of the Code (along with a copy thereof), (ii) all notices received by any
Borrower or any ERISA Affiliate of the PBGC's intent to terminate any Pension
Plan or to have a trustee appointed to administer any Pension Plan, (iii) all
notices received by any Borrower or any ERISA Affiliate from a Multiemployer
Plan sponsor concerning the imposition or amount of withdrawal liability
pursuant to Section 4202 of ERISA and (iv) the Borrower obtaining knowledge or
reason to know that any Borrower or any ERISA Affiliate has filed or intends to
file a notice of intent to terminate any Pension Plan under a distress
termination within the meaning of Section 4041(c) of ERISA.
SECTION 6.6 Accuracy of Information. All written information, reports,
-----------------------
statements and other papers and data furnished by or on behalf of the Borrower
to the Administrative Agent or any Lender whether pursuant to this Article VI or
any other provision of this Agreement, or any of the Security Documents, shall,
at the time the same is so furnished, comply with Section 5.1(w).
ARTICLE VII
AFFIRMATIVE COVENANTS
---------------------
Until all of the principal and interest on the Loans and all fees hereunder
have been paid in full and the Commitments terminated, unless consent has been
obtained in the manner provided for in Section 12.11, Borrower will, and will
cause each of its Designated Subsidiaries to:
SECTION 7.1 Preservation of Corporate Existence and Related Matters. Except
-------------------------------------------------------
as permitted by Section 9.4, preserve and maintain its separate corporate
existence and all rights, franchises, licenses and privileges necessary to the
conduct of its business, and qualify and remain qualified as a foreign
corporation and authorized to do business in each jurisdiction, except where the
failure to qualify and remain qualified as a foreign corporation could not
reasonably be expected to have a Material Adverse Effect.
SECTION 7.2 Maintenance of Property. Protect and preserve all properties
-----------------------
useful in and material to its business, including copyrights, patents, trade
names and trademarks; maintain in good working order and condition all
buildings, equipment and other tangible real and personal property; and from
time to time make or cause to be made all renewals, replacements and additions
to such property necessary for the conduct of its business, so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times; provided, that the consummation of the Reorganization shall not
--------
constitute a violation of this Section.
SECTION 7.3 Insurance. Maintain insurance with financially sound and
---------
reputable insurance companies against such risks and in such amounts as are
customarily maintained by similar businesses and as may be required by
Applicable Law, and on the Closing Date and from time to time thereafter deliver
to the Administrative Agent upon its request a detailed list of the insurance
then in effect, stating the names of the insurance companies, the amounts and
rates of the insurance, the dates of the expiration thereof and the properties
and risks covered thereby.
SECTION 7.4 Accounting Methods and Financial Records. Maintain a system of
----------------------------------------
accounting, and keep such books, records and accounts (which shall be true and
complete in all material respects) as may be required or as may be necessary to
permit the preparation of financial statements in accordance with GAAP and in
compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.
SECTION 7.5 Payment and Performance of Obligations. Pay and perform all
--------------------------------------
Obligations under this Agreement and the other Loan Documents, and pay or
perform (a) all taxes, assessments and other governmental charges that may be
levied or assessed upon it or any of its property, and
(b) all other indebtedness, obligations and liabilities in accordance with
customary trade practices, except, in each case, when any failure to pay or
perform could not reasonably be expected to have a Material Adverse Effect;
provided, that Borrower or any of its Designated Subsidiaries may contest any
--------
item described in this Section 7.5 in good faith so long as adequate reserves
are maintained with respect thereto in accordance with GAAP.
SECTION 7.6 Compliance With Laws and Approvals. Observe and remain in
----------------------------------
compliance with all Applicable Laws and maintain in full force and effect all
Governmental Approvals, in each case applicable to the conduct of its business,
except where failure to comply with Applicable Laws or maintain Government
Approvals could not reasonably be expected to have a Material Adverse Effect.
SECTION 7.7 Environmental Laws. In addition to and without limiting the
------------------
generality of Section 7.6, (a) comply with, and ensure such compliance by all
tenants and subtenants, if any, with, all applicable Environmental Laws and
obtain and comply with and maintain, and ensure that all tenants and subtenants
obtain and comply with and maintain, any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws, (b) conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws, and promptly comply with all lawful orders and directives of
any Governmental Authority regarding Environmental Laws, except where failure to
so comply, obtain, maintain, conduct or complete such actions under such clauses
(a) and (b) could not reasonably be expected to have a Material Adverse Effect,
and (c) defend, indemnify and hold harmless the Administrative Agent and the
Lenders, and their respective parents, Subsidiaries, Affiliates, employees,
agents, officers and directors, from and against any claims, demands, penalties,
fines, liabilities, settlements, damages, costs and expenses of whatever kind or
nature known or unknown, contingent or otherwise, arising out of, or in any way
relating to the violation of, noncompliance with or liability under any
Environmental Laws applicable to the operations of the Borrower or the
Designated Subsidiaries, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable
attorney's and consultant's fees, investigation and laboratory fees, response
costs, court costs and litigation expenses, except to the extent that any of the
foregoing directly result from the gross negligence or willful misconduct of the
party seeking indemnification therefor.
SECTION 7.8 Compliance with ERISA. In addition to and without limiting the
---------------------
generality of Section 7.6, (a) comply with all applicable material provisions of
ERISA and the regulations and published interpretations thereunder with respect
to all Employee Benefit Plans, (b) not take any action or fail to take action
the result of which could be a liability to the PBGC or to a Multiemployer Plan,
(c) not participate in any prohibited transaction that could result in any
material civil penalty under ERISA or tax under the Code, (d) operate each
Employee Benefit Plan in such a manner that will not incur any material tax
liability under Section 4980B of the Code or any material liability to any
qualified beneficiary as defined in Section 4980B of the Code and (e) furnish to
the Administrative Agent upon the Administrative Agent's request such additional
information about any Employee Benefit Plan as may be reasonably requested by
the Administrative Agent.
SECTION 7.9 Compliance With Agreements. Comply in all respects with each
--------------------------
term, condition and provision of all leases, agreements and other instruments
entered into in the conduct of its business including, without limitation, any
Material Contract, except where failure to so comply could not reasonably be
expected to have a Material Adverse Effect; provided, that no such failure
--------
relating to a Material Contract or other lease, agreement or instrument shall
constitute a Default or Event of Default hereunder if the Borrower or any of its
Designated Subsidiaries is contesting the claimed default in good faith so long
as adequate reserves are maintained in accordance with GAAP.
SECTION 7.10 Conduct of Business. Engage only in businesses in
-------------------
substantially the same fields as the businesses conducted on the Closing Date
and in lines of business directly related thereto.
SECTION 7.11 Visits and Inspections. Permit representatives of the
----------------------
Administrative Agent or any Lender, from time to time and, upon reasonable
notice during normal business hours at its own expense (except that the Borrower
shall pay all such expenses when an Event of Default shall have occurred and be
continuing), to visit and inspect its properties; inspect, audit and make
extracts from its books, records and files, including, but not limited to,
management letters prepared by independent accountants; and discuss with its
principal officers, and its independent accountants, its business, assets,
liabilities, financial condition, results of operations and business prospects.
ARTICLE VIII
FINANCIAL COVENANTS
-------------------
Until all of the principal and interest on the Loans and fees hereunder
have been paid in full and the Commitments terminated, unless consent has been
obtained in the manner set forth in Section 12.11 hereof, Borrower and its
Designated Subsidiaries on a Combined basis will not:
SECTION 8.1 Leverage Ratio. As of the end of each fiscal quarter, permit
--------------
the ratio (the "Leverage Ratio") of (a) Total Debt of Borrower and its
Designated Subsidiaries as of such fiscal quarter end to (b) Operating Cash Flow
of Borrower and its Designated Subsidiaries for the four fiscal quarter period
ending on such fiscal quarter end, to exceed 3.50 to 1.00:
SECTION 8.2 Interest Coverage Ratio. As of the end of each fiscal quarter,
-----------------------
permit the ratio of (a) Operating Cash Flow of Borrower and its Designated
Subsidiaries for the four fiscal quarter period ending on such fiscal quarter
end to (b) Interest Expense of Borrower and its Designated Subsidiaries for the
four fiscal quarter period ending on such fiscal quarter end, to be less than
3.00 to 1.00.
SECTION 8.3 Adjusted Fixed Charge Coverage Ratio. As of the end of each
------------------------------------
fiscal quarter ending on or after the third anniversary of the Closing Date,
permit the ratio of (a) Adjusted Operating Cash Flow for the Borrower and its
Designated Subsidiaries for the four fiscal quarter period ending on such fiscal
quarter end to (b) Fixed Charges of the Borrower and its Designated
Subsidiaries for the four fiscal quarter period ending on such fiscal quarter
end, to be less than 1.05 to 1.00.
SECTION 8.4 Minimum Net Worth. As of the end of any fiscal quarter ending
-----------------
after the date of the Distributions, permit the Net Worth of Commonwealth to be
less than seventy-five percent (75%) of the Net Worth of Commonwealth
immediately after the date of the Distributions, plus, thirty-five percent (35%)
----
of the Net Income of Commonwealth calculated on a cumulative basis for the
period beginning with the first whole fiscal quarter after the date of the
Distributions.
ARTICLE IX
NEGATIVE COVENANTS
------------------
Until all of the principal and interest on the Loans and all fees hereunder
have been paid in full and the Commitments terminated, unless consent has been
obtained in the manner set forth in Section 12.11 hereof, the Borrower will not
and will not permit any of its Designated Subsidiaries to:
SECTION 9.1 Limitations on Debt. Create, incur, assume or suffer to exist
-------------------
any Debt except:
(a) the Obligations;
(b) Debt incurred in connection with a Hedging Agreement (a copy of which
shall be delivered to the Administrative Agent by the Borrower promptly after
execution thereof);
(c) Debt existing on the Closing Date, as set forth on Schedule 5.1(s) in
---------------
the case of Debt in excess of $1,000,000, and any Debt secured by an asset which
asset is transferred to the Borrower as part of the Intergroup Asset Transfers
and the renewal and refinancing (but not the increase above the amount of
principal outstanding with respect to any such Debt at the Closing Date other
than borrowings under lines of credit up to the maximum amount described in
Schedule 5.1(s)) of any of the foregoing;
(d) Debt of the Borrower and its Designated Subsidiaries incurred in
connection with Capital Leases, purchase money Debt of the Borrower and its
Designated Subsidiaries and other Debt in an aggregate amount not to exceed
$20,000,000 on any date of determination (which may be secured to the extent
permitted by Sections 9.2(g) and 9.2(h);
(e) Debt of the Borrower payable solely to any Designated Subsidiary or
Debt of any Designated Subsidiary payable to solely to the Borrower or to
another Designated Subsidiary; and
(f) prior to the assumption thereof by CCSM, Debt under the $15 Million
Facility.
SECTION 9.2 Limitations on Liens. Create, incur, assume or suffer to exist,
--------------------
any Lien on or with respect to any of its assets or properties (including
without limitation shares of capital stock or other ownership interests), real
or personal, whether now owned or hereafter acquired, except:
(a) Liens for taxes, assessments and other governmental charges or levies
(excluding any Lien imposed pursuant to any of the provisions of ERISA or
Environmental Laws) not yet due or as to which the period of grace (not to
exceed thirty (30) days), if any, related thereto has not expired;
(b) the claims of materialmen, mechanics, carriers, warehousemen,
processors or landlords for labor, materials, supplies or rentals incurred in
the ordinary course of business, (i) which are not overdue for a period of more
than thirty (30) days or (ii) which are being contested in good faith and by
appropriate proceedings;
(c) Liens consisting of deposits or pledges made in the ordinary course of
business in connection with, or to secure payment of, obligations under workers'
compensation, unemployment insurance or similar legislation;
(d) Liens constituting encumbrances in the nature of zoning restrictions,
easements and rights or restrictions of record on the use of real property,
which in the aggregate are not substantial in amount and which do not, in any
case, detract from the value of such property or impair the use thereof in the
ordinary conduct of business;
(e) Liens not otherwise permitted by this Section 9.2 and in existence on
the Closing Date and described on Schedule 9.2, any Liens with respect to Debt
------------
permitted by Section 9.1(c) which Liens encumber assets that are transferred to
the Borrower or any of its Designated Subsidiaries as part of the Intergroup
Asset Transfers and any Liens on any refinanced Debt permitted by Section
9.1(c);
(f) (i) Liens evidencing the interest of the Lessor under any Capital
Lease permitted by Section 9.1(d); and (ii) Liens securing purchase money Debt
permitted under Section 9.1(d); provided, that (A) such Liens shall be created
--------
within ninety (90) days after the acquisition of the related asset, (B) such
Liens do not at any time encumber any property other than the property financed
by such Debt, (C) the amount of Debt secured thereby is not increased and (iv)
the principal amount of Debt secured by any such Lien shall at no time exceed
seventy percent (70%) of the original purchase price of such property at the
time it was acquired;
(g) other Liens securing Debt otherwise permitted under Section 9.1, the
principal amount of which outstanding at any one time in the aggregate does not
exceed $500,000; and
(h) prior to the assumption of such Debt by CCSM, Liens securing Debt
under the $15 Million Facility.
SECTION 9.3 Limitations on Loans, Advances, Investments and Acquisitions.
------------------------------------------------------------
Purchase, own, invest in or otherwise acquire, directly or indirectly, any
capital stock, interests in any
partnership or joint venture (including without limitation the creation or
capitalization of any Subsidiaries), evidence of Debt or other obligation or
security, substantially all or a portion of the business or assets of any other
Person or any other investment or interest whatsoever in any other Person, or
make or permit to exist, directly or indirectly, any loans, advances or
extensions of credit to, or any investment in cash or by delivery of property
in, any Person, or enter into, directly or indirectly, any commitment or option
in respect of the foregoing except:
(a) (i) investments existing on the Closing Date in Subsidiaries existing
on the Closing Date, (ii) investments after the Closing Date but prior to the
date of the Distributions in any Designated Subsidiary, (iii) investments after
the date of the Distributions in any Wholly-Owned Subsidiary, (iv) the other
existing loans, advances and investments described on Schedule 9.3 and (v) the
------------
RCN Capital Contribution, the Internal Michigan Cable Distribution, the Chimes
Transfer, the New CLD Transfer, the New CLD Distribution, the Controlled
Northeast Transfer and the Mercom Contribution;
(b) investments in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States of America or any agency thereof
maturing within 120 days from the date of acquisition thereof, (ii) commercial
paper maturing no more than 120 days from the date of creation thereof and at
the time of purchase having the highest rating obtainable from either Standard &
Poor's Ratings Services, a division of The XxXxxx-Xxxx Companies, Inc. or
Xxxxx'x Investors Service, Inc., (iii) certificates of deposit maturing no more
than 120 days from the date of creation thereof issued by commercial banks
incorporated under the laws of the United States of America or any state
thereof, or branches of any foreign bank registered and licensed under the
applicable laws of the United States of America or any state thereof, each
having combined capital, surplus and undivided profits of not less than
$500,000,000 and having a rating of "A" or better by a nationally recognized
rating agency, (iv) time deposits maturing no more than 30 days from the date of
creation thereof with commercial banks or savings banks or savings and loan
associations each having membership either in the FDIC or the deposits of which
are insured by the FDIC and in amounts not exceeding the maximum amounts of
insurance thereunder or (v) money market mutual funds;
(c) investments by the Borrower or any of its Designated Subsidiaries in
the form of acquisitions of all or substantially all of the business or line of
business (whether by the acquisition of capital stock, assets or any combination
of both) of any other Person using the capital stock of the Borrower as
consideration for such acquisition; provided that the Borrower or any of its
--------
Designated Subsidiaries may not use Disqualified Stock as consideration;
(d) investments not otherwise permitted by Section 9.3(c) by the Borrower
or any of its Designated Subsidiaries in the form of acquisitions of all or
substantially all of the business or a line of business (whether by the
acquisition of capital stock, assets or any combination thereof) of any other
Person, in an amount not to exceed $80,000,000 in the aggregate during the term
of this Agreement; and
(e) loans, advances or other investments by the Borrower or any of its
Designated Subsidiaries in any Subsidiaries thereof that are not Wholly-Owned
Subsidiaries and in Persons not
constituting Subsidiaries (after giving effect to any such investment) of the
Borrower or any of its Designated Subsidiaries in an aggregate amount not to
exceed $20,000,000.
SECTION 9.4 Limitations on Mergers and Liquidation. Merge, consolidate or
--------------------------------------
enter into any similar combination with any other Person or liquidate, wind-up
or dissolve itself (or suffer any liquidation or dissolution) except:
(a) any Wholly-Owned Designated Subsidiary of the Borrower may merge with
any other Wholly-Owned Designated Subsidiary of the Borrower;
(b) any Wholly-Owned Designated Subsidiary may merge into the Person such
Wholly-Owned Designated Subsidiary was formed to acquire in connection with an
acquisition permitted by Section 9.3(c);
(c) any Wholly-Owned Designated Subsidiary of the Borrower may wind-up
into the Borrower or any other Wholly-Owned Designated Subsidiary of the
Borrower; and
(d) the Borrower or any of its Wholly-Owned Designated Subsidiaries may
merge or consolidate with any other Person, provided, that, (i) the Borrower or
--------
such Designated Subsidiary is the surviving corporation after such merger or
consolidation and (ii) the Borrower and its Designated Subsidiaries are in pro
forma compliance after such merger or consolidation with all terms and covenants
contained in this Agreement and the other Loan Documents.
SECTION 9.5 Limitations on Sale of Assets. Convey, sell, lease, assign,
-----------------------------
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, the sale of any receivables and leasehold
interests and any sale-leaseback or similar transaction), whether now owned or
hereafter acquired except:
(a) the sale of inventory in the ordinary course of business;
(b) the sale of assets no longer used or usable in the business of the
Borrower or any of its Designated Subsidiaries;
(c) the transfer of assets to the Borrower or any other Wholly-Owned
Designated Subsidiaries pursuant to Section 9.4(c);
(d) the sale or discount of accounts receivable arising in the ordinary
course of business in connection with the compromise or collection thereof;
(e) the sale of assets that for the four fiscal quarters ending
immediately prior to such sale generated less than fifteen percent (15%) of the
Operating Cash Flow of the Borrower and its Designated Subsidiaries for such
four fiscal quarter period; provided, that during the term of the Revolving
--------
Credit Facility, aggregate sales of assets under this subsection may not exceed
twenty-five percent (25%) of Operating Cash Flow accumulated from the Closing
Date to the date of the most recent sale of assets without the written consent
of the Required Lenders; and provided further
----------------
that the Borrower and its Designated Subsidiaries will comply with Section
2.3(c) with respect to the proceeds of any sale under this Section 9.5(e); and
(f) the Allentown Asset Transfers, the Intergroup Asset Transfers, the
Chimes Transfer, the New CLD Transfer, the Controlled Northeast Transfer and the
Mercom Contribution.
SECTION 9.6 Limitations on Exchange and Issuance of Capital Stock.
-----------------------------------------------------
Issue, sell or otherwise dispose of any class or series of capital stock of it
that, by its terms or by the terms of any security into which it is convertible
or exchangeable, is, or upon the happening of an event or passage of time would
be, (a) convertible or exchangeable into Debt or (b) required to be redeemed or
repurchased, including at the option of the holder, in whole or in part, or has,
or upon the happening of an event or passage of time would have, a redemption or
similar payment due (other than in any case by the giving of an optional notice
of redemption by the issuer thereof).
SECTION 9.7 Transactions with Affiliates. Directly or indirectly:
----------------------------
(a) make any loan or advance to, or purchase or assume any note or other
obligation to or from, any of its officers, directors, shareholders or other
Affiliates, or to or from any member of the immediate family of any of its
officers, directors, shareholders or other Affiliates, or subcontract any
operations to any of its Affiliates, or (b) enter into, or be a party to, any
transaction with any of its Affiliates (an "Affiliate Transaction"), except
pursuant to the reasonable requirements of its business and upon fair and
reasonable terms that are no less favorable to it than it would obtain in a
comparable arm's length transaction with a Person not its Affiliate; provided,
--------
that the foregoing provisions of this Section shall not prohibit: (i) agreements
with or for the benefit of employees of the Borrower or any of its Subsidiaries
regarding bridge home loans and other loans necessitated by the relocation of
such employee, or regarding short-term hardship advances or routine advances for
business expenses in the ordinary course of business; (ii) any transaction
solely among the Borrower and its Wholly-Owned Subsidiaries; (iii) the Borrower
making any dividend or distribution permitted by Section 9.6; (iv) any borrowing
or payment of principal or interest on any Debt permitted by Section 9.1; (v)
any Affiliate Transaction pursuant to agreements or other arrangements in effect
on the date hereof or otherwise consistent with past practice (and any renewal,
replacement or modification of any such agreement or arrangement on terms that
are not materially more adverse to the Borrower); (vi) the consummation of the
Reorganization; (vii) any Affiliate Transaction entered into in connection with
the Reorganization and described in the information statement, included in the
related registration statement on SEC Form 10, made available to the
shareholders of C-TEC in connection with the distribution to them of shares of
stock of Cable Systems Holdings or CCSM (and any renewal, replacement or
modification of the terms of any such Affiliate Transaction on terms that are
not materially more adverse to the Borrower); or (viii) any Affiliate
Transaction in which the amount involved does not exceed $100,000; provided
--------
further, that in any Fiscal Year the aggregate amount paid by the Borrower and
-------
its Designated Subsidiaries to other Subsidiaries of the Borrower, to Cable
Systems Holdings, to other Subsidiaries of Cable Systems Holdings, to CCSM and
to Subsidiaries of CCSM for the provision of administrative and management
services of substantially the same nature, scope and timing as those provided
prior to the date of the Distributions shall not exceed six percent (6%) of the
Combined gross revenues of the Borrower and its Subsidiaries for such Fiscal
Year.
SECTION 9.8 Certain Accounting Changes. Change its Fiscal Year end,
--------------------------
or make any change in its accounting practices except as required or permitted
by GAAP and in accordance with Section 12.9.
SECTION 9.9 Restrictive Agreements. Other than the $15 Million
----------------------
Facility, enter into any Debt which contains any negative pledge on assets or
which restricts, limits or otherwise encumbers (a) its ability to incur Liens on
or with respect to any of its assets or properties other than the assets or
properties securing such Debt or (b) the ability of any Designated Subsidiary to
make any payment to the Borrower (in the form of dividends, intercompany
advances or otherwise); provided, that any Debt permitted to be refinanced
--------
pursuant to Section 9.1(c) may, after any such refinancing, include terms that
are not materially more restrictive than the terms in existence on the Closing
Date with respect to such Debt.
ARTICLE X
DEFAULT AND REMEDIES
--------------------
SECTION 10.1 Events of Default. Each of the following shall
-----------------
constitute an Event of Default, whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment or order of any court or any order, rule or regulation
of any Governmental Authority or otherwise:
(a) Default in Payment of Principal of Loans. The Borrower shall default
----------------------------------------
in any payment of principal of any Loan or Note when and as due (whether at
maturity, by reason of acceleration or otherwise).
(b) Other Payment Default. The Borrower shall default in the payment when
---------------------
and as due (whether at maturity, by reason of acceleration or otherwise) of
interest on any Loan or Note or any fees hereunder, and such default shall
continue unremedied for five (5) Business Days.
(c) Misrepresentation. Any representation or warranty made or deemed to be
-----------------
made by the Borrower or any of its Designated Subsidiaries under this Agreement,
any Loan Document or any amendment hereto or thereto, shall at any time prove to
have been incorrect or misleading in any material respect when made or deemed
made.
(d) Default in Performance of Certain Covenants. The Borrower shall
-------------------------------------------
default in the performance or observance of any covenant or agreement contained
in Sections 6.5(e) or Articles VIII or IX (other than Sections 9.8 or 9.9) of
this Agreement.
(e) Default in Performance of Other Covenants and Conditions. Borrower or
--------------------------------------------------------
any of its Designated Subsidiaries shall default in the performance or
observance of any term, covenant, condition or agreement contained in this
Agreement (other than as specifically provided for in this Section 10.1) or any
other Loan Document and such default shall continue for a period of thirty (30)
days after written notice thereof has been given to the Borrower by the
Administrative Agent.
(f) Hedging Agreement. Any termination payment shall be due by the
-----------------
Borrower under any Hedging Agreement and such amount is not paid within five (5)
Business Days of the due date thereof.
(g) Debt Cross-Default. The Borrower or any of its Designated Subsidiaries
------------------
shall (i) default in the payment of any Debt (other than the Notes) the
aggregate outstanding amount of which Debt is in excess of $1,000,000 beyond the
period of grace if any, provided in the instrument or agreement under which such
Debt was created, or (ii) default in the observance or performance of any other
agreement or condition relating to any Debt (other than the Notes) the aggregate
outstanding amount of which Debt is in excess of $1,000,000 or contained in any
instrument or agreement evidencing, securing or relating thereto or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders of such Debt (or a
trustee or agent on behalf of such holder or holders) to cause, with the giving
of notice if required, any such Debt to become due prior to its stated maturity
(any applicable grace period having expired).
(h) Change in Control. (i) (A) PKS shall cease to hold, either directly or
-----------------
indirectly through one or more PKS Entities, (1) C-TEC Shares constituting at
least thirty percent (30%) of the number of the Pro Forma Outstanding C-TEC
Shares or (2) C-TEC Voting Shares constituting at least thirty percent (30%) of
the voting power represented by the Pro Forma Outstanding C-TEC Voting Shares or
(B) any person (other than PKS or a PKS Entity) or group of persons (within the
meaning of Section 13(d) (other than any group comprised principally of PKS and
PKS Entities)) shall have acquired in one or more series of transactions
beneficial ownership (within the meaning of Section 13(d)) of (1) more than
fifty-one percent (51%) of the outstanding C-TEC Shares or (2) C-TEC Voting
Shares constituting more than fifty-one percent (51%) of the voting power
represented by the outstanding C-TEC Voting Shares;
(ii) As used in Sections 10.1(h)(i):
(A) "comprised principally" means, with respect to determining
whether any group of persons (within the meaning of Section 13(d)) is
comprised principally of PKS and PKS Entities, that PKS and PKS Entities
that are members of such group beneficially own (within the meaning of
Section 13(d)) in the aggregate at least 51% of the relevant shares
beneficially owned (within the meaning of Section 13(d)) by all members of
such group (calculated in each case, however, without giving effect to any
provisions of Section 13(d) that attribute to each member of such group
ownership of such shares beneficially owned by other members of such group
on account of having shared voting power);
(B) "C-TEC Shares" means shares of C-TEC Common Stock, par value
$1.00 per share, and shares of C-TEC Class B Common Stock, par value $1.00
per share;
(C) "C-TEC Voting Shares" means any C-TEC Shares and any other
shares of capital stock of C-TEC having ordinary power to vote for the
election of directors of C-TEC.
(D) "PKS" means Xxxxx Xxxxxx Sons' Inc. and its successors;
(E) "PKS Entity" means (i) any corporation of which securities
having ordinary voting power to elect a majority of the board of directors
of such corporation are held of record or through a nominee by PKS or
another PKS Entity (or some combination thereof), (ii) any partnership if
at least a majority of the value of its general partnership interests are
held of record or through a nominee by PKS or another PKS Entity (or some
combination thereof) and (iii) any limited liability or similar company if
securities or other equity interests having ordinary voting power to elect
or appoint a majority of the managing members of such company are held of
record or through a nominee by PKS or another PKS Entity (or some
combination thereof);
(F) "Pro Forma Outstanding" means as of any date of determination
with reference to C-TEC Shares and C-TEC Voting Shares, (a) the number of
such Shares outstanding on such date less (b) the number of Shares issued
after the date hereof (i) for cash, (ii) in consideration for the
acquisition of any investment (including by way of merger) or property or
the provision of services, (iii) upon the exercise of any warrant, option,
convertible security or similar instrument issued after the date hereof for
any consideration described in the foregoing clauses (i) and (ii) or (iv)
in connection with the establishment or operation of any employee stock
option plan or similar employee benefit arrangement hereafter adopted by C-
TEC or any of its Wholly-Owned Subsidiaries; and
(G) "Section 13(d)" means Section 13(d) of the Securities Exchange
Act of 1934, as amended, and the rules and regulations relating to such
section promulgated by the Securities and Exchange Commission.
(i) Voluntary Bankruptcy Proceeding. The Borrower or any of its
-------------------------------
Designated Subsidiaries shall (i) commence a voluntary case under the federal
bankruptcy laws (as now or hereafter in effect), (ii) file a petition seeking to
take advantage of any other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or composition for adjustment of debts,
(iii) consent to or fail to contest in a timely and appropriate manner any
petition filed against it in an involuntary case under such bankruptcy laws or
other laws, (iv) apply for or consent to, or fail to contest in a timely and
appropriate manner, the appointment of, or the taking of possession by, a
receiver, custodian, trustee, or liquidator of itself or of a substantial part
of its property, domestic or foreign, (v) admit in writing its inability to pay
its debts as they become due, (vi) make a general assignment for the benefit of
creditors, or (vii) take any corporate action for the purpose of authorizing any
of the foregoing.
(j) Involuntary Bankruptcy Proceeding. A case or other proceeding
---------------------------------
shall be commenced against the Borrower or any of its Designated
Subsidiaries in any court of competent jurisdiction seeking (i) relief
under the federal bankruptcy laws (as now or hereafter in effect) or under
any other laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or adjustment of debts, or (ii) the appointment
of a trustee, receiver, custodian, liquidator or the like for the Borrower
or any of its Designated Subsidiaries or for all or any substantial part of
their respective assets, domestic or foreign, and such case or proceeding
shall continue undismissed or unstayed for a period of sixty (60)
consecutive days, or an order granting the relief requested in such case or
proceeding (including, but not limited to, an order for relief under such
federal bankruptcy laws) shall be entered.
(k) Failure of Agreements. Any provision of this Agreement or of
---------------------
any other Loan Document with respect to any material (in the reasonable
judgement thereof) rights and remedies of the Administrative Agent and
Lenders hereunder or thereunder shall for any reason cease to be valid and
binding on the Borrower or any of its Designated Subsidiaries party thereto
or any such Person shall so state in writing.
(l) Termination Event. The occurrence of any of the following
-----------------
events: (i) any Borrower or any ERISA Affiliate fails to make full payment
when due of all amounts which, under the provisions of any Pension Plan or
Section 412 of the Code, the Borrower or any ERISA Affiliate is required to
pay as contributions thereto, (ii) an accumulated funding deficiency in
excess of $1,000,000 occurs or exists, whether or not waived, with respect
to any Pension Plan, (iii) a Termination Event or (iv) any Borrower or any
ERISA Affiliate as employers under one or more Multiemployer Plan makes a
complete or partial withdrawal from any such Multiemployer Plan and the
plan sponsor of such Multiemployer Plans notifies such withdrawing employer
that such employer has incurred a withdrawal liability requiring payments
in an amount exceeding $1,000,000.
(m) Judgment. A judgment or order for the payment of money which
--------
causes the aggregate amount of all such judgments to exceed $500,000 in any
Fiscal Year shall be entered against the Borrower or any of its Designated
Subsidiaries by any court and such judgment or order shall continue
undischarged or unstayed for a period of thirty (30) days.
(n) Related Financings. Either the Cable Systems Credit Facility
------------------
or the CCSM Credit Facility does not close within sixty (60) days of the
Closing Date.
SECTION 10.2 Remedies. Upon the occurrence of an Event of Default,
--------
with the consent of the Required Lenders, the Administrative Agent may, or
upon the request of the Required Lenders, the Administrative Agent shall,
by notice to the Borrower:
(a) Acceleration; Termination of Facilities. Declare the
---------------------------------------
principal of and interest on the Loans and the Notes at the time
outstanding, and all other amounts owed to the Lenders and to the
Administrative Agent under this Agreement or any of the other Loan
Documents and all other Obligations, to be forthwith due and payable,
whereupon the same shall immediately become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in this Agreement or the other Loan Documents to
the contrary notwithstanding, and terminate the Revolving Credit Facility
and any right of the Borrower to request borrowings thereunder; provided,
--------
that upon the occurrence of an Event of Default specified in Section
10.1(i) or (j), the Revolving Credit Facility shall be automatically
terminated and all Obligations shall automatically become due and payable.
(b) Rights of Collection. Exercise on behalf of the Lenders all
--------------------
of its other rights and remedies under this Agreement, the other Loan
Documents and Applicable Law, in order to satisfy all of the Borrower's
Obligations.
SECTION 10.3 Rights and Remedies Cumulative; Non-Waiver; etc. The
-----------------------------------------------
enumeration of the rights and remedies of the Administrative Agent and the
Lenders set forth in this Agreement is not intended to be exhaustive and
the exercise by the Administrative Agent and the Lenders of any right or
remedy shall not preclude the exercise of any other rights or remedies, all
of which shall be cumulative, and shall be in addition to any other right
or remedy given hereunder or under the Loan Documents or that may now or
hereafter exist in law or in equity or by suit or otherwise. No delay or
failure to take action on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or privilege preclude other or further exercise thereof or the
exercise of any other right, power or privilege or shall be construed to be
a waiver of any Event of Default. No course of dealing between the
Borrower, the Administrative Agent and the Lenders or their respective
agents or employees shall be effective to change, modify or discharge any
provision of this Agreement or any of the other Loan Documents or to
constitute a waiver of any Event of Default.
ARTICLE XII
THE ADMINISTRATIVE AGENT
------------------------
SECTION 11.1 Appointment. Each of the Lenders hereby irrevocably
-----------
designates and appoints First Union as Administrative Agent of such Lender
under this Agreement and the other Loan Documents and each such Lender
irrevocably authorizes First Union as Administrative Agent for such Lender,
to take such action on its behalf under the provisions of this Agreement
and the other Loan Documents and to exercise such powers and perform such
duties as are expressly delegated to the Administrative Agent by the terms
of this Agreement and such other Loan Documents, together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision
to the contrary elsewhere in this Agreement or such other Loan Documents,
the Administrative Agent shall not have any duties or responsibilities,
except those expressly set forth herein and therein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into
this Agreement or the other Loan Documents or otherwise exist against the
Administrative Agent.
SECTION 11.2 Delegation of Duties. The Administrative Agent may
--------------------
execute any of its respective duties under this Agreement and the other
Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by the Administrative Agent with reasonable care.
SECTION 11.3 Exculpatory Provisions. Neither the Administrative Agent nor
----------------------
any of its officers, directors, employees, agents, attorneys-in-fact,
Subsidiaries or Affiliates shall be (a) liable for any action lawfully taken or
omitted to be taken by it or such Person under or in connection with this
Agreement or the other Loan Documents (except for actions occasioned solely by
its or such Person's own gross negligence or willful misconduct), or (b)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or any of its Designated
Subsidiaries or any officer thereof contained in this Agreement or the other
Loan Documents or in any certificate, report, statement or other document
referred to or provided for in, or received by the Administrative Agent under or
in connection with, this Agreement or the other Loan Documents or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or the other Loan Documents or for any failure of the Borrower or any
of its Designated Subsidiaries to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement, or to inspect the
properties, books or records of the Borrower or any of its Designated
Subsidiaries.
SECTION 11.4 Reliance by the Administrative Agent. The Administrative Agent
------------------------------------
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon advice
and statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent may deem and treat the payee of
any Note as the owner thereof for all purposes unless such Note shall have been
transferred in accordance with Section 12.10 hereof. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement and the other Loan Documents unless it shall first receive such advice
or concurrence of the Required Lenders (or, when expressly required hereby or by
the relevant other Loan Document, all the Lenders) as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action except for its own gross negligence or
willful misconduct. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
Notes in accordance with a request of the Required Lenders (or, when expressly
required hereby, all the Lenders), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Notes.
SECTION 11.5 Notice of Default. The Administrative Agent shall not be deemed
-----------------
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless it has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default". In the event that
Administrative Agent receives such a notice, it shall promptly give notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders; provided that unless and until the Administrative Agent
--------
shall have received such directions, the Administrative Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Lenders.
SECTION 11.6 Non-Reliance on the Administrative Agent and Other Lenders.
----------------------------------------------------------
Each Lender expressly acknowledges that neither the Administrative Agent nor any
of its respective officers, directors, employees, agents, attorneys-in-fact,
Subsidiaries or Affiliates has made any representations or warranties to it and
that no act by the Administrative Agent hereinafter taken, including any review
of the affairs of the Borrower or any of its Designated Subsidiaries, shall be
deemed to constitute any representation or warranty by the Administrative Agent
to any Lender. Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Borrower and its Designated Subsidiaries and made its own decision to make its
Loans hereunder and enter into this Agreement. Each Lender also represents that
it will, independently and without reliance upon the Administrative Agent or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Loan Documents, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other condition
and creditworthiness of the Borrower and its Designated Subsidiaries. Except
for notices, reports and other documents expressly required to be furnished to
the Lenders by the Administrative Agent hereunder or by the other Loan
Documents, the Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
operations, property, financial and other condition or creditworthiness of the
Borrower or any of its Designated Subsidiaries which may come into the
possession of the Administrative Agent or any of its respective officers,
directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates.
SECTION 11.7 Indemnification. The Lenders agree to indemnify the
---------------
Administrative Agent in its capacity as such and (to the extent not reimbursed
by the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to the respective amounts of their Commitment Percentages,
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind whatsoever which may at any time (including, without limitation, at any
time following the payment of the Notes or any Reimbursement Obligation) be
imposed on, incurred by or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement or the other Loan Documents, or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided
--------
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the Administrative
Agent's
bad faith, gross negligence or willful misconduct. The agreements in this
Section 11.7 shall survive the payment of the Notes, any Reimbursement
Obligation and all other amounts payable hereunder and the termination of this
Agreement.
SECTION 11.8 The Administrative Agent in Its Individual Capacity. The
---------------------------------------------------
Administrative Agent and its respective Subsidiaries and Affiliates may make
loans to, accept deposits from and generally engage in any kind of business with
the Borrower as though the Administrative Agent were not an Administrative Agent
hereunder. With respect to any Loans made or renewed by it and any Note issued
to it and with respect to any issued by it or participated in by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any Lender and may exercise the same as though
it were not an Administrative Agent, and the terms "Lender" and "Lenders" shall
include the Administrative Agent in its individual capacity.
SECTION 11.9 Resignation of the Administrative Agent; Successor
--------------------------------------------------
Administrative Agent. Subject to the appointment and acceptance of a successor
--------------------
as provided below, the Administrative Agent may resign at any time by giving
notice thereof to the Lenders and the Borrower. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Administrative
Agent, which successor shall have minimum capital and surplus of at least
$500,000,000. If no successor Administrative Agent shall have been so appointed
by the Required Lenders and shall have accepted such appointment within thirty
(30) days after the Administrative Agent's giving of notice of resignation, then
the Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which successor shall have minimum capital and surplus of
at least $500,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Section 12.9 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Administrative Agent.
ARTICLE XII
MISCELLANEOUS
-------------
SECTION 12.1 Notices.
-------
(a) Method of Communication. Except as otherwise provided in this Agreement,
-----------------------
all notices and communications hereunder shall be in writing, or by telephone
subsequently confirmed in writing. Any notice shall be effective if delivered by
hand delivery or sent via telecopy, recognized overnight courier service or
certified mail, return receipt requested, and shall be presumed to be received
by a party hereto (i) on the date of delivery if delivered by hand or sent by
telecopy, (ii) on the next Business Day if sent by recognized overnight courier
service and (iii) on
the third Business Day following the date sent by certified mail, return
receipt requested. A telephonic notice to the Administrative Agent as
understood by the Administrative Agent will be deemed to be the controlling
and proper notice in the event of a discrepancy with or failure to receive
a confirming written notice.
(b) Addresses for Notices. Notices to any party shall be sent to
---------------------
it at the following addresses, or any other address as to which all the
other parties are notified in writing.
If to the Borrower: C-TEC Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxx Xxxxxxxx
Telephone No.: 000-000-0000
Telecopy No.: 000-000-0000
With copies to: Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx, Esq.
Telephone No.: 000-000-0000
Telecopy No.: 000-000-0000
If to First Union as First Union National Bank
Administrative Agent: Xxx Xxxxx Xxxxx Xxxxxx, XX-00
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Syndication Agency Services
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
If to any Lender: To the Address set forth on Schedule 1.1(a)
---------------
hereto
(c) Administrative Agent's Office. The Administrative Agent
-----------------------------
hereby designates its office located at the address set forth above, or any
subsequent office which shall have been specified for such purpose by
written notice to the Borrower and Lenders, as the Administrative Agent's
Office referred to herein, to which payments due are to be made and at
which Loans will be disbursed.
SECTION 12.2 Expenses; Indemnity. The Borrower will (a) pay all
-------------------
reasonable out-of-pocket expenses of the Administrative Agent in connection
with: (i) the preparation, execution and delivery of this Agreement and
each other Loan Document, whenever the same shall be executed and
delivered, including without limitation all out-of-pocket syndication and
due diligence expenses and reasonable fees and disbursements of counsel
(not to exceed $60,000) for the Administrative Agent and (ii) the
preparation, execution and delivery of any waiver,
amendment or consent by the Administrative Agent or the Lenders relating to this
Agreement or any other Loan Document, including without limitation reasonable
fees and disbursements of counsel for the Administrative Agent, (b) at any time
when a Default has occurred and is continuing (or at any time thereafter with
respect to any of the following undertaken during the existence of a Default),
pay all reasonable out-of-pocket expenses of the Administrative Agent (and of
the Lenders, but only if such Default is an Event of Default) in connection with
the enforcement of any rights and remedies of the Administrative Agent and
Lenders under the Revolving Credit Facility, including consulting with
appraisers, accountants, engineers, attorneys and other Persons concerning the
nature, scope or value of any right or remedy of the Administrative Agent or any
Lender hereunder or under any other Loan Document or any factual matters in
connection therewith, which expenses shall include without limitation the
reasonable fees and disbursements of such Persons, and (c) defend, indemnify and
hold harmless the Administrative Agent and the Lenders, and their respective
parents, Subsidiaries, Affiliates, employees, agents, officers and directors,
from and against any losses, penalties, fines, liabilities, settlements,
damages, costs and expenses, suffered by any such Person in connection with any
claim, investigation, litigation or other proceeding (whether or not the
Administrative Agent or any Lender is a party thereto) and the prosecution and
defense thereof, arising out of or in any way connected with the Agreement, any
other Loan Document or the Loans, including without limitation reasonable
attorney's and consultant's fees, except to the extent that any of the foregoing
directly result from the gross negligence or willful misconduct of the party
seeking indemnification therefor.
SECTION 12.3 Set-off. In addition to any rights now or hereafter granted
-------
under Applicable Law and not by way of limitation of any such rights, upon and
after the occurrence of any Event of Default and during the continuance thereof,
the Lenders and any assignee or participant of a Lender in accordance with
Section 12.10 are hereby authorized by the Borrower at any time or from time to
time, without notice to the Borrower or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and to apply any
and all deposits (general or special, time or demand, including, but not limited
to, indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other indebtedness at any time held or owing by the Lenders,
or any such assignee or participant to or for the credit or the account of the
Borrower against and on account of the Obligations irrespective of whether or
not (a) the Lenders shall have made any demand under this Agreement or any of
the other Loan Documents or (b) the Administrative Agent shall have declared any
or all of the Obligations to be due and payable as permitted by Section 10.2 and
although such Obligations shall be contingent or unmatured.
SECTION 12.4 Governing Law. This Agreement, the Notes and the other Loan
-------------
Documents, unless otherwise expressly set forth therein, shall be governed by,
construed and enforced in accordance with the laws of the State of North
Carolina, without reference to the conflicts or choice of law principles
thereof.
SECTION 12.5 Consent to Jurisdiction. The Borrower hereby irrevocably
-----------------------
consents to the personal jurisdiction of the state and federal courts located in
Mecklenburg County, North Carolina, in any action, claim or other proceeding
arising out of any dispute in connection with this Agreement, the Notes and the
other Loan Documents, any rights or obligations hereunder or thereunder, or the
performance of such rights and obligations. The Borrower hereby irrevocably
consent to the service of a summons and complaint and other process in any
action, claim or proceeding brought by the Administrative Agent or any Lender in
connection with this Agreement, the Notes or the other Loan Documents, any
rights or obligations hereunder or thereunder, or the performance of such rights
and obligations, on behalf of itself or its property, in the manner specified in
Section 12.1. Nothing in this Section 12.5 shall affect the right of the
Administrative Agent or any Lender to serve legal process in any other manner
permitted by Applicable Law or affect the right of the Administrative Agent or
any Lender to bring any action or proceeding against the Borrower or its
properties in the courts of any other jurisdictions.
SECTION 12.6 Binding Arbitration; Waiver of Jury Trial.
-----------------------------------------
(a) Binding Arbitration. Upon demand of any party, whether made before or
-------------------
after institution of any judicial proceeding, any dispute, claim or controversy
arising out of, connected with or relating to the Notes or any other Loan
Documents ("Disputes"), between or among parties to the Notes or any other Loan
Document shall be resolved by binding arbitration as provided herein.
Institution of a judicial proceeding by a party does not waive the right of that
party to demand arbitration hereunder. Disputes may include, without
limitation, tort claims, counterclaims, claims brought as class actions, claims
arising from Loan Documents executed in the future, or claims concerning any
aspect of the past, present or future relationships arising out of or connected
with the Loan Documents. Arbitration shall be conducted under and governed by
the Commercial Financial Disputes Arbitration Rules (the "Arbitration Rules") of
the American Arbitration Association and Title 9 of the U.S. Code. All
arbitration hearings shall be conducted in Charlotte, North Carolina. The
expedited procedures set forth in Rule 51, et seq. of the Arbitration Rules
-- ----
shall be applicable to claims of less than $500,000. All applicable statutes of
limitation shall apply to any Dispute. A judgment upon the award may be entered
in any court having jurisdiction. The panel from which all arbitrators are
selected shall be comprised of licensed attorneys. The single arbitrator
selected for expedited procedure shall be a retired judge from the highest court
of general jurisdiction, state or federal, of the state where the hearing will
be conducted. Notwithstanding the foregoing, this paragraph shall not apply to
any Hedging Agreement that is a Loan Document.
(b) Jury Trial. TO THE EXTENT PERMITTED BY LAW, THE ADMINISTRATIVE AGENT,
----------
EACH LENDER AND THE BORROWER HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO
A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT
OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS.
(c) Preservation of Certain Remedies. Notwithstanding the preceding
--------------------------------
binding arbitration provisions, the parties hereto and the other Loan Documents
preserve, without diminution, certain remedies that such Persons may employ or
exercise freely, either alone, in conjunction with or during a Dispute. Each
such Person shall have and hereby reserves the right to proceed in any court of
proper jurisdiction or by self help to exercise or prosecute the following
remedies: (i) all rights to foreclose against any real or personal property or
other security by
exercising a power of sale granted in the Loan Documents or under applicable law
or by judicial foreclosure and sale, (ii) all rights of self help including
peaceful occupation of property and collection of rents, set off, and peaceful
possession of property, (iii) obtaining provisional or ancillary remedies
including injunctive relief, sequestration, garnishment, attachment, appointment
of receiver and in filing an involuntary bankruptcy proceeding, and (iv) when
applicable, a judgment by confession of judgment. Preservation of these remedies
does not limit the power of an arbitrator to grant similar remedies that may be
requested by a party in a Dispute.
SECTION 12.7 Reversal of Payments. To the extent the Borrower makes a
--------------------
payment or payments to the Administrative Agent for the ratable benefit of the
Lenders or the Administrative Agent receives any payment or proceeds of the
collateral which payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds repaid, the Obligations or part thereof
intended to be satisfied shall be revived and continued in full force and effect
as if such payment or proceeds had not been received by the Administrative
Agent.
SECTION 12.8 Injunctive Relief; Punitive Damages.
-----------------------------------
(a) The Borrower recognizes that, in the event the Borrower fails to
perform, observe or discharge any of its obligations or liabilities under this
Agreement, any remedy of law may prove to be inadequate relief to the Lenders.
Therefore, the Borrower agrees that the Lenders, at the Lenders' option, shall
be entitled to temporary and permanent injunctive relief in any such case
without the necessity of proving actual damages.
(b) The Administrative Agent, Lenders and Borrower hereby agree that no
such Person shall have a remedy of punitive or exemplary damages against any
other party to a Loan Document and each such Person hereby waives any right or
claim to punitive or exemplary damages that they may now have or may arise in
the future in connection with any Dispute, whether such Dispute is resolved
through arbitration or judicially.
SECTION 12.9 Accounting Matters. All financial and accounting
------------------
calculations, measurements and computations made for any purpose relating to
this Agreement, including, without limitation, all computations utilized by the
Borrower or any its Designated Subsidiaries to determine compliance with any
covenant contained herein, shall, except as otherwise expressly contemplated
hereby or unless there is an express written direction by the Administrative
Agent to the contrary agreed to by the Borrower, be performed in accordance with
GAAP as in effect from time to time.
SECTION 12.10 Successors and Assigns; Participations.
--------------------------------------
(a) Benefit of Agreement. This Agreement shall be binding upon and inure
--------------------
to the benefit of the Borrower, the Administrative Agent and the Lenders, all
future holders of the Notes, and their respective successors and assigns, except
that the Borrower shall not assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of each Lender.
(b) Assignment by Lenders. Each Lender may, with the consent of the
---------------------
Administrative Agent and Borrower, which consents shall not be unreasonably
withheld (and which consent of the Borrower shall not be required during the
continuance of an Event of Default), assign to one or more Eligible Assignees
all or a portion of its interests, rights and obligations under this Agreement
(including, without limitation, all or a portion of the Loans at the time owing
to it and the Notes held by it); provided that:
--------
(i) each such assignment shall be of a constant, and not a
varying, percentage of all the assigning Lender's rights and obligations under
this Agreement;
(ii) if less than all of the assigning Lender's Commitment is to
be assigned, the Commitment so assigned shall not be less than $5,000,000;
(iii) the parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance in the form of Exhibit F attached hereto
---------
(an "Assignment and Acceptance"), together with any Note or Notes subject to
such assignment;
(iv) such assignment shall not, without the consent of the
Borrower, require the Borrower to file a registration statement with the
Securities and Exchange Commission or apply to or qualify the Loans or the Notes
under the blue sky laws of any state; and
(v) the assigning Lender shall pay to the Administrative Agent an
assignment fee of $3,000 upon the execution by such Lender of the Assignment and
Acceptance; provided that no such fee shall be payable upon any assignment by a
--------
Lender to an Affiliate thereof.
Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be at least five (5) Business Days after the execution thereof, (A) the
assignee thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereby
and (B) the Lender thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement.
(c) Rights and Duties Upon Assignment. By executing and delivering an
---------------------------------
Assignment and Acceptance, the assigning Lender thereunder and the assignee
thereunder confirm to and agree with each other and the other parties hereto as
set forth in such Assignment and Acceptance.
(d) Register. The Administrative Agent shall maintain a copy of each
--------
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders and the amount of the Loans with respect
to each Lender from time to time (the "Register"). The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders may treat each person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or
Lender at any reasonable time and from time to time upon reasonable prior
notice.
(e) Issuance of New Notes. Upon its receipt of an Assignment and
---------------------
Acceptance executed by an assigning Lender and an Eligible Assignee together
with any Note or Notes subject to such assignment and the written consent to
such assignment, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is substantially in the form of Exhibit F:
---------
(i) accept such Assignment and Acceptance;
(ii) record the information contained therein in the Register;
(iii) give prompt notice thereof to the Lenders and the
Borrower; and
(iv) promptly deliver a copy of such Assignment and Acceptance
to the Borrower.
Within five (5) Business Days after receipt of notice, the Borrower shall
execute and deliver to the Administrative Agent, in exchange for the surrendered
Note or Notes, a new Note or Notes to the order of such Eligible Assignee in
amounts equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and a new Note or Notes to the order of the assigning Lender in an
amount equal to the Commitment retained by it hereunder. Such new Note or Notes
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note or Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be in substantially the form
of the assigned Notes delivered to the assigning Lender. Each surrendered Note
or Notes shall be canceled and returned to the Borrower.
(f) Participations. Each Lender may sell participations to one or more
--------------
banks or other entities in all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its Loans and
the Notes held by it); provided that:
--------
(i) such Lender's obligations under this Agreement (including,
without limitation, its Commitment) shall remain unchanged;
(ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations;
(iii) such Lender shall remain the holder of the Notes held by
it for all purposes of this Agreement;
(iv) the Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement;
(v) such Lender shall not permit such participant the right to
approve any waivers, amendments or other modifications to this Agreement or any
other Loan Document other than waivers, amendments or modifications which would
reduce the principal of or the interest rate on any Loan or Reimbursement
Obligation, extend the term or increase the amount of the Commitment, reduce the
amount of any fees to which such participant is entitled, extend any scheduled
payment date for principal of any Loan or, except as expressly contemplated
hereby or thereby, release substantially all of the Collateral; and
(vi) any such disposition shall not, without the consent of the
Borrower, require the Borrower to file a registration statement with the
Securities and Exchange Commission to apply to qualify the Loans or the Notes
under the blue sky law of any state.
(g) Disclosure of Information; Confidentiality. The Administrative Agent
------------------------------------------
and the Lenders shall hold all non-public information with respect to the
Borrower obtained pursuant to the Loan Documents on a need-to-know basis for
making and administering the credit basis in accordance with their customary
procedures for handling confidential information; provided, that the
--------
Administrative Agent may disclose information relating to this Agreement to Gold
----
Sheets and other similar bank trade publications, such information to consist of
------
deal terms and other information customarily found in such publications. Any
Lender may, in connection with any assignment, proposed assignment,
participation or proposed participation pursuant to this Section 13.10, disclose
to the assignee, participant, proposed assignee or proposed participant, any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; provided, that prior to any such disclosure, each such assignee,
--------
proposed assignee, participant or proposed participant shall agree with the
Borrower or such Lender to preserve the confidentiality of any confidential
information relating to the Borrower received from such Lender.
(h) Certain Pledges or Assignments. Nothing herein shall prohibit any
------------------------------
Lender from pledging or assigning any Note to any Federal Reserve Bank in
accordance with Applicable Law.
SECTION 12.11 Amendments, Waivers and Consents. Except as set forth
--------------------------------
below, any term, covenant, agreement or condition of this Agreement or any of
the other Loan Documents may be amended or waived by the Lenders, and any
consent given by the Lenders, if, but only if, such amendment, waiver or consent
is in writing signed by the Required Lenders (or by the Administrative Agent
with the consent of the Required Lenders) and delivered to the Administrative
Agent and, in the case of an amendment, signed by the Borrower; provided, that
--------
no amendment, waiver or consent shall (a) increase the amount or extend the time
of the obligation of the Lenders to make Loans (including without limitation
pursuant to Section 2.6), (b) extend the originally scheduled time or times of
payment of the principal of any Loan or the time or times of payment of interest
on any Loan, (c) reduce the rate of interest or fees payable on any Loan, (d)
permit any subordination of the principal or interest on any Loan, (e) release
any Security Document (other than as specifically permitted in this Agreement or
the applicable Security Document), (f) amend the provisions of this Section
12.11 or the definition of Required Lenders, (g) amend the provisions of Section
4.4 providing that all payments to the Lenders shall be pro rata in accordance
--- ----
with their respective Commitment Percentages or (h) amend the several nature of
the obligations of the Lenders under this Agreement, without the prior written
consent of each Lender. In addition, no amendment, waiver or consent to the
provisions of Article XI shall be made without the written consent of the
Administrative Agent.
SECTION 12.12 Performance of Duties. The Borrower's obligations under
---------------------
this Agreement and each of the Loan Documents shall be performed by the Borrower
at its sole cost and expense.
SECTION 12.13 All Powers Coupled with Interest. All powers of
--------------------------------
attorney and other authorizations granted to the Lenders, the Administrative
Agent and any Persons designated by the Administrative Agent or any Lender
pursuant to any provisions of this Agreement or any of the other Loan Documents
shall be deemed coupled with an interest and shall be irrevocable so long as any
of the Obligations remain unpaid or unsatisfied or the Revolving Credit Facility
has not been terminated.
SECTION 12.14 Survival of Indemnities. Notwithstanding any
-----------------------
termination of this Agreement, the indemnities to which the Administrative Agent
and the Lenders are entitled under the provisions of this Article XII and any
other provision of this Agreement and the Loan Documents shall continue in full
force and effect and shall protect the Administrative Agent and the Lenders
against events arising after such termination as well as before.
SECTION 12.15 Titles and Captions. Titles and captions of Articles,
-------------------
Sections and subsections in this Agreement are for convenience only, and neither
limit nor amplify the provisions of this Agreement.
SECTION 12.16 Severability of Provisions. Any provision of this
--------------------------
Agreement or any other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remainder of
such provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 12.17 Counterparts. This Agreement 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 shall be
binding upon all parties, their successors and assigns, and all of which taken
together shall constitute one and the same agreement.
SECTION 12.18 Term of Agreement. This Agreement shall remain in
-----------------
effect from the Closing Date through and including the date upon which all
Obligations shall have been indefeasibly and irrevocably paid and satisfied in
full. No termination of this Agreement shall affect the rights and obligations
of the parties hereto arising prior to such termination.
[Signature pages to follow]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, all as of the day and year first
written above.
[CORPORATE SEAL] C-TEC CORPORATION
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
FIRST UNION NATIONAL BANK, as
Administrative Agent and Lender
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
SCHEDULE 1.1(a): LENDERS AND COMMITMENTS
COMMITMENT
AND COMMITMENT
LENDER PERCENTAGE
------ ----------
First Union National Bank $21,000,000
Xxx Xxxxx Xxxxx Xxxxxx, XX-00 16.80%
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Syndication Agency Services
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
CoBank $17,000,000
000 Xxxxxxxx Xxxxxxx, X.X. 13.60%
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Summit Bank $17,000,000.00
000 Xxxxxxxx Xxxx Xxxx 13.60%
Xxxxx 000
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Fleet National Bank $14,000,000
One Federal Street 11.20%
MA OF D0030
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxxxx Xxxxxxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
CoreStates Bank, N.A. $14,000,000
0000 Xxxxxxxx Xxxxxx 11.20%
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
PNC Bank, National Association $14,000,000
00xx Xxxxx Xxxx Xxxx X0-X000-00-0 11.20%
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
The Bank of New York $14,000,000
0 Xxxx Xxxxxx 11.20%
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Bank of Montreal $14,000,000
Xxxx Xxxxxx, 00xx Xxxxx 11.20%
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
================================================================================
CREDIT AGREEMENT
dated as of June 30, 1997,
by and among
C-TEC CORPORATION
as Borrower,
the Lenders referred to herein,
and
FIRST UNION NATIONAL BANK,
as Administrative Agent
================================================================================
TABLE OF CONTENTS
PAGE
EXHIBITS
--------
Exhibit A - Form of Revolving Credit Note
Exhibit B - Form of Notice of Revolving Credit Borrowing
Exhibit C - Form of Notice of Payment
Exhibit D - Form of Notice of Conversion/Continuation
Exhibit E - Form of Officer's Certificate
Exhibit F - Form of Assignment and Acceptance
Exhibit G - Form of Notice of Account Designation
SCHEDULES
---------
Schedule 1.1(a) - Lenders and Commitments
Schedule 1.1(b) - Plan of Reorganization
Schedule 5.1(a) - Jurisdictions of Organization and
Qualification
Schedule 5.1(b) - Subsidiaries and Capitalization
Schedule 5.1(i) - ERISA Plans
Schedule 5.1(l) - Material Contracts
Schedule 5.1(m) - Labor and Collective Bargaining Agreements
Schedule 5.1(s) - Debt and Guaranty Obligations
Schedule 5.1(t) - Litigation
Schedule 5.1(u) - FCC Licenses and PUC Authorizations
Schedule 9.2 - Existing Liens
Schedule 9.3 - Existing Loans, Advances and Investments
