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BRIDGE LOAN AGREEMENT
between
PLD TELEKOM INC.
as Borrower,
and
METROMEDIA INTERNATIONAL GROUP, INC.
as Lender
Dated as of May 18, 1999
$7,000,000
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TABLE OF CONTENTS
Page
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SECTION 1. DEFINITIONS........................................................1
Section 1.1 Definitions..............................................1
SECTION 2. AMOUNT AND TERMS OF CREDIT FACILITY................................7
Section 2.1 Revolving Loans..........................................7
Section 2.2 Notice of Borrowing......................................8
Section 2.3 Disbursement of Funds....................................8
Section 2.4 The Notes................................................8
Section 2.5 Interest.................................................9
Section 2.6 Voluntary Prepayments....................................9
Section 2.7 Method and Place of Payment..............................9
Section 2.8 Taxes...................................................10
SECTION 3. CONDITIONS PRECEDENT..............................................10
Section 3.1 Conditions Precedent to Initial Loans...................10
Section 3.2 Conditions Precedent to All Loans.......................12
SECTION 4. REPRESENTATIONS AND WARRANTIES....................................13
Section 4.1 Qualification...........................................13
Section 4.2 Capitalization of Borrower..............................13
Section 4.3 Authority Relative to this Agreement....................14
Section 4.4 Consents and Approvals; No Violation....................14
Section 4.5 Reports.................................................14
Section 4.6 Financial Statements....................................15
Section 4.7 Undisclosed Liabilities.................................15
Section 4.8 Absence of Certain Changes or Events....................15
Section 4.9 Legal Proceedings, etc..................................17
Section 4.10 Permits.................................................17
Section 4.11 Margin Regulations......................................18
SECTION 5. AFFIRMATIVE COVENANTS.............................................18
Section 5.1 Information Covenants...................................18
Section 5.2 Officer's Certificate...................................20
SECTION 6. NEGATIVE COVENANTS................................................21
Section 6.1 Restriction on Fundamental Changes......................21
Section 6.2 Limitation on Modifications of Certain Documents........21
Section 6.3 Changes in Business.....................................22
Section 6.4 Limitation on Indebtedness..............................22
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Section 6.5 Limitation on Issuances of Guarantees
by Restricted Subsidiaries..............................22
Section 6.6 Limitation on Liens.....................................22
Section 6.7 Use of Proceeds.........................................22
SECTION 7. EVENTS OF DEFAULT.................................................22
Section 7.1 Events of Default.......................................22
Section 7.2 Rights and Remedies.....................................24
SECTION 8. MISCELLANEOUS.....................................................25
Section 8.1 Payment of Expenses, Indemnity, etc.....................25
Section 8.2 Right of Setoff.........................................25
Section 8.3 Notices.................................................26
Section 8.4 Successors and Assigns; Assignments.....................26
Section 8.5 Amendments and Waivers..................................27
Section 8.6 No Waiver; Remedies Cumulative..........................27
Section 8.7 Governing Law, Submission to Jurisdiction...............28
Section 8.8 Counterparts............................................28
Section 8.9 Effectiveness...........................................28
Section 8.10 Headings Descriptive....................................28
Section 8.11 Marshalling; Recapture..................................28
Section 8.12 Severability............................................29
Section 8.13 Survival................................................29
Section 8.14 Limitation of Liability.................................29
Section 8.15 Calculations; Computations..............................29
Section 8.16 Waiver of Trial by Jury.................................29
Section 8.17 Interest Rate Limitation................................29
Exhibit A - Form of Note
Exhibit B - Form of Pledge Agreement
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BRIDGE LOAN AGREEMENT, dated as of May 18, 1999, between PLD Telekom
Inc., a Delaware corporation (the "Borrower"), and Metromedia International
Group, Inc., a Delaware corporation (the "Lender").
WHEREAS, the Lender and the Borrower have entered into an Agreement and
Plan of Merger, dated the date hereof (the "Merger Agreement") pursuant to which
a wholly owned subsidiary of the Lender will be merged with and into the
Borrower with the Borrower as the surviving corporation (the "Merger"); and
WHEREAS, in connection with the Merger, the Borrower has requested that
the Lender make available to it certain short term financing to satisfy working
capital needs of the Borrower from the date hereof until the earlier of the
consummation of the Merger or the termination of the Merger Agreement; and
WHEREAS, the Lender is willing to make loans to the Borrower upon the
terms and conditions set forth herein,
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein and intending to be legally bound
hereby, the Borrower and the Lender hereby agree as follows:
SECTION 1. DEFINITIONS.
Section 1.1 Definitions. As used herein, the following terms shall have
the meanings herein specified unless the context otherwise requires. Defined
terms in this Agreement shall include in the singular number the plural and in
the plural number the singular.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by, or under direct or indirect common
control with such Person. A Person shall be deemed to control a corporation if
such Person possesses, directly or indirectly, the power to (i) vote 10% or more
of the securities having ordinary voting power for the election of directors of
such corporation or (ii) direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise. The term "Affiliate" shall not include the
Lender or any of its direct or indirect Subsidiaries or Affiliates.
"Agreement" shall mean this Credit Agreement as the same may from time
to time hereafter be modified, supplemented or amended.
"Assignee" shall have the meaning provided in Section 8.4(b).
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"Attributable Indebtedness" means, with respect to any Sale and
Leaseback Transaction of any Person, as at the time of determination, the
greater of (i) the capitalized amount in respect of such transaction that would
appear on the balance sheet of such Person in accordance with GAAP and (ii) the
present value (discounted at a rate consistent with accounting guidelines, as
determined in good faith by such Person) of the payments during the remaining
term of the lease (including any period for which such lease has been extended
or may, at the option of the lessor, be extended) or until the earliest date on
which the lessee may terminate such lease without penalty or upon payment of a
penalty (in which case the rental payments shall include such penalty).
"Bankruptcy Code" shall mean Title 11 of the United States Code
entitled "Bankruptcy", as amended from time to time, and any successor statute
or statutes.
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrowing" shall mean the incurrence of a Loan from the Lender on a
given date.
"Business Day" shall mean any day excluding Saturday, Sunday and any
day which shall be in New York City a legal holiday or a day on which banking
institutions are authorized or required by law or other government actions to
close.
"Capital Stock" shall mean any and all shares, interests,
participations or other equivalents in the equity interest (however designated)
in any Person and any rights (other than Indebtedness convertible into an equity
interest), warrants or options to acquire an equity interest in such Person.
"Capitalized Lease" shall mean (i) any lease of property, real or
personal, the obligations under which are capitalized on the consolidated
balance sheet of the Borrower and its Subsidiaries, and (ii) any other such
lease to the extent that the then present value of the minimum rental commitment
thereunder should, in accordance with GAAP, be capitalized on a balance sheet of
the lessee.
"Capitalized Lease Obligations" shall mean all obligations of the
Borrower and its Subsidiaries under or in respect of Capitalized Leases.
"Closing Date" shall have the meaning provided in Section 2.1(a).
"Closing Price" on any Trading Day with respect to the per share price
of any shares of Capital Stock means the last reported sale price regular way
or, in case no such reported sale takes place on such day, the average of the
reported closing bid and asked prices regular way, in either case on the New
York Stock
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Exchange or, if such shares of Capital Stock are not listed or admitted to
trading on such exchange, on the principal national securities exchange on which
such shares are listed or admitted to trading or, if not listed or admitted to
trading on any national securities exchange, on The Nasdaq National Market or,
if such shares are not listed or admitted to trading on any national securities
exchange or quoted on such automated quotation system but the issuer is a
Foreign Issuer (as defined in Rule 3b- 4(b) under the Exchange Act) and the
principal securities exchange on which such shares are listed or admitted to
trading is a Designated Offshore Securities Market (as defined in Rule 902(a)
under the Securities Act), the average of the reported closing bid and asked
prices regular way on such principal exchange, or, if such shares are not listed
or admitted to trading on any national securities exchange or quoted on such
automated quotation system and the issuer and principal securities exchange do
not meet such requirements, the average of the closing bid and asked prices in
the over-the-counter market as furnished by any New York Stock Exchange member
firm that is selected from time to time by the Borrower for that purpose and is
reasonably acceptable to the Lender.
"Common Stock" shall mean the Common Stock, par value $0.01 per share,
of the Borrower, and as the context shall require shall also include any stock
of any class of any other Person which has no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding-up of such Person and which is not subject to redemption
by such Person.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Default Rate" shall have the meaning provided in Section 2.5(b).
"Disqualified Stock" means any Capital Stock which, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchange able), or upon the happening of any event, or otherwise, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof or is exchangeable for
Indebtedness at any time, in whole or in part, on or prior to the date on which
the Loans mature.
"Event of Default" shall have the meaning provided in Section 7.
"Exchange Rate Obligations" means, with respect to any Person, any
currency swap agreements, forward exchange rate agreements, foreign currency
futures or options, exchange rate collar agreements, exchange rate insurance and
other agreements or arrangements, or combination thereof, designed to provide
protection against fluctuations in currency exchange rates.
"Existing Convertible Note Indenture" means the Indenture, dated as of
May 31, 1996, as amended, among the Borrower, the Existing Convertible Note
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Guarantors (as defined therein), Apropos Investments Ltd, Xxxxxxx X. Xxxxx and
The Bank of New York, as trustee thereunder, relating to the Existing
Convertible Notes, as amended and supplemented from time to time.
"Existing Convertible Notes" means the 9% Convertible Subordinated
Notes due 2006 of the Borrower issued pursuant to the Existing Convertible Note
Indenture.
"Existing Debt Agreements" means the Existing Convertible Note
Indenture, the Existing Senior Note Indenture, the documentation related to the
Travelers Revolving Credit Notes, the documentation relating to the News
Promissory Notes and all ancillary agreements related to any of the foregoing.
"Existing Senior Note Indenture" means the Indenture, dated as of May
31, 1996, as amended, among the Borrower, the Existing Senior Note Guarantors
(as defined therein), Apropos Investments Ltd, Xxxxxxx X. Xxxxx and The Bank of
New York, as trustee thereunder, relating to the Existing Senior Notes, as
amended and supplemented from time to time.
"Existing Senior Notes" means the 14% Senior Discount Notes due 2004 of
the Borrower issued pursuant to the Existing Senior Note Indenture.
"Final Maturity Date" shall mean the earlier of (a) the consummation of
the Merger pursuant to the terms of the Merger Agreement or (b) the termination
or expiration of the Merger Agreement.
"GAAP" shall mean United States generally accepted accounting
principles as in effect on the date hereof and consistent with those utilized in
the preparation of the financial statements referred to in Section 5.1.
"Governmental Authority" means (a) the government of the United States
of America or any State or other political subdivision thereof, or any
jurisdiction in which the Borrower or any Subsidiary conducts all or any part of
its business, or which asserts jurisdiction over any property of the Borrower or
any Subsidiary, or (b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.
"Indebtedness" means at any time (without duplication), with respect to
any Person, whether recourse is to all or a portion of the assets of such
Person, and whether or not contingent, (i) any obligation of such Person for
money borrowed, (ii) any obligation of such Person evidenced by bonds,
debentures, notes, guarantees or other similar instruments, including, without
limitation, any such obligations incurred in connection with the acquisition of
Property, assets or businesses, exclud ing trade accounts payable made in the
ordinary course of business, (iii) any xxxx bursement obligation of such Person
with respect to letters of credit, bankers'
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acceptances or similar facilities issued for the account of such Person, (iv)
any obligation of such Person issued or assumed as the deferred purchase price
of Property or services (but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business, which in either case are
not more than 60 days overdue or which are being contested in good faith) (v)
any Capitalized Lease Obligations of such Person, (vi) the maximum fixed
redemption or repurchase price of Disqualified Stock of such Person and, to the
extent held by other Persons, the maximum fixed redemption or repurchase price
of Disqualified Stock of such Person's Restricted Subsidiaries, at the time of
determination, (vii) the notional amount of any Interest Hedging Obligations or
Exchange Rate Obligations of such Person at the time of determination, (viii)
any Attributable Indebtedness with respect to any Sale and Leaseback Transaction
to which such Person is a party and (ix) any obligation of the type referred to
in clauses (i) through (viii) of this definition of another Person and all
dividends and distributions of another Person the payment of which, in either
case, such Person has guaranteed or is responsible or liable, directly or
indirectly, as obligor, guarantor or otherwise. For the purposes of the
preceding sentence, the maximum fixed repurchase price of any Disqualified Stock
that does not have a fixed repurchase price shall be calculated in accordance
with the terms of such Disqualified Stock as if such Disqualified Stock were
repurchased on any date on which Indebtedness shall be required to be determined
pursuant hereto; provided that if such Disqualified Stock is not then permitted
to be repurchased, the repurchase price shall be the book value of such
Disqualified Stock. The amount of Indebtedness of any Person at any date shall
be the outstanding balance at such date of all unconditional obligations as
described above and the maximum liability of any guarantees at such date.
"Interest" shall have the meaning given in Section 2.5 hereof.
"Interest Hedging Obligation" means, with respect to any Person, an
obligation of such Person pursuant to any interest rate swap agreement, interest
rate cap, collar or floor agreement or other similar agreement or arrangement
designed to protect against or manage such Person's or any of its Restricted
Subsidiaries' exposure to fluctuations in interest rates.
"Investment" shall mean all investments in and all loans, advances and
extensions of credit to any Person, all stock, notes, bonds, leases or other
securities or evidences of indebtedness of or any capital contribution to any
corporation, partnership, firm, joint venture or other business entity.
"Lien" means, with respect to any Property or other asset, any mortgage
or deed of trust, pledge, hypothecation, assignment, deposit arrangement,
security interest, lien (statutory or other), charge, easement, encumbrance,
preference, priority or other security or similar agreement or preferential
arrangement of any nature whatsoever on or with respect to such Property or
other asset
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(including, without limitation, any conditional sale or title retention
agreement having substantially the same economic effect as any of the
foregoing).
"Loan Commitment" means the maximum aggregate amount of $7,000,000.
"Loan Documents" shall mean this Agreement, the Note or Notes and the
Pledge Agreement.
"Loan Party" shall mean and include the Borrower and its Subsidiaries.
"Loans" shall have the meaning provided in 2.1(a).
"News Promissory Notes" shall mean the Borrower's promissory notes
issued pursuant to the Revolving Credit Agreement, dated as of September 30,
1998, between the Borrower and News America Incorporated as lender, as the same
may be amended from time to time.
"Note" and "Notes" shall have the meanings provided in Section 2.4.
"Notice of Borrowing" shall have the meaning provided in Section 2.2.
"Obligations" shall mean all obligations, liabilities and Indebtedness
of every nature of the Borrower from time to time owing to the Lender under or
in connection with this Agreement or any other Loan Document.
"Payment Date" shall mean the last day of each month.
"Person" shall mean and include any individual, partnership, joint
venture, firm, corporation, association, trust, limited liability company or
other enterprise or any government or political subdivision or agency,
department or instrumentality thereof.
"Pledge Agreement" means the Pledge Agreement, dated the date hereof,
to be executed by the Borrower, a form of which is attached as Exhibit B hereto.
"Pledged Shares" means the 115 ordinary shares of Technocom that are
subject to the Lien of the Pledge Agreement and any and all dividends,
distributions, payments and proceeds thereof, as more particularly defined in
the Pledge Agreement.
"Property" means, with respect to any Person, any interest of such
Person in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible, excluding Capital Stock in any other Person.
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"Restricted Subsidiary" means any Subsidiary of the Borrower that has
not been classified as an "Unrestricted Subsidiary."
"Sale and Leaseback Transaction" means, with respect to any Person, any
direct or indirect arrangement pursuant to which Property is sold or transferred
by such Person or a Restricted Subsidiary of such Person and is thereafter
leased back from the purchaser or transferee thereof by such Person or one of
its Restricted Subsidiaries.
"Subsidiary" of any Person shall mean and include (i) any corporation
50% or more of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person, directly or indirectly through
Subsidiaries, is either a general partner or has a 50% or more equity interest
at the time.
"Technocom" means Technocom Limited, an Irish corporation and a
Restricted Subsidiary.
"Trading Day" means, with respect to a securities exchange or automated
quotation system, a day on which such exchange or system is open for a full day
of trading.
"Transactions" shall mean each of the transactions contemplated by the
Loan Documents.
"Travelers Revolving Credit Notes" shall mean the Borrower's 12% Series
A Senior Secured Revolving Credit Notes due 1998 and 12% Series B Revolving
Credit Notes due 1998.
"Unrestricted Subsidiary" means any Subsidiary of the Borrower that the
Borrower has classified as an "Unrestricted Subsidiary," and that has not been
reclassified as a Restricted Subsidiary, pursuant to the terms of the
documentation pursuant to which the Revolving Credit Notes were issued.
SECTION 2. AMOUNT AND TERMS OF CREDIT FACILITY.
Section 2.1 Revolving Loans. (a) Subject to and upon the terms and
conditions herein set forth, the Lender agrees, at the times and in the amounts
specified on Schedule 2.1 hereto from the date hereof (the "Closing Date") and
prior to the Final Maturity Date, to make revolving loans (collectively,
"Loans") to the
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Borrower, which Loans shall not at any time exceed in aggregate principal amount
at any time outstanding the Loan Commitment.
(b) Loans may be voluntarily prepaid pursuant to Section 2.6,
and, subject to the other provisions of this Agreement, any amounts so prepaid
may be reborrowed. The Loan Commitment shall expire and the Loans shall mature
on the Final Maturity Date, without further action on the part of the Lender.
(c) Each Borrowing of Loans under this Section 2.1 shall be in
the aggregate minimum amount of the lesser of (i) $250,000 or any integral
multiple of $100,000 in excess thereof or (ii) the remaining unborrowed amount
of the Loan Commitment.
Section 2.2 Notice of Borrowing. Whenever the Borrower desires to
borrow hereunder, the Borrower's Chief Financial Officer shall make a formal
request to the Lender for such Borrowing by giving the Lender prior written
notice thereof (each such notice, a "Notice of Borrowing") on or before 10:00
a.m., New York City time, at least five Business Days prior to the date
requested for such Borrowing, at the Lender's office at Xxx Xxxxxxxxxxx Xxxxx,
Xxxx Xxxxxxxxxx, X.X. 00000; attention: Xxxxxx X. Xxxxxxx, Senior Vice
President; Fax number 201-531- 2804. Each Notice of Borrowing shall specify (a)
the aggregate principal amount of the requested Loan, (b) the proposed date of
the Borrowing (which shall be a Business Day and which shall not exceed the
aggregate amount available for each such month as specified on Schedule 2.1) and
(c) the proposed use of the proceeds of any such Loan, which use of proceeds
shall be solely to make 120% or a lesser portion of each of the items specified
under the headings "operating cash outflows, "investing cash outflows" or
"financing cash outflows" specified on Schedule 2.2 hereto.
Section 2.3 Disbursement of Funds. Upon receipt of a Notice of
Borrowing delivered in accordance with and in compliance with Section 2.2 above,
on the date specified in such Notice of Borrowing, the Lender will make
available the Loans requested to be made on such date, in U.S. dollars by wire
transfer in immediately available funds to an account specified in a written
instrument signed by the Chief Financial Officer of the Borrower and delivered
to Xxxxxx X. Xxxxxxx, Senior Vice President of the Lender, together with any
Notice of Borrowing.
Section 2.4 The Notes. The Borrower's obligation to pay the principal
of, and interest on, each Loan made hereunder, shall be evidenced by a
promissory note (each a "Note", and collectively the "Notes"), duly executed and
delivered by the Borrower, substantially in the form of Exhibit A hereto in a
principal amount equal to the principal amount of the Loan represented thereby,
with blanks appropriately completed in conformity herewith. Each Note shall (x)
be payable to the order of the Lender, (y) be dated the date of the Loan, and
(z) mature on the Final Maturity Date.
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Section 2.5 Interest. (a) The Borrower agrees to pay interest in
respect of the unpaid principal amount of each Loan ("Interest") from the date
of the making of such Loan until such Loan shall be paid in full at a rate per
annum which shall be equal to ten percent (10%) per annum, such Interest to be
computed on the basis of a 360-day year and the actual number of days elapsed.
(b) In the event that, and for so long as, any Event of
Default shall have occurred and be continuing, the outstanding principal amount
of all Loans and, to the extent permitted by law, overdue interest in respect of
all Loans, shall bear interest at a rate per annum (the "Default Rate") equal to
twelve percent (12%) per annum, computed on the basis of a 360-day year and the
actual number of days elapsed; provided that nothing in any Loan Document shall
permit the Lender to receive interest in excess of the maximum rate of interest
permitted by law.
(c) Interest on each Loan shall accrue from and including the
date of the Borrowing thereof to but excluding the date of any repayment thereof
(provided that any Loan borrowed and repaid on the same day shall accrue one
day's interest) and shall be payable on the last Business Day of each calendar
month while any Loan is outstanding unless otherwise specified in the Note
relating to such Loan. Any accrued but otherwise unpaid interest shall also be
payable on the Final Maturity Date and concurrently with the amount of each
voluntary prepayment, as provided in Section 2.6 hereof.
Section 2.6 Voluntary Prepayments. The Borrower shall have the right to
prepay the Loan represented by each Note in whole or in part from time to time
on the following terms and conditions: (i) the Borrower shall give the Lender
written notice (or telephonic notice promptly confirmed in writing), which
notice shall be irrevocable, of its intent to prepay the Loan, at least five
Business Days prior to a prepayment, which notice shall specify the date (which
shall be a Business Day) and the amount of such prepayment and (ii) each
prepayment shall be in an aggregate principal amount of $250,000 or any integral
multiple of $100,000 in excess thereof.
Section 2.7 Method and Place of Payment. (a) Except as otherwise
specifically provided herein, all payments and prepayments under this Agreement
and the Notes shall be made to the Lender not later than 12:00 noon, New York
City time, on the date when due and shall be made in lawful money of the United
States of America by wire transfer in immediately available funds to Chase
Manhattan Bank, New York, NY, ABA number 000000000, to the account of Metromedia
International Group, Inc., Account No. 323-012671, or such other account as
specified in a written instrument signed by Xxxxxxx Xxxxx or a senior vice
president of the Lender and delivered to the Chief Financial Officer of the
Borrower, and any funds received by the Lender after such time shall, for all
purposes hereof, be deemed to have been paid on the next succeeding Business
Day.
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(b) Whenever any payment to be made hereunder or under the
Notes shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable at the applicable
rate during such extension.
(c) All payments made by the Borrower hereunder and under any
Note shall be made irrespective of, and without any reduction for, any setoff or
counterclaims, including, without limitation, any setoff or counterclaims
arising due to a breach or alleged breach by the Lender or any of its
Subsidiaries or Affiliates of any other agreement to which the Lender or any of
its Subsidiaries or Affiliates and any of the Loan Parties are parties.
Section 2.8 Taxes. All payments made by the Borrower under this
Agreement shall be made free and clear of, and without reduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority excluding, in the case of the Lender, net income and franchise taxes
imposed on the Lender by the jurisdiction under the laws of which the Lender is
organized or any political subdivi sion or taxing authority thereof or therein
(all such non-excluded taxes, levies, imposts, deductions, charges or
withholdings being hereinafter called "Taxes"). If any Taxes are required to be
withheld from any amounts payable to the Lender hereunder or under any Note, the
amounts so payable to the Lender shall be increased to the extent necessary to
yield to the Lender (after payment of all Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement and the specific Note. Whenever any Taxes are payable by the Borrower,
as promptly as possible thereafter, the Borrower shall send to the Lender a
certified copy of an original official receipt received by the Borrower showing
payment thereof. If the Borrower fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Lender the required
receipts or other required documentary evidence, the Borrower shall indemnify
the Lender for any incremental taxes, interest or penalties that may become
payable by the Lender as a result of any such failure. The agreements in this
Section 2.9 shall survive the termination of this Agreement and the payment of
the Notes and all other Obligations.
SECTION 3. CONDITIONS PRECEDENT.
Section 3.1 Conditions Precedent to Initial Loans. In addition to the
provisions of Section 2.2, the obligation of the Lender to make its initial
Loans is subject to the satisfaction on the Closing Date of the following
conditions precedent:
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(a) Loan Documents.
(i) Credit Agreement. The Borrower shall have
executed and delivered this Agreement to the Lender.
(ii) Note. The Borrower shall have executed and
delivered to the Lender a Note in the amount of the initial Loan at
maturity and as otherwise provided herein.
(iii) Pledge Agreement. The Borrower shall have
executed and delivered the Pledge Agreement to the Lender.
(b) Opinion of Counsel. The Lender shall have received a legal
opinion, dated the Closing Date, from Xxxxx Xxxxxxxx, Esq., Senior Vice
President, General Counsel and Secretary of the Borrower, in form reasonably
satisfactory to the Lender.
(c) Corporate Documents. The Lender shall have received the
Certificate of Incorporation of the Borrower as in effect on the Closing Date,
certified to be true, correct and complete by the Secretary of State of the
State of Delaware.
(d) Certified Resolutions, etc. The Lender shall have received
a certificate of the Secretary or Assistant Secretary of the Borrower dated the
Closing Date certifying (i) the names and true signatures of the incumbent
officers of such Person authorized to sign the applicable Loan Documents, (ii)
the By-Laws of such Person as in effect on the Closing Date, (iii) the
resolutions of such Person's Board of Directors approving and authorizing the
execution, delivery and performance the Loan Documents, and (iv) that there have
been no changes in the Certificate of Incorporation of such Person since the
date of the most recent certification thereof by the appropriate Secretary of
State.
(e) Delivery of Pledged Shares and Registration in Share
Registry. The Borrower shall have delivered to the Lender stock certificates
representing the Pledged Shares, registered in the name of the Borrower,
accompanied by undated stock powers duly executed in blank and the Lender shall
have been registered in the share register of Technocom as the registered owner
of the Pledged Shares. The Pledge Agreement and/or prior notices, statements or
other instruments in respect thereof, including, without limitation, financing
statements on Form UCC-1, shall have been duly recorded, published, registered
and filed in such manner and in such places as are required by law to establish,
perfect and preserve and protect the security interests of the Lender in the
Pledged Shares; and all taxes, fees and other charges in connection with the
execution, delivery, recording, publishing, registration and filing of such
instruments and the offer, issue and delivery of the
12
Notes and the making by the Lender of the Loans and any other Obligations shall
have been paid in full.
(f) Technocom Organizational Documents. The Lender shall have
received complete and correct copies of:
(i) the Memorandum of Association and Articles of
Association and other constitutive documents of Technocom together with a
certified copy of a written resolution of the shareholders of Technocom amending
Articles 11 and 32 of such Articles of Association and approving the transfer of
the Pledged Shares pursuant to the Pledge Agreement upon a foreclosure; and
(ii) all agreements with respect to the Technocom
Capital Stock as amended from time to time.
(g) Representations. The representations and warranties set
forth in Section 4 shall be true and correct on such date before and after
giving effect to the making of the Loan on such date (except for representations
and warranties which refer to another date, which shall be true and correct as
of such date).
(h) Additional Matters. The Lender shall have received such
other certificates, opinions, documents and instruments relating to the Transac
tions as may have been reasonably requested by the Lender, and all corporate and
other proceedings and all other documents (including, without limitation, all
docu ments referred to herein and not appearing as exhibits hereto) and all
legal matters in connection with the Transactions shall be satisfactory in form
and substance to the Lender.
Section 3.2 Conditions Precedent to All Loans. In addition to the
provisions of Section 2.2, the obligation of the Lender to make any Loan
(including any initial Loan made on the Closing Date) is subject to the
satisfaction on the date such Loan is made of the following conditions
precedent:
(a) Notes. The Borrower shall have executed and delivered to
the Lender a Note in the amount of the principal amount of the Loan represented
thereby at maturity and as otherwise provided herein.
(b) No Default or Event of Default. No Default or Event of
Default shall have occurred and be continuing on such date either before or
after giving effect to the making of such Loans.
(c) Representations. The representations and warranties set
forth in Section 4 shall be true and correct on such date before and after
giving effect to the making of the Loan on such date (except for representations
and
13
warranties which refer to another date, which shall be true and correct as of
such date).
(d) No Injunction. No law or regulation shall have been
adopted, no order, judgment or decree of any Governmental Authority shall have
been issued, and no litigation shall be pending or threatened, which in the
judgment of the Lender would enjoin, prohibit or restrain, or impose or result
in the imposition of any material adverse condition upon, the making or
repayment of the Loans.
The acceptance of the proceeds of each Loan shall constitute a
representation and warranty by the Borrower to the Lender that all of the
conditions required to be satisfied under this Section 3 in connection with the
making of such Loan have been satisfied.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
In order to induce the Lender to enter into this Agreement and to make
the Loans, the Borrower makes the following representations and warranties,
which shall survive the execution and delivery of this Agreement and the Notes
and the making of the Loans:
Section 4.1 Qualification. The Borrower is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and has all requisite corporate power and authority to own, lease, and
operate its proper ties and to carry on its business as now being conducted. The
Borrower is duly qualified or licensed to do business as a foreign corporation
and is in good standing in each jurisdiction in which the property owned, leased
or operated by it or the nature of the business conducted by it makes such
qualification necessary. Schedule 4.1 sets forth, as of the date of this
Agreement, each jurisdiction in which the Borrower is qualified to do business
as a foreign corporation. The Borrower has heretofore delivered to the Lender
complete and correct copies of its Certificate of Incorporation and By-laws as
currently in effect.
Section 4.2 Capitalization of Borrower. Set forth on Schedule 4.2 is
the number of shares of Capital Stock or other equity interests of the Borrower
which are issued and outstanding as of the date of this Agreement. All such
shares are validly issued, fully paid and nonassessable. Other than this
Agreement, or as set forth in Schedule 4.2, there is no subscription, option,
warrant, call, right, agreement or commitment relating to the issuance, sale,
delivery or transfer by the Borrower of any of its shares of Capital Stock or
other equity interests (including any right of conversion or exchange under any
outstanding security or other instrument). There are no outstanding contractual
obligations of the Borrower to repurchase, redeem or otherwise acquire any
outstanding shares of its Capital Stock or other equity interests of the
Borrower. There are no restrictions or limitations contained in the
organizational documents of the
14
Borrower or in any contract, agreement, document or other instrument to which
the Borrower or any of its direct or indirect subsidiaries is a party or of
which the Borrower or any of its direct or indirect subsidiaries is aware that
restricts, or purports to restrict, the ability of the Borrower or any of its
direct or indirect subsidiaries to enter into and perform its obligations under
the Loan Documents.
Section 4.3 Authority Relative to this Agreement. The Borrower has full
corporate power and authority to execute, deliver and perform its obligations
under this Agreement and all ancillary agreements to which it is a party and to
consummate the Transactions contemplated hereby and thereby. The execution and
delivery of this Agreement and all ancillary agreements to which it is a party
and the consummation of the Transactions contemplated hereby and thereby have
been duly and validly authorized by all corporate and shareholder action, and no
other corporate proceedings on the part of the Borrower are necessary to
authorize this Agreement or to consummate the Transactions contemplated hereby
and thereby. The Loan Documents have been duly and validly executed and
delivered by the Borrower, and assuming that this Agreement constitutes a valid
and binding agreement of the Lender, constitute valid and binding agreements of
the Borrower, enforceable against the Borrower in accordance with its terms,
except that such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium or other similar laws affecting or relating to the
enforcement of creditors' rights generally or general principles of equity.
Section 4.4 Consents and Approvals; No Violation. (a) Except as set
forth in Schedule 4.4, the execution and delivery by the Borrower of this
Agreement and each other Loan Document will not (i) conflict with or result in
any breach of any provision of the Certificate of Incorporation or Bylaws or
similar charter documents of the Borrower, (ii) require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority, (iii) result in a default (or give rise to any right of
termination, cancellation or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, agreement or other
instrument or obligation to which the Borrower or any of its Subsidiaries is a
party or by which the Borrower or any of its Subsidiaries or any of their assets
may be bound, except for such defaults (or rights of termination, cancellation
or acceleration) as to which requisite waivers or consents have been obtained,
or (iv) violate any order, writ, injunction, decree, statute, rule or regulation
applicable to the Borrower, any of its Subsidiaries or any of their assets.
(b) No declaration, filing or registration with, or notice to,
or authorization, consent or approval of any governmental or regulatory body or
authority is necessary for the consummation by the Borrower of the Transactions.
Section 4.5 Reports. Since January 1, 1999, the Borrower has, pursuant
to the Securities Act of 1933, as amended (the "Securities Act",) and the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), filed or
caused to be filed with the SEC all material forms, statements, reports and
documents (including
15
all exhibits, amendments and supplements thereto) required to be filed by it
with respect to the business and operations of the Borrower and its Subsidiaries
under each of the Securities Act and the Exchange Act and the respective rules
and regulations thereunder, all of which complied in all material respects with
all applicable requirements of the appropriate act and the rules and regulations
thereunder in effect on the date each such report was filed. True and complete
copies of each of such forms, statements, reports and documents, and such
exhibits, have been delivered to the Lender.
Section 4.6 Financial Statements. The Borrower has previously furnished
to the Lender copies of (a) the Borrower's audited (i) consolidated balance
sheets as of December 31, in each of the years 1998, 1997 and 1996 and (ii)
related consolidated statements of income and retained earnings and consolidated
changes in financial position of the Borrower for the fiscal years then ended,
together with the respective reports thereon of KPMG Peat Marwick LLP and KPMG,
as independent auditors of the Borrower for 1998, and 1997 and 1996,
respectively; and (b) the Borrower's unaudited (i) consolidated balance sheet as
of March 31, 1999 and (ii) related consolidated statements of income and
retained earnings and consolidated changes in financial position. Each of the
balance sheets included in the financial statements referred to in this Section
4.6 (including the related notes thereto) present fairly the financial
information purported to be set therein as of the dates thereof, and the other
related statements included therein (including the related notes thereto)
present fairly the results of operations and changes in financial position for
the periods then ended, all in conformity with GAAP applied on a consistent
basis, except as otherwise noted therein. For purposes of this Agreement, the
audited consolidated balance sheet of the Borrower as of December 31, 1998 are
hereinafter referred to as the "Borrower's Balance Sheet".
Section 4.7 Undisclosed Liabilities. Except as set forth in Schedule
4.7 or in the unaudited balance sheet or the notes thereto as of December 31,
1998, the Borrower does not have any material liability or obligation, secured
or unsecured (whether absolute, accrued, contingent or otherwise, and whether
due or to become due), of a nature required by generally accepted accounting
principles to be reflected in a corporate balance sheet or disclosed in the
notes thereto, which is not accrued or reserved against in the Borrower's
Balance Sheet or disclosed in the notes thereto in accordance with GAAP.
Section 4.8 Absence of Certain Changes or Events. Except as set forth
in Schedule 4.8 or in the Borrower's Annual Report on Form 10-K/A for the year
ended December 31, 1998, or the Borrower's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 1999, since the date of the Borrower's Balance
Sheet there has not been:
(a) any material adverse change in the business, prospects,
operations, properties, assets, liabilities, competition, earnings, or condition
(financial or otherwise) of the Borrower and its Subsidiaries, or any failure by
the Borrower or any of its Subsidiaries to pay its debts when due;
16
(b) any event or condition of any character which either
individually or in the aggregate, might reasonably be expected to have a
material adverse effect on the business, prospects, operations, properties,
assets, liabilities, competition, earnings or condition (financial or
otherwise), of the Borrower and its Subsidiaries;
(c) any damage, destruction or loss (regardless of whether
covered by insurance) that might reasonably be expected to have a material
adverse effect on the business, prospects, operations, properties, assets,
liabilities, competition, earnings, or condition (financial or otherwise), of
the Borrower and its Subsidiaries;
(d) any declaration, setting aside or payment of any dividend
or other distribution (whether in cash, stock, property, or any combination of
the foregoing) with respect to the capital stock or other equity interest of the
Borrower, except as specifically provided for in this Agreement or the Merger
Agreement and the transactions contemplated thereby;
(e) any increase in the compensation paid, payable or to
become payable by the Borrower to its officers, directors or employees (other
than increases for employees in the ordinary course of business and consistent
with past practice), any hiring of new officers, directors or employees (other
than hiring of new employees in the ordinary course of business consistent with
past practice) or any increase in any bonus, insurance, pension or other
employee benefit plan, payments or arrangement (including loans) made to, for or
with any officers, directors, or employees (other than increases for employees
in the ordinary course of business and consistent with past practice or other
increases pursuant to written employee benefit plans);
(f) except for the Merger Agreement and the transactions
contemplated thereby or in this Agreement, any entry into, material amendment
of, or termination of, any material agreement, material commitment or material
transaction by the Borrower, including, without limitation, any (i) merger,
consolidation, share exchange, acquisition or disposition of assets or stock or
any financing transaction or capital expenditure, (ii) indenture, mortgage,
note, agreement or other instrument relating to the borrowing of money (other
than inter company accounts), (iii) partnership or joint venture agreement, (iv)
material license agreement relating to intellectual property (other than
off-the-shelf software licenses), or (v) agreement to amend its charter or other
organizational documents or any other document, contract, agreement,
arrangement, undertaking or instrument relating to any of the foregoing;
(g) any entry into, material change to the terms or conditions
of termination of, any license, permit, franchise, governmental approval or
decree pursuant to which the Borrower or its Subsidiaries provide telephony,
data transmission or other telecommunications services;
17
(h) any notes or accounts receivable or portions of notes or
accounts receivable written off by the Borrower or its Subsidiaries as
uncollectible, other than in the ordinary course of business and consistent with
past practice;
(i) any material obligation or material liability paid
(whether absolute, accrued, contingent or otherwise), or any lien or encumbrance
in connection therewith discharged, by the Borrower or any of its Subsidiaries,
other than (i) in the ordinary course of business and consistent with past
practice, or (ii) current liabilities shown on the financial statements and
current liabilities incurred since their date;
(j) except as specifically provided for in the Merger
Agreement and the transactions contemplated thereby or in this Agreement, any
properties or assets, real, personal or mixed, tangible or intangible, of the
Borrower or any of its Subsidiaries mortgaged, pledged or subjected to any
security interest, Lien or encumbrance;
(k) except as specifically provided for in the Merger
Agreement and the transactions contemplated thereby or in this Agreement, any
sale, assignment transfer, lease, dividend, distribution or other disposition of
any of property or assets by the Borrower or any of its Subsidiaries, other than
sales of products in the ordinary course of business; or
(l) except as specifically provided for in the Merger
Agreement and the transactions contemplated thereby or in this Agreement, any
agreement, understanding or undertaking to do any of the foregoing by the
Borrower or any of its Subsidiaries.
Section 4.9 Legal Proceedings, etc. Except as set forth in Schedule
4.9, there are no claims, actions, or proceedings pending or investigation
pending or, to the Borrower's knowledge, threatened against or relating to the
Borrower before any court, governmental or regulatory authority or body acting
in an adjudicative capacity. Except as set forth in Schedule 4.9, the Borrower
is not subject to any outstanding judgment rule, order, writ, injunction or
decree of any court, governmental or regulatory authority.
Section 4.10 Permits. The Borrower and its Subsidiaries have all
material permits, licenses, franchises and other governmental authorizations,
consents and approvals (collectively, "Permits") necessary to conduct their
business as presently conducted. Except as set forth in Schedule 4.10, neither
the Borrower nor any of its Subsidiaries has received any written notification
that it is in violation of any of such Permits, or any law, statute, order,
rule, regulation, ordinance or judgment of any governmental or regulatory body
or authority applicable to it. The Borrower and its Subsidiaries are in
compliance with all material Permits, laws, statutes, orders, rules,
regulations, ordinances, or judgments of any governmental or regulatory body or
authority applicable to them.
18
Section 4.11 Margin Regulations. No part of the proceeds of any Loan
will be used by the Borrower to purchase or carry any Margin Stock or to extend
credit to others for the purpose of purchasing or carrying any Margin Stock.
Neither the making of any Loan nor the use of the proceeds thereof will violate
or be inconsistent with the provisions of Regulations T, U or X of the Federal
Reserve Board.
SECTION 5. AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that on and after the Closing Date
and until the Loan Commitment has terminated and the Obligations are paid in
full at the Final Maturity Date:
Section 5.1 Information Covenants. The Borrower will furnish to the
Lender:
(a) Quarterly Statements - within 45 days after the end of
each quarterly fiscal period in each fiscal year of the Borrower (other than the
last quarterly fiscal period of each such fiscal year), duplicate copies of
(i) a consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such quarter, and
(ii) consolidated statement of operations,
shareholders equity and changes in financial position of the Borrower and its
Subsidiaries for such quarter and (in the case of the second and third quarters)
for the portion of the fiscal year ending with such quarter, in each case
setting forth in comparative form the figures for the corresponding periods in
the previous fiscal year, prepared in accordance with GAAP applicable to
quarterly financial statements generally, and certified by the Chief Financial
Officer of the Borrower as fairly presenting, in all material respects, the
financial position of the companies being reported on and their results of
operations and cash flows, except for the absence of footnotes and changes
resulting from year-end adjustments, provided that delivery within the time
period specified above of the Borrower's Quarterly Report on Form 10-Q prepared
in compliance with the requirements therefor and filed with the SEC shall be
deemed to satisfy the requirements of this Section 5.1;
(b) Annual Statements - within 90 days after the end of each
fiscal year of the Borrower, duplicate copies of
(i) a consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such year, and
(ii) consolidated statements of operations,
shareholders' equity and changes in financial position of the Borrower and its
Subsidiaries for such
19
year, setting forth in each case in comparative form the figures for the
previous fiscal year, prepared in accordance with GAAP, and accompanied by
(A) an opinion thereon of
independent certified public accountants of recognized national
standing, which opinion shall state that such financial statements
present fairly, in all material respects, the financial position of the
companies being reported upon and their results of operations and cash
flows and have been prepared in conformity with GAAP, and that the
examination of such accountants in connection with such financial
statements has been made in accordance with generally accepted auditing
standards, and that such audit provides a reasonable basis for such
opinion in the circumstances, and
(B) a certificate of such
accountants stating that in making the examination necessary for
certification of such financial statements pursuant to the preceding
subclause (A), such accountants have obtained no knowledge of any
Default or Event of Default or, if in the opinion of such accountants
such a Default or Event of Default has occurred and is continuing, a
statement as to the nature thereof,
provided that the delivery within the time period specified above of the
Borrower's Annual Report on Form 10-K for such fiscal year (together with the
Borrower's annual report to shareholders, if any, prepared pursuant to Rule
14a-3 under the Exchange Act) prepared in accordance with the requirements
therefor and filed with the SEC, together with the accountant's certificate
described in subclause (B) above, shall be deemed to satisfy the requirements of
this Section 5.1(c);
(c) Audit Reports, etc. - promptly (and in any event within
five Business Days) after receipt thereof, copies of all management letters and
reports submitted to the Borrower or any of its Subsidiaries by independent
certified public accountants in connection with any annual, interim or special
audit of the Borrower or any Subsidiary made by such accountants;
(d) SEC and Other Reports - promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or proxy
statement sent by the Borrower or any Subsidiary to public securities holders
generally, and (ii) each regular or periodic reports, each registration
statement (without exhibits except as expressly requested by the Lender), and
each prospectus and all amendments thereto filed by the Borrower or any
Subsidiary with the SEC and of all press releases and other statements made
available generally by the Borrower or any Subsidiary to the public concerning
developments that are material;
(e) Notice of Default or Event of Default - immediately (and
in any event within two Business Days) after the President, Chief Financial
Officer, General Counsel or other executive officer of the Borrower becomes
aware of the existence of any Default or Event of Default or that any Person has
given any notice or
20
taken any action with respect to a claimed Default hereunder or that any Person
has given any notice or taken any action with respect to a claimed default of
the type referred to in Section 7.1(c), a written notice specifying the nature
and period of existence thereof and what action the Borrower is taking or
proposes to take with respect thereto;
(f) Notices with Respect to Existing Senior Note Indenture,
Existing Convertible Note Indenture, Travelers Revolving Credit Notes and News
Promissory Notes - promptly upon the delivery thereof to the holders of the
Existing Senior Notes, the Existing Convertible Notes, the Travelers Revolving
Credit Notes and the News Promissory Notes, respectively, or a trustee or other
representative on their behalf, copies of all notices delivered by the Borrower
or any of its Subsidiaries to such holders, trustee or other representative; and
promptly upon the execution and delivery thereof, true, complete and correct
copies of all amendments and modifications to and waivers under the Existing
Senior Note Indenture, the Existing Convertible Note Indenture, documentation
for the Travelers Revolving Credit Notes and the documentation for the News
Promissory Notes respectively;
(g) Notices from Governmental Authority - promptly, and in any
event within five days of receipt thereof, copies of any notice to the Borrower
or any Subsidiary from any federal, state or foreign Governmental Authority
relating to any order, ruling, statute or other law or regulation that could
reasonably be expected to have a material adverse effect on the assets,
liabilities (actual or contingent), business, financial condition, results of
operations or prospects of the Borrower or any of its Subsidiaries or that could
reasonably be expected to impair the ability of the Borrower to perform any of
its obligations hereunder or under any of the Loan Documents; and
(h) Requested Information - with reasonable promptness, such
other data and information relating to the business, operations, affairs,
financial condition, assets or property of the Borrower or any of its
Subsidiaries or relating to the ability of the Borrower to perform its
obligations hereunder, under the Notes and under the Pledge Agreement as from
time to time may be reasonably requested by the Lender.
Section 5.2 Officer's Certificate. Each set of financial statements
delivered to the Lender pursuant to Section 5.l(a), Section 5.l(b) or Section
5.l(c) hereof shall be accompanied by a certificate of the Chief Financial
Officer containing a statement that such officer has reviewed the relevant terms
hereof and has made, or caused to be made, under his or her supervision, a
review of the transactions and conditions of the Borrower and its Subsidiaries
from the beginning of the quarterly or annual period covered by the statements
then being furnished to the date of the certificate and that such review shall
not have disclosed the existence during such period of any condition or event
that constitutes a Default or an Event of Default or, if any such condition or
event existed or exists, specifying the nature and period of existence thereof
and what action the Borrower or its Subsidiaries shall have taken or proposes to
take with respect thereto.
21
SECTION 6. NEGATIVE COVENANTS.
The Borrower covenants and agrees that on and after the Closing Date
until the Loan Commitment has terminated, and the Obligations are paid in full,
without the prior written consent of Lender:
Section 6.1 Restriction on Fundamental Changes.
(a) Except as contemplated by the Merger Agreement, the
Borrower shall not, and shall not permit any of its Subsidiaries to, enter into
any merger or consolidation, or liquidate, wind-up or dissolve (or suffer any
liquidation or dissolution), discontinue its business or convey, lease, sell,
transfer or otherwise dispose of, in one transaction or in a series of
transactions, all or any material part of its business or property, whether now
or hereafter acquired.
(b) Except as contemplated by the Merger Agreement, the
Borrower shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, (i) make any dividend or other distribution of any kind whatsoever
on the Common Stock of the Borrower (including without limitation any
distribution paid exclusively in Common Stock), or make any Restricted Payment
(as such term is defined in the Existing Senior Note Indenture) except as
permitted by Section 4.13 of the Existing Senior Note Indenture, (ii) issue to
any holders of its Common Stock any rights, options or warrants entitling the
holders thereof to subscribe for or purchase any shares of Common Stock or
securities convertible into or exchangeable for Common Stock, other than
pursuant to the Equity Compensation Plan, (iii) reclassify, subdivide or combine
its outstanding shares of Common Stock, (iv) distribute to holders of its Common
Stock evidences of its indebtedness, shares of any class of its Capital Stock
cash or other assets, or any securities or other instruments representing the
right to buy, or convertible into or exchangeable for, evidences of its
indebtedness, shares of any class of its Capital Stock or cash or any other
assets, (v) issue shares of its Common Stock other than pursuant to the terms of
the Existing Convertible Notes or options or warrants existing as at the date of
this Agreement or (vi) purchase, in the open market or in any privately-
negotiated transaction or otherwise, or make any tender or exchange offer for,
all or any portion of the Common Stock of the Borrower.
(c) The Borrower shall not and shall not permit any of its
Subsidiaries to, amend its certificate of incorporation or by-laws or its
accounting policies or reporting practices.
Section 6.2 Limitation on Modifications of Certain Documents. Except as
contemplated by the Merger Agreement, the Borrower shall not, and shall not
permit any of its Subsidiaries to, amend, modify or waive, or permit the
amendment, modification or waiver of, any provision of any material contracts
(including, without limitation, any of the documentation pursuant to which the
Existing Senior Notes, the
22
Existing Convertible Notes, the Travelers Revolving Credit Notes and the News
Promissory Notes were issued, and any of the documents ancillary thereto).
Section 6.3 Changes in Business. The Borrower shall not, and shall not
permit any of its Subsidiaries to, enter into any business which is
substantially different from that conducted by the Borrower or such Loan Party,
as the case may be, on the Closing Date.
Section 6.4 Limitation on Indebtedness. The Borrower will not, and will
not permit its Restricted Subsidiaries to, directly or indirectly, incur any
Indebtedness and the Borrower will not issue any Disqualified Stock or permit
any of its Restricted Subsidiaries to issue any Disqualified Stock, in each
case, except as permitted by Section 4.9 of the Existing Senior Note Indenture.
Section 6.5 Limitation on Issuances of Guarantees by Restricted
Subsidiaries. The Borrower will not permit any Restricted Subsidiary to
guarantee, directly or indirectly, any Indebtedness of the Borrower other than
the Existing Senior Notes, the Existing Convertible Notes, the Travelers
Revolving Credit Notes, the News Promissory Notes and the Notes.
Section 6.6 Limitation on Liens. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, enter
into, create, incur, assume or suffer to exist any Liens of any kind other than
Permitted Liens (as such term is defined in the Existing Senior Note Indenture)
on or with respect to any of its Property or assets now owned or hereafter
acquired, or any interest therein or any income or profits therefrom, without
effectively providing that the Notes shall be secured equally and ratably with
(and provided that the Notes shall be secured prior to any secured obligation
that is subordinated in right of payment to the Notes) the obligations so
secured for so long as such obligations are so secured.
Section 6.7 Use of Proceeds. The Borrower will not use the proceeds of
any Loan for any purpose other than those specified on Schedule 2.2 hereto.
SECTION 7. EVENTS OF DEFAULT.
Section 7.1 Events of Default. Each of the following events, acts,
occurrences or conditions shall constitute an Event of Default under this
Agreement, regardless of whether such event, act, occurrence or condition is
voluntary or involuntary or results from the operation of law or pursuant to or
as a result of compliance by any Person with any judgment, decree, order, rule
or regulation of any court or administrative or governmental body:
(a) Failure to Make Payments. The Borrower shall (i) default
in the payment when due of any principal of the Loans or (ii) default in the
payment
23
when due of any interest on the Loans or in the payment when due of any other
amounts owing hereunder, and in the case of the circumstances described in this
clause (ii), such default shall continue unremedied for three or more Business
Days.
(b) Breach of Covenants.
(i) The Borrower shall fail to perform or observe any
agreement, covenant or obligation arising under Sections 5 or 6.
(ii) The Borrower shall fail to perform or observe
any agreement, covenant or obligation arising under this Agreement
(except those described in subsections (a) and (b)(i) above), and such
failure shall continue for 30 days.
(c) Default Under Other Agreements. Any Loan Party shall
default in the payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise) of any amount owing in respect of
any Indebtedness (including any Indebtedness under the Existing Senior Notes,
the Existing Convertible Notes, the Travelers Revolving Credit Notes or the News
Promissory Notes) (other than the Obligations); or any Loan Party shall default
in the performance or observance of any obligation or condition with respect to
any such Indebtedness or any other event shall occur or condition exist, if the
effect of such default, event or condition is to accelerate the maturity of any
such Indebtedness or to permit (without regard to any required notice or lapse
of time) the holder or holders thereof, or any trustee or agent for such
holders, to accelerate the maturity of any such Indebtedness, or any such
Indebtedness shall become or be declared to be due and payable prior to its
stated maturity other than as a result of a regularly scheduled payment.
(d) Pledge Agreement. The Pledge Agreement shall at any time
and for any reason not be or shall cease to be valid, binding and enforceable
against the Borrower or a permitted successor or assign or the Borrower shall
contest or deny the validity and enforceability of the Pledge Agreement or shall
disaffirm or repudiate any of its obligations thereunder, or the Notes (or any
of them) shall fail to be secured by a perfected security interest in the
Pledged Shares.
(e) Bankruptcy, etc. (i) Any Loan Party shall commence a
voluntary case concerning itself under the Bankruptcy Code; or (ii) an
involuntary case is commenced against any Loan Party and the petition is not
controverted within 10 days, or is not dismissed within 60 days, after
commencement of the case; or (iii) a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of any Loan Party or any Loan Party commences any other proceedings
under any reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar law of any jurisdiction
whether now or hereafter in effect relating to any Loan Party or there is
commenced against any Loan Party any such proceeding which remains undismissed
for a period of 60 days; or
24
(iv) any order of relief or other order approving any such case or proceeding is
entered; or (v) any Loan Party is adjudicated insolvent or bankrupt; or (vi) any
Loan Party suffers any appointment of any custodian or the like for it or any
substantial part of its property to continue undischarged or unstayed for a
period of 60 days; or (vii) any Loan Party makes a general assignment for the
benefit of creditors; or (viii) any Loan Party shall fail to pay, or shall state
that it is unable to pay, or shall be unable to pay, its debts generally as they
become due; or (ix) any Loan Party shall call a meeting of its creditors with a
view to arranging a composition or adjustment of its debts; or (x) any Loan
Party shall by any act or failure to act consent to, approve of or acquiesce in
any of the foregoing; or (xi) any corporate action is taken by any Loan Party
for the purpose of effecting any of the foregoing.
(f) Judgments. One or more judgments or decrees in an
aggregate amount of $1,000,000 or more shall be entered by a court or courts of
competent jurisdiction against the Loan Parties (other than any judgment as to
which, and only to the extent, a reputable insurance company has acknowledged
coverage of such claim in writing) and (i) any such judgments or decrees shall
not be stayed, discharged, paid, bonded or vacated within 10 days or (ii)
enforcement proceedings shall be commenced by any creditor on any such judgments
or decrees.
Section 7.2 Rights and Remedies. Upon the occurrence of any Event of
Default described in Section 7.1(e), the Loan Commitment shall automatically and
immediately terminate and the unpaid principal amount of, and any and all
accrued interest on, the Loan and any and all other Obligations shall
automatically become immediately due and payable, with all additional interest
from time to time accrued thereon and without presentation, demand, or protest
or other requirements of any kind (including, without limitation, valuation and
appraisement, due diligence, presentment, notice of intent to demand or
accelerate and notice of acceleration), all of which are hereby expressly waived
by the Borrower, and the obligation of the Lender to make any Loan hereunder
shall thereupon terminate; and upon the occurrence and during the continuance of
any other Event of Default, the Lender may, by written notice to the Borrower,
(i) declare that the Loan Commitment is terminated, whereupon the Loan
Commitment and the obligation of the Lender to make any Loan hereunder shall
immediately terminate, and (ii) declare the unpaid principal amount of and any
and all accrued and unpaid interest on the Loans and any and all other
Obligations to be, and the same shall thereupon be, immediately due and payable
with all additional interest from time to time accrued thereon and without
presentation, demand, or protest or other requirements of any kind (including,
without limitation, valuation and appraisement, diligence, presentment, notice
of intent to demand or accelerate and notice of acceleration), all of which are
hereby expressly waived by the Borrower.
25
SECTION 8. MISCELLANEOUS.
Section 8.1 Payment of Expenses, Indemnity, etc. The Borrower shall:
(a) pay all reasonable out-of-pocket costs and expenses of the
Lender in connection with the negotiation, preparation, execution and delivery
of the Loan Documents and the documents and instruments referred to therein
(including without limitation the fees, charges and disbursements of counsel to
the Lender) and any amendment, waiver or consent relating to any of the Loan
Documents, which costs and expenses shall accrue as of the Closing Date but
shall be payable at such time, if any, as the first Loan is made;
(b) pay all reasonable out-of-pocket costs and expenses of the
Lender in connection with the preservation of rights under, and enforcement of,
the Loan Documents and the documents and instruments referred to therein or in
connection with any restructuring or rescheduling of the Obligations (including,
without limitation, the reasonable fees and disbursements of counsel for the
Lender);
(c) pay, and hold the Lender harmless from and against, any
and all present and future stamp, excise and other similar taxes with respect to
the foregoing matters and hold the Lender harmless from and against any and all
liabilities with respect to or resulting from any delay or omission (other than
to the extent attributable to the Lender) to pay such taxes; and
(d) indemnify the Lender, its officers, directors, employees,
representatives and agents (each an "Indemnitee") from, and hold each of them
harmless against, any and all losses, liabilities, claims, damages, expenses,
obligations, penalties, actions, judgments, suits, costs or disbursements of any
kind or nature whatsoever (including, without limitation, the fees and
disbursements of counsel for such Indemnitee in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not such Indemnitee shall be designated a party thereto) that may at
any time (including, without limitation, at any time following the payment of
the Obligations) be imposed on, asserted against or incurred by any Indemnitee
as a result of, or arising out of, or in any way related to or by reason of, any
of the Transactions or the execution, delivery or performance of any Loan
Document.
Section 8.2 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of any Event of
Default the Lender is hereby authorized at any time or from time to time,
without presentment, demand, protest or other notice of any kind to any Loan
Party or any other Person, any such notice being hereby expressly waived, to set
off any other indebtedness or other obligation at any time held or owing by the
Lender to or for the credit or the account of any Loan Party against and on
account of the Obligations of the Loan Parties to the
26
Lender under this Agreement or under any of the other Loan Documents, and all
other claims of any nature or description arising out of or connected with this
Agreement or any other Loan Document, irrespective of whether or not the Lender
shall have made any demand hereunder and although said Obligations, liabilities
or claims, or any of them, shall be contingent or unmatured.
Section 8.3 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed effectively given upon personal delivery
to the party to be notified; on the next Business Day after delivery to a
recognized overnight courier service; upon confirmation of receipt of a
facsimile transmission; or five days after deposit with the United States Post
Office, by registered or certified mail (return receipt requested), postage
prepaid, to the parties at the following addresses (or at such other address for
a party as shall be specified by like notice; provided that notices of a change
of address shall be effective only upon receipt thereof):
If to the Borrower, to:
PLD Telekom Inc.
000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: General Counsel
If to the Lender, to:
Metromedia International Group, Inc.
Xxx Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxxxxxx, X.X. 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
(with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Esq.)
Section 8.4 Successors and Assigns; Assignments.
(a) Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Borrower, the Lender, all future holders of
the Notes and their respective successors and assigns, except that the Borrower
may not
27
assign or transfer any of its rights or obligations under this Agreement without
the prior written consent of the Lender.
(b) Assignments. The Lender may, in accordance with applicable
law, at any time assign to any other Person (each an "Assignee") all or any part
of its rights and obligations under this Agreement, the Notes and any other Loan
Documents. The Borrower and the Lender agree that to the extent of any
assignment, the Assignee shall be deemed to have the same rights and benefits
under the Loan Documents as the Lender hereunder; provided that if the Assignee
is an Affiliate of the Lender, the Borrower shall be entitled to continue to
deal solely and directly with the Lender in connection with the interests so
assigned to the Assignee.
(c) Disclosure of Information. The Borrower authorizes the
Lender to disclose to any Participant or Assignee (each, a "Transferee") and any
prospective Transferee any and all financial and other information in the
Lender's possession concerning the Borrower which has been delivered to the
Lender by the Borrower pursuant to this Agreement or which has been delivered to
the Lender by the Borrower in connection with the Lender's credit evaluation of
the Borrower prior to entering into this Agreement.
Section 8.5 Amendments and Waivers. Neither this Agreement, any other
Loan Document to which the Borrower is a party, nor any terms hereof or thereof
may be amended, supplemented, modified or waived except in accordance with the
provisions of this Section. The Lender and the Borrower may, from time to time,
enter into written amendments, supplements, modifications or waivers for the
purpose of adding, deleting, changing or waiving any provisions to this
Agreement or any Note. Any such amendment, supplement, modification or waiver
shall apply to and shall be binding upon the Borrower, the Lender and all future
holders of such Notes or any portion thereof or participation therein. In the
case of any waiver, the Borrower and the Lender shall be restored to their
former position and rights hereunder and under the outstanding Notes, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing, but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.
Section 8.6 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Lender or any subsequent holder of a Note in exercising any right,
power or privilege hereunder or under any other Loan Document and no course of
dealing between any Loan Party and the Lender or the subsequent holder of any
Note shall operate as a waiver thereof, nor shall any single or partial exercise
of any right, power or privilege hereunder or under any other Loan Document
preclude any other or further exercise thereof of the exercise of any other
right, power or privilege hereunder or thereunder. The rights and remedies
herein expressly provided are cumulative and not exclusive of any rights or
remedies which the Lender or the subsequent holder of any Note would otherwise
have. No notice to or demand on any Loan Party in any case shall entitle any
Loan Party to any other or further notice or demand in similar or other
28
circumstances or constitute a waiver of the rights of the Lender or the
subsequent holder of any Note to any other or further action in any
circumstances without notice or demand.
Section 8.7 Governing Law, Submission to Jurisdiction. (a) THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE
PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW).
(b) Any legal action or proceeding with respect to this
Agreement or any other Loan Document and any action for enforcement of any
judgment in respect thereof may be brought in the courts of the State of New
York or of the United States of America for the District of New York, and, by
execution and delivery of this Agreement, the Borrower hereby accepts for itself
and in respect of its property, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts and appellate courts from any thereof. The
Borrower irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, the Borrower at its
address set forth in Section 8.3. The Borrower hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue of any of
the aforesaid actions or proceedings arising out of or in connection with this
Agreement or any other Loan Document brought in the courts referred to above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum. Nothing herein shall affect the right of the
Lender or any holder of a Note to serve process in any other manner permitted by
law or to commence legal proceedings or otherwise proceed against the Borrower
in any other jurisdiction.
Section 8.8 Counterparts. This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.
Section 8.9 Effectiveness. This Agreement shall become effective on the
date on which the Lender and the Borrower shall have each signed a counterpart
hereof and the Borrower shall have delivered the same to the Lender.
Section 8.10 Headings Descriptive. The headings of the several Sections
and subsections of this Agreement are inserted for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Agreement.
Section 8.11 Marshalling; Recapture. The Lender shall be under no
obligation to xxxxxxxx any assets in favor of any Loan Party or any other party
or against
29
or in payment of any or all of the Obligations. To the extent the Lender
receives any payment by or on behalf of any Loan Party, which payment or any
part thereof is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to such Loan Party or its
estate, trustee, receiver, custodian 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 repayment, the obligation or part thereof which has been paid,
reduced or satisfied by the amount so repaid shall be reinstated by the amount
so repaid and shall be included within the liabilities of such Loan Party to the
Lender as of the date such initial payment, reduction or satisfaction occurred.
Section 8.12 Severability. In case any provision in or obligation under
this Agreement or any Note shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
Jurisdiction, shall not in any way be affected or impaired thereby.
Section 8.13 Survival. All indemnities set forth herein shall survive
the execution and delivery of this Agreement and the Notes and the making and
repayment of the Loans hereunder.
Section 8.14 Limitation of Liability. No claim may be made by any Loan
Party or any other Person against the Lender or any of its Affiliates,
directors, officers, employees, attorneys or agents for any special, indirect,
consequential or punitive damages in respect of any claim for breach of contract
or any other theory of liability arising out of or related to the transactions
contemplated by this Agreement or any act, omission or event occurring in
connection herewith; and each Loan Party hereby waives, releases and agrees not
to xxx upon any claim for any such damages, whether or not accrued and whether
or not known or suspected to exist in its favor.
Section 8.15 Calculations; Computations. The financial statements to be
furnished to the Lender pursuant hereto shall be made and prepared in accordance
with GAAP consistently applied throughout the periods involved and consistent
with GAAP as used in the preparation of the financial statements referred to in
Section 6.1
Section 8.16 Waiver of Trial by Jury. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE BORROWER AND THE LENDER HEREBY IRREVOCABLY WAIVES
ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY MATTER
ARISING HEREUNDER OR THEREUNDER.
Section 8.17 Interest Rate Limitation. Notwithstanding anything herein
to the contrary, if at any time the Interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the
30
"Maximum Rate") which may be contracted for, charged, taken, received or
reserved by the Lender holding such Loan in accordance with applicable law, the
rate of interest payable in respect of such Loan hereunder, together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and, to
the extent lawful, the Interest and Charges that would have been payable in
respect of such Loan but were not payable as a result of the operation of this
Section 8.17 shall be cumulated and the Interest and Charges payable to such
Lender in respect of other Loans or periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount shall have been received
by Lender.
31
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
PLD TELEKOM INC.
By: /s/ Xxxxx X.X. Xxxx
-------------------
Name: Xxxxx X.X. Xxxx
Title: Chairman, President and Chief
Executive Officer
METROMEDIA INTERNATIONAL GROUP, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------
Name: Xxxxxx Xxxxxx
Title: Chief Financial Officer,
Executive Vice President,
Treasurer and Director
PLD TELEKOM INC.
SCHEDULES TO
BRIDGE LOAN AGREEMENT, DATED AS OF MAY 18, 1999
BETWEEN PLD TELEKOM INC. AND
METROMEDIA INTERNATIONAL GROUP, INC.
SCHEDULE 2.1 PLD TELEKOM, INC. MAY REQUEST LOANS IN THE FOLLOWING AGGREGATE
AMOUNTS DURING THE FOLLOWING MONTHS:
DATE LOAN
---- ----
MAY, 1999 $1,000,000
JUNE, 1999 2,000,000
JULY, 1999 1,000,000
AUGUST, 1999 1,000,000
SEPTEMBER, 1999 1,000,000
OCTOBER, 1999 1,000,000
----------
TOTAL $7,000,000
TO THE EXTENT PLD TELEKOM INC. BORROWS LESS THAN THE AMOUNT AVAILABLE FOR ANY
MONTH SPECIFIED ABOVE (EACH, A "SHORTFALL"), PLD TELEKOM INC. MAY BORROW THE
AGGREGATE AMOUNT OF ALL SUCH SHORTFALLS IN ANY SUCCEEDING MONTH PRIOR TO THE
FINAL MATURITY DATE, UP TO A MAXIMUM AMOUNT OF $7,000,000.
SCHEDULE 2.2 USE OF PROCEEDS: SEE ATTACHED ANNEX A
SCHEDULE 4.1 JURISDICTION IN WHICH PLD TELEKOM INC. IS QUALIFIED TO DO BUSINESS
AS A FOREIGN CORPORATION:
State of New York.
SCHEDULE 4.2 CAPITALIZATION OF PLD TELEKOM INC.:
37,846,789 shares of Common Stock of PLD Telekom Inc. (the "Company")
are issued and outstanding as of the date of the Agreement.
Schedule of outstanding warrants and options to purchase shares of the
Company's Common Stock as of the date of the Agreement is attached.
In addition, the terms of the Company's 12% Series A and Series B
Revolving Credit Notes due 1998 provide for the issuance, in certain
specified circumstances, of additional and/or default warrants, all as
more fully described in the Company's Annual Report on Form 10-K/A for
the fiscal year ended December 31, 1998 ("1998 10-K") and its Quarterly
Report on Form 10-Q for the quarter ended March 31, 1999.
In connection with the acquisition of additional interests in Technocom
Limited in November 1997, the Company entered into revised put and call
agreements with the minority shareholders of Technocom (Elite
International Limited and Plicom Limited) regarding put and call option
arrangements for their remaining minority stakes. Pursuant to the terms
of such agreements, which are fully described in the Company's Annual
Report on Form 10-K/A for the fiscal year ended December 31, 1998, the
Company may be required to issue additional shares of Common Stock, in
addition to the payment of cash, in respect of such arrangements.
Pursuant to a Revolving Credit Agreement with News America Incorporated
("News America"), News America has the right to convert loans made to
the Company into shares of Common Stock, on a basis more fully described
in the Company's Annual Report on Form 10-K/A for the fiscal year ended
December 31, 1998.
Consents to the borrowings and any pledge will be required from:
(a) the holders of the Senior and Convertible Notes, (b) the Travelers
Parties, (c) News America, and (d) Plicom Limited and Elite
International Limited.
SCHEDULE 4.4 CONSENTS AND APPROVALS:
The terms of the Bridge Loan Agreement and the notes issued thereunder
will be described in the Company's periodic filings under the Securities
Exchange Act of 1934, as amended.
SCHEDULE 4.7 UNDISCLOSED LIABILITIES:
None.
SCHEDULE 4.8 ABSENCE OF CERTAIN CHANGES OR EVENTS:
None.
2
SCHEDULE 4.9 LEGAL PROCEEDINGS, ETC.:
None.
SCHEDULE 4.10 PERMITS:
None.
3
EXHIBIT A
PLD TELEKOM INC.
PROMISSORY NOTE
$7,000,000 New York, New York
May 18, 1999
FOR VALUE RECEIVED, the undersigned, PLD TELEKOM INC., a Delaware
corporation (the "Borrower"), hereby unconditionally promises to pay to
METROMEDIA INTERNATIONAL GROUP, INC., or registered assigns (the "Lender"), on
the Final Maturity Date (as defined in Credit Agreement referred to below), in
lawful money of the United States of America and in immediately available funds,
the principal amount of $7,000,000 or, if less, the aggregate amount outstanding
of the Loans (as defined in the Credit Agreement referred to below). The
Borrower hereby unconditionally further agrees to pay interest in like money on
the unpaid principal amount hereof from time to time from the date hereof at the
rates and on the dates specified in Section 2.5 of the Bridge Loan Agreement
dated as of May 18, 1999 between the Borrower and the Lender (as amended,
modified or supplemented from time to time, the "Credit Agreement").
This Note is one of the Notes referred to in Section 2.4 of the Credit Agreement
and is entitled to the benefits thereof. All of the terms, conditions, and
covenants of the Credit Agreement are expressly made a part of this Note by
reference in the same manner and with the same effect as if set forth herein.
This Note is a registered Note and, as provided in the Credit Agreement upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for like principal amount will be issued to and registered in the name of, the
transferee. Prior to due presentment for registration of transfer, the Borrower
may treat the person in whose name this Note is registered as the owner hereof
for the purpose of receiving payment and for all other purposes, and the
Borrower will not be affected by any notice to the contrary. Any transferee of
this Note, by its acceptance hereof, agrees to be bound by all the terms,
conditions and covenants of the Credit Agreement applicable to the holder of a
Note.
The principal amount of this Note, together with all accrued and unpaid interest
thereon, is convertible into Common Stock of the Borrower at any time and from
time to time, as, and subject to the conditions and limitations, specified in
the Credit Agreement.
As provided in the Credit Agreement, the Loans evidenced by this Note are
subject to optional and mandatory repayments, in whole and in part, all as
specified in the Credit Agreement.
If an Event of Default, as defined in the Credit Agreement, occurs and is
continuing, all amounts remaining unpaid on this Note shall become, or may be
declared to be, immediately due and payable, all as provided therein.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES
THEREOF RELATING TO CONFLICTS OF LAW).
PLD TELEKOM INC.
By: _______________________
Name:
Title:
2
Schedule of Principal Advances and Repayments
Amount of Amount of Amount of
Principal Interest Principal
Date Advance Payment Repayment
-------------- --------- --------- ---------
3
