--------------------------------------------------------------------------------
$750,000,000
TERM LOAN AGREEMENT
dated as of
August 30, 2002
among
Qwest Services Corporation
Qwest Dex Holdings, Inc.
Qwest Dex, Inc.
The Lenders Listed Herein
and
Bank of America, N.A.,
as Agent
--------------------------------------------------------------------------------
Banc of America Securities LLC
Sole Lead Arranger and Bookrunner
TABLE OF CONTENTS
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PAGE
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ARTICLE 1
DEFINITIONS
Section 1.01. The Definitions.................................................1
Section 1.02. Accounting Terms and Determinations............................18
Section 1.03. Types of Borrowings............................................19
ARTICLE 2
THE CREDITS
Section 2.01. Commitments to Lend............................................19
Section 2.02. Notice of Borrowing............................................19
Section 2.03. [Intentionally Deleted]........................................20
Section 2.04. Notice to Lenders; Funding of Loans............................20
Section 2.05. Notes; Evidence of Loans.......................................21
Section 2.06. Maturity of Loans..............................................22
Section 2.07. Interest Rates.................................................22
Section 2.08. [Intentionally Deleted]........................................24
Section 2.09. Termination of Commitments.....................................24
Section 2.10. Method of Electing Interest Rates with Respect to Tranche A
Loans..........................................................24
Section 2.11. Prepayments....................................................26
Section 2.12. General Provisions as to Payments..............................27
Section 2.13. Funding Losses.................................................27
Section 2.14. Computation of Interest........................................28
Section 2.15. Notice of Prepayment Events....................................28
ARTICLE 3
CONDITIONS
Section 3.01. Closing........................................................28
Section 3.02. The Borrowing Date.............................................29
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.01. Corporate Existence and Power..................................30
Section 4.02. Corporate and Governmental Authorization; No
Contravention..................................................30
i
Section 4.03. Binding Effect.................................................31
Section 4.04. Financial Information..........................................31
Section 4.05. Litigation.....................................................31
Section 4.06. Compliance with ERISA..........................................32
Section 4.07. Environmental Matters..........................................32
Section 4.08. Taxes..........................................................33
Section 4.09. Subsidiaries...................................................33
Section 4.10. Not an Investment Company......................................33
Section 4.11. Full Disclosure................................................33
Section 4.12. Solvency.......................................................33
ARTICLE 5
COVENANTS
Section 5.01. Information....................................................34
Section 5.02. Maintenance of Property; Insurance.............................36
Section 5.03. Maintenance of Existence.......................................37
Section 5.04. Compliance with Laws...........................................37
Section 5.05. Inspection of Property, Books and Records......................37
Section 5.06. Financial Covenants............................................37
Section 5.07. Negative Pledge................................................38
Section 5.08. Consolidations, Mergers and Sales of Assets....................39
Section 5.09. Use Of Proceeds................................................39
Section 5.10. Restricted Payments............................................39
Section 5.11. Transactions With Affiliates...................................40
Section 5.12. Limitations on Debt............................................40
Section 5.13. Limitations on Investments; Loans, Advances, Guarantees and
Acquisitions...................................................41
Section 5.14. Further Assurances Regarding Collateral and Guaranty
Requirement....................................................41
Section 5.15. QSC Bank Facility Covenants....................................42
ARTICLE 6
DEFAULTS
Section 6.01. Events of Default..............................................42
Section 6.02. Notice of Default..............................................44
ARTICLE 7
THE AGENT
Section 7.01. Appointment and Authorization..................................45
Section 7.02. Agent and Affiliates...........................................45
Section 7.03. Action by Agent................................................45
Section 7.04. Consultation with Experts......................................45
Section 7.05. Delegation of Duties...........................................46
Section 7.06. Liability of Agent.............................................46
ii
Section 7.07. Indemnification................................................46
Section 7.08. Credit Decision; Disclosure of Information by Agent............46
Section 7.09. Successor Agent................................................47
Section 7.10. Agent's Fee....................................................47
ARTICLE 8
CHANGES IN CIRCUMSTANCES
Section 8.01. Basis for Determining Interest Rate Inadequate or Unfair.......48
Section 8.02. Illegality.....................................................48
Section 8.03. Increased Cost and Reduced Return..............................49
Section 8.04. Taxes..........................................................50
Section 8.05. Domestic Loans Substituted for Affected Euro-Dollar Loans......52
Section 8.06. Substitution of Lender.........................................52
ARTICLE 9
GUARANTEES
Section 9.01. The Guaranty...................................................53
Section 9.02. Guaranty Unconditional.........................................53
Section 9.03. Discharge Only upon Payment in Full; Reinstatement in
Certain Circumstances..........................................54
Section 9.04. Waiver by Guarantors...........................................54
Section 9.05. Subrogation....................................................54
Section 9.06. Stay of Acceleration...........................................54
ARTICLE 10
MISCELLANEOUS
Section 10.01. Notices........................................................54
Section 10.02. No Waivers.....................................................55
Section 10.03. Expenses; Indemnification......................................55
Section 10.04. Sharing of Set-offs............................................56
Section 10.05. Amendments and Waivers; Release of Liens.......................56
Section 10.06. Successors and Assigns.........................................57
Section 10.07. Governing Law; Submission to Jurisdiction......................59
Section 10.08. Counterparts; Integration; Effectiveness.......................59
Section 10.09. WAIVER OF JURY TRIAL...........................................59
Section 10.10. Confidentiality................................................59
Section 10.11. No Reliance on Margin Stock....................................60
Commitment Schedule
Schedule 4.04(a) - Supplemental Information
Schedule 4.05 - Litigation
iii
Schedule 4.07 - Environmental Matters
Schedule 5.07 - Existing Liens
Schedule 5.12 - Existing Debt
Schedule 5.13 - Existing Investments
Exhibit A - Note
Exhibit B - Security and Pledge Agreement
Exhibit X-0, X-0, X-0 xxx X-0 - Xxxxxxxx of Counsel for the Loan Parties
Exhibit D - Assignment and Assumption Agreement
Exhibit E - Notice of Borrowing
Exhibit F - Use of Proceeds Certificate
iv
TERM LOAN AGREEMENT
AGREEMENT dated as of August 30, 2002, among QWEST SERVICES
CORPORATION, QWEST DEX HOLDINGS, INC., QWEST DEX, INC., the LENDERS listed on
the signature pages hereof, and BANK OF AMERICA, N.A., as Agent.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.01. The Definitions.
The following terms, as used herein, have the following meanings:
"Additional Permitted Secured Obligations" has the meaning set forth in
the Security and Pledge Agreement.
"Adjusted London Interbank Offered Rate" has the meaning set forth in
Section 2.07.
"Administrative Questionnaire" means, with respect to each Lender, an
administrative questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Borrower) duly completed by such Lender.
"Affiliate", as applied to any Person, means any other Person directly
or indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.
"Agent" means Bank of America, N.A., in its capacities as
administrative agent and collateral agent for the Lenders under the Loan
Documents, and its successors in such capacities.
"Agent-Related Person" has the meaning set forth in Section 7.08.
"Agreement" means this Term Loan Agreement dated as of August 30, 2002,
as the same may from time to time be amended, amended and restated, modified or
supplemented.
"Applicable Lending Office" means, with respect to any Lender, (i) in
the case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of
its
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Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case of its
Tranche B Loans, its Tranche B Lending Office.
"Asset Sale" means, with respect to any Person, any sale, transfer or
other disposition (including pursuant to a sale and leaseback transaction) of
any property of such Person, except (i) sales of inventory, customer premises
equipment and other equipment, conduit, fiber and capacity (including
indefeasible rights of use), Permitted Investments and sales or licenses of
technology, in each case in the ordinary course of business, (ii) write-offs of
accounts receivable or settlements of accounts receivable for less than the
total unpaid balance thereof, in each case in the ordinary course of business
and consistent with such Person's historical collection practices, and (iii)
Excluded Asset Transfers. Nothing contained in this definition shall be
construed to limit or modify any restriction contained in Section 5.08(b) or
5.08(c).
"Assignee" has the meaning set forth in Section 10.06(c).
"Base Rate" means, for any day, a rate per annum equal to the higher of
(i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal
Funds Rate for such day.
"Base Rate Margin" has the meaning set forth in Section 2.07(a).
"Benefit Arrangement" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any member of the ERISA
Group.
"Borrower" means Qwest Dex, Inc., a Colorado corporation, and its
successors.
"Borrowing" has the meaning set forth in Section 1.03.
"Borrowing Date" means the date on which the Loans are to be made.
"Capital Expenditures" means, for any period, the sum (without
duplication) of (a) the additions to property, plant and equipment and other
capital expenditures of Holdings and its Subsidiaries that are (or would be) set
forth in a consolidated statement of cash flows of Holdings and its Subsidiaries
for such period and (b) any capital lease obligations incurred by Holdings and
its Subsidiaries during such period.
"Capital Funding" means Qwest Capital Funding, Inc., a Colorado
corporation, and its successors.
"Change of Control" shall occur if (i) any person or group of persons
(within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended), other than Xxxxxx X. Xxxxxxxx, Xxxxxxxx Company or any of their
2
affiliates, obtain ownership or control (whether in one transaction or one or
more series of transactions) of more than 50% of the outstanding shares of
common stock of QCII or of the shares of QCII entitled to vote on the election
of members of the board of directors of QCII, (ii) Holdings shall cease to be a
direct or indirect wholly-owned Subsidiary of QCII, (iii) the Borrower shall
cease to be a wholly-owned Subsidiary of Holdings or (iv) QSC shall cease to be
a direct or indirect Subsidiary of QCII.
"Class", when used in respect of any Loan, Borrowing or Commitment,
refers to whether such Loan, or the Loans comprising such Borrowing, or the
Loans to be made pursuant to such Commitment, are Tranche A Loans or Tranche B
Loans.
"Closing Date" means the date on which the Agent shall have received
the documents or evidence specified in or pursuant to Section 3.01.
"Collateral" means any and all "Collateral", as defined in any
Collateral Document.
"Collateral Agent" has the meaning set forth in the Security and Pledge
Agreement.
"Collateral and Guaranty Requirement" means the requirement that:
(a) the Collateral Agent shall have received from each
Lien Grantor either (i) a counterpart of the Security and Pledge
Agreement duly executed and delivered on behalf of such Lien Grantor or
(ii) in the case of any Person that becomes a Lien Grantor after the
Closing Date, a supplement to the Security and Pledge Agreement, in the
form specified therein, duly executed and delivered on behalf of such
Lien Grantor;
(b) all outstanding Equity Interests constituting
Collateral shall have been pledged pursuant to the Security and Pledge
Agreement and the Collateral Agent shall have received all certificates
or other instruments representing all outstanding Equity Interests of
Corp., all outstanding Equity Interests of QwestDex and all outstanding
Equity Interests of QwestDex, Inc., in each case together with stock
powers or other instruments of transfer with respect thereto endorsed
in blank;
(c) all Instruments constituting Collateral shall have
been pledged pursuant to the Security and Pledge Agreement and the
Collateral Agent shall have received all such Instruments (subject to
any limitations set forth in the Security and Pledge Agreement),
together with instruments of transfer with respect thereto endorsed in
blank;
(d) all documents and instruments, including Uniform
Commercial Code financing statements, required by law or reasonably
3
requested by the Collateral Agent to be filed, registered or recorded
to create the Liens intended to be created by the Security and Pledge
Agreement and perfect or record such Liens to the extent, and with the
priority, required by the Security and Pledge Agreement, shall have
been filed, registered or recorded or delivered to the Collateral Agent
for filing, registration or recording; and
(e) each Lien Grantor shall have obtained all consents
and approvals required to be obtained by it in connection with (i) the
execution and delivery of the Security and Pledge Agreement and (ii)
subject to any limitations set forth in the Security and Pledge
Agreement, the performance of its obligations thereunder and the
granting of the Liens purported to be granted by it thereunder.
"Collateral Documents" means the Security and Pledge Agreement and each
other security agreement, pledge agreement, instrument or document executed and
delivered pursuant to Section 5.14 to secure any of the Secured Obligations.
"Commitment" means a Tranche A Commitment or Tranche B Commitment, or
any combination thereof (as the context requires).
"Consolidated Adjusted Interest Expense" means, for any period,
Consolidated Interest Expense minus any portion thereof attributable to
Intercompany Debt.
"Consolidated EBITDA" means, for any period, the net income of Holdings
and its Consolidated Subsidiaries determined on a consolidated basis for such
period (adjusted to exclude the effect of (w) any non-cash losses as a result of
impairment of goodwill as required by Statement of Financial Accounting
Standards No. 142, (x) equity gains or losses in unconsolidated Persons, (y) any
preferred dividend income and any extraordinary or other non-recurring or
non-operating gain or non-recurring or non-operating loss or (z) any gain or
loss on the disposition of investments), plus, to the extent deducted in
determining such adjusted net income, (i) Consolidated Interest Expense, (ii)
income tax expense and (iii) depreciation, amortization, reserves and other
non-cash charges and (iv) transaction costs incurred with this Agreement and
minus, to the extent included in determining such adjusted net income, the
aggregate amount of (i) interest income and (ii) income tax benefit.
"Consolidated Interest Expense" means, for any period, for Holdings and
its Consolidated Subsidiaries on a consolidated basis, (a) all cash interest
expense in connection with borrowed money (including capitalized interest
payable currently in cash) or in connection with the deferred purchase price of
assets, and (b) the portion of cash rent expense of Holdings and its
Consolidated Subsidiaries with respect to such period under capital leases that
is treated as interest.
4
"Consolidated Net Worth" means, at any date, the consolidated
stockholders equity of Holdings and its Consolidated Subsidiaries at such date,
without giving effect to any non-cash losses as a result of impairment of
goodwill as required by Statement of Financial Accounting Standards No. 142.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which would be consolidated with those of QCII, QSC,
Holdings or the Borrower, as applicable, in its consolidated financial
statements if such statements were prepared as of such date.
"Consolidated Working Capital Adjustment" means, for any period, on a
consolidated basis, the amount (which may be a negative number) by which Net
Working Capital as of the beginning of such period exceeds (or is less than) Net
Working Capital as of the end of such period.
"Contingent Prepayment Amount" means, with respect to any Contingent
Prepayment Date, the largest multiple of $1,000,000 which is no greater than the
amount by which Dex Cash exceeded $15,000,000 at 5:00 PM (Denver time) on the
preceding Friday. To the extent a Contingent Payment Amount would otherwise
include the Net Proceeds of any Prepayment Event (as defined herein or in the
QSC Bank Facility), appropriate adjustments shall be made to exclude such Net
Proceeds.
"Contingent Prepayment Date" means the second Domestic Business Day
following each Friday of each calendar week.
"Corp." means Qwest Corporation, a Colorado corporation, and its
successors.
"Corp. Company" means Corp. or any of its Subsidiaries.
"Corp. Equity Collateral" has the meaning set forth in the Security and
Pledge Agreement.
"Credit Exposure" means, with respect to any Lender, the amount of its
Commitment, if still in existence, or the aggregate unpaid principal amount of
its Loans, if the Commitments shall have, or shall have been, terminated.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (v) all Debt secured
by a Lien on any asset of such Person, whether or not such Debt is otherwise an
obligation of such Person, and (vi) all Debt of others Guaranteed by such
Person.
5
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Dex Cash" means, at any date, the consolidated cash and cash
equivalents of Holdings and its Consolidated Subsidiaries at such date.
"Dex Purchaser Secured Obligations" has the meaning set forth in the
Security and Pledge Agreement.
"Dexter Assets" means any assets of any QwestDex Company other than
Xxxxxx Assets.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York City, New York or Charlotte,
North Carolina are authorized by law to close.
"Domestic Lending Office" means, as to each Lender, its office located
at its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Lender may hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Agent.
"Domestic Loan" means (i) a Tranche A Loan which bears interest at the
Base Rate pursuant to the Notice of Borrowing or the applicable Notice of
Interest Rate Election or the provisions of Article 8 or (ii) an overdue amount
which was a Domestic Loan immediately before it became overdue.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
the environment, the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
wastes into the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, Hazardous Substances or wastes or the
clean-up or other remediation thereof.
"Equity Interests" means (i) shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person or (ii) any
warrants, options or other rights to acquire such shares or interests.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
6
"ERISA Group" means QCII, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with QCII or any Subsidiary,
are treated as a single employer under Section 414 of the Internal Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Lender, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Lender as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Borrower and the Agent.
"Euro-Dollar Loan" means (i) a Tranche A Loan which bears interest at a
Euro-Dollar Rate pursuant to the Notice of Borrowing or the applicable Notice of
Interest Rate Election or (ii) an overdue amount which was a Euro-Dollar Loan
before it became overdue.
"Euro-Dollar Margin" has the meaning set forth in Section 2.07(c).
"Euro-Dollar Rate" means a rate of interest determined pursuant to
Section 2.07 on the basis of an Adjusted London Interbank Offered Rate.
"Euro-Dollar Reserve Percentage" has the meaning set forth in Section
2.07.
"Event of Default" has the meaning set forth in Section 6.01.
"Excess Cash Flow" means, for any fiscal period, (i) Consolidated
EBITDA for such fiscal period plus (ii) to the extent deducted from such
Consolidated EBITDA, (x) interest income and (y) cash income tax benefit plus
(iii) to the extent excluded from such Consolidated EBITDA, non-recurring or
non-operating cash gains (except to the extent attributable to a QwestDex
Qualifying Asset Sale or a Qualifying Dexter Asset Sale), plus (iv) the
Consolidated Working Capital Adjustment for such period minus (v) to the extent
excluded from such Consolidated EBITDA, non-recurring or non-operating cash
losses minus (vi) Consolidated Adjusted Interest Expense for such fiscal period
minus (vii) Capital Expenditures (except to the extent attributable to the
incurrence of long-term Debt) for such fiscal period minus (viii) the current
portion of income tax expense for such period, provided that at any time a
Trigger Event exists, the amount deducted pursuant to this clause (viii) shall
not exceed the actual amount of income taxes payable currently by or on behalf
of the QwestDex Companies, after giving effect to any credits, loss
carryforwards or
7
other tax attributes of QCII and its Subsidiaries available to reduce such
current payment obligation ("Permitted Tax Payments") minus (ix) the portion of
rentals under capital leases allocable to principal and minus (x) the amount of
any optional prepayments of the Loans or mandatory prepayments of the Loans
pursuant to Section 2.11(d) during such period. To the extent Excess Cash Flow
for any period would otherwise include the Net Proceeds of any Prepayment Event
(as defined herein or in the QSC Bank Facility), appropriate adjustments shall
be made to exclude such Net Proceeds.
"Excluded Asset Transfer" means (i) a sale or disposition of shares of
Equity Interests in a Subsidiary of Holdings in order to qualify members of the
governing body of such Subsidiary, if required by applicable law, and in such
amounts as required by applicable law, (ii) the formation of, and transfer of
assets to, newly formed, wholly-owned Subsidiaries of the Borrower contemplated
by the QwestDex Purchase Agreements substantially simultaneously with the
consummation of the respective Asset Sales contemplated thereby, (iii) in the
event that the respective sales of the Dexter Assets and the Xxxxxx Assets
pursuant to the QwestDex Purchase Agreements are not consummated, any similar
transfer of assets to one or more wholly-owned Subsidiaries of the Borrower
required in connection with, and effected substantially simultaneously with the
consummation of, an Asset Sale of the Dexter Assets or the Xxxxxx Assets, as the
case may be, permitted by Section 5.08(b), and (iv) any transfer of assets
pursuant to any merger or consolidation permitted by Section 5.08(a).
"Facility Liens" has the meaning set forth in Section 5.07(e).
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if such day is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to Bank of America, N.A., on such day on
such transactions as determined by the Agent.
"Fixed Rate" has the meaning set forth in Section 2.07(c).
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
8
"Group of Loans" means at any time a group of Loans consisting of (a)
all Tranche A Loans outstanding at such time which are (i) Domestic Loans at
such time or (ii) Euro-Dollar Loans having the same Interest Period at such
time; provided that, if a Loan of any particular Lender is converted to or made
as a Domestic Loan pursuant to Section 8.02 or 8.05, such Loan shall be included
in the same Group or Groups of Loans from time to time as it would have been in
if it had not been so converted or made or (b) all Tranche B Loans outstanding
at such time.
"Guaranteed Obligations" means, with respect to each Guarantor, all
advances to, and debts, liabilities (including without limitation the Loans),
obligations, covenants and duties of, the Borrower, arising under any Loan
Document, whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising
and including interest and fees that accrue after, or would accrue but for, the
commencement of an insolvency proceeding, whether or not allowed or allowable in
such proceeding.
"Guarantor" means each of QSC and Holdings.
"Guaranty" by any Person means any obligation, contingent or otherwise,
of such Person directly or indirectly guaranteeing any Debt or other obligation
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership arrangements,
by agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or (ii)
entered into for the purpose of assuring in any other manner the obligee of such
Debt or other obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part), provided that the term
Guaranty shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives, by-products
and other hydrocarbons, or any substance having any constituent elements
displaying any of the foregoing characteristics.
"Holdings" means Qwest Dex Holdings, Inc., a Delaware corporation, and
its successors.
"Indemnitee" has the meaning set forth in Section 10.03(b).
"Instruments" has the meaning set forth in the Security and Pledge
Agreement.
9
"Insured Judgment Amounts" means that part, if any, of any and all
judgments rendered against any Loan Party and/or any of its Subsidiaries that
are covered by insurance issued by a financially responsible insurer(s) who has
not disputed coverage.
"Intercompany Debt" means Debt of a QwestDex Company owing to QCII or
any of its Subsidiaries.
"Interest Period" means, with respect to each Euro-Dollar Loan, a
period commencing on the date of borrowing specified in the Notice of Borrowing
or the date specified in the applicable Notice of Interest Rate Election and
ending one, two, three or six months thereafter, as the Borrower may elect in
the applicable notice; provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Euro-Dollar Business Day shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar
Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Euro-Dollar Business
Day;
(b) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall, subject to clause (c) below, end on
the last Euro-Dollar Business Day of a calendar month; and
(c) no Interest Period may end after the Termination
Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"Lender" means each Person listed as a "Lender" on the signature pages
hereof, each Assignee which becomes an Lender pursuant to Section 10.06(c), and
their respective successors.
"Lender Affiliate" means, (a) with respect to any Lender, (i) an
Affiliate of such Lender or (ii) an entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is administered or managed by a Lender or an Affiliate of
such Lender and (b) with respect to any Lender that is a fund or managed account
which invests in bank loans and similar extensions of credit, any other fund or
managed account that invests in bank loans and similar extensions of credit and
is managed by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.
10
"Leverage Trigger Event" means a Senior Debt Ratio exceeding, at the
last day of any fiscal quarter, (i) 1.0 to 1.0 if such date is prior to the date
of consummation of a Qualifying Dexter Asset Sale and (ii) 1.5 to 1.0 if such
date is on or after the date of consummation of a Qualifying Dexter Asset Sale.
A Leverage Trigger Event will cease to be continuing on the first to occur of
(x) the date of delivery of financial statements pursuant to Section 5.01
showing no Trigger Event existed at the date thereof and (y) the date on which,
after subtracting the amount of prepayments of Loans since the date of the most
recent financial statements delivered pursuant to Section 5.01 from Senior Debt
as reflected in such financial statements, no Trigger Event would have existed
as at the date thereof.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
preferential arrangement that has the practical effect of creating a security
interest, in respect of such asset. For the purposes of this Agreement, QSC or
any Subsidiary shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to such asset.
"Lien Grantor" has the meaning set forth in the Security and Pledge
Agreement.
"Loan" means a Tranche A Loan or Tranche B Loan, or any combination
thereof (as the context requires).
"Loan Documents" means this Agreement, the Notes, and the Collateral
Documents.
"Loan Party" means each of QSC, Holdings and the Borrower.
"London Interbank Offered Rate" has the meaning set forth in Section
2.07.
"Margin Stock" means "margin stock" as such term is defined in
Regulation U of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"Material Debt" means Debt (other than the Loans) of QSC and/or one or
more of its Subsidiaries, arising in one or more related or unrelated
transactions, in an aggregate principal amount exceeding $100,000,000.
"Material Plan" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $100,000,000.
11
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.
"Net Proceeds" means, with respect to any event, the cash proceeds
received in respect of such event including, without limitation, any cash
received in respect of any non-cash proceeds, but only as and when received, in
each case net of the sum of (1) all reasonable fees and out-of-pocket costs and
expenses paid (or reasonably estimated to be payable) by a Prepayment Party to
third parties (other than Affiliates) in connection with such event, (2) in the
case of a sale, transfer or other disposition of an asset (including, without
limitation, pursuant to a sale and leaseback transaction), the amount of all
payments required to be made by a Prepayment Party as a result of such event to
repay Debt secured by such asset (but excluding (x) Loans and (y) any Debt
secured by such asset if such Debt or the Lien securing such Debt is
subordinated (or is required to be subordinated) to the Loans), and (3) the
amount of all taxes paid (or reasonably estimated to be payable) by a Prepayment
Party, the amount of any reserves established by a Prepayment Party to fund
contingent liabilities reasonably estimated to be payable (until such time as
such amounts are no longer reserved or such reserves are no longer necessary, at
which time any remaining amounts will become Net Proceeds) and the amount of
capital and operating expenditures that would not otherwise have been incurred
and are required in writing or by application of policy by a public utility
commission to be incurred as a condition to its consent, in each case during the
year that such event occurred or the next succeeding year and that are directly
attributable to such event (as determined reasonably and in good faith by the
chief financial officer of the Borrower); provided that "Net Proceeds" shall not
include any cash payment received by a Prepayment Party and constituting a
deposit or advance with respect to an Asset Sale that has not been consummated
on or prior to the date of receipt thereof (it being understood that upon
consummation of such Asset Sale such cash payment shall constitute "Net
Proceeds" with respect thereto).
"Net Working Capital" means, at any date, (a) the consolidated current
assets of Holdings and its Consolidated Subsidiaries as of such date (excluding
cash and Permitted Investments) minus (b) the consolidated current liabilities
of Holdings and its Consolidated Subsidiaries as of such date (excluding current
liabilities in respect of Debt). Net Working Capital at any date may be a
positive or negative number. Net Working Capital increases when it becomes more
positive or less negative and decreases when it becomes less positive or more
negative.
"Notes" means promissory notes of the Borrower, substantially in the
form of Exhibit A hereto, evidencing the obligation of the Borrower to repay the
12
Loans made to it, and "Note" means any one of such promissory notes issued
hereunder.
"Notice of Borrowing" has the meaning set forth in Section 2.02.
"Parent" means, with respect to any Lender, any Person controlling such
Lender.
"Participant" has the meaning set forth in Section 10.06(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Permitted Investments" means investments in:
(a) direct obligations of, or obligations the principal
of and interest on which are unconditionally guaranteed by, the United
States (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States), in each case
maturing within one year from the date of acquisition thereof;
(b) commercial paper maturing within one year from the
date of acquisition thereof and having, at such date of acquisition,
the highest credit rating obtainable from Standard & Poor's or from
Xxxxx'x Investors Service, Inc.;
(c) certificates of deposit, banker's acceptances and
time deposits maturing within one year from the date of acquisition
thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any
commercial bank organized under the laws of the United States or any
State thereof which has a combined capital and surplus and undivided
profits of at least $500,000,000;
(d) fully collateralized repurchase agreements with a
term of not more than 30 days for securities described in clause (a)
above and entered into with a financial institution satisfying the
criteria described in clause (c) above; and
(e) any other Investments made in compliance with the
Cash Management Investment Policy of the cash management group of QSC
with respect to cash investments, substantially as in effect on the
Closing Date.
"Permitted Tax Payments" is defined in the definition of Excess Cash
Flow.
13
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"Prepayment Event" means (i) any QwestDex Qualifying Asset Sale and
(ii) any sale, transfer or other disposition of the capital stock of Corp. which
constitutes a Prepayment Event under the QSC Bank Facility (as in effect on the
date hereof).
"Prepayment Event Notice" means any notice delivered by the Borrower
pursuant to Section 2.15.
"Prepayment Party" means the Borrower or QSC (solely with respect to
the sale of the capital stock of Corp.).
"Prime Rate" means the rate of interest publicly announced by Bank of
America, N.A., from time to time as its Prime Rate.
"Purchase Money Debt" means Debt of any Person incurred for the purpose
of financing all or any part of the cost of the acquisition of any asset by such
Person, so long as the proceeds of any such Debt are applied by such Person upon
receipt thereof (and in any event within ten (10) Domestic Business Days after
receipt thereof) to acquire such asset.
"Purchase Money Obligor" has the meaning set forth in Section 5.07(b).
"QCII" means Qwest Communications International Inc., a Delaware
corporation, and its successors.
"QCII Indentures" means the Indenture dated as of November 27, 1998
between QCII and Bankers Trust Company, as Trustee, the Indenture dated as of
November 4, 1998 between QCII and Bankers Trust Company, as Trustee, the
Indenture dated as of August 28, 1997 between QCII and Bankers Trust Company, as
Trustee, as supplemented by First Supplemental Indenture dated as of February
16, 2001, the Indenture dated as of October 15, 1997 between QCII and Bankers
Trust Company, as Trustee, as supplemented by First Supplemental Indenture dated
as of February 16, 2001, and the Indenture dated as of January 29,
14
1998 between QCII and Bankers Trust Company, as Trustee, as supplemented by
First Supplemental Indenture dated as of February 16, 2001.
"QSC" means Qwest Services Corporation, a Colorado corporation, and its
successors.
"QSC Asset Collateral" has the meaning set forth in the Security and
Pledge Agreement.
"QSC Bank Facility" means the QSC Existing Bank Facility as
restructured and assumed pursuant to the amendment and restatement referred to
in Section 3.01(d), and as further amended from time to time.
"QSC Existing Bank Facility" means the 364-Day Credit Agreement dated
as of May 4, 2001 and amended and restated as of March 12, 2002 among Qwest
Capital Funding, Inc., Corp. and QCII, the banks listed therein and Bank of
America, N.A., as administrative agent, as in effect immediately prior to the
Closing Date.
"Qualifying Dexter Asset Sale" means any Asset Sale by a QwestDex
Company to the extent that the assets transferred pursuant thereto consist
solely of Dexter Assets.
"Qwest Entity" has the meaning set forth in Section 7.02.
"QwestDex Asset Collateral" has the meaning set forth in the Security
and Pledge Agreement.
"QwestDex Company" means Holdings or any of its Subsidiaries.
"QwestDex Dexter Purchase Agreement" means the Purchase Agreement dated
August 19, 2002 between QCII, QSC, the Borrower and the QwestDex Purchaser with
respect to the Dexter Assets, as amended, amended and restated, modified or
supplemented from time to time.
"QwestDex Holdings Intercompany Note" means the Loan Agreement dated
January 15, 2002 governing borrowings by Holdings from Capital Funding and the
Debt outstanding thereunder.
"QwestDex Inc. Intercompany Note" means the Loan Agreement dated
January 15, 2002 governing borrowings by the Borrower from Capital Funding and
the Debt outstanding thereunder.
"QwestDex Purchase Agreements" means the QwestDex Dexter Purchase
Agreement and the QwestDex Xxxxxx Purchase Agreement.
"QwestDex Purchaser" means Dex Holdings LLC, a Delaware limited
liability company, and its successors and, with respect to either QwestDex
Purchase Agreement, its permitted assignees pursuant to Section 10.5 of such
QwestDex Purchase Agreement.
15
"QwestDex Qualifying Asset Sale" means any Asset Sale by Holdings or
any of its Subsidiaries, except (i) any Qualifying Dexter Asset Sale, (ii) any
Asset Sale to Holdings or to any of its Subsidiaries and (iii) any other single
disposition or series of related dispositions resulting in aggregate Net
Proceeds not exceeding $2,500,000 for any single disposition or series of
related dispositions or $10,000,000 in the aggregate for all such dispositions
which constitute Asset Sales by Holdings or any of its Subsidiaries (other than
an Asset Sale described in clause (i) or (ii) of this definition).
"QwestDex Xxxxxx Purchase Agreement" means the Purchase Agreement dated
August 19, 2002 between QCII, QSC, the Borrower and the QwestDex Purchaser with
respect to the Xxxxxx Assets, as amended, amended and restated, modified or
supplemented from time to time.
"QwestDex Statements" has the meaning set forth in Section 4.04(a).
"Required Lenders" means at any time Lenders having more than 50% of
the aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Loans evidencing more than 50% of the aggregate unpaid
principal amount of the Loans.
"Restatement Date" means the first date after the Closing Date on which
the QCII, QSC or Corp. files a restatement of a Form 10-Q or Form 10-K with the
Securities and Exchange Commission.
"Restricted Payment" means (i) any dividend or other distribution
(whether in cash, securities or other property, including without limitation
pursuant to a "spin-off" or other distribution to equity holders generally) with
respect to any Equity Interest of Holdings or any of its Subsidiaries, or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such Equity Interest, (ii) any
payment of principal, premium or interest in respect of any Intercompany Debt
and (iii) any investment in or other advance of funds to QCII or any of its
Subsidiaries (other than a QwestDex Company), including without limitation any
transfer of funds in connection with the consolidated cash management practices
of QCII but excluding any Permitted Tax Payment.
"Revolver Secured Obligations" has the meaning set forth in the
Security and Pledge Agreement.
"Xxxxxx Assets" means any assets of any QwestDex Company which are to
be sold pursuant to the QwestDex Xxxxxx Purchase Agreement, which assets
constitute assets located in Arizona, Idaho, Montana, Oregon, Utah, Washington
and Wyoming or are used by such QwestDex Company primarily in the conduct of its
business in any of the foregoing states.
16
"Secured Obligations" means the "Secured Obligations" (as defined in
the Security and Pledge Agreement) that have been or will be incurred under the
Loan Documents.
"Security and Pledge Agreement" means the Security and Pledge
Agreement, substantially in the form of Exhibit B, dated as of the Closing Date
among QSC, Holdings, the Borrower and the Agent, as amended from time to time.
"Senior Debt" means the total principal amount of Debt of Holdings and
its Consolidated Subsidiaries, determined on a consolidated basis, excluding
Intercompany Debt and the Guaranty of the QSC Bank Facility.
"Senior Debt Ratio" means, as of the last day of any fiscal quarter,
the ratio of (i) Senior Debt as of the last day of such fiscal quarter to (ii)
Consolidated EBITDA for the period of four fiscal quarters ended on such date.
"Subsidiary" means, as to any Person, any corporation or other entity
of which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person.
"Supplemental Information" has the meaning set forth in Section
4.04(a).
"Term Secured Obligations" has the meaning set forth in the Security
and Pledge Agreement.
"Termination Date" means the second anniversary of the Closing Date,
or, if such day is not a Euro-Dollar Business Day, the next preceding
Euro-Dollar Business Day.
"Tranche A Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make a Tranche A Loan in the amount set
forth opposite the name of such Lender on the Commitment Schedule hereof or in
the applicable Assignment and Assumption Agreement, as such commitment may be
reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 10.06.
"Tranche A Lender" means an Lender with a Tranche A Commitment or an
outstanding Tranche A Loan.
"Tranche A Loan" means a Loan made pursuant to Section 2.01(i).
"Tranche B Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make a Tranche B Loan in the amount set
forth opposite the name of such Lender on the Commitment Schedule hereof or in
the applicable Assignment and Assumption Agreement, as such commitment may
17
be reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 10.06.
"Tranche B Lender" means an Lender with a Tranche B Commitment or an
outstanding Tranche B Loan.
"Tranche B Lending Office" means, as to each Lender, its office located
at its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Lender may hereafter designate as its Tranche Lending Office by
notice to the Borrower and the Agent.
"Tranche B Loan" means a Loan made pursuant to Section 2.01(ii).
"Trigger Event" means (i) the occurrence of an Event of Default or (ii)
a Leverage Trigger Event.
"Type", when used in respect of Tranche A Loan or any Borrowing
comprised of Tranche A Loans, refers to whether such Loans are Domestic Loans or
Euro-Dollar Loans.
"Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market
value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the
States and the District of Columbia, but excluding its territories and
possessions.
"Use of Proceeds Certificate" means a certificate of the Borrower
substantially in the form of Exhibit F, duly completed and executed by the
Borrower.
Section 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time in the
United States, applied on a basis consistent (except for changes concurred in
Holdings' independent public accountants) with the most recent audited
consolidated financial statements of Holdings and its Consolidated Subsidiaries
and/or QSC and its Consolidated Subsidiaries delivered to the Agent (and
delivered by the
18
Agent to the Lenders); provided that, if the Borrower notifies the Agent that
the Borrower wishes to amend any covenant in Article 5 to eliminate the effect
of any change in such generally accepted accounting principles on the operation
of such covenant (or if the Agent notifies the Borrower that the Required
Lenders wish to amend Article 5 for such purpose), then compliance with such
covenant shall be determined on the basis of generally accepted accounting
principles in effect in the United States immediately before the relevant change
in generally accepted accounting principles became effective, until either such
notice is withdrawn or such covenant is amended in a manner satisfactory to the
Borrower and the Required Lenders.
Section 1.03. Types of Borrowings. The term "Borrowing" denotes the
aggregation of Loans of one or more Lenders to be made pursuant to Article 2 on
a single date, all of which Loans are of the same Class and Type (subject to
Article 8) and, in the case of Euro-Dollar Loans, have the same Interest Period
or initial Interest Period. For purposes of this Agreement, Loans may be
classified and referred to by Class (e.g., a "Tranche A Loan" or a "Tranche B
Loan") or by Type (e.g., a "Eurodollar Loan" or a "Base Rate Loan"). Borrowings
also may be classified and referred to by Class (e.g., a "Tranche A Borrowing"
or a "Tranche B Borrowing") or by Type (e.g., a "Eurodollar Borrowing" or a
"Base Rate Borrowing").
ARTICLE 2
THE CREDITS
Section 2.01. Commitments to Lend. Subject to the terms and conditions
set forth in this Agreement (i) each Tranche A Lender severally agrees to make
on the Borrowing Date a single Tranche A Loan to the Borrower in a principal
amount not exceeding the amount of its Tranche A Commitment, and (ii) defined.
each Tranche B Lender severally agrees to make on the Borrowing Date a single
Tranche B Loan to the Borrower in a principal amount not exceeding the amount of
its Tranche B Commitment. None of the Commitments is revolving in nature, and
principal amounts of the Loans of either Class repaid or prepaid may not be
reborrowed.
Section 2.02. Notice of Borrowing. The Borrower shall give the Agent
notice, substantially in the form of Exhibit E (the "Notice of Borrowing"), not
later than 10:30 A.M. (New York City time) on (x) the third Euro-Dollar Business
Day before the Borrowing Date, if any Euro-Dollar Loans are to be made on the
Borrowing Date and (y) otherwise, the Borrowing Date, specifying:
(i) the proposed Borrowing Date, which shall be a
Domestic Business Day, and if any Euro-Dollar Loans are to be made on
the Borrowing Date, which shall also be Euro-Dollar Business Day,
19
(ii) the aggregate amount of the Borrowing of each Class
to be made on the Borrowing Date; provided that the Borrower may not
request a Borrowing of either Class unless (x) contemporaneously
therewith, the Borrower shall have requested a Borrowing of the other
Class, and (y) the amount of the Borrowing of each Class (expressed as
a percentage of the Commitments of such Class) shall be the same,
(iii) whether the Loans included in the Tranche A Borrowing
bear interest initially at the Base Rate or at a Euro-Dollar Rate, and
(iv) in the case of a Euro-Dollar Borrowing, the duration
of the initial Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
Section 2.03. [Intentionally Deleted].
Section 2.04. Notice to Lenders; Funding of Loans. Upon receipt of the
Notice of Borrowing, the Agent shall promptly notify each Lender of the contents
thereof and of such Lender's share (if any) of the Borrowing of the relevant
Class and the Notice of Borrowing shall not thereafter be revocable by the
Borrower.
(b) Not later than 1:00 P.M. (New York City time) on the date of
the Borrowing, each Lender shall make available its share (if any) of the
Borrowing of the relevant Class, in Federal or other funds immediately available
in New York City, to the Agent at its address referred to in Section 10.01.
Unless any applicable condition specified in Article 3 has not been satisfied,
as determined by the Agent in accordance with Article 3, the Agent will make the
funds so received from the Lenders immediately available to the Borrower at the
Agent's aforesaid address.
(c) Unless the Agent shall have received notice from a Lender
prior to the Borrowing Date that such Lender will not make available to the
Agent such Lender's share of the Borrowing of the relevant Class, the Agent may
assume that such Lender has made such share available to the Agent on the
Borrowing Date in accordance with subsection (b) of this Section 2.04 and the
Agent may, in reliance upon such assumption, make available to the Borrower on
the Borrowing Date a corresponding amount. If and to the extent that such Lender
shall not have so made such share available to the Agent, such Lender and the
Borrower severally agree to repay to the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Agent, at (i) in the case of the Borrower, a rate per annum equal
to the higher of the Federal Funds Rate and the interest rate applicable thereto
pursuant to Section 2.07 and (ii) in the case of such Lender, the Federal Funds
Rate. If such Lender shall repay to the Agent such corresponding amount, such
amount so repaid shall constitute such Lender's Loan included in the relevant
Borrowing for purposes of this
20
Agreement. If the Borrower shall have repaid such corresponding amount of such
Lender, such Lender shall reimburse the Borrower for any loss on account thereof
incurred by the Borrower. Nothing contained in the foregoing shall be construed
as relieving an Lender of its obligation to fund a Loan when required under the
terms of this Agreement.
Section 2.05. Notes; Evidence of Loans. (a) Any Lender may, by notice
to the Borrower and the Agent, request that Loans made by it be evidenced by a
single Note payable to the order of such Lender for the account of its
Applicable Lending Office, unless such Lender indicates otherwise, in an amount
equal to the aggregate unpaid principal amount of such Lender's Loans.
(b) Any Lender may, by notice to the Borrower and the Agent,
request that its Loans of a particular Class or Type be evidenced by a separate
Note in an amount equal to the aggregate unpaid principal amount of such Loans.
Each such Note shall be in substantially the form of Exhibit A hereto with
appropriate modifications to reflect the fact that it evidences solely Loans of
the relevant Class or Type. Each reference in this Agreement to a "Note" or the
"Notes" of such Lender shall be deemed to refer to and include any or all of
such Notes, as the context may require.
(c) Upon receipt of any Lender's Notes pursuant to Section 3.01,
the Agent shall forward such Notes to such Lender. Each Lender shall record the
date, amount, Class and Type of the Loans made by it and the date and amount of
each payment of principal made with respect thereto, and may, if such Lender so
elects in connection with any transfer or enforcement of its Note, endorse on
the schedule forming a part thereof appropriate notations to evidence the
foregoing information with respect to each such Loan then outstanding; provided
that the failure of any Lender to make any such recordation or endorsement shall
not affect the obligations of the Borrower hereunder or under the Notes or any
other Loan Document. Each Lender is hereby irrevocably authorized by the
Borrower so to endorse its Notes and to attach to and make a part of any Note a
continuation of any such schedule as and when required.
(d) Loans made by each Lender and not evidenced by a Note shall be
evidenced by one or more accounts or records maintained by such Lender and by
the Agent in the ordinary course of business. The accounts or records maintained
by the Agent and each Lender shall be conclusive absent manifest error of the
amount of the Loans made by the Lenders to the Borrower and the interest and
payments thereon. Any failure to so record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrower hereunder to
pay any amount owing with respect to the Loans.
(e) The Borrower authorizes the Agent, and the Agent agrees, to
maintain, or cause to be maintained at its offices, a copy of each Assignment
and Assumption Agreement delivered to and accepted by it and a register (the
"Register") for the recordation of the names and addresses of the Lenders and
the
21
Commitments of, and principal amount of the Loans owing to each Lender from time
to time. The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Agent and the Lenders
shall treat each Person whose name is recorded in the Register as a Lender
hereunder for all purposes of this Agreement. The Register shall be available
for inspection by the Borrower and any Lender at any reasonable time and from
time to time upon reasonable prior notice. Each Lender shall maintain a register
of its participants comparable to the Register. Failure to make any such
recordation, or any error in such recordation, shall not affect the obligations
of any Loan Party under the Loan Documents.
(f) With respect to any Loans hereunder, whether or not evidenced
by a Note, in the event of any conflict between the accounts and records
maintained by the Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Agent shall control in the absence
of manifest error.
Section 2.06. Maturity of Loans. Each Loan shall mature, and the
principal amount thereof shall be due and payable, together with accrued
interest thereon, on the Termination Date.
Section 2.07. Interest Rates. (a) Each Domestic Loan shall bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until it becomes due, at a rate per annum equal to the sum of
the Base Rate Margin plus the Base Rate for such day. Such interest shall be
payable quarterly in arrears on the last day of each calendar quarter and, with
respect to the principal amount of any Domestic Loan converted to a Euro-Dollar
Loan, on each date a Domestic Loan is so converted. Any overdue principal of or
interest on any Domestic Loan shall bear interest, payable on demand, for each
day until paid at a rate per annum equal to the sum of 2% plus the rate
otherwise applicable to Domestic Loans for such day.
"Base Rate Margin" means a rate per annum equal to 8.75%.
(b) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
per annum equal to the sum of the Euro-Dollar Margin plus the applicable
Adjusted London Interbank Offered Rate. Such interest shall be payable for each
Interest Period on the last day thereof and, if such Interest Period is longer
than three months, at intervals of three months after the first day thereof.
The "Adjusted London Interbank Offered Rate" applicable to any Interest
Period means a rate per annum equal to the quotient obtained (rounded upward, if
necessary, to the next higher 1/100 of 1%) by dividing (x) the applicable London
Interbank Offered Rate by (y) 1.00 minus the Euro-Dollar Reserve Percentage.
00
"Xxxx-Xxxxxx Xxxxxx" means a rate per annum equal to 11.50%.
The "London Interbank Offered Rate" applicable to any Interest Period
means:
(A) the rate per annum equal to the rate
determined by the Agent to be the offered rate that appears on
the page of the Telerate screen (or any successor thereto)
that displays an average British Bankers Association Interest
Settlement Rate for deposits in dollars (for delivery on the
first day of such Interest Period) with a term equivalent to
such Interest Period, determined as of approximately 11:00
A.M. (London time) two Euro-Dollar Business Days prior to the
first day of such Interest Period, or
(B) if the rate referenced in the preceding
clause (A) does not appear on such page or service or such
page or service shall cease to be available, the rate per
annum equal to the rate determined by the Agent to be the
offered rate on such other page or other service that displays
an average British Bankers Association Interest Settlement
Rate for deposits in dollars (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 A.M. (London
time) two Euro-Dollar Business Days prior to the first day of
such Interest Period, or
(C) if the rates referenced in the preceding
clauses (A) and (B) are not available, the rate per annum
determined by the Agent as the rate of interest at which
deposits in dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of
the Euro-Dollar Loan being made, continued or converted by
Bank of America, N.A., and with a term equivalent to such
Interest Period, would be offered by Bank of America, N.A.'s
London Branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 P.M.
(London time) two Euro-Dollar Business Days prior to the first
day of such Interest Period.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Lender to
United States residents). The Adjusted London Interbank Offered Rate shall be
adjusted
23
automatically on and as of the effective date of any change in the Euro-Dollar
Reserve Percentage.
Any overdue principal of or interest on any Euro-Dollar Loan shall bear
interest, payable on demand, for each day from and including the date payment
thereof was due to but excluding the date of actual payment, at a rate per annum
equal to the sum of 2% plus the higher of (A) the Euro-Dollar Margin plus the
quotient obtained (rounded upward, if necessary, to the next higher 1/100 of 1%)
by dividing (x) the rate per annum at which one day (or, if such amount due
remains unpaid more than three Euro-Dollar Business Days, then for such other
period of time not longer than six months as the Agent may select) deposits in
dollars in an amount approximately equal to such overdue payment due to Bank of
America, N.A. are offered to Bank of America, N.A., in the London interbank
market for the applicable period determined as provided above by (y) 1.00 minus
the Euro-Dollar Reserve Percentage (or, if the circumstances described in clause
(a) or (b) of Section 8.01 shall exist, at a rate per annum equal to the sum of
2% plus the rate applicable to Domestic Loans for such day) and (B) the sum of
the Euro-Dollar Margin plus the Adjusted London Interbank Offered Rate
applicable to such Loan at the date such payment was due.
(c) Each Tranche B Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the Fixed Rate. Such interest shall be
payable quarterly in arrears on the last day of each calendar quarter. Any
overdue principal of or interest on any Tranche B Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the sum
of 2% plus the Fixed Rate.
"Fixed Rate" means a rate per annum equal to 14.00%.
(d) The Agent shall determine each interest rate applicable to the
Tranche A Loans hereunder. The Agent shall give prompt notice to the Borrower
and the Tranche A Lenders of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
Section 2.08. [Intentionally Deleted].
Section 2.09. Termination of Commitments. The Commitments shall
automatically terminate on the earlier of (i) close of business (New York City
time) on September 6, 2002 and (ii) the Borrowing Date, immediately after the
Loans are made.
Section 2.10. Method of Electing Interest Rates with Respect to
Tranche A Loans. (a) The Loans included in the Tranche A Borrowing shall bear
interest initially at the Type of rate specified by the Borrower in the Notice
of Borrowing. Thereafter, the Borrower may from time to time elect to change or
continue the
24
Type of interest rate borne by each Group of Tranche A Loans (subject in each
case to the provisions of Article 8), as follows:
(i) if such Loans are Domestic Loans, the Borrower may
elect to convert such Loans to Euro-Dollar Loans as of any Euro-Dollar
Business Day; and
(ii) if such Loans are Euro-Dollar Loans, the Borrower may
elect to convert such Loans to Domestic Loans or elect to continue such
Loans as Euro-Dollar Loans for an additional Interest Period, in each
case effective on the last day of the then current Interest Period
applicable to such Loans.
Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Agent at least three Euro-Dollar Business Days before the
conversion or continuation selected in such notice is to be effective. A Notice
of Interest Rate Election may, if it so specifies, apply to only a portion of
the aggregate principal amount of the relevant Group of Tranche A Loans;
provided that (i) such portion is allocated ratably among the Tranche A Loans
comprising such Group and (ii) the portion to which such Notice applies, and the
remaining portion to which it does not apply, are each $25,000,000 or any larger
multiple of $5,000,000.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Tranche A Loans (or portion thereof) to
which such notice applies;
(ii) the date on which the conversion or continuation
selected in such notice is to be effective, which shall comply with the
applicable clause of subsection (a) above;
(iii) if the Loans comprising such Group are to be
converted, the new Type of Loans and, if such new Loans are Euro-Dollar
Loans, the duration of the initial Interest Period applicable thereto;
and
(iv) if such Loans are to be continued as Euro-Dollar
Loans for an additional Interest Period, the duration of such
additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from the
Borrower pursuant to subsection (a) above, the Agent shall promptly notify each
Tranche A Lender of the contents thereof and such notice shall not thereafter be
revocable by the Borrower. If the Borrower fails to deliver a timely Notice of
25
Interest Rate Election to the Agent for any Group of Euro-Dollar Loans, such
Loans shall be converted into Domestic Loans on the last day of the then current
Interest Period applicable thereto.
Section 2.11. Prepayments.
(a) Subject in the case of any Euro-Dollar Loans to Section 2.13,
the Borrower may, upon at least one Domestic Business Day's notice to the Agent,
prepay any Group of Domestic Loans or the Tranche B Loans or, upon three
Euro-Dollar Business Days' notice to the Agent, prepay any Group of Euro-Dollar
Loans, in each case in whole at any time, or from time to time in part in
amounts aggregating $25,000,000 or any larger multiple of $5,000,000, by paying
the principal amount to be prepaid together with accrued interest thereon to the
date of prepayment; provided that the Borrower may prepay Loans of one Class
pursuant to this subsection (a) only if contemporaneously therewith the Borrower
shall prepay Loans of the other Class (pro rata on the basis of aggregate
principal amount of Loans of each Class the outstanding) pursuant to this
subsection (a).
(b) On the third Euro-Dollar Business Day after any date on which
any Net Proceeds are received by or on behalf of QCII or any of its Subsidiaries
in respect of any Prepayment Event, the Borrower shall prepay Loans in an
aggregate principal amount equal to 100% of such Net Proceeds.
(c) The Borrower shall prepay Loans in an aggregate principal
amount equal to 25% of Excess Cash Flow for each fiscal year of Holdings,
commencing with the fiscal year ending December 31, 2003. Each such prepayment
shall be made on the third Euro-Dollar Business Day after the date on which
financial statements of Holdings are delivered pursuant to Section 5.01 with
respect to the relevant fiscal year (and in any event no later than the 95th day
after the end of such fiscal year).
(d) If a Leverage Trigger Event shall have occurred at any fiscal
quarter end, on each Contingent Prepayment Date following the date on which the
related financial statements were (or were required to be) delivered pursuant to
Section 5.01 for so long as such Trigger Event is continuing, the Borrower shall
prepay an aggregate principal amount of the Loans equal to the related
Contingent Prepayment Amount.
(e) Upon receipt of a notice of prepayment pursuant to this
Section or Section 2.15, the Agent shall promptly notify each Lender of the
contents thereof and of such Lender's ratable share of such prepayment and such
notice shall not thereafter be revocable by the Borrower.
(f) Each prepayment of the Loans pursuant to subsections (b), (c)
or (d) above shall be applied to prepay ratably the Loans of each Class (on the
basis of aggregate principal amount of Loans of each Class the outstanding).
Each prepayment of the Tranche A Loans pursuant to subsections (a), (b) or (c)
above
26
shall be applied to prepay the Loans of the several Lenders included in such
Group or Groups of Tranche A Loans as the Borrower shall have specified in the
relevant notice of prepayment (or, if the Borrower shall have failed to so
specify, such Group or Groups of Tranche A Loans as the Agent shall determine in
its discretion).
Section 2.12. General Provisions as to Payments. (a) The Borrower
shall make each payment of principal of, and interest on, the Loans and of fees
and other amounts payable hereunder, not later than 12:00 Noon (New York City
time) on the date when due, in Federal or other funds immediately available in
New York City, without off set or counterclaim, to the Agent at its address
referred to in Section 10.01. The Agent will promptly distribute to each Lender
its ratable share of each such payment received by the Agent for the account of
the Lenders. Whenever any payment of principal of, or interest on, the Domestic
Loans, Tranche B Loans or other amounts payable hereunder (other than amounts
described in the immediately succeeding sentence) shall be due on a day which is
not a Domestic Business Day, the date for payment thereof shall be extended to
the next succeeding Domestic Business Day. Whenever any payment of principal of,
or interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day.
(b) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due from the Borrower to the Lenders
hereunder that the Borrower will not make such payment in full, the Agent may
assume that the Borrower has made such payment in full to the Agent on such date
and the Agent may, in reliance upon such assumption, cause to be distributed to
each Lender on such due date an amount equal to the amount then due such Lender.
If and to the extent that the Borrower shall not have so made such payment, each
Lender shall repay to the Agent forthwith on demand such amount distributed to
such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Agent, at the Federal Funds Rate.
Section 2.13. Funding Losses. If the Borrower makes any payment of
principal with respect to any Euro-Dollar Loan or any Euro-Dollar Loan is
converted to a Domestic Loan (pursuant to Article 2, 6 or 8 or otherwise) on any
day other than the last day of an Interest Period applicable thereto, or the
last day of an applicable period fixed pursuant to Section 2.07(d), or if the
Borrower fails to borrow or prepay any Euro-Dollar Loan, or convert or continue
any Euro-Dollar Loans, in each case after notice has been given to any Lender in
accordance with Section 2.04(a), 2.11(a) or 2.15, as applicable, the Borrower
shall reimburse each Lender within 15 days after demand for any resulting loss
or expense incurred by it (or by an existing or prospective Participant in the
related Loan), including (without limitation) any loss incurred in obtaining,
liquidating or
27
employing deposits from third parties, but excluding loss of margin for the
period after any such payment or conversion or failure to borrow or prepay,
provided that such Lender shall have delivered to the Borrower a certificate as
to the amount of such loss or expense, which certificate shall be conclusive in
the absence of manifest error. Any Lender requesting compensation pursuant to
this Section 2.13 shall notify the Borrower of such request on or before the
date that is three Euro-Dollar Business Days after the event giving rise to such
request.
Section 2.14. Computation of Interest. Interest based on the Prime
Rate or the Fixed Rate hereunder shall be computed on the basis of a year of 365
days (or 366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
Section 2.15. Notice of Prepayment Events. The Borrower shall notify
the Agent by telephone (confirmed by telecopy) of the proposed consummation of
any Prepayment Event (and the prepayment of the Loans pursuant to Section
2.11(b)), not later than 10:30 a.m., New York City time, on the date of the
proposed consummation thereof. Each such notice shall be irrevocable and shall
specify (i) the date of consummation of the applicable Prepayment Event, (ii) a
reasonably detailed calculation of the Net Proceeds thereof, and (iii) the
amount of the prepayment of the Loans as a result of such Prepayment Event. Upon
receipt of a notice of a Prepayment Event pursuant to this subsection, the Agent
shall promptly notify each Lender of the contents thereof.
ARTICLE 3
CONDITIONS
Section 3.01. Closing. The closing hereunder shall occur upon receipt
by the Agent (or its counsel) of the following (in the case of any document,
dated the Closing Date unless otherwise indicated):
(a) duly executed counterparts hereof signed by each of the
Borrower, the Guarantors, the Lenders and the Agent (or, in the case of any
party as to which an executed counterpart shall not have been received, written
evidence satisfactory to the Agent (which may include telecopy transmission of a
signed signature page) that such party has signed a counterpart hereof);
(b) a duly executed Note for the account of each Lender requesting
a Note dated on or before the Closing Date complying with the provisions of
Section 2.05;
(c) (i) duly executed counterparts of the Security and Pledge
Agreement and (ii) evidence satisfactory to the Agent that the Collateral and
Guaranty Requirement shall have been satisfied;
28
(d) evidence satisfactory to the Agent in its discretion of the
effectiveness of an amendment and restatement of the QSC Existing Bank Facility
on terms and conditions reasonably satisfactory to the Required Lenders;
(e) opinions of Xxxx Xxxx, associate general counsel for the Loan
Parties, O'Melveny & Xxxxx LLP, special counsel to the Loan Parties, Holme
Xxxxxxx & Xxxx LLP, special counsel to the Loan Parties, and Xxxxx & Xxxxxxx,
L.L.P., special regulatory counsel to the Loan Parties, covering the matters set
forth in Exhibits C-1, C-2, C-3 and C-4 hereto, respectively, and such
additional matters relating to the transactions contemplated hereby as the
Required Lenders may reasonably request;
(f) evidence satisfactory to the Agent of the payment of all fees
and other amounts payable to the Agent for the account of the Lenders or the
Agent on or prior to the Closing Date, including, to the extent invoiced,
reimbursement of all out-of-pocket expenses (including, without limitation,
legal fees and expenses) required to be reimbursed or paid by the Borrower
hereunder;
(g) evidence satisfactory to the Agent in its discretion that
neither QCII nor any of its Subsidiaries (including without limitation any Loan
Party) shall be the subject of a proceeding under Chapter 11 of the Bankruptcy
Code;
(h) the QwestDex Restated Statements, in each case in form and
substance reasonably satisfactory to the Agent (which financial statements shall
be made available to each Lender upon request);
(i) the QwestDex Inc. Intercompany Note and the QwestDex Holdings
Intercompany Note shall have been modified so as to extend the maturity thereof
to a date not earlier than 91 days after the Termination Date, to be
subordinated to the Loans and the Guarantees hereunder on terms and conditions
satisfactory to the Agent and otherwise to be on terms and conditions reasonably
satisfactory in form and substance to the Required Lenders; and
(j) all documents the Agent may reasonably request relating to the
existence of the Loan Parties, the corporate authority for and the validity of
the Loan Documents, and any other matters relevant hereto, all in form and
substance reasonably satisfactory to the Agent.
The Agent shall promptly notify the Borrower and the Lenders of the
Closing Date, and such notice shall be conclusive and binding on all parties
hereto.
Section 3.02. The Borrowing Date. The obligation of any Lender to make
a Loan on the Borrowing Date is subject to the satisfaction of the following
conditions:
29
(a) the fact that the Closing Date shall have occurred on or prior
to September 6, 2002,
(b) the fact that the Borrowing Date shall occur on the Closing
Date;
(c) receipt by the Agent of the Notice of Borrowing as required by
Section 2.02;
(d) the fact that, immediately before and after the Borrowings to
occur on the Borrowing Date, no Default shall have occurred and be continuing;
(e) the fact that the representations and warranties of the Loan
Parties contained in the Loan Documents shall be true on and as of the Borrowing
Date; and
(f) receipt by the Agent of the Use of Proceeds Certificate.
The Borrowing hereunder shall be deemed to be a representation and
warranty by the Borrower on the Borrowing Date as to the facts specified in
clauses (d) and (e) of this Section.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Each of the Loan Parties party to this Agreement represents and
warrants that:
Section 4.01. Corporate Existence and Power. Each Loan Party is a
corporation duly incorporated, validly existing and in good standing under the
laws of the state of its incorporation, and has all corporate powers and all
material governmental licenses, authorizations, qualifications, consents and
approvals required to carry on its business as now conducted.
Section 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by each Loan Party of
each Loan Document to which it is a party are within such Person's corporate
powers, have been duly authorized by all necessary corporate action, require no
action by or in respect of, or filing with, any governmental body, agency or
official except, with respect to the Security and Pledge Agreement and the
transactions contemplated thereby, as set forth in the Collateral Documents, and
do not contravene, or constitute a default under, any provision of applicable
law or regulation or of the certificate of incorporation or by-laws of such
Person or of any material agreement (including in any event the QCII Indentures
and the QwestDex Purchase Agreements), judgment, injunction, order, decree or
other instrument binding upon such Person or any Significant Subsidiary or
result in the
30
creation or imposition of any Lien on any material asset of such Person or any
Significant Subsidiary (other than the Liens created by the Collateral
Documents).
Section 4.03. Binding Effect. Each Loan Document (other than the
Notes) constitutes a valid and binding agreement of each Loan Party party
thereto, and the Notes, when executed and delivered in accordance with this
Agreement, will constitute valid and binding obligations of the Borrower, in
each case enforceable in accordance with its terms except as the same may be
limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and by general principles of equity.
Section 4.04. Financial Information.
(a) (i) The audited consolidated balance sheet of Holdings and its
Consolidated Subsidiaries as of December 31, 2000 and December 31, 2001 and, in
each case, the related consolidated statements of income and cash flows for the
fiscal year then ended, as well as the consolidated statements of income and
cash flows for the fiscal year ended December 31, 1999, all reported on by KPMG
(collectively, the "QwestDex Statements") and (ii) the consolidated balance
sheet of Holdings and its Consolidated Subsidiaries as of June 30, 2002 a copy
of each of which has been delivered to each of the Lenders, taken together,
fairly present in all material respects, in conformity with generally accepted
accounting principles, the consolidated financial position of Holdings and its
Consolidated Subsidiaries as of such date specified therein and their
consolidated results of operations and cash flows for such period specified
therein, except in each case as listed in the information set forth in Schedule
4.04(a) (collectively, the "Supplemental Information") or as modified by the
financial statements as of such date or for such period described in clause (ii)
of this subsection 4.04(a) or delivered pursuant to Section 5.01(g), and subject
to changes resulting from audit and year-end adjustments and the absence of
footnotes.
(b) Since June 30, 2002, there has been no material adverse change
in the financial position or results of operations of Holdings and its
Consolidated Subsidiaries, considered as a whole, except as set forth in the
Supplemental Information (it being understood that (i) the restatement of the
financial statements of QCII or any of its Consolidated Subsidiaries with
respect to any fiscal period, or as of any date, ended on or prior to June 30,
2002 and (ii) the facts or events disclosed to the Lenders prior to the Closing
Date as the facts or events necessitating such restatement shall not, in and of
themselves, constitute a material adverse change in the financial position or
results of operations of Holdings and its Consolidated Subsidiaries, considered
as a whole).
Section 4.05. Litigation. Except as disclosed in the QCII's 2001 Form
10-K and as specifically identified in Schedule 4.05, there is no action, suit
or proceeding pending, or to the knowledge of QSC, Holdings or the Borrower,
31
threatened, against QCII or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable possibility of an adverse decision which would materially adversely
affect the financial position or results of operations of Holdings and its
Consolidated Subsidiaries, considered as a whole, or which in any manner draws
into question the validity of any Loan Document.
Section 4.06. Compliance with ERISA. Each member of the ERISA Group
has fulfilled its obligations under the minimum funding standards of ERISA and
the Internal Revenue Code with respect to each Plan and is in compliance in all
respects with the presently applicable provisions of ERISA and the Internal
Revenue Code with respect to each Plan, except where failure to comply would not
have a material adverse effect on the consolidated financial position or
consolidated results of operations of QCII and its Consolidated Subsidiaries,
considered as a whole. No member of the ERISA Group has (i) sought a waiver of
the minimum funding standard under Section 412 of the Internal Revenue Code in
respect of any Plan, (ii) failed to make any contribution or payment to any Plan
or Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, in either case, which has resulted
or could reasonably be expected to result in the imposition of a Lien or the
posting of a bond or other security under ERISA or the Internal Revenue Code or
(iii) incurred any liability under Title IV of ERISA other than a liability to
the PBGC for premiums under Section 4007 of ERISA.
Section 4.07. Environmental Matters. (a) The operations of Holdings
and each of its Subsidiaries comply in all respects with all Environmental Laws
except such non-compliance which would not (if enforced in accordance with
applicable law) reasonably be expected to result, individually or in the
aggregate, in a material adverse effect on the financial position or results of
operations of Holdings and its Consolidated Subsidiaries, considered as a whole.
(b) Except as specifically identified in Schedule 4.07, Holdings
and each of its Subsidiaries have obtained all material licenses, permits,
authorizations and registrations required under any Environmental Laws
("Environmental Permits") necessary for their respective operations, and all
such Environmental Permits are in good standing, and Holdings and each of its
Subsidiaries is in compliance with all material terms and conditions of such
Environmental Permits.
(c) Except as specifically identified in Schedule 4.07, there are
neither any conditions or circumstances known to Holdings which may give rise to
any claims or liabilities respecting any Environmental Laws or Hazardous
Substances arising from the operations of Holdings or its Subsidiaries
(including, without limitation, off-site liabilities), nor any additional costs
of compliance with Environmental Laws, which collectively have an aggregate
potential liability in excess of $25,000,000.
32
Section 4.08. Taxes. United States Federal income tax returns of QCII
and its Subsidiaries have been examined and closed through the fiscal year ended
December 31, 1992. QCII and its Subsidiaries have filed all United States
Federal income tax returns and all other material tax returns which are required
to be filed by them and have paid all taxes due pursuant to such returns or
pursuant to any assessment received by QCII or any Subsidiary, except for taxes
the amount, applicability or validity of which is being contested in good faith
by appropriate proceedings. The charges, accruals and reserves on the books of
QCII and its Subsidiaries in respect of taxes or other governmental charges are,
in the opinion of QCII, adequate.
Section 4.09. Subsidiaries. The Borrower is the only Subsidiary of
Holdings that exists on the Closing Date.
Section 4.10. Not an Investment Company. No Loan Party is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
Section 4.11. Full Disclosure. All written information heretofore
furnished by any Loan Party to the Agent or any Lender for purposes of or in
connection with the Loan Documents or any transaction contemplated hereby is,
and all such information hereafter furnished by any Loan Party to the Agent or
any Lender will be, true and accurate in all material respects on the date as of
which such information is stated or certified, in each case in light of the
circumstances in which the same were made and subject to the Supplemental
Information. Any projections or pro forma financial information contained in
such materials are based upon good faith estimates and assumptions believed by
the applicable Loan Party to be reasonable at the time they were made, it being
recognized that such projections are not to be viewed as facts and that actual
results may differ and such differences may be material.
Section 4.12. Solvency. On the Closing Date, immediately after giving
effect to the transactions contemplated herein (a) the fair value of the assets
of each Loan Party, at a fair valuation, will exceed its debts and liabilities,
subordinated, contingent or otherwise, (b) the present fair saleable value of
the properties of each Loan Party will exceed the amount that will be required
to pay the probable liability of its debts and other liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute and
matured, (c) each Loan Party will be able to pay its debts and other
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured, and (d) no Loan Party will have
unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted and proposed to be conducted after the
Closing Date.
33
ARTICLE 5
COVENANTS
Each Loan Party agrees that, so long as any Lender has any Commitment
hereunder or any Loan or any other amount payable under any Loan Document
remains unpaid:
Section 5.01. Information. The Borrower will deliver to the Agent for
distribution to each of the Lenders:
(a) (i) as soon as available and in any event within 90 days after
the end of each fiscal year of Holdings, a consolidated balance sheet of
Holdings and its Consolidated Subsidiaries as of the end of such fiscal year and
the related consolidated statements of income and cash flows for such fiscal
year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on in a manner acceptable to the Securities
and Exchange Commission by KPMG or other independent public accountants of
nationally recognized standing, and (ii) as soon as available and in any event
within 90 days after the end of each fiscal year of QSC, a consolidated balance
sheet of QSC and its Consolidated Subsidiaries as of the end of such fiscal year
and the related consolidated statements of income and cash flows for such fiscal
year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on in a manner acceptable to the Securities
and Exchange Commission by KPMG or other independent public accountants of
nationally recognized standing; provided that, with respect to any set of
financial statements required of QSC to be delivered pursuant to this clause
(ii) prior to the Restatement Date, QSC may, by notice to the Agent, elect (one
time only with respect to any set of financial statements of QSC) that the date
on which such financial statements are required to be delivered be extended to
the earlier of (x) the date on which any filing is made with the Securities and
Exchange Commission which filing includes such financial statements and (y) the
date specified in such notice (which date shall be no later than the date which
is 135 days after the end of the relevant fiscal year of QSC) and, upon receipt
of such notice, such date of delivery shall be extended to the earlier of the
date described in clause (x) and the date set forth in such notice;
(b) (i) as soon as available and in any event within 50 days after
the end of each of the first three quarters of each fiscal year of Holdings,
beginning with the fiscal quarter ending September 30, 2002, a consolidated
balance sheet of Holdings and its Consolidated Subsidiaries as of the end of
such quarter and the related consolidated statements of income and cash flows
for such quarter and for the portion of Holdings' fiscal year ended at the end
of such quarter, setting forth in the case of such statements of income and cash
flows in comparative form the figures for the corresponding quarter and the
corresponding portion of Holdings' previous fiscal year, all certified (subject
to normal year-end adjustments) as to fairness of presentation, generally
accepted accounting principles and consistency by the chief financial officer or
the chief accounting officer of Holdings, and (ii) as soon as available and in
any event within 50 days after the end of each of the first three quarters of
each fiscal year of QSC, beginning with the fiscal quarter ending September 30,
2002, a consolidated balance sheet of QSC and its Consolidated Subsidiaries as
of the end of such quarter and the related consolidated statements of income and
cash flows for such quarter and for the portion of QSC's fiscal year ended at
the end of such quarter, setting forth in the case of such statements of income
and cash flows in comparative form the figures for the corresponding quarter and
the corresponding portion of QSC's previous fiscal year, all certified (subject
to normal year-end adjustments) as to fairness of
34
presentation, generally accepted accounting principles and consistency by the
chief financial officer or the chief accounting officer of QSC; provided that,
with respect to any set of financial statements required of QSC to be delivered
pursuant to this clause (ii) prior to the Restatement Date, QSC may, by notice
to the Agent, elect (one time only with respect to any set of financial
statements of QSC) that the earlier of (x) the date on which any filing is made
with the Securities and Exchange Commission which filing includes such financial
statements and (y) the date on which such financial statements are required to
be delivered be extended to the date specified in such notice (which date shall
be no later than the date which is 95 days after the end of the relevant fiscal
quarter of QSC) and, upon receipt of such notice, such date of delivery shall be
extended to the earlier of the date described in clause (x) and the date set
forth in such notice;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate, in form and
scope satisfactory to the Agent, of the chief financial officer (or such
officer's designee, designated in writing by such officer) or the chief
accounting officer of Holdings or QSC, as applicable, (i) in the case of
financial statements of Holdings, setting forth in reasonable detail the
calculations required to establish whether Holdings was in compliance with the
requirements of Sections 5.06, 5.07, 5.10, 5.12 and 5.13 on the date of such
financial statements and (ii) stating whether any Default exists on the date of
such certificate and, if any Default then exists, setting forth the details
thereof and the action which Holdings or QSC, as applicable, is taking or
proposes to take with respect thereto; and (2) in any event no later than 90
days after the end of each fiscal year of Holdings and 50 days after the end of
each fiscal quarter of Holdings, a certificate of the chief financial officer
(or such officer's designee, designated in writing by such officer) or the chief
accounting officer of Holdings (i) setting forth in reasonable detail the
calculations required to establish whether the Qwest Dex Companies were in
compliance with the requirements of Sections 5.07, 5.10, 5.12 and 5.13 on the
last day of such fiscal year or fiscal quarter, as applicable and (ii) stating
whether any Default exists on the date of such certificate (other than any
Default as a result of a breach of 5.06, which any certificate delivered
pursuant to this clause (2) shall not be required to address) and, if any
Default then exists, setting forth the details thereof and the action which
Holdings is taking or proposes to take with respect thereto;
(d) within five Domestic Business Days after any officer of QSC,
Holdings or the Borrower obtains knowledge of any Default, if such Default is
then continuing, a certificate of the chief financial officer or the chief
accounting officer of such Loan Party setting forth the details thereof and the
action which such Loan Party is taking or proposes to take with respect thereto;
(e) upon delivery of any financial statements or other financial
information to the holders of any Debt under the QSC Bank Facility, with respect
to any Loan Party, without duplication of any statements or information
otherwise delivered hereunder, copies of any such statements or information;
(f) if and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) with respect to any Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate,
35
impose liability (other than for premiums under Section 4007 of ERISA) in
respect of, or appoint a trustee to administer any Plan, a copy of such notice;
(iv) applies for a waiver of the minimum funding standard under Section 412 of
the Internal Revenue Code, a copy of such application; (v) gives notice of
intent to terminate any Plan under Section 4041(c) of ERISA, a copy of such
notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vi) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement, in either case, which has resulted
or could reasonably be expected to result in the imposition of a Lien or the
posting of a bond or other security, a certificate of the chief financial
officer or the chief accounting officer of QCII setting forth details as to such
occurrence and action, if any, which QCII or applicable member of the ERISA
Group is required or proposes to take;
(g) as soon as available, the restated consolidated financial
statements of QCII and Corp., for any date, or any period, ended prior to the
Closing Date, such statements to be audited by KPMG (but only if they relate to
a period with respect to which audited financial statements have been previously
issued) and to be reported on by KPMG in a manner acceptable to the Securities
and Exchange Commission; and
(h) from time to time such additional information regarding the
financial position or business of QSC and its Subsidiaries as the Agent, at the
request of any Lender, may reasonably request.
Information required to be delivered pursuant to clauses 5.01(a), (b), (e) or
(f) above shall be deemed to have been delivered on the date on which Borrower
delivers such information to the Agent for posting on IntraLinks/IntraAgency or
other relevant third-party commercial website (if any) on the Borrower's behalf;
provided that (i) the Borrower shall deliver paper copies of the information
referred to in clauses 5.01(a), (b), (d) or (e) to any Lender which requests
such delivery and (ii) in every instance the Borrower shall provide paper copies
of the certificates required by Section 5.01(c) to the Agent and each Lender
requesting the same. Except for such certificates delivered pursuant to Section
5.01(c), the Agent shall have no obligation to request the delivery or maintain
copies of the information referred to above, and in any event shall have no
responsibility to monitor compliance by the Borrower with any such request for
delivery, and each Lender shall be solely responsible for requesting delivery to
it or maintaining copies of such information.
Section 5.02. Maintenance of Property; Insurance. (a) Each QwestDex
Company will keep all property useful and necessary in its business in good
working order and condition, ordinary wear and tear excepted.
(b) Each QwestDex Company will maintain (either in the name of the
Borrower or in its own name), with financially sound and responsible insurance
36
companies, insurance on all their respective properties in at least such amounts
and against at least such risks (and with such risk retention) as are usually
insured against in the same general area by companies of established repute
engaged in the same or a similar business; and will furnish to the Lenders, upon
request from the Agent, information presented in reasonable detail as to the
insurance so carried; provided that, in lieu of any such insurance, QCII and any
Loan Party may maintain a system or systems of self-insurance and reinsurance
which will accord with sound practices of similarly situated corporations
maintaining such systems and with respect to which it will maintain adequate
insurance reserves, all in accordance with generally accepted accounting
principles and in accordance with sound insurance principles and practice.
Section 5.03. Maintenance of Existence. Each QwestDex Company will
preserve, renew and keep in full force and effect their respective corporate
existence and their respective material rights, privileges, franchises and
licenses necessary or desirable in the normal conduct of business.
Section 5.04. Compliance with Laws. Each QwestDex Company will comply
in all material respects with all applicable laws, ordinances, rules,
regulations, and requirements of governmental authorities (including, without
limitation, Environmental Laws and ERISA and the rules and regulations
thereunder), except where the necessity of compliance therewith is contested in
good faith by appropriate proceedings and for which adequate reserves in
conformity with generally accepted accounting principles have been established.
Section 5.05. Inspection of Property, Books and Records. Each QwestDex
Company will keep proper books of record and account in which full, true and
correct entries shall be made of all dealings and transactions in relation to
its business and activities; and will permit representatives of any Lender at
such Lender's expense to visit and inspect any of their respective properties,
to examine and make abstracts from any of their respective books and records and
to discuss their respective affairs, finances and accounts with their respective
officers, employees and independent public accountants, all at such reasonable
times and as often as may reasonably be desired.
Section 5.06. Financial Covenants. (a) Interest Coverage. On the last
day of any fiscal quarter of Holdings, the ratio of (i) Consolidated EBITDA to
(ii) Consolidated Adjusted Interest Expense, in each case for the four
consecutive fiscal quarters of Holdings ended on such date, will not be less
than (x) if such date is prior to the date of consummation of a Qualifying
Dexter Asset Sale, 8.75 to 1.0 and (ii) if such date is on or after the date of
consummation of a Qualifying Dexter Asset Sale, 4.75 to 1.0. For purposes of any
determination hereunder prior to the first anniversary of the Borrowing Date,
Consolidated Adjusted Interest Expense for any period of four consecutive fiscal
quarters shall be calculated by annualizing the amount of Consolidated Adjusted
Interest Expense for the period from the Borrowing Date to the last day of such
period of four consecutive fiscal quarters, such annualization on a simple
arithmetic basis.
37
(b) Maximum Debt to EBITDA. The Senior Debt Ratio will not at any
date exceed (i) if such date is prior to the date of consummation of a
Qualifying Dexter Asset Sale, 1.25 to 1.0 and (ii) if such date is on or after
the date of consummation of a Qualifying Dexter Asset Sale, 1.75 to 1.0. For
purposes of calculating Consolidated EBITDA for any period of four consecutive
fiscal quarters during, or after, which a Qualifying Dexter Asset Sale is
consummated, Consolidated EBITDA will be calculated on a pro forma basis as if
the sale occurred on the first day of such period.
(c) Minimum Net Worth. Consolidated Net Worth will not at any date
be less than (i) if such date is prior to the date of consummation of a
Qualifying Dexter Asset Sale, an amount equal to Consolidated Net Worth as at
June 30, 2002 minus $150,000,000 and (ii) if such date is on or after the date
of consummation of a Qualifying Dexter Asset Sale, such amount as may be
mutually agreed upon by the Borrower and the Agent as appropriately giving
effect to such Qualifying Dexter Asset Sale and application of the proceeds
thereof, provided that in the absence of such agreement, such amount shall be
reasonably determined by the Agent as appropriately giving effect to such
Qualifying Dexter Asset Sale and application of the proceeds thereof, so long as
the "cushion" (i.e., the difference between actual Consolidated Net Worth and
minimum required Consolidated Net Worth, expressed as a percentage of actual
Consolidated Net Worth) is no less than it was as of June 30, 2002.
Section 5.07. Negative Pledge. No QwestDex Company will create, assume
or suffer to exist any Lien on any asset now owned or hereafter acquired by it,
or on any Collateral, except:
(a) Liens existing on the Closing Date and listed in Schedule
5.07;
(b) any Lien on any asset of any QwestDex Company (a "Purchase
Money Obligor") securing Purchase Money Debt incurred by such Purchase Money
Obligor in connection with the purchase of such asset and permitted under
Section 5.12, provided that such Lien attaches to such asset concurrently with
or within 180 days after the incurrence of such Purchase Money Debt;
(c) any Lien arising out of the refinancing, replacement,
extension, renewal or refunding of any Debt secured by any Lien permitted by any
of the foregoing clauses of this Section, provided that such Debt is not
increased and is not secured by any additional assets and such refinancing,
replacement, extension, renewal or refunding is on terms and conditions
(including the terms, conditions, status and ranking of any such Lien) not
materially less favorable to the QwestDex Companies and the Lenders party hereto
than the Debt being refinanced;
(d) Liens arising in the ordinary course of business which (i) do
not secure Debt, (ii) do not secure any obligation in an amount exceeding
$50,000,000 and (iii) do not in the aggregate materially detract from the value
of its assets or materially impair the use thereof in the operation of its
business;
(e) (i) Liens ("Facility Liens") on the Collateral pursuant to the
Collateral Documents securing the Term Secured Obligations, (ii) Liens on the
Collateral consisting of the Corp. Equity Collateral and the QSC Asset
Collateral securing the Revolver Secured Obligations, which Liens may be senior
to the Facility Liens, as provided in the Security and Pledge Agreement (or on
other terms and conditions reasonably approved by the Agent), (iii) Liens on the
Collateral (other than the Corp. Equity Collateral and the QSC Asset Collateral)
securing the Revolver Secured Obligations so long as the Liens described in this
clause (iii) shall be junior and subordinated to the Facility Liens, as provided
in the Security and Pledge Agreement (or on other terms and
38
conditions reasonably approved by the Agent), (iv) Liens on the QwestDex Asset
Collateral securing indemnity obligations of QCII, QSC and the Borrower under
the QwestDex Purchase Agreements in an aggregate amount not to exceed
$100,000,000, so long as the Liens described in this clause (iv) shall secure
Dex Purchaser Secured Obligations and be junior and subordinated to the Facility
Liens and to the Liens described in clause (iii) as provided in the Security and
Pledge Agreement (or on other terms and conditions reasonably approved by the
Agent); and (v) other Liens on the Collateral permitted by the QSC Bank
Facility, so long as such Liens shall secure Additional Permitted Secured
Obligations and be junior and subordinated to the Facility Liens as provided in
the Security and Pledge Agreement (or on other terms and conditions reasonably
approved by the Agent); and
(f) Liens not permitted by the foregoing clauses of this Section
securing obligations in an aggregate amount at any time outstanding not
exceeding $10,000,000.
Section 5.08. Consolidations, Mergers and Sales of Assets. (a) No
QwestDex Company will merge or consolidate with or into any other Person;
provided that any wholly owned Subsidiary of the Borrower formed pursuant to an
Excluded Asset Transfer may be merged with and into the Borrower, with the
Borrower as the surviving corporation, if the related Asset Sale is not
consummated.
(b) No QwestDex Company will sell, lease or otherwise transfer,
directly or indirectly, all or substantially all of its assets to any other
Person; provided that nothing in this subsection (b) shall be construed to
prohibit the sale of the Dexter Assets and the Xxxxxx Assets: (i) pursuant to
and in accordance with the terms of the QwestDex Purchase Agreements or (ii)
otherwise for fair value; provided further that the Loans, together with all
other amounts payable under this Agreement, shall be paid in full substantially
simultaneously with the consummation of any such sale of all or substantially
all of the assets of the QwestDex Companies.
(c) No QwestDex Company shall consummate any Asset Sale unless at
least 75% of the consideration therefor shall consist of cash payable at
closing.
Section 5.09. Use Of Proceeds. The proceeds of the Loans made under
this Agreement will be used by the Borrower solely as set forth in the Use of
Proceeds Certificate. None of such proceeds will be used, directly or
indirectly, in violation of any applicable law or regulation, and no use of such
proceeds will include any use for the purpose, whether immediate, incidental or
ultimate, of buying or carrying any Margin Stock.
Section 5.10. Restricted Payments. No QwestDex Company will declare or
make, or agree to pay or make, directly or indirectly, any Restricted Payment if
at the time a Trigger Event exists; provided the Borrower and Holdings may each
39
make Restricted Payments to the extent required to permit QCII and its
Subsidiaries to make mandatory interest and principal payments in respect of (i)
Debt of QCII (including Debt of Subsidiaries Guaranteed by QCII) outstanding on
the Closing Date, pursuant to the terms thereof in effect on the Closing Date
and (ii) Debt of QCII (including Debt of Subsidiaries Guaranteed by QCII) issued
in exchange therefor as permitted by Section 5.12 of the QSC Bank Facility,
pursuant to the terms thereof, in each case as such terms may be modified in
accordance with the terms of the QSC Bank Facility in effect on the Closing
Date. Nothing contained in this Agreement is intended to restrict or otherwise
limit the QwestDex Companies from continuing their historical cash management
practices (which include, without limitation, sweeping cash of the QwestDex
Companies from the accounts of the QwestDex Companies to the accounts of QCII or
any of its Subsidiaries on a periodic basis and making investments in, or other
advances of funds to, any other QCII or any of its Subsidiaries) except at any
time during which a Trigger Event exists.
Section 5.11. Transactions With Affiliates. No QwestDex Company will
enter into any transaction of any kind with any of its Affiliates, whether or
not in the ordinary course of business, other than on fair and reasonable terms
substantially favorable to such QwestDex Company as would be obtainable by such
QwestDex Company at the time in a comparable arm's length transaction with a
Person other than an Affiliate; provided that the foregoing restriction shall
not apply to (i) transactions involving payments made pursuant to Section 5.10,
(ii) Permitted Tax Payments and (iii) transactions otherwise permitted by this
Agreement entered into in the ordinary course of business consistent with past
practices.
Section 5.12. Limitations on Debt. No QwestDex Company will create,
incur, assume or permit to exist any Debt, except:
(a) Debt created under the Loan Documents;
(b) Debt consisting of a Guarantee of a Debt of QSC incurred under
the QSC Bank Facility; provided that such Guarantee shall be junior and
subordinated to the obligations of the Borrower and Holdings under the Loan
Documents as provided in the QSC Bank Facility (as in effect on the date
hereof);
(c) Debt outstanding on the Closing Date (including Intercompany
Debt) and listed in Schedule 5.12, and any extensions, renewals, refinancings,
amendments or replacements of any such Debt; provided that any such extension,
renewal, refinancing, amendment or replacement of any such Debt is on terms and
conditions no less favorable in any material respect to the QwestDex Companies
and the Lenders party hereto than the Debt being refinanced;
(d) Debt evidenced by the QwestDex Inc. Intercompany Note not to
exceed $100,000,000; and
40
(e) Purchase Money Debt in an aggregate amount up to $10,000,000;
provided that any Intercompany Debt (including Debt outstanding on the Closing
Date) shall be unsecured and subordinated to Debt under the Loan Documents on
terms and conditions reasonably satisfactory to the Agent.
Section 5.13. Limitations on Investments; Loans, Advances, Guarantees
and Acquisitions. No QwestDex Company will purchase, hold or acquire (including
pursuant to any merger with any Person that was not a wholly owned Subsidiary
before such merger) any Equity Interest in or evidence of indebtedness or other
security (including any option, warrant or other right to acquire any of the
foregoing) of, make, hold or permit to exist any loan or advance to, Guarantee
any obligation of, or make, hold or permit to exist any investment or other
interest in, any other Person, or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person
constituting a business unit, except:
(a) Permitted Investments;
(b) investments existing on the Closing Date and listed in
Schedule 5.13;
(c) investments (i) by Holdings in Equity Interests in the
Borrower and (ii) by the Borrower in Equity Interests in wholly-owned
Subsidiaries pursuant to an Excluded Asset Transfer; provided that any such
Equity Interest shall be pledged pursuant to the Security and Pledge Agreement
to the extent required thereunder;
(d) investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(e) interest rate swap, cap or collar agreements or other similar
agreements or arrangements entered into as a bona fide hedge in respect of the
Tranche A Loans;
(f) instruments or assets received as consideration for an Asset
Sale as permitted by Section 5.08(c); and
(g) investments not otherwise permitted under clauses (a) through
(f) of this Section 5.13, not to exceed at any time an aggregate amount of
$5,000,000.
Section 5.14. Further Assurances Regarding Collateral and Guaranty
Requirement. Each Loan Party will execute and deliver any and all further
documents, financing statements, agreements and instruments, and take all such
further actions (including the filing and recording of financing statements,
fixture filings, mortgages, deeds of trust and other documents), that may be
required
41
under any applicable law, or that the Agent or the Required Lenders may
reasonably request, to cause the Collateral and Guaranty Requirement to be and
remain satisfied, all at the Borrower's expense. The Loan Parties will provide
to the Agent, from time to time upon request, evidence reasonably satisfactory
to the Agent as to the perfection and priority of the Liens created or intended
to be created by the Collateral Documents.
Section 5.15. QSC Bank Facility Covenants. QSC agrees to perform for
the benefit of the Agent and the Lenders each of its covenants set forth in
Article 5 of the QSC Bank Facility, a copy of which has been furnished to each
of the Lenders, which provisions, together with related definitions and
ancillary provisions, are hereby incorporated herein as if fully set forth
herein. Any amendment, supplement or waiver thereto or thereunder shall be
effective for purposes of this Agreement, provided that any consideration
granted to the Lenders party to the QSC Bank Facility in connection with such
amendment shall also be granted to the Lenders party hereto.
ARTICLE 6
DEFAULTS
Section 6.01. Events of Default. If one or more of the following
events shall have occurred and be continuing:
(a) any principal of any Loan shall not be paid when due, or any
interest, any fees or any other amount payable hereunder shall not be paid
within five days of the due date thereof;
(b) any Loan Party shall fail to observe or perform any covenant
contained in Section 5.01(d) or Sections 5.06 to 5.13, inclusive;
(c) any Loan Party shall fail to observe or perform any covenant
or agreement contained in any Loan Document (other than those covered by clause
(a) or (b) above) for 30 days after the earlier of a senior officer's knowledge
of such failure or written notice thereof has been given to the Borrower by the
Agent at the request of any Lender;
(d) any representation, warranty, certification or statement made
by any Loan Party in any Loan Document or in any certificate, financial
statement or other document delivered pursuant thereto (including without
limitation the Use of Proceeds Certificate) shall prove to have been incorrect
in any material respect when made (or deemed made);
(e) QSC or any Subsidiary shall fail to make any payment or
payments, in the aggregate in excess of $100,000,000, in respect of any Material
Debt when due or within any applicable grace period;
42
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables or permits the
holder thereof to accelerate the maturity thereof or any "Event of Default" (as
defined in the QSC Bank Facility) exists which has not been waived by the Banks
under the QSC Bank Facility or the holders of such other Material Debt, as the
case may be, in accordance with the terms thereof;
(g) Corp. or any Loan Party shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize or otherwise
acquiesce in any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced
against Corp. or any Loan Party seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against Corp. or any Loan Party under the federal
bankruptcy laws as now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an
amount or amounts aggregating in excess of $100,000,000 which it shall have
become liable to pay under Title IV of ERISA; or notice of intent to terminate a
Material Plan shall be filed under Title IV of ERISA by any member of the ERISA
Group, any plan administrator or any combination of the foregoing; or the PBGC
shall institute proceedings under Title IV of ERISA to terminate, to impose
liability (other than for premiums under Section 4007 of ERISA) in respect of,
or to cause a trustee to be appointed to administer any Material Plan; or a
condition specified in Section 4042(a) of ERISA shall exist by reason of which
the PBGC would be entitled to obtain a decree adjudicating that any Material
Plan must be terminated; or there shall occur a complete or partial withdrawal
from, or a default, within the meaning of Section 4219(c)(5) of ERISA, with
respect to, one or more Multiemployer Plans which could cause one or more
members of the ERISA Group to incur a current payment obligation in excess of
$100,000,000;
(j) a judgment or order for the payment of money shall be rendered
in excess of (i) $100,000,000 (excluding Insured Judgment Amounts) against QSC
or any Subsidiary (except Holdings and its Subsidiaries) or (ii) $50,000,000
(excluding Insured Judgment Amounts) against Holdings or any of its
43
Subsidiaries, and such judgment or order shall be enforceable and shall continue
unsatisfied, in effect and unstayed for a period of 60 days (or such longer
period of time after which the judgment holder may cause the creation of Liens
against or seizure of any property of QSC or such Subsidiary) (it being
understood that in any event an administrative order of a public utility
commission shall not constitute an "order" for purposes of this clause (j) so
long as (x) no one is seeking to enforce such order in an action, suit or
proceeding before a court and (y) reserves in the full amount of the cost of
such order are maintained on the books of QSC and its Subsidiaries);
(k) any Guarantor shall repudiate in writing any of its
obligations under Article 9 or any such obligation shall be unenforceable
against any Guarantor in accordance with its terms, or QSC or any of its
Subsidiaries shall so assert in writing;
(l) any Lien purported to be created under any Collateral Document
shall cease to be, or shall be asserted by QSC or any of its Subsidiaries not to
be, a valid and perfected Lien on any Collateral, with the priority required by
the applicable Collateral Document, except (i) as a result of a sale or other
disposition of the applicable Collateral in a transaction permitted under the
Loan Documents, (ii) as a result of the Agent's failure to maintain possession
of any stock certificates, promissory notes or other documents delivered to it
under the Security and Pledge Agreement or (iii) as a result of the operation of
Section 2(m) of the Security and Pledge Agreement, so long as each Lien Grantor
shall have complied with its obligations thereunder; or
(m) a Change of Control shall occur;
then, and in every such event, the Agent shall (i) if requested by Lenders
having more than 50% in aggregate amount of the Commitments, by notice to the
Borrower terminate the Commitments and they shall thereupon terminate, and/or
(ii) if requested by Lenders holding Loans evidencing more than 50% in aggregate
principal amount of the Loans, by notice to the Borrower declare the Loans
(together with accrued interest thereon) to be, and the Loans shall thereupon
become, immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by QSC, Holdings and
the Borrower; provided that in the case of any of the Events of Default
specified in clause (g) or (h) above with respect to Holdings, the Borrower or
QSC, without any notice to the Borrower or any other act by the Agent or the
Lenders, the Commitments shall thereupon automatically terminate and the Loans
(together with accrued interest thereon) shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower.
Section 6.02. Notice of Default. The Agent shall give notice to the
Borrower under Section 6.01(c) promptly upon being requested to do so by any
Lender and shall thereupon notify all the Lenders thereof.
44
ARTICLE 7
THE AGENT
Section 7.01. Appointment and Authorization. Each Lender irrevocably
appoints and authorizes the Agent to take such action (including, without
limitation, entering into the Security and Pledge Agreement) as agent on its
behalf and to exercise such powers under the Loan Documents as are delegated to
the Agent by the terms thereof, together with all such powers as are reasonably
incidental thereto.
Section 7.02. Agent and Affiliates. Bank of America, N.A., and its
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with each of
QCII, the Borrower or any Subsidiary or Affiliate of QCII or the Borrower (each,
a "Qwest Entity") as though Bank of America, N.A., were not the Agent hereunder
and without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America , N.A., or its Affiliates may
receive information regarding any Qwest Entity (including information that may
be subject to confidentiality obligations in favor of such Qwest Entity) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, Banc of America Bridge LLC shall
have the same rights and powers under this Agreement as any other Lender and may
exercise such rights and powers as though it were not an Affiliate of the Agent.
Section 7.03. Action by Agent. The obligations of the Agent under the
Loan Documents are only those expressly set forth therein. Without limiting the
generality of the foregoing, the Agent shall not be required to take any action
with respect to any Default, except as expressly provided in the Loan Documents.
The Agent shall not have or be deemed to have any fiduciary relationship with
any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Agent. Without limiting the generality
of the foregoing sentence, the use of the term "agent" in any Loan Document with
reference to the Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
Section 7.04. Consultation with Experts. The Agent may consult with
legal counsel (who may be counsel for any Loan Party), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
45
Section 7.05. Delegation of Duties. The Agent may execute any of its
duties under the Loan Documents by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. The
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.
Section 7.06. Liability of Agent. Neither the Agent nor any of its
Affiliates nor any of their respective directors, officers, agents or employees
shall be liable for any action taken or not taken by it in connection with any
Loan Document (i) with the consent or at the request of the Required Lenders or
(ii) in the absence of its own gross negligence or willful misconduct. Neither
the Agent nor any of its Affiliates nor any of their respective directors,
officers, agents or employees shall be responsible for or have any duty to
ascertain, inquire into or verify (i) any statement, warranty or representation
made in connection with any Loan Document or any borrowing hereunder; (ii) the
performance or observance of any of the covenants or agreements of any Loan
Party; (iii) the satisfaction of any condition specified in Article 3, except
receipt of items required to be delivered to the Agent; (iv) the existence or
sufficiency of the Collateral or (v) the validity, effectiveness or genuineness
of any Loan Document or any other instrument or writing furnished in connection
therewith. None of the Agent, its Affiliates and their respective directors,
officers, agents and employees shall be under any obligation to any Lender or
participant to inspect the properties, books or records of any Qwest Entity. The
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or other writing (which may be a bank wire,
telex or similar writing) believed by it to be genuine or to be signed by the
proper party or parties.
Section 7.07. Indemnification. Each Lender shall, ratably in
accordance with its Credit Exposure, indemnify the Agent, its Affiliates and
their respective directors, officers, agents and employees (to the extent not
reimbursed by the Loan Parties) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from such indemnitees' gross negligence or willful
misconduct) that such indemnitees may suffer or incur in connection with the
Loan Documents or any action taken or omitted by such indemnitees thereunder. No
action taken with the consent or at the request of the Required Lenders shall be
deemed to constitute gross negligence or willful misconduct for purposes of this
Section.
Section 7.08. Credit Decision; Disclosure of Information by Agent.
Each Lender acknowledges that none of the Agent, its Affiliates and their
respective directors, officers, agents and employees (each, an "Agent-Related
Person") has made any representation or warranty to it, and that no act by the
Agent hereafter taken, including any consent to and acceptance of any assignment
or review of the affairs of any Qwest Entity, shall be deemed to constitute any
representation or warranty by the Agent or any other Person to any Lender as to
any matter, including whether Agent-Related Persons have disclosed material
information in
46
their possession. Each Lender represents to the Agent that it has, independently
and without reliance upon any Agent-Related Person and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Qwest Entities, and all applicable
bank or other regulatory laws relating to the transactions contemplated hereby,
and made its own decision to enter into this Agreement and to extend credit
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigations as it deems necessary to inform
itself as to the business, prospects, operations, property, financial and other
condition and creditworthiness of the Qwest Entities. Except for the notices,
reports and other documents expressly required to be furnished to the Lenders by
the Agent herein, the Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of any of the Qwest Entities which may come into the possession
of any Agent-Related Person.
Section 7.09. Successor Agent. The Agent may resign as Agent at any
time by giving notice thereof to the Lenders and QSC. Upon any such resignation,
the Required Lenders shall have the right to appoint a successor Agent (with the
consent of QSC, such consent not to be unreasonably withheld or delayed). If no
successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the retiring Agent gives
notice of resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent (with the consent of QSC, such consent not to be
unreasonably withheld), which shall be a commercial bank organized or licensed
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $400,000,000. Upon the
acceptance of its appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the rights
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Article shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent. If no successor agent has accepted appointment as Agent by the date which
is 30 days following a retiring Agent's notice of resignation, the retiring
Agent's resignation shall at its election nevertheless thereupon become
effective and the Lenders shall perform all of the duties of the Agent hereunder
until such time, if any, as the Required Lenders appoint a successor agent as
provided above. The Agent, if it so elects, may resign as administrative agent
but not collateral agent or vice versa, and if it so elects then the provisions
of this Section 7.09 and the rest of this Article 7 shall apply separately to
each of those separate capacities of the Agent.
Section 7.10. Agent's Fee. QSC and the Borrower shall pay to the Agent
(or its Affiliates) for their own accounts fees in the amounts and at the times
47
previously agreed upon between QSC, the Borrower and the Agent (or its
Affiliates).
ARTICLE 8
CHANGES IN CIRCUMSTANCES
Section 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period for any
Euro-Dollar Loan:
(a) the Agent determines (which determination will be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted London Interbank Offered Rate for such Interest
Period, or
(b) in the case of Euro-Dollar Loans, Lenders having 50% or more
of the aggregate amount of the Euro-Dollar Loans advise the Agent that the
Adjusted London Interbank Offered Rate as determined by the Agent will not
adequately and fairly reflect the cost to such Lenders of funding their
Euro-Dollar Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Lenders,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, (i) the obligations of the Lenders to
make Euro-Dollar Loans or to convert outstanding Loans into Euro-Dollar Loans
shall be suspended and (ii) each outstanding Euro-Dollar Loan shall be converted
into a Domestic Loan on the last day of the then current Interest Period
applicable thereto. Unless the Borrower notifies the Agent at least two Domestic
Business Days before the date of any Euro-Dollar Borrowing for which the Notice
of Borrowing has previously been given that it elects not to borrow on such
date, such Borrowing shall instead be made as a Domestic Borrowing.
Section 8.02. Illegality. If, on or after the date of this Agreement,
the adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Euro-Dollar Lending Office) with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency shall
make it unlawful or impossible for any Lender (or its Euro-Dollar Lending
Office) to make, maintain or fund its Euro-Dollar Loans and such Lender shall so
notify the Agent, the Agent shall forthwith give notice thereof to the other
Lenders and the Borrower, whereupon until such Lender notifies the Borrower and
the Agent that the circumstances giving rise to such suspension no longer exist,
the obligation of such Lender to make Euro-Dollar Loans, or to convert
outstanding Loans into Euro-Dollar Loans, shall be suspended. Before giving any
notice to the Agent pursuant to this Section, such Lender shall designate a
different Euro-Dollar
48
Lending Office if such designation will avoid the need for giving such notice
and will not, in the judgment of such Lender, be otherwise disadvantageous to
such Lender. If such notice is given, each Euro-Dollar Loan of such Lender then
outstanding shall be converted to a Domestic Loan either (a) on the last day of
the then current Interest Period applicable to such Euro-Dollar Loan if such
Lender may lawfully continue to maintain and fund such Loan to such day or (b)
immediately if such Lender shall determine that it may not lawfully continue to
maintain and fund such Loan to such day.
Section 8.03. Increased Cost and Reduced Return. (a) If on or after
the date hereof, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof, or compliance by any Lender
(or its Applicable Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency shall impose, modify or deem applicable any reserve (including, without
limitation, any such requirement imposed by the Board of Governors of the
Federal Reserve System with respect to any Euro-Dollar Loan any such requirement
included in an applicable Euro-Dollar Reserve Percentage), special deposit,
insurance assessment or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Lender (or its Applicable Lending
Office) or shall impose on any Lender (or its Applicable Lending Office) or on
the United States market for certificates of deposit or the London interbank
market any other condition affecting its Euro-Dollar Loans, its Note or its
obligation to make Euro-Dollar Loans and the result of any of the foregoing is
to increase the cost to such Lender (or its Applicable Lending Office) of making
or maintaining any Euro-Dollar Loan, or to reduce the amount of any sum received
or receivable by such Lender (or its Applicable Lending Office) under this
Agreement or under its Note with respect thereto, by an amount deemed by such
Lender to be material, then, within 15 days after demand by such Lender (with a
copy to the Agent), the Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender for such increased cost or reduction.
(b) If any Lender shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any Governmental Authority
charged with the interpretation or administration thereof, or any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on capital of such Lender (or its Parent)
as a consequence of such Lender's obligations hereunder to a level below that
which such Lender (or its Parent) could have achieved but for such adoption,
change, request or directive (taking into consideration its policies with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time, within 15
49
days after demand by such Lender (with a copy to the Agent), the Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender (or its Parent) for such reduction.
(c) Each Lender will promptly notify the Borrower and the Agent of
any event of which it has knowledge, occurring after the date hereof, which will
entitle such Lender to compensation pursuant to this Section and will designate
a different Applicable Lending Office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the judgment of
such Lender, be otherwise disadvantageous to such Lender. A certificate of any
Lender claiming compensation under this Section and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive in the absence
of manifest error. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.
Section 8.04. (a) Taxes. Any and all payments by any Loan Party to or
for the account of any Lender or the Agent under any Loan Document shall be made
free and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, (x) in the case of each Lender and
the Agent, taxes imposed on its income or profits, and franchise taxes imposed
on it, by the jurisdiction under the laws of which such Lender or the Agent (as
the case may be) is organized or any political subdivision thereof, (y) in the
case of each Lender, taxes imposed on its income or profits, and franchise or
similar taxes imposed on it, by the jurisdiction of such Lender's Applicable
Lending Office or any political subdivision thereof, taxes that are imposed by
any jurisdiction by reason of such Lender doing or having done business in such
jurisdiction other than solely as a result of the Loan Documents or any
transaction contemplated thereby, and (z) in the case of each Lender and the
Agent, any branch profits taxes imposed by the United States or any similar tax
imposed by any other jurisdiction in which such Lender or the Agent is organized
or in which its Applicable Lending Office is located or any political
subdivision thereof (all such non-excluded taxes, duties, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If any Loan Party shall be required by law to deduct any Taxes from
or in respect of any sum payable under any Loan Document to any Lender or the
Agent, (i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section 8.04) such Lender or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Person shall make such deductions, (iii) such
Person shall pay the full amount deducted to the relevant taxation authority or
other authority in accordance with applicable law and (iv) such Person shall
furnish to the Agent, at its address referred to in Section 10.01, the original
or a certified copy of a receipt evidencing payment thereof.
(b) In addition, each Loan Party agrees to pay any present or
future stamp or documentary taxes and any other excise or property taxes, or
charges or
50
similar levies which arise from any payment made under any Loan Document or from
the execution or delivery of, or otherwise with respect to, any Loan Document
(hereinafter referred to as "Other Taxes").
(c) Each Loan Party agrees to indemnify each Lender and the Agent
for the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section 8.04) paid by such Lender or the Agent (as the case may be)
and any liability (including penalties, interest and expenses) arising therefrom
or with respect thereto; provided that the indemnification obligation under this
Section 8.04(c) shall be only with respect to Taxes, Other Taxes and liabilities
related to payments made by any Loan Party under any Loan Document. This
indemnification shall be made within 15 days from the date such Lender or the
Agent (as the case may be) makes written demand therefor.
(d) Each Lender organized under the laws of a jurisdiction outside
the United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Lender listed on the signature pages hereof, on or
prior to the date on which it becomes a Lender in the case of each other Lender,
on or prior to the date on which any such Lender grants any participating
interest pursuant to Section 10.06 or otherwise ceases to act for its own
account with respect to any portion of any sums payable to it under this
Agreement, and from time to time thereafter if requested in writing by the
Borrower (but only so long as such Lender remains lawfully able to do so), shall
provide QSC with Internal Revenue Service form X-0XXX, X-0XXX and/or W-8IMY, as
appropriate, or any successor form prescribed by the Internal Revenue Service
(together with any form, documentation or information such Lender is required or
chooses to transmit with any such forms), certifying that such Lender is
entitled to benefits under an income tax treaty to which the United States is a
party which reduces the rate of withholding tax on payments of interest or
certifying that the income receivable pursuant to this Agreement is effectively
connected with the conduct of a trade or business in the United States and/or
certifying as provided on Form W-8IMY. If the form provided by a Lender at the
time such Lender first becomes a party to this Agreement indicates a United
States interest withholding tax rate in excess of zero, withholding tax at such
rate shall be considered excluded from "Taxes" as defined in Section 8.04(a)
imposed by the United States.
(e) For any period with respect to which a Lender has failed to
provide the Borrower with the appropriate form pursuant to Section 8.04(d)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Lender shall not be entitled to indemnification under Section 8.04(a) with
respect to Taxes imposed by the United States; provided, however, that should a
Lender, which is otherwise exempt from or subject to a reduced rate of
withholding tax, become subject to Taxes because of its failure to deliver a
form required hereunder, the Borrower shall take such steps as such Lender shall
reasonably request to assist such Lender to recover such Taxes.
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(f) If any Loan Party is required to pay additional amounts to or
for the account of any Lender pursuant to this Section 8.04, then such Lender
will change the jurisdiction of its Applicable Lending Office so as to eliminate
or reduce any such additional payment which may thereafter accrue if such
change, in the judgment of such Lender, is not otherwise disadvantageous to such
Lender.
Section 8.05. Domestic Loans Substituted for Affected Euro-Dollar
Loans. If (i) the obligation of any Lender to make Euro-Dollar Loans to the
Borrower has been suspended pursuant to Section 8.02 or (ii) any Lender has
demanded compensation under Section 8.03 with respect to its Euro-Dollar Loans
and the Borrower shall, by at least five Euro-Dollar Business Days' prior notice
to such Lender through the Agent, have elected that the provisions of this
Section shall apply to such Lender, then, unless and until such Lender notifies
the Borrower that the circumstances giving rise to such suspension or demand for
compensation no longer exist:
(b) all Loans which would otherwise be made by such Lender as (or
continued as or converted into) Euro-Dollar Loans shall instead be Domestic
Loans (on which interest and principal shall be payable contemporaneously with
the related Euro-Dollar Loans of the other Lenders), and
(c) after each of its Euro-Dollar Loans has been repaid (or
converted to a Domestic Loan), all payments of principal which would otherwise
be applied to repay such Euro-Dollar Loans shall be applied to repay its
Domestic Loans instead.
If such Lender notifies the Borrower that the circumstances giving rise to such
notice no longer apply, the principal amount of each such Domestic Loan shall be
converted into a Euro-Dollar Loan on the first day of the next succeeding
Interest Period applicable to the related Euro-Dollar Loans of the other
Lenders.
Section 8.06. Substitution of Lender. If (i) the obligation of any
Lender to make Euro-Dollar Loans has been suspended pursuant to Section 8.02,
(ii) any Lender has demanded compensation under Section 8.03 or (iii) any Lender
has not signed an amendment or waiver which must be signed by all the Lenders to
become effective, and such amendment or waiver has been signed by the Required
Lenders, the Borrower shall have the right, with the assistance of the Agent, to
seek a mutually satisfactory substitute institution or institutions (which may
be one or more of the Lenders) to purchase the Loans of such Lender (by paying
to such Lender the principal amount of such Loans, together with accrued
interest thereon and any other amounts payable to such Lender hereunder) or
assume the Commitment (if any) of such Lender.
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ARTICLE 9
GUARANTEES
Section 9.01. The Guaranty. Each Guarantor hereby unconditionally
guarantees the full and punctual payment (whether at stated maturity, upon
acceleration or otherwise) of its Guaranteed Obligations. Upon failure by the
Borrower to pay or perform punctually any Guaranteed Obligation, each Guarantor
shall forthwith on demand pay or perform such Guaranteed Obligation in the
manner specified in the relevant Loan Document.
Section 9.02. Guaranty Unconditional. The obligations of each
Guarantor hereunder shall be unconditional, irrevocable and absolute and,
without limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by:
(i) any extension, renewal, settlement, compromise,
waiver or release in respect of any obligation of any other Loan Party
under any Loan Document, by operation of law or otherwise;
(ii) any modification or amendment of or supplement to any
Loan Document;
(iii) any release, impairment, non-perfection or invalidity
of any direct or indirect security for any obligation of any other Loan
Party under any Loan Document;
(iv) any change in the corporate existence, structure or
ownership of any other Loan Party or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting any other Loan
Party or any of its assets or any resulting release or discharge of any
obligation of any other Loan Party contained in any Loan Document;
(v) the existence of any claim, set-off or other rights
which such Guarantor may have at any time against any other Loan Party,
the Agent, any Lender or any other Person, whether in connection
herewith or any unrelated transactions, provided that nothing herein
shall prevent the assertion of any such claim by separate suit or
compulsory counterclaim;
(vi) any invalidity or unenforceability relating to or
against any other Loan Party for any reason of any Loan Document, or
any provision of applicable law or regulation purporting to prohibit
the payment by any other Loan Party of the principal of or interest on
any Note or any other amount payable by it under the Loan Document; or
(vii) any other act or omission to act or delay of any kind
by any other Loan Party, the Agent, any Lender or any other Person or
any other circumstance whatsoever which might, but for the provisions
of this
53
paragraph, constitute a legal or equitable discharge of such
Guarantor's obligations hereunder.
Section 9.03. Discharge Only upon Payment in Full; Reinstatement in
Certain Circumstances. Each Guarantor's obligations hereunder shall remain in
full force and effect until the Commitments shall have terminated and the
principal of and interest on the Notes and all other amounts payable by the
Borrower under the Loan Documents shall have been indefeasibly paid in full. If
at any time any payment of the principal of or interest on any Note or any other
amount payable by the Borrower under the Loan Documents is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or reorganization
of the Borrower or otherwise, each Guarantor's obligations hereunder with
respect to such payment shall be reinstated at such time as though such payment
had been due but not made at such time.
Section 9.04. Waiver by Guarantors. Each Guarantor irrevocably waives
acceptance hereof, presentment, demand, protest and any notice not provided for
herein, as well as any requirement that at any time any action be taken by any
Person against any other Loan Party or any other Person.
Section 9.05. Subrogation. Each Guarantor irrevocably waives any and
all rights to which it may be entitled, by operation of law or otherwise, upon
making any payment hereunder to be subrogated to the rights of the payee against
the Borrower with respect to such payment or against any direct or indirect
security therefor, or otherwise to be reimbursed, indemnified or exonerated by
or for the account of the Borrower in respect thereof until (i) the Commitments
shall have terminated and (ii) all Loans and all other obligations under this
Agreement and the other Loan Documents have been paid in full in cash.
Section 9.06. Stay of Acceleration. In the event that acceleration of
the time for payment of any amount payable by the Borrower under the Loan
Documents is stayed upon insolvency, bankruptcy or reorganization of the
Borrower, all such amounts otherwise subject to acceleration under the terms of
this Agreement shall nonetheless be payable by each Guarantor hereunder
forthwith on demand by the Agent made at the request of the Required Lenders.
ARTICLE 10
MISCELLANEOUS
Section 10.01. Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including bank wire, telex,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of any Loan Party party hereto or the Agent, at its address or
facsimile number set forth on the signature pages hereof, (y) in the case of any
Lender, at its address or facsimile number set forth in its Administrative
Questionnaire or (z) in the case of any party, such other address or facsimile
number as such party may hereafter
54
specify for the purpose by notice to the Agent and the Borrower. Each such
notice, request or other communication shall be effective (i) if given by mail,
72 hours after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid, (ii) if given by facsimile
transmission, when such facsimile is transmitted to the facsimile number
specified pursuant to this Section 10.01 and telephonic confirmation of receipt
thereof is received, or (iii) if given by any other means, when delivered at the
address specified in this Section; provided that notices to the Agent under
Article 2 or Article 8 shall not be effective until received.
Section 10.02. No Waivers. No failure or delay by the Agent or any
Lender in exercising any right, power or privilege under any Loan Document shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided in the Loan
Documents shall be cumulative and not exclusive of any rights or remedies
provided by law.
Section 10.03. Expenses; Indemnification. (a) The Borrower shall pay
(i) all reasonable out-of-pocket expenses of the Agent, including reasonable
fees and disbursements of special counsel for the Agent in connection with the
preparation and administration of the Loan Documents, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all out-of-pocket expenses incurred by
the Agent and each Lender, including reasonable fees and disbursements of
counsel, in connection with such Event of Default and collection, bankruptcy,
insolvency and other enforcement proceedings resulting therefrom.
(b) The Borrower agrees to indemnify the Agent and each Lender,
their respective Affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in connection
with any investigative, administrative or judicial proceeding (whether or not
such Indemnitee shall be designated a party thereto) brought or threatened
relating to or arising out of the Loan Documents or any actual or proposed use
of proceeds of Loans hereunder; provided that (i) no Indemnitee shall have the
right to be indemnified hereunder for such Indemnitee's own gross negligence or
willful misconduct as determined by a court of competent jurisdiction and (ii)
the Borrower shall not be liable for any settlement entered into by an
Indemnitee without its consent (which shall not be unreasonably withheld).
(c) Each Indemnitee agrees to give the Borrower prompt written
notice after it receives any notice of the commencement of any action, suit or
proceeding for which such Indemnitee may wish to claim indemnification pursuant
to subsection (b). The Borrower shall have the right, exercisable by giving
written notice within fifteen Domestic Business Days after the receipt of notice
from such
55
Indemnitee of such commencement, to assume, at the Borrower's expense, the
defense of any such action, suit or proceeding; provided, that such Indemnitee
shall have the right to employ separate counsel in any such action, suit or
proceeding and to participate in the defense thereof, but the fees and expenses
of such separate counsel shall be at such Indemnitee's expense unless (1)
Bookmark not defined. the Borrower shall have agreed to pay such fees and
expenses; (2) the Borrower shall have failed to assume the defense of such
action, suit or proceeding or shall have failed to employ counsel reasonably
satisfactory to such Indemnitee in any such action, suit or proceeding; or (3)
such Indemnitee shall have been advised by independent counsel in writing (with
a copy to the Borrower) that there may be one or more defenses available to such
Indemnitee which are in conflict with those available to the Borrower (in which
case, if such Indemnitee notifies the Borrower in writing that it elects to
employ separate counsel at the Borrower's expense, the Borrower shall be
obligated to assume the expense, it being understood, however, that the Borrower
shall not be liable for the fees or expenses of more than one separate firm of
attorneys, which firm shall be designated in writing by such Indemnitee).
Section 10.04. Sharing of Set-offs. Each Lender agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Loan held by it which is greater than the proportion
received by any other Lender in respect of the aggregate amount of principal and
interest due with respect to any Note held by such other Lender, the Lender
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Lenders, and such other
adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Loans held by the Lenders shall be
shared by the Lenders pro rata; provided that nothing in this Section shall
impair the right of any Lender to exercise any right of set-off or counterclaim
it may have and to apply the amount subject to such exercise to the payment of
indebtedness of the Borrower other than its indebtedness hereunder. The Borrower
agrees, to the fullest extent it may effectively do so under applicable law,
that any holder of a participation in a Note, whether or not acquired pursuant
to the foregoing arrangements, may exercise rights of set-off or counterclaim
and other rights with respect to such participation as fully as if such holder
of a participation were a direct creditor of the Borrower in the amount of such
participation.
Section 10.05. Amendments and Waivers; Release of Liens. (a) Any
provision of this Agreement or the Notes may be amended or waived if, but only
if, such amendment or waiver is in writing and is signed by QSC, Holdings, the
Borrower and the Required Lenders (and, if the rights or duties of the Agent are
affected thereby, by the Agent); provided that no such amendment or waiver
shall, unless signed by each Lender directly affected thereby, (i) increase or
decrease the Commitment of any Lender or subject any Lender to any additional
obligation (it being understood that an increase or decrease pursuant to Section
8.06 or 10.06
56
shall not constitute an amendment or waiver for this purpose), (ii) reduce the
principal of or rate of interest on any Loan, (iii) postpone the date fixed for
any payment of principal of or interest on any Loan or for the termination of
any Commitment, (iv) change the provisions of the first sentence of Section
2.11(f) or Section 10.04 in a manner that would alter the pro rata sharing of
payments required thereby or (v) release either Guarantor from its obligations
under Article 9; and provided further that no amendment or waiver shall, unless
signed by each Lender, change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans, or the number of Lenders, which
shall be required for the Lenders or any of them to take any action under this
Section or any other provision of this Agreement.
(b) Any provision of any Collateral Document may be amended or
waived if, but only if, such amendment or waiver is entered into in accordance
with the terms thereof.
(c) Upon consummation of any Asset Sale by a QwestDex Company
(including without limitation pursuant to the QwestDex Purchase Agreements), the
Lien created under the Collateral Documents securing the Term Secured
Obligations on assets subject to such Asset Sale shall terminate in accordance
with Section 27 of the Security and Pledge Agreement.
Section 10.06. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that no Loan Party may
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of all Lenders.
(b) Any Lender may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans, with (and subject to) the written consent of the Agent,
such consent shall not be unreasonably withheld; provided that if a Participant
is a Lender Affiliate or is another Lender, no such consent shall be required.
In the event of any such grant by a Lender of a participating interest to a
Participant, such Lender shall remain responsible for the performance of its
obligations hereunder, and the Loan Parties and the Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement pursuant to which any Lender may
grant such a participating interest shall provide that such Lender shall retain
the sole right and responsibility to enforce the obligations of the Loan Parties
hereunder including, without limitation, the right to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
participation agreement may provide that such Lender will not agree to any
modification, amendment or waiver of this Agreement described in clause (i),
(ii) or (iii) of Section 10.05 without the consent of the Participant. The
Borrower agrees that each Participant shall, to the extent provided in its
participation agreement and subject to subsection (e) below, be entitled to the
benefits of Article 8 with
57
respect to its participating interest. An assignment or other transfer which is
not permitted by subsection (c) or (d) below but which is consented to in
accordance with this subsection (b) shall be given effect for purposes of this
Agreement only to the extent of a participating interest granted in accordance
with this subsection (b).
(c) Any Lender may at any time assign to one or more banks or
other institutions (each an "Assignee") all, or a proportionate part of all, of
its rights and obligations under this Agreement and the Notes, and such Assignee
shall assume such rights and obligations, pursuant to an Assignment and
Assumption Agreement in substantially the form of Exhibit D hereto executed by
such Assignee and such transferor Lender, with (and subject to) the subscribed
consent of the Agent, which consent shall not be unreasonably withheld; provided
that (i) if an Assignee is a Lender Affiliate or is another Lender, no such
consent shall be required and (ii) except in the case of an assignment to a
Lender or a Lender Affiliate, any assignment shall not be less than $1,000,000,
or if less, shall constitute an assignment of all of such Lender's rights and
obligations under this Agreement and the Notes. Upon execution and delivery of
such instrument and payment by such Assignee to such transferor Lender of an
amount equal to the purchase price agreed between such transferor Lender and
such Assignee, such Assignee shall be a Lender party to this Agreement and shall
have all the rights and obligations of a Lender with a Commitment or, if the
Commitments have terminated, Loans as set forth in such instrument of
assumption, and the transferor Lender shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required. Upon the consummation of any assignment pursuant to
this subsection (c), the transferor Lender, the Agent and the Borrower shall
make appropriate arrangements so that, if required, new Notes are issued to the
Assignee. In connection with any such assignment (other than to a Lender
Affiliate), the transferor Lender shall pay to the Agent an administrative fee
for processing such assignment in the amount of $3,500. If the Assignee is not
incorporated under the laws of the United States of America or a state thereof,
it shall deliver to QSC and the Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 8.04.
(d) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement and its Notes
to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release the transferor Lender from its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
Notwithstanding anything to the contrary contained herein, any Lender that is a
Fund may create a security interest in all or any portion of the Loans owing to
it and the Note, if any, held by it to the trustee for holders of obligations
owed, or securities issued, by such Fund as security for such obligations or
securities; provided that unless and until such trustee actually becomes a
Lender in
58
compliance with the other provisions of this Section 10.06, (i) no such pledge
shall release the pledging Lender from any of its obligations under the Loan
Documents and (ii) such trustee shall not be entitled to exercise any of the
rights of a Lender under the Loan Documents even though such trustee may have
acquired ownership rights with respect to the pledged interest through
foreclosure or otherwise.
(e) No Assignee, Participant or other transferee of any Lender's
rights shall be entitled to receive any greater payment under Section 8.03 or
8.04 than such Lender would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with QSC's prior written
consent or by reason of the provisions of Section 8.02, 8.03 or 8.04 requiring
such Lender to designate a different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.
Section 10.07. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. Each Loan Party hereto hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to the Loan
Documents or the transactions contemplated thereby, and irrevocably waives, to
the fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
Section 10.08. Counterparts; Integration; Effectiveness. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof.
Section 10.09. WAIVER OF JURY TRIAL. EACH OF THE LOAN PARTIES PARTY
HERETO, THE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THE LOAN
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.
Section 10.10. Confidentiality. Each of the Agent and the Lenders
agrees to use its reasonable best efforts to keep confidential any information
delivered or made available by or on behalf of the Loan Parties to it (including
without limitation any information obtained through any financial advisor);
provided that nothing herein shall prevent the Agent or any Lender from
disclosing such information (i) to the Agent or any other Lender in connection
with the
59
transactions contemplated hereby, (ii) to its officers, directors, employees,
agents, attorneys and accountants who have a need to know such information in
accordance with customary banking practices and who receive such information
having been made aware of the restrictions set forth in this Section, (iii) upon
the order of any court or administrative agency, (iv) upon the request or demand
of any regulatory agency or authority having jurisdiction over such party, (v)
which has been publicly disclosed (by a Person other than such Agent or Lender),
(vi) which has been obtained from any Person other than QCII and its
Subsidiaries, provided that such Person is not (x) known to it to be bound by a
confidentiality agreement with QCII or its Subsidiaries or any other obligation
not to disclose or (y) known to it to be otherwise prohibited from transmitting
the information to it by a contractual, legal or fiduciary obligation, (vii) in
connection with the exercise of any remedy under the Loan Documents or (viii) to
any actual or proposed participant or assignee of all or any of its rights
hereunder which has agreed in writing to be bound by the provisions of this
Section.
Section 10.11. No Reliance on Margin Stock. Each Lender represents to
the Agent and each of the other Lenders that it in good faith is not relying
upon any Margin Stock as collateral in the extension or maintenance of the
credit provided for in this Agreement.
60
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
QWEST SERVICES CORPORATION
By:
-------------------------------------
Name:
Title:
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Chief Financial Officer
Fax: (000) 000-0000
and:
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: General Counsel
Fax: (000) 000-0000
QWEST DEX HOLDINGS, INC.
By:
-------------------------------------
Name:
Title:
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Chief Financial Officer
Fax: (000) 000-0000
and:
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: General Counsel
Fax: (000) 000-0000
QWEST DEX, INC.
By:
-------------------------------------
Name:
Title:
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Chief Financial Officer
Fax: (000) 000-0000
and:
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: General Counsel
Fax: (000) 000-0000
BANK OF AMERICA, N.A.,
as Administrative Agent
By:
-------------------------------------
Name:
Title:
For notices regarding waivers,
amendments, financial statements, and all
other notices EXCEPT as specified below:
CA5-701-05-19
0000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
For notices regarding borrowings,
interest rate elections, interest rates
and payments:
NC1-001-05-04
000 X. Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
BANK OF AMERICA SECURITIES LLC,
as agent for Bank of America, N.A.
By:
-------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
By:
-------------------------------------
Name:
Title:
ABLECO FINANCE LLC
By:
-------------------------------------
Name:
Title:
BANK ONE, NA
By:
-------------------------------------
Name:
Title:
FARALLON CAPITAL PARTNERS, L.P.
By: Farallon Partners, L.L.C.,
its General Partner
By:
-------------------------------------
Name:
Title:
FARALLON CAPITAL INSTITUTIONAL
PARTNERS, L.P.
By: Farallon Partners, L.L.C.,
its General Partner
By:
-------------------------------------
Name:
Title:
FARALLON CAPITAL INSTITUTIONAL
PARTNERS II, L.P.
By: Farallon Partners, L.L.C.,
its General Partner
By:
-------------------------------------
Name:
Title:
FARALLON CAPITAL INSTITUTIONAL
PARTNERS III, L.P.
By: Farallon Partners, L.L.C.,
as General Partner
By:
-------------------------------------
Name:
Title:
TINICUM PARTNERS, L.P.
By: Farallon Partners, L.L.C.,
as General Partner
By:
-------------------------------------
Name:
Title:
STATE STREET BANK & TRUST,
solely in its capacity as Custodian for
General Motors employees Global Group
Pension Trust as directed by DDJ Capital
Management, LLC, and not in its
individual capacity
By:
-------------------------------------
Name:
Title:
STONEHILL INSTITUTIONAL PARTNERS, L.P.
By:
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK
By:
-------------------------------------
Name:
Title:
BEAR XXXXXXX INVESTMENT PRODUCTS INC
By:
-------------------------------------
Name:
Title:
GALAXY CLO 1999-1, LTD.
By: SAI Investment Advisor, Inc.
Its: Collateral Manager
By:
-------------------------------------
Name:
Title:
KZH SOLEIL-2 LLC
By:
-------------------------------------
Name:
Title:
LIBERTYVIEW FUNDS, L.P.
By:
-------------------------------------
Name:
Title:
PROTECTIVE LIFE INSURANCE COMPANY
By:
-------------------------------------
Name:
Title:
SUNAMERICA LIFE INSURANCE COMPANY
By:
-------------------------------------
Name:
Title:
XXXXXXX CAPITAL LTD.
By: Citadel Limited Partnership,
Portfolio Manager
By: GLB Partners, L.P., its General
Partner
By: Citadel Investment Group, L.L.C., its
General Partner
By:
-------------------------------------
Name:
Title:
