[Conformed Copy]
Amended and Restated Credit Agreement
dated as of August 10, 2000
among
Global Crossing Ltd.
Global Crossing Holdings Ltd.
Global Crossing North America, Inc.
The Lenders Party Hereto
and
________________________________________________________________________________
$1,000,000,000 Revolving Credit Facility
The Chase Manhattan Bank as Administrative Agent
and
Goldman Sachs Credit Partners L.P. as Syndication Agent
Citicorp USA, Inc., Merrill Lynch Capital Corporation as Co-Documentation Agents
Chase Securities Inc., Goldman Sachs Credit Partners L.P.
as Joint Lead Arrangers and Joint Book Managers
and
Salomon Smith Barney Inc., Merrill Lynch & Co.,
CIBC World Markets Corp. and Deutsche Bank Securities Inc.
as Arrangers
________________________________________________________________________________
$700,000,000 Revolving Term Facility
$550,000,000 Term Loan B
The Chase Manhattan Bank as Administrative Agent
and
Goldman Sachs Credit Partners L.P. as Syndication Agent
Citicorp USA, Inc., Merrill Lynch Capital Corporation as Co-Documentation Agents
Chase Securities Inc. as Sole Book Manager and Sole Lead Arranger
ABN Amro Bank, N.V., Bank of America, N.A.,
Barclays Bank plc, CIBC World Markets Corp.,
Deutsche Bank Securities Inc., Goldman Sachs Credit Partners L.P.,
Merrill Lynch & Co., Salomon Smith Barney Inc. and WestLB
as Arrangers
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms...................................................... 1
SECTION 1.02. Classification of Loans and Borrowings............................. 34
SECTION 1.03. Terms Generally.................................................... 34
SECTION 1.04. Accounting Terms; GAAP; Treatment of Unrestricted Subsidiaries..... 35
SECTION 1.05. Construction of the Term "Borrower"................................ 35
SECTION 1.06. Delivery of Lender Addenda......................................... 36
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments........................................................ 36
SECTION 2.02. Loans and Borrowings............................................... 36
SECTION 2.03. Requests for Borrowings............................................ 37
SECTION 2.04. Swingline Loans.................................................... 38
SECTION 2.05. Letters of Credit.................................................. 40
SECTION 2.06. Funding of Borrowings.............................................. 44
SECTION 2.07. Interest Elections................................................. 45
SECTION 2.08. Termination and Reduction of Commitments; Increase of Commitments.. 46
SECTION 2.09. Repayment of Loans; Evidence of Debt............................... 48
SECTION 2.10. Amortization of Term Loans......................................... 49
SECTION 2.11. Prepayment of Loans; Assumption of Loans........................... 50
SECTION 2.12. Fees............................................................... 53
SECTION 2.13. Interest........................................................... 54
SECTION 2.14. Alternate Rate of Interest......................................... 55
SECTION 2.15. Increased Costs.................................................... 55
SECTION 2.16. Break Funding Payments............................................. 57
SECTION 2.17. Taxes.............................................................. 57
SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-Offs........ 59
SECTION 2.19. Mitigation Obligations; Replacement of Lenders..................... 60
(i)
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. Organization; Powers; Licenses...................................... 61
SECTION 3.02. Authorization; Enforceability; Effectiveness........................ 61
SECTION 3.03. Governmental Approvals; No Conflicts................................ 62
SECTION 3.04. Financial Condition; No Material Adverse Change..................... 62
SECTION 3.05. Properties.......................................................... 63
SECTION 3.06. Litigation and Environmental Matters................................ 63
SECTION 3.07. Compliance with Laws and Agreements................................. 64
SECTION 3.08. Investment and Holding Company Status............................... 64
SECTION 3.09. Taxes............................................................... 64
SECTION 3.10. ERISA............................................................... 64
SECTION 3.11. Disclosure.......................................................... 64
SECTION 3.12. Subsidiaries and Collateral......................................... 65
SECTION 3.13. Insurance........................................................... 65
SECTION 3.14. Labor Matters....................................................... 65
SECTION 3.15. Senior Indebtedness................................................. 65
SECTION 3.16. Regulatory Matters; Etc............................................. 65
SECTION 3.17. Indenture Compliance................................................ 66
SECTION 3.18. Margin Regulations.................................................. 66
ARTICLE IV
CONDITIONS
SECTION 4.01. Restatement Effective Date.......................................... 66
SECTION 4.02. Each Credit Event................................................... 68
ARTICLE V
AFFIRMATIVE COVENANTS
SECTION 5.01. Financial Statements and Other Information.......................... 69
SECTION 5.02. Notices of Material Events.......................................... 70
SECTION 5.03. Existence; Conduct of Business...................................... 71
SECTION 5.04. Payment of Obligations.............................................. 71
SECTION 5.05. Maintenance of Properties........................................... 71
SECTION 5.06. Insurance........................................................... 71
SECTION 5.07. Books and Records; Inspection and Audit Rights...................... 71
(ii)
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SECTION 5.08. Compliance with Laws.......................................................... 71
SECTION 5.09. Use of Proceeds and Letters of Credit......................................... 72
SECTION 5.10. Additional Subsidiaries....................................................... 72
SECTION 5.11. Further Assurances............................................................ 72
ARTICLE VI
NEGATIVE COVENANTS
SECTION 6.01. Indebtedness; Certain Equity Securities....................................... 73
SECTION 6.02. Liens......................................................................... 76
SECTION 6.03. Fundamental Changes........................................................... 77
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions..................... 79
SECTION 6.05. Asset Sales and Designations of and Investments in Unrestricted Subsidiaries.. 81
SECTION 6.06. Sale and Leaseback Transactions............................................... 85
SECTION 6.07. Hedging Agreements............................................................ 86
SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness......................... 86
SECTION 6.09. Transactions with Affiliates.................................................. 87
SECTION 6.10. Restrictive Agreements........................................................ 88
SECTION 6.11. Amendment of Material Documents............................................... 89
SECTION 6.12. Interest Expense Coverage Ratio............................................... 89
SECTION 6.13. Total Leverage Ratio.......................................................... 89
SECTION 6.14. Synthetic Repurchases......................................................... 89
ARTICLE VII
EVENTS OF DEFAULT.................................... 90
ARTICLE VIII
THE ADMINISTRATIVE AGENT................................ 93
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices....................................................................... 95
SECTION 9.02. Waivers; Amendments........................................................... 96
SECTION 9.03. Expenses; Indemnity; Damage Waiver............................................ 98
(iii)
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SECTION 9.04. Successors and Assigns....................................................... 100
SECTION 9.05. Survival..................................................................... 103
SECTION 9.06. Counterparts; Integration; Effectiveness..................................... 103
SECTION 9.07. Severability................................................................. 103
SECTION 9.08. Right of Setoff.............................................................. 103
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process................... 104
SECTION 9.10. WAIVER OF JURY TRIAL......................................................... 104
SECTION 9.11. Headings..................................................................... 105
SECTION 9.12. Confidentiality.............................................................. 105
SECTION 9.13. Interest Rate Limitation..................................................... 105
SECTION 9.14. Conversion of Currencies..................................................... 106
SECTION 9.15. Waiver of Certain Defaults................................................... 106
(iv)
SCHEDULES:
Schedule 1.01(a) -- The LECs
Schedule 1.01(b) -- GCNA Subsidiaries that are not Loan Parties
Schedule 2.01 -- Commitments
Schedule 3.12 -- Subsidiaries and Collateral
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.04 -- Existing Investments
Schedule 6.10 -- Existing Restrictions
EXHIBITS:
--------
Exhibit A -- Form of Assignment and Acceptance
Exhibit B-1 -- Form of Opinion of James C. Gorton, General Counsel of
Limited
Exhibit B-2 -- Form of Opinion of Simpson Thacher & Bartlett, counsel for
Limited and certain of the Subsidiaries
Exhibit B-3 -- Form of Opinion of Martin T. McCue, Senior Vice President
and General Counsel of GCNA
Exhibit C -- Copy of Guarantee Agreement
Exhibit D -- Copy of Indemnity, Subrogation and Contribution Agreement
Exhibit E -- Copy of Pledge Agreement
Exhibit F -- Form of Reaffirmation Agreement
Exhibit G -- Form of Lender Addendum
(v)
AMENDED AND RESTATED CREDIT AGREEMENT dated as of August 10, 2000,
among GLOBAL CROSSING LTD., GLOBAL CROSSING HOLDINGS LTD., GLOBAL CROSSING NORTH
AMERICA, INC., the LENDERS party hereto, including each Revolving Term Lender
(as defined below) and each Tranche B Lender (as so defined) that becomes a
party hereto pursuant to a Lender Addendum (as so defined), and THE CHASE
MANHATTAN BANK, as Administrative Agent.
Global Crossing Ltd., Global Crossing Holdings Ltd., Global Crossing North
America, Inc. (formerly known as Frontier Corporation), certain of the Lenders
party hereto and the Administrative Agent are parties to a Credit Agreement
dated as of July 2, 1999 (as heretofore modified and supplemented and in effect
immediately before giving effect to the amendment and restatement contemplated
hereby, the "Existing Credit Agreement"), providing for "Revolving Loans",
-------------------------
"Tranche A Term Loans" and "Tranche B Term Loans" in an aggregate principal
amount of $3,000,000,000. All of the Tranche A Term Loans and Tranche B Term
Loans made under the Existing Credit Agreement have previously been paid in
full.
The Borrowers have now requested that the Existing Credit Agreement be
amended, inter alia, (i) to provide for the establishment of an additional
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tranche of revolving credit loans (which shall be convertible into term loans as
provided herein) in an aggregate principal amount of $700,000,000, and an
additional tranche of term loans in an aggregate principal amount of
$550,000,000, and in connection therewith to add certain additional banks and
financial institutions as "Lenders" party hereto, and (ii) to effect certain
other amendments to the Existing Credit Agreement. The Borrowers have also
requested that the Existing Credit Agreement, as so amended, be restated in its
entirety to read as provided herein. Accordingly, subject to the satisfaction
of the conditions to effectiveness set forth in Section 4.01, but effective on
the Restatement Effective Date (as hereinafter defined), the Existing Credit
Agreement shall be amended and restated to read in its entirety as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms. As used in this Agreement, the
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following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
---
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
------------------
for any Interest Period, an interest rate per annum (rounded, if necessary, to
the nearest 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
Credit Agreement
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"Administrative Agent" means The Chase Manhattan Bank, in its capacity
--------------------
as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
----------------------------
in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another Person
---------
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum equal to
-------------------
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
----
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Rate" means, for Revolving Credit Loans, Revolving Term
---------------
Loans and Tranche B Loans, the applicable rate per annum set forth below under
the caption "ABR Spread" or "Eurodollar Spread", as the case may be, based upon
the ratings established by Moody's and S&P for the Index Debt as of the most
recent determination date:
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Revolving Credit and Tranche B
Revolving Term
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Credit Rating ABR Eurodollar ABR Eurodollar
Spread Spread Spread Spread
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Category 1 0.00% 1.00% 1.00% 2.00%
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BBB or better
Baa2 or better
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Category 2 0.25% 1.25% 1.00% 2.00%
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BBB- and
Baa3
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Category 3 1.25% 2.25% 1.75% 2.75%
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BB+ or BB
Ba1 or Ba2
---------------------------------------------------------------------------------------------------------
Category 4 1.50% 2.50% 2.00% 3.00%
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BB- or lower and
Ba3 or lower
=========================================================================================================
For purposes of the foregoing, (a) in the event the ratings
established by Moody's and S&P for the Index Debt fall within different
categories, (i) if either rating is in Category 3, Category 3 shall apply, (ii)
if neither rating is in Category 3 or Category 4, Category 1 shall
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apply and (iii) if either rating (but not both) is in Category 4, Category 3
shall apply, (b) in the event the ratings established by both Moody's and S&P
for the Index Debt fall within the same Category, such Category shall apply, (c)
if neither Moody's nor S&P shall have established ratings for the Index Debt,
the ratings shall be deemed to be in Category 4, (d) after the occurrence and
during the continuance of any Event of Default, the ratings shall be deemed to
be in Category 4, and (e) if any rating established by Moody's or S&P shall be
changed (other than as a result of a change in the rating system of such rating
agency), such change shall be effective as of the date on which such change is
first announced by the rating agency making such change. If the rating system of
Moody's or S&P shall change, or if either of them shall cease rating the Index
Debt (other than by reason of any action or nonaction by either Borrower
following or in anticipation of a ratings downgrade), the parties hereto shall
negotiate in good faith to amend the references to specific ratings in this
definition (including by way of substituting another rating agency mutually
acceptable to the Borrowers and the Administrative Agent for the rating agency
with respect to which the rating system has changed or for which no rating is
then in effect) to reflect such changed rating system or the nonavailability of
ratings from such rating agency, and pending agreement on such amendment, the
rating in effect immediately prior to such change or cessation will apply. If
any rating agency shall not have a rating in effect by reason of any action or
nonaction by either Borrower following or in anticipation of a ratings
downgrade, then such rating agency shall be deemed to have established a rating
in Category 4.
"Applicable Revolving Credit Percentage" means, with respect to any
--------------------------------------
Revolving Credit Lender, the percentage of the total Revolving Credit
Commitments represented by such Lender's Revolving Credit Commitment. If the
Revolving Credit Commitments have terminated or expired, the Applicable
Revolving Credit Percentages shall be determined based upon the Revolving Credit
Commitments most recently in effect, after giving effect to any assignments.
"Assignment and Acceptance" means an assignment and acceptance entered
-------------------------
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.
"Available Equity Proceeds" means, at any time, the sum of (a)
-------------------------
$2,480,000,000 and (b) the aggregate Net Proceeds of the issuance of Equity
Interests (other than Disqualified Stock) in Limited after the Restatement
Effective Date, net of the sum of (i) all investments made with Available Equity
Proceeds after the Restatement Effective Date under Section 6.04(j) or 6.05(l)
and (ii) all Restricted Payments made in reliance upon Section 6.08(a)(v).
Available Equity Proceeds shall be deemed to have been used to the extent
certified by Limited pursuant to Section 5.01(c)(iv), until the amount of
Available Equity Proceeds shall have been reduced to zero.
"Board" means the Board of Governors of the Federal Reserve System of
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the United States of America.
Credit Agreement
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"Borrowers" means GCHL and GCNA, subject to requirements of, and as
---------
more fully set forth in, Section 1.05.
"Borrowing" means (a) Loans of the same Class and Type, made,
---------
converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect, or (b) a Swingline Loan.
"Borrowing Request" means a request by the Borrowers for a Borrowing
-----------------
in accordance with Section 2.03.
"Business Day" means any day that is not a Saturday, Sunday or other
------------
day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a Eurodollar Loan,
--------
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Capital Expenditures" means, for any period (without duplication),
--------------------
(a) the additions to property, plant and equipment and other capital
expenditures of the Restricted Persons that are (or would be) set forth in a
consolidated statement of cash flows of the Restricted Persons for such period
prepared in accordance with GAAP and (b) Capital Lease Obligations incurred by
the Restricted Persons during such period.
"Capital Lease Obligations" of any Person means the obligations of
-------------------------
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Change in Control" means (a) the acquisition of ownership, directly
-----------------
or indirectly, beneficially or of record, by any Person, other than Limited or
any Subsidiary of Limited, of any Equity Interest in GCHL or GCNA other than the
Preferred Stock, any preferred stock that is not Disqualified Stock and any
Disqualified Stock permitted under Section 6.01(c); (b) the acquisition of
ownership, directly or indirectly, beneficially or of record, by any Person or
group (within the meaning of the Securities Exchange Act of 1934 and the rules
of the Securities and Exchange Commission thereunder as in effect on the
Restatement Effective Date) other than the Permitted Holders, of Equity
Interests representing more than 35% of the aggregate ordinary voting power (the
"Voting Stock") represented by the issued and outstanding Equity Interests in
------------
Limited, and the Permitted Holders own, in the aggregate, a lesser percentage of
the total Voting Stock (measured by a voting power rather than by number of
shares) of Limited than such Person or group and do not have the right or
ability by voting power, contract or otherwise to elect or designate for
election a majority of the board of directors of Limited (for purposes of this
clause, such other Person or group shall be deemed to "beneficially own" any
Voting Stock of a specified corporation held by a parent corporation if such
other Person or group beneficially owns, directly or indirectly, more than 35%
of the Voting Stock (measured by voting power
Credit Agreement
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rather than by number of shares) of such parent corporation and the Permitted
Holders beneficially own, directly or indirectly, in the aggregate a lesser
percentage of Voting Stock (measured by voting power rather than by number of
shares) of such parent corporation and do not have the right or ability by
voting power, contract or otherwise to elect or designate for election a
majority of the board of directors of such parent corporation); (c) occupation
of a majority of the seats (other than vacant seats) on the board of directors
of Limited by Persons who were neither (i) nominated by the board of directors
of Limited nor (ii) appointed by directors so nominated; or (d) the occurrence
of a "Change of Control" or similar event under the Senior Notes Indenture, the
Preferred Stock, the Exchange Note Indenture or the documentation evidencing or
governing the Existing Notes (excluding the IPC Notes).
"Change in Law" means (a) the adoption of any law, rule or regulation
-------------
after the Restatement Effective Date, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the Restatement Effective Date or (c) compliance by any Lender
or any Issuing Bank (or, for purposes of Section 2.15(b), by any lending office
of such Lender or by such Lender's or such Issuing Bank's holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the Restatement
Effective Date.
"Class", when used in reference to any Loan or Borrowing, refers to
-----
whether such Loan, or the Loans comprising such Borrowing, are Revolving Credit
Loans, Revolving Term Loans, Tranche B Term Loans, Incremental Loans or
Swingline Loans and, when used in reference to any Commitment, refers to whether
such Commitment is a Revolving Credit Commitment, Revolving Term Commitment or
Tranche B Commitment.
"Code" means the Internal Revenue Code of 1986, as amended from time
----
to time.
"Collateral" means any and all "Collateral", as defined in any
----------
applicable Security Document.
"Collateral and Guarantee Requirement" means the requirement that:
------------------------------------
(a) the Administrative Agent shall have received from Limited, GCHL,
GCNA and each Restricted Subsidiary either (i) a counterpart of a Guarantee
Agreement duly executed and delivered on behalf of such Person or (ii) in
the case of any Person that becomes a Restricted Subsidiary after the
Restatement Effective Date, a supplement to a Guarantee Agreement, in the
form specified therein, duly executed and delivered on behalf of such
Restricted Subsidiary, in each case involving a Restricted Subsidiary
together with, as applicable, a counterpart of an Indemnity, Subrogation
and Contribution Agreement or a supplement to an Indemnity, Subrogation and
Contribution Agreement, in the form specified therein, duly executed and
delivered on behalf of such Restricted Subsidiary;
(b) all outstanding Equity Interests in each Restricted Subsidiary
(other than GCHL) owned by or on behalf of any Restricted Person shall have
been pledged pursuant
Credit Agreement
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to a Pledge Agreement and the Administrative Agent shall have received
certificates or other instruments representing all such Equity Interests,
together with stock powers or other instruments of transfer with respect
thereto endorsed in blank;
(c) all outstanding Equity Interests in any Subsidiary that directly
owns Equity Interests in GlobalCenter shall have been pledged pursuant to a
Pledge Agreement and the Administrative Agent shall have received
certificates or other instruments representing all such Equity Interests,
together with stock powers or other instruments of transfer with respect
thereto endorsed in blank, provided that (x) if the Equity Interests in
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GlobalCenter are directly owned by an Unrestricted Subsidiary, then the
requirements of this paragraph (c) may be satisfied through the pledge
pursuant to a Pledge Agreement of all of the outstanding Equity Interests
in a single Unrestricted Subsidiary (reasonably satisfactory to the
Administrative Agent) that directly or indirectly owns all of the Equity
Interests in GlobalCenter and (y) if required by the terms of the
documentation evidencing or governing the 7-1/4% Senior Notes due 2004 of
GCNA or the 6% Dealer Remarketable Securities Due 2013 of GCNA, any Pledge
Agreement referred to in this paragraph (c) may grant equal and ratable
Liens on the applicable Equity Interests to secure the Obligations and to
secure obligations arising under such notes of GCNA (pursuant to provisions
reasonably acceptable to the Administrative Agent);
(d) the Administrative Agent shall have received from each Loan Party
as of the Restatement Effective Date a counterpart of the Reaffirmation
Agreement duly executed and delivered by such Person (or such alternative
documentation as may be recommended to the Administrative Agent by
applicable local counsel to effect substantially the same purposes as the
Reaffirmation Agreement);
(e) all documents and instruments, including Uniform Commercial Code
financing statements, required by law or reasonably requested by the
Administrative Agent to be filed, registered or recorded to create the
Liens intended to be created by the Security Documents and perfect such
Liens to the extent required by, and with the priority required by, the
Security Documents, shall have been filed, registered or recorded or
delivered to the Administrative Agent for filing, registration or
recording; and
(f) each Loan Party shall have obtained all consents and approvals
required to be obtained by it in connection with the execution and delivery
of all Security Documents to which it is a party, the performance of its
obligations thereunder and the granting by it of the Liens thereunder.
Notwithstanding the foregoing:
(i) a Restricted Subsidiary (other than GCHL and GCNA) shall not be
required to deliver a Guarantee Agreement or a Pledge Agreement if it would
be a violation of applicable law or, in the reasonable judgment of the
Administrative Agent, in consultation with Limited, GCHL or GCNA, the
expense, tax or regulatory consequences or difficulty of obtaining such
Guarantee Agreement or Pledge Agreement would not, in
Credit Agreement
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light of the benefits that would accrue to the Lenders, justify obtaining
such Guarantee Agreement or Pledge Agreement;
(ii) a Restricted Subsidiary that, upon its formation or
acquisition, is less than wholly owned by the Restricted Persons, shall not
be required to deliver a Guarantee Agreement or a Pledge Agreement if each
Restricted Person owning any Equity Interest therein shall be in compliance
with the Collateral and Guarantee Requirement;
(iii) none of Marine and its subsidiaries or the LECs shall be
required to deliver a Guarantee Agreement or a Pledge Agreement;
(iv) if IPC shall be a Restricted Subsidiary, the Collateral and
Guarantee Requirement shall be satisfied with respect to IPC when (A) a
Restricted Person shall have pledged the outstanding Equity Interests in
IPC pursuant to a Pledge Agreement and the Administrative Agent shall have
received certificates or other instruments representing all such Equity
Interests, together with stock powers or other instruments of transfer with
respect thereto endorsed in blank and (B) IPC and each Subsidiary of IPC
shall have duly executed a Guarantee Agreement and an Indemnity,
Subrogation and Contribution Agreement, provided that, for so long as the
--------
IPC Notes shall be outstanding and the indenture pursuant to which the IPC
Notes have been issued shall limit the ability of IPC or any of its
Subsidiaries to guarantee the Obligations, the requirements of this
paragraph (iv) shall be satisfied if (x) IPC and each Subsidiary of IPC
shall duly execute a Guarantee Agreement and an Indemnity, Subrogation and
Contribution Agreement providing direct credit support on terms
satisfactory to the Administrative Agent for not less than the greatest
amounts permitted from time to time by the indenture pursuant to which the
IPC Notes have been issued and (y) all investments in IPC or any Subsidiary
of IPC made by any Restricted Person (other than IPC and its subsidiaries)
after the Restatement Effective Date shall be (aa) to the maximum extent
reasonably practicable, in the form of loans made by Loan Parties (other
than IPC and its subsidiaries) that utilize, to the maximum extent
reasonably practicable, the exception to the IPC Notes' Indebtedness
covenant set forth in clause (vii) of the second paragraph of Section 4.03
of the indenture pursuant to which the IPC Notes have been issued (and
which loans are evidenced by intercompany notes in form satisfactory to the
Administrative Agent, guaranteed by each of the subsidiaries of IPC, and
pledged to the Administrative Agent pursuant to a Pledge Agreement) or (bb)
to the extent that it is not reasonably practicable to make such
investments as loans in accordance with the foregoing clause (aa), in such
other form as the Borrower may reasonably determine; and
(v) the Collateral and Guarantee Requirement shall be satisfied
with respect to GCNA and its subsidiaries when
(A) all the outstanding Equity Interests in GCNA and, if GCNA
has provided any Guarantee contemplated by Section 6.01(a)(v)(A), each
direct subsidiary of GCNA (other than any LEC), shall be pledged
pursuant to a Pledge
Credit Agreement
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Agreement and the Administrative Agent shall hold certificates or
other instruments representing all such Equity Interests, together
with stock powers or other instruments of transfer with respect
thereto endorsed in blank,
(B) a duly executed and delivered Guarantee Agreement and an
Indemnity, Subrogation and Contribution Agreement of each of GCHL and
GCNA shall be in effect and
(C) each Restricted Subsidiary of GCNA shall have duly executed
and delivered a Guarantee Agreement and an Indemnity, Subrogation and
Contribution Agreement, other than (x) the LECs, (y) the subsidiaries
of GCNA owned as of the Restatement Effective Date listed on Schedule
1.01(b) but not providing a Guarantee Agreement or Pledge Agreement as
of the Restatement Effective Date based on paragraph (i) above and (z)
subsidiaries of GCNA acquired or created after the Restatement
Effective Date that do not provide a Guarantee Agreement or Pledge
Agreement based on paragraph (i) or (ii) above,
provided that at any time that (X) any direct or indirect parent of GCHL
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owning a majority of the Equity Interests in GCHL shall be organized under
the laws of the United States or any State thereof or the District of
Columbia and (Y) GCNA continues as a Borrower hereunder (after satisfying
the conditions set forth in Section 1.05), (I) no Loan Party organized
under the laws of a jurisdiction other than the United States or any State
thereof or the District of Columbia (a "Non-U.S. Loan Party") shall be
-------------------
required to Guarantee any Obligation of GCNA or to pledge any Equity
Interest owned by it to secure any Obligation of GCNA and (II) any Loan
Party organized under the laws of the United States or any State thereof or
the District of Columbia that owns Equity Interests in any Non-U.S. Loan
Party shall be deemed to have satisfied the requirement set forth in
paragraph (b) above with respect to the Obligations of GCNA by its pledge
of all the non-voting Equity Interests in such Non-U.S. Loan Party held by
it and 65% of all the outstanding voting Equity Interests in such Non-U.S.
Loan Party or, if less, all such voting Equity Interests held by it.
The Administrative Agent is expressly authorized upon the request of
Limited, GCHL or GCNA to release any pledge or Guarantee previously delivered in
respect of any Obligation that at the time of such request is no longer required
by the Collateral and Guarantee Requirement. Without limiting the foregoing,
the Administrative Agent is expressly authorized upon the request of Limited,
GCHL or GCNA to release any Guarantee or pledge by, or any pledge of the Equity
Interests in, any Restricted Subsidiary (other than GCHL and GCNA) or in any
other Subsidiary of Limited specified in paragraph (c) above (including
GlobalCenter) upon:
(1) the sale, transfer or other disposition (other than to another
Restricted Person) of all the Equity Interests in such Restricted
Subsidiary in a transaction permitted by Section 6.05;
Credit Agreement
----------------
-9-
(2) the designation of such Restricted Subsidiary as an Unrestricted
Subsidiary in compliance with the requirements of Section 6.05
and the definition of "Unrestricted Subsidiary";
(3) the sale, transfer or other disposition (other than to another
Restricted Person) of part but not all of the Equity Interests in
such Restricted Subsidiary in a transaction permitted by Section
6.05;
(4) such Restricted Subsidiary no longer being required to provide a
Guarantee Agreement or Pledge Agreement as a result of the
application of the proviso to paragraph (v) above, provided that
--------
if such proviso becomes applicable in conjunction with a
transaction described in Section 6.03(a)(ii), GCHL or GCNA, as
applicable, shall have repaid in full all of its Loans (and
posted cash collateral for all of the LC Exposure) to the extent
required under Section 2.11(e); or
(5) with respect to any pledge of the Equity Interests in
GlobalCenter or any other Unrestricted Subsidiary specified in
paragraph (c) above, the sale of Equity Interests in GlobalCenter
Inc. or GlobalCenter (or any Unrestricted Subsidiary that
directly or indirectly owns any such Equity Interests) to a
Person that is not an Affiliate of any Restricted Person.
"Commitment" means a Revolving Credit Commitment, Revolving Term
----------
Commitment or Tranche B Commitment, or any combination thereof (as the context
requires).
"Commitment Fee Rate" means, for any day, the applicable percentage
-------------------
rate per annum specified under the applicable utilization column, based upon the
ratings established by Moody's and S&P for the Index Debt as of such day:
------------------------------------------------------------------------------------------
*33% 33-66% **66%
Ratings Utilization Utilization Utilization
------- ----------- ----------- -----------
------------------------------------------------------------------------------------------
Category 1 0.500 0.375 0.250
----------
BBB-/Baa3
or better
------------------------------------------------------------------------------------------
Category 2 0.750 0.500 0.375
----------
BB+/Ba1 or
BB/Ba2
------------------------------------------------------------------------------------------
Category 3 1.000 0.750 0.500
----------
BB-/Ba3 or
Lower
------------------------------------------------------------------------------------------
* More than
** Less than
For purposes of the foregoing, "utilization" at any time for the
-----------
Revolving Commitments of any Class means the percentage obtained by dividing (a)
the sum at such time
Credit Agreement
----------------
-10-
of the aggregate outstanding amount of all the Revolving Exposures of such Class
by (b) the aggregate outstanding Revolving Commitments of such Class.
For purposes of the foregoing, (a) in the event the ratings
established by Moody's and S&P for the Index Debt fall within different
categories, the lower rating shall apply, (b) if neither Moody's nor S&P shall
have established ratings for the Index Debt, the ratings shall be deemed to be
in Category 3, (c) after the occurrence and during the continuance of any Event
of Default, the ratings shall be deemed to be in Category 3, and (d) if any
rating established by Moody's or S&P shall be changed (other than as a result of
a change in the rating system of such rating agency), such change shall be
effective as of the date on which such change is first announced by the rating
agency making such change. If the rating system of Moody's or S&P shall change,
or if either of them shall cease rating the Index Debt (other than by reason of
any action or nonaction by either Borrower following or in anticipation of a
ratings downgrade), the parties hereto shall negotiate in good faith to amend
the references to specific ratings in this definition (including by way of
substituting another rating agency mutually acceptable to the Borrowers and the
Administrative Agent for the rating agency with respect to which the rating
system has changed or for which no rating is then in effect) to reflect such
changed rating system or the nonavailability of ratings from such rating agency,
and, pending agreement on such amendment, the rating in effect immediately prior
to such change or cessation will apply. If any rating agency shall not have a
rating in effect by reason of any action or nonaction by either Borrower
following or in anticipation of a ratings downgrade, then such rating agency
shall be deemed to have established a rating in Category 3.
"Consent" means the consent under the Senior Notes permitting the
-------
transactions contemplated by the Existing Credit Agreement and the other Loan
Documents obtained pursuant to the Amended and Restated Consent Solicitation
Statement dated June 22, 1999.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
-------------------
for such period, adjusted (without duplication and to the extent deducted or
added in determining such Consolidated Net Income) as follows: plus (a) an
----
amount equal to any extraordinary loss for such period, minus (b) an amount
-----
equal to any extraordinary gain for such period, plus (c) provision for taxes
----
based on income or profits of the Restricted Persons for such period, plus (d)
----
Consolidated Interest Expense for such period, whether paid or accrued and
whether or not capitalized, plus (e) the aggregate amount of cash dividends or
----
cash distributions actually received by any Restricted Person from any
Unrestricted Subsidiary during such period to the extent not in excess of the
EBITDA of such Unrestricted Subsidiary for the relevant period, plus (f)
----
depreciation, amortization (including amortization of goodwill and other
intangibles and the amount of capacity available for sale charged to cost of
sales, but excluding amortization of prepaid cash expenses that were paid in a
prior period) and other non-cash expenses (excluding any such non-cash expense
to the extent that it represents an accrual of or reserve for cash expenses in
any future period or amortization of a prepaid cash expense that was paid in a
prior period) of the Restricted Persons for such period, minus (g) non-cash
-----
items increasing such Consolidated Net Income for such period (other than items
that were accrued in the ordinary course of business), plus or minus (h) any
---- -----
increase or decrease, respectively, in Deferred
Credit Agreement
----------------
-11-
Revenue as of the last day of such period from Deferred Revenue as of the date
immediately preceding the first day of such period, in each case, on a
consolidated basis for the Restricted Persons and determined in accordance with
GAAP. For purposes of calculating the financial covenant set forth in Section
6.13 and, in the case of the GCNA Acquisition and the Marine Acquisition,
Section 6.12, if a material acquisition or disposition has occurred during the
relevant period, Consolidated EBITDA will be determined giving pro forma effect
--- -----
thereto (without giving effect to cost savings except to the extent approved by
the Administrative Agent) as if such acquisition or disposition and any related
incurrence or repayment of Indebtedness or issuance of preferred stock had
occurred at the beginning of the relevant four-quarter period.
"Consolidated Interest Expense" means, for any period, the
-----------------------------
consolidated cash interest expense included in a consolidated income statement
(without deduction of interest income) of the Restricted Persons for such
period, including without limitation or duplication (or, to the extent not so
included, with the addition of), (a) the interest component of any deferred
payment obligations, (b) the interest component of all payments associated with
Capital Lease Obligations, (c) commissions, discounts and other fees and charges
incurred in respect of Letter of Credit or bankers' acceptance financings, (d)
net payments or receipts (if any) pursuant to Hedging Agreements that relate to
the hedging of interest rate fluctuations and (e) dividends paid in cash in
respect of Disqualified Stock.
"Consolidated Net Income" means, for any period, the net income or
-----------------------
loss of the Restricted Persons for such period determined on a consolidated
basis in accordance with GAAP plus, to the extent that any of the following
----
items were deducted in computing such consolidated net income, (a) non-
recurring, non-cash charges (other than charges arising from write-downs of
assets) and (b) non-cash compensation charges arising from stock options or
other similar employee benefit or compensation plans; provided that (i) the net
--------
income (but not loss) of any Restricted Subsidiary that is accounted for by the
equity method of accounting shall be included only to the extent of the amount
of dividends or distributions paid in cash to Limited, GCHL, GCNA or a wholly
owned Restricted Subsidiary thereof by such Restricted Subsidiary and (ii) the
net income of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded.
"Control" means the possession, directly or indirectly, of the power
-------
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
----------- ----------
"Convertible Preferred Stock" means the following preferred stock of
---------------------------
Limited: (a) $650,000,000 aggregate liquidation preference of 7% cumulative
convertible preferred stock, (b) $1,000,000,000 aggregate liquidation preference
of 6-3/8% cumulative convertible preferred stock, (c) $400,000,000 aggregate
liquidation preference of 6-3/8% cumulative convertible preferred stock, series
B and (d) $1,150,000,000 aggregate liquidation preference of 6-3/4% cumulative
convertible preferred stock.
Credit Agreement
----------------
-12-
"date hereof" or "date of this Agreement" or other references to the
----------- ----------------------
date of this Agreement shall mean the date specified in the preamble to this
Agreement.
"Default" means any event or condition which constitutes an Event of
-------
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Defeased Obligations" means Indebtedness or other obligations of any
--------------------
Restricted Person (a) in respect of which such Restricted Person shall have
deposited cash and/or cash equivalents in a trust in an amount sufficient to
defease in full all payment obligations in respect of such Indebtedness through
the maturity of such Indebtedness in accordance with the terms of the defeasance
requirements of the indenture or other instrument governing such Indebtedness,
and (b) lease in lease out obligations ("LILOs") of Marine or a subsidiary
-----
thereof in which Marine or such subsidiary shall have deposited cash, cash
equivalents (or deposits with or the obligations of a banking institution with a
rating of AA or higher from S&P and Aa2 or higher from Moody's or other
obligations having such ratings or higher ratings) in a trust or as security in
an amount sufficient to pay in full all non-contingent payment obligations in
respect of such Indebtedness or obligations through the maturity thereof and in
a manner resulting in GAAP treatment in which such obligations do not constitute
liabilities and such deposit does not constitute an asset of Marine or such
subsidiary.
"Deferred Revenue" means, at any date, amounts appearing as a
----------------
liability on the financial statements of the Restricted Persons as prepared
according to GAAP classified as deferred revenue to the extent of cash received
in connection therewith.
"Disqualified Stock" means any Equity Interest that, by its terms (or
------------------
by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
final maturity of the latest maturing Loans; provided, however, that any Equity
-------- -------
Interest which would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require the repurchase or redemption
of such Equity Interest upon the occurrence of a sale, transfer or other
disposition of assets or a change of control shall not constitute Disqualified
Stock by reason of (a) an asset sale redemption requirement if such redemption
is required only to the extent such sale proceeds are not used to prepay debt or
are not redeployed in the issuer's business or (b) any change of control
redemption requirement if a Change in Control exists in respect of such change
of control. For purposes of this Agreement, the Preferred Stock and the
Convertible Preferred Stock shall not constitute Disqualified Stock.
"dollars" or "$" refers to lawful money of the United States of
------- -
America.
"Environmental Laws" means all applicable laws, rules, regulations,
------------------
codes, ordinances, orders, decrees, judgments, injunctions, notices, treaties or
binding agreements issued, promulgated or entered into by any Governmental
Authority, relating in any way to the
Credit Agreement
----------------
-13-
protection of the environment, the preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters relating to the work place or the
environment.
"Environmental Liability" means any liability, contingent or otherwise
-----------------------
(including any liability for damages, costs of environmental remediation,
remediation of natural resources, fines, penalties or indemnities), of Limited,
GCHL, GCNA or any Subsidiary directly or indirectly resulting from or based upon
(a) violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment, (e) impairment of or damage to
natural resources or (f) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Interests" means 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.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
---------------
incorporated) that, together with GCHL or GCNA is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section
-----------
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the GCHL, GCNA or any of their ERISA Affiliates of
any liability under Title IV of ERISA with respect to the termination of any
Plan; (e) the receipt by GCHL, GCNA or any ERISA Affiliate from the PBGC or a
plan administrator of any notice relating to an intention to terminate any Plan
or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by
GCHL, GCNA or any of their ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by GCHL, GCNA or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from GCHL, GCNA or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
Credit Agreement
----------------
-14-
"Eurodollar", when used in reference to any Loan or Borrowing, refers
----------
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
----------------
VII.
"Excess Cash Flow" means, for any fiscal year, the sum (without
----------------
duplication) of the following:
(a) Consolidated Net Income (or loss) of the Restricted Persons for
such fiscal year, adjusted to exclude any gains or losses attributable to
Prepayment Events; plus
----
(b) depreciation, amortization and other non-cash charges or losses
deducted in determining such Consolidated Net Income (or loss) for such
fiscal year; plus
----
(c) the sum of (i) the amount, if any, by which Net Working Capital
decreased during such fiscal year plus (ii) the net amount, if any, by
----
which Deferred Revenues increased during such fiscal year; minus
-----
(d) the sum of (i) any non-cash gains included in determining such
Consolidated Net Income (or loss) for such fiscal year plus (ii) the
----
amount, if any, by which Net Working Capital increased during such fiscal
year plus (iii) the net amount, if any, by which Deferred Revenues
----
decreased during such fiscal year; minus
-----
(e) the sum of (i) Capital Expenditures for such fiscal year (except
to the extent attributable to the incurrence of Capital Lease Obligations
or otherwise financed by incurring Long-Term Indebtedness or with funds
that would otherwise have constituted Net Proceeds of a Prepayment Event)
plus (ii) cash consideration paid during such fiscal year by the Restricted
----
Persons to make acquisitions or other capital investments (except to the
extent financed by incurring Long-Term Indebtedness or with funds that
would otherwise have constituted Net Proceeds of a Prepayment Event); minus
-----
(f) the aggregate principal amount of Long-Term Indebtedness
(including Capital Lease Obligations) repaid or prepaid by the Restricted
Persons during such fiscal year, excluding (i) Indebtedness in respect of
Revolving Loans and Letters of Credit, (ii) Term Loans prepaid pursuant to
Section 2.11(c) or (d), and (iii) repayments or prepayments of Long-Term
Indebtedness financed by incurring other Long-Term Indebtedness.
For purposes of the foregoing, the Restricted Subsidiaries shall
include only the Subsidiaries that were Restricted Subsidiaries as of the last
day of the fiscal year in respect of which Excess Cash Flow is being calculated.
"Exchange Notes" means the subordinated notes of GCHL issuable in
--------------
exchange for the Preferred Stock.
Credit Agreement
----------------
-15-
"Exchange Note Indenture" means the indenture to be entered into by
-----------------------
GCHL upon the issuance of, and which shall govern the terms of, the Exchange
Notes, which shall have substantially the terms described in the Offering
Memorandum for the Preferred Stock dated November 24, 1998.
"Excluded Taxes" means, with respect to the Administrative Agent, any
--------------
Lender, any Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of GCHL or GCNA hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction described in clause (a) above and (c) any withholding
tax that (i) is in effect and would apply to amounts payable to any Lender at
the time such Lender becomes a party to this Agreement (or designates a new
lending office), other than any withholding tax imposed on any payment, in
respect of a Guarantee, from a Guarantor that is domiciled outside the United
States and except to the extent that such Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from the Borrowers with respect to any withholding
tax pursuant to Section 2.17(a), or (ii) is attributable to such Lender's
failure to comply with Section 2.17(e).
"Existing Indebtedness" has the meaning assigned to such term in
---------------------
Section 6.01(a)(iii).
"Existing Notes" means the Senior Notes, the Exchange Notes, the IPC
--------------
Notes (but only if IPC is a Restricted Subsidiary), the 9-1/2% Senior Notes due
2009 of GCHL, the 9-1/8% Senior Notes due 2006 of GCHL, the Medium Term Notes of
GCNA, the 7-1/4% Senior Notes due 2004 of GCNA, the 6% Dealer Remarketable
Securities Due 2013 of GCNA and the 9% Senior Notes due 2021 of GCNA.
"Existing Subsidiary" has the meaning assigned to such term in the
-------------------
definition of "Restricted Subsidiary" in this Section.
"FCC" means the Federal Communications Commission or any Governmental
---
Authority substituted therefor.
"Federal Funds Effective Rate" means, for any day, the weighted
----------------------------
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
Credit Agreement
----------------
-16-
"Financial Officer" means the chief financial officer, principal
-----------------
accounting officer, treasurer or controller of Limited, GCHL or GCNA, as
applicable.
"GAAP" means generally accepted accounting principles in the United
----
States of America.
"GCHL" means Global Crossing Holdings Ltd., a Bermuda corporation and
----
any permitted successor thereto as a result of a transaction permitted by
Section 6.03(a)(i).
"GCHL Conversion Date" means the first date on which GCHL shall be
--------------------
organized under the laws of the United States or any State thereof or the
District of Columbia.
"GCNA" means Global Crossing North America, Inc., a New York
----
corporation, formerly known as Frontier Corporation.
"GCNA Acquisition" means the acquisition by Limited on September 28,
----------------
1999 of all the common Equity Interests in GCNA pursuant to the Agreement and
Plan of Merger dated as of March 16, 1999 among Limited, GCF Acquisition Corp.
and GCNA.
"GlobalCenter" means GlobalCenter Holdings Inc., a Delaware
------------
corporation.
"Governmental Authority" means the government of the United States of
----------------------
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any
--------- ---------
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
---------------
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided that the term Guarantee shall not include
--------
endorsements for collection or deposit in the ordinary course of business.
"Guarantee Agreement" means the Guarantee Agreement dated as of July
-------------------
2, 1999 among GCHL, GCNA, Limited, the other Guarantors party thereto and the
Administrative Agent, a copy of which is attached as Exhibit C or, if required
or to the extent advisable in a
Credit Agreement
----------------
-17-
jurisdiction outside the United States, another form of agreement providing for
a Guarantee of the Obligations satisfactory in form and scope to the
Administrative Agent.
"Hazardous Materials" means all explosive or radioactive substances
-------------------
or wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes,
radio frequency emissions, electromagnetic field radiation and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
-----------------
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"Incremental Loans" has the meaning assigned to such term in Section
-----------------
2.08(e).
"Indebtedness" of any Person means, without duplication, (a) all
------------
obligations of such Person for borrowed money or with respect to deposits (other
than customer deposits in respect of capacity purchases shown as assets on such
Person's balance sheet) or advances of any kind, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person upon which interest charges are customarily paid, (d)
all obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person (excluding obligations
under contracts for the supply of goods, equipment or fiber in connection with
the installation, construction, operation and/or maintenance of the Borrowers'
network, provided that all obligations thereunder in respect of any such
--------
property are due upon completion of such installation, construction or other
work and are not overdue), (e) all obligations of such Person in respect of the
deferred purchase price of property or services (excluding accounts payable
incurred in the ordinary course of business which are not past due by more than
90 days), (f) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor. For
purposes of this Agreement, Indebtedness shall not include (i) Defeased
Obligations or (ii) obligations to any seller of backhaul capacity or dark fiber
(or any financing Affiliate thereof) the proceeds of which are used to finance
the purchase of such capacity or dark fiber from such seller in the ordinary
course of business.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
-----------------
Credit Agreement
----------------
-18-
"Indemnity, Subrogation and Contribution Agreement" means the
-------------------------------------------------
Indemnity, Subrogation and Contribution Agreement dated as of July 2, 1999 among
GCHL, GCNA, the Subsidiary Guarantors party thereto and the Administrative
Agent, a copy of which is attached as Exhibit D or, if required or to the extent
advisable in a jurisdiction outside the United States, another form of agreement
designed to achieve the intended result satisfactory in form and scope to the
Administrative Agent.
"Index Debt" means the highest rated senior, unsecured, long-term
----------
Indebtedness for borrowed money of either Borrower that is not guaranteed or
otherwise credit enhanced, other than by Limited or the other Borrower.
"Information Memorandum" means the Confidential Information Memorandum
----------------------
dated June 2000 relating to the Restricted Persons and the Transactions.
"Interest Election Request" means a request by the Borrowers to
-------------------------
convert or continue a Revolving Borrowing or Term Borrowing in accordance with
Section 2.07.
"Interest Payment Date" means (a) with respect to any ABR Loan (other
---------------------
than a Swingline Loan), the last day of each March, June, September and
December, (b) with respect to any Eurodollar Loan, the last day of the Interest
Period applicable to the Borrowing of which such Loan is a part and, in the case
of a Eurodollar Borrowing with an Interest Period of more than three months'
duration, each day prior to the last day of such Interest Period that occurs at
intervals of three months' duration after the first day of such Interest Period,
and (c) with respect to any Swingline Loan, the day that such Loan is required
to be repaid.
"Interest Period" means, with respect to any Eurodollar Borrowing, the
---------------
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
thereafter (or nine or twelve months thereafter if, at the time of the relevant
Borrowing, all Lenders participating therein agree to make interest periods of
such duration available), as the Borrowers may elect; provided that (a) if any
--------
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (b) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
"Investment Grade Date" means the first day on which the ratings
---------------------
established by both Moody's and S&P for the Index Debt are, respectively, Baa2
or better and BBB or better.
"IPC" means IPC Information Systems, Inc., a Delaware corporation, and
---
its subsidiaries.
Credit Agreement
----------------
-19-
"IPC Notes" means the 10-7/8% Senior Discount Notes due 2008 of IPC.
---------
"Issuing Bank" means each of The Chase Manhattan Bank and, at any
------------
time, up to five additional Lenders specified by Limited and acceptable to the
Administrative Agent who have agreed to serve as Issuing Banks in a written
document satisfactory to the Administrative Agent, in each case in its capacity
as an issuer of Letters of Credit hereunder, and its successors in such capacity
as provided in Section 2.05(i). An Issuing Bank may, in its discretion, arrange
for one or more Letters of Credit to be issued by Affiliates of such Issuing
Bank (including in the case of The Chase Manhattan Bank, Chase Manhattan Bank
Delaware), in which case the term "Issuing Bank" shall include any such
Affiliate with respect to Letters of Credit issued by such Affiliate.
"LC Borrowing" has the meaning set forth in Section 2.02(b).
------------
"LC Disbursement" means a payment made by an Issuing Bank pursuant to
---------------
a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
-----------
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
----
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Borrowers at such time. The LC Exposure of any Revolving Credit Lender
at any time shall be its Applicable Revolving Credit Percentage of the total LC
Exposure at such time.
"LECs" means the incumbent local exchange carrier subsidiaries, and
----
the other related subsidiaries, of GCNA, as specified on Schedule 1.01(a).
"Lender Addendum" means, with respect to any Revolving Term Lender or
---------------
Tranche B Lender, a Lender Addendum substantially in form of Exhibit G, dated as
of the date hereof and executed and delivered by such Revolving Term Lender or
Tranche B Lender, as applicable, as provided in Section 1.06.
"Lender Affiliate" means (a) with respect to any Lender, (i) an
----------------
Affiliate of such Lender or (ii) any Person (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 that invests in
bank loans, any other fund or trust or entity that invests in bank loans and is
advised or managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"Lenders" means the Persons listed on Schedule 2.01 and any other
-------
Person that shall have become a party hereto pursuant to a Lender Addendum or an
Assignment and Acceptance, other than any such Person that ceases to be a party
hereto pursuant to an Assignment and Acceptance. Unless the context otherwise
requires, the term "Lenders" includes the Swingline Lender.
Credit Agreement
----------------
-20-
"Letter of Credit" means any letter of credit issued pursuant to this
----------------
Agreement.
"Leverage Ratio" means, on any date, the ratio of (a) the sum of Total
--------------
Indebtedness and the liquidation preference of Disqualified Stock as of such
date to (b) Consolidated EBITDA for the period of four consecutive fiscal
quarters of Limited ended on such date (or, if such date is not the last day of
a fiscal quarter, ended on the last day of the fiscal quarter of Limited most
recently ended prior to such date).
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
---------
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
----
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Limited" means Global Crossing Ltd., a Bermuda corporation, and any
-------
permitted successor thereto as a result of a transaction permitted by Section
6.03(a)(ii).
"Limited Conversion Date" means the first date on which Limited or any
-----------------------
other direct or indirect parent of GCHL shall be organized under the laws of the
United States or any State thereof or the District of Columbia.
"Loan Documents" means this Agreement, the Guarantee Agreements, the
--------------
Indemnity, Subrogation and Contribution Agreements and the other Security
Documents.
"Loan Parties" means Limited, GCHL, GCNA and the Subsidiary Loan
------------
Parties.
"Loans" means the loans made by the Lenders to GCHL and GCNA pursuant
-----
to this Agreement.
Credit Agreement
----------------
-21-
"Long-Term Indebtedness" means any Indebtedness that, in accordance
----------------------
with GAAP, constitutes (or, when incurred, constituted) a long-term liability.
"Marine" means Global Marine Systems Limited, a United Kingdom
------
company.
"Marine Acquisition" means the acquisition of all the common Equity
------------------
Interests in Marine and certain Affiliates thereof pursuant to the Sale and
Purchase Agreement between Limited and Cable and Wireless PLC dated as of April
26, 1999.
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
business, assets, operations or condition, financial or otherwise, of the
Restricted Persons taken as a whole (excluding adverse effects, if any, arising
out of a diminution in value of the investment of the Restricted Persons in
Unrestricted Subsidiaries), (b) the ability of any Loan Party to perform any of
its obligations under any Loan Document or (c) the rights of or benefits
available to the Lenders under any Loan Document.
"Material Indebtedness" means Indebtedness (other than the Loans and
---------------------
Letters of Credit), or obligations in respect of one or more Hedging Agreements,
of any one or more of the Restricted Persons in an aggregate principal amount
exceeding (a) at any time prior to the Investment Grade Date, $50,000,000, and
(b) at any time on or after the Investment Grade Date, $100,000,000. For
purposes of determining Material Indebtedness, the "principal amount" of the
----------------
obligations of any Restricted Person in respect of any Hedging Agreement at any
time shall be the maximum aggregate amount (giving effect to any netting
agreements) that such Restricted Person would be required to pay if such Hedging
Agreement were terminated at such time.
"Material Preferred Stock" means preferred stock of any one or more of
-------------------------
the Restricted Persons having an aggregate liquidation preference exceeding (a)
at any time prior to the Investment Grade Date, $50,000,000, and (b) at any time
on or after the Investment Grade Date, $100,000,000.
"Moody's" means Moody's Investors Service, Inc.
-------
"Multiemployer Plan" means a multiemployer plan as defined in Section
------------------
4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any event (a) the cash proceeds
------------
received in respect of such event including (i) any cash received in respect of
any non-cash proceeds, but only as and when received, (ii) in the case of a
casualty, insurance proceeds, and (iii) in the case of a condemnation or similar
event, condemnation awards and similar payments, net of (b) the sum of (i) all
reasonable fees and out-of-pocket expenses paid by the Restricted Persons to
third parties (other than Affiliates) in connection with such event, (ii) in the
case of a sale, transfer or other disposition of an asset (including pursuant to
a sale and leaseback transaction or a casualty or a condemnation or similar
proceeding), the amount of all payments required to be made by the Restricted
Persons as a result of such event to repay Indebtedness (other than Loans)
secured by such asset or otherwise subject to mandatory prepayment as a result
of such event, and (iii) the
Credit Agreement
----------------
-22-
amount of all taxes paid (or reasonably estimated to be payable) by the
Restricted Persons, and the amount of any reserves established by the Restricted
Persons to fund contingent liabilities reasonably estimated to be payable, 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).
"Net Tangible Assets" means, at any date, the assets of the Restricted
-------------------
Persons at such date minus the intangible assets of the Restricted Persons, all
-----
determined on a consolidated basis in accordance with GAAP.
"Net Working Capital" means, at any date, (a) the consolidated current
-------------------
assets of the Restricted Persons as of such date (excluding cash and Permitted
Investments) minus (b) the consolidated current liabilities of the Restricted
-----
Persons as of such date (excluding current liabilities in respect of
Indebtedness). 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. For
purposes of calculating Excess Cash Flow, Net Working Capital shall be
determined after eliminating any increase due to any reduction or termination of
any Permitted Securitization or any decrease due to the implementation or
increase of any Permitted Securitization.
"Obligations" has the meaning assigned to such term in the form of
-----------
Guarantee Agreement attached hereto as Exhibit C.
"Original Effective Date" means July 7, 1999.
-----------------------
"Other Taxes" means any and all present or future recording, stamp,
-----------
documentary, excise, transfer, sales, property or similar taxes, charges or
levies arising from any payment made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
----
defined in ERISA and any successor entity performing similar functions.
"Permitted Acquisition" means any acquisition by any Restricted Person
---------------------
of all or substantially all the assets of, or all the Equity Interests in, a
Person or division or line of business of a Person if, immediately after giving
effect thereto, (a) no Default has occurred and is continuing or would result
therefrom, (b) the principal business of such Person shall be reasonably
related, ancillary or complementary to a business in which the Restricted
Persons were engaged on the Restatement Effective Date, (c) each Subsidiary
formed for the purpose of or resulting from such acquisition shall be a
Restricted Subsidiary and all the Equity Interests of each such Subsidiary shall
be owned directly by a Restricted Person and all actions required to be taken
with respect to such acquired or newly formed Subsidiary under Sections 5.10 and
5.11 have been taken, (d) the Restricted Persons are in compliance with the
covenants contained in Sections 6.12 and 6.13 computed on a Pro Forma Basis as
at the last day of the most recently ended fiscal quarter of Limited for which
financial statements are available and (e) the
Credit Agreement
----------------
-23-
Borrowers have delivered to the Administrative Agent an officers' certificate to
the effect set forth in clauses (a), (b), (c) and (d) above, together with all
relevant financial information for the Person or assets to be acquired and
reasonably detailed calculations demonstrating satisfaction of the requirement
set forth in clause (d) above.
"Permitted Encumbrances" means:
----------------------
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
and other like Liens imposed by law, arising in the ordinary course of
business and securing obligations that are not overdue by more than 30 days
or are being contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds
and other obligations of a like nature, in each case in the ordinary course
of business;
(e) judgment Liens in respect of judgments that do not constitute an
Event of Default under paragraph (k) of Article VII;
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere
with the ordinary conduct of business of any Restricted Person;
(g) leases and grants of indefeasible rights of use, rights of use
and similar rights in respect of capacity, dark fiber and similar assets of
the Restricted Persons in the ordinary course of business; and
(h) Liens in favor of Loan Parties;
provided that the term "Permitted Encumbrances" shall not include any Lien
--------
securing Indebtedness.
"Permitted Holder" means Pacific Capital Group, Inc. and CIBC World
----------------
Markets Inc. and their respective Affiliates.
Credit Agreement
----------------
-24-
"Permitted Investments" means:
---------------------
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America, Canada, the United Kingdom, Germany, France or Italy (or by any
agency thereof to the extent such obligations are backed by the full faith
and credit of such country), in each case maturing within one year from the
date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the
date of acquisition thereof, and rated, at such date of acquisition, not
less than A1 by S&P or P1 by Moody's;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within 180 days from the date of acquisition
thereof, issued or guaranteed by or placed with, money market deposit
accounts issued or offered by, and demand deposit accounts at any domestic
office of any commercial bank organized under the laws of the United States
of America or any State thereof or Canada, the United Kingdom, Germany,
France or Italy, which has a combined capital and surplus and undivided
profits of not less than $500,000,000;
(d) interests in any money market mutual fund registered under the
Investment Company Act of 1940, as amended, the portfolio of which is
limited primarily to obligations described in the foregoing clauses (a),
(b) and (c), so long as such fund has total assets of at least
$1,000,000,000;
(e) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in paragraph (a) above and
entered into with a financial institution satisfying the criteria described
in paragraph (c) above.
"Permitted Securitization" means any off-balance sheet transaction or
------------------------
series of transactions that may be entered into by any Restricted Person
pursuant to which such Restricted Person may sell, convey or otherwise transfer
to (a) a Receivables Entity (in the case of a transfer by any Restricted Person)
in a true sale transaction and (b) any other Person (in the case of a transfer
by a Receivables Entity), and any Receivables Entity may grant a security
interest in, any receivables (whether now existing or arising in the future) of
any Restricted Person, and any assets related thereto including all collateral
securing such receivables, all contracts and all guarantees or other obligations
in respect of such receivables and the proceeds of such receivables; provided
--------
that (i) the aggregate outstanding face amount of the receivables sold into such
securitization, together with the aggregate outstanding face amount of the
receivables sold into all other Permitted Securitizations, shall not exceed
$450,000,000 at any time outstanding, (ii) there shall be no recourse under such
securitization to any Restricted Person other than pursuant to Standard
Securitization Undertakings and (iii) the Administrative Agent shall be
satisfied that the terms of such securitization are in compliance with the terms
of this Agreement.
Credit Agreement
----------------
-25-
"Person" means any natural person, corporation, limited liability
------
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
----
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which GCHL, GCNA or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreement" means (a) the Pledge Agreement dated as of July 2,
----------------
1999 among GCHL, GCNA, the other Pledgors party thereto and the Administrative
Agent, a copy of which is attached as Exhibit E, (b) if required or to the
extent advisable in a jurisdiction outside the United States, another form of
agreement providing for the pledge of Equity Interests to secure the Obligations
satisfactory in form and scope to the Administrative Agent or (c) any pledge
agreement in form and substance satisfactory to the Administrative Agent entered
into pursuant to paragraph (c) of the definition of "Collateral and Guarantee
Requirement" (and any collateral agency or trustee or similar agreement relating
thereto).
"Preferred Stock" means the 10-1/2% Senior Exchangeable Preferred
---------------
Stock Due 2008 of GCHL.
"Prepayment Event" means:
----------------
(a) any sale, transfer or other disposition (including pursuant to a
sale and leaseback transaction) of any property or asset of any Restricted
Person, other than (i) dispositions described in paragraphs (a), (b), (g),
(h) and (i) of Section 6.05 and (ii) any other disposition (or series of
dispositions) as to which the Net Proceeds do not exceed $25,000,000;
(b) any casualty or other insured damage to, or any taking under
power of eminent domain or by condemnation or similar proceeding of, any
property or asset of any Restricted Person, but only to the extent that the
Net Proceeds therefrom have not been applied to repair, restore or replace
such property or asset, or to reimburse such Restricted Person for
expenditures previously made for such purposes, within 360 days after such
event (but in no event earlier than the date which is 5 Business Days after
the date of receipt of such Net Proceeds); or
(c) any sale, transfer or other disposition (including pursuant to a
sale and leaseback transaction) of any property or asset of any Restricted
Person that would require any redemption of any preferred stock that is not
Disqualified Stock absent the requirement that the proceeds thereof be
applied to prepay Loans.
"Prime Rate" means the rate of interest per annum publicly announced
----------
from time to time by The Chase Manhattan Bank as its prime rate in effect at its
principal office in New
Credit Agreement
----------------
-26-
York City; each change in the Prime Rate shall be effective from and including
the date such change is publicly announced as being effective.
"Pro Forma Basis" means, as of any date (the "current date"), for
--------------- ------------
purposes of determining compliance under specified provisions of this Agreement
with Section 6.12 or 6.13 calculated as of the last day of the most recently
ended fiscal quarter of Limited for which financial statements are then
available, a computation as if any material acquisition or disposition of
assets, any related incurrence or repayment of Indebtedness, any issuance of
preferred stock, any designation of a Restricted Subsidiary as an Unrestricted
Subsidiary and any designation of an Unrestricted Subsidiary as a Restricted
Subsidiary that occurred during the period from but excluding the last day of
such fiscal quarter to and including the current date (and giving effect to any
such transactions proposed to be consummated on the current date pursuant to the
applicable provisions of this Agreement and, in the case of any acquisition,
without giving effect to operating expense reductions) had in fact occurred on
the first day of each relevant four quarter period for testing such compliance.
"Purchase Money Indebtedness" means Indebtedness incurred to finance
---------------------------
the acquisition, construction, development, installation or improvement of any
fixed or capital assets, including Capital Lease Obligations and any
Indebtedness assumed in connection with the acquisition of any such assets or
secured by a Lien on any such assets prior to the acquisition thereof, and
extensions, renewals and replacements of any such Indebtedness that do not
increase the outstanding principal amount thereof or result in an earlier
maturity date or decreased weighted average life thereof; provided that such
--------
Indebtedness is incurred or assumed prior to or within 90 days after such
acquisition or the completion of such construction or improvement.
"Reaffirmation Agreement" means an agreement substantially in the form
-----------------------
of Exhibit F or, if required or to the extent advisable in a jurisdiction
outside the United States, another form of agreement providing for the
reaffirmation of the grant of security to the Administrative Agent under the
Security Documents executed and delivered pursuant to the Existing Credit
Agreement.
"Receivables Entity" means a wholly owned Subsidiary of Limited (or
------------------
another Person in which Limited or any Restricted Subsidiary may make an
investment and to which Limited or any Restricted Subsidiary transfers
receivables and related assets) which engages in no activities other than in
connection with the financing of receivables and which is designated by the
Board of Directors of GCHL or GCNA (as provided below) as a Receivables Entity,
(a) no portion of the Indebtedness or any other obligations (contingent or
otherwise) of which (i) is guaranteed by any Restricted Person (excluding
guarantees of obligations, other than the principal of, and interest on,
Indebtedness, under Standard Securitization Undertakings), (ii) is recourse to
or obligates any Restricted Person in any way other than pursuant to Standard
Securitization Undertakings or (iii) subjects any property or asset of any
Restricted Person, directly or indirectly, contingently or otherwise, to the
satisfaction thereof, other than the receivables sold into the applicable
Permitted Securitization and other than pursuant to Standard Securitization
Undertakings, (b) with which no Restricted Person has any material contract,
Credit Agreement
----------------
-27-
agreement, arrangement or understanding other than on terms no less favorable to
any Restricted Person than those that might be obtained at the time from Persons
that are not Affiliates of any Restricted Person, other than fees payable in the
ordinary course of business in connection with servicing receivables, and (c) to
which no Restricted Person has any obligation to maintain or preserve such
entity's financial condition or cause such entity to achieve certain levels of
operating results. Any such designation by the Board of Directors of GCHL or
GCNA shall be evidenced to the Administrative Agent by filing with the
Administrative Agent a certified copy of the resolution of such Board of
Directors giving effect to such designation and an officers' certificate of the
applicable Borrower certifying that such designation complied with the foregoing
conditions.
"Register" has the meaning set forth in Section 9.04.
--------
"Related Parties" means, with respect to any specified Person, such
---------------
Person's Affiliates and the respective directors, trustees, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Revolving
----------------
Exposures, Term Loans and unused Commitments representing more than 50% of the
sum of the total Revolving Exposures, outstanding Term Loans and unused
Commitments at such time.
"Restatement Effective Date" means the date upon which the conditions
--------------------------
to effectiveness set forth in Section 4.01 shall have been satisfied or waived.
"Restricted Indebtedness" means Indebtedness of any Restricted Person,
-----------------------
the payment, prepayment, redemption, repurchase or defeasance of which is
restricted under Section 6.08(b).
"Restricted Payment" means any dividend or other distribution (whether
------------------
in cash, securities or other property) with respect to any Equity Interests in
any Restricted Person, 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 Equity Interests in any Restricted Person or any option, warrant or other
right to acquire any such Equity Interests in any Restricted Person; provided
--------
that no such dividend, distribution or payment shall constitute a "Restricted
Payment" to the extent made solely in Equity Interests in Limited (other than
Disqualified Stock).
"Restricted Person" means each of Limited, GCHL, GCNA and the
-----------------
Restricted Subsidiaries.
"Restricted Subsidiary" means any Subsidiary that is not an
---------------------
Unrestricted Subsidiary, and shall in any event include the following Persons,
which may not be designated as Unrestricted Subsidiaries without the prior
consent of the relevant Supermajority Lenders and compliance with the other
requirements set forth in the definition of "Unrestricted Subsidiary": (a)
GCHL, (b) each Subsidiary specified as a Restricted Subsidiary on Schedule 3.12
and each
Credit Agreement
----------------
-28-
direct or indirect subsidiary of any of them as of the Restatement Effective
Date (other than any such direct or indirect subsidiary specified on Schedule
3.12 as an Unrestricted Subsidiary), (c) GCNA and each direct or indirect
subsidiary of GCNA as of the Restatement Effective Date, other than GlobalCenter
and its subsidiaries, any holding company that directly owns Equity Interests in
GlobalCenter, and the LECs and (d) each other direct or indirect Subsidiary of
Limited whose business activities constitute a material component (determined as
provided below) of the specific business conducted or anticipated to be
conducted by any Subsidiary (an "Existing Subsidiary") that is either specified
-------------------
in the foregoing clauses (a), (b) or (c) or that is a direct or indirect
subsidiary of any Subsidiary specified in the foregoing clauses (a), (b) or (c).
Unrestricted Subsidiaries may be designated as Restricted Subsidiaries in
compliance with the requirements set forth in the definition of "Unrestricted
Subsidiary".
In determining whether a Subsidiary conducts a business activity that
is a "material component" as contemplated above of the specific business
------------------
conducted or anticipated to be conducted by any Existing Subsidiary, any
Subsidiary described below shall be included:
(A) any Subsidiary to which any material amount of assets owned, or
business conducted, by an Existing Subsidiary on the Restatement Effective
Date are transferred, sold or otherwise disposed of after the Restatement
Effective Date;
(B) any Subsidiary that owns assets or conducts a business that
constitutes an enhancement or upgrade to the assets or business conducted
by an Existing Subsidiary on the Restatement Effective Date to the extent
such enhancements or upgrades become or are intended to become an integral
part of the systems or operations conducted by such Existing Subsidiary,
whether such enhancements or upgrades arise out of capital expenditures or
out of the acquisition of assets or business; and
(C) any Subsidiary that provides the same service in the same
geographic region to the customer base served by an Existing Subsidiary,
even though that service may be offered by means of an alternate or
competing technology, if the net result of the operation of such service is
to divert a substantial amount of the current or currently anticipated
revenues of such Existing Subsidiary.
"Revolving" refers to the Revolving Credit Borrowings, Commitments and
---------
Loans, and to the Revolving Term Borrowings, Commitments and Loans during the
Revolving Term Availability Period.
"Revolving Credit Availability Period" means the period from and
------------------------------------
including the Original Effective Date to but excluding the earlier of the
Revolving Credit Maturity Date and the date of termination of the Revolving
Credit Commitments.
"Revolving Credit Commitment" means, with respect to each Lender, the
---------------------------
commitment, if any, of such Lender to make Revolving Credit Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, expressed as
an amount representing the maximum aggregate amount of such Lender's Revolving
Credit Exposure
Credit Agreement
----------------
-29-
hereunder, as such commitment may be (a) reduced from time to time pursuant to
Section 2.08 and (b) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04. The amount of each
Lender's Revolvi