364-DAY REVOLVING CREDIT AND TERM LOAN AGREEMENT
among
WORLDCOM, INC.,
Borrower
NATIONSBANK OF TEXAS, N.A.,
Administrative Agent
and
THE LENDERS NAMED HEREIN,
Lenders
$1,250,000,000
DATED AS OF FEBRUARY 19, 1998
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TABLE OF CONTENTS
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SECTION 1 DEFINITIONS AND TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Number and Gender of Words; Other References . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
1.3 Accounting Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2 BORROWING PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.1 Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.2 Competitive Bid Subfacility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.3 Conversion of Facility to Term Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.4 Termination of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.5 Borrowing Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 3 TERMS OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3.1 Loan Accounts, Notes, and Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3.2 Interest and Principal Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
3.3 Interest Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.4 Quotation of Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.5 Default Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.6 Interest Recapture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.7 Interest Calculations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.8 Maximum Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.9 Interest Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.10 Conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.11 Order of Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.12 Sharing of Payments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
3.13 Offset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
3.14 Booking Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
3.15 Basis Unavailable or Inadequate for Eurodollar Rate . . . . . . . . . . . . . . . . . . . . . . . . 29
3.16 Additional Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
3.17 Change in Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.18 Consequential Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.19 Negative Pledge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 4 FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
4.1 Treatment of Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
4.2 Fees of Administrative Agent and Arranger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
4.3 Competitive Bid Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
4.4 Commitment Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 5 CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
5.1 Conditions Precedent to Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
5.2 Conditions Precedent to a Permitted Acquisition. . . . . . . . . . . . . . . . . . . . . . . . . . . 32
5.3 Conditions Precedent to Each Borrowing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 6 REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
6.1 Purpose of Credit Facility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
6.2 Existence, Good Standing, Authority, and Authorizations . . . . . . . . . . . . . . . . . . . . . . 34
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6.3 Subsidiaries; Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.4 Authorization and Contravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.5 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6.6 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6.7 Litigation, Claims, Investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6.8 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6.9 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.10 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.11 Properties; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.12 Government Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.13 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.14 Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.15 Material Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.16 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.17 Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.18 Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.19 Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.20 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.21 Regulation U . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.22 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 7 COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.1 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.2 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.3 Items to be Furnished . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.4 Inspections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
7.5 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
7.6 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
7.7 Maintenance of Existence, Assets, and Business . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
7.8 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
7.9 Preservation and Protection of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
7.10 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
7.11 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
7.12 Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
7.13 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
7.14 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
7.15 Compliance with Laws and Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.16 Permitted Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.17 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.18 Fiscal Year and Accounting Methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.19 Government Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.20 Loans, Advances, and Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.21 Permitted Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
7.22 Restrictions on Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
7.23 Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
7.24 Sale-Leaseback Financings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
7.25 Amendments to Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
7.26 Mergers and Dissolutions; Sale of Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . 47
7.27 Designation of Unrestricted Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
7.28 Financial Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
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SECTION 8 DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.1 Payment of Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.2 Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.3 Debtor Relief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.4 Judgments and Attachments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.5 Government Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.6 Misrepresentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.7 SEC Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.8 Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.9 Authorizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.10 Default Under Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.11 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.12 Validity and Enforceability of Loan Papers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.13 Payment of Certain Other Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.14 Default or Acceleration under any Certain Other Debt . . . . . . . . . . . . . . . . . . . . . . . . 51
8.15 Redemption of Certain Other Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 9 RIGHTS AND REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
9.1 Remedies Upon Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
9.2 Company Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
9.3 Performance by Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
9.4 Delegation of Duties and Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
9.5 Not in Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
9.6 Course of Dealing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
9.7 Cumulative Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
9.8 Application of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
9.9 Certain Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
9.10 Limitation of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
9.11 Expenditures by Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
9.12 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 10 AGREEMENT AMONG LENDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
10.1 Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
10.2 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
10.3 Proportionate Absorption of Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
10.4 Delegation of Duties; Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
10.5 Limitation of Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
10.6 Default; Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
10.7 Limitation of Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
10.8 Relationship of Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
10.9 Foreign Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
10.10 Benefits of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 11 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
11.1 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
11.2 Nonbusiness Days . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
11.3 Communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
11.4 Form and Number of Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
11.5 Exceptions to Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
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11.6 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
11.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
11.8 Invalid Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
11.9 Entirety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
11.10 Jurisdiction; Venue; Service of Process; Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . 61
11.11 Amendments, Consents, Conflicts, and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
11.12 Multiple Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
11.13 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
11.14 Successors and Assigns; Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . 63
11.15 Discharge Only Upon Payment in Full; Reinstatement in Certain Circumstances . . . . . . . . . . . . 65
11.16 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
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SCHEDULES AND EXHIBITS
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Schedule 2.1 - Lenders and Commitments
Schedule 5.1 - Conditions Precedent to Closing
Schedule 6.2 - Subsidiaries
Schedule 6.3 - Warrants, Options, or Other Rights
Schedule 6.13 - Transactions with Affiliates
Schedule 7.12 - Existing Debt
Schedule 7.13 - Existing Liens
Schedule 7.20 - Other Investments
Exhibit A-1 - Form of Revolving/Term Note
Exhibit A-2 - Form of Competitive Bid Note
Exhibit B-1 - Form of Notice of Borrowing
Exhibit B-2 - Form of Notice of Conversion
Exhibit B-3 - Form of Competitive Bid Request
Exhibit B-4 - Form of Notice to Lenders of Competitive Bid Request
Exhibit B-5 - Form of Competitive Bid
Exhibit B-6 - Form of Term Conversion Request
Exhibit C - Form of Administrative Questionnaire
Exhibit D-1 - Form of Compliance Certificate
Exhibit D-2 - Form of Permitted Acquisition Compliance Certificate
Exhibit E - Form of Assignment and Acceptance Agreement
Exhibit F-1 - Form of Opinion of General Counsel of Borrower
Exhibit F-2 - Form of Opinion of Special Communications Counsel
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364-DAY REVOLVING CREDIT AND TERM LOAN AGREEMENT
THIS AGREEMENT is entered into as of February 19, 1998, among
WORLDCOM, INC., a Georgia corporation ("BORROWER"), the Lenders (hereafter
defined) listed on SCHEDULE 2.1 attached hereto, and NATIONSBANK OF TEXAS,
N.A., as a Lender and as Administrative Agent (hereinafter defined) for itself
and the other Lenders.
RECITALS
A. Borrower has requested that Lenders extend credit to Borrower
in the form of the Agreement (hereinafter defined), providing for a 364-day
revolving credit and term loan facility, in the aggregate principal amount of
$1,250,000,000, to finance the tender offer, exchange offer, consent
solicitation, or other acquisition by Borrower of the Brooks Notes (hereafter
defined); provided, that, up to $300,000,000 of the proceeds may be used to
finance loan and advances to Brooks Fiber Properties, Inc. ("BROOKS") to fund
working capital and to use for general corporate purposes.
B. Upon and subject to the terms and conditions of this
Agreement, Lenders are willing to extend such credit to Borrower.
Accordingly, in consideration of the mutual covenants contained
herein, Borrower, Administrative Agent, and Lenders agree as follows:
SECTION 1 DEFINITIONS AND TERMS.
1.1 Definitions. As used herein:
ACCOUNTS RECEIVABLE FINANCING means any transaction or series of
transactions that may be entered into by any Consolidated Company pursuant to
which such Consolidated Company may sell, convey, grant a security interest in,
or otherwise transfer, undivided percentage interests in the Receivables
Program Assets; provided that, for purposes of determinations made pursuant to
SECTIONS 7.23(e) and 7.12(g), any Accounts Receivable Financing involving a
sale of Receivables Program Assets to the Receivables Subsidiary by any
Restricted Company and a subsequent substantially concurrent resale of such
Receivables Program Assets, or an interest therein, to a third party shall be
treated as a single Accounts Receivable Financing transaction.
ACCOUNTS RECEIVABLE FINANCING AMOUNT means, with respect to any
Accounts Receivable Financing and without duplication, the aggregate
outstanding principal amount of the undivided percentage interests in the
Receivables Program Assets, representing Rights to be paid a specified
principal amount from such Receivables Program Assets.
ACQUISITION means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
by any Restricted Company of all or substantially all of the assets of a Person
or of any business or division of a Person, (b) the acquisition by any
Restricted Company of more than 50% of any class of Voting Stock (or similar
ownership interests) of any Person (provided that, formation or organization of
any entity shall not constitute an "Acquisition" to the extent that the amount
of the loan, advance, investment, or capital contribution in such entity
constitutes a permitted investment under SECTION 7.20); or (c) a merger,
consolidation, amalgamation, or other combination by any Restricted Company
with another Person if a Restricted Company is the surviving
<PAGE> 8
entity; provided that, in any merger involving Borrower, Borrower or a
Permitted Successor Corporation must be the surviving entity.
ADJUSTED EURODOLLAR RATE means, for any Eurodollar Rate Borrowing for
any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined by the Administrative Agent
to be equal to the quotient obtained by dividing (a) the Eurodollar Rate for
such Eurodollar Rate Borrowing for such Interest Period by (b) 1 minus the
Reserve Requirement for such Eurodollar Rate Borrowing for such Interest
Period.
ADMINISTRATIVE AGENT means NationsBank of Texas, N.A., and its
permitted successor or successors as administrative agent for Lenders under
this Agreement.
ADMINISTRATIVE QUESTIONNAIRE means an Administrative Questionnaire
substantially in the form of EXHIBIT C hereto, which each Lender shall complete
and provide to Administrative Agent.
AFFILIATE of any Person means any other individual or entity who
directly or indirectly controls, or is controlled by, or is under common
control with, such Person, and, for purposes of this definition only,
"control," "controlled by," and "under common control with" mean possession,
directly or indirectly, of power to direct or cause the direction of management
or policies (whether through ownership of voting securities, by contract, or
otherwise).
AGREEMENT means this 364-Day Revolving Credit and Term Loan Agreement
(as the same may hereafter be amended, modified, supplemented, or restated from
time to time).
ANNUALIZED OPERATING CASH FLOW means, for any Person, an amount equal
to the product of four (4) multiplied by the amount of the Operating Cash Flow
for the relevant period for calculation (subject to adjustments as set forth in
the definition of "Operating Cash Flow"). The relevant period for calculation
of Annualized Operating Cash Flow of the Consolidated Companies on any date of
determination shall be (a) for purposes of SECTION 7.28, the three-month period
then ending for which financial results are available, and (b) for all other
purposes under the Loan Papers, the then most recently ended fiscal quarter for
which quarterly or annual Financial Statements calculated for the Consolidated
Companies on a consolidated basis have been delivered by Borrower pursuant to
SECTIONS 7.3(a) and 7.3(b).
APPLICABLE MARGIN means the lowest percentage set forth in the table
below for the Type of Borrowing or commitment fees (as the case may be) which
corresponds to Borrower's conformity, on any date of determination, with either
the (i) Leverage Ratio or (ii) the ratings (or implied ratings) established by
both S&P and Moody's applicable to Borrower's senior, unsecured,
non-credit-enhanced long term indebtedness for borrowed money ("INDEX DEBT"):
2
<PAGE> 9
<TABLE>
<CAPTION>
APPLICABLE MARGIN
--------------------------------------------------------------------
RATINGS LEVERAGE RATIO BASE RATE EURODOLLAR RATE COMMITMENT
BORROWINGS BORROWINGS FEES
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Category 1
----------
Equal to or higher than BBB+
by S&P; Less than 2.00:1.0 0.000% 0.300% 0.070%
Equal to or higher than Baa1
by Moody's
-----------------------------------------------------------------------------------------------------------------------------
Category 2
----------
Greater than or equal
BBB by S&P; to 2.00:1.0, 0.000% 0.350% 0.090%
but less than 2.50:1.0
Baa2 by Moody's
-----------------------------------------------------------------------------------------------------------------------------
Category 3
----------
Greater than or equal
BBB- by S&P; to 2.50:1.0, 0.000% 0.400% 0.100%
but less than 3.50:1.0
Baa3 by Moody's
-----------------------------------------------------------------------------------------------------------------------------
Category 4
----------
Greater than or equal
BB+ by S&P; to 3.50:1.0, 0.000% 0.500% 0.150%
but less than 4.0:1.0
Ba1 by Moody's
-----------------------------------------------------------------------------------------------------------------------------
Category 5
----------
Equal to BB or lower by S&P; Greater than or equal 0.000% 0.750% 0.225%
to 4.0:1.0
Equal to Ba2 or lower by
Moody's
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
For purposes of determining the Applicable Margin:
(a) With respect to the debt ratings criteria: (i) if
neither Moody's nor S&P shall have in effect a rating for Index Debt
(other than by reason of the circumstances referred to in the last
sentence of this definition), then both such rating agencies will be
deemed to have established ratings for Index Debt in Category 5; (ii)
if only one of Moody's or S&P shall have in effect a rating for Index
Debt, Borrower and the Lenders will negotiate in good faith to agree
upon another rating agency to be substituted by an agreement for the
rating agency which shall not have a rating in effect, and in the
absence of such agreement the Applicable Margin will be determined by
reference to the available rating; (iii) if the ratings established by
Moody's and S&P shall differ by one Category, the Applicable Margin
shall be determined by reference to the numerically lower Category:
(for example, if the rating from S&P is in Category 1 and the rating
from Moody's is in Category 2, the Applicable Margin shall be
determined by reference to Category 1); (iv) if the ratings
established by Moody's and S&P shall differ by more than one Category,
the Applicable Margin shall be determined by reference to the Category
that is one numerical
3
<PAGE> 10
Category lower than the numerically higher of the two Categories
corresponding to the ratings established by the two rating agencies:
(for example, if the rating from S&P is in Category 2 and the rating
from Moody's is in Category 5, the Applicable Margin shall be
determined by reference to Category 4); and (iv) 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 either Moody's or S&P), 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 either Moody's or S&P shall change prior to the payment in
full of the Obligation and the cancellation of all commitments to lend
hereunder, Borrower and the Lenders shall negotiate in good faith to
amend the references to specific ratings in this definition to reflect
such changed rating system. If both Moody's and S&P shall cease to be
in the business of rating corporate debt obligations, Borrower and the
Lenders shall negotiate in good faith to agree upon a substitute
rating agency and to amend the references to specific ratings in this
definition to reflect the ratings used by such substitute rating
agency.
(b) Until the second Business Day after the initial
Financial Statements and Compliance Certificate for the fiscal quarter
ending March 31, 1998, shall have been delivered hereunder, the
Applicable Margin for Leverage Ratio purposes shall be deemed to be
0.0% for Base Rate Borrowings, and 0.40% for Eurodollar Rate
Borrowings. With respect to any adjustments in the Applicable Margin
as a result of changes in the Leverage Ratio, such adjustment shall be
effective commencing on the second Business Day after the delivery of
Financial Statements (and related Compliance Certificate) pursuant to
SECTIONS 7.3(a) and 7.3(b) or the most recent Notice of Borrowing or
Permitted Acquisition Compliance Certificate for a Permitted
Acquisition, as the case may be.
(c) During any time that the Applicable Margin is
determined with respect to the Leverage Ratio, if Borrower fails to
timely furnish to Lenders the Financial Statements and related
Compliance Certificates as required to be delivered pursuant to
SECTIONS 7.3(a) and 7.3(b), and such failure shall not be remedied
within five days after written notice thereof from the Administrative
Agent or any Lender, then the Applicable Margin shall be the lesser of
(i) the then-effective Applicable Margin with respect to the debt
rating criteria, if any, or (ii) the maximum Applicable Margin
specified in the table above for Category 5.
(d) On the 271st day following the Closing Date, the
Applicable Margin for all Eurodollar Rate Borrowings shall be
increased by 0.125%.
ARRANGER means NationsBanc Montgomery Securities LLC, and its
successors and assigns.
ASSUMED TAXES means, with respect to any Equity Issuance, an amount
equal to such incremental annual increase in franchise Taxes as Borrower
estimates in good faith shall be payable as a result of such Equity Issuance.
AUTHORIZATIONS means all filings, recordings, and registrations with,
and all validations or exemptions, approvals, orders, authorizations, consents,
franchises, licenses, certificates, and permits from, any Governmental
Authority (including, without limitation, the FCC and applicable PUCs),
including without limitation, any of the foregoing authorizing or permitting
the acquisition, construction, or operation of network facilities or any other
telecommunications system.
BASE RATE means, for any day, the rate per annum equal to the higher
of (a) the Federal Funds Rate for such day plus one-half of one percent (.5%)
and (b) the Prime Rate for such day. Any change
4
<PAGE> 11
in the Base Rate due to a change in the Prime Rate or the Federal Funds Rate
shall be effective on the effective date of such change in the Prime Rate or
Federal Funds Rate.
BASE RATE BORROWING means a Borrowing bearing interest at the sum of
the Base Rate plus the Applicable Margin for Base Rate Borrowings.
BORROWER is defined in the preamble to this Agreement.
BORROWING means any amount disbursed (a) by one or more Lenders to
Borrower under the Loan Papers (under the Competitive Bid Subfacility or
otherwise), whether such amount constitutes an original disbursement of funds
or the continuation of an amount outstanding, or (b) by any Lender in
accordance with, and to satisfy the obligations of any Restricted Company
under, any Loan Paper.
BORROWING DATE is defined in SECTION 2.5(a).
BROOKS is defined in the recitals to this Agreement.
BROOKS NOTE TRANSACTION means, the contemplated tender offer, exchange
offer, consent solicitation, or other acquisition by Borrower of the Brooks
Notes, consummated in a manner and upon terms and conditions reasonably
satisfactory to Administrative Agent.
BROOKS NOTES means, collectively or individually, (a) the 10% Senior
Notes due 2007, issued under the Indenture dated as of May 29, 1997, between
Brooks and The Bank of New York, as Trustee, (b) the 10 7/8% Senior Discount
Notes due 2006, issued under the Indenture dated as of February 26, 1996,
between Brooks and The Bank of New York, as Trustee, and (c) the 11 7/8% Senior
Discount Notes due 2006, issued under the Indenture dated as of November 7,
1996, between Brooks and The Bank of New York, as Trustee.
BROOKS NOTE AGREEMENTS means, collectively or individually, (a) the
Indenture dated as of May 29, 1997, between Brooks and the Bank of New York, as
Trustee, pursuant to which the 10% Senior Notes of Brooks were issued (as the
same may have been and may hereafter be supplemented, amended, and modified,
subject to the provisions of SECTION 7.25 on and after the date upon which
Brooks and its Subsidiaries are redesignated as Restricted Subsidiaries); (b)
the Indenture dated as of February 26, 1996, between Brooks and the Bank of New
York, as Trustee, pursuant to which the 10 7/8% Senior Discount Notes of Brooks
were issued (as the same may have been and may hereafter be supplemented,
amended, and modified, subject to the provisions of SECTION 7.25 on and after
the date upon which Brooks and its Subsidiaries are redesignated as Restricted
Subsidiaries); and (c) the Indenture dated as of November 7, 1996, between
Brooks and the Bank of New York, as Trustee, pursuant to which the 11 7/8%
Senior Discount Notes of Brooks were issued (as the same may have been and may
hereafter be supplemented, amended, and modified, subject to the provisions of
SECTION 7.25 on and after the date upon which Brooks and its Subsidiaries are
redesignated as Restricted Subsidiaries).
BUSINESS DAY means (a) for all purposes, any day other than Saturday,
Sunday, and any other day on which commercial banking institutions are required
or authorized by Law to be closed in New York, New York, and (b) in addition to
the foregoing, in respect of any Eurodollar Rate Borrowing, a day on which
dealings in United States dollars are conducted in the London interbank market
and commercial banks are open for international business in London.
5
<PAGE> 12
CAPITAL LEASE means any capital lease or sublease which should be
capitalized on a balance sheet in accordance with GAAP.
CLOSING DATE means the date upon which this Agreement has been
executed by Borrower, Administrative Agent, and Lenders and all conditions
precedent specified in SECTION 5.1 have been satisfied or waived.
CODE means the Internal Revenue Code of 1986, as amended, together
with rules and regulations promulgated thereunder.
COMMITMENT means an amount (subject to reduction or cancellation as
herein provided) equal to $1,250,000,000.
COMMITMENT PERCENTAGE means the proportion that any Lender's Committed
Sum bears to the Commitment then in effect.
COMMITTED SUM means the amount stated beside each Lender's name on the
most-recently amended SCHEDULE 2.1 to the Agreement (which amount is subject to
increase, reduction, or cancellation in accordance with this Agreement).
COMPETITIVE BID means an offer by a Lender to fund a Borrowing under
the Competitive Bid Subfacility pursuant to SECTION 2.4.
COMPETITIVE BID AVAILABILITY means, on any date of determination
thereof, 100% of the then-effective Commitment.
COMPETITIVE BID NOTE means a promissory note in substantially the form
of EXHIBIT A-2, and all renewals and extensions of all or any part thereof.
COMPETITIVE BID RATE means, as to any Competitive Bid made by a Lender
pursuant to SECTION 2.2, (a) in the case of a Eurodollar Rate Borrowing, the
margin which shall be added to or subtracted from the Adjusted Eurodollar Rate,
and (b) in the case of a Fixed Rate Borrowing, the fixed rate of interest, in
each case, offered by the Lender making such Competitive Bid.
COMPETITIVE BID REQUEST means a request for Competitive Bids made
pursuant to SECTION 2.2(b) substantially in the form of EXHIBIT B-3.
COMPETITIVE BID SUBFACILITY means the subfacility described in and
subject to the limitations of SECTION 2.2.
COMPETITIVE BORROWING means any Borrowing under the Competitive Bid
Subfacility.
COMPLIANCE CERTIFICATE means a certificate signed by a Responsible
Officer, substantially in the form of EXHIBIT D-1.
CONSEQUENTIAL LOSS means any loss or expense which any Lender may
reasonably incur in respect of a Eurodollar Rate Borrowing or a Fixed Rate
Borrowing as a consequence of (a) any failure or refusal of Borrower (for any
reasons whatsoever other than a default by Administrative Agent or a Lender) to
accept or utilize such Borrowing after Borrower shall have requested it under
this Agreement, or (b) any
6
<PAGE> 13
prepayment or payment of such Borrowing or conversion of such Borrowing to a
Borrowing of another Type, in each case, prior to the last day of the Interest
Period therefor.
CONSOLIDATED COMPANIES means, at any date of determination thereof,
Borrower and each of its Subsidiaries (including the Unrestricted
Subsidiaries).
CONSOLIDATED NET INCOME means, for any period, the amount that should,
in accordance with GAAP, be reflected on the Consolidated Companies'
consolidated income statement as net income for that period.
CONSOLIDATED NET WORTH means, for any period, the consolidated
stockholders' equity of the Consolidated Companies as determined in accordance
with GAAP.
CURRENT FINANCIALS means, at the time of any determination thereof,
the more recently delivered to Lenders of either (a) the Financial Statements
of Borrower for the fiscal year ended December 31, 1996, and the nine-month
period ended September 30, 1997, calculated on a consolidated basis for the
Consolidated Companies and the Financial Statements of Brooks and its
consolidated Subsidiaries for the nine-month period ending September 30, 1997;
or (b) the Financial Statements required to be delivered under SECTIONS 7.3(a)
or 7.3(b), as the case may be, separately calculated on a consolidated basis
for the Consolidated Companies.
DEBT means (without duplication), for any Person, the sum of the
following: (a) all liabilities, obligations, and indebtedness of such Person
which in accordance with GAAP should be classified upon such Person's balance
sheet as liabilities in respect of (i) money borrowed, including, without
limitation, the Principal Debt, (ii) obligations of such Person under Capital
Leases, and (iii) obligations of such Person issued or assumed as the deferred
purchase price of property, all conditional sale obligations, and obligations
under any title retention agreement (but excluding trade accounts payable
arising in the ordinary course of business); (b) all obligations of the type
referred to in CLAUSES (a)(i) through (a)(iii) preceding of other Persons for
the payment of which such Person is responsible or liable as obligor,
guarantor, or otherwise; (c) all obligations of the type referred to in CLAUSES
(a)(i) through CLAUSE (a)(iii) and CLAUSE (b) preceding of other Persons
secured by any Lien on any property or asset of such Person (whether or not
such obligation is assumed by such Person), the amount of such obligation being
deemed to be the lesser of the value of such property or assets or the amount
of the obligation so secured; (d) the face amount of all letters of credit and
banker's acceptances issued for the account of such Person, and without
duplication, all drafts drawn and unpaid thereunder; and (e) obligations
arising under any Accounts Receivable Financing which in accordance with GAAP
should be classified upon such Person's balance sheet as liabilities.
DEBTOR RELIEF LAWS means the Bankruptcy Code of the United States of
America and all other applicable liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization, fraudulent
transfer or conveyance, suspension of payments or similar Laws from time to
time in effect affecting the Rights of creditors generally.
DEFAULT is defined in SECTION 8.
DEFAULT RATE means a per annum rate of interest equal from day to day
to the lesser of (a) the sum of the Base Rate plus the Applicable Margin for
Base Rate Borrowings plus 2% and (b) the Maximum Rate.
7
<PAGE> 14
DETERMINING LENDERS means, on any date of determination occurring
prior to the date upon which the Commitment has been terminated, those Lenders
who collectively hold at least 51% of the Commitment (or 51% of the Principal
Debt, if the Facility has been terminated or converted to a Term Loan).
DISTRIBUTION for any Person means, with respect to any shares of any
capital stock or other equity securities issued by such Person, (a) the
retirement, redemption, purchase, or other acquisition for value of any such
securities, (b) the declaration or payment of any dividend on or with respect
to any such securities, and (c) any other payment by such Person with respect
to such securities.
DOLLARS and the symbol $ shall mean lawful money of the United States
of America.
ELIGIBLE ASSIGNEE means (a) a Lender; (b) an Affiliate of a Lender (so
long as such assignment is not made in conjunction with the sale of such
Affiliate); and (c) any other Person approved by Administrative Agent (which
approval will not be unreasonably withheld or delayed by Administrative Agent)
and, unless a Default has occurred and is continuing at the time any assignment
is effected in accordance with SECTION 11.14, Borrower, such approval not to be
unreasonably withheld or delayed by Borrower and such approval to be deemed
given by Borrower if no objection is received by the assigning Lender and the
Administrative Agent from Borrower within five Business Days after notice of
such proposed assignment has been provided by the assigning Lender to Borrower;
provided, however, that neither Borrower nor any Affiliate of Borrower shall
qualify as an Eligible Assignee.
EMPLOYEE PLAN means an employee pension benefit plan covered by Title
IV of ERISA and established or maintained by Borrower or any ERISA Affiliate,
but not including any Multiemployer Plan.
ENVIRONMENTAL LAW means any applicable Law that relates to (a) the
condition or protection of air, groundwater, surface water, soil, or other
environmental media, (b) the environment, including natural resources or any
activity which affects the environment, (c) the regulation of any pollutants,
contaminants, wastes, substances, and Hazardous Substances, including, without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Section 9601 et seq.) ("CERCLA"), the Hazardous
Materials Transportation Act (49 U.S.C. Section 1801 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.) ("RCRA"), the
Clean Water Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act (42
U.S.C. Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C.
Section 2601 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act
(7 U.S.C. Section 136 et seq.), the Safe Drinking Water Act (42 U.S.C. Section
201 and Section 300f et seq.) and the Rivers and Harbors Act (33 U.S.C.
Section 401 et seq.), the Oil Pollution Act (33 U.S.C. Section 2701 et seq.)
and analogous state and local Laws, as any of the foregoing may have been and
may be amended or supplemented from time to time, and any analogous future
enacted or adopted Law, or (d) the Release or threatened Release of Hazardous
Substances.
EQUITY ISSUANCE means the issuance by any Restricted Company of any
shares of any class of stock, warrants, or other equity interests, other than
(a) stock issued by Borrower as payment of all or any portion of the purchase
price for a Permitted Acquisition, (b) present and future shares of stock,
options, or warrants issued to employees, directors or consultants of the
Restricted Companies, or stock issued upon their exercise, and (c) stock issued
upon the exercise of the existing options and warrants described on SCHEDULE
6.3.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations and rulings thereunder.
8
<PAGE> 15
ERISA AFFILIATE means any company or trade or business (whether or not
incorporated) which, for purposes of Title IV of ERISA, is a member of
Borrower's controlled group or which is under common control with Borrower
within the meaning of Section 414(b) or (c) of the Code.
EURODOLLAR RATE means, for any Eurodollar Rate Borrowing for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) appearing on Dow Jones Markets Page 3750 (or any
successor page) as the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period. If for
any reason such rate is not available, the term "Eurodollar Rate" shall mean,
for any Eurodollar Rate Borrowing for any Interest Period therefor, the rate
per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing
on Reuters Screen LIBO Page as the London interbank offered rate for deposits
in Dollars at approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period for a term comparable to such Interest
Period; provided, however, if more than one rate is specified on Reuters Screen
LIBO Page, the applicable rate shall be the arithmetic mean of all such rates
(rounded upwards, if necessary, to the nearest 1/100 of 1%).
EURODOLLAR RATE BORROWING means, as the case may be, either (a) a
Borrowing (other than a Competitive Borrowing) bearing interest at the sum of
the Adjusted Eurodollar Rate plus the Applicable Margin for Eurodollar Rate
Borrowings, or (b) a Competitive Borrowing bearing interest at the sum of the
Adjusted Eurodollar Rate plus or minus the margin indicated for such
Competitive Borrowing in the related Competitive Bid.
EXHIBIT means an exhibit to this Agreement unless otherwise specified.
EXISTING DEBT means the Debt described on SCHEDULE 7.12(d).
EXISTING LIENS means those Liens described on SCHEDULE 7.13.
FACILITY means the credit facility described in SECTION 2.1 and
subject to the limitations of the Agreement.
FACILITY A AGREEMENT means the Facility A Revolving Credit Agreement
dated as of July 3, 1997, among Borrower, Administrative Agent, the Agents and
Co-Agents (as such terms are defined therein), and the Facility A Lenders (as
the same may be amended, modified, supplemented, or restated from time to
time).
FACILITY A LENDERS means, on any date of determination, the financial
institutions named on SCHEDULE 2.1 to the Facility A Agreement (as the same may
be amended from time to time) and their respective successors and assigns, but
not any participant who is not otherwise a party to the Facility A Agreement.
FACILITY B AGREEMENT means the Facility B Revolving Credit and Term
Loan Agreement dated as of July 3, 1997, among Borrower, Administrative Agent,
the Agents and Co-Agents (as such terms are defined therein), and the Facility
B Lenders (as the same may be amended, modified, supplemented, or restated from
time to time).
FACILITY B LENDERS means, on any date of determination, the financial
institutions named on SCHEDULE 2.1 to the Facility B Agreement (as the same may
be amended from time to time) and their
9
<PAGE> 16
respective successors and assigns, but not any Participant who is not otherwise
a party to the Facility B Agreement.
FCC means the Federal Communications Commission and any successor
regulatory body.
FEDERAL FUNDS RATE means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) determined (which
determination shall be conclusive and binding, absent manifest error) by
Administrative Agent to be equal to the weighted average of the rates on
overnight Federal funds transactions with member banks of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding such day;
provided that, (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Administrative
Agent (in its individual capacity) on such day on such transactions as
determined by Administrative Agent (which determination shall be conclusive and
binding, absent manifest error).
FINANCIAL HEDGE means either (a) a swap, collar, floor, cap, or other
contract which is intended to reduce or eliminate the risk of fluctuations in
interest rates, or (b) a foreign exchange, currency hedging, commodity hedging,
or other contract which is intended to reduce or eliminate the market risk of
holding currency or a commodity in either the cash or futures markets, which
Financial Hedge under either CLAUSE (a) or CLAUSE (b) is entered into by any
Restricted Company with any Lender or an Affiliate of any Lender or any other
Person under the Laws of a jurisdiction in which such contracts are legal and
enforceable (except as enforceability may be limited by applicable Debtor
Relief Laws and general principles of equity).
FINANCIAL STATEMENTS means balance sheets, statements of operations,
statements of shareholders' investments, and statements of cash flows prepared
in accordance with GAAP, which statements of operations and statements of cash
flows shall be in comparative form to the corresponding period of the preceding
fiscal year, and which balance sheets and statements of shareholders'
investments shall be in comparative form to the prior fiscal year-end figures.
FIXED RATE BORROWING means any Competitive Borrowing made from a
Lender pursuant to SECTION 2.2 based upon an actual percentage rate per annum
offered by such Lender, expressed as a decimal (to no more than four decimal
places) and accepted by Borrower.
GAAP means generally accepted accounting principles of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
the Financial Accounting Standards Board which (a) with respect to the
covenants contained in SECTION 7.28 and the defined terms "ANNUALIZED OPERATING
CASH FLOW," "INTEREST EXPENSE," "LEVERAGE RATIO," and "OPERATING CASH FLOW,"
(and, to the extent used in or relating to such covenants or such defined
terms, any other defined terms), are in effect on the date hereof, and (b) for
all other purposes hereunder, are applicable from time to time.
GOVERNMENTAL AUTHORITY means any (a) local, state, municipal, or
federal judicial, executive, or legislative instrumentality, (b) private
arbitration board or panel, or (c) central bank.
HAZARDOUS SUBSTANCE means (a) any substance that is designated,
defined or classified as a hazardous waste, hazardous material, pollutant,
contaminant or toxic or hazardous substance under any Environmental Law,
including without limitation, any hazardous substance within the meaning of
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Section 101(14) of CERCLA, (b) petroleum, oil, gasoline, natural gas, fuel oil,
motor oil, waste oil, diesel fuel, jet fuel, and other petroleum hydrocarbons,
(c) regulated asbestos and asbestos-containing materials in any form, (d)
polychlorinated biphenyls, or (e) urea formaldehyde foam.
INTEREST EXPENSE means, for any period of calculation thereof, for any
Person, all interest (including commitment fees) on all Debt of such Person,
whether paid in cash or accrued as a liability and payable in cash during such
period (including, without limitation, imputed interest on Capital Lease
obligations) and all cash premiums or penalties for repayment, redemption, or
repurchase of Debt.
INTEREST PERIOD is determined in accordance with SECTION 3.9.
LAWS means all applicable statutes, laws, treaties, ordinances, tariff
requirements, rules, regulations, orders, writs, injunctions, decrees,
judgments, opinions, or interpretations of any Governmental Authority.
LENDERS means, on any date of determination, the financial
institution(s) named on SCHEDULE 2.1 (as the same may be amended from time to
time by Administrative Agent to reflect the assignments made in accordance with
SECTION 11.14(c) of this Agreement) and subject to the terms and conditions of
this Agreement, and their respective successors and assigns, but not any
Participant who is not otherwise a party to this Agreement.
LEVERAGE RATIO means, on any date of determination thereof, the ratio
of (a) Total Debt outstanding, minus (i) the amount of any
immediately-available cash or Cash Equivalents owned by the Restricted
Companies, and (ii) the market value (determined as of any date of
determination) of any immediately-available Marketable Securities owned by the
Restricted Companies, to (b) Annualized Operating Cash Flow of the Consolidated
Companies. The Leverage Ratio shall be (x) determined, for purposes of SECTION
7.28, as of any such date of determination, and (y) determined for all other
purposes under the Loan Papers, from the then most current of (A) the quarterly
or annual Financial Statements calculated for the Consolidated Companies on a
consolidated basis and related Compliance Certificate delivered by Borrower
pursuant to SECTIONS 7.3(a) and 7.3(b), or (B) the most recent Notice of
Borrowing for a Permitted Acquisition or any Permitted Acquisition Compliance
Certificate, calculating any adjustments to the Leverage Ratio necessitated as
a result of the Permitted Acquisition. As used in this definition:
(i) the term "immediately-available" shall mean that any
such cash, Cash Equivalents, or Marketable Securities are capable of
being liquidated (without premium, penalty, or restriction, other than
premiums, penalties, or restrictions not exceeding in the aggregate
for any marketable security 3% of the market value of such security on
the date of determination) within thirty days of any date of
determination, are not subject to any Liens or claims of third
persons, and are unconditionally available for payment of the
Principal Debt upon liquidation;
(ii) the term "Cash Equivalent" shall mean any investments
of the Restricted Companies which are permitted by SECTION 7.20(a) -
(f), and which mature within 30 days of any date of determination, and
which are unconditionally available for repayment of the Principal
Debt, upon liquidation; and
(iii) the term "Marketable Securities" shall mean any debt
or equity investments in any Person other than a Consolidated Company
(or an Affiliate of any Consolidated Company), which is traded on a
national securities exchange, which is owned of record legally and
beneficially by a Restricted Company, which is free and clear of any
Liens, which is not subject to any restriction
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on transfer or sale (other than restrictions imposed by securities
Laws and general corporate Laws), and which is unconditionally
available for repayment of the Principal Debt upon liquidation.
LIEN means any lien, mortgage, security interest, pledge, assignment,
charge, title retention agreement, or encumbrance of any kind, and any other
Right of or arrangement with any creditor (other than under or relating to
subordination or other intercreditor arrangements) to have its claim satisfied
out of any property or assets, or the proceeds therefrom, prior to the general
creditors of the owner thereof.
LITIGATION means any action by or before any Governmental Authority.
LOAN PAPERS means (a) this Agreement, certificates delivered pursuant
to this Agreement, and Exhibits and Schedules hereto, (b) all agreements,
documents, or instruments in favor of Administrative Agent or Lenders (or
Administrative Agent on behalf of Lenders) ever delivered pursuant to this
Agreement, or otherwise delivered in connection with all or any part of the
Obligation, (c) any Financial Hedge between any Restricted Company and any
Lender or any Affiliate of any Lender, and (d) all renewals, extensions, or
restatements of, or amendments or supplements to, any of the foregoing.
MATERIAL ADVERSE EVENT means any set of one or more circumstances or
events which, individually or collectively, could reasonably be expected to
result in any (a) material impairment of the ability of any Restricted Company
to perform any of its payment or other material obligations under the Loan
Papers or the ability of Administrative Agent or any Lender to enforce any such
obligations or any of their respective Rights under the Loan Papers, (b)
material and adverse effect on the business, properties, condition (financial
or otherwise) or results of operations of the Restricted Companies, in each
case considered as a whole, (c) material and adverse effect on the business,
properties, condition (financial or otherwise) or results of operations of the
Consolidated Companies, in each case considered as a whole, or (d) Default or
Potential Default. The phrase "could be a Material Adverse Event" (and any
similar phrase herein) means that there is a material probability of such
Material Adverse Event occurring, and the phrase "could not be a Material
Adverse Event" (and any similar phrase herein) means that there is not a
material probability of such Material Adverse Event occurring.
MAXIMUM AMOUNT and MAXIMUM RATE respectively mean, for each Lender,
the maximum non-usurious amount and the maximum non-usurious rate of interest
which, under applicable Law, such Lender is permitted to contract for, charge,
take, reserve, or receive on the Obligation.
MFS means MFS Communications Company, Inc., and its successors and
assigns.
MFS NOTE AGREEMENTS means collectively or individually (i) the
Indenture dated as of January 15, 1994, between MFS and IBJ Schroder Bank &
Trust Company, as Trustee, pursuant to which the 9-3/8% Senior Discount Notes
of MFS were issued, as supplemented by the First Supplemental Indenture dated
as of March 31, 1995 (as the same may be further supplemented, amended, and
modified, subject to the provisions of SECTION 7.25 on and after the date upon
which MFS and its Subsidiaries are redesignated as Restricted Subsidiaries) and
(ii) the Indenture dated as of January 15, 1996, between MFS and IBJ Schroder
Bank & Trust Company, as Trustee, as supplemented by the First Supplemental
Indenture dated as of January 15, 1996, pursuant to which the 8-7/8% Senior
Discount Notes of MFS were issued (as the same may be further supplemented,
amended, and modified subject to the provisions of SECTION 7.25 on and after
the date upon which MFS and its Subsidiaries are redesignated as Restricted
Subsidiaries).
MOODY'S means Moody's Investors Service, Inc. or any successor
thereto.
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MULTIEMPLOYER PLAN means a multiemployer plan as defined in Sections
3(37) or 4001(a)(3) of ERISA or Section 414(f) of the Code to which any
Restricted Company or any ERISA Affiliate is making, or has made, or is
accruing, or has accrued, an obligation to make contributions.
NET CASH PROCEEDS means, with respect to any Equity Issuance, cash
(freely convertible into Dollars) (including any cash received by way of
deferred payment pursuant to a promissory note, or otherwise, but only as and
when received) received, on or after the date of such Equity Issuance, by any
Restricted Company from such Equity Issuance, net of usual and customary
transaction costs and expenses and Assumed Taxes.
NOTE AGREEMENTS means, collectively, any indentures or other
agreements pursuant to which notes, debentures, bonds, or debt securities are
issued in accordance with the limitations set forth in SECTION 7.12(F).
NOTES means, at the time of any determination thereof, all outstanding
and unpaid Revolving/Term Notes and Competitive Bid Notes.
NOTICE OF BORROWING is defined in SECTION 2.5(a).
NOTICE OF CONVERSION is defined in SECTION 3.10.
OBLIGATION means all present and future indebtedness, liabilities, and
obligations, and all renewals and extensions thereof, or any part thereof, now
or hereafter owed to Administrative Agent or any Lender by any Restricted
Company arising from, by virtue of, or pursuant to any Loan Paper, together
with all interest accruing thereon, fees, costs, and expenses (including,
without limitation, all attorneys' fees and expenses incurred in the
enforcement or collection thereof) payable under the Loan Papers.
OPERATING CASH FLOW means, for any Person and any period of
calculation thereof, the sum (without duplication and without giving effect to
any extraordinary losses or gains during such period) of (a) pre-tax income or
deficit during such period, plus (b) to the extent already deducted in
computing such pre-tax income, (i) Interest Expense during such period, (ii)
depreciation, amortization, and other non-cash expense items during such
period, and (iii) any non-recurring cash and non-cash merger and restructuring
charges related solely to Acquisitions occurring on or after July 3, 1997 (so
long as the aggregate amount of all adjustments made pursuant to this CLAUSE
(iii) for the entire period on or after July 3, 1997, shall not exceed
$100,000,000) less (c) any income (or plus any loss) attributable to any Person
accounted for on the "equity" method of accounting (other than dividends or
distributions actually received by any Restricted Company from such Person);
provided that, in calculating Operating Cash Flow for the Consolidated
Companies, no more than 7.5% of such Operating Cash Flow may be comprised of
Operating Cash Flow of Unrestricted Subsidiaries. Only for the purpose of the
calculation of the Leverage Ratio with respect to the Consolidated Companies,
Operating Cash Flow of the Consolidated Companies shall be calculated after
giving effect to Acquisitions and divestitures of Restricted Companies
permitted by the Loan Papers during such period as if such transactions had
occurred on the first day of such period, regardless whether the effect is
positive or negative. In the case of any Permitted Acquisition during any
period of calculation, Operating Cash Flow of the Consolidated Companies shall,
for the purposes of the foregoing calculations, be adjusted to give effect to
such Permitted Acquisition, as if such Permitted Acquisition occurred on the
first day of such period, by increasing, if positive, or decreasing, if
negative, the Operating Cash Flow of the Consolidated Companies by the
Operating Cash Flow of such newly-acquired business during such period of
calculation occurring prior to the date of such Permitted Acquisition. In the
case of any Restricted Company being sold, transferred, or otherwise disposed
of by
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any Restricted Company as permitted under the Loan Papers (a "PERMITTED
DISPOSITION") during any period of calculation, Operating Cash Flow shall, for
the purposes of the foregoing calculations be adjusted to give effect to such
Permitted Disposition, as if such Permitted Disposition occurred on the first
day of such period, by decreasing, if positive, or increasing, if negative, the
Operating Cash Flow of the Consolidated Companies by the Operating Cash Flow of
such newly- sold Restricted Companies during such period prior to the date of
the Permitted Disposition. Only for the purpose of the calculation of the
Leverage Ratio with respect to the Consolidated Companies, Operating Cash Flow
of the Consolidated Companies shall be adjusted to give effect to any
designation of a Restricted or Unrestricted Subsidiary on the first day of the
calculation period in which such Subsidiaries are so designated pursuant to
SECTION 7.27 hereof.
PARTICIPANT is defined in SECTION 11.14(e).
PBGC means the Pension Benefit Guaranty Corporation, or any successor
thereof, established pursuant to ERISA.
PERMITTED ACQUISITION means:
(a) Any Acquisition by a Restricted Company with a
Purchase Price of less than $250,000,000, so long as: (i) all
representations and warranties under the Loan Papers are true and
correct immediately prior to and after giving effect to the
Acquisition; and (ii) no Default or Potential Default exists at the
time of the Acquisition and after giving effect to the Acquisition;
provided that, if the Purchase Price for any Acquisition exceeds
$50,000,000 (or, shall exceed $50,000,000 when aggregated with all
other Acquisitions under this ITEM (a) consummated during any fiscal
quarter of the Restricted Companies), Borrower shall certify in
writing (delivered to Administrative Agent) compliance with the
requirements of this ITEM (a) on the closing date of such Acquisition,
and, to the extent applicable, shall comply with the requirements of
SECTION 5.2(b);
(b) Any Acquisition by a Restricted Company with a
Purchase Price of $250,000,000 or more, with respect to which each of
the following requirements shall have been satisfied:
(i) as of the closing of any Acquisition, the
Acquisition has been approved and recommended by the board of
directors or other similar governing body of the Person to be
acquired or from which such business is to be acquired;
(ii) not later than the closing date of the
Acquisition, Borrower shall have delivered to Administrative
Agent a written description of the targeted entity to be
acquired and its operations and a copy of the related purchase
agreement (and, upon the request of Administrative Agent, all
of the schedules and exhibits thereto);
(iii) as of the closing of any Acquisition, after
giving effect to such Acquisition, the acquiring party must be
Solvent and the Restricted Companies, on a consolidated basis,
must be Solvent;
(iv) prior to consummation of any Acquisition,
Borrower shall have satisfied the conditions precedent to a
Permitted Acquisition as set forth in SECTION 5.2;
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(v) as of the closing of any Acquisition, no
Default or Potential Default shall exist or occur as a result
of, and after giving effect to, such Acquisition; and
(vi) as of the closing of any Acquisition, if such
Acquisition is structured as a merger, Borrower or a Permitted
Successor Corporation (or if such merger is with any
Restricted Company other than Borrower, then a Restricted
Company) must be the surviving entity after giving effect to
such merger; and
(c) any other Acquisition for which the prior written
consent of Determining Lenders has been obtained; provided that at the
request of Administrative Agent, Borrower shall have delivered to
Administrative Agent the following: (i) five year income and balance
sheet projections in respect of the Restricted Companies and the
entity to be acquired, after giving effect to such Acquisition; and
(ii) such other information in respect of such Acquisition as
Administrative Agent or Determining Lenders shall have reasonably
requested. Administrative Agent shall, upon request of Borrower,
confirm to Borrower that it has received all such agreements,
documents, instruments, and other information so requested by
Administrative Agent or Determining Lenders.
PERMITTED ACQUISITION COMPLIANCE CERTIFICATE means a certificate
signed by a Responsible Officer of Borrower, substantially in the form of
EXHIBIT D-2.
PERMITTED DEBT means Debt permitted under SECTION 7.12 as described in
such Section.
PERMITTED LIENS means Liens permitted under SECTION 7.13 as described
in such Section.
PERMITTED SUCCESSOR CORPORATION means any corporation into which
Borrower is merged or consolidated, so long as:
(a) immediately after giving effect to such merger or
consolidation, the surviving corporation shall have then-effective
ratings (or implied ratings) published by Moody's and S&P applicable
to such surviving corporation's senior, unsecured,
non-credit-enhanced, long term Debt, which ratings shall be equal to
or higher than the debt ratings of Borrower immediately prior to
giving effect to such merger or consolidation;
(b) such surviving corporation shall be a corporation
organized and existing under the Laws of the United States of America,
any state thereof or the District of Columbia, and shall expressly
assume all of Borrower's obligations for the due and punctual payment
of the Obligation and the performance or observance of the Loan
Papers;
(c) immediately after giving effect to such merger or
consolidation, no Default or Potential Default shall have occurred and
be continuing;
(d) Borrower shall have delivered to Administrative Agent
a certificate signed by a Responsible Officer of Borrower and a
written opinion of counsel satisfactory to the Administrative Agent
(and its counsel), each stating that such merger or consolidation
complies with the requirements for a Permitted Successor Corporation
and that all conditions precedent herein provided for relating to such
merger or consolidation have been satisfied;
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(e) No "Change of Control" (as defined in SECTION 8.8)
has occurred as a result of such merger or consolidation; and
(f) on and prior to the closing of any such merger or
consolidation, such merger and consolidation shall have been approved
and recommended by the board of directors of Borrower.
PERSON means any individual, entity, or Governmental Authority.
POTENTIAL DEFAULT means the occurrence of any event or existence of
any circumstance which, with the giving of notice or lapse of time or both,
would become a Default.
PRIME RATE means the per annum rate of interest established from time
to time by NationsBank of Texas, N.A. as its prime rate, which rate may not be
the lowest rate of interest charged by NationsBank of Texas, N.A. to its
customers.
PRINCIPAL DEBT means, on any date of determination, the aggregate
unpaid principal balance of all Borrowings under this Facility.
PRO RATA or PRO RATA PART means on any date of determination thereof:
(a) for each Lender with respect to allocation of any
principal or interest payments on any Competitive Borrowing -- the
proportion that the outstanding principal amount or accrued and unpaid
interest (as the case may be) owed to any Lender participating in such
Competitive Borrowing bears to the total principal amount outstanding
or accrued and unpaid interest (as the case may be) owed to all
Lenders participating in such Competitive Borrowing; and
(b) for all other purposes, for any Lender, (a) at any
time prior to the termination of the Commitment, the proportion that
such Lender's Committed Sum bears to the Commitment, or (b) at any
time on and after the termination of the Commitment, the proportion
that the Principal Debt owed to such Lender bears to the Principal
Debt.
PUC means any state or local regulatory agency or governmental
authority that exercises jurisdiction over the rates or services or the
ownership, construction, or operation of network facilities or
telecommunications systems or over Persons who own, construct, or operate
network facilities or telecommunications systems.
PURCHASE PRICE means with respect to any Acquisition the "purchase
price" as specified and determined in accordance with the purchase agreement
and other related acquisition documents evidencing such Acquisition.
RECEIVABLES means all Rights of any Consolidated Company (as a
"Seller" under Receivables Documents) to payments (whether constituting
accounts, chattel paper, instruments, general intangibles, or otherwise, and
including the Right to payment of any interest or finance charges) with respect
to dedicated telecommunications services provided by any such Consolidated
Company to its customers between designated customer premises.
RECEIVABLES DOCUMENTS means one or more receivables purchase
agreements entered into by one or more Consolidated Companies and each other
instrument, agreement, and document entered into by such Consolidated Companies
evidencing Accounts Receivable Financings.
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RECEIVABLES PROGRAM ASSETS means (a) all Receivables in which
undivided percentage interests are transferred by any Consolidated Company
pursuant to the Receivables Documents, (b) all Receivables Related Assets with
respect to the Receivables described in CLAUSE (A) of this definition, and (c)
all collections (including recoveries) and other proceeds of the assets
described in the foregoing clauses.
RECEIVABLES RELATED ASSETS means (a) any Rights arising under the
documentation governing or relating to Receivables (including Rights in respect
of Liens securing such Receivables and other credit support in respect of such
Receivables), (b) any proceeds of such Receivables and any lockboxes or
accounts in which such proceeds are deposited, and (c) spread accounts and
other similar accounts (and any amounts on deposit therein) established in
connection with an Accounts Receivable Financing.
RECEIVABLES SUBSIDIARY means a special purpose Wholly-owned Subsidiary
created in connection with the transactions contemplated by an Accounts
Receivable Financing, which Subsidiary engages in no activities or owns no
other assets, other than those incidental to such Accounts Receivable
Financing.
REGISTER is defined in SECTION 11.14(c).
REGULATION D means Regulation D of the Board of Governors of the
Federal Reserve System, as amended.
REGULATION U means Regulation U of the Board of Governors of the
Federal Reserve System, as amended.
RELEASE means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposal,
deposit, dispersal, migrating, or other movement into the air, ground, or
surface water, or soil.
REPORTABLE EVENT shall have the meaning specified in Section 4043 of
ERISA or the regulations issued thereunder in connection with an Employee Plan,
excluding events for which the notice requirement is waived under applicable
PBGC regulations other than those events described in Sections 2615.11, 2615.15
and 2615.19 of such regulations, including each such provision as it may
subsequently be renumbered.
REPRESENTATIVES means representatives, officers, directors, employees,
attorneys, and agents.
RESERVE REQUIREMENT means, at any time, the maximum rate at which
reserves (including, without limitation, any marginal, special, supplemental,
or emergency reserves) are required to be maintained under regulations issued
from time to time by the Board of Governors of the Federal Reserve System (or
any successor) by member banks of the Federal Reserve System against, in the
case of Eurodollar Rate Borrowings, "Eurocurrency liabilities" (as such term is
used in Regulation D). Without limiting the effect of the foregoing, the
Reserve Requirement shall reflect any other reserves required to be maintained
by such member banks with respect to (a) any category of liabilities which
includes deposits by reference to which the Adjusted Eurodollar Rate is to be
determined, or (b) any category of extensions of credit or other assets which
include Eurodollar Rate Borrowings. The Adjusted Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any change in the
Reserve Requirement.
RESPONSIBLE OFFICER means the chairman, president, chief executive
officer, chief financial officer, senior vice president, or treasurer of
Borrower, or, for all purposes under the Loan Papers other than
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SECTION 8.8, any other officer designated from time to time by the Board of
Directors of Borrower, which designated officer is acceptable to Administrative
Agent.
RESTRICTED COMPANIES, at any time of determination thereof, shall mean
Borrower and each of its Subsidiaries (other than the Unrestricted
Subsidiaries) of which more than 50% (by number of votes) of the Voting Stock
is beneficially owned, directly or indirectly, by Borrower or any Restricted
Subsidiary.
RESTRICTED SUBSIDIARIES means the Restricted Companies, other than
Borrower.
REVOLVING/TERM NOTE means a promissory note in substantially the form
of EXHIBIT A-1, and all renewals and extensions of all or any part thereof.
RIGHTS means rights, remedies, powers, privileges, and benefits.
RIGHTS OF WAY means the easements, rights of way, and other rights
entitling the Restricted Companies to own, use, operate and maintain the
network facilities.
SALE-LEASEBACK FINANCINGS means those certain transactions pursuant to
the Sale-Leaseback Participation Agreements pursuant to which Williams
Telecommunications Company (predecessor in interest to WorldCom Network
Services, Inc.) sold (a) its fiber optics telecommunications system from
Fairfax, Kansas to Salt Lake City, Utah, (b) its fiber optics
telecommunications system from Salt Lake City, Utah to Los Angeles, California,
and (c) its digital microwave telecommunications system from Evanston, Wyoming
to Portland, Oregon, and the owner participants leased such systems back to
Williams Telecommunications Company (predecessor in interest to WorldCom
Network Services, Inc.).
SALE-LEASEBACK PARTICIPATION AGREEMENTS means (a) the First
Supplemental Participation Agreement, dated as of April 15, 1987, among
Williams Telecommunications Company (predecessor in interest to WorldCom
Network Services, Inc.), as lessee, The CIT Group/Factoring Manufacturers
Hanover, Inc. ("CIT"), as owner participant, Wilmington Trust Company and
William J. Wade, as owner trustee, the purchasers listed in Schedule I thereto,
as purchasers, and The Connecticut Trust Company, National Association
("CBT"), as indenture trustee, (b) the Participation Agreement, dated as of
April 15, 1987, among Williams Telecommunications Company (predecessor in
interest to WorldCom Network Services, Inc.), as lessee, Ford Motor Credit
Company, as owner participant, Wilmington Trust Company and William J. Wade as
owner trustee, the financial institutions listed in Schedule I thereto as loan
participants, and CBT, as indenture trustee, and (c) the Participation
Agreement, dated as of April 16, 1987, among Williams Telecommunications
Company (predecessor in interest to WorldCom Network Services, Inc.), as
lessee, Ford Motor Credit Company, as owner participant, Wilmington Trust
Company and William J. Wade, as owner trustee, the financial institutions
listed in Schedule I thereto, as loan participants, and CBT, as indenture
trustee.
S&P means Standard & Poor's Rating Group, a division of McGraw Hill,
Inc., a New York corporation.
SCHEDULE means, unless specified otherwise, a schedule attached to
this Agreement, as the same may be supplemented and modified from time to time
in accordance with the terms of the Loan Papers.
SOLVENT means, as to a Person, that (a) the aggregate fair market
value of such Person's assets exceeds its liabilities (whether contingent,
subordinated, unmatured, unliquidated, or otherwise), (b) such
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Person has sufficient cash flow to enable it to pay its Debts as they mature,
and (c) such Person does not have unreasonably small capital to conduct such
Person's businesses.
SUBSIDIARY of any Person means any entity of which an aggregate of
more than 50% (in number of votes) of the stock (or equivalent interests) is
owned of record or beneficially, directly or indirectly, by such Person.
TAXES means, for any Person, taxes, assessments, or other governmental
charges or levies imposed upon such Person, its income, or any of its
properties, franchises, or assets.
TERM CONVERSION DATE means the date upon which the Principal Debt is
converted to a term loan in accordance with SECTION 2.3.
TERM CONVERSION REQUEST is defined in SECTION 2.3(a).
TERM LOANS means loans made by the Lenders pursuant to SECTION 2.3.
TERM LOAN MATURITY DATE is defined in SECTION 2.3.
TERMINATION DATE means the earliest of (a) February 18, 1999 and (b)
the effective date of any other termination or cancellation of Lenders'
commitments to lend under, and in accordance with, this Agreement.
TOTAL DEBT means (without duplication), all Debt of the Restricted
Companies.
TYPE means any type of Borrowing determined with respect to the
interest option applicable thereto.
UNRESTRICTED SUBSIDIARIES, at any time of determination thereof, shall
mean (a) the Receivables Subsidiary, (b) any Subsidiary of Borrower designated
as an "Unrestricted Subsidiary" from time to time in accordance with SECTION
7.27, and (c) each of Brooks and its Subsidiaries, until the date upon which
such Companies are designated as Restricted Subsidiaries pursuant to SECTION
7.27. UNRESTRICTED SUBSIDIARY, at any time of determination, shall mean any of
the Unrestricted Subsidiaries.
VOTING STOCK shall mean securities (as such term is defined in Section
2(1) of the Securities Act of 1933, as amended) of any class or classes, the
holders of which are ordinarily, in the absence of contingencies, entitled to
elect a majority of the corporate directors (or Persons performing similar
functions).
WHOLLY-OWNED when used in connection with any Subsidiary shall mean a
Subsidiary of which all of the issued and outstanding shares of stock (except
shares required as directors' qualifying shares) shall be owned by Borrower or
one or more of its Wholly-owned Subsidiaries.
WTG means Williams Telecommunications Group, Inc., a Delaware
corporation that merged with and into Borrower effective as of February 22,
1995.
1.2 Number and Gender of Words; Other References. Unless
otherwise specified, in the Loan Papers (a) where appropriate, the singular
includes the plural and vice versa, and words of any gender include each other
gender, (b) heading and caption references may not be construed in interpreting
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provisions, (c) monetary references are to currency of the United States of
America, (d) section, paragraph, annex, schedule, exhibit, and similar
references are to the particular Loan Paper in which they are used, (e)
references to "telecopy," "facsimile," "fax," or similar terms are to facsimile
or telecopy transmissions, (f) references to "including" mean including without
limiting the generality of any description preceding that word, (g) the rule of
construction that references to general items that follow references to
specific items are limited to the same type or character of those specific
items is not applicable in the Loan Papers, (h) references to any Person
include that Person's heirs, personal representatives, successors, trustees,
receivers, and permitted assigns, (i) references to any Law include every
amendment or supplement to it, rule and regulation adopted under it, and
successor or replacement for it, and (j) references to any Loan Paper or other
document include every renewal and extension of it, amendment and supplement to
it, and replacement or substitution for it.
1.3 Accounting Principles. All accounting and financial terms
used in the Loan Papers and the compliance with each financial covenant therein
shall be determined in accordance with GAAP, and, all accounting principles
shall be applied on a consistent basis so that the accounting principles in a
current period are comparable in all material respects to those applied during
the preceding comparable period.
SECTION 2 BORROWING PROVISIONS.
2.1 Commitments. Subject to and in reliance upon the terms,
conditions, representations, and warranties in the Loan Papers, each Lender
severally and not jointly agrees to lend to Borrower such Lender's Pro Rata
Part of one or more Borrowings not to exceed such Lender's Committed Sum,
which, subject to the Loan Papers, Borrower may borrow, repay, and reborrow
under this Agreement; provided that (a) each such Borrowing must occur on a
Business Day and no later than the Business Day immediately preceding the
Termination Date; (b) each such Borrowing shall be in an amount not less than
(i) $5,000,000 or a greater integral multiple of $1,000,000 (if a Base Rate
Borrowing), (ii) $20,000,000 or a greater integral multiple of $1,000,000 (if a
Eurodollar Rate Borrowing), or (iii) $20,000,000 or a greater integral multiple
of $1,000,000 (if a Competitive Borrowing) and (c) on any date of
determination, the Principal Debt shall never exceed the Commitment.
2.2 Competitive Bid Subfacility.
(a) In addition to Borrowings otherwise provided for
herein, but subject to the terms and conditions of the Loan Papers,
Borrower may, as set forth in this SECTION 2.2, request Lenders to
make offers to make Competitive Borrowings under the Facility.
Lenders may, but shall have no obligation to, make any such offers,
and Borrower may, but shall have no obligation to, accept any such
offers. Any Competitive Borrowings made available to Borrower
hereunder shall be subject, however, to the conditions that on any
date of determination: (i) the aggregate principal outstanding under
all Competitive Borrowings hereunder made by all Lenders shall not
exceed the Competitive Bid Availability then in effect; (ii) on any
date of determination, the Principal Debt shall not exceed the
Commitment; and (iii) each Borrowing under the Competitive Bid
Subfacility must occur on a Business Day and prior to the Business Day
immediately preceding the Termination Date.
(b) In order to request Competitive Bids, Borrower shall
deliver a Competitive Bid Request to Administrative Agent no later
than 10:00 a.m. Dallas, Texas time (i) on the fifth Business Day
preceding the Borrowing Date for any requested Competitive Borrowing
that will be comprised of Eurodollar Rate Borrowings, or (ii) not
later than 10:00 a.m. Dallas, Texas time one Business Day before the
Borrowing Date for any requested Competitive Borrowing that will
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be comprised of Fixed Rate Borrowings. A Competitive Bid Request that
does not conform substantially to the format of EXHIBIT B-3 may be
rejected by Administrative Agent, and Administrative Agent shall
promptly notify Borrower of such rejection. Each Competitive Bid
Request shall specify (i) whether the Competitive Borrowing then being
requested will be comprised of Eurodollar Rate Borrowings or Fixed
Rate Borrowings, (ii) the Borrowing Date of such Competitive Borrowing
(which shall be a Business Day) and the aggregate principal amount
thereof (which shall not be less than $20,000,000 or a greater
integral multiple of $1,000,000), and (iii) the Interest Period with
respect thereto (which may not be more than six months and which may
not extend beyond the Termination Date). Promptly after its receipt
of a Competitive Bid Request that is not rejected as aforesaid,
Administrative Agent shall notify Lenders of the Competitive Bid
Request on a form substantially similar to EXHIBIT B-4 hereto,
pursuant to which the Lenders are invited to bid, subject to the terms
and conditions of this Agreement, to make Competitive Borrowings
pursuant to such Competitive Bid Request. Notwithstanding the
foregoing, Administrative Agent shall have no obligation to invite any
Lender to make a Competitive Bid pursuant to this SECTION 2.2 until
such Lender has delivered a completed Administrative Questionnaire to
Administrative Agent.
(c) Each Lender may make one or more Competitive Bids to
Borrower responsive to each respective Competitive Bid Request. Each
Competitive Bid by a Lender must be received by Administrative Agent
substantially in the form of EXHIBIT B-5, (i) no later than 11:00 a.m.
Dallas, Texas time on the fourth Business Day preceding the Borrowing
Date for any requested Competitive Borrowing that will be comprised of
Eurodollar Rate Borrowings, or (ii) prior to 10:00 a.m. Dallas, Texas
time on the Borrowing Date for any requested Competitive Borrowing
that will be comprised of Fixed Rate Borrowings. Competitive Bids
that do not conform substantially to the format of EXHIBIT B-5 may be
rejected by Administrative Agent after conferring with, and upon the
instruction of, Borrower, and Administrative Agent shall notify the
appropriate Lender of such rejection as soon as practicable. Each
Competitive Bid shall refer to this Agreement and shall (x) specify
the principal amount (which shall be in a minimum principal amount of
$5,000,000 or a greater integral multiple of $1,000,000 and which may
equal the entire principal amount of the Competitive Borrowing
requested by Borrower and may exceed such Lender's Committed Sum,
subject to the limitations set forth in SECTION 2.2(a) hereof) of the
Competitive Borrowing such Lender is willing to make to Borrower, (y)
specify the Competitive Bid Rate at which such Lender is prepared to
make its Competitive Borrowing, and (z) confirm the Interest Period
with respect thereto specified by Borrower in its Competitive Bid
Request. A Competitive Bid submitted by a Lender pursuant to this
SECTION 2.2(c) shall be irrevocable.
(d) Administrative Agent shall promptly notify Borrower
of all Competitive Bids made and the Competitive Bid Rate and the
principal amount of each Competitive Borrowing in respect of which a
Competitive Bid was made and the identity of the Lender that made each
bid.
(e) Borrower may, subject only to the provisions of this
SECTION 2.2(e), accept or reject any or all of the Competitive Bids
referred to in SECTION 2.2(c); provided, however, that the aggregate
amount of the Competitive Bids so accepted by Borrower may not exceed
the principal amount of the Competitive Borrowing requested by
Borrower (subject to the further limitations of SECTION 2.2(a)
hereof). Borrower shall notify Administrative Agent whether and to
what extent it has decided to accept or reject any or all of the bids
referred to in SECTION 2.2(c), (i) not later than 10:00 a.m. Dallas,
Texas time three Business Days before the Borrowing Date specified for
a proposed Competitive Borrowing that is deemed a Eurodollar Rate
Borrowing or (ii) not later than 11:00 a.m., Dallas, Texas time on the
day specified for a proposed Competitive Borrowing
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that is deemed a Fixed Rate Borrowing; provided, however, that (w) the
failure by Borrower to give such notice shall be deemed to be a
rejection of all the bids referred to in SECTION 2.2(c), (x) Borrower
shall not accept a bid in the same or lower principal amount made at a
particular Competitive Bid Rate if Borrower has decided to reject a
bid made at a lower Competitive Bid Rate, (y) if Borrower shall accept
bids made at a particular Competitive Bid Rate but shall be restricted
by other conditions hereof from borrowing the principal amount of the
Competitive Borrowing in respect of which bids at such Competitive Bid
Rate have been made, then Borrower shall accept a ratable portion of
each bid made at such Competitive Bid Rate based as nearly as possible
on the respective principal amounts of the Competitive Borrowing for
which such bids were made, and (z) no bid shall be accepted for a
Competitive Borrowing unless the aggregate principal amount to be
funded pursuant to all accepted bids shall be in a minimum amount of
$5,000,000 or a greater integral multiple of $1,000,000 for each
respective Lender whose bid is accepted. Notwithstanding the
foregoing, if it is necessary for Borrower to accept a ratable
allocation of the bids made in response to a Competitive Bid Request
(whether pursuant to the events specified in CLAUSE (Y) above or
otherwise) and the available principal amount of the Competitive
Borrowing to be allocated among Lenders submitting Competitive Bids is
not sufficient to enable Competitive Borrowings to be allocated to
each such Lender in a minimum principal amount of $5,000,000 or a
greater integral multiple of $1,000,000, then Borrower shall select
the Lenders to be allocated such Competitive Borrowings and shall
round allocations up or down to the next higher or lower multiple of
$500,000 as it shall deem appropriate. A notice given by Borrower
pursuant to this SECTION 2.2(e) shall be irrevocable.
(f) Administrative Agent shall promptly notify each
bidding Lender whether or not its Competitive Bid has been accepted
(which notice to those Lenders whose Competitive Bids have been
accepted will be given within one hour from the time such bid was
accepted by Borrower and shall further indicate in what amount and at
what Competitive Bid Rate), and each successful bidder will thereupon
become bound, subject to the other applicable conditions hereof, to
advance the Competitive Borrowing in respect of which its bid has been
accepted. After completing the notifications referred to in the
immediately preceding sentence, Administrative Agent shall notify each
bidding Lender of the aggregate principal amount of all Competitive
Bids accepted for and the range of Competitive Bid Rates submitted in
connection with that Competitive Borrowing.
(g) If Administrative Agent shall at any time elect to
submit a Competitive Bid in its capacity as a Lender, it shall submit
such bid directly to Borrower one-half hour earlier than the latest
time at which the other Lenders are required to submit their bids to
Administrative Agent pursuant to SECTION 2.2(c).
(h) Each Competitive Borrowing shall be due and payable
on the last day of the applicable Interest Period; provided that if
Borrower fails to repay any Competitive Borrowing on such day,
Borrower shall be deemed to have given a Notice of Borrowing
requesting the Lenders to make a Borrowing in the amount of such
Competitive Borrowing, subject to satisfaction of the conditions
specified in SECTIONS 2.1 and 5.3; provided that failure to repay such
Competitive Borrowing on the last day of the applicable Interest
Period shall not constitute a failure to satisfy such conditions.
2.3 Conversion of Facility to Term Loans. Borrower shall have the
option to convert the Principal Debt outstanding on the Termination Date to a
Term Loan maturing no later than the earlier of (a) July 1, 2004, and (b) one
Business Day after the later of the "Facility A Termination Date" (as such
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term is defined in the Facility A Agreement), the "Term Loan Maturity Date" (as
such term is defined in the Facility B Agreement), and the "Facility B
Termination Date" (as such term is defined in the Facility B Agreement) (the
"TERM LOAN MATURITY DATE"), subject to and on the terms and conditions set
forth below:
(a) No sooner than 30 days (and not later than 10 days)
preceding the Termination Date, Borrower shall deliver to
Administrative Agent a Term Conversion Request in substantially the
form of EXHIBIT B-6, which, among other things, shall (i) specify
Borrower's election to make such conversion to a Term Loan, and (ii)
specify the Type of Borrowing or Borrowings to which the Principal
Debt shall be converted and the Interest Periods therefor (if
applicable) on the Term Conversion Date; and
(b) No Default or Potential Default shall exist on either
the date such Term Conversion Request is delivered or on the Term
Conversion Date; and no Default or Potential Default shall exist after
giving effect to the Term Loan Conversion.
2.4 Termination of Commitments. Without premium or penalty, and
upon giving not less than ten (10) Business Days prior written and irrevocable
notice to Administrative Agent, Borrower may terminate in whole or in part the
unused portion of the Commitment; provided that: (a) each partial termination
shall be in an amount of not less than $5,000,000 or a greater integral
multiple of $1,000,000; (b) the amount of the Commitment may not be reduced
below the Principal Debt then outstanding; and (c) each reduction shall be
allocated Pro Rata among the Lenders in accordance with their respective Pro
Rata Parts. Promptly after receipt of such notice of termination or reduction,
Administrative Agent shall notify each Lender of the proposed cancellation or
reduction. Such termination or partial reduction of the Commitment shall be
effective on the Business Day specified in Borrower's notice (which date must
be at least ten Business Days after Borrower's delivery of such notice). In
the event that the Commitment is reduced to zero at a time when there shall be
no outstanding Principal Debt, this Agreement shall be terminated to the extent
specified in SECTION 11.15, and all commitment fees and other fees then earned
and unpaid hereunder and all other amounts of the Obligation then due and owing
shall be immediately due and payable, without notice or demand by
Administrative Agent or any Lender.
2.5 Borrowing Procedure. The following procedures apply to
Borrowings (other than Competitive Borrowings):
(a) Each Borrowing shall be made on Borrower's notice (a
"NOTICE OF BORROWING," substantially in the form of EXHIBIT B-1) to
Administrative Agent requesting that Lenders fund a Borrowing on a
certain date (the "BORROWING DATE"), which notice (i) shall be
irrevocable and binding on Borrower, (ii) shall specify the Borrowing
Date, amount, Type, and (for a Borrowing comprised of Eurodollar Rate
Borrowings) Interest Period, and (iii) must be received by
Administrative Agent no later than 10:00 a.m. Dallas, Texas time on
the third Business Day preceding the Borrowing Date for any Eurodollar
Rate Borrowing or on the Business Day immediately preceding the
Borrowing Date for any Base Rate Borrowing. Administrative Agent
shall timely notify each Lender with respect to each Notice of
Borrowing.
(b) Each Lender shall remit its Pro Rata Part of each
requested Borrowing to Administrative Agent's principal office in
Dallas, in funds which are or will be available for immediate use by
Administrative Agent by 1:00 p.m. Dallas time on the Borrowing Date
therefor. Subject to receipt of such funds, Administrative Agent
shall (unless to its actual knowledge any of the conditions precedent
therefor have not been satisfied by Borrower or waived by
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Determining Lenders) make such funds available to Borrower by causing
such funds to be deposited to Borrower's account as designated to
Administrative Agent by Borrower. Notwithstanding the foregoing,
unless Administrative Agent shall have been notified by a Lender prior
to a Borrowing Date that such Lender does not intend to make available
to Administrative Agent such Lender's Pro Rata Part of the applicable
Borrowing, Administrative Agent may assume that such Lender has made
such proceeds available to Administrative Agent on such date, as
required herein, and Administrative Agent may (unless to its actual
knowledge any of the conditions precedent therefor have not been
satisfied by Borrower or waived by Determining Lenders), in reliance
upon such assumption (but shall not be required to), make available to
Borrower a corresponding amount in accordance with the foregoing
terms, but, if such corresponding amount is not in fact made available
to Administrative Agent by such Lender on such Borrowing Date,
Administrative Agent shall be entitled to recover such corresponding
amount on demand (i) from such Lender, together with interest at the
Federal Funds Rate during the period commencing on the date such
corresponding amount was made available to Borrower and ending on (but
excluding) the date Administrative Agent recovers such corresponding
amount from such Lender, or (ii) if such Lender fails to pay such
corresponding amount forthwith upon such demand, then from Borrower,
together with interest at a rate per annum equal to the applicable
rate for such Borrowing during the period commencing on such Borrowing
Date and ending on (but excluding) the date Administrative Agent
recovers such corresponding amount from Borrower. No Lender shall be
responsible for the failure of any other Lender to make its Pro Rata
Part of any Borrowing.
SECTION 3 TERMS OF PAYMENT.
3.1 Loan Accounts, Notes, and Payments.
(a) The Principal Debt owed to each Lender shall be
evidenced by one or more loan accounts or records maintained by such
Lender in the ordinary course of business. The loan accounts or
records maintained by the Administrative Agent (including, without
limitation, the Register) and each Lender shall be conclusive evidence
absent manifest error of the amount of the Borrowings made by Borrower
from each Lender (and the Competitive Bid Subfacility thereunder) and
the interest and principal payments thereon. Any failure to so record
or any error in doing so shall not, however, limit or otherwise affect
the obligation of Borrower under the Loan Papers to pay any amount
owing with respect to the Obligation.
(b) Upon the request of any Lender made through the
Administrative Agent, the Principal Debt owed to such Lender may be
evidenced by one or more of the following Notes (as the case may be):
(i) a Revolving/Term Note (with respect to Principal Debt other than
Principal Debt arising and outstanding under the Competitive Bid
Subfacility); and (ii) a Competitive Bid Note (with respect to
Principal Debt arising and outstanding under the Competitive Bid
Subfacility).
(c) Each payment or prepayment on the Obligation is due
and must be paid at Administrative Agent's principal office in Dallas
in funds which are or will be available for immediate use by
Administrative Agent by 12:00 noon Dallas, Texas time on the day due.
Payments made after 12:00 noon, Dallas, Texas, time shall be deemed
made on the Business Day next following. Administrative Agent shall
pay to each Lender any payment or prepayment to which such Lender is
entitled hereunder on the same day Administrative Agent shall have
received the same from Borrower; provided such payment or prepayment
is received by Administrative
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Agent prior to 12:00 noon Dallas, Texas time, and otherwise before
12:00 noon Dallas time on the Business Day next following. If and to
the extent Administrative Agent shall not make such payments to
Lenders when due as set forth in the preceding sentence, such unpaid
amounts shall accrue interest, payable by Administrative Agent, at the
Federal Funds Rate from the due date until (but not including) the
date on which Administrative Agent makes such payments to Lenders.
3.2 Interest and Principal Payments.
(a) Interest on each Eurodollar Rate Borrowing or on each
Fixed Rate Borrowing shall be due and payable as it accrues on the
last day of its respective Interest Period and on the Termination Date
and Term Loan Maturity Date, as applicable; provided that if any
Interest Period is a period greater than three (3) months, then
accrued interest shall also be due and payable on the date three (3)
months after the commencement of such Interest Period. Interest on
each Base Rate Borrowing shall be due and payable as it accrues on
each March 31, June 30, September 30, and December 31, and on the
Termination Date and Term Loan Maturity Date, as applicable.
(b) Unless the Principal Debt is converted to a Term Loan
on or prior to the Termination Date, Borrower shall pay on such
Termination Date all outstanding Principal Debt, together with all
accrued and unpaid interest and fees.
(c) In the event the Principal Debt is converted to a
Term Loan, the Principal Debt outstanding under the Term Loan shall be
due and payable in a single installment on the Term Loan Maturity
Date.
(d) On any date of determination, if the Principal Debt
exceeds the Commitment then in effect, then Borrower shall make a
mandatory prepayment of the Principal Debt in at least the amount of
such excess, together with (i) all accrued and unpaid interest on the
principal amount so prepaid and (ii) any Consequential Loss arising as
a result thereof.
(e) After giving Administrative Agent advance written
notice of the intent to prepay, Borrower may voluntarily prepay all or
any part of the Principal Debt from time to time and at any time, in
whole or in part, without premium or penalty; provided that: (i) such
notice must be received by Administrative Agent by 12:00 noon Dallas,
Texas time on (A) the third Business Day preceding the date of
prepayment of a Eurodollar Rate Borrowing, and (B) one Business Day
preceding the date of prepayment of a Base Rate Borrowing; (ii) each
such partial prepayment must be in a minimum amount of at least
$5,000,000 or a greater integral multiple of $1,000,000 thereof (if a
Eurodollar Rate Borrowing or a Base Rate Borrowing); (iii) all accrued
interest on the Obligation must also be paid in full, to the date of
such prepayment; and (iv) Borrower shall pay any related Consequential
Loss within ten (10) days after demand therefor. Each notice of
prepayment shall specify the prepayment date, whether the Facility or
the Competitive Bid Subfacility is being prepaid, the Type of
Borrowing(s) and amount(s) of such Borrowing(s) to be prepaid and
shall constitute a binding obligation of Borrower to make a prepayment
on the date stated therein. Notwithstanding the foregoing, Borrower
shall not voluntarily prepay any Competitive Borrowing prior to the
last day of the Interest Period therefor.
(f) This SECTION 3.2(F) shall apply in the event of an
asset disposition by any Restricted Company, as a result of which
Borrower is required to prepay, or to offer to prepay, all or any part
of the Debt under any Note Agreement. In the event that any
Restricted Company shall consummate such an asset disposition,
Borrower shall provide Administrative Agent and each
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Lender with written notice of such asset disposition and the amount of
the aggregate net proceeds thereof. Borrower shall, within ten (10)
Business Days after the consummation of such disposition, prepay the
Obligation in an amount equal to the aggregate net proceeds received
by Borrower or any Restricted Company from such asset disposition
multiplied by a fraction, the numerator of which fraction shall be the
outstanding principal amount of the Principal Debt on the date of such
disposition, and the denominator of which fraction shall be the
outstanding consolidated aggregate pari passu Debt on such date.
Prepayments on the Obligation under this SECTION 3.2(f) shall be
applied in such order and manner as set forth in SECTION 3.11(b).
(g) In the event that Facility A and Facility B are
refinanced or repaid in full, including, without limitation, any
repayment or refinancing in connection with the closing of the merger
between Borrower, TC Investments Corp., a wholly-owned Subsidiary of
Borrower, and MCI Communications Corp., then on the date of such
repayment or refinancing of Facility A and Facility B, Borrower shall
repay the outstanding Obligation in full and the Commitment shall be
permanently terminated.
3.3 Interest Options. Except where specifically otherwise
provided, Borrowings shall bear interest at a rate per annum equal to the
lesser of (a) as to the respective Type of Borrowing (as designated by Borrower
in accordance with this Agreement), the Base Rate plus the Applicable Margin
for Base Rate Borrowings, the Adjusted Eurodollar Rate plus the Applicable
Margin for Eurodollar Rate Borrowings, or any Competitive Bid Rate, as the case
may be, and (b) the Maximum Rate. Each change in the Base Rate and the Maximum
Rate, subject to the terms of this Agreement, will become effective, without
notice to Borrower or any other Person, upon the effective date of such change.
3.4 Quotation of Rates. It is hereby acknowledged that a
Responsible Officer or other appropriately designated officer of Borrower may
call Administrative Agent on or before the date on which a Notice of Borrowing
is to be delivered by Borrower in order to receive an indication of the rates
then in effect, but such indicated rates shall neither be binding upon
Administrative Agent or Lenders nor affect the rate of interest which
thereafter is actually in effect when the Notice of Borrowing is given.
3.5 Default Rate. At the option of Determining Lenders and to the
extent permitted by Law, all past-due Principal Debt and accrued interest
thereon shall bear interest from maturity (stated or by acceleration) at the
Default Rate until paid, regardless whether such payment is made before or
after entry of a judgment.
3.6 Interest Recapture. If the designated rate applicable to any
Borrowing exceeds the Maximum Rate, the rate of interest on such Borrowing
shall be limited to the Maximum Rate, but any subsequent reductions in such
designated rate shall not reduce the rate of interest thereon below the Maximum
Rate until the total amount of interest accrued thereon equals the amount of
interest which would have accrued thereon if such designated rate had at all
times been in effect. In the event that at maturity (stated or by
acceleration), or at final payment of the Principal Debt, the total amount of
interest paid or accrued is less than the amount of interest which would have
accrued if such designated rates had at all times been in effect, then, at such
time and to the extent permitted by Law, Borrower shall pay an amount equal to
the difference between (a) the lesser of the amount of interest which would
have accrued if such designated rates had at all times been in effect and the
amount of interest which would have accrued if the Maximum Rate had at all
times been in effect, and (b) the amount of interest actually paid or accrued
on the Principal Debt.
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3.7 Interest Calculations.
(a) All payments of interest shall be calculated on the
basis of actual number of days (including the first day but excluding
the last day) elapsed but computed as if each calendar year consisted
of 360 days in the case of a Eurodollar Rate Borrowing, a Fixed Rate
Borrowing, Base Rate Borrowings calculated with reference to the
Federal Funds Rate (unless such calculation would result in the
interest on the Borrowings exceeding the Maximum Rate in which event
such interest shall be calculated on the basis of a year of 365 or 366
days, as the case may be) and 365 or 366 days, as the case may be, in
the case of a Base Rate Borrowing calculated with reference to Prime
Rate. All interest rate determinations and calculations by
Administrative Agent shall be conclusive and binding absent manifest
error.
(b) The provisions of this Agreement relating to
calculation of the Base Rate, the Adjusted Eurodollar Rate, and
Competitive Bid Rates are included only for the purpose of deter