AMENDMENT NO. 1, (this "Amendment") dated as of
April 22, 2003 to the Credit, Guaranty, Security
and Pledge Agreement dated as of October 31, 2002
(the "Credit Agreement") among GCI HOLDINGS, INC.,
an Alaska corporation (the "Borrower"), the
guarantors referred to therein (the "Guarantors"),
the lenders referred to therein (the "Lenders"),
CREDIT LYONNAIS NEW YORK BRANCH, as administrative
agent for the Lenders, issuing bank, co-bookrunner
and co-arranger (the "Administrative Agent), CIT
LENDING SERVICES CORPORATION, as syndication agent
(the "Syndication Agent"), and GENERAL ELECTRIC
CAPITAL CORPORATION, as documentation agent,
co-arranger and co-bookrunner, (the "Documentation
Agent").
INTRODUCTORY STATEMENT
All capitalized terms not otherwise defined in this Amendment
are used herein as defined in the Credit Agreement.
The Borrower has requested that the Credit Agreement be
amended to modify certain provisions thereof as hereinafter set forth.
SECTION 1. Amendment to the Credit Agreement. Subject to the
provisions of Section 2 hereof, the Credit Agreement is hereby amended,
effective on the Amendment No. 1 Effective Date (such term being used herein as
defined in Section 2 hereof), as follows:
(a) Article 1 of the Credit Agreement is hereby amended as follows:
(i) The definition of "Excess Cash Flow" is deleted in its entirety and
replaced with the following:
"'Excess Cash Flow' shall mean, for any period for which it is
to be determined, the amount by which the sum of (x) EBITDA for such
period plus (y) one-time fiber sales for such period (including IRUs
and long term leases which do not provide for periodic payments to be
made at least semi-annually during the term of such transaction in
proportion to the availability of capacity) to the extent such fiber
sales are not included in EBITDA, exceeds Fixed Charges during such
period.";
(ii) The definition of "Final Maturity Date" is deleted in its entirety
and replaced with the following: "`Final Maturity Date' shall mean
October 31, 2007.";
(iii) Clause (j) of the definition of "Permitted Encumbrances" is
hereby deleted in its entirety and replaced with the following: "(j)
Security deposits paid under contracts
relating to the construction or acquisition of up to $58 million of
submarine fiber capacity between Alaska and the lower forty-eight
states, which security deposits shall not cumulatively exceed
$8,000,000 in the aggregate during the term of this Credit Agreement.";
(iv) The definition of "Permitted New Fiber Cap Ex" is hereby amended
by inserting a period after the phrase "between Alaska and the lower
forty-eight states" and deleting all text appearing after such phrase;
and
(v) The following new definitions are added to Article 1 of the Credit
Agreement in the correct alphabetical order:
(1) "Amendment No. 1 Effective Date" shall have the meaning
given to such term in Amendment No. 1 to Credit Agreement.
(2) "Amendment No. 1 to Credit Agreement" shall mean that
certain Amendment No. 1, dated as of April 22, 2003 to the Credit
Agreement among the Borrower, the Guarantors, the Lenders and the
Agents.
(3) "Excess Capital Expenditures" shall mean the aggregate
amount of Capital Expenditures (other than Permitted New Fiber Cap Ex)
made during a given fiscal year in excess of $25,000,000;
(4) "Successful Senior Note Transaction" shall mean that prior
to February 1, 2007, GCII shall have repaid in full or successfully
refinanced the Senior Notes from the proceeds of Indebtedness issued by
GCI or GCII, which refinancing Indebtedness shall either (i) (w) mature
no earlier than three (3) years after the Final Maturity Date, (x) be
unsecured and no more senior in right of payment than the Senior Notes
as in effect on the Amendment No. 1 Effective Date, (y) not contain
covenants more restrictive than the terms of the Senior Notes as in
effect on the Amendment No. 1 Effective Date and (z) be otherwise
satisfactory to the Administrative Agent in its sole discretion or (ii)
be on terms and conditions otherwise satisfactory to the Required
Lenders in their sole discretion.
(b) Section 2.4(b) of the Credit Agreement is hereby amended by
deleting the final sentence thereof and replacing it with the following:
"The Borrower will repay a portion of the Term Loan on each of
the following dates set forth below, in an amount equal to the
amount set forth next to such date:
Date Amount of Repayment
---- -------------------
September 30, 2003 $5,000,000
December 31, 2003 $5,000,000
March 31, 2004 $5,000,000
June 30, 2004 $5,000,000
September 30, 2004 $5,000,000
December 31, 2004 $5,000,000
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March 31, 2005 $6,000,000
June 30, 2005 $6,000,000
September 30, 2005 $6,000,000
December 31, 2005 $6,000,000
March 31, 2006 $8,000,000
June 30, 2006 $8,000,000
September 30, 2006 $8,000,000
December 31, 2006 $8,000,000
March 31, 2007 $10,000,000
June 30, 2007 $10,000,000
September 30, 2007 $10,000,000
The remaining principal amount of the Term Loan as evidenced
by the Term Notes shall be payable in full on the Final
Maturity Date."
(c) Section 2.7 of the Credit Agreement is hereby amended by adding the
following new clause (e) at the end thereof: "(e) The Commitments of the Lenders
shall automatically terminate at 5:00 p.m., New York City time, on February 1,
2007, unless the Administrative Agent shall have received satisfactory evidence
that a Successful Senior Note Transaction has been effected."
(d) Section 2.10(c) of the Credit Agreement is hereby deleted in its
entirety and replaced with the following: "(c) The Borrower shall prepay on
February 1, 2007 all Loans outstanding on such date, unless the Administrative
Agent shall have received satisfactory evidence that a Successful Senior Note
Transaction has been effected."
(e) Clause (c) of Section 5.6 is hereby amended by deleting the
parenthetical phrase "(other than the making or incurrence of any obligation to
make any Permitted New Fiber Cap Ex)".
(f) Clause (e) of Section 6.1 of the Credit Agreement, and the
references to such clause and the indebtedness incurred under such clause
appearing in the definitions of "Disqualified Debt", "Senior Secured
Indebtedness" and Section 6.22 of the Credit Agreement, are hereby deleted in
their entirety. Clause (e) of Section 6.1 of the Credit Agreement is hereby
replaced with the following: "(e) Indebtedness for any deferred purchase price
payable under contracts relating to the construction or acquisition of up to $58
million of submarine fiber capacity between Alaska and the lower forty-eight
states; provided that the aggregate principal amount outstanding of such
Indebtedness shall not exceed $15,000,000 during the term of this Credit
Agreement."
(g) Clause (f) of Section 6.9 of the Credit Agreement is hereby deleted
in its entirety and replaced with the following:
"(f) Investments of up to $5,000,000 during each of the 2003, 2004,
2005, 2006 or 2007 fiscal years (as measured on December 31st of each
such year); provided, that during any such fiscal year, the aggregate
amount of such Investments plus any Excess Capital Expenditures shall
not exceed the aggregate amount of Excess Cash Flow generated during
such fiscal year."
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(h) Section 6.11 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following:
"Section 6.11. Total Leverage Ratio. At any time during each period
set forth below, permit the Total Leverage Ratio to be greater than the
corresponding ratio set forth below:
Period Total Leverage Ratio
------ --------------------
Amendment No. 1 Effective Date
through December 30, 2003 4.25:1
December 31, 2003 through December 30, 2004 4.00:1
December 31, 2004 through December 30, 2005 3.75:1
December 31, 2005 through June 29, 2006 3.50:1
June 30, 2006 through June 29, 2007 3.25:1
June 30, 2007 through September 29, 2007 3.00:1
September 30, 2007 through Final Maturity Date 2.75:1
(i) Section 6.12 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following:
"Section 6.12. Senior Secured Leverage Ratio. At any time during the
periods set forth below, permit the Senior Secured Leverage Ratio to be
greater than the corresponding ratio set forth below:
Period Total Leverage Ratio
------ --------------------
Amendment No. 1 Effective Date
through December 30, 2004 2.00:1
December 31, 2004 through September 29, 2006 1.75:1
September 30, 2006 through June 29, 2007 1.50:1
June 30, 2007 through September 29, 2007 1.25:1
September 30, 2007 through Final Maturity Date 1.00:1
(j) Section 6.14 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following:
"SECTION 6.14. Capital Expenditures. (a) The Transaction
Parties and, solely for purposes of determining compliance with this
Section 6.14, GCI Transport and Satco, shall not make or incur any
obligation to make Capital Expenditures (other than Permitted New
Fiber Cap Ex) during any of the 2003, 2004, 2005 or 2006 fiscal years
(as measured on December 31st of each such year) which in the
aggregate exceeds $25,000,000 in such fiscal year plus the amount by
which the aggregate amount of Excess Cash Flow generated during such
fiscal year exceeded the amount of any Investments made pursuant to
Section 6.9(f) above during such fiscal year.
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(b) During any period when the aggregate outstanding principal
amount of Revolving Loans exceeds $25,000,000, the Transaction Parties
may not make or incur any obligation to make Excess Capital
Expenditures; provided that such making or incurrence of an obligation
to make Excess Capital Expenditures shall not constitute an Event of
Default hereunder if, within sixty (60) days thereof, the Borrower
prepays Revolving Loans in an amount sufficient for the aggregate
outstanding principal amount of Revolving Loans to be equal to or
below $25,000,000.
SECTION 2. Conditions to Effectiveness. The effectiveness of
this Amendment is subject to the satisfaction in full of the following
conditions precedent (the first date on which all such conditions have been
satisfied being herein referred to as the "Amendment No. 1 Effective Date"):
(a) The Borrower shall have paid to the Administrative Agent, for the
account of each Lender which has delivered an executed signature page hereto to
the Administrative Agent by no later than April 21, 2003 at 5:00 p.m. (EST), an
amendment fee equal to 1.00% of the amount of such Lender's Revolving Credit
Commitment plus .75% of the outstanding amount of such Lender's Term Loans.
(b) The Administrative Agent shall have received executed counterparts
of this Amendment, which, when taken together, bear the signatures of the
Borrower, the Guarantors, the Agents and the Lenders;
(c) The Administrative Agent shall have received a written opinion or
opinions dated the Amendment No. 1 Effective Date, addressed to the
Administrative Agent and the Lenders and in form and substance satisfactory to
the Administrative Agent and its counsel; and
(d) all legal matters in connection with this Amendment shall be
reasonably satisfactory to Xxxxxx, Xxxxx & Xxxxxxx LLP, counsel for the
Administrative Agent.
SECTION 3. Representations and Warranties. The Borrower hereby
represents and warrants to the Lenders that:
(a) after giving effect to this Amendment, the representations and
warranties contained in Article 3 of the Credit Agreement and in the other
Fundamental Documents are true and correct in all material respects on and as of
the date hereof as if such representations and warranties had been made on and
as of the date hereof (except to the extent such representations and warranties
expressly relate to an earlier date); and
(b) after giving effect to this Amendment, the Borrower is in
compliance with all the terms and provisions set forth in the Credit Agreement
and the other Fundamental Documents and no Default or Event of Default has
occurred or is continuing under the Credit Agreement.
SECTION 4. Full Force and Effect.
(a) Except as expressly set forth herein, this Amendment does not
constitute a waiver or modification of the Credit Agreement or any Fundamental
Document, nor a waiver of any Default or Event of Default, in either case
whether or not known to the Agents.
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(b) Except as expressly amended hereby, the Credit Agreement and each
Fundamental Document shall continue in full force and effect in accordance with
the respective provisions thereof on the date hereof.
(c) As used in the Credit Agreement, the terms "Credit Agreement",
"this Agreement", "herein", "hereafter", "hereto", "hereof", and words of
similar import, shall, unless the context otherwise requires, mean the Credit
Agreement as amended by this Amendment. References to the terms "Agreement" or
"Credit Agreement" appearing in the Exhibits or Schedules to the Credit
Agreement, shall, unless the context otherwise requires, mean the Credit
Agreement as amended by this Amendment.
SECTION 5. Applicable Law. This Amendment shall be governed
by, and construed in accordance with, the laws of the State of New York which
are applicable to contracts made and to be performed wholly within the State of
New York.
SECTION 6. Counterparts. This Amendment may be executed in two
or more counterparts, each of which shall constitute an original, but all of
which when taken together shall constitute but one instrument.
SECTION 7. Expenses. The Borrower agrees to pay all reasonable
out-of-pocket expenses incurred by the Administrative Agent in connection with
the preparation, execution and delivery of this Amendment and any other
documentation contemplated hereby, including, but not limited to, the reasonable
fees and disbursements of counsel retained by Administrative Agent.
SECTION 8. Headings. The headings of this Amendment are for
the purposes of reference only and shall not affect the construction of, or be
taken into consideration in interpreting, this Amendment.
[Signature Pages to Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first written.
BORROWER:
GCI HOLDINGS, INC.
By /s/
Name: Xxxx X. Xxxxxx
Title: Senior Vice President and Chief
Financial Officer
GUARANTORS:
FIBER HOLD CO., INC.
GCI CABLE, INC.
GCI COMMUNICATION CORP.
GCI FIBER CO., INC.
GCI FIBER COMMUNICATION CO., INC.
GCI, INC.
POTTER VIEW DEVELOPMENT CO., INC.
WOK 1, INC.
WOK 2, INC.
By /s/
Name: Xxxx X. Xxxxxx
Title: Secretary/Treasurer
ALASKA UNITED FIBER SYSTEM PARTNERSHIP
By: GCI Fiber Co., Inc., its general partner
By /s/
Name: Xxxx X. Xxxxxx
Title: Secretary/Treasurer
By Fiber Hold Co., Inc., its general partner
By /s/
Name: Xxxx X. Xxxxxx
Title: Secretary/Treasurer
LENDERS:
CREDIT LYONNAIS NEW YORK BRANCH, as
administrative agent for the Lenders, issuing
bank, co-bookrunner and co-arranger (the
"Administrative Agent"), CIT LENDING SERVICES
CORPORATION, as syndication agent (the
"Syndication Agent"), and GENERAL ELECTRIC
CAPITAL CORPORATION, as documentation agent,
co-arranger and co-bookrunner, (the
"Documentation Agent").
By /s/
