1997 REVOLVING CREDIT AGREEMENT
among
DATA TRANSMISSION NETWORK CORPORATION,
FIRST NATIONAL BANK OF OMAHA,
FIRST NATIONAL BANK, WAHOO, NEBRASKA,
NBD BANK,
NORWEST BANK NEBRASKA, N.A.,
THE SUMITOMO BANK, LIMITED,
MERCANTILE BANK OF ST. LOUIS, N.A.,
FIRST BANK, NATIONAL ASSOCIATION,
BANK OF MONTREAL
and
LASALLE NATIONAL BANK
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TABLE OF CONTENTS
I. DEFINITIONS..................................................... 2
II. REVOLVING FACILITY............................................. 9
2.1 Revolving Credit........................................... 9
2.2 Revolving Credit Fees...................................... 11
2.3 Interest on Revolving Credit............................... 11
2.4 Conversion................................................. 12
2.5 Interest on Converted Notes................................ 12
2.6 Payments................................................... 14
2.7 Prepayments................................................ 14
2.8 Security................................................... 14
2.9 Existing Term Notes........................................ 14
2.10 Related Loan Agreement..................................... 15
III. REPRESENTATIONS AND WARRANTIES................................ 15
3.1 Corporate Existence........................................ 15
3.2 Corporate Authority........................................ 15
3.3 Validity of Agreements..................................... 15
3.4 Litigation................................................. 15
3.5 Governmental Approvals..................................... 16
3.6 Defaults Under Other Documents............................ 16
3.7 Judgments.................................................. 16
3.8 Compliance with Laws....................................... 16
3.9 Taxes...................................................... 16
3.10 Collateral................................................. 16
3.11 Pension Benefits........................................... 16
3.12 Margin Regulations......................................... 17
3.13 Financial Condition........................................ 17
4.1 Financial Reports.......................................... 17
4.2 Corporate Structure and Assets............................. 19
4.3 Net Worth.................................................. 19
4.4 Indebtedness............................................... 19
4.5 Use of Proceeds............................................ 19
4.6 Notice of Default.......................................... 20
4.7 Distributions.............................................. 20
4.8 Compliance with Law and Regulations........................ 21
4.9 Maintenance of Property; Accounting; Corporate
Form; Taxes; Insurance................................... 21
4.10 Inspection of Properties and Books......................... 21
4.11 Guaranties................................................. 22
4.12 Collateral................................................. 22
4.13 Name; Location............................................. 22
4.14 Notice of Change in Ownership or Management................ 22
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4.15 Interest Coverage.......................................... 23
4.16 Subordinated Debt.......................................... 23
4.17 Subsidiaries............................................... 23
4.18 Amendments to Purchase Agreement........................... 23
4.19 Capital Expenditures....................................... 23
4.20 Acquisitions............................................... 23
V. CONDITIONS PRECEDENT............................................. 24
5.1 Closing Conditions......................................... 24
VI. DEFAULTS AND REMEDIES........................................... 24
6.1 Events of Default.......................................... 24
6.2 Remedies................................................... 26
VII. INTER-CREDITOR AGREEMENTS..................................... 27
7.1 FNB-O as Servicer.......................................... 27
7.2 Application of Payments.................................... 28
7.3 Liability of FNB-O......................................... 29
7.4 Transfers.................................................. 29
7.5 Reliance................................................... 29
7.6 Relationship of Lenders.................................... 29
7.7 New Lenders................................................ 29
VIII. MISCELLANEOUS................................................ 30
8.1 Entire Agreement........................................... 30
8.2 Governing Law.............................................. 30
8.3 Notices.................................................... 30
8.4 Headings................................................... 30
8.5 Counterparts............................................... 30
8.6 Survival; Successors and Assigns........................... 31
8.7 Severability............................................... 31
8.8 Assignment................................................. 31
8.9 Amendments................................................. 31
8.10 Consent to Form of Security Agreement, Term Agreement...... 31
EXHIBIT A........................................................... 43
EXHIBIT B........................................................... 9
EXHIBIT C........................................................... 11
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1997 REVOLVING CREDIT AGREEMENT
This 1997 REVOLVING CREDIT AGREEMENT (the "Agreement") is entered into as of
the 26th day of February, 1997, among DATA TRANSMISSION NETWORK CORPORATION, a
Delaware corporation having its principal place of business at Suite 200, ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Borrower"), FIRST NATIONAL BANK OF
OMAHA, a national banking association having its principal place of business at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("FNB-O"), FIRST NATIONAL BANK,
WAHOO, NEBRASKA, a national banking association having its principal place of
business at ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("FNB-W"), NBD BANK, a bank organized under
the laws of the State of Michigan and having its principal place of business at
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("NBD"), NORWEST BANK NEBRASKA,
N.A., a national banking association having its principal place of business at
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Norwest"), THE SUMITOMO BANK,
LIMITED, a Japanese bank being represented by its office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and acting through its Chicago branch
("Sumitomo"), MERCANTILE BANK OF ST. LOUIS, N.A., a national banking association
having its principal place of business at One Mercantile Center, 7th and
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Mercantile"), FIRST BANK,
NATIONAL ASSOCIATION (successor in interest to FirsTier Bank, National
Association), a national banking association having its principal place of
business at ▇▇▇▇ ▇▇▇ ▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("First Bank"), THE
BOATMEN'S NATIONAL BANK OF ST. LOUIS, a national banking association having its
principal place of business at One Boatmen's Plaza, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇
▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("Boatmen's"), BANK OF MONTREAL, a Canadian
bank represented by its office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
("Montreal"), and LASALLE NATIONAL BANK, a national banking association being
represented by its offices at One Metropolitan Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("LaSalle").
WITNESSETH:
WHEREAS, the Borrower and certain of the Lenders (as such term is
hereinafter defined) are parties to a 1996 Term Credit Agreement dated as of May
3, 1996, which has been amended, (the "1996 Term Credit Agreement"), the
proceeds of which were used to acquire substantially all of the assets of
Broadcast Partners, a general partnership having its principal place of business
in Des Moines, Iowa;
WHEREAS, the Borrower and certain of the Lenders are parties to a 1996
Revolving Credit Agreement dated as of June 28, 1996, which has been amended
(the "1996 Revolving Credit Agreement"), which 1996 Revolving Credit Agreement
provided a revolving credit facility for general corporate purposes;
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WHEREAS, the Borrower desires to increase the amount and extend the maturity
of the revolving credit facility which was the subject of the 1996 Revolving
Credit Agreement; and
WHEREAS, the parties do not intend for this 1997 Revolving Credit Agreement
to be deemed to extinguish any existing indebtedness of the Borrower or to
release, terminate or affect the priority of any security therefor, but the
parties do intend that this 1997 Revolving Credit Agreement shall supersede and
replace the terms of the above-referenced 1996 Revolving Credit Agreement;
NOW, THEREFORE, in consideration of the premises, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, it is agreed as follows:
I. DEFINITIONS
For purposes of this Agreement, the following definitions shall apply:
Acquisition
Notes: The Notes issued by the Borrower to the Term Lenders
under the Term Agreement, and all extensions, renewals and
substitutions, if any, of or for the same.
Advance: Any advance of funds to the Borrower by the Revolving
Lenders or any of them under the revolving credit facility
provided in this Agreement.
Agreement: This 1997 Revolving Credit Agreement dated as of February
26, 1997, between the Borrower and certain Lenders, as
amended or restated from time to time.
Base Rate: The floating interest rate announced from time to
time by FNB-O as its "National Base Rate." The National
Base Rate is set by FNB-O, solely in its discretion, to
reflect generally the rates charged by national money
center banks as their reference rates. (Previously, the
rate was announced by FNB-O as its "New York Base Rate.")
Rates charged by FNB-O may be at, above or below the
National Base Rate, as determined by FNB-O as to each
respective customer.
Boatmen's: The Boatmen's National Bank of St. Louis, a national
banking association having its principal place of business
at ▇▇▇ ▇▇▇▇▇▇▇'▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, and its successors and assigns.
Borrower: Data Transmission Network Corporation, a Delaware
corporation having its principal place of business at
▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
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Broadcast
Partners: Broadcast Partners, a general partnership having its
current principal place of business at ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇.
Business
Day: Any day other than a Saturday, Sunday or a legal holiday
on which banks in the State of Nebraska are not open for
business.
Change of
Control: (a) At any time when any of the equity securities of the
Borrower shall be registered under Section 12 of the
Securities Exchange Act of 1934 as amended from time to
time (the "Exchange Act"), (i) any person, entity or
"group" (within the meaning of Section 13(d)(3) of the
Exchange Act) (other than any person which is a management
employee, or any such "group" which consists entirely of
management employees, of the Borrower) being or becoming
the beneficial owner, directly or indirectly, of more than
50% of the voting stock of the Borrower, or (ii) a
majority of the members of the Borrower's board of
directors (the "Board") consisting of persons other than
Continuing Directors (as hereinafter defined); and (b) at
any other time, less than 50% of the voting stock of the
Borrower being owned beneficially, directly or indirectly,
by employees of the Borrower or its subsidiaries. As used
herein, the term "Continuing Director" means any member of
the Board on June 29, 1995, and any other member of the
Board who shall be recommended or elected to succeed a
Continuing Director by a majority of Continuing Directors
who are the members of the Board.
Collateral: All personal property of the Borrower described in the
Security Agreement, whether now owned or hereafter
acquired, including, without limitation:
(a) all of the Borrower's accounts, accounts
receivable, Subscriber contract rights, chattel paper,
documents, instruments, goods, inventory, equipment,
general intangibles; and
(b) all proceeds and products of the foregoing.
Conversion: This term shall have the meaning set forth in Section 2.4.
Converted
Notes: Any note evidencing Conversion under or of all or a
portion of the Revolving Credit Notes (or any such similar
notes issued to any additional Revolving Lenders
hereinafter added to this Agreement), and all extensions,
renewals and substitutions of or for the foregoing.
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Default Rate: The floating interest rate announced from time to
time by FNB-O as its "National Base Rate" plus 4.0%. The
National Base Rate is set by FNB-O, solely in its
discretion, to reflect generally the rates charged by
national money center banks as their reference rates.
(Previously, the rate was announced by FNB-O as its "New
York Base Rate.") Rates charged by FNB-O may be at, above
or below the National Base Rate, as determined by FNB-O as
to each respective customer.
Existing
Term Notes: Those certain promissory notes from the Borrower to
FNB-O, FirsTier, FNB-W, NBD, Norwest and Boatmen's dated
as of April 16, 1993, July 8, 1993, August 30, 1994,
November 29, 1994, and February 27, 1995, and all
extensions, renewals, and substitutions of or for the
foregoing.
First Bank: First Bank, National Association, a national banking
association having its principal place of business at 13th
and ▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and its successors
and assigns (it being acknowledged that First Bank is the
successor in interest to FirsTier).
FNB-O: First National Bank of Omaha, a national banking
association having its principal place of business at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and its
successors and assigns.
FNB-W: First National Bank, Wahoo, Nebraska, a national banking
association having its principal place of business at
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and its successors and assigns.
Fixed Rate
Notice: This term shall have the meaning set forth in Section 2.5.
Interest Rate
Protection
Contract
Amounts: "Interest Rate Protection Contract Amounts" shall mean
amounts due from the Borrower under interest rate
protection contracts between the Borrower and one or more
Lenders as to (i) the interest differential amounts due in
respect of periodic netting payments under any such
contract, and (ii) any amount due as a result of marking
to market the Borrower's obligations under any such
contract upon the occurrence of an event of default under,
or other early termination of, such contract; in either
case without inclusion of fees and other expenses related
to such contract. Such Interest Rate Protection Contract
Amounts shall be reported in writing to FNB-O and the
Borrower by the applicable Lender at such times as shall
be appropriate to carry out the intent of this Agreement.
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LaSalle: LaSalle National Bank, a national banking association
having its principal place of business at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Lenders: FNB-O, FNB-W, NBD, Norwest, LaSalle, Sumitomo, Mercantile,
First Bank and Montreal, in their capacity as Revolving
Lenders under this Agreement, the Term Lenders, lenders of
the Related Bank Debt, Boatmen's (as to Articles VI and
VII and as to Section 8.6 only), and such additional
lenders as may be added hereto or thereto from time to
time.
Leverage
Ratio: The number which is obtained at the time of determination
by dividing Total Indebtedness at the applicable time by
Operating Cash Flow at the applicable time.
Make-Whole
Premium: An amount which shall be sufficient as determined by the
relevant Lender in good faith and on a reasonable basis
and certified to the Borrower in writing, to compensate
the Lender for any loss (including any lost yield), cost
or expense incurred by the Lender (i) in liquidating or
redeploying deposits or other funds acquired by the Lender
to fund or maintain the loan prepaid and (ii) in
unwinding, amending, canceling or otherwise modifying or
terminating any match funding, swap or other arrangement
entered into by the Lender in connection with acquiring or
maintaining the funding for the loan prepaid.
Mercantile: Mercantile Bank of St. Louis, N.A., a national banking
association having its principal place of business at One
Mercantile Center, 7th and ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and its successors and assigns.
Montreal: Bank of Montreal, a Canadian bank being represented by its
offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
NBD: NBD Bank, a bank organized under the laws of the State of
Michigan and having its principal place of business at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and its
successors and assigns.
Net Operating
Profit After
Taxes: For any period, the net earnings (or loss) after taxes of
Borrower and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period and
determined in conformity with generally accepted
accounting principles; provided that there shall be
excluded (i) the income (or loss) of any entity accrued
prior to the date it becomes a Subsidiary of Borrower or
is merged into or consolidated with Borrower and (ii) any
extraordinary gains or losses for such period determined
in accordance with generally accepted accounting
principles.
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Net Worth: The Borrower's consolidated net worth as determined
in accordance with generally accepted accounting
principles plus subordinated debt. For purposes of this
definition, "subordinated debt" means indebtedness of the
Borrower which is subordinate, in a manner satisfactory to
the Lenders, to the indebtedness due to the Lenders, and
the repayment of which is forbidden during the existence
of any Event of Default hereunder; provided however, that
any such indebtedness shall not be deemed subordinated
debt to the extent of the amount of principal payments
that are due thereon within one (1) year from the date of
determination.
Norwest: Norwest Bank Nebraska, N.A., a national banking
association having its principal place of business at 20th
and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and its
successors and assigns.
Notes: (i) The Revolving Credit Notes, the Converted Notes, the
Existing Term Notes, the Acquisition Notes, and such
additional similar notes as may be issued to certain
additional Lenders, and all extensions, renewals, and
substitutions of or for the foregoing; and (ii) notes and,
in the case of interest rate protection contracts, such
contracts evidencing the obligations of the Borrower to
any Lender under the Related Bank Debt.
Operating
Cash Flow: The Borrower's consolidated average monthly earnings
or loss before interest, depreciation, amortization and
taxes, less current tax expense and plus or minus any
non-ordinary non-cash charges or credits to earnings,
which average shall be based on the Borrower's actual
financial results in the two (2) full calendar months
preceding the date of determination. For purposes of
calculating Operating Cash Flow for this Agreement, the
Borrower shall not permit deferred commission expenses to
be capitalized for any period in excess of twelve (12)
months.
Operative
Documents: This Agreement, the Notes, the Security Agreement, the
financing statements regarding the Collateral and the
documents and certificates delivered pursuant to Section
5.1.
Principal
Loan
Amount: As to the Revolving Credit Notes, the aggregate prin-
cipal amount of all unpaid Advances outstanding at any
time (not including the unpaid balance under the
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Related Bank Debt, Existing Term Notes or any Acquisition
Notes, or any amounts converted to a term loan hereunder),
and as to Converted Notes hereunder, the unpaid principal
amount thereof.
Purchase
Agreement: The Asset Purchase and Sale Agreement dated as of
May 3, 1996, between the Borrower and Broadcast Partners,
as amended from time to time.
Quarterly
Compliance
Certificate: The certificate delivered to the Lenders by the Borrower
pursuant to Section 4.1(d).
Related
Bank Debt: The aggregate unpaid balance of all indebtedness,
now or hereafter existing (including future advances)
under (i) the Related Loan Agreement, including, without
limitation, the amounts outstanding under those certain
promissory notes from the Borrower to FNB-O, FirsTier and
FNB-W dated as of October 13, 1992 and December 7, 1992,
and all extensions, renewals, and substitutions of or for
the foregoing; and (ii) certain interest rate protection
contracts entered into from time to time by the Borrower
with one or more of the Lenders.
Related
Loan
Agreement: The Loan Agreement dated as of October 9, 1992, between
the Borrower and FNB-O, FirsTier and FNB-W and any loan
agreements issued in extension, renewal, replacement, or
restatement of the foregoing.
Release: The Federal Reserve Statistical Release.
Restricted
Quarter: This term shall have the meaning set forth in Section 2.5
hereof.
Revolving
Credit Notes: The Notes issued to the Revolving Lenders pursuant
to Section 2.1, and such additional similar notes as may
be issued to Revolving Lenders hereinafter added to this
Agreement by mutual written agreement of the parties, and
all extensions, renewals, and substitutions of or for the
same. Such notes shall be in the form of Exhibit A hereto.
Revolving
Credit Rate: The Base Rate minus the applicable margin as determined
pursuant to Section 2.3.
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Revolving
Lenders: FNB-O, FNB-W, NBD, Norwest, LaSalle, Sumitomo, Mercantile,
First Bank and Montreal, and such additional Revolving
Lenders as may be added as Revolving Lenders under Section
2.1 hereto from time to time by mutual written agreement
of the parties.
Security
Agreement: The 1997 Security Agreement dated as of the date hereof,
between the Borrower and FNB-O, as agent for the Lenders,
(which amends and restates the 1996 Restated Security
Agreement dated as of May 3, 1996, as amended by the First
Amendment to 1996 Restated Security Agreement dated as of
June 28, 1996; the Second Amendment to 1996 Restated
Security Agreement dated as of July 31, 1996; and the
Third Amendment to 1996 Restated Security Agreement dated
as of December 27, 1996), and as further amended or
restated from time to time.
Subscribers: Those customers of the Borrower which have subscribed for
the Borrower's "Basic DTN Subscription Service" and/or
"Farm Dayta Service" and/or other similar services and who
are not in default of their payment or other obligations
with respect thereto.
Subsidiary: Any corporation business association, partnership, joint
venture, limited liability company or other business
entity in which the Borrower, or one or more of its
Subsidiaries, or the Borrower and one or more of its
Subsidiaries has either (i) more than 50% of the equity
ownership thereof, or (ii) the power to elect a majority
of the directors or to control the identification of the
managing or general partners or similar governing persons
thereof.
Sumitomo: The Sumitomo Bank, Limited, a Japanese bank being
represented by its office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and acting through its
Chicago branch, and its successors and assigns.
Term
Agreement: The 1997 Term Credit Agreement dated as of the date
hereof, among the Borrower and certain Lenders specified
therein, (which amends and restates the 1996 Term Credit
Agreement dated as of May 3, 1996, as amended by the First
Amendment to 1996 Term Credit Agreement dated as of July
17, 1996; the Second Amendment to 1996 Term Credit
Agreement dated as of July 31, 1996; and the Third
Amendment to 1996 Term Credit Agreement dated as of
December 27, 1996), and as further amended or restated
from time to time.
▇▇
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▇▇▇▇
▇▇▇▇▇▇▇: "Lenders" to the Borrower as such term is defined in the
Term Agreement.
Total
Indebtedness: All loans and other obligations of the Borrower and its
Subsidiaries, without duplication, for borrowed money
(including, without limitation, the indebtedness due to
the Lenders) regardless of the maturity thereof but such
term shall not include subordinated debt of the Borrower,
as such term is defined in the definition of Net Worth up
to $15,000,000 if such subordinated debt was existing on
May 3, 1996. For purposes of this definition of "Total
Indebtedness," indebtedness under an interest rate
protection agreement shall mean the amount if any, at the
time of determination, of the unpaid Interest Rate
Protection Contract Amounts; provided, however, that
solely for purposes of voting under this Agreement by the
Lenders, "Total Indebtedness" will not include such
Interest Rate Protection Contract Amounts.
Trigger
Event: This term shall have the meaning set forth in Section 2.5
hereof.
All accounting terms not otherwise defined herein shall have the meaning
ordinarily applied under generally accepted accounting principles.
II. REVOLVING FACILITY
2.1 Revolving Credit.
(a) Until the earlier of June 30, 1998, or the date on which the
loan hereunder is converted to a term loan in accordance with Section 2.4,
the Revolving Lenders severally agree to advance funds for general corporate
purposes not to exceed $59,500,000 (the "Base Revolving Credit Facility") to
the Borrower on a revolving credit basis (amounts outstanding under the
Acquisition Notes, Existing Term Notes and Related Bank Debt shall not be
counted against such Base Revolving Credit Facility limit). Such Advances
shall be made on a pro rata basis by the Revolving Lenders, based on the
following maximum advance limits and applicable percentages for each
Revolving Lender: (i) as to FNB-O, $12,316,500 (20.7%); (ii) as to FNB-W,
$297,500 (.50%); (iii) as to NBD, $7,080,500 (11.9%); (iv) as to Norwest,
$2,856,000 (4.8%); (v) as to LaSalle, $11,840,500 (19.9%); (vi) as to
Sumitomo, $5,950,000 (10%); (vii) as to Mercantile, $6,128,500 (10.3%),
(viii) as to First Bank, $6,128,500 (10.3%); and (ix) as to Montreal,
$6,902,000 (11.6%).
(b) The Base Revolving Credit Facility shall be increased, up to a
maximum of $71,000,000, upon satisfaction of the following conditions. For
each six-month period shown below, the Base Revolving Credit Facility shall
be increased in the amount shown, up to the maximum indicated for such
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period, based on the conversion in accordance with Section 2.4 below of
outstanding balances on the Revolving Credit Notes:
Maximum Principal
Conversion Amount Maximum Increase In
Period Increasing Facility Size Revolving Credit Facility
-------------------- ------------------------ -------------------------
January-June, 1997 $38,000,000 $11,500,000
July-December, 1997 $38,000,000 minus the
principal amount, if
any, converted during the
prior period $ 7,667,000
January-June, 1998 $38,000,000 minus the
principal amount, if
any, converted during the
prior periods $ 3,833,000
provided, however, that the total amount of converted principal which shall
result in an increase to the Base Revolving Credit Facility over the term
hereof shall not exceed $38,000,000; and provided, further, that regardless
of conversions, in no event shall the Base Revolving Credit Facility, plus
the principal amount outstanding under Converted Notes issued after the date
hereof, exceed $71,000,000; and provided further, that no such increase in
the Base Revolving Credit Facility amount shall occur after the occurrence
of an Event of Default. In the event that the principal amount converted
during any six-month period shown above is less than the maximum principal
conversion amount shown above for such period, the amount of the increase
shall be determined by multiplying the maximum possible increase in the
revolving credit facility permitted for such period by a fraction, the
numerator of which is the amount of actual converted principal (up to the
maximum permitted) and the denominator of which is the difference between
$38,000,000 and the principal amount converted during any of the prior
six-month periods shown on the above chart. The "Maximum Revolving Credit
Facility" shall mean, as of the date of this Agreement, $71,000,000, and, if
the maximum increase in the Base Revolving Credit Facility is not effected
prior to July 1, 1997, shall be adjusted on July 1, 1997, and, if
applicable, on January 1, 1998 to reflect such lesser maximum amount which
is possible to be effected during the succeeding six-month period pursuant
to the above chart.
(c) Any increase in the Base Revolving Credit Facility shall be pro
rated among the Revolving Lenders in the percentages shown in (a) above;
provided that in no event shall the respective revolving credit facility
attributable to each such Revolving Lender exceed the amounts shown below:
(i) as to FNB-O, $14,697,000; (ii) as to FNB-W, $355,000; (iii) as to
13
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NBD, $8,449,000; (iv) as to Norwest, $3,408,000; (v) as to LaSalle, $14,129,000;
(vi) as to Sumitomo, $7,100,000; (vii) as to Mercantile, $7,313,000; (viii) as
to First Bank, $7,313,000; and (ix) as to Montreal, $8,236,000.
The Borrower shall not be entitled to any Advance hereunder if, after the making
of such Advance, the Total Indebtedness would exceed thirty-six (36) times the
Borrower's Operating Cash Flow, determined at the time of the Advance. Nor shall
the Borrower be entitled to any further Advances hereunder after the occurrence
of a material adverse change in its management personnel, as described in
Section 4.14(b), or after the occurrence of any Event of Default with respect to
the Borrower. Advances shall be made, on the terms and conditions of this
Agreement, upon the Borrower's request. Requests shall be made by 12:00 noon
Omaha time on the Business Day prior to the requested date of the Advance.
Requests shall be made by presentation to FNB-O of a drawing certificate in the
form of Exhibit B. The Borrower's obligation to make payments of principal and
interest on the foregoing revolving credit indebtedness shall be further
evidenced by the Revolving Credit Notes.
2.2 Revolving Credit Fees. The Borrower shall pay to the Revolving
Lenders a commitment fee equal to the product of the per annum unused commitment
fee percentage shown below times the unadvanced portion of the Maximum Revolving
Credit Facility described above:
Leverage Ratio Unused Commitment Fee Percentage
--------------------------- --------------------------------
Greater than 42 .375%
Greater than 24 but not in
excess of 42 .250%
24 or less .125%
Such fee shall be paid to FNB-O quarterly (calendar quarters) in arrears and
based on the average unused portion of the revolving credit commitment during
the applicable quarter and the Leverage Ratio in effect on the last day of the
month preceding such quarter. FNB-O shall distribute to each Revolving Lender
its pro rata share of such fee based on the maximum advance limits set forth
above. Furthermore, the Borrower will pay to FNB-O an agenting fee equal to
$40,000 annually, payable quarterly in arrears.
2.3 Interest on Revolving Credit. Until the earlier of June 30,
1998, or the date on which the revolving credit loan hereunder is converted to a
term loan, interest shall accrue on the Principal Loan Amount outstanding from
time to time at a variable rate, which shall fluctuate on a monthly basis, equal
to the Base Rate minus a margin as determined below. The margin shall be
adjusted quarterly after receipt of the Borrower's Quarterly Compliance
Certificate, commencing with the Quarterly Compliance Certificate in the form of
Exhibit C hereto for the quarter ended 12/31/96. Adjustments shall be
retroactive to the beginning of the current quarter.
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Leverage Ratio Margin Below Base Rate
----------------------------- ----------------------
Greater than 42 .25%
Greater than 36 but not more
than 42 .50%
Greater than 30 but not more
than 36 .75%
Greater than 24 but not more
than 30 1.00%
Greater than 18 but not more
than 24 1.25%
18 or less 1.375%
The Base Rate minus the applicable margin as determined above is hereinafter
referred to as the "Revolving Credit Rate." Changes in the Base Rate shall be
effective on the first day of each month, based on the Base Rate in effect as of
such day. Interest shall be due upon the rendering of each monthly invoice
therefor by FNB-O. Notwithstanding anything to the contrary elsewhere herein,
after an Event of Default has occurred interest shall accrue on the entire
outstanding balance of principal and interest on all indebtedness hereunder at a
fluctuating rate equal to the Default Rate.
2.4 Conversion. Upon the earlier of: (i) June 30, 1998; or (ii) the
Borrower's giving notice of its election to convert the revolving credit loan
hereunder, or any portion thereof, to a term loan, the revolving credit loan
described above (or applicable portion thereof) shall be deemed converted to a
term loan (hereinafter referred to as "Conversion"). Any such term loans shall
be evidenced by notes (the "Converted Notes") separate from the initial
Revolving Credit Notes. Upon the issuance of Converted Notes, the Revolving
Credit Facility will be reduced by the principal amount of such Converted Notes
(and shall be increased to the extent permitted in Section 2.1(b) hereof), and
no further Advances shall be made by the Revolving Lenders on the converted
amount. The then outstanding Principal Loan Amount of each respective Converted
Note shall become due and payable in forty-eight (48) equal installments of
principal, with the first such installment due on the last day of the month
following Conversion, or, if such day is not a Business Day, on the next
succeeding Business Day, and subsequent installments due on the last day of each
consecutive month thereafter. In any event, the total amount of all unpaid
principal and accrued interest hereunder shall be due and payable no later than
June 30, 2002.
2.5 Interest on Converted Notes. After Conversion, interest shall
accrue on the Principal Loan Amount outstanding on the respective Converted Note
from time to time at a variable rate, which shall fluctuate on a monthly basis,
which is equal to the Revolving Credit Rate plus one quarter of one percent
(.25%). For purposes of computing such variable rate, changes in the Base Rate
shall be effective on the first day of each month based on the Base Rate in
15
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effect on such day. Notwithstanding anything in the foregoing to the contrary,
after Conversion, the Borrower may elect to have a fixed interest rate apply to
the outstanding Principal Loan Amount converted and outstanding after the date
of giving notice of such fixed rate election (the "Fixed Rate Notice"). Such
fixed rate shall be the greater of:
(a) the Revolving Credit Rate in effect on the date of the notice,
plus one-half of one percent (.50%), or
(b) the average of the yields on constant maturity Treasury
Bonds with maturities of three (3) years and five (5) years, as quoted
in the immediately preceding monthly Release for the month preceding such
Release, plus the incremental percentage shown below:
Leverage Ratio1 Incremental %
--------------- -------------
Greater than 36 2.25%
Greater than 24 but not in
excess of 36 2.00%
24 or less 1.75%
1 Determined on the last day of the preceding quarter.
Any election of a fixed rate by the Borrower shall be final and irrevocable.
Interest shall be due each month concurrently with the Borrower's principal
payment. Notwithstanding anything to the contrary elsewhere herein, after an
Event of Default has occurred interest shall accrue on the entire outstanding
balance of principal and interest on all indebtedness hereunder at a fluctuating
rate equal to the Default Rate. All interest due under this Agreement shall be
calculated on the basis of the actual number of days outstanding and a 360-day
year. Interest shall continue to accrue on the full unpaid balance of all
indebtedness hereunder notwithstanding any permitted or unpermitted failure of
the Borrower to make a scheduled payment or the fact that a scheduled payment
day falls on a day other than a Business Day. If the Borrower's most recent
Quarterly Compliance Certificate shows that, as of the end of the prior quarter,
Total Indebtedness was at such date more than thirty-six (36) times the
Operating Cash Flow at the end of such quarter, the current quarter shall be
deemed a "Restricted Quarter." If, any time during a Restricted Quarter
(including, without limitation, during any period in such quarter prior to
delivery of the Quarterly Compliance Certificate), the interest rate accruing on
any Existing Term Note or Converted Note is less than seven and one-half percent
(7.50%) per annum, a "Trigger Event" shall be deemed to have occurred. Upon the
occurrence of a Trigger Event, the Borrower shall be obligated to pay the
following fees: (i) three-eighths of one percent (.375%) of the outstanding
principal balance as of the date preceding the Trigger Event of each Existing
Term Note or Converted Note which accrues interest at less than seven and
16
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one-half percent (7.50%) per annum, which amount shall be payable promptly upon
invoicing by FNB-O; (ii) the same amount as computed in clause (i), payable on
the six (6) month anniversary of the Trigger Event; and (iii) the same amount as
computed in clause (i), payable on the twelve (12) month anniversary of the
Trigger Event.
2.6 Payments. All obligations of the Borrower under the Related
Bank Debt (other than obligations under any interest rate protection contract),
Revolving Credit Notes and Converted Notes and under the other Operative
Documents shall be payable in immediately available funds in lawful money of the
United States of America at the principal office of FNB-O in Omaha, Nebraska or
at such other address as may be designated by FNB-O in writing. In the event
that a payment day is not a Business Day, the payment shall be due on the next
succeeding Business Day.
2.7 Prepayments. The Borrower may at any time prepay the Principal
Loan Amount outstanding under the Revolving Credit Notes or any of the Converted
Notes if the Borrower has given the Revolving Lenders at least two (2) Business
Days prior written notice of its intention to make such prepayment. Any such
prepayment may be made without penalty except for Converted Notes as to which
interest is accruing at a fixed rate in accordance with Section 2.5, in which
event a prepayment penalty shall be due to each Revolving Lender, at each
Revolving Lender's option, either: (1) the Make-Whole Premium due to such
Revolving Lender in respect of such prepayment; or (2) such Revolving Lender's
applicable prepayment fee as set forth below. The applicable prepayment fee for
any Converted Note shall be: (i) if the notice electing fixed interest was given
within twelve (12) months of Conversion, the fee shall be one and one-half
percent (1.50%) of the amount of such prepayment; (ii) if the notice electing
fixed interest was given after twelve (12) months of Conversion but within
twenty-four (24) months of Conversion, the fee shall be three-fourths of one
percent (.75%) of the amount of such prepayment; (iii) if the notice electing
fixed interest was given after twenty-four (24) months of Conversion but within
thirty-six (36) months of Conversion, the fee shall be three-tenths of one
percent (.30%) of the amount of such prepayment. The applicable prepayment fee
for any Existing Term Note shall be as specified in such Existing Term Note.
2.8 Security. All obligations of the Borrower hereunder and under
the Operative Documents, including, without limitation, the Borrower's
obligations to make payments of principal and interest on the Notes shall be
secured by a first security interest in the Collateral, as more specifically
described in the Security Agreement.
2.9 Existing Term Notes. The Borrower's obligations under the
Existing Term Notes shall continue in full force and effect in accordance with
the terms thereof. Such notes shall be deemed amended to include this 1997
Revolving Credit Agreement within the definition of Obligations in such notes,
it being understood that this 1997 Revolving Credit Agreement, rather than the
1996 Revolving Credit Agreement, shall be controlling with respect to defaults,
covenants and all other relevant matters arising under the Existing Term Notes
and the Notes executed and delivered in connection with this 1997 Revolving
Credit Agreement. The Existing Term Notes shall continue to be secured by the
security interest provided in the Security Agreement.
17
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2.10 Related Loan Agreement. Nothing herein shall be deemed to
alter or amend the Borrower's obligations under the Related Loan Agreement, the
Related Bank Debt or any collateral security therefor, all of which shall
continue in full force and effect in accordance with the terms thereof.
III. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that as of the date hereof
and as of the date of each and every request for an Advance hereunder, the
following are and shall be true and correct:
3.1 Corporate Existence. It and each of its Subsidiaries, if any,
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and duly qualified and in good standing in all
states where it is doing business except where the failure to be so qualified
would not have a material adverse effect on it and it has full power and
authority to own and operate its properties and to carry on its business. As of
the date of this Agreement, the Borrower has no Subsidiaries.
3.2 Corporate Authority. It has full corporate power, authority
and legal right to execute, deliver and perform the Operative Documents to which
it is a party, and all other instruments and agreements contemplated hereby and
thereby, and to perform its obligations hereunder and thereunder; and such
actions have been duly authorized by all necessary corporate action, and are not
in conflict with any applicable law or regulation, or any order, judgment or
decree of any court or other governmental agency or instrumentality or its
articles of incorporation or bylaws, or with any provisions of any indenture,
contract or agreement to which it or any of its Subsidiaries is a party or by
which it or any of its Subsidiaries or any of its or their property may be
bound.
3.3 Validity of Agreements. The Borrower's Operative Documents
have been duly authorized, executed and delivered and constitute its legal,
valid and binding agreements, enforceable against the Borrower in accordance
with their respective terms (except to the extent that enforcement thereof may
be limited by any applicable bankruptcy, reorganization, moratorium or similar
laws now or hereafter in effect, or by principles of equity).
3.4 Litigation. Neither the Borrower nor any Subsidiary is a
party to any pending lawsuit or proceeding before or by any court or
governmental body or agency, which is likely to have a materially adverse effect
on the Borrower's ability to perform its obligations under its Operative
Documents; nor is the Borrower aware of any threatened lawsuit or proceeding, to
which it or any Subsidiary may become a party or of any investigation of any
Court or governmental body or agency into its affairs, which if instituted would
have a material adverse effect upon the Borrower's ability to perform its
obligations under its Operative Documents.
18
- 105 -
3.5 Governmental Approvals. The execution, delivery and perfor-
▇▇▇▇▇ by the Borrower of the Operative Documents or the Purchase Agreement do
not require the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any federal,
state or other governmental authority or agency other than as contemplated
herein and therein.
3.6 Defaults Under Other Documents. Neither the Borrower nor any
Subsidiary is in default or in violation (nor has any event occurred which, with
notice or lapse of time or both, would constitute a default or violation) under
any document or any agreement or instrument to which it may be a party or under
which it or any of its properties may be bound and the result of which would
have a material adverse effect upon the Borrower's ability to perform its
obligations under its Operative Documents.
3.7 Judgments. There are no outstanding or unpaid judgments (which
are not adequately bonded) of the Borrower or any Subsidiary which would have a
material adverse effect upon the Borrower's ability to perform its obligations
under its Operative Documents.
3.8 Compliance with Laws. Neither the Borrower nor any Subsidiary
is in violation of any laws, regulations or judicial or governmental decrees in
any respect which could have any material adverse effect upon the validity or
enforceability of any of the terms of the Borrower's Operative Documents or
which could have a material adverse effect upon the Borrower's ability to
perform its obligations under its Operative Documents.
3.9 Taxes. All tax returns of the Borrower and its Subsidiaries
for material taxes required to be filed have been filed or extensions permitted
by law have been obtained; all taxes of the Borrower and its Subsidiaries of a
material nature and which are due and payable as reflected on such returns have
been paid, other than taxes which are due but for which only a nominal late
payment penalty is payable and for which the taxing authority is not yet
entitled to enforce its remedies for payment thereof and other than taxes being
contested in good faith and with respect to which adequate reserves have been
established; and no material amounts of taxes of the Borrower and its
Subsidiaries not reflected on such returns are payable.
3.10 Collateral. The Borrower has good and marketable title to the
Collateral and the Collateral is free from all liens, encumbrances or security
interests, except as disclosed on Schedule A attached hereto. The Borrower's
principal place of business, chief executive office, and the principal place
where it keeps its records concerning the Collateral is Suite 200, ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The Borrower also keeps certain of its
records regarding the Collateral at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇.
3.11 Pension Benefits. Neither the Borrower nor any Subsidiary
maintains a "Plan" as defined in Section 3 of the Employees Retirement Income
Security Act of 1974 ("ERISA"), or each such entity is in compliance with the
minimum funding requirements with respect to any such "Plan"
19
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maintained by it and it has not incurred any material liability to the Pension
Benefit Guaranty Corporation ("PBGC") or otherwise under ERISA in connection
with any such Plan.
3.12 Margin Regulations. No part of the proceeds of any Advance
hereunder shall be used to purchase or carry any "margin stock" (within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
of the United States) or any "margin security" (within the meaning of Regulation
G of said Board of Governors), or to extend credit to others for the purpose of
purchasing or carrying any such margin stock or margin security. No part of the
proceeds of any Advance hereunder shall be used for any purpose that violates,
or which is inconsistent with, the provisions of Regulation G, T, U or X of said
Board of Governors.
3.13 Financial Condition. The financial condition of the Borrower
and its Subsidiaries is truly and accurately set forth in the most recent
financial statement which has been provided to the Lenders and no material
adverse change has occurred which would make such financial statement inaccurate
or misleading.
IV. COVENANTS
The Borrower hereby covenants that:
4.1 Financial Reports.
(a) Within forty-five (45) days after the end of each month,
the Borrower, at its sole expense, shall furnish the Lenders a consolidated
balance sheet, a statement of earnings of the Borrower and its consolidated
Subsidiaries and a statement of cash flows of the Borrower and its
consolidated Subsidiaries, and such financial statements on a consolidating
basis as to the Borrower, all such financial statements to be prepared in
accordance with generally accepted accounting principles consistently
applied and certified as completed and correct, subject to normal changes
resulting from year-end audit adjustments, by the chief financial officer
of the Borrower.
(b) Within ninety (90) days after the close of the Borrower's
fiscal year, the Borrower, at its sole expense, shall furnish the Lenders:
(i) a consolidated balance sheet, a statement of earnings of the Borrower
and its consolidated Subsidiaries and a statement of cash flows of the
Borrower and its consolidated Subsidiaries, certified by Deloitte & Touche,
or other independent certified public accountants acceptable to the
Lenders, that such financial reports fairly present the financial condition
of the Borrower and its consolidated Subsidiaries and have been prepared in
accordance with generally accepted accounting principles consistently
applied; and (ii) a certificate from such accountants certifying that in
making the requisite audit for certification of the Borrower's financial
statements, the auditors either (1) have obtained no knowledge, and are not
otherwise aware of, any condition or event which constitutes an Event of
Default or which with the passage of time or the giving of notice would
constitute an Event of Default under Sections 4.3, 4.4, 4.7, 4.9(b),
4.9(d), 4.11, 4.19, or 4.20; or (2) have discovered such condition or
event, as specifically set forth in such certificate, which
20
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constitutes an Event of Default or which with the passage of time or the
giving of notice would constitute an Event of Default under such sections.
The auditors shall not be liable to the Lenders by reason of the auditors'
failure to obtain knowledge of such event or condition in the ordinary
course of their audit unless such failure is the result of negligence or
willful misconduct in the performance of the audit.
(c) Within thirty (30) days after submission to the Securities
and Exchange Commission, the Borrower shall provide to the Lenders copies
of its Forms 10K and 10Q, as submitted to the Securities and Exchange
Commission during the term of this Agreement.
(d) Within twenty (20) days after the end of each quarter, the
Borrower, at its expense, shall furnish the Lenders a certificate of the
chief financial officer of the Borrower in the form of Exhibit C, setting
forth such information (including detailed calculations) sufficient to
verify the conclusions of such officer after due inquiry and review, that:
(i) The Borrower and each Subsidiary, either (y)
is in compliance with the requirements set forth in this
Agreement or (z) is NOT in compliance with the foregoing for
reasons specifically set forth therein; and
(ii) The chief financial officer of the Borrower has
reviewed or caused to be reviewed all of the terms of the
Operative Documents of the Borrower and that such review either
(1) has NOT disclosed the existence of any condition or event
which constitutes an event of default or any condition or event
which with the passage of time or the giving of notice would
constitute an event of default under the Operative Documents or
(2) has disclosed the existence of a condition or event which
constitutes an event of default, or a condition or event which
with the passage of time or the giving of notice would constitute
an event of default, under the aforesaid instrument or instruments
and the specific condition or event is specifically set forth.
For the quarter ended December 31, 1996, the Borrower shall provide the
Quarterly Compliance Certificate in the form of Exhibit C, plus the
compliance certificate in the form which was required by the 1996 Revolving
Credit Agreement in effect on December 31, 1996.
(e) The Borrower shall provide the Lenders with such other
financial reports and statements as the Lenders may reasonably request.
21
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4.2 Corporate Structure and Assets. The Borrower shall not merge
or consolidate with any other corporation or entity unless the Borrower shall be
the surviving entity, nor sell any assets except items that are obsolete or no
longer necessary for operation of the business, other than in the ordinary
course of business without the prior written consent of the Lenders. The Lenders
shall be entitled to receive as a prepayment on the Notes the proceeds of any
sale of assets of the Borrower which are prohibited by the preceding sentence.
Notwithstanding the foregoing prepayment requirements, any such prohibited sale
shall remain a violation of this Agreement. In addition, the Borrower shall not
engage in any business materially different from that in which it is presently
engaged without the prior written consent of the Lenders, which consent shall
not be unreasonably withheld. The foregoing restrictions on mergers and
consolidations shall not apply if: (i) in the case of a merger, the Borrower is
the surviving entity and expressly reaffirms its obligations hereunder; (ii) in
the case of a consolidation, the resulting corporation expressly assumes the
obligations of the Borrower hereunder; (iii) the surviving or resulting
corporation is organized under the laws of the United States or a jurisdiction
thereof; (iv) after giving effect to such merger or consolidation, the surviving
or resulting corporation will be engaged in substantially the same lines of
business as are now engaged in by the Borrower; and (v) immediately after giving
effect to such merger or consolidation, no Event of Default will exist
hereunder.
4.3 Net Worth. The Borrower shall maintain a minimum Net Worth
during the term of this Agreement of at least $23,500,000, plus fifty percent
(50%) of the net income (but not losses) of the Borrower for each fiscal year,
commencing with the fiscal year beginning January 1, 1997; provided, however,
solely for purposes of determining compliance with the provisions of this
Section 4.3, "Net Worth" shall not include any subordinated debt.
4.4 Indebtedness.
(a) The Borrower shall not at any time permit the sum of the
Total Indebtedness to the Lenders to exceed forty-eight (48) times
Operating Cash Flow.
(b) On the day the Borrower or a Subsidiary becomes liable with
respect to any debt and immediately after giving effect thereto and to the
concurrent retirement of any other debt, the sum of Total Indebtedness,
plus the amount of any outstanding subordinated debt of the Borrower and
its Subsidiaries, plus the contingent obligations of the Borrower and its
Subsidiaries under any guaranty of the debt of any other person or entity
(other than unsecured debt of a Subsidiary incurred in the ordinary course
of business for other than borrowed money or to finance the purchase price
of any property or business) shall not exceed an amount equal to sixty (60)
times Operating Cash Flow at such date.
4.5 Use of Proceeds. The Borrower shall not use the proceeds of
the Advances hereunder to purchase or carry any "margin stock" (within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
of the United States) or any "margin security" (within the meaning of Regulation
G of said Board of Governors), or to extend credit to others for the purpose of
22
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purchasing or carrying any such margin stock or margin security. No part of such
proceeds shall be used for any purpose that violates, or which is inconsistent
with, the provisions of Regulation G, T, U or X of said Board of Governors. This
section shall not preclude the Borrower from repurchasing any of its own issued
and outstanding common stock; provided, however, that such repurchase does not
result in the occurrence of any other Event of Default hereunder.
4.6 Notice of Default. The Borrower shall give to the Lenders
prompt written notification of the existence or occurrence of:
(a) any fact or event which results, or which with notice or the
passage of time, or both, would result in an Event of Default hereunder;
(b) any proceedings instituted by or against the Borrower in any
federal, state or local court or before any governmental body or agency, or
before any arbitration board, or any such proceedings threatened against
the Borrower by any governmental agency, which is likely to have a material
adverse effect upon the Borrower's ability to perform its obligations under
its Operative Documents;
(c) any default or event of default involving the payment of money
under any agreement or instrument which is material to the Borrower or any
Subsidiary to which such entity is a party or by which it or any of its
property may be bound, and which default or event of default would have a
material adverse effect upon the Borrower's ability to perform its
obligations under its Operative Documents; and
(d) the Borrower shall give immediate notice of the
commencement of any proceeding under the Federal Bankruptcy Code by or
against the Borrower or any Subsidiary.
4.7 Distributions.
(a) Neither Borrower nor any Subsidiary shall declare any
dividends or make any cash distribution in respect of any shares of its
capital stock or warrants of its capital stock, without the prior written
consent of the Lenders; provided, however, that the Borrower may declare
stock dividends; provided, further, that the Borrower need not obtain the
Lenders' consent with respect to (i) dividends in any one (1) year which
are, in the aggregate, less than 25% of the Borrower's Net Operating Profit
After Taxes in the previous four (4) quarters, as reported to the Lenders
pursuant to Section 4.1; or (ii) dividends or distributions from any
consolidated Subsidiary.
(b) Neither the Borrower nor any Subsidiary other than a
Subsidiary which is wholly-owned by the Borrower shall purchase, redeem, or
otherwise retire any shares of its capital stock or warrants of its capital
stock if, immediately after the making of such purchase or redemption, the
Borrower or any Subsidiary will be in default of any other covenant or
provision of this Agreement (including, without limitation, the covenants
and provisions pertaining to minimum net worth and limitations on
indebtedness).
23
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4.8 Compliance with Law and Regulations. The Borrower and each
Subsidiary shall comply in all material respects with all applicable federal and
state laws and regulations.
4.9 Maintenance of Property; Accounting; Corporate Form;
Taxes; Insurance.
(a) The Borrower and each Subsidiary shall maintain its
property in good condition in all material respects, ordinary wear and tear
excepted, and make all renewals, replacements, additions, betterments and
improvements thereto necessary for the efficient operation of its business.
(b) The Borrower and each Subsidiary shall keep true books of
record and accounts in which full and correct entries shall be made of all
its business transactions, all in accordance with generally accepted
accounting principles consistently applied.
(c) The Borrower and each Subsidiary shall do or cause to be done
all things necessary to preserve and keep in full force and effect its
corporate form of existence as is necessary for the continuation of its
business in substantially the same form, except where such failure to do so
with respect to any Subsidiary would not have a material adverse effect on
the ability of the Borrower to perform its obligations under the Operative
Documents.
(d) The Borrower and each Subsidiary shall pay all taxes,
assessments and governmental charges or levies imposed upon it or its
property; provided, however, that the Borrower or any Subsidiary shall not
be required to pay any of the foregoing taxes which are being diligently
contested in good faith by appropriate legal proceedings and with respect
to which adequate reserves have been established.
(e) The Borrower shall maintain or cause to be maintained
liability insurance and casualty insurance, in a form and amount
satisfactory to FNB-O as agent for the Lenders, upon the Collateral
(excluding equipment or inventory provided to Subscribers in the ordinary
course of business) and other tangible assets owned by it and its
Subsidiaries. The Borrower shall name FNB-O as agent for the Lenders as the
loss payee on all such casualty insurance, and as an additional insured on
all such liability insurance and shall provide the Lenders with evidence of
such insurance upon request.
4.10 Inspection of Properties and Books. The Borrower shall
recognize and honor the right of the Lenders, upon request to an officer of the
Borrower, to visit and inspect any of the properties of, to examine the books,
accounts, and other records of, and to take extracts therefrom and to discuss
the affairs, finances, loans and accounts of, and to be advised as to the same
by the
24
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officers of, the Borrower at all such times, in such detail and through such
agents and representatives as the Lenders may reasonably desire.
4.11 Guaranties. Neither the Borrower nor any Subsidiary shall
guaranty or become responsible for the indebtedness of any other person or
entity; provided, however, that a Subsidiary may guaranty the obligation of the
Borrower; provided further, that the Borrower may guaranty the obligations of a
Subsidiary so long as no Event of Default (or no event or occurrence which with
the passage of time or notice, or both, would become an Event of Default) has
occurred or will occur hereunder, taking into account such guaranty and
indebtedness.
4.12 Collateral. Neither the Borrower nor any Subsidiary shall
incur or permit to exist any mortgage, pledge, lien, security interest or other
encumbrance on the Collateral, except as permitted in the Security Agreement.
Subject to Section 4.4(b), the foregoing shall not be construed to prohibit the
Borrower or any Subsidiary from acquiring leased equipment in the ordinary
course of business. Without limiting the generality of the foregoing, the
Borrower covenants and agrees that it shall on request enforce for the benefit
of the Lenders, but at the sole expense of the Borrower, any and all rights and
remedies (including, without limitation, rights to indemnity), that it may have
with respect to the existence of any liens, security interests or other
encumbrances that may exist on the property of the Borrower acquired from
Broadcast Partners under the Purchase Agreement. Notwithstanding anything else
to the contrary herein or in the Operative Documents, Broadcast Partners shall
have no right to share in the proceeds of any such recovery which constitutes
the proceeds of any indemnity claim by the Borrower under the Purchase
Agreement.
4.13 Name; Location. The Borrower shall give the Lenders ninety
(90) days notice prior to changing its name, identity or corporate structure,
moving its principal place of business, chief executive office or place where it
keeps its records concerning the Collateral.
4.14 Notice of Change in Ownership or Management. During the term
of this Agreement, the Borrower shall give the Lenders notice of the occurrence
of any of the following described events, which notice shall be given as soon as
the Borrower obtains notice or knowledge thereof:
(a) any change, directly or indirectly, in the existing
controlling interest in the Borrower; or
(b) any material adverse change in its management
personnel. A material adverse change in the Borrower's management personnel
shall be deemed to have occurred if any one (1) of the following has
occurred with respect to two of the four (4) individuals who are both
officers and members of the Board of Directors of the Borrower: (i) the
resignation, retirement, or voluntary or involuntary termination of
employment and/or status of such persons as officers and directors of the
Borrower; (ii) any announcement, notice of intent, resolution or similar
advance notice with respect to the matters referenced in the foregoing
clause; or (iii) the death, disability or legal incompetence of such
persons.
25
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4.15 Interest Coverage. The ratio of Operating Cash Flow to
interest expense (as determined in accordance with generally accepted accounting
principles but excluding amortization of deferred offering costs and any fees
related to the Trigger Event in Section 2.5 of this Agreement) at the end of
each quarter during the term of this Agreement, as shown on the Quarterly
Compliance Report, shall not be less than 2.25 to 1.0.
4.16 Subordinated Debt. Neither the Borrower nor any Subsidiary
shall incur any subordinated debt or issue any preferred stock or warrants for
preferred stock except upon the prior written consent of the Lenders. Neither
the Borrower nor any Subsidiary shall make any voluntary or optional prepayment
on any subordinated debt without the prior written consent of the Lenders.
Similarly, the Borrower shall not amend its articles of incorporation or any
other documents or agreements relating to the issuance of subordinated debt,
preferred stock or warrants for preferred stock without the prior written
consent of the Lenders. The indebtedness to Broadcast Partners under the Notes
shall not be considered subordinated debt.
4.17 Subsidiaries. The Borrower shall give prompt written notice to
the Lenders of the Borrower's intent to acquire, or the Borrower's acquisition
of, any Subsidiary. Prior to the creation or acquisition of such Subsidiary, the
Borrower (i) shall cause a first security interest in the assets of such
Subsidiary to be perfected in favor of FNBO, as agent for the Lenders, and (ii)
shall cause the Subsidiary to enter into a security agreement, to execute and
file such financing statements and to provide opinions all in form satisfactory
to the Lenders as to compliance with this section.
4.18 Amendments to Purchase Agreement. The Borrower shall
not amend the Purchase Agreement without the prior written consent of the
Lenders.
4.19 Capital Expenditures. The Borrower shall not incur in any
fiscal year, commencing with the fiscal year beginning January 1, 1997, capital
expenditures, determined in accordance with generally accepted accounting
principles, of more than $1,000,000; provided, however, that capital
expenditures for (a) equipment to be used by Subscribers of the Borrower, and
(b) telecommunication equipment, computer equipment, software, and software
consulting shall not be counted for purposes of this annual limitation.
4.20 Acquisitions. The Borrower shall not acquire any stock or any
equity interest in, or warrants therefor or securities convertible into the
same, or a substantial portion of the assets of, another entity without the
prior written consent of the Revolving Lenders; provided, however, that the
Borrower shall be permitted to make on a cumulative basis from and after the
date of this Agreement such acquisitions in an amount not to exceed Six Million
Dollars ($6,000,000) in the aggregate without the consent of the Revolving
Lenders if such acquisitions are in or from entities which:
(a) are in the business of electronically communicating time-
sensitive information to subscribers;
26
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(b) have their principal place of business in the United States;
and
(c) except for Market Communications Group, L.L.C., have a
positive operating cash flow, calculated in the same method as is used
to calculate the Borrower's Operating Cash Flow for purposes of this
Agreement.
V. CONDITIONS PRECEDENT
5.1 Closing Conditions. Any and all obligations of the
Lenders hereunder are subject to satisfaction of the following conditions
precedent:
(a) FNB-O, as agent, shall have received an opinion of counsel
to the Borrower covering such matters as the Lenders may request
(including, without limitation, corporate existence and good standing,
corporate authority, due authorization, execution and delivery of the
Operative Documents, the legal, valid, binding and enforceable nature of
the Operative Documents, the perfection and priority of the security
interest in the Collateral granted to the Lenders, and the Borrower's
compliance with applicable state and federal laws in connection with the
equity offering made in connection with the Purchase Agreement), such
opinion to be satisfactory in form and substance to counsel to FNB-O;
(b) FNB-O, as agent, shall have received such certificates and
documents as the Lenders may reasonably request from the Borrower,
including articles of incorporation and bylaws, certificates regarding good
standing, incumbency, copies of other corporate documents, and appropriate
authorizing resolutions; and
(c) the Operative Documents shall have been duly auth-
orized and executed and shall be in full force and effect, and such UCC
financing statements shall have been executed and filed in such offices as
may be appropriate to perfect the security interest of FNB-O, as agent for
the Lenders, in the Collateral.
VI. DEFAULTS AND REMEDIES
6.1 Events of Default. Any of the following shall be deemed
an event of default under this Agreement (an "Event of Default"):
(a) Any payment of principal required by any of the
Operative Documents shall not be paid when due.
(b) Any payment of interest or other fees due hereunder or under
any of the Operative Documents shall not be paid within fifteen (15)
calendar days after the date on which such payment was invoiced or due.
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(c) Any representation or warranty of the Borrower under
any of the Operative Documents, or any financial reports or statements or
certificates submitted pursuant to this Agreement, shall prove to have been
false in any material respect when made.
(d) A failure of the Borrower or any Subsidiary to comply
with any requirement or restriction applicable to such entity and contained
in Sections 4.1, 4.2, 4.3, 4.4, 4.7, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16,
4.19, or 4.20 of this Agreement.
(e) A failure of the Borrower or any Subsidiary to comply
with any requirement or restriction contained in any provision of the
Operative Documents not otherwise specified in this Article VI, which
failure remains unremedied for ten (10) days following receipt of notice
from FNB-O on behalf of the Lenders.
(f) The occurrence of a default or a breach of any of the
obligations of the Borrower or any Subsidiary (other than obligations of
such Subsidiary to the Borrower) under any note, loan agreement, preferred
stock, subordinated debt instrument or agreement, or any other agreement
evidencing an obligation to repay borrowed money.
(g) The entry of a final judgment against the Borrower or
any Subsidiary for the payment of money, which is not covered by insurance,
and the expiration of thirty (30) days from the date of such entry during
which the judgment is not discharged in full or stayed.
(h) The occurrence of any one or more of the following:
(1) The Borrower or any Subsidiary shall file a
voluntary petition in bankruptcy or an order for relief
shall be entered in a bankruptcy case as to such entity or
shall file any petition or answer seeking or acquiescing
in any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief
for itself under any present or future federal, state or
other statute, law or regulation relating to bankruptcy,
insolvency or other relief for debtors; or shall seek or
consent to or acquiesce in the appointment of any trustee,
receiver or liquidator of such entity or of all or any
part of its property, or of any or all of the royalties,
revenues, rents, issues or profits thereof, or shall make
any general assignment for the benefit of creditors, or
shall admit in writing its inability to pay its debts or
shall generally not pay its debts as they become due; or
(2) A court of competent jurisdiction shall enter
an order, judgment or decree approving a petition filed
against the Borrower or any Subsidiary seeking any
reorganization, dissolution or similar relief under any
present or future federal, state or other statute, law or
regulation relating to bankruptcy, insolvency or other
relief for debtors, and such order, judgment or decree
shall remain unvacated and unstayed for an aggregate of
thirty (30) days (whether or not consecutive) from the
first date of entry thereof; or any trustee, receiver or
liquidator of the Borrower or any Subsidiary or of all or
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any part of its property, or of any or all of the
royalties, revenues, rents, issues or profits thereof,
shall be appointed without the consent or acquiescence of
such entity and such appointments shall remain unvacated
and unstayed for an aggregate of thirty (30) days (whether
or not consecutive); or
(3) A writ of execution or attachment or any
similar process shall be issued or levied against all or
any part of or interest in the Collateral, or any judgment
involving monetary damages shall be entered against the
Borrower or any Subsidiary which shall become a lien on
the Collateral or any portion thereof or interest therein
and such execution, attachment or similar process or
judgment is not released, bonded, satisfied, vacated or
stayed within thirty (30) days after its entry or levy.
(i) Any event of default shall occur under any Operative Document.
(j) A change shall occur after November 8, 1993, directly or
indirectly, in the ownership or control of the Borrower; provided, however,
that changes in the ownership or control of, or new issuances of, voting
common stock which do not exceed, cumulatively, 50% of the total issued and
outstanding shares of the Borrower as of September 30, 1993 shall not be
deemed an Event of Default under this Section 6.1(j); provided further,
that acquisitions of additional shares by members of the existing executive
management group of the Borrower shall not be counted as changes in the
ownership or control of the Borrower under this Section 6.1(j). For
purposes of computing the total issued and outstanding shares as of
September 30, 1993, warrants and options for such shares shall be included.
(k) An Event of Default shall occur under any Existing
Term Note or the Related Loan Agreement and the expiration of any
applicable cure period thereunder.
(l) The Borrower shall be obligated to prepay all or any
portion of its subordinated debt as a result of a Change of Control.
(m) The Borrower pays, or is determined to be obligated to
pay, any indemnity to Broadcast Partners under the Purchase Agreement in
excess of $1,000,000 in the aggregate.
6.2 Remedies. If an Event of Default occurs and is continuing, up-
on the election of the Lenders holding two-thirds of the then outstanding
aggregate Total Indebtedness of the Borrower to the Lenders (including under the
Revolving Credit Notes, the Existing Term Notes, the Related Bank Debt, the
Acquisition Notes, and any similar indebtedness), the entire unpaid principal
amount under the Notes, together with interest accrued thereon, shall become
immediately due and payable without presentment, demand, protest or notice of
any kind, all of which are hereby expressly waived, and the Lenders may exercise
their rights
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under the other Operative Documents, the Notes, the Term Agreement, and the
Related Loan Agreement (and the operative documents with respect thereto),
including, without limitation, under the Security Agreement. For purposes of
this Article VI, the term Lenders includes Boatmen's. In addition, the Lenders
shall have such other remedies as are available at law and in equity. Remedies
under this Agreement, the Operative Documents, the Notes, the Term Agreement,
the Related Loan Agreements (and the operative documents with respect thereto)
are cumulative. Any waiver must be in writing by the Lenders and no waiver shall
constitute a waiver as to any other occurrence which constitutes an Event of
Default or as to any party not specifically included in such written waiver.
VII. INTER-CREDITOR AGREEMENTS
7.1 FNB-O as Servicer. FNB-O will act as sole servicer of the
loans evidenced by the Notes (other than in connection with interest rate
protection contracts). For purposes of this Article VII, the term Lenders
includes Boatmen's and the term Event of Default means any Event of Default
hereunder, under any Note, or under the Term Agreement or the Related Loan
Agreement. FNB-O will enforce, administer and otherwise deal with the loans made
by the Lenders in accordance with safe and prudent banking standards employed by
FNB-O in the case of the loan made by FNB-O. Without limiting the generality of
the foregoing, FNB-O will, on its own behalf and on behalf of the Lenders: (i)
maintain originals of the Operative Documents (excluding the Notes) and the
operative documents in connection with the Term Agreement and the Related Loan
Agreement; (ii) receive requests for Advances from the Borrower, promptly
transmit the same to the Revolving Lenders and make such Advances on behalf of
the Revolving Lenders (provided that FNB-O is assured of reimbursement therefor
by the other Revolving Lenders for their pro rata shares); (iii) receive
payments and prepayments from the Borrower and apply such payments as provided
in Section 7.2; (iv) receive notices from the Borrower and send copies thereof
to the Lenders if FNB-O has reasonable cause to believe that such Lenders have
not received such notice from another source; and (v) advise the Lenders of the
occurrence of any Event of Default which FNB-O obtains actual knowledge of. The
Lenders agree not to attempt to take any action against the Borrower under the
Operative Documents, the Notes, the Term Agreement or the Related Bank Debt or
with respect to the indebtedness evidenced thereby without FNB-O's consent
unless holders of two-thirds of the then outstanding aggregate Total
Indebtedness of the Borrower to the Lenders (including under the Notes and any
similar indebtedness) shall have requested FNB-O to take specific action against
the Borrower and FNB-O shall have failed to do so within a reasonable period
after receipt of such request. All actions, consents, waivers and approvals by
the Lenders shall be deemed taken or given and amendments hereto deemed agreed
to if the holders of more than two-thirds of the outstanding aggregate Total
Indebtedness of the Borrower to the Lenders shall have indicated their consent
thereto. Notwithstanding the foregoing, unanimous approval of the applicable
Lenders under the respective Notes shall be required for: (i) any reduction or
compromise of the principal loan amount of such Notes, the amount or rate of
interest accrued or accruing thereon or the fees due hereunder; and (ii)
extension of the date of any scheduled payment; and unanimous consent of all the
Lenders shall be required for (iii) permitting the sale of or releasing the
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security interest of the Lenders in Collateral which comprises more than ten
percent (10%) of net book value of fixed assets of the Borrower; and (iv) any
amendment of Sections 7.1 or 7.2 hereof. A Revolving Lender's commitment
hereunder may not be increased without the consent of such Revolving Lender, it
being understood, however, that increases in the total revolving credit facility
hereunder may be made with the consent of the holders of more than two-thirds of
the outstanding aggregate total outstanding obligation of the Borrower to the
Revolving Lenders, so long as such increase does not result in the increase of
any non-consenting Revolving Lender's commitment hereunder.
7.2 Application of Payments. Until the earlier of the occurrence
of an Event of Default or any Lender's giving of notice to the others that it
deems itself insecure, payments or prepayments made by the Borrower may be
applied to the indebtedness designated by the Borrower or otherwise applied as
follows:
(a) first, to pay interest to date on the Revolving
Credit Notes and fees due to the Lenders;
(b) second, to make payments due but unpaid under any
of the other Notes; and
(c) third, pro rata to the Lenders, such pro rata share to
be determined as set forth below in subsection (bb) of this Section 7.2.
After the occurrence of an Event of Default or any Lender's giving of notice
that it deems itself insecure, payments or prepayments on the Notes received by
FNB-O or any of the Lenders and funds realized upon the disposition of any of
the Collateral shall be applied as follows:
(aa) first, to reimburse FNB-O for any costs, expenses,
and disbursements (including attorneys' fees) which may be incurred or made
by FNB-0: (i) in connection with its servicing obligations; (ii) in the
process of collecting such payments or funds; or (iii) as advances made by
FNB-O to protect the Collateral (provided, however, that FNB-O shall have
no obligation to make such protective advances); and
(bb) second, pari passu among the Lenders, based on their
respective pro rata shares of the funds to be applied. Each Lender's pro
rata share shall be equal to a fraction, (x) the numerator of which shall
be the total principal loan amount then outstanding which is owing to each
such Lender under its Notes, and (y) the denominator of which shall be the
total principal loan amount then outstanding which is owing to the Lenders
under all Notes. As to any Note which represents an obligation of the
Borrower to one or more Lenders under an interest rate protection contract,
"principal loan amount then outstanding" shall mean, as of the date of
determination by FNB-O of the Lenders' respective pro rata shares, the
amount, if any, of the unpaid Interest Rate Protection Contract Amounts.
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Except as specifically provided in this Section 7.2, FNB-O shall have no
obligation to repay or prepay any amount due from the Borrower to any of the
other Lenders nor shall FNB-O have any obligation to purchase all or a part of
any Note hereunder or any Advance made by any Lenders, nor shall the Lenders
have any recourse whatsoever against FNB-O with respect to any failure of the
Borrower to repay the indebtedness referenced herein.
7.3 Liability of FNB-O. FNB-O shall not be liable to the Lenders
for any error of judgment or for any action taken or omitted to be taken by it
hereunder, except for gross negligence or willful misconduct. Without limiting
the generality of the foregoing, FNB-O, except as expressly set forth herein,
(a) may consult with legal counsel, independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (b) makes no representation or warranty with respect to,
and shall not be responsible for, the accuracy, completeness, execution,
legality, validity, legal effect or enforceability of this 1997 Revolving Credit
Agreement, the Notes, or the other Operative Documents or the operative
documents under the Term Agreement or the Related Bank Debt, or the value or
sufficiency of any Collateral given by the Borrower or the priority of the
Lenders' security interest therein or the financial condition of the Borrower;
and (c) shall not be responsible for the performance or observance of any of the
terms, covenants or conditions of the Operative Documents, the Existing Term
Notes, or the operative documents under any Related Bank Debt on the part of the
Borrower and shall not have any duty to inspect the property (including, without
limitation, the books and records) of the Borrower.
7.4 Transfers. No Lender shall subdivide, transfer or grant a
participation in its respective Notes or in any Advance hereunder without the
prior written consent of FNB-O which consent shall not be unreasonably withheld.
For purposes of this Section 7.4, "Notes" shall not include interest rate
protection contracts.
7.5 Reliance. The Lenders acknowledge that they have been advised
that none of the Notes nor any interest therein or related thereto has been (i)
registered under the Securities Act of 1933, as amended, nor (ii) insured by the
Federal Deposit Insurance Corporation. The Lenders acknowledge that they have
received from the Borrower all financial information and other data relevant to
their decision to extend credit to the Borrower and that they have independently
approved the credit quality of the Borrower.
7.6 Relationship of Lenders. The Lenders intend for the
relationships created by this Agreement to be construed as concurrent direct
loans from each Lender respectively to the Borrower. Nothing herein shall be
construed as a loan from any Lender to FNB-O or as creating a partnership or
joint venture relationship among them.
7.7 New Lenders. In the event that new Lenders are added to this
Agreement, the Term Agreement or the Related Loan Agreement, such Lenders shall
be required to agree to the inter-creditor provisions of this Article VII.
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VIII. MISCELLANEOUS
8.1 Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and may not be effectively amended, changed, modified or altered, except in
writing executed by all parties.
8.2 Governing Law. The Operative Documents shall be governed
by and construed pursuant to the laws of the State of Nebraska.
8.3 Notices. Until changed by written notice from one party hereto
to the other, all communications under the Operative Documents shall be in
writing and shall be hand delivered or mailed by registered mail to the parties
as follows:
If to the Borrower:
DATA TRANSMISSION NETWORK CORPORATION
Suite 200
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
If to the Lenders:
FIRST NATIONAL BANK OF OMAHA
One First National Center
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Notices shall be deemed given when mailed, except that any notice by the
Borrower under Sections 2.4 and 2.5 shall not be deemed given until received
by FNB-O.
8.4 Headings. The captions and headings herein are for convenience
only and in no way define, limit or describe the scope or intent of any
provisions or sections of this Agreement.
8.5 Counterparts. This Agreement may be executed in several
counterparts and such counterparts together shall constitute one and the same
instrument.
8.6 Survival; Successors and Assigns. The covenants, agreements,
representations and warranties made herein, and in the certificates delivered
pursuant hereto, shall survive the execution and delivery to the Lenders of this
Agreement and shall continue in full force and effect so long as any Note or any
obligation to the Lenders under any of the Operative Documents is outstanding
and unpaid. Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and assigns of such
party, and all covenants, promises and agreements by or on behalf of the
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Borrower which are contained in this Agreement shall bind the successors and
assigns of the Borrower and shall inure to the benefit of the successors and
assigns of the Lenders.
8.7 Severability. If any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity without invalidating
the remainder of such provision or the remaining provisions of this Agreement.
8.8 Assignment. The Borrower may not assign its rights
or obligations hereunder and any assignment in contravention of the terms
hereof shall be void.
8.9 Amendments. Any amendment, modification or supplement
to this Agreement must be in writing and must be signed by the requisite parties
hereto.
8.10 Consent to Form of Security Agreement, Term Agreement.
The parties hereto expressly approve the form of the Term Agreement and the
Security Agreement, both amended and restated as of the date hereof.
IN WITNESS WHEREOF, the Borrower, Boatmen's and the Revolving
Lenders have caused this 1997 Revolving Credit Agreement to be executed by their
duly authorized corporate officers as of the day and year first above written.
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DATA TRANSMISSION NETWORK
CORPORATION
By
--------------------------------------------
Title:
35
- 122 -
FIRST NATIONAL BANK OF OMAHA
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
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THE SUMITOMO BANK, LIMITED
By
--------------------------------------------
Title:
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
---------
Borrower
37
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FIRST NATIONAL BANK, WAHOO,
NEBRASKA
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
▇▇▇▇▇▇▇▇
▇▇
- ▇▇▇ -
▇▇▇ ▇▇▇▇
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
39
- 126 -
NORWEST BANK NEBRASKA, N.A.
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
40
- 127 -
LASALLE NATIONAL BANK, a national
banking association
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
41
- 128 -
MERCANTILE BANK OF
ST. LOUIS, N.A.
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
---------
Borrower
42
- 129 -
FIRST BANK, NATIONAL
ASSOCIATION
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
43
- 130 -
THE BOATMEN'S NATIONAL BANK
OF ST. LOUIS
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
44
- 131 -
BANK OF MONTREAL, a Canadian bank
By
--------------------------------------------
Title:
NOTICE: A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any misunderstandings or disappointments, any
contract, promise, undertaking, or offer to forebear repayment of money or to
make any other financial accommodation in connection with this loan of money or
grant or extension of credit, or any amendment of, cancellation of, waiver of,
or substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.
INITIALED:
--------
Borrower
45
- 132 -
EXHIBIT A
TO 1997 REVOLVING CREDIT AGREEMENT
among
DATA TRANSMISSION NETWORK,
FIRST NATIONAL BANK OF OMAHA,
FIRST NATIONAL BANK, WAHOO, NEBRASKA,
NBD BANK,
NORWEST BANK NEBRASKA, N.A.,
THE SUMITOMO BANK, LIMITED,
MERCANTILE BANK OF ST. LOUIS, N.A.,
FIRST BANK, NATIONAL ASSOCIATION,
BANK OF MONTREAL
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS,
AND
LASALLE NATIONAL BANK
FORM OF NOTES
46
- 133 -
SECURED BUSINESS PROMISSORY NOTE
Omaha, Nebraska $
-----------------------------
, 19 June 30, 1998
---------------------- ---- ------------------
(Note Date) (Maturity Date)
REVOLVING NOTE TERMS
On or before June 30, 1998, DATA TRANSMISSION NETWORK CORPORATION
("Maker") promises to pay to the order of [REVOLVING LENDER] ("Lender") the
principal sum hereof, which shall be the lesser of
Dollars, or so much thereof as may have been advanced by Lender, either directly
under this Note or as an advance pursuant to the 1997 Revolving Credit Agreement
dated as of February 26, 1997, as amended from time to time (the "Agreement")
among Maker and Lender, First National Bank of Omaha, First National Bank,
Wahoo, Nebraska, NBD Bank, Norwest Bank Nebraska, N.A., LaSalle National Bank,
The Sumitomo Bank, Limited, Mercantile Bank of St. Louis, N.A., Bank of
Montreal, First Bank, National Association, and Boatmen's Bank of St. Louis,
N.A. (collectively, the "Lenders"). All capitalized terms not defined herein
shall have their respective meanings as set forth in the Agreement.
Interest shall accrue on the principal sum hereof from and including
the Note Date above to the earlier of the Maturity Date or the date of
Conversion (as such term is defined hereafter) at a variable rate, which shall
fluctuate on a monthly basis, equal to the rate announced from time to time by
FNB-O as its "National Base Rate" minus a margin as determined below. The margin
shall be adjusted quarterly after receipt of Maker's Quarterly Compliance
Certificate (as defined in the Agreement), commencing with the Quarterly
Compliance Certificate for the quarter ended December 31, 1996. Adjustments
shall be retroactive to the beginning of the current quarter.
(a) If the Quarterly Compliance Certificate shows that, as of
the end of the prior quarter, the Leverage Ratio was greater than 42,
the margin for the current quarter (meaning the quarter in which the
certificate is required to be delivered) shall be .25%.
(b) If the Quarterly Compliance Certificate shows that, as of
the end of the prior quarter, the Leverage Ratio was greater than 36
but equal to or less than 42, the margin for the current quarter shall
be .50%.
(c) If the Quarterly Compliance Certificate shows that, as of
the end of the prior quarter, the Leverage Ratio was greater than 30
but equal to or less than 36, the margin for the current quarter shall
be .75%.
47
- 134 -
(d) If the Quarterly Compliance Certificate shows that, as of
the end of the prior quarter, the Leverage Ratio was greater than 24
but equal to or less than 30, the margin for the current quarter shall
be 1.00%.
(e) If the Quarterly Compliance Certificate shows that, as of
the end of the prior quarter, the Leverage Ratio was greater than 18
but equal to or less than 24, the margin for the current quarter shall
be 1.25%.
(f) If the Quarterly Compliance Certificate shows that, as of
the end of the prior quarter, the Leverage Ratio was equal to or less
than 18, the margin for the current quarter shall be 1.375%.
The Base Rate minus the applicable margin as determined above is hereinafter
referred to as the "Revolving Credit Rate." Changes in the Base Rate shall be
effective on the first day of each month, based on the Base Rate in effect as of
such day. Interest shall be due upon the rendering of each monthly invoice
therefor by FNB-O.
TERM NOTE TERMS
Upon the earlier of: (i) June 30, 1998; or (ii) Maker's giving notice
of its election to convert the revolving credit loan evidenced by this Note, or
any portion thereof, to a term loan, the revolving loan referenced above (or
applicable portion thereof) shall be deemed converted to a term loan (the
"Conversion"). Any such term loan shall be evidenced by notes (the "Converted
Notes") separate from the initial Revolving Credit Notes. Upon the issuance of
Converted Notes, the Revolving Credit Facility shall be reduced by the principal
amount of such Converted Notes (and shall be increased to the extent permitted
in Section 2.1(b) of the Agreement) and no further Advances shall be made by the
Revolving Lenders on the converted amount. The then outstanding principal
hereunder shall become due and payable in forty-eight equal installments of
principal, with the first such installment due on the last day of the month
following Conversion, or, if such day is not a Business Day, on the next
succeeding Business Day, subsequent installments due on the last day of each
consecutive month thereafter. In any event, the total amount of all unpaid
principal and accrued interest hereunder shall be due and payable no later than
June 30, 2002.
After Conversion, interest shall accrue on the principal outstanding
from time to time at a variable rate, which shall fluctuate on a monthly basis,
which is equal to the Revolving Credit Rate plus .25%. For purposes of computing
such variable rate, changes in the Base Rate shall be effective on the first day
of each month based on the Base Rate in effect on such day. Notwithstanding
anything in the foregoing to the contrary, after Conversion, Maker may elect to
have a fixed interest rate apply to the outstanding Principal Loan Amount
converted and outstanding after the date of giving notice of such fixed rate
election (the "Fixed Rate Notice"). Such fixed rate shall be equal to the
greater of:
48
- 135 -
(a) the Revolving Credit Rate in effect on the date of the
notice, plus .50%, or
(b) the average of the yields on constant maturity Treasury
Bonds with maturities of three years and five years, as quoted
in the immediately preceding monthly Federal Reserve
Statistical Release (the "Release") plus the following
incremental percentage determined based upon the Leverage
Ratio as of the last day of the preceding month: (x) if the
Leverage Ratio is greater than 36, the incremental percentage
shall be 2.25%; (y) if the Leverage Ratio is greater than 24
but not in excess of 36, the incremental percentage shall be
2.00%; and (z) if the Leverage Ratio is 24 or less, the
incremental percentage should be 1.75%;
Any election of a fixed rate by Maker shall be final and irrevocable.
Interest shall be due each month concurrently with the Maker's principal
payment. Notwithstanding anything to the contrary elsewhere herein, after an
Event of Default has occurred interest shall accrue on the entire outstanding
balance of principal and interest at a fluctuating rate equal to the Default
Rate. Interest shall be calculated on the basis of the actual number of days
outstanding and a 360-day year. Interest shall continue to accrue on the full
unpaid balance hereunder notwithstanding any permitted or unpermitted failure of
Maker to make a scheduled payment or the fact that a scheduled payment day falls
on a day other than a Business Day. If Maker's most recent Quarterly Compliance
Certificate shows that, as of the end of the prior quarter, Total Indebtedness
was in excess of thirty-six (36) times the Operating Cash Flow at the end of
such quarter, the current quarter shall be deemed a "Restricted Quarter." If,
any time during a Restricted Quarter (including, without limitation, during any
period in such quarter prior to delivery of the Quarterly Compliance
Certificate), the interest rate accruing on any Existing Term Note (as defined
in the Agreement) or Converted Note is less than 7.50% per annum, a "Trigger
Event" shall be deemed to have occurred. Upon the occurrence of a Trigger Event,
Maker shall be obligated to pay the following fees: (i) .375% of the outstanding
principal balance as of the date preceding the Trigger Event of each Existing
Term Note or Converted Note which accrues interest at less than seven and
one-half percent (7.50%) per annum which amount shall be payable promptly upon
invoicing by FNB-O; (ii) the same amount as computed in clause (i), payable on
the six-month anniversary of the Trigger Event; and (iii) the same amount as
computed in clause (i), payable on the twelve-month anniversary of the Trigger
Event.
Maker may at any time prepay in whole or in part the Principal Loan
Amount outstanding under this Revolving Credit Note or a Converted Note if the
Maker has given the Revolving Lenders at least two (2) business days prior
written notice of its intention to make such prepayment. Any such prepayment may
be made without penalty except for a Converted Note as to which interest is
accrued at a fixed rate in accordance with clause (a) or (b) above, in which
event a prepayment penalty shall be due to the Lender, at Lender's option,
either: (1) the Make-Whole Premium due in respect of such prepayment; or (2) the
applicable prepayment fee as set forth below. The applicable prepayment fee for
any Converted Note shall be: (i) if the notice electing fixed interest was given
49
- 136 -
within twelve (12) months of Conversion, the fee shall be 1.50% of the amount of
such prepayment; (ii) if the notice electing fixed interest was given after
twelve (12) months of Conversion, but within twenty-four (24) months of
Conversion, the fee shall be .75% of the amount of such prepayment; and (iii) if
the notice electing fixed interest was given after twenty- four (24) months of
Conversion, but within thirty-six (36) months of Conversion, the fee shall be
.30% of the amount of such prepayment.
GENERAL TERMS
Payment of this Note and the performance of Maker's obligations under
the Agreement ("Obligations") are secured by a security interest granted to
First National Bank of Omaha, as agent for the Lenders and others ("Agent"),
under the Security Agreement in:
All of Maker's accounts, accounts receivable, chattel paper, documents,
instruments, goods, inventory, equipment, general intangibles, contract
rights, all rights of Maker in deposits and advance payments made to
Maker by its customers and Subscribers, accounts due from advertisers
and all ownership, proprietary, copyright, trade secret and other
intellectual property rights in and to computer software (and
specifically including, without limitation, all such rights in DTN
transmission computer software used in the provision of the Basic DTN
Subscription Service and Farm Dayta Service to Maker's Subscribers) and
all documentation, source code, information and works of authorship
pertaining thereto, all now owned or hereafter acquired and all
proceeds and products thereof; and such additional collateral as is
more specifically described in the Security agreement.
Maker's liability under its Obligations shall not be affected by any of
the following:
Acceptance or retention by Lender or Agent of other property
or interests as security for the Obligations, or for the liability of
any person other than a Maker with respect to the Obligations;
The release of all or any of the Collateral or other
security for any of the Obligations to any Maker;
Any release, extension, renewal, modification or compromise
of any of the Obligations or the liability of any obligor thereon; or
Failure by Lender or Agent to resort to other security or any
person liable for any of the Obligations before resorting to the
Collateral.
50
- 137 -
Neither Lender nor Agent is required to take any action whatsoever in
respect of the Collateral. Impairment or destruction of the Collateral shall not
release Maker of its liability hereunder.
Maker represents, warrants and covenants as follows:
Maker is authorized to grant to Agent a security interest in
the Collateral;
This Note, the Agreement and the Security Agreement have been
duly authorized, executed and delivered by the Maker and constitute
legal, valid and binding obligations of Maker;
This Note evidences a loan for business or agricultural pur-
poses; and
Maker agrees to pay all costs of collection in connection with
this Note, the Agreement and the Security Agreement, including
reasonable attorneys' fees and legal expenses.
Upon the failure of Maker to make any payment of principal or interest
when due hereunder or the occurrence of any Event of Default, all of the
Obligations shall, at the option of Agent and without notice or demand, mature
and become immediately due and payable; and Agent shall have all rights and
remedies for default provided by the Uniform Commercial Code, any other
applicable law and/or the Obligations.
All costs and expenses incurred by Lender or Agent in enforcing its
rights under this Note or any mortgage, endorsement, surety agreement, guaranty
relating thereto are the obligation of Maker and are immediately due and
payable. Interest shall accrue on such costs and expenses from the date of
incurrence at the rate specified herein for delinquent Note payments. Each
Maker, endorser, surety and guarantor hereby waives presentment, protest,
demand, notice of dishonor, and the defense of any statute of limitations.
Without affecting the liability of any Maker, endorser, surety or
guarantor, the holder or Agent may, without notice, renew or extend the time for
payment, accept partial payments, release or impair any Collateral or other
security for the payment of this Note or agree to ▇▇▇ any party liable on it.
Neither Lender nor Agent shall be deemed to have waived any of its
rights upon or under this Note, or under any mortgage, endorsement, surety
agreement or guaranty, unless such waivers be in writing and signed by Lender or
Agent, as the case may be. No delay or omission on the part of Lender or Agent
in exercising any right shall operate as a waiver of such right or any other
right. A waiver on any one occasion shall not be construed as a bar to or waiver
of any right on any future occasion. All rights and remedies of Lender or Agent
on liabilities or the Collateral, whether evidenced hereby or by any other
instrument or papers, shall be cumulative and may be exercised singularly or
concurrently.
51
- 138 -
Maker, if more than one, shall be jointly and severally liable
hereunder and all provisions hereof regarding the liabilities or security of
Maker shall apply to any liability or any security of any or all of them. This
Note shall be binding upon the heirs, executors, administrators, assigns or
successors of Maker; shall constitute a continuing agreement, applying to all
future as well as existing transactions, whether or not of the character
contemplated at the date of this Note, and if all transactions between Lender
and Maker shall be at any time closed, shall be equally applicable to any new
transactions thereafter, provided that Lender's interest in the Collateral shall
be limited to the extent provided in the Security Agreement; shall benefit
Lender, its successors and assigns; and shall so continue in force
notwithstanding any change in any partnership party hereto, whether such change
occurs through death, retirement or otherwise.
All obligations of Maker hereunder shall be payable in immediately
available funds in lawful money of the United States of America at the principal
office of First National Bank of Omaha in Omaha, Nebraska or at such other
address as may be designated by Bank in writing.
This Note shall be construed according to the laws of the State of
Nebraska.
Unless the content otherwise requires, all terms used herein which are
defined in the Uniform Commercial Code shall have the meanings therein stated.
Any provision of this Note which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
This Note is given in substitution of that certain Secured Business
Promissory Note dated , the original principal amount of
$ . This Note shall not affect, and there remains outstanding from
the Maker to the Lender the Related Bank Debt (as such term is defined in the
Agreement) and those certain Secured Business Promissory Notes dated as of April
16, 1993, July 8, 1993, August 30, 1994, November 29, 1994 and February 27,
1995, and all extensions, renewals, and substitutions of or for the foregoing.
Executed as of this day of , .
DATA TRANSMISSION NETWORK
CORPORATION
By:
--------------------------------
Title:
52
- 139 -
PROMISSORY NOTE SCHEDULE
Loan Advances and Payments of Principal
DATA TRANSMISSION NETWORK CORPORATION
REVOLVING NOTE ADVANCES AND PAYMENTS:
Amount of Unpaid
Amount Principal Paid Amount of Principal Notation
Date of Advance or Prepaid Interest Paid Balance Made By
---- ---------- --------------- ------------- --------- ---------
53
- 140 -
TERM NOTE:
Date of Conversion:
--------------------------------------
Amount Due at Date of Conversion:
------------------------
Fixed Rate Notice Date: Fixed Rate: %
------------------- -----------
Amount of Unpaid
Amount Principal Paid Amount of Principal Notation
Date of Advance or Prepaid Interest Paid Balance Made By
---- ---------- --------------- ------------- --------- ---------
54
- 141 -
EXHIBIT B
TO 1997 REVOLVING CREDIT AGREEMENT
among
DATA TRANSMISSION NETWORK,
FIRST NATIONAL BANK OF OMAHA,
FIRST NATIONAL BANK, WAHOO, NEBRASKA,
NBD BANK,
NORWEST BANK NEBRASKA, N.A.,
THE SUMITOMO BANK, LIMITED,
MERCANTILE BANK OF ST. LOUIS, N.A.,
FIRST BANK, NATIONAL ASSOCIATION,
BANK OF MONTREAL,
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS,
AND
LASALLE NATIONAL BANK,
DRAWING CERTIFICATE
55
- 142 -
DRAWING CERTIFICATE
DATA TRANSMISSION NETWORK CORPORATION
To induce the First National Bank of Omaha, First National Bank, Wahoo,
Nebraska, NBD Bank, Norwest Bank Nebraska, N.A., LaSalle National Bank, The
Sumitomo Bank, Limited, Mercantile Bank of St. Louis, N.A., First Bank, National
Association, and Bank of Montreal (the "Revolving Lenders") to make an advance
under the 1997 Revolving Credit Agreement (the "Agreement") dated as of February
26, 1997, between the undersigned (the "Borrower"), The Boatmen's National Bank
of St. Louis ("Boatmen's"), and the Revolving Lenders (as to Boatmen's and the
Revolving Lenders together, (the "Banks"), the Borrower hereby certifies to the
Banks that its Operating Cash Flow (as defined in the Agreement) as represented
below is true and correct and that there is no default under the aforementioned
Agreement, or on any other liability of the Borrower to the Banks.
All information as of: Date
-------------------------
a) Maximum Revolving Credit Facility $
--------
b) Principal on Converted Notes,
Acquisition Notes, Existing Term Notes,
and Related Bank Debt Outstanding $
--------
c) Principal on Revolving Credit $
--------
d) ADVANCE REQUEST $
--------
e) Total Proposed Bank Debt
(line b + line c + line d, but $
not to exceed line a) --------
f) Most recent month's operating cash flow $
--------
g) Prior month's operating cash flow $
--------
h) Operating Cash Flow
(average of line f and line g) $
--------
i) 36 x Operating Cash Flow $
--------
j) Excess (line i - line e) $
--------
Name of Borrower: Data Transmission Network Corporation
Signature:
----------------------------------------------
Title:
----------------------------------------------
56
- 143 -
EXHIBIT C
TO 1997 REVOLVING CREDIT AGREEMENT
among
DATA TRANSMISSION NETWORK,
FIRST NATIONAL BANK OF OMAHA,
FIRST NATIONAL BANK, WAHOO, NEBRASKA,
NBD BANK,
NORWEST BANK NEBRASKA, N.A.,
THE SUMITOMO BANK, LIMITED,
MERCANTILE BANK OF ST. LOUIS, N.A.,
FIRST BANK, NATIONAL ASSOCIATION,
BANK OF MONTREAL,
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS,
AND
LASALLE NATIONAL BANK
OFFICER'S CERTIFICATE
57
- 144 -
COMPLIANCE CERTIFICATE
DATA TRANSMISSION NETWORK CORPORATION
First National Bank of Omaha Date
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ & ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
I certify that Data Transmission Network Corporation is in compliance with the
requirements set forth in the 1997 Revolving Credit Agreement (the "Agreement")
dated as of February 26, 1997, between First National Bank of Omaha, First
National Bank, Wahoo, Nebraska, NBD Bank, Norwest Bank Nebraska, N.A., LaSalle
National Bank, The Sumitomo Bank, Limited, Mercantile Bank of St. Louis, N.A.,
First Bank, National Association, The Boatmen's National Bank of St. Louis and
Data Transmission Network Corporation.
The following calculations are as of (statement date) as required by
-----------
Section 4.1(d) of said Agreement:
Evaluations:
Total Indebtedness (TI):
Operating Cash Flow: most recent month previous month
ending ending
---------- -----------
Net Income (loss) -------------- ---------------
Interest Expense -------------- ---------------
Depreciation -------------- ---------------
Amortization -------------- ---------------
Deferred Income
Taxes -------------- ---------------
Non-Ordinary
Non-Cash
Charges (Credits) -------------- ---------------
Total a) -------------- b) ---------------
Operating Cash Flow = OCF = (a+b)/2 =
------------------
Leverage Ratio (TI/OCF):
Section 2.3
. Pricing: If the Leverage Ratio is greater than 42 then the
margin is .25%.
If the Leverage Ratio is greater than 36 but equal
to or less than 42 then the margin is .50%. If the
Leverage Ratio is greater than 30 but equal to or
less than 36 then the margin is .75%.
58
- 145 -
If the Leverage Ratio is greater than 24 but equal
to or less than 30 then the margin is 1.00%.
If the Leverage Ratio is greater than 18 but equal
to or less than 24 then the margin is 1.25%. If
the Leverage Ratio is equal to or less than 18
then the margin is 1.375%.
Position: The Revolving Credit Rate is the Base Rate minus
-------------
Section 2.5
. Trigger Fee: If Total Indebtedness is more than 36 times
Operating Cash Flow, then a one time fee, paid in
three installments of 3/8% of the then outstanding
principal balances, on any of the Existing Term
Notes, Acquisition Notes or Converted Notes which
have an interest rate less than 7.5% per annum is
due.
Position: A Trigger Event has/has not occurred.
Section 4.3
. Net Worth: A minimum Net Worth (exclusive of subordinated
debt) of $23,500,000 plus fifty percent (50%) of
the net income (but not losses) of the Borrower
for each fiscal year, commencing with the fiscal
year beginning January 1, 1997; provided, however,
solely for purposes of determining compliance with
the provisions of this Section 5.3, "Net Worth"
shall not include any subordinated debt.
Minimum Net Worth (exclusive of subordinated
debt)= $ 23,500,000.
Net Income Year ending Addition (50%)
$ 12/31/97 $
------------ ------------
Total Minimum Net
Worth $
============
Position:
Total Net Worth (exclusive of subordinated debt) = $
--------------
Section 4.4
. Indebtedness: At no time will Total Indebtedness exceed 48x OCF.
Position: (48 x OCF) - Total Indebtedness =
59
- 146 -
. Total At no time will Adjusted Total Indebtedness
Indebtedness exceed 60 x OCF
plus
subordinated
debt plus
guaranty
contingencies
(Adjusted
Total
Indebtedness or
ATI):
Position: Adjusted Total Indebtedness = $
-------------
(60 x OCF) - (ATI) = $
-----------------
Section 4.7
. Distributions: Neither the Borrower nor any Subsidiary shall
declare any dividends (other than dividends
payable in stock of the Borrower or dividends or
distributions from any consolidated Subsidiary) or
make any cash distribution in respect of any
shares of its capital stock or warrants of its
capital stock, without the prior written consent
of the Lenders; provided that the Borrower need
not obtain the Lenders' consent with respect to
dividends in any one (1) year which are in the
aggregate less than 25% of the Borrower's Net
Operating Profit After Taxes in the previous four
(4) quarters, as reported to the Lenders pursuant
to Section 4.1
. Position: Net Operating Profit
After Taxes for
last four (4) quarters =
-----------
x .25
Available for dividends
or distributions in the most
recent quarter plus the
prior three (3) quarters =
--------------
Dividends and distributions
(excluding dividends payable
solely in stock of the Borrower
and distributions from consolidated
Subsidiaries) declared or paid
in the most recent quarter plus the
prior three (3) quarters =
--------------
The Borrower [is/is not] in compliance with
Section 4.7.
60
- 147 -
Section 4.15
. Interest The ratio of OCF to Interest Expense ("IE")
Coverage: at the end of each quarter will not be less than
2.25 to 1.0 (225%).
Position: OCF = $
--------------
IE = $
--------------
OCF/IE = %
-------
Section 4.19
. Capital Expenditures: The Borrower shall not make
capital expenditures (other than permitted earning
assets specified in Section 4.19) in any fiscal
year, commencing with the fiscal year beginning
January 1, 1997, in excess of $1,000,000.
Position: Capital Expenditures (other than permitted
earning assets specified in Section 4.19) this
fiscal year = $
--------------
The Borrower [is/is not] in compliance with Section 4.19.
Section 4.20
. Acquisitions The Borrower shall not make acquisitions
which in the aggregate exceed $6,000,000 except
certain permitted unlimited acquisitions.
Position: Acquisitions (other than permitted unlimited
acquisitions) in the aggregate since the date of
the Agreement = .
----------
Date Amount Acquired Company
---- ------ ----------------
Permitted Unlimited Acquisition:
Principal Line
Acquired Place of Of
Date Amount Company Business Business
---- ------ -------- --------- --------
The Borrower [is/is not] in compliance with Section 4.20.
Additional Representations:
There have/have not been any sale(s) of assets which would require
prepayment of the Notes under Section 4.2.
61
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There has/has not been:
(i) a Change of Control or a material adverse change in
management personnel as defined in Section 4.14 of the
Agreement; or
(ii) a default under Section 6.1(j) or 6.1(l) regarding a
change in ownership or control of the Company.
(iii) an indemnity claim by Broadcast Partners under Section
6.1(m).
Name of Borrower: Data Transmission Network Corporation
Signature:
-------------------------------------
Title:
-------------------------------------
62
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SCHEDULE A
TO 1997 TERM CREDIT AGREEMENT
among
DATA TRANSMISSION NETWORK CORPORATION,
FIRST NATIONAL BANK OF OMAHA,
FIRST NATIONAL BANK, WAHOO, NEBRASKA,
NBD BANK,
NORWEST BANK NEBRASKA, N.A.,
THE SUMITOMO BANK, LIMITED,
MERCANTILE BANK OF ST. LOUIS, N.A.,
FIRST BANK, NATIONAL ASSOCIATION,
BANK OF MONTREAL
and
LASALLE NATIONAL BANK
PERMITTED ENCUMBRANCES
Secured Party Financing Statements
Nebraska Secretary of State
---------------------------
First National Bank of Omaha 12/28/87 #401690
10/13/92 #564918 Amendment
11/13/92 #568176 Continued
First National Bank of Omaha, as agent 5/8/96 #691938 Amendment
FirsTier, Lincoln 6/24/87 #384782
First National Bank of Omaha 2/03/88 #405477 Amendment
First National Bank, Wahoo 5/28/92 #553205 Continued
NBD, Detroit 10/13/92 #564919 Amendment
2/05/93 #576038 Amendment
11/10/93 #603168 Amendment
First National Bank of Omaha, as agent 5/8/96 #691936 Amendment
FirsTier, Lincoln 2/10/88 #406144
First National Bank of Omaha 10/13/92 #564917 Amendment
First National Bank, Wahoo 1/07/93 #572981 Continued
NBD, Detroit 2/05/93 #576039 Amendment
11/10/93 #603169 Amendment
First National Bank of Omaha, as agent 5/8/96 #691937 Amendment
63
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First Bank of Minneapolis 11/25/91 #534665
(Norstan) 8/24/92 #561090 Assignment
▇▇▇▇▇▇▇ County Clerk, Nebraska
------------------------------
FirsTier, Lincoln 2/11/88 #000534
First National Bank of Omaha 10/15/92 #000534 Amendment
First National Bank, Wahoo 1/08/93 #0000054 Continued
NBD, Detroit 2/05/93 #000253 Amendment
11/17/93 #54 Amendment
First National Bank of Omaha, as agent 5/ /96 Amendment
Iowa Secretary of State
-----------------------
FirsTier, Lincoln 2/10/88 H842023
First National Bank of Omaha 10/15/92 K395184 Amendment
First National Bank, Wahoo 1/08/93 K424887 Continued
NBD, Detroit 2/08/93 K434908 Amendment
11/15/93 K503145 Amendment
First National Bank of Omaha, as agent 5/6/96 K734148 Amendment
Kansas Secretary of State
-------------------------
FirsTier, Lincoln 2/10/88 #1286572
First National Bank of Omaha 10/15/92 #1842986 Amendment
First National Bank, Wahoo 1/08/93 #1868482 Continued
NBD, Detroit 2/11/93 #1879069 Amendment
11/12/93 #1964342 Amendment
First National Bank of Omaha, as agent 7/18/96 #2265201 Amendment
Illinois Secretary of State
---------------------------
FirsTier, Lincoln 3/18/88 #2402370
First National Bank of Omaha 10/21/92 #3043202 Amendment
First National Bank, Wahoo 2/11/93 #3084199 Amendment
NBD, Detroit 2/25/93 #3089132 Continued
12/09/93 #3197498 Amendment
First National Bank of Omaha, as agent 7/9/96 #3562627 Amendment
64
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Michigan Secretary of State
---------------------------
FirsTier, Lincoln 2/12/88 #C034473
First National Bank of Omaha 10/16/92 #C646856 Amendment
First National Bank, Wahoo 1/08/93 #C672590 Continued
NBD, Detroit 3/01/93 #C689434 Amendment
11/15/93 #C778208 Amendment
First National Bank of Omaha, as agent 7/8/96 #D128002 Amendment
Wisconsin Secretary of State
----------------------------
FirsTier, Lincoln 2/18/88 #968701
First National Bank of Omaha 10/21/92 #1309942 Amendment
First National Bank, Wahoo 01/15/93 #1326550 Continued
NBD, Detroit 2/08/93 #1331412 Amendment
11/23/93 #1393268 Amendment
First National Bank of Omaha, as agent 7/23/96 #1602740 Amendment
Indiana Secretary of State
--------------------------
FirsTier, Lincoln 2/11/88 #1454192
First National Bank of Omaha 10/21/92 #1808780 Amendment
First National Bank, Wahoo 1/11/93 #1822115 Continued
NBD, Detroit 2/08/93 #1827451 Amendment
11/12/93 #1878806 Amendment
First National Bank of Omaha, as agent 7/9/96 #2065412 Amendment
Minnesota Secretary of State
----------------------------
FirsTier, Lincoln 2/17/88 1#121648#00
First National Bank of Omaha 10/16/92 #1537269 Amendment
First National Bank, Wahoo 01/19/93 #1557397 Continued
NBD, Detroit 2/08/93 #1562125 Amendment
11/23/93 #1632156 Amendment
First National Bank of Omaha, as agent 9/5/96 #1875684 Amendment
South Dakota Secretary of State
-------------------------------
FirsTier, Lincoln 2/10/88 880410802864
First National Bank of Omaha 10/16/92 #22901003596 Amend.
First National Bank, Wahoo 1/08/93 #30081001734 Cont.
NBD, Detroit 2/09/93 #30391203308 Amend.
11/22/93 #33261003899 Amend.
First National Bank of Omaha, as agent 7/8/96 #961900902562 Amend.
65
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Missouri Secretary of State
---------------------------
FirsTier, Lincoln 2/11/88 #1555991
First National Bank of Omaha 10/16/92 #2184193 Amendment
First National Bank, Wahoo 1/08/93 #2212473 Continued
NBD, Detroit 2/08/93 #2224113 Amendment
11/15/93 #2331876 Amendment
First National Bank of Omaha, as agent 7/8/96 #2684601 Amendment
Ohio Secretary of State
-----------------------
FirsTier, Lincoln 2/12/88 #Y00095612
First National Bank of Omaha 10/19/92 #01097336 Amendment
First National Bank, Wahoo 1/11/93 #01119343901 Cont.
NBD, Detroit 2/09/93 #02099338901 Amend.
11/12/93 #▇▇▇▇▇▇▇▇▇▇ Amendment
First National Bank of Omaha, as agent 7/9/96 #07099607117 Amendment
Kentucky Secretary of State
---------------------------
First National Bank of Omaha 11/12/93 134318
First National Bank of Omaha, as agent 7/23/96 Amendment
Pennsylvania Department of State
--------------------------------
First National Bank of Omaha 11/12/93 22571277
First National Bank of Omaha, as agent 7/8/96 25631529 Amendment
Oklahoma Secretary of State
---------------------------
First National Bank of Omaha 11/12/93 059782
First National Bank of Omaha, as agent 7/8/96 035257 Amendment
Mississippi Secretary of State
------------------------------
First National Bank of Omaha 11/12/93 0756092--
First National Bank of Omaha, as agent 7/8/96 01015782 Amendment
Colorado Secretary of State
---------------------------
First National Bank of Omaha 11/12/93 932082461
First National Bank of Omaha, as agent 7/8/96 962051575 Amendment
66
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California Secretary of State
-----------------------------
First National Bank of Omaha 11/12/93 93229491
First National Bank of Omaha, as agent 7/5/96 96191C0067 Amendment
Washington Secretary of State
-----------------------------
First National Bank of Omaha 11/15/93 933190075
First National Bank of Omaha, as agent 7/5/96 96-187-9060 Amendment
Montana Secretary of State
--------------------------
First National Bank of Omaha 11/15/93 419540
First National Bank of Omaha, as agent 7/8/96 419540 Amendment
Arizona Secretary of State
---------------------------
First National Bank of Omaha 11/15/93 765359
First National Bank of Omaha, as agent 7/8/96 765359 Amendment
North Carolina Secretary of State
---------------------------------
First National Bank of Omaha 11/15/93 050742
First National Bank of Omaha, as agent 7/8/96 1357308 Amendment
North Dakota Secretary of State
-------------------------------
First National Bank of Omaha 11/16/93 93-380331
First National Bank of Omaha, as agent 7/8/96 96-608985 Amendment
Florida Secretary of State
---------------------------
First National Bank of Omaha 11/17/93 930000236992
First National Bank of Omaha, as agent 7/10/96 960000142090 Amendment
Texas Secretary of State
------------------------
First National Bank of Omaha 11/29/93 227591--
First National Bank of Omaha, as agent 7/8/96 96683548 Amendment
67
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Alabama Secretary of State
--------------------------
First National Bank of Omaha, as agent 6/27/95 B-95-26462FS
7/19/96 95-26462 Amendment
Arkansas Secretary of State
---------------------------
First National Bank of Omaha, as agent 6/29/95 968722
7/10/96 968722 Amendment
New York Secretary of State
---------------------------
First National Bank of Omaha, as agent 6/26/95 130246
7/8/96 532973 Amendment
68
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