EXHIBIT 4.4
CREDIT AGREEMENT
dated as of May 11, 2001
between
EMPIRE ONE TELECOMMUNICATIONS, INC. as
Debtor and Debtor in Possession
and
EOT LENDING CORP.
as
Lender
TABLE OF CONTENTS
Page
ARTICLE 1DEFINITIONS 1
ARTICLE 2THE CREDITS 5
Section 2.1 The Commitment 5
Section 2.2 Borrowings 5
Section 2.3 Changes of Commitment 6
Section 2.4 Fees 6
Section 2.5 Use of Proceeds 6
Section 2.6 Note 6
Section 2.7 Optional Prepayments 6
Section 2.8 Mandatory Prepayments and Reductions of
Commitment 7
ARTICLE 3PAYMENTS OF PRINCIPAL AND INTEREST 7
Section 3.1 Amortization 7
Interest 7
ARTICLE 4PAYMENTS; COMPUTATIONS; ETC. 7
Section 4.1 Payments 7
Section 4.2 Computations 8
Section 4.3 Minimum Amounts 8
Section 4.4 Certain Notices 8
ARTICLE 5SECURITY: ADMINISTRATION PRIORITY 9
Section 5.1 Grant of Lien and Security Interest 9
Section 5.2 Administrative Priority 9
Section 5.3 Grants, Rights and Remedies Cumulative 10
Section 5.4 No Filings Required 10
Section 5.5 Survival 10
ARTICLE 6CONDITIONS PRECEDENT 12
Section 6.1 Conditions Precedent 12
Section 6.2 Certification 13
ARTICLE 7REPRESENTATIONS AND WARRANTIES 14
Section 7.1 Incorporation, Good Standing and Due
Qualification 14
Section 7.2 Corporate Power and Authority; No Conflicts 14
Section 7.3 Legally Enforceable Agreements 15
Section 7.4 Litigation 15
Section 7.5 Subsidiaries 15
Section 7.6 No Default on Outstanding Judgments or
Orders 15
Section 7.7 Government Regulation 15
Section 7.8 Administrative Priority 15
Section 7.9 Bankruptcy Court Orders 16
ARTICLE 8AFFIRMATIVE COVENANTS 16
Section 8.1 Maintenance of Existence 16
Section 8.2 Conduct of Business 16
Section 8.3 Maintenance of Properties and Executory
Contracts and Leases 17
Section 8.4 Maintenance of Records 17
Section 8.5 Compliance with Laws 17
Section 8.6 Right of Inspection 17
Section 8.7 Further Assurances 17
ARTICLE 9NEGATIVE COVENANTS 18
Section 9.1 Liens 18
Section 9.2 Bankruptcy Court Orders; Administrative
Priority; Lien Priority; Payment of Claims 19
ARTICLE 10EVENTS OF DEFAULT 20
Section 10.1 Events of Default 20
Section 10.2 Consequences of an Event of Default 22
Section 10.3 Certain Remedies 22
ARTICLE 11MISCELLANEOUS 23
Section 11.1 Amendments and Waivers 23
Section 11.2 Binding Effect 23
Section 11.3 The Lender as Party-in-Interest 24
Section 11.4 Assignment and Participation 24
Section 11.5 Notices 24
Section 11.6 Table of Contents; Headings 25
Section 11.7 Severability 25
Section 11.8 Counterparts 25
Section 11.9 Integration 25
Section 11.10 Governing Law 25
Section 11.11 Waiver of Jury Trial 25
EXHIBITS
Exhibit A - Note
Exhibit B - Security and Pledge Agreement
Exhibit C - Budget
Exhibit D - Final Order
SCHEDULES
Schedule I - Subsidiaries
Schedule II - Licenses and Consents
Schedule III - Litigation
Schedule IV - Liens
CREDIT AGREEMENT dated as of___________, 2001 by and
between Empire One Telecommunications, Inc. as debtor and debtor
in possession (the "Borrower"), and EOT Lending Corp., (the
"Lender").
The Borrower filed voluntary petitions for relief
under chapter 11 of title 11 of the United States Code on
April 2, 2001 (the "Petition Date"). The Borrower has requested
the Lender to provide it with a $600,000 working capital loan
facility and, subject to the terms and conditions set forth
herein, the Lender has agreed to provide such facility.
NOW THEREFORE, the parties hereto hereby agree,
effective upon the Effective Date (as hereinafter defined), as
follows:
ARTICLE 1
DEFINITIONS
Definitions. As used in this Agreement the following
terms have the following meanings (terms defined in the singular
to have a correlative meaning when used in the plural and vice
versa):
"Agreement" means this Credit Agreement, as amended or
supplemented from time to time. References to Articles,
Sections, Exhibits, Schedules and the like refer to the
Articles, Sections, Exhibits, Schedules and the like of this
Agreement unless otherwise indicated.
"Avoidance Actions" means all claims, actions, causes
of action arising under Sections
542,544,545,547,548,549,550,551, 553(b), or 724(a) of the
Bankruptcy Code.
"Banking Day" means any day other than a day on which
commercial banks are not authorized or required to close in New
York City.
"Bankruptcy Code" shall mean title 11 of the United
States Code, as amended.
"Bankruptcy Court" shall mean the United States
Bankruptcy Court for the Southern District of New York or such
other court having original jurisdiction over the Chapter 11
Case.
"Borrower" shall have the meaning assigned to such
term in the preamble hereto.
"Borrowing" means a borrowing hereunder of a Loan.
"Budget" shall mean the budget for the Borrower
attached hereto as Exhibit C for the period commencing on or
about the Effective Date and ending on or about the Final
Termination Date, as the same may be amended, modified or
supplemented from time to time with the Lender's consent.
"Carve-Out Expenses" shall mean (i) amounts payable
pursuant to 28 U.S.C. s 1930(a)(6) and (ii) allowed fees and
expenses of professionals retained in the Chapter 11 Case
pursuant to ss 327 and 1103 of the Bankruptcy Code up to, but
not exceeding $300,000 in the aggregate (inclusive of any
holdbacks, but excluding any unused retainers established prior
to the date hereof); provided, that such amounts shall not be
used for investigating or attacking Lender, its claims or
interests, or the Loans.
"Chapter 11 Case" shall mean the Borrower's cases
under chapter 11 of the Bankruptcy Code pending in the
Bankruptcy Court.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time.
"Collateral" shall have the meaning assigned to such
term in the Security and Pledge Agreement but shall not include
Avoidance Actions.
"Committee" shall mean the Official Committee of
Unsecured Creditors appointed in the Borrower's Chapter 11 case.
"Commitment" shall mean the obligation of the Lender
to make Loans to the Borrower in an aggregate principal amount
not to exceed $600,000.
"Controlled Group" shall mean all members of a
controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which,
together with the Borrower, are treated as a single employer
under Section 414(b) or 414(c) of the Code.
"Default" means any event which with the giving of
notice or lapse of time, or both, would become an Event of
Default.
"Dollars" and the sign "$" mean lawful money of the
United States of America.
"Effective Date" shall have the meaning attributed
thereto in Section 6.1 hereof.
"Event of Default" has the meaning given such term in
Section 10.1 hereof.
"Facility Documents" means this Agreement, the Note
and the Security Documents.
"Final Order" shall mean an order of the Bankruptcy
Court, in form and substance satisfactory to the Lender and its
counsel, finally approving this Agreement and the extensions of
credit made and to be made to the Borrower in accordance with
this Agreement in substantially in the form of Exhibit D hereto,
as the same may be amended, modified or supplemented from time
to time with the express written joinder or consent of the
Lender.
"Final Termination Date" shall mean the earlier of
(a) the date the last outstanding Borrowing shall be due and
payable, and (b) the occurrence of an Event of Default.
"Foreign Collateral" shall have the meaning attributed
thereto in Section 5.5(c) hereof.
"Interim Order" shall mean an order of the Bankruptcy
Court, in form and substance satisfactory to the Lender and its
counsel, approving this Agreement and all or a portion of the
extension of credit to be made by the Lender in accordance with
this Agreement on an interim basis, and finding, among other
things, that the applicable Loans are in good faith and
otherwise satisfy s 364(e) of the Bankruptcy Code as the same
may be amended, modified or supplemented from time to time with
the express written joinder or consent of the Lender.
"Lender" shall have the meaning assigned to such term
in the preamble hereto.
"Lien" means any lien (statutory or otherwise),
security interest, mortgage, deed of trust, priority, pledge,
charge, conditional sale, title retention agreement, financing
lease or other encumbrance or similar right of others, or any
agreement to give any of the foregoing.
"Loans" shall mean the Loans provided for in
Section 2.1(a) hereof.
"Note" shall mean shall mean the promissory grid note
provided for by Section 2.6 hereof and all promissory notes
delivered in substitution or exchange therefor, in each case, as
the same shall be modified and supplemented and in effect from
time to time.
"Obligations" shall mean all indebtedness, obligations
and liabilities of the Borrower to the Lender incurred under or
related to this Agreement, the Note or any other Facility
Document, whether such indebtedness, obligations or liabilities
are direct or indirect, secured or unsecured, joint or several,
absolute or contingent, due or to become due, whether for
payment or performance, now existing or hereafter arising,
including the principal amount of Loans outstanding, together
with interest thereon, and all expenses, fees and indemnities
hereunder or under any other Facility Document, from time to
time arising under or in connection with or evidenced or secured
by this Agreement, the Note, or any other Facility Document.
"Permitted Liens" shall mean the Liens described in
clause (b) of Section 9.2 hereof.
"Person" means an individual, partnership,
corporation, limited liability company, business trust, joint
stock company, trust, unincorporated association, joint venture,
governmental authority or entity of whatever nature.
"Petition Date" shall have the meaning assigned to
such term in the preamble hereto.
"Placement Fee" shall mean a fee of three percent (3%)
of the amount of each Borrowing, payable to the Lender in cash
on the date of each Borrowing.
"Plan of Reorganization" shall mean any chapter 11
plan for the Borrower.
"Post-Default Rate" shall mean, in respect of any
principal of any Obligation or any other amount under this
Agreement or any Note that is not paid when due (whether at
stated maturity; by acceleration, by optional or mandatory
prepayment or otherwise), at a rate per annum during the period
from and including the due date to but excluding the date on
which such amount is paid in full equal to 16%.
"Security and Pledge Agreement" shall mean a Security
and Pledge Agreement executed by the Borrower in favor of the
Lender, substantially in the form of Exhibit B hereto and
covering the collateral identified therein, as the same shall be
amended modified and supplemented and in effect from time to
time.
"Security Documents" shall mean, collectively, the
Security and Pledge Agreement, all Uniform Commercial Code
financing statements required by this Agreement or the Security
and Pledge Agreement which have been or will be filed with
respect to the security interests in personal property and
fixtures created pursuant thereto, and all additional Security
and Pledge Agreements, mortgages or Uniform Commercial Code
financing statements heretofore or hereafter delivered or filed,
as the case may be, by the Borrower pursuant to the terms of
this Agreement or the Security and Pledge Agreement.
"Subsidiary" means, as to any Person, any corporation
or other entity of which at least a majority of the securities
or other ownership interests having ordinary voting power
(absolutely or contingently) for the election of directors or
other persons performing similar functions at the time owned
directly or indirectly by such Person.
"Termination Date" shall mean, with respect to each
Borrowing, the earlier of (a) twelve months from the date of
each Borrowing, and (b) the occurrence of an Event of Default.
ARTICLE 2
THE CREDITS
Section 2.1 The Commitment.
(1) Subject to the terms and conditions set
forth herein, the Lender agrees to make one or more multiple
draw Loans to the Borrower from time to time during in an
aggregate principal amount not to exceed the Commitment. Loans
once repaid or prepaid may not be reborrowed.
(2) Notwithstanding anything herein to the
contrary, the Lender shall have no obligation to make Loans
hereunder in excess of the amounts authorized in the Chapter 11
Case and any reference herein to the amount of any Commitment
shall be automatically reduced to the amounts so authorized.
Section 2.2 Borrowings. The Borrower shall give
the Lender notice of each Borrowing of Loans hereunder as
provided in Section 4.4 hereof. On the date specified for each
Borrowing hereunder, the Lender shall, subject to the terms and
conditions of this Agreement make available the amount of such
Borrowing to the Borrower by depositing the same, in immediately
available funds, in an account of the Borrower designated for
such purpose from time to time by the Borrower.
Section 2.3 Changes of Commitment.
(1) The Commitment shall be automatically
reduced to zero on the Commitment Termination Date.
(2) The Borrower shall have the right at any
time or from time to time (i) so long as no Loans are
outstanding, to terminate the Commitment and (ii) to reduce the
unused amount of the Commitment; provided that (x) the Borrower
shall give notice of each such termination or reduction as
provided in Section 4.4 hereof and (y) each partial reduction
shall be in an amount at least equal to $50,000 or in multiples
of $10,000 in excess thereof.
(3) The Commitment once terminated or reduced
may not be reinstated.
Section 2.4 Fees. Lender has agreed to provide
working capital Loans under the terms of this Agreement for the
Borrower's ordinary course operations. The Borrower has agreed
to the Placement Fee in consideration of Lender's agreement to
enter into this Agreement. Therefore, in full satisfaction of
any and all fees, including any commitment fee, facility fee or
termination fee, in connection with the Loans, the Borrower
shall be obligated to pay Lender the Placement Fee.
Section 2.5 Use of Proceeds. The Borrower hereby
covenants, represents and warrants that the proceeds of the
Loans made to it will be used solely to fund the Borrower's
continued ordinary course operations, and working capital needs,
in each case solely in accordance with the Budget.
Section 2.6 Note. The Loans made by the Lender
hereunder shall be evidenced by a single promissory note of the
Borrower in substantially the form of Exhibit A hereto, dated as
of the date hereof, payable to the Lender in a principal amount
equal to the amount of the Commitment as originally in effect
and otherwise duly completed. The date and amount of each Loan
made by the Lender to the Borrower, and all payments and
prepayments made on account of the principal thereof, shall be
recorded by the Lender on its books and, prior to any transfer
of the Note, endorsed by the Lender on the schedule attached to
such Note or any continuation thereof; provided, however, that
any failure by the Lender to make any such notation shall not
affect the obligations of the Borrower hereunder or under such
Note in respect of such obligations.
Section 2.7 Optional Prepayments. Subject to
Section 4.3 hereof, the Borrower shall have the right to prepay
the Obligations, at any time or from time to time, provided the
Borrower shall give the Lender notice of each such prepayment as
provided in Section 4.4 hereof.
Section 2.8 Mandatory Prepayments and Reductions of
Commitment. If at any time the Loans outstanding hereunder
exceed the Commitment then available, then the Borrower shall
immediately repay the Loans in the amount of such excess.
ARTICLE 3
PAYMENTS OF PRINCIPAL AND INTEREST
Section 3.1 Amortization.
(1) To the extent not due and payable earlier
pursuant to the terms of this Agreement, the entire unpaid
principal amount of each Borrowing shall be due and payable on
its Termination Date.
Section 3.2 Interest.
(a) The Borrower hereby promises to pay to the
Lender interest on the unpaid principal amount of each Loan, for
the period from and including the date of such Loan to but
excluding the date such Loan shall be paid in full at a rate per
annum equal to 12%.
(2) Notwithstanding the foregoing, the Borrower
hereby promises to pay to the Lender interest on the Loans at
the Post-Default Rate (i) upon the occurrence and during the
continuance of an Event of Default hereunder and (ii) on any
principal of any Loan and on any other amount payable by the
Borrower hereunder or under the Note which shall not be paid in
full when due (whether at stated maturity, by acceleration, by
mandatory prepayment or otherwise), for the period from and
including the due date thereof to but excluding the date the
same is paid in full.
(3) Accrued interest on the Loans shall be
payable at maturity.
(4) Notwithstanding anything herein to the
contrary, interest payable at the Post-Default Rate shall be
payable in cash from time to time on demand.
ARTICLE 4
PAYMENTS; COMPUTATIONS; ETC.
Section 4.1 Payments.
(1) Except to the extent otherwise provided
herein, all payments of principal, interest and other amounts to
be made by the Borrower to the Lender under this Agreement, the
Note and the other Facility Documents shall be made in Dollars,
in immediately available funds, without deduction, set-off or
counterclaim, into an account (Account No. ) maintained
in the name of the Lender at [name of bank], New York, New York
(or such other account designated by the Lender from time to
time) not later than 1:00 p.m. New York time on the date on
which such payment shall become due (each such payment made
after such time on such due date to be deemed, to have been made
on the next succeeding Banking Day).
(2) The Borrower shall, at the time of making
any payment or prepayment under this Agreement or any Note,
specify to the Lender the Obligations or other amounts payable
by the Borrower hereunder to which such payment is to be applied
(and in the event that the Borrower fails to so specify, or if
an Event of Default has occurred and is continuing, the Lender
may apply the amount of such payment received by it in such
manner as it may determine to be appropriate).
(3) If the due date of any payment under this
Agreement or any Note would otherwise fall on a day that is not
a Banking Day, such date shall be extended to the next
succeeding Banking Day, and interest shall be payable for any
principal so extended for the period of such extension.
Section 4.2 Computations. Interest hereunder shall
be computed on the basis of a year of 365 or 366 days, as the
case may be, and actual days elapsed (including the first day
but excluding the last day) occurring in the period for which
payable.
Section 4.3 Minimum Amounts. Each Borrowing
hereunder or optional partial prepayment of principal of the
Loan shall be in an amount at least equal to $50,000 or in
multiples of $10,000 in excess thereof.
Section 4.4 Certain Notices. Notices by the
Borrower to the Lender of terminations or reductions of the
Commitments, of Borrowings and of optional prepayments of the
Obligations shall be irrevocable and shall be effective only if
received by the Lender not later than 12:00 noon New York time
on the number of Banking Days prior to the date of the relevant
termination, reduction, borrowing or prepayment specified below:
Notice
Number of
Banking Days
Prior
Termination or
reduction of Commitment
2
Borrowing or repayment
of Loans
1
Each such notice of termination or reduction shall specify the
amount and type of the Commitment to be terminated or reduced.
Each notice of optional prepayment shall specify the amount and
type of Loan to be prepaid, and each such notice of Borrowing
shall specify the type of Loan to be borrowed (subject to
Section 4.3 hereof) and the date of borrowing or optional
prepayment (which shall be a Banking Day).
ARTICLE 5
SECURITY: ADMINISTRATION PRIORITY
Section 5.1 Grant of Lien and Security Interest.
(1) Pursuant to this Agreement and the Security
Documents, the Borrower hereby assigns, pledges, transfers,
grants, confirms and sets over unto the Lender, and hereby
grants and creates in favor of the Lender a security interest in
and to, the Collateral other than Avoidance Actions.
(2) The liens and security interests in favor of
the Lender referred to in Section 5.1(a) hereof and under the
Security Documents shall be valid and perfected liens and
security interests, prior to all other liens and interests,
other than Permitted Liens, and shall have second priority, with
respect to Collateral, junior only to the Permitted Liens
thereon; provided that the liens and security interests in favor
of the Lender referred to in Section 5.1(a) hereof and under the
Security Documents shall be subject to the Carve-Out Expenses.
All liens and security interests in favor of the Lenders
hereunder and under the Security and Pledge Agreements and their
priority shall remain in effect until the Commitments have been
terminated and all Obligations have been repaid in cash in full.
Section 5.2 Administrative Priority. The Borrower
hereby agrees that the Obligations of the Borrower shall
constitute allowed administrative expenses in the Chapter 11
Case
having super-priority status under s 364(c)(1) of the Bankruptcy
Code over all other administrative expenses and unsecured claims
against the Borrower now existing or hereafter arising of any
kind or nature whatsoever, including without limitation all
administrative expenses, charges and claims of the kind
specified in ss 503(b), 506(c), 726 and 507(b) of the Bankruptcy
Code, subject, as to priority, only to Carve-Out Expenses;
provided, however, that the administrative priority accorded
Lender shall not extend to Avoidance Actions.
Section 5.3 Grants, Rights and Remedies Cumulative.
The liens and security interests granted pursuant to
Section 5.1(a) hereof and the Security Documents and the
administrative priority granted pursuant to Section 5.2 hereof,
may be independently granted by the Facility Documents, the
Interim Order, the Final Order and by other agreements hereafter
entered into. This Agreement, the other Facility Documents, the
Interim Order, the Final Order and such other agreements
hereinafter entered into supplement each other, and the grants,
priorities, rights and remedies of the Lender hereunder and
thereunder are cumulative.
Section 5.4 No Filings Required. The liens and
security interests referred to in Section 5.1(a) hereof, and in
the other Facility Documents shall be deemed valid and perfected
by Interim Order or the Final Order, as the case may be,
whichever occurs first. The Lender shall not be required to
file any financing statements, notices of lien, mortgages or
similar instruments in any jurisdiction or filing office, or to
take possession of any Collateral or to take any other action in
order to validate or perfect the Liens and security interests
granted by or pursuant to this Agreement, the Interim Order or
the Final Order, as the case may be, or any other Facility
Document. Lender shall, in its sole discretion, from time to
time choose to file such financing statements, notices of lien,
mortgages or similar instruments, take possession of any
Collateral, or take any other action to validate or perfect any
such security interests or liens, all such documents shall be
deemed to have been filed or recorded at the time and on the
date of entry of the Interim Order or, if no Interim Order is
obtained, the Final Order, and the Borrower consents to the
modification of the automatic stay under s 362 of the Bankruptcy
Code to permit the Lender to file such financing statements,
notices of lien or similar instruments, take possession of any
collateral, or take any other action to validate or perfect any
such security interests or liens.
Section 5.5 Survival. The Liens, security
interests, lien priorities, administrative priorities and other
rights and remedies granted to the Lender pursuant to this
Agreement and the other Facility Documents (specifically
including but not limited to the existence, perfection and
priority of the liens and security interests provided herein and
therein, and the administrative priority provided herein and
therein) shall not be modified, altered or impaired in any
manner by any other financing or extension of credit or
incurrence of debt by the Borrower (pursuant to s 364 of the
Bankruptcy Code or otherwise), or by any dismissal or conversion
of the Chapter 11 Case, or, with respect to any Loans then
outstanding, any modification, amendment or reversal or stay of
the Interim Order or the Final Order, as the case may be, or by
any other act or omission whatsoever. Without limitation,
notwithstanding any such order, financing, extension,
incurrence, dismissal, conversion, act of omission:
(a) except for the Carve-Out Expenses, no costs
or expenses of administration which have been or may be incurred
in the Chapter 11 Case or any conversion of the same or in any
other proceedings related thereto, and no priority claims, are
or will be prior to or on a parity with any claim of the Lender
against the Borrower in respect of any Obligation;
(b) the Liens and security interests in favor of
the Lender set forth in Section 5.1(a) hereof and in the
Facility Documents shall constitute valid and perfected first
priority Liens and security interests, subject only to the
Permitted Liens to which such Liens and security interests
hereunder shall be subordinate and junior, and shall be prior to
all other Liens and security interests, now existing or
hereafter arising, in favor of any other creditor to any other
Person whatsoever; provided that all such liens and security
interests of the Lender set forth in Section 5.1(a) hereof or in
any of the Facility Documents shall be subject to the Carve-Out
Expenses; and
(c) the Liens and security interests in favor of
the Lender set forth in Section 5.1(a) hereof and the Facility
Documents shall be valid and perfected without the necessity
that the Lender file financing statements, notices of lien,
mortgages or otherwise perfect its Liens and security interests
under applicable nonbankruptcy law except for such Collateral as
is or may be hereafter be located outside of the territorial
limits of the United States of America ("Foreign Collateral") to
the extent that the same may not be subject to the jurisdiction
of the Bankruptcy Court. The Borrower shall take all reasonable
steps required to perfect Lender's security interest in the
Foreign Collateral under applicable non-bankruptcy law as
promptly as practicable, but in no event later than thirty days
after the Effective Date; provided, however, that a failure to
do so shall not constitute an Event of Default hereunder.
ARTICLE 6
CONDITIONS PRECEDENT
Section 6.1 Conditions Precedent. The obligation
of the Lender to make Loans available hereunder shall occur on
the date (the "Effective Date") on or before July 1, 2001 that
the Lender shall have received each of the following, in form,
and substance satisfactory to the Lender and its counsel:
(a) the Note duly executed by the Borrower;
(b) the Security and Pledge Agreement duly
executed by the Borrower together with such financing
statements executed by the Borrower which in the opinion of
the Lender are desirable to perfect the liens and security
interest created hereby and by the Security and Pledge
Agreement;
(c) the stock certificates evidencing the
Pledged Interests, accompanied by undated stock powers duly
executed in blank;
(d) evidence that either the Interim Order or
the Final Order, as the case may be, shall have been
entered by the Bankruptcy Court approving the Commitment
(or such lesser amount as shall be acceptable to the Lender
in its sole discretion), and such order shall be in full
force and effect and shall not have been reversed, stayed,
modified or amended;
(e) a copy of the charter, as amended and in
effect, of the Borrower certified as of recent date by the
Secretary of State of the state of its incorporation, and a
certificate from such Secretary of State dated as of recent
date as to the good standing of and charter documents filed
by the Borrower;
(f) a certificate from the Secretary of the
Borrower, dated the Effective Date, certifying (a) that the
attached are true and complete copies of the by-laws of the
Borrower as amended and in effect, (b) that attached
thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors of the Borrower
authorizing execution, delivery and performance of this
Agreement and the other Facility Documents to which the
Borrower is a party and the extensions of credit hereunder,
and that such resolutions have not been modified, rescinded
or amended and are in full force and effect, (c) that the
charter of the Borrower has not been amended since the date
of the certification thereto furnished pursuant to clause
(e) above, and (d) as to the incumbency and specimen
signature of each officer of the Borrower executing the
Facility Documents;
(g) a certificate of another officer of the
Borrower as to the incumbency and specimen signature of the
Secretary of the Borrower;
(h) a certificate of a duly authorized officer
of the Borrower, dated the Effective Date, stating that (a)
the representations and warranties in Article 7 of this
Agreement and in the other Facility Documents are true and
correct on such date as though made on and as of such date,
(b) no event has occurred and is continuing which
constitutes a Default or an Event of Default hereunder and
(c) prior to the Effective Date no material adverse change
in the assets, business, operations or financial condition
of the Borrower has occurred or become known since the
Petition Date, except as disclosed in writing by the
Borrower to the Lender prior to the Effective Date;
(i) the Liens and security interests in favor of
the Lender granted pursuant hereto and the Security and
Pledge Agreement shall be valid and perfected first
priority Liens prior (except for Permitted Liens to which
such Liens and security interests are subordinate and
junior) to all other Liens in or on the Collateral intended
to be subject thereto, subject to the Carve-Out Expenses;
(j) evidence that all fees, retainers and
expenses required by this Agreement to be paid on or before
the Effective Date shall have been paid in full (or shall
have been authorized by the Interim Order, or the Final
Order, as the case may be);
(k) the Lender shall otherwise be satisfied in
all material respects (in its sole discretion) with the
results of its business, operational and legal due
diligence in respect of the Borrower; and
(l) such other approvals, opinions or documents
as the Lender may reasonably request.
Section 6.2 Certification. Each notice of a
Borrowing shall be accompanied by a certificate of a duly
authorized officer of the Borrower certifying that the
statements contained in Article VII are true and correct both on
the date of such notice and, unless the Borrower otherwise
notifies the Lender prior to such Borrowing, as of the date of
such Borrowing.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
The Borrower hereby represents and warrants that upon
the occurrence of the Effective Date:
Section 7.1 Incorporation, Good Standing and Due
Qualification. The Borrower and its Subsidiaries (a) are
corporations duly organized, validly existing and in good
standing under the laws or the jurisdiction of their
organization; (b) have the requisite corporate power and have
material governmental licenses, authorizations, consents and
approvals necessary to own their assets, except as disclosed in
Schedule II hereto, and carry on the business in which they are
now engaged or proposed to be engaged; and (c) are duly
qualified to do business in all jurisdictions in which the
nature of the business conducted by the Borrower and its
Subsidiaries makes such qualification necessary and to so
qualify would have a material adverse effect on their business,
financial condition or operations.
Section 7.2 Corporate Power and Authority; No
Conflicts. Subject to the Bankruptcy Court approval, the
execution, delivery and performance by the Borrower of the
Facility Documents, the grant by the Borrower and the perfection
of the security interests purported to be granted in favor of
the Lender hereunder and under the Security Documents, and the
exercise by the Lender of any rights and remedies hereunder or
under the other Facility Documents have been duly authorized by
all necessary corporate action and do not and will not:
(a) contravene any provision of its charter or bylaws;
(b) violate any provision of, or require any filing,
registration, consent or approval under, any law, rule,
regulation, order, writ, judgment, injunction, decree,
determination or award presently in effect having applicability
to the Borrower or any of its Subsidiaries or affiliates (other
than entry of the Interim Order or the Final Order, as the case
may be, and as otherwise provided under Section 10.3 hereof);
(c) result in a breach of or constitute a default or require any
consent under any indenture or loan or credit agreement or any
other agreement, lease, or instrument to which the Borrower is a
party or by which it or its properties may be bound or affected
which would not be cured by entry of the Interim Order or Final
Order; (d) result in, or require, the creation or imposition of
any Lien (other than as provided hereunder and under the
Security Documents), upon or with respect to any of the
properties now owned or hereafter acquired by the Borrowing; or
(e) cause the Borrower (or any Subsidiary or affiliate, as the
case may be, of the Borrower) to be in default under any such
law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award or any such indenture, agreement,
lease or instrument which would not be cured by entry of the
Interim Order and Final Order.
Section 7.3 Legally Enforceable Agreements.
Subject to Bankruptcy Court approval, each Facility Document is,
or when delivered under this Agreement will be, a legal, valid
and binding obligation of the Borrower enforceable against the
Borrower in accordance with its terms.
Section 7.4 Litigation. Other than the Chapter 11
Case and as set forth in Schedule III hereto, there are no
actions, suits or proceedings pending against the Borrower or
any of its Subsidiaries or any of their respective properties
before any court, governmental agency or arbitrator which may,
in any one case or in the aggregate, materially adversely affect
the financial condition, operations, properties or business of
the Borrower or any such Subsidiary or the ability of the
Borrower to perform its obligations under the Facility
Documents.
Section 7.5 Subsidiaries. Schedule I hereto is a
complete and correct description of the name, jurisdiction of
incorporation and ownership of the outstanding capital stock of
each Subsidiary of the Borrower as in existence on the date
hereof. All shares of such stock or other equity or ownership
interests owned by the Borrower or one or more of its
Subsidiaries, as indicated in such Schedule, are owned free and
clear of all liens, security interests and other charges and
encumbrances.
Section 7.6 No Default on Outstanding Judgments or
Orders. Neither the Borrower nor any of its Subsidiaries is in
default with respect to any judgment, writ, injunction, decree,
rule or regulation of any court, arbitrator or federal, state,
municipal or other governmental authority, commission, board,
bureau, agency or instrumentality, domestic or foreign, other
than as a result of the Chapter 11 Case.
Section 7.7 Government Regulation. Neither the
Borrower nor any of its Subsidiaries is subject to regulation
under the Public Utility Holding Company Act of 1935, the
Investment Company Act of 1940, the Federal Power Act or any
statute or regulation limiting its ability to incur indebtedness
for money borrowed as contemplated hereby.
Section 7.8 Administrative Priority.
(1) The obligations of the Borrower will
constitute allowed administrative expenses in the Chapter 11
Case having priority over all other administrative expenses and
unsecured claims against the Borrower, now existing or hereafter
arising, of any kind or nature whatsoever, including without
limitation all other administrative expenses, charges or claims
of the kind specified in Sections 503(b), 506(c), 507(b) and
723(b) of the Bankruptcy Code, subject, as to priority, only to
Carve-Out Expenses; provided, however, that the administrative
priority accorded to Lender shall not extend to Avoidance
Actions.
(2) The Obligations of the Borrower will be
secured by a valid and perfected first Lien on and security
interest in all of the Collateral, subject only to the Permitted
Liens to which such Liens and security interests shall be junior
to and subordinate, and subject further to the Carve-Out
Expenses.
Section 7.9 Bankruptcy Court Orders. The Interim
Order or the Final Order, as the case may be, is in full force
and effect, and has not been reversed, stayed, modified or
amended.
ARTICLE 8
AFFIRMATIVE COVENANTS
So long as any Note shall remain unpaid, the Borrower
shall:
Section 8.1 Maintenance of Existence. Preserve and
maintain, and cause each of its Subsidiaries to preserve and
maintain, its corporate existence and good standing in the
jurisdiction of its organization, and qualify and remain
qualified, and cause each of its Subsidiaries to qualify and
remain qualified, as a foreign corporation in each jurisdiction
in which such qualification is required.
Section 8.2 Conduct of Business. (1) Continue, and
cause each of its Subsidiaries to continue, to engage in an
efficient and economical manner in a business of the same
general type as conducted by it on the date of this Agreement,
(b) obtain, and cause each of its Subsidiaries to obtain, from
time to time all licenses, permits, authorizations or other
forms of permission which under federal, state and local laws
are necessary or advisable for operating and maintaining the
conduct of the business of the Borrower and its Subsidiaries
(including, without limitation, copyrights, trademarks, patents
and licenses to use tangible or intangible property and similar
rights) if the failure to so obtain or maintain any such
license, permit, authorization or other form of permission would
result in a material adverse change in the financial condition
of the Borrower and its Subsidiaries, and (c) use its best
efforts, and cause each of its Subsidiaries to use its best
efforts, to preserve and protect the value of the Collateral.
Section 8.3 Maintenance of Properties and Executory
Contracts and Leases. Maintain, keep and preserve, and cause
each of its Subsidiaries to maintain, keep and preserve, all of
its properties (tangible and intangible) including leased
property, necessary or useful in the proper conduct of its
business in good working order and condition, ordinary wear and
tear excepted, and shall use its best efforts to ensure that all
leases and executory contracts necessary or useful in the
Borrower's or any of such Subsidiaries' business or operations
remain in full force and effect (without prejudice, however, to
the Borrower's right to assume or reject such leases or
executory contracts under s 365 of the Bankruptcy Code), except
to the extent otherwise consented to by the Lender or to the
extent that failure to do so would not result in a material
adverse change in the financial condition of the Borrower and
its Subsidiaries.
Section 8.4 Maintenance of Records. Keep, and
cause each of its Subsidiaries to keep, adequate records and
books of account, in which complete entries will be made
reflecting all financial transactions of the Borrower and its
Subsidiaries.
Section 8.5 Compliance with Laws. Comply, and
cause each of its Subsidiaries to comply, in all respects with
all applicable laws, rules, regulations and orders, such
compliance to include, without limitation, paying before the
same become delinquent all taxes, assessments and governmental
charges imposed upon it or upon its property, subject to the
limitations and requirements of the Bankruptcy Code.
Section 8.6 Right of Inspection. At any reasonable
time and from time to time, permit the Lender or any agent or
representative thereof, to examine and make copies and abstracts
from the records and books of account of, and visit the
properties of, the Borrower and any of its Subsidiaries, and to
discuss the affairs, finances and accounts of the Borrower and
any such Subsidiary with any of their respective officers and
directors and the Borrower's independent accountants.
Section 8.7 Further Assurances. Execute,
acknowledge, deliver, record, file, register, perform and do any
and all such further acts, deeds, conveyances, Security and
Pledge Agreements, assignments, estoppel certificates, financing
statements, assurances and other instruments as the Lender may
reasonably request from time to time in order (a) to carry out
more effectively the purposes of this Agreement or any other
Facility Document, (b) to subject the Collateral to valid and
perfected first priority liens and security interests (subject,
as to priority, to the Permitted Liens and the Carve-Out
Expenses), (c) to perfect and maintain the validity,
effectiveness and priority of any of the Facility Documents and
the Liens and security interests intended to be created thereby,
and (d) to better assure, convey, grant, assign, transfer,
preserve, protect and confirm unto the Lender the rights granted
or now or hereafter intended to be granted to the Lender under
any Facility Document. The assurances contemplated by this
Section 8.7 shall be given under applicable nonbankruptcy law as
well as the Bankruptcy Code, it being the intention of the
parties that the Lender may request assurances under applicable
nonbankruptcy law, and such request shall be complied with (if
otherwise made in good faith by the Lender) whether or not the
Interim Order or the Final Order is in force and whether or not
dismissal of the Chapter 11 Case or any other action by the
Bankruptcy Court is imminent, likely or threatened.
ARTICLE 9
NEGATIVE COVENANTS
So long as any Note shall remain unpaid, the Borrower
shall not:
Section 9.1 Liens. Create, incur, assume or suffer
to exist, or permit any of its Subsidiaries to create, incur,
assume or suffer to exist, any Lien upon or with respect to any
of its properties, now owned or hereafter acquired, except:
(1) Liens provided for under the Security
Documents;
(2) Liens for taxes or assessments or other
government charges or levies if not yet due and payable if they
are being contested in good faith by appropriate proceedings and
for which appropriate reserves are maintained;
(3) Liens imposed by law, such as mechanic's,
materialmen's, landlord's, warehousemen's and carrier's Liens,
and other similar Liens, securing the obligations incurred in
the ordinary course of business which are not past due for more
than 30 days, or which are being contested in good faith by
appropriate proceedings and for which appropriate reserves have
been established;
(4) Liens under workmen's compensation,
unemployment insurance, social security or similar legislation;
(5) Liens, deposits or pledges or liens granted
to secure the Borrower's obligations under letters of credit
issued to secure the performance of bids, tenders, contracts
(other than contracts for the payment of money), leases
(permitted under the terms of this Agreement), public or
statutory obligations, surety, stay, appeal, indemnity,
performance or other similar bonds, or other similar obligations
arising in the ordinary course of business;
(6) judgment and other similar Liens arising in
connection with court proceedings; provided that the execution
or other enforcement of such Liens is effectively stayed and the
claims secured thereby are being actively contested in good
faith and by appropriate proceedings and for which appropriate
reserves have been established;
(g) Liens listed on Schedule IV hereto; and
(h) easements, rights-of-way, restrictions and
other similar encumbrances which, in the aggregate, do not
materially interfere with the occupation, use and enjoyment by
the Borrower or any such Subsidiary of the property or assets
encumbered thereby in the normal course of its business or
materially impair the value of the property subject thereto.
Section 9.2 Bankruptcy Court Orders; Administrative
Priority; Lien Priority; Payment of Claims.
(1) Seek, consent to or suffer to exist any
modification, stay, vacation or amendment of the Interim Order,
or the Final Order, as the case may be, except for modifications
and amendments agreed to by the Lender.
(2) Seek, consent to or suffer to exist a
priority for any administrative expense or unsecured claim
against the Borrower (now existing or hereafter arising of any
kind or nature whatsoever, including without limitation any
administrative expenses, charges or claims of the kind specified
in Sections 503(b), 506(c), 507(b) and 723(b) of the Bankruptcy
Code) equal or superior to the priority of the Lender in respect
of the Obligations, except for the Carve-Out Expenses.
(3) Suffer to exist any Lien on the Collateral
having a priority equal or superior to the Liens and security
interests in favor of the Lender in respect of the Obligations,
except for Permitted Liens, and subject to the Carve-Out
Expenses.
(4) Prior to the date on which the Obligations
have been paid in full in cash and the Commitments have been
terminated, pay any administrative expense claims except, so
long as no Default or Event of Default has occurred and is
continuing hereunder, the Borrower may pay (i) administrative
expense claims incurred in the ordinary course of the business
of the Borrower and (ii) amounts payable pursuant to 28 U.S.C. s
1930(a)(6) and the allowed fees and expenses of professionals
under ss 330 and 331 of the Bankruptcy Code not in excess of
$300,000 in the aggregate, inclusive of any holdbacks and
retainers, in each case, unless otherwise approved by the
Lender, strictly in accordance with the Budget.
ARTICLE 10
EVENTS OF DEFAULT
Section 10.1 Events of Default. Any of the
following events shall be an "Event of Default":
(1) the Borrower shall: (i) fail to pay the
principal of any Note as and when due and payable; or (ii) fail
to pay interest on the Notes or any fee or other amount due
hereunder as and when due and payable and such failure shall
continue unremedied for ten Banking Days; or
(2) any material representation or material
warranty made or deemed made by any Borrower in this Agreement
or in any other Facility Document to which it is a party or
which is contained in any certificate, document, opinion,
financial or other statement furnished at any time under or in
connection with any Facility Document shall prove to have been
incorrect in any material respect on or as of the date made or
deemed made and shall continue unremedied for five Banking Days
after notice thereof; or
(3) an order with respect to the Chapter 11 Case
shall be entered by the Bankruptcy Court, or the Borrower shall
file an application for an order with respect to the Chapter 11
Case (i) appointing a trustee in any such Chapter 11 Case or
(ii) appointing an examiner in the Chapter 11 Case with the
authority to perform the duties of a trustee (other than the
duties solely of an examiner) in respect of the estate of the
Borrower or the operation of the business of the Borrower; or
(4) an order with respect to the Chapter 11 Case
shall be entered by the Bankruptcy Court dismissing the Chapter
11 Case or converting the Chapter 11 Case to a chapter 7 case;
or
(5) an order shall be entered by the Bankruptcy
Court confirming a plan of reorganization in the Chapter 11
Case, or a plan of reorganization shall be filed, which does not
contain a provision for termination of the Commitments and
payment in full in cash of all Obligations of the Borrower
hereunder and under the other Facility Documents on or before
the effective date of such plan or which is not otherwise
satisfactory in all material respects to the Lender; or
(6) an order with respect to the Chapter 11 Case
shall be entered by the Bankruptcy Court without the express
prior written consent of the Lender (i) to revoke, reverse,
stay, modify, supplement or amend the Interim Order, or the
Final Order or any of the Facility Documents, (ii) approving the
incurrence by the Borrower of any debt not contemplated
hereunder, (iii) to permit any administrative expense or any
claim (now existing or hereafter arising, of any kind or nature
whatsoever) to have administrative priority equal or superior to
the priority of the Lender in respect of the Obligations, except
for Carve-Out Expenses, or (iv) to grant or permit the grant of
a Lien on the Collateral other than Permitted Liens; or
(7) an order shall be entered by the Bankruptcy
Court that is not stayed pending appeal granting relief from the
automatic stay to any creditor of the Borrower with respect to
any claim secured by any asset or assets of the Borrower having
book value equal to or exceeding $200,000 in the aggregate;
provided, however, that it shall not be an Event of Default if
relief from the automatic stay is lifted solely for the purpose
of allowing such creditor to determine the liquidated amount of
its claim against the Borrower or such claim is covered by
insurance; or
(8) an application for any of the orders
described in clauses (c), (d), (e), (f) or (g) above shall be
made (i) by a Person other than the Borrower and such
application is not contested by the Borrower or (ii) by the
Borrower; or
(9) any judgment or order shall be entered
against the Borrower or any of its Subsidiaries or any other
event shall occur or condition exist which does or could
reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), business, operation or
prospects of the Borrower or any of its Subsidiaries, and there
shall be a period of ten consecutive days during which a stay or
enforcement of such judgment or order shall not be in effect; or
(10) the Security Documents shall at any time
after their execution and delivery and for any reason cease:
(A) to create a valid and perfected security interest and Lien
in and to the property purported to be subject thereto having
the priority specified in the Security Documents; or (B) to be
in full force and effect or shall be declared null and void, or
the validity or enforceability thereof shall be contested by the
Borrower, or the Borrower shall deny it has any further
liability or obligation under any such agreement, or the
Borrower shall fail to perform any of its obligations thereunder
and such failure shall continue for five Banking Days after
notice thereof; or
(11) the Borrower shall: (i) fail to perform or
observe any other material term, material covenant or material
agreement on its part to be performed or observed in any
business Facility Document and such failure shall continue
unremedied for thirty Banking Days after notice thereof; or (ii)
fail to comply with any of the terms or provisions of the
Interim Order or the Final Order.
Section 10.2 Consequences of an Event of Default.
If an Event of Default shall occur and so long as it shall
continue or, the Lender may, by notice to the Borrower, declare
the Commitment terminated, whereupon the Commitments will
terminate immediately and any fees hereunder shall be
immediately due and payable without further order of or
application to the Bankruptcy Court, presentment, demand,
protest or further notice of any kind, all of which are hereby
expressly waived, and an action therefor shall immediately
accrue.
Section 10.3 Certain Remedies. If an Event of
Default has occurred and is continuing, the Lender may, on
fifteen Banking Days' prior written notice to the Borrower, the
Committee, and the Office of the United States Trustee, Southern
District of New York, (i) declare the unpaid principal amount of
the Notes, interest accrued thereon, and all other amounts owing
by the Borrower hereunder or under the Note to be immediately
due and payable without further order of or application to the
Bankruptcy Court, presentment, demand, protest or further notice
of any kind, all of which are hereby expressly waived, an action
therefor shall immediately accrue, and (ii) exercise all rights
and remedies which the Lender may have hereunder or under any
other Facility Document, the Interim Order, the Final Order or
at law (including but not limited to the Bankruptcy Code and the
Uniform Commercial Code) or in equity or otherwise, without
regard to the automatic stay provided for in s 362 of the
Bankruptcy Code with respect to the Borrower or any of its
property. Within such ten Banking Days, the Borrower or any
other party-in-interest may seek a hearing before the Bankruptcy
Court and the Lender shall refrain from enforcing any of its
remedies hereunder until the Bankruptcy Court has ruled in
respect thereof or an agreement has otherwise been reached.
Unless the Bankruptcy Court shall order that no Event of Default
has occurred or has granted other related relief, the automatic
stay under s 362 of the Bankruptcy Code shall be vacated with
respect to the Collateral, and the Lender shall be free to
exercise all of its rights with respect to the Collateral,
subject to the rights of the holders of Permitted Liens, without
further approval of the Bankruptcy Court. All proceeds in
respect thereof shall be applied by the Lender to reduce the
Obligations in the Lender's sole discretion, and the Borrower
shall remain liable for any deficiencies. With respect to any
lease or executory contract constituting part of the Collateral,
the Lender shall have the right to cause the Borrower to assume
and assign such lease or executory contract to the Lender or its
designee, although nothing herein shall be construed to limit
the rights of the counterparty to such lease or executory
contract to adequate assurance and cure payments under s 365 of
the Bankruptcy Code or to impose any obligation on the Lender to
make any such adequate assurance or cure payments. Any proceeds
received by the Borrower in connection with the assumption and
assignment of any executory contract or lease shall be proceeds
of the Collateral and immediately remitted to the Lender to
reduce the Obligations then outstanding. All such remedies
shall be cumulative and not exclusive. No failure on the part
of such Lender to exercise, and no delay in exercising, any
right hereunder shall operate as a waiver thereof or preclude
any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and
not exclusive of any remedies provided by law.
ARTICLE 11
MISCELLANEOUS
Section 11.1 Amendments and Waivers. The Borrower
and the Lender may from time to time enter into agreements
amending, modifying or supplementing this Agreement, the Notes
or any other Facility Documents, and the Lender may from time to
time grant waivers or consents to a departure from the due
performance of the obligations of the Borrower hereunder or
thereunder. Any such agreement, waiver or consent must be in
writing and shall be effective only to the extent specifically
set forth in such writing. In the case of any such waiver or
consent relating to any provision hereof, any Event of Default
so waived or consented to shall be deemed to be cured and not
continuing, but no such waiver or consent shall extend to any
other or subsequent Event of Default or impair any right
consequent thereto.
Section 11.2 Binding Effect. This Agreement shall
be binding upon and inure to the benefit of the Lender, the
Borrower and their respective successors and assigns (including,
except for the right to request Loans, any trustee or examiner
or other person with expanded powers succeeding to the rights of
the Borrower or pursuant to any conversion to a case under
chapter 7 of the Bankruptcy Code).
Section 11.3 The Lender as Party-in-Interest. The
Borrower hereby stipulates and agrees that the Lender is and
shall remain a party-in-interest in the Chapter 11 Case and
shall have the right to participate, object and be heard in any
motion or proceeding in connection therewith (including but not
limited to objections to use of proceeds of the Loans, to the
payment of professional fees and expenses or the amount thereof,
to sales or other transactions outside the ordinary course of
business or to assumption or rejection of any executory contract
or lease).
Section 11.4 Assignment and Participation. This
Agreement shall be binding upon, and shall inure to the benefit
of, the Borrower and the Lender and their respective successors
and assigns, except that the Borrower may not assign or transfer
its rights or obligations hereunder. The Lender may assign, or
sell participations in, all or any part of the Obligations
(including all or a portion of its Commitment) owing to the
Lender to another Lender or other entity, in which event (a) in
the case of an assignment, upon notice thereof by the Lender to
the Borrower, the assignee shall have, to the extent of such
assignment (unless otherwise provided therein), the same rights,
benefits and obligations as it would have if it were the Lender
hereunder; and (b) in the case of a participation, the
participant shall have no rights under the Facility Documents.
The agreement executed by the Lender in favor of the participant
shall not give the participant the right to require the Lender
to take or omit to take any action hereunder except action
directly relating to (i) the extension of a payment date with
respect to any portion of the principal of or interest on any
amount outstanding hereunder allocated to such participant, (ii)
the reduction of the principal amount outstanding hereunder or
(iii) the reduction of the rate of interest payable on such
amount or any amount of fees payable hereunder to a rate or
amount, as the case may be, below that which the participant is
entitled to receive under its agreement with the Lender. The
Lender may furnish any information concerning the Borrower in
the possession of the Lender from time to time to assignees and
participants (including prospective assignees and participants);
provided that the Lender shall require any such prospective
assignee or such participant (prospective or otherwise) to agree
in writing to maintain the confidentiality of such information.
Section 11.5 Notices. Unless the party to be
notified otherwise notifies the other party in writing as
provided in this Section, and except as otherwise provided in
this Agreement, notices shall be given to the Lender and to the
Borrower by telecopier or by overnight courier or by personal
delivery addressed to such party at its address on the signature
page of this Agreement with a copy to the Committee c/o Xxxxxx
X. Siffen, Esq., Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP,
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, telecopier number:
000-000-0000, telephone number: 000-000-0000.
Section 11.6 Table of Contents; Headings. Any table
of contents and the headings and captions hereunder are for
convenience only and shall not affect the interpretation or
construction of this Agreement.
Section 11.7 Severability. The provisions of this
Agreement are intended to be severable. If for any reason any
provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction, such
provision shall, as to such jurisdiction, be ineffective to the
extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any
other jurisdiction or the remaining provisions hereof in any
jurisdiction.
Section 11.8 Counterparts. This Agreement may be
executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument, and any
party hereto may execute this Agreement by signing any such
counterpart.
Section 11.9 Integration. The Facility Documents
set forth the entire agreement between the parties hereto
relating to the transactions contemplated thereby and supersede
any prior oral or written statements or agreements with respect
to such transactions.
Section 11.10 Governing Law. This Agreement shall be
governed by, and interpreted and construed in accordance with,
the internal laws of the State of New York, except to the extent
governed by the Bankruptcy Code.
Section 11.11 Waiver of Jury Trial. BY ITS EXECUTION
AND DELIVERY OF THIS AGREEMENT THE BORROWER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION AGAINST THE LENDER,
ANY PARTICIPANT, ASSIGNEE OR INDEMNIFIED PARTY, BASED HEREON OR
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE
NOTES OR ANY OTHER FACILITY DOCUMENT, ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
THE LENDER OR THE BORROWER IN CONNECTION HEREWITH OR THEREWITH.
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER TO ENTER
INTO THIS AGREEMENT.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed as of the day and year first
above written.
EMPIRE ONE TELECOMMUNICATIONS,
INC., as Borrower
By
Title:
Address for Notices:
Telephone:
Telecopy No.:
EOT LENDING CORP., as Lender
By
Title: President
Address for Notices:
Telephone:
Telecopy No.:
SCHEDULE I
SUBSIDIARIES
Subsidiaries of Empire One Telecommunications, Inc.:
1. EOT Telecommunications of Canada, Inc.
2. Empire One Power, Inc.
