EXHIBIT 10.11
EXECUTION COPY
AMENDMENT NO. 10 AND LIMITED WAIVER
TO
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 10 AND LIMITED WAIVER TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT (this "AMENDMENT"), dated as of May 6, 2002, is
among KMC TELECOM LLC, a Delaware limited liability company (f/k/a KMC TELECOM
INC., a Delaware corporation) ("KMC"), KMC TELECOM II LLC, a Delaware limited
liability company (f/k/a KMC TELECOM II, INC., a Delaware corporation) ("KMC
II"), KMC TELECOM III LLC, a Delaware limited liability company (f/k/a KMC
TELECOM III, INC., a Delaware corporation) ("KMC III"), KMC TELECOM OF VIRGINIA,
INC., a Virginia public service company ("KMC VIRGINIA"), KMC TELECOM LEASING I
LLC, a Delaware limited liability company ("LEASING I"), KMC TELECOM LEASING II
LLC, a Delaware limited liability company ("LEASING II"), KMC TELECOM LEASING
III LLC, a Delaware limited liability company ("LEASING III"), KMC ▇▇▇▇▇▇▇.▇▇▇,
INC., a Delaware corporation ("▇▇▇▇▇▇▇.▇▇▇"), KMC III SERVICES LLC, a Delaware
limited liability company ("SERVICES"; KMC, KMC II, KMC III, KMC Virginia,
Leasing I , Leasing II, Leasing III, ▇▇▇▇▇▇▇.▇▇▇ and Services being hereinafter
collectively referred to as the "BORROWERS"), the "Lenders" party hereto,
WACHOVIA BANK, NATIONAL ASSOCIATION (f/k/a First Union National Bank), as
administrative agent for the Lenders (the "AGENT") and CIT LENDING SERVICES
CORPORATION (f/k/a NEWCOURT COMMERCIAL FINANCE CORPORATION), as collateral agent
for the Lenders (the "COLLATERAL AGENT").
WHEREAS, the Borrowers, the Agent, the Collateral Agent and
the Lenders are parties to that certain Amended and Restated Loan and Security
Agreement dated as of February 15, 2000, as amended by Amendment No. 1 thereto
dated as of March 28, 2000, Amendment No. 2 thereto dated as of July 28, 2000,
Amendment No. 3 and Limited Waiver thereto dated as of February 23, 2001,
Amendment No. 4 and Limited Waiver thereto dated as of April 12, 2001, Amendment
No. 5 and Limited Waiver thereto dated as of July 16, 2001, Amendment No. 6 and
Limited Waiver thereto dated as of January 31, 2002, Amendment No. 7, Limited
Waiver and Consent thereto dated as of February 20, 2002, Amendment No. 8 and
Extension of Limited Waiver dated as of March 28, 2002 and Amendment No. 9 and
Extension of Limited Waiver thereto dated as of April 15, 2002 (as so amended,
the "LOAN AGREEMENT"; undefined capitalized terms used herein shall have the
meanings assigned thereto in the Loan Agreement), pursuant to which the Lenders
have agreed to make certain "Loans" and other financial accommodations to the
Borrowers;
WHEREAS, the Borrowers have requested that Lenders (i) modify
certain financial covenants so that the Borrower may be in compliance with the
March 2002 Business Plan (as hereinafter defined) under the Loan Agreement, (ii)
waive certain Defaults and Events of Default that may have occurred and (iii)
make certain other amendments to the Loan Agreement, in each case as set forth
herein; and
AMENDMENT NO. 10 & LIMITED WAIVER
WHEREAS, the Lenders have agreed to the waivers and amendments
requested by the Borrowers as set forth below, but only on the terms and
conditions set forth in this Amendment.
NOW, THEREFORE, in consideration of the premises set forth
above, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Borrowers and the Lenders
agree as follows:
1. AMENDMENTS TO THE LOAN AGREEMENT. Effective as of the date
first above written and subject to the satisfaction of the conditions set forth
in Section 5 below, the Loan Agreement shall be and hereby is amended as
follows:
1.1 AMENDED REFERENCES TO FEBRUARY 2001 BUSINESS PLAN. All
references to "February 2001 Business Plan" appearing in the Loan Agreement
shall be amended to be references to "March 2002 Business Plan".
1.2 AMENDED REFERENCES TO FUNB. All references to "FUNB"
appearing in the Loan Agreement shall be amended to be references to "Wachovia".
1.3 Amendments to Section 1.02 (Definitions).
(a) The definition of "Business" set forth in SECTION 1.02 is
hereby amended to (i) delete the word "and" appearing immediately before CLAUSE
(IV) thereof, and (ii) insert at the end thereof the following new CLAUSE (V) as
follows: "and (v) KMC Holdings, the business of being a holding company and
conducting such other activities expressly permitted by SECTION 6.09."
(b) SECTION 1.02 is further amended to delete in their
entirety the definitions of "Cash Advance", "Credit Advance", "Data Holdco
Allocation Amount", "Excess Data Cash Flow", "FUNB", "Year 2000 Corrective
Actions", "Year 2000 Corrective Plan", "Year 2000 Date-Sensitive
System/Component", "Year 2000 Implementation Testing", and "Year 2000 Problems".
(c) SECTION 1.02 is further amended to amend and restate the
definitions of "Asset Sale", "Additional Purchased Notes", "EBITDA", "Net Asset
Sale Proceeds" and "Term B Loan Termination Date" appearing therein as follows:
"'ASSET SALE' shall mean the sale, transfer
or other disposition by KMC Holdings or any of its
Subsidiaries to any Person of (i) substantially all of the
assets of any division or line of business of KMC Holdings or
such Subsidiary, or (ii) any other assets (whether tangible or
intangible, but excluding sales of inventory in the ordinary
course of business), including any sale leaseback transaction
expressly permitted pursuant to SECTION 6.15, but excluding
(x) any securitization permitted pursuant to SECTION 6.13(XI),
and (y) any Ordinary Course IRU.
AMENDMENT NO. 10 & LIMITED WAIVER 2
'ADDITIONAL PURCHASED NOTES' shall mean the
Additional Purchased Notes as defined in Section 2(a) of the
Seventh Amendment and the Second Series Additional Purchased
Notes as defined in Section 2.4 of the Tenth Amendment.
'EBITDA' shall mean, with respect to any
Person, for any period, an amount equal to (i) Net Income PLUS
(ii) the sum of the following, to the extent deducted in
determining Net Income: (A) income taxes, (B) interest
expense, (C) amortization, depreciation and other non-cash
charges, (D) restructuring charges for fiscal year 2002 in an
aggregate amount not to exceed $35,000,000, (E) any fees and
expenses of the Lenders and Borrowers in connection with the
Loan Documents, (F) other restructuring charges in connection
with Borrowers' wind-down of operations in any city and
acceptable to Requisite Lenders and (G) any asset - impairment
charges permitted by GAAP MINUS (iii) the sum of interest
income plus extraordinary gains, as determined in accordance
with GAAP as calculated at the end of such period.
'NET ASSET SALE PROCEEDS' shall mean, with
respect to any Asset Sale, cash payments (including any cash
received by way of deferred payment pursuant to, or by
monetization of, a note receivable or otherwise, but only as
and when so received) received from such Asset Sale, net of
any bona fide direct costs incurred in connection with such
Asset Sale, including (i) income taxes reasonably estimated to
be actually payable within two years of the date of such Asset
Sale as a result of any gain recognized in connection with
such Asset Sale and (ii) payment of the outstanding principal
amount of, premium or penalty, if any, and interest on any
Debt (other than the Loans) that is secured by a Lien on the
stock or assets in question and that is required to be repaid
under the terms thereof as a result of such Asset Sale.
'TERM B LOAN COMMITMENT TERMINATION DATE'
shall mean April 1, 2007."
(d) SECTION 1.02 is further amended to insert the following
new definitions therein in alphabetical order:
"'AVAILABLE CASH' shall mean all cash and
cash equivalents including all amounts and investments on
deposit in any account maintained with any bank or other
financial institution and all investments held by any
securities intermediary.
'BROADWING ASSETS' shall mean all equipment
and other assets of KMC VII transferred to a Borrower and
pledged to the Collateral Agent as additional Collateral for
the Obligations pursuant to Section 5(a)(8) of the Tenth
Amendment.
'CENTURYTEL ASSET SALE' shall mean the
Subject Asset Sale (as defined in the Seventh Amendment).
AMENDMENT NO. 10 & LIMITED WAIVER 3
'CENTURYTEL PROCEEDS' shall mean the Net
Asset Sale Proceeds received by Borrowers on February 28, 2002
in connection with the Subject Asset Sale.
'CENTURYTEL PROCEEDS ACCOUNT' shall mean
collateral account number ▇▇▇▇▇▇▇▇ established by KMC II at
Wachovia.
'CENTURYTEL PROCEEDS AMOUNT' shall mean
$41,230,578.
'DRESDNER' shall mean Dresdner Kleinwort
▇▇▇▇▇▇▇▇▇▇▇ - Grantchester, Inc.
'EXCESS AVAILABLE DATA CASH' shall have the
meaning given to such term in Section 5.22.
'INCREMENTAL NET ASSET SALE PROCEEDS' shall
mean, with respect to any Asset Sale, one hundred percent
(100%) of the related Net Asset Sale Proceeds minus the amount
of such Net Asset Sale Proceeds required to be applied to
prepay the Loans and permanently reduce the Revolving Loan
Commitment Amount pursuant to Section 2.09(c)(iii).
'IRU ASSET SALE' shall mean an indefeasible
right to use specific fibers and related equipment in a fiber
optic System owned by one or more Borrowers on the Tenth
Amendment Effective Date providing for net revenues to the
Borrowers in excess of $2million per year.
'KMC I-III PORTS' shall mean those ports to
be transferred from Borrowers to KMC Funding V LLC as
described in Attachment O to the Tenth Amendment.
'MARCH 2002 BUSINESS PLAN' shall mean that
certain Business Plan 2002 (Preliminary) of KMC Holdings and
its Subsidiaries presented to the Lenders on March 22, 2002.
'NET SECURITIZATION PROCEEDS' shall mean,
with respect to the Securitization, cash payments (including
any cash received by way of deferred payment pursuant to, or
by monetization of, a note receivable or otherwise, but only
as and when so received) received from the Securitization, net
of any bona fide direct costs incurred in connection with the
Securitization, including (i) income taxes reasonably
estimated to be actually payable within two years after the
date of the Securitization as a result of any gain recognized
in connection with the Securitization, (ii) the amount of cash
reserves for (x) interest to be payable to the holders of any
securities issued in connection with the Securitization and
(y) other expenses, in each case required as of the date of
consummation of the Securitization pursuant to the terms of
the operative documents governing the Securitization and (iii)
payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Debt (other
AMENDMENT NO. 10 & LIMITED WAIVER 4
than the Loans) that is secured by a Lien on the stock or
assets in question and that is required to be repaid under the
terms thereof as a result of the Securitization.
'ORDINARY COURSE IRU' shall mean an
indefeasible right to use specified fibers in a fiber optic
System to be constructed, installed and tested by one or more
Borrowers after the Tenth Amendment Effective Date, which
fibers are dark fibers to the extent part of an existing
System of a Borrower at the time of execution of the related
IRU Agreement.
'OPTION AGREEMENTS' shall mean (i) that
certain Option Transaction Letter Agreement dated as of March
8, 2002 between Dresdner and KMC as successor in interest to
KMC II (successor in interest to Data Holdco), covering the
Option Entitlement of $19,000,000 [Face Amount] of Coupon
Notes per Option; (ii) that certain Option Transaction Letter
Agreement dated as of March 8, 2002 between Dresdner and KMC
as successor in interest to KMC II (successor in interest to
Data Holdco), covering the Option Entitlement of $7,000,000
[Face Amount] of Coupon Notes per Option; (iii) that certain
Option Transaction Letter Agreement dated as of March 8, 2002
between Dresdner and KMC as successor in interest to KMC II
(successor in interest to Data Holdco), covering the Option
Entitlement of $4,000,000 [Face Amount] of Coupon Notes per
Option; (iv) that certain Option Transaction Letter Agreement
dated as of March 8, 2002 between Dresdner and KMC as
successor in interest to KMC II (successor in interest to Data
Holdco), covering the Option Entitlement of $23,565,000 [Face
Amount] of Coupon Notes per Option; (v) that certain Option
Transaction Letter Agreement dated as of March 8, 2002 between
Dresdner and KMC as successor in interest to KMC II (successor
in interest to Data Holdco), covering the Option Entitlement
of $23,000,000 [Face Amount] of Coupon Notes per Option and
(vi) that certain Option Transaction Letter Agreement dated as
of March 22, 2002 between Dresdner and KMC II (successor in
interest to Data Holdco), covering the Option Entitlement of
$2,000,000 [Face Amount] of Coupon Notes per Option.
'PERFECTION CERTIFICATE' shall mean a
perfection certificate in the form agreed to by the Borrowers
and the Collateral Agent.
'QWEST/MGS EXTENSION' shall mean the
extension to December 31, 2005 of the term of each of the
Agreements set forth on ATTACHMENT N to the Tenth Amendment.
'SECURITIZATION' shall mean the sale,
transfer or other monetization of the Qwest/MGS Extension,
which sale, transfer or monetization is used to support
securities sold to investors in publicly registered or
privately placed securities.
'SECOND SERIES OF ADDITIONAL PURCHASED
NOTES' shall mean the Second Series of Additional Purchased
Notes as defined in Section 2.4 of the Tenth Amendment.
AMENDMENT NO. 10 & LIMITED WAIVER 5
'TENTH AMENDMENT' shall mean that certain
Amendment No. 10 and Limited Waiver to Amended and Restated
Loan and Security Agreement dated as of May 6, 2002 by and
among the appropriate parties.
'TENTH AMENDMENT EFFECTIVE DATE' shall mean
the Tenth Amendment Effective Date as defined in Section 5 of
the Tenth Amendment.
'UNFUNDED REVOLVING AMOUNT' shall mean
$7,775,060, which amount represents the unfunded Revolving
Loan Commitment Amount as of the Tenth Amendment Effective
Date.
'UNFUNDED TERM B AMOUNT' shall mean
$30,059,891, which amount represents the unfunded Term B Loan
Commitment Amount as of the Tenth Amendment Effective Date.
'WACHOVIA' shall mean Wachovia Bank,
National Association (f/k/a First Union National Bank)."
1.4 AMENDMENTS TO ARTICLE II (LOANS AND LETTERS OF CREDIT).
(a) AMENDMENT TO SECTION 2.01 (AGREEMENT TO LEND). Section
2.01 of the Loan Agreement is hereby amended by inserting a new clause (e) at
the end thereof as follows:
"(e) Notwithstanding anything herein to the
contrary, from and after the Tenth Amendment Effective Date,
all requests for Revolving Loans and Term B Loans shall be
made on a pro rata basis based on the Unfunded Revolving
Amount and the Unfunded Term B Amount until such time as the
Term B Loan Commitment has either terminated or been fully
drawn pursuant to the terms hereof."
(b) AMENDMENTS TO SECTION 2.02 (LOANS).
(1) CLAUSE (A) of SECTION 2.02 is hereby amended and restated
in its entirety as follows:
"(a) The proceeds of the Loans shall be used
by the Borrowers to purchase Telecommunications Equipment, to
pay transaction costs incurred in connection with the
execution, delivery and performance of the Loan Documents, and
for working capital and other general corporate purposes
(subject to any restrictions contained in the Indentures), all
as specified in the Notice of Borrowing and in accordance with
the March 2002 Business Plan. Loans with respect to
Telecommunications Equipment purchases may not be made to
finance (i) soft costs (including installation, delivery and
engineering costs) in excess of fifteen percent (15%) of the
invoiced price for the related Switch Equipment or (ii) any
support or installation costs associated with an operational
system that would not be capitalized in accordance with GAAP."
AMENDMENT ▇▇. ▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇
(▇) ▇▇▇▇▇▇ (▇) of SECTION 2.02 is hereby amended and restated
in its entirety as follows:
"(d) [Intentionally Omitted]"
(c) AMENDMENTS TO SECTION 2.03 (PROCEDURE FOR LOAN REQUEST AND
BORROWING COMMITMENT).
(1) CLAUSE (A) of SECTION 2.03 is hereby amended and restated
in its entirety as follows:
"(a) A Borrower requesting a Loan shall
deliver to each of the Agent and the Collateral Agent a
Borrowing Supplement dated as of the date of such request and
a Notice of Borrowing substantially in the form of EXHIBIT H-1
attached hereto on or before 11:00 a.m. (New York time) at
least five (5) Business Days prior to the date on which such
Loan is requested to be made if such Loan is requested to be a
LIBOR Loan and at least two (2) Business Days prior to the
date on which such Loan is requested to be made if such Loan
is requested to be a Base Rate Loan, which notice, once given,
shall be irrevocable; PROVIDED, HOWEVER, that only the
Collateral Agent shall receive the attachments to the Notice
of Borrowing, as outlined below. In the case of a Loan the
proceeds of which will be used to purchase or reimburse any
Borrower for Telecommunications Equipment, the Notice of
Borrowing delivered to the Collateral Agent will include a
schedule supporting one hundred percent (100%) of
Telecommunications Equipment requested to be funded. Such
schedule will detail all invoices for equipment, third party
labor, permits, other third party costs and all capitalized
internal costs of the Borrowers with respect to such
Telecommunications Equipment permitted under GAAP. All
invoices over $25,000 will be attached to such schedule
delivered to the Collateral Agent who shall review such
invoices and verify that, when combined with the above
described capitalized internal costs, such invoices will
support at least seventy percent (70%) of the total requested
funding. In the case of a Loan the proceeds of which will be
used to pay or reimburse any Borrower for transaction costs,
the Notice of Borrowing delivered to the Collateral Agent will
include a copy of the invoice from the provider of the service
or other appropriate supporting documentation. In the case of
any Loan, the proceeds of which will be used for working
capital or other general corporate purposes, the Notice of
Borrowing delivered to the Collateral Agent will contain a
certification that the making of such Loan does not violate
any provision of either Indenture or the terms of the
preferred Equity Interests of KMC Holdings. The Notice of
Borrowing shall, with respect to any Loans requested, specify
whether such requested Loans are to be Base Rate Loans or
LIBOR Loans, and if such requested Loans are to be LIBOR
Loans, the requested Interest Period for such Loans."
(2) CLAUSE (B) of SECTION 2.03 is hereby amended to delete the
proviso in the second sentence thereof in its entirety.
AMENDMENT NO. 10 & LIMITED WAIVER 7
(3) CLAUSE (C) of SECTION 2.03 is hereby amended to delete the
following parenthetical in each instance in which it appears therein: "(other
than in the case of Lucent with respect to its Pro Rata Share of a Term B Loan
consisting of a Credit Advance)".
(4) CLAUSE (D) of SECTION 2.03 is hereby deleted in its
entirety.
(d) AMENDMENTS TO SECTION 2.08 (PAYMENTS). SECTION 2.08(B) is
hereby amended to (i) insert after the words "Revolving Credit Commitment
Termination Date" the words "and, to the extent required pursuant to Section
2.09(d)(i), on each date set forth in ANNEX C hereto" and (ii) insert the
following words at the end of the second sentence thereof: "and, from and after
the Tenth Amendment Effective Date, in the event Term B Lender makes any
additional Term B Loans, each of the then remaining scheduled installments of
the principal of the Term B Loans set forth on Annex C shall be increased PRO
RATA by the amount of any such drawing"
(e) AMENDMENTS TO SECTION 2.09 (OPTIONAL AND MANDATORY
PREPAYMENT OF LOANS; OPTIONAL AND MANDATORY REDUCTION OF REVOLVING LOAN
COMMITMENT AMOUNT).
(1) CLAUSE (VII) of SECTION 2.09(C) is hereby amended and
restated in its entirety as follows: "(c) [Intentionally Omitted]".
(2) CLAUSE (IX) of SECTION 2.09(C) is hereby amended to (i)
insert the word "permanently" immediately before the word "reduced" set forth
therein and (ii) insert the following proviso at the end thereof: "; PROVIDED
that notwithstanding anything in the foregoing to the contrary and unless
Requisite Revolving Lenders consent to the contrary in writing prior to July 1,
2003, the Revolving Loan Commitment Amount of all Lenders shall be further
permanently reduced on July 1, 2003 by the lesser of (a) fifty percent (50%) of
the Unfunded Revolving Amount and (b) an amount equal to the Unfunded Revolving
Amount multiplied by a fraction, the numerator of which is the amount by which
the Term B Loan Commitment Amount is reduced on such date pursuant to SECTION
2.09(C)(X) and the denominator of which is the Unfunded Term B Amount; PROVIDED
FURTHER that such reduction shall not apply to the Unused Letter of Credit
Subfacility."
(3) SECTION 2.09(C) is further amended to (i) FIRST, insert
the words "Incremental Asset Sale Proceeds" immediately after the word "Excess
Operating Cash Flow" appearing in CLAUSE (X) thereof, (iii) SECOND, renumber
CLAUSE (X) thereof as new CLAUSE (XI), and (iv) THIRD, insert new CLAUSE (X)
thereof as follows:
"(x) Unless the Term B Lenders consent to
the contrary in writing prior to July 1, 2003, the Term B Loan
Commitment Amount shall be permanently reduced on July 1, 2003
by the lesser of (a) fifty percent (50%) of the Unfunded Term
B Amount and (b) the sum of (1) the Unfunded Term B Amount
minus (2) the aggregate principal amount of all Term B Loans
advanced to Borrowers after the Tenth Amendment Effective
Date;".
(4) CLAUSE (I) of SECTION 2.09(D) is hereby amended to insert
immediately after the words "reductions of the Revolving Loan Commitment Amount
set forth on ANNEX C"
AMENDMENT NO. 10 & LIMITED WAIVER 8
appearing in the third sentence thereof the words "in forward order of maturity
until all scheduled reductions occurring during the fiscal year 2003 have been
reduced to zero and thereafter,".
(5) CLAUSE (II) of SECTION 2.09(D) is hereby amended to insert
immediately after the words "unpaid at the time of such prepayment" the words
"in forward order of maturity until all scheduled installments occurring during
the fiscal year 2003 have been reduced to zero and thereafter,".
1.5 AMENDMENTS TO ARTICLE III (REPRESENTATIONS AND
WARRANTIES).
(a) SECTION 3.03 is hereby amended (i) to delete the date
"December 31, 1998" appearing therein and substitute therefor the date "December
31, 2000" and (ii) to delete the date "September 30, 1999" appearing therein and
substitute therefor the date "September 30, 2001."
(b) SECTION 3.04 is hereby amended and restated in its
entirety: "There has been no material adverse change in the condition (financial
or otherwise), operations or properties of the Borrowers since the date of the
Financials, provided, however, that until the Borrowers have received
$38,145,000 in unrestricted funds from any source, such material adverse change
shall be defined as the failure to meet any condition or covenant set forth in
Article VII."
(c) AMENDMENT TO SECTION 3.09 (LICENSES, MATERIAL AGREEMENTS,
INTELLECTUAL PROPERTY). CLAUSE (B) of SECTION 3.09 is hereby amended to insert
immediately after the phrase "all purchase agreements," appearing therein the
phrase "the Option Agreements,".
(d) AMENDMENT TO SECTION 3.24 (YEAR 2000 PROBLEMS). SECTION
3.24 is hereby amended and restated in its entirety as follows:
"SECTION 3.24. COMPLIANCE WITH INDENTURES AND SERIES
E PREFERRED STOCK. All outstanding Loans are and since the
date of borrowing have been, and all Loans requested hereunder
will be at the time of such request, permitted pursuant to the
terms of Section 403 of each of the Indentures and Section
XI(A) of the Certificate of Designations of the Series E
Preferred Stock.
(e) AMENDMENT TO SECTION 3.27 (LUCENT AGREEMENTS). SECTION
3.27 is hereby amended and restated in its entirety as follows:
"[Intentionally Omitted]"
1.6 AMENDMENTS TO ARTICLE IV (CONDITIONS FOR LOANS).
(a) AMENDMENT TO SECTION 4.02 (CONDITIONS PRECEDENT TO ALL
LOANS).
(1) SECTION 4.02 is hereby amended to (i) insert the words "or
Collateral Account Release" immediately after the first appearance of the word
"Loan" therein, (ii) insert the words "or Collateral Account Release"
immediately after each appearance of the words
AMENDMENT NO. 10 & LIMITED WAIVER 9
"such Loan" thereof (other than in CLAUSES (D) and (F) thereof), and (iii)
insert the words "or Collateral Account Release" immediately after the words "a
Loan" appearing in CLAUSE (M) thereof.
(2) SECTION 4.02(C) is hereby amended and restated in its
entirety as follows:
"(c) At the time of each such Loan or Letter
of Credit and after giving effect to each such Loan or Letter
of Credit, there shall have been no material adverse change in
the condition (financial or otherwise), operations, properties
or prospects of any Borrower since the date of the Financials,
provided, however, that until the Borrowers have received
$38,145,000 in unrestricted funds from any source, such
material adverse change shall be defined as the failure of any
condition or covenant set forth in Article VII."
(3) SECTION 4.02 is further amended to insert new CLAUSES (N),
(O) and (P) at the end thereof as follows:
"(n) Concurrently with the delivery of a
Notice of Borrowing or Request for Collateral Account Release
(other than the initial request for Collateral Account
Release), as the case may be, the Agent shall have received an
officer's certificate of the Chief Financial Officer of KMC
Holdings certifying that (i) the amount of Available Cash of
Borrowers does not exceed $20,000,000, exclusive of amounts on
deposit in the CenturyTel Proceeds Account and, (ii) all
amounts required to be transferred by Data Holdco and the Data
Subsidiaries to KMC Holdings and contributed by KMC Holdings
to the Borrowers pursuant to SECTION 5.22 have been so
transferred and contributed
(o) Concurrently with the delivery of a
Notice of Borrowing, the Agent shall have received an
officer's certificate of the chief financial officer of KMC
Holdings certifying that all funds on deposit in the
CenturyTel Proceeds Account have been released.
(p) The Agent shall have received a Request
for Collateral Account Release for such Collateral Account
Release and acceptance certificate and invoices required by
SECTION 5.29."
1.7 AMENDMENTS TO ARTICLE V (AFFIRMATIVE COVENANTS).
(a) Amendments to Section 5.06 (Obligations and Taxes).
(1) CLAUSE (B) of SECTION 5.06 is hereby amended to (i) insert
the words "for the single quarter period" immediately after the words "each of
the foregoing" appearing therein and (ii) insert the parenthetical "(other than
with respect to statements of cash flows only)" immediately before the words
"for the then elapsed portion of the fiscal year" appearing therein.
(2) CLAUSE (C) of SECTION 5.06 is hereby amended and restated
in its entirety as follows:
AMENDMENT NO. 10 & LIMITED WAIVER 10
"(c) (i) within forty-five (45) days after
the end of each month during each fiscal year (or within one
hundred twenty (120) days after the end of each December)
commencing with the month ending March 31, 2002, (x)
consolidating unaudited balance sheets for Borrowers and
unaudited statements of operations for KMC Holdings, Data
Holdco and the Borrowers, in each case on a combined basis,
each of the foregoing as of the end of each such month, as
applicable, and for the then elapsed portion of the fiscal
year and (y) a detailed statement of operations for the
Borrowers on a combined basis for such month and year-to-date
period with comparisons to the corresponding projections for
such month and year-to-date period set forth in the March 2002
Business Plan and (ii) no later than the first and third
Friday of each month commencing May 3, 2002, in each case for
the prior four calendar week period, projected thirteen (13)
calendar week cash flow analyses for KMC Holdings, Data Holdco
and the Borrowers on a consolidated and individual entity
basis consisting of projected statements of cash receipts and
disbursements, in each case for the succeeding thirteen (13)
calendar week period and actual statements for the previous
four calendar weeks then ended together with a comparison of
such actual statements to the projected statements for such
four weeks;".
(3) CLAUSE (E) of SECTION 5.06 is hereby amended to (i) insert
the figure (A) immediately after the date "September 30," appearing therein and
(ii) insert the following new language before the ";" at the end thereof:
"and (B) a completed Perfection Certificate signed by
the chief financial officer of KMC Holdings;"
(4) CLAUSE (U) of SECTION 5.06 is hereby amended to (i) delete
the date "September 7, 2002" appearing therein and substitute therefor the date
"August 1, 2003" and (ii) delete the words "sixty (60)" and replace them with
the words "fourteen (14)."
(b) AMENDMENT TO SECTION 5.22 (CASH OF NON-BORROWER
SUBSIDIARIES). SECTION 5.22 is hereby amended and restated in its entirety as
follows:
"SECTION 5.22. Cash of Non-Borrower Subsidiaries.
"(a) Until such time as (i) the Borrowers are free
cash flow positive (EBITDA, less capital expenditures and less
debt service obligations (principal and interest))and (ii)
$25,000,000 plus the CenturyTel Proceeds Amount (less any
balance in the CenturyTel Proceeds Account) has been
contributed to the Borrowers, if Data Holdco and the Data
Subsidiaries at any time have Available Cash in excess of
$50,000,000 in the aggregate ("Excess Available Data Cash"),
then KMC Holdings shall cause Data Holdco and the Data
Subsidiaries to distribute promptly, but in no event later
than one Business Day after the occurrence of such excess,
such Excess Available Data Cash to KMC Holdings as a dividend,
subordinated loan or other form of distribution acceptable to
Requisite Lenders pursuant to documentation in form and
substance satisfactory to Requisite Lenders; provided that
neither KMC Holdings nor any other Loan Party
AMENDMENT NO. 10 & LIMITED WAIVER 11
shall make any payment or otherwise incur any obligation to
Data Holdco or any other Person in connection with such
transfer (nor shall such transfer be offset against, or
treated as a payment or prepayment of, any amount to become
due from any Data Subsidiary or any such other Person).
(b) Concurrently with the receipt by KMC
Holdings of any cash dividends or other distributions from
Data Holdco consisting of Excess Available Data Cash pursuant
to this SECTION 5.22, KMC Holdings shall contribute such
amounts to the Borrowers as a capital contribution by
depositing such amounts in a Collection Account of Borrowers
subject to a Restricted Account Agreement pursuant to SECTION
8.04."
(c) ARTICLE V is further amended to insert a new SECTION 5.29
at the end thereof as follows:
"SECTION 5.29. CENTURYTEL PROCEEDS ACCOUNT.
Notwithstanding anything in the Limited Waiver to Loan
Agreement dated as of April 5, 2002 to the contrary, Requisite
Lenders agree to the release of $38,145,000 from the
CenturyTel Account to KMC II and direct the Collateral Agent
to instruct Wachovia to release $38,145,000 to KMC II from the
CenturyTel Account concurrently with the execution of the
Tenth Amendment. For the avoidance of doubt, the parties
hereto acknowledge and agree that the CenturyTel Proceeds
Account does not constitute substantially all of the
Collateral. In addition, in the event KMC II desires that
Collateral Agent instruct Wachovia to release additional
amounts on deposit in the CenturyTel Proceeds Account to KMC
II (each, a "COLLATERAL ACCOUNT RELEASE"), KMC II shall comply
with each of the conditions set forth in SECTIONS 5.29(A)-(C).
(a) KMC II shall deliver to each of the Agent and
the Collateral Agent a Request for Collateral Account Release
dated as of the date of such request substantially in the form
of EXHIBIT W on or before 11:00 a.m. (New York time) at least
two (2) Business Days prior to the date on which such
Collateral Account Release is requested to be made. In the
case of a Collateral Account Release the proceeds of which
will be used to purchase or reimburse any Borrower for
Telecommunications Equipment, the Request for Collateral
Account Release delivered to Collateral Agent will include a
schedule supporting one hundred percent (100%) of
Telecommunications Equipment requested to be funded. Such
schedule will detail all invoices for equipment, third party
labor, permits, other third party costs and all capitalized
internal costs of the Borrowers with respect to such
Telecommunications Equipment permitted under GAAP. All
invoices over $25,000 will be attached to such schedule
delivered to the Collateral Agent who shall review such
invoices and verify that, when combined with the above
described capitalized internal costs, such invoices will
support at least seventy percent (70%) of the total requested
funding. In the case of a Collateral Account Release the
proceeds of which will be used to pay or reimburse any
Borrower for transaction costs, the Request for Collateral
Account Release delivered to the
AMENDMENT NO. 10 & LIMITED WAIVER 12
Collateral Agent will include a copy of the invoice from the
provider of the service or other appropriate supporting
documentation.
(b) The proceeds of any such Collateral Account
Release shall be used by the Borrowers to purchase
Telecommunications Equipment, to pay transaction costs
incurred in connection with the execution, delivery and
performance of the Loan Documents, and for working capital and
other general corporate purposes (subject to any restrictions
contained in the Indentures), all as specified in the Notice
of Collateral Account Release and in accordance with the March
2002 Business Plan.
(c) Borrowers shall have satisfied all conditions
to a Collateral Account Release set forth in SECTION 4.02.
(d) Upon receipt of a Request for Collateral
Account Release and the satisfaction of all conditions to a
Collateral Account Release set forth in SECTIONS 5.29(A)-(C),
the Collateral Agent shall instruct Wachovia to release the
requested amount to KMC II from the CenturyTel Proceeds
Account pursuant to the terms and conditions of the applicable
Account Control Agreement.
(e) Notwithstanding anything to the contrary
contained herein or in the Loan Agreement, KMC II shall have
the right to prepay the Loans by directing the Agent to apply
the balance (or any portion thereof) in the CenturyTel
Proceeds Account to prepay the Loans."
(d) ARTICLE V is further amended to insert a new SECTION 5.30
at the end thereof as follows:
"SECTION 5.30. SECOND SERIES OF ADDITIONAL
PURCHASED NOTES. On or before June 30, 2002, Borrowers shall
have transferred to those Lenders who shall have deferred in
writing, on or before May 31, 2002, (the "Deferring Lenders"),
their right to receive their pro rata share of the principal
balance of the Loans then otherwise due and payable on April
1, 2003 until June 30, 2003, such Lender's pro rata share
(based upon each Deferring Lender's portion of the total
aggregate outstanding amount of principal deferred by the
Deferring Lenders) of $43,000,000 [face amount] of the 12 1/2%
Senior Discount Notes due 2008 and owned by the Borrowers and
15% of Second Series of Additional Purchased Notes (and such
12 1/2% Senior Discount Notes due 2008 and Second Series of
Additional Purchased Notes transferred to the Deferring
Lenders shall be released by the Collateral Agent from its
liens)."
1.8 AMENDMENTS TO ARTICLE VI (NEGATIVE COVENANTS).
(a) AMENDMENTS TO SECTION 6.03 (SALES OF ASSETS,
CONSOLIDATION, MERGER, ETC.).
AMENDMENT NO. 10 & LIMITED WAIVER 13
(1) SECTION 6.03(A) and SECTION 6.03(B) are each hereby
amended by inserting the words "or enter into any securitization" immediately
after the words "or sell or discount any receivables" appearing therein.
(2) CLAUSE (II) of SECTION 6.03(A) is hereby amended and
restated in its entirety as follows:
"(ii) any Loan Party (other than KMC Holdings and
Data Holdco) may grant IRUs pursuant to IRU Agreements and IRU
Service Orders entered into pursuant to SECTION 6.18; PROVIDED
that all Net Asset Sale Proceeds with respect to any such IRU
Agreement or IRU Service Order constituting an IRU Asset Sale
are applied to prepay Loans and reduce the Revolving Loan
Commitment Amount as provided in SECTION 2.09(C)(III) and any
such Net Asset Sale Proceeds retained by the Loan Parties are
applied in compliance with the Indentures and the Certificate
of Designation of the Series E Preferred Stock and otherwise
deposited into a Collection Account of Borrowers subject to a
Restricted Account Agreement pursuant to SECTION 8.04;
PROVIDED FURTHER that the prepayment requirement of this
Section 6.03(a)(ii) shall not apply to (x) Net Asset Sale
Proceeds with respect to any one or series of related IRU
Asset Sales equal to an amount less than $2,000,000 up to an
aggregate cumulative amount of $10,000,000 for all such
excluded IRU Asset Sales;"
(3) SECTION 6.03(A) is further amended to insert the following
proviso at the end thereof: "PROVIDED FURTHER that notwithstanding anything in
the foregoing to the contrary, the applicable Borrower shall not be required to
apply any Net Asset Sale Proceeds from the sale of any Broadwing Assets to
prepay Loans or reduce the Revolving Loan Commitment Amount as provided in
SECTION 2.09(C)(III) so long as such Loan Party deposits such Net Asset Sale
Proceeds into a Collection Account subject to a Restricted Account Agreement
pursuant to SECTION 8.04 promptly upon receipt thereof."
(b) AMENDMENTS TO SECTION 6.05 (MANAGEMENT FEES AND PERMITTED
CORPORATE OVERHEAD). CLAUSE (I) of SECTION 6.05 of the Loan Agreement is hereby
amended and restated in its entirety to read as follows: "(i) usual and
customary charges payable to KMC Holdings and allocated to pay expenses incurred
in the ordinary course of business provided that an equal amount of such
expenses shall have been allocated to and paid by Data Holdco and its
Subsidiaries".
(c) AMENDMENT TO SECTION 6.09 (PERMITTED ACTIVITIES).
(1) SECTION 6.09(A) is hereby amended to (i) delete the word
"and" appearing immediately prior to CLAUSE (II) of the third sentence thereof
and (ii) insert a new CLAUSE (III) at the end of such third sentence as follows:
"and (iii) subject to the other restrictions
contained in this Agreement, the entering into of agreements
and contracts relating to leases, office equipment, furniture,
computers, software, software licenses, employment agreements,
non-
AMENDMENT NO. 10 & LIMITED WAIVER 14
disclosure and confidentiality agreements, and any other
agreements and contracts which relate to one or more
Subsidiaries in the ordinary course of business"
(2) SECTION 6.09(B) is hereby amended to amend and restate the
first sentence thereof as follows:
"Data Holdco shall not engage in any business or
activity other than (a) the ownership of the capital stock of
the Data Subsidiaries, (b) the performance of its obligations
under the Loan Documents, (c) the pledge of the capital stock
of a Data Subsidiary pursuant to SECTION 6.01(XI) and (d)
subject to the other restrictions contained in this Agreement,
the entering into of agreements and contracts relating to
leases, office equipment, furniture, computers, software,
software licenses, employment, non-disclosure and
confidentiality, and transport, collocation, operation,
maintenance and construction of telecommunications equipment
(including, but not limited to software or networks,
multi-service, internet protocol platform ports and/or
software and/or hardware), and any other agreements and
contracts which relate to one or more Data Subsidiaries in the
ordinary course of business."
(d) AMENDMENT TO SECTION 6.13(INDEBTEDNESS). SECTION 6.13 is
hereby amended by (i) deleting the phrase "the February 2001 Business Plan and"
appearing in clause (iii) thereof and (ii) amending and restating clause (xi)(b)
thereof in its entirety to read "(b) in connection with any securitization of a
Data Contract to which such Data Subsidiary is a party (collectively, 'PERMITTED
DATA FINANCINGS')".
(e) AMENDMENT TO SECTION 6.18 (IRU AGREEMENTS AND IRU SERVICES
ORDERS). CLAUSE (I) of SECTION 6.18 is hereby amended to delete the first
proviso appearing therein.
1.9 AMENDMENTS TO SECTION 7.01 (FINANCIAL COVENANTS).
(a) CLAUSE (A) of SECTION 7.01 is hereby amended and restated
in its entirety as follows (solely for convenience, modified covenant levels are
italicized):
"(a) Minimum Core Revenues. As of the last day of
each fiscal quarter ending on or about each date set forth
below, the Borrowers shall on a combined basis have Core
Revenues for such quarter of not less than the following:
FISCAL QUARTER ENDING MINIMUM CORE
--------------------- ------------
REVENUES
--------
March 31, 2002 $38,089,000
June 30, 2002 $31,217,000
AMENDMENT NO. 10 & LIMITED WAIVER 15
FISCAL QUARTER ENDING MINIMUM CORE
--------------------- ------------
REVENUES
--------
September 30, 2002 $26,622,000
December 31, 2002 $26,006,000
March 31, 2003 $26,369,000
June 30, 2003 $27,571,000
September 30, 2003 $94,350,000
December 31, 2003 $101,563,000
March 31, 2004 $108,689,000
June 30, 2004 $115,839,000
September 30, 2004 $123,181,000
December 31, 2004 $130,719,000
March 31, 2005 $138,238,000
June 30, 2005 $145,665,000
September 30, 2005 $153,270,000
December 31, 2005 $161,059,000
March 31, 2006 $168,851,000
June 30, 2006 $176,630,000
AMENDMENT NO. 10 & LIMITED WAIVER 16
FISCAL QUARTER ENDING MINIMUM CORE
--------------------- ------------
REVENUES
--------
September 30, 2006 $184,562,000
December 31, 2006 $192,647,000
March 31, 2007 $200,862,000"
(b) CLAUSE (B) of SECTION 7.01 is hereby amended and restated
in its entirety as follows (solely for convenience, modified covenant levels are
italicized):
"(b) MINIMUM EBITDA. As of the last day of each
fiscal quarter ending on or about each date set forth below,
the Borrowers shall not permit EBITDA for all of the Borrowers
on a combined basis for the two fiscal quarters then ending to
be less than the following:
FISCAL QUARTER ENDING MINIMUM
--------------------- -------
EBITDA
------
March 31, 2002 $(23,778,000)
June 30, 2002 $(23,594,000)
September 30, 2002 $(22,178,000)
December 31, 2002 $(22,593,000)
March 31, 2003 $(22,501,000)
June 30, 2003 $(21,408,000)
September 30, 2003 $37,999,000
December 31, 2003 $48,006,000
March 31, 2004 $56,432,000
June 30, 2004 $64,727,000
September 30, 2004 $74,797,000
December 31, 2004 $85,175,000
March 31, 2005 $91,593,000
June 30, 2005 $97,885,000
September 30, 2005 $108,300,000
December 31, 2005 $118,986,000
AMENDMENT NO. 10 & LIMITED WAIVER 17
FISCAL QUARTER ENDING MINIMUM
--------------------- -------
EBITDA
------
March 31, 2006 $124,581,000
June 30, 2006 $129,900,000
September 30, 2006 $140,279,000
December 31, 2006 $150,876,000
March 31, 2007 $154,619,000"
(c) CLAUSE (C) of SECTION 7.01 is hereby amended and restated
in its entirety as follows (solely for convenience, modified covenant levels are
italicized):
"(c) MAXIMUM CAPITAL EXPENDITURES. As of the
last day of each fiscal quarter ending on or about each date
set forth below, the Borrowers shall not permit capital
expenditures (other than IRU Cap Ex) on a combined basis to
exceed the following:
FISCAL QUARTER ENDING MAXIMUM
--------------------- -------
CAPITAL
--------
EXPENDITURES
------------
March 31, 2002 $12,500,000
June 30, 2002 $10,500,000
September 30, 2002 $8,500,000
December 31, 2002 $8,500,000
March 31, 2003 $8,700,000
June 30, 2003 $12,575,000
September 30, 2003 $20,954,000
December 31, 2003 $22,458,000
March 31, 2004 $18,639,000
June 30, 2004 $19,753,000
September 30, 2004 $20,931,000
December 31, 2004 $22,178,000
March 31, 2005 $19,861,000
June 30, 2005 $20,799,000
September 30, 2005 $21,780,000
December 31, 2005 $22,804,000
AMENDMENT NO. 10 & LIMITED WAIVER 18
FISCAL QUARTER ENDING MAXIMUM
--------------------- -------
CAPITAL
--------
EXPENDITURES
------------
March 31, 2006 $17,279,000
June 30, 2006 $17,850,000
September 30, 2006 $18,439,000
December 31, 2006 $19,045,000
March 31, 2007 $19,670,000
; PROVIDED that to the extent that capital expenditures
permitted for any fiscal quarter during the 2002 fiscal year
exceed actual capital expenditures for such fiscal quarter,
the excess shall be permitted to be carried over to the
immediately succeeding fiscal quarter (the "Carry Over
Amount"); PROVIDED, HOWEVER, all amounts used for capital
expenditures in any fiscal quarter shall be deemed to count
first against any amounts carried over to such fiscal quarter
and then against any remaining amount permitted for any such
fiscal quarter; PROVIDED FURTHER, that, in no event shall the
Carry Over Amount from any fiscal quarter exceed (i)
$2,500,000 for the fiscal quarter ending ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇)
$5,000,000 for the fiscal quarter ending June 30, 2002, (iii)
$7,500,000 for the fiscal quarter ending September 30, 2002
and (iv) $10,000,000 for the fiscal quarter ending December
31, 2002; PROVIDED STILL FURTHER that no unused capital
expenditures may be carried over from the 2001 fiscal year or
beyond the fiscal quarter ending June 30, 2003."
1.10 AMENDMENTS TO SECTION 8.04 (COLLECTION OF ACCOUNTS AND
RESTRICTED ACCOUNT ARRANGEMENTS). SECTION 8.04 is hereby amended to insert
the following new language at the end thereof as follows:
"Wachovia in its capacity as the depository
institution with respect to the Collection Accounts shall have
no liability to any Agent, Lender or any Loan Party or any of
its Affiliates arising either directly or indirectly, by
reason of any Restricted Account Agreement or any transaction
or service contemplated by the provisions thereof, unless
occasioned by the gross negligence or willful misconduct of
Wachovia."
1.11 AMENDMENT TO ARTICLE XI (MISCELLANEOUS).
(a) AMENDMENT TO SECTION 11.08(C) (ASSIGNMENTS). CLAUSE (I) of
SECTION 11.08(C) is hereby amended by inserting the words "at least"
before the figure "$5,000,000" appearing therein.
1.12 AMENDMENT TO ANNEX C. ANNEX C of the Loan Agreement is
hereby amended to include the dollar amounts of each scheduled reduction
as set forth on ATTACHMENT B attached hereto.
AMENDMENT NO. 10 & LIMITED WAIVER 19
1.13 AMENDMENT TO EXHIBITS. The Exhibits are further amended
by (i) deleting Exhibit R in its entirety and inserting on the Table of
Contents the words "Intentionally Omitted", (ii) inserting new EXHIBIT W
substantially in the form attached hereto as ATTACHMENT D with such
modifications as may be acceptable to the Collateral Agent.
2. LIMITED WAIVERS TO LOAN AGREEMENT.
2.1 PREPAYMENT OF LOANS FROM NET ASSET SALE PROCEEDS RECEIVED
FROM CENTURYTEL ASSET SALE. On the basis of the representations and
warranties contained in, and subject to the terms and conditions of, this
Amendment, Requisite Lenders hereby agree to waive, compliance with the
provisions of SECTIONS 2.08(C), 2.09(C)(III) and 6.03(A)(III) of the Loan
Agreement and Section 4(b), clause (i), of the Seventh Amendment solely to
the extent necessary to permit Borrowers not to apply the Net Asset Sale
Proceeds received by Borrowers on February 28, 2002 in connection with the
CenturyTel Asset Sale to prepay the Loans and permanently reduce the
Revolving Loan Commitment Amount.
2.2 PREPAYMENT OF LOANS FROM ADDITIONAL NOTE BUYBACK. On the
basis of the representations and warranties contained in, and subject to
the terms and conditions of, this Amendment, Requisite Lenders hereby
agree to waive, any Default or Event of Default that may have occurred
solely as a result of Borrowers' failure to comply with the provisions of
Section 2(a), clause (4) of the Seventh Amendment; PROVIDED that on or
before the Tenth Amendment Effective Date, Borrowers shall apply 50% of
the Additional Proceeds Amount (as defined in the Seventh Amendment) to
prepay, subject to SECTION 2.08(D) of the Loan Agreement, the Term Loans
and permanently reduce the Revolving Loan Commitment Amount, each on a pro
rata basis.
2.3 PREPAYMENT OF LOANS FROM SALE OF KMC I-III PORTS. On the
basis of the representations and warranties contained in, and subject to
the terms and conditions of, this Amendment, the Requisite Lenders hereby
agree to waive, compliance with SECTIONS 2.09(C)(III), 6.03(A)(III) and
6.11 of the Loan Agreement solely to the extent necessary to (i) permit
Borrowers to transfer the KMC I-III Ports to a Data Subsidiary
substantially concurrently with the Securitization of the Qwest/MGS
Extension and (ii) permit Borrower not to apply the amounts received by
Borrowers for the sale of the KMC I-III Ports to a Data Subsidiary to
prepay Loans and permanently reduce the Revolving Loan Commitment Amount
pursuant to SECTION 2.09(C)(III). Upon such transfer and receipt of
documentation satisfactory to Collateral Agent, the Collateral Agent shall
release its liens on such KMC I-III Ports.
2.4 SECOND SERIES ADDITIONAL NOTE BUYBACK. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Amendment, the Requisite Lenders hereby agree to
waive:
(a) compliance with the restrictions contained in SECTION 6.09
of the Loan Agreement and clause (i) of the last sentence of Section 2.1 (the
"AUGUST COVENANT") of that certain Limited Waiver to Loan Agreement dated as of
August 30, 2001, solely to the extent necessary to permit Data Holdco to
purchase, in one or a series of purchases, Additional
AMENDMENT NO. 10 & LIMITED WAIVER 20
Purchased Notes (each a "SECOND SERIES ADDITIONAL PURCHASED NOTE" and
collectively, the "SECOND SERIES ADDITIONAL PURCHASED NOTES") on the following
terms and conditions (the "SECOND SERIES ADDITIONAL NOTE BUYBACK"), it being
understood and agreed that any failure by any Loan Party to comply with the
provisions of this Section 2.4(a) shall constitute an immediate Event of Default
under the Loan Agreement;
(1) the aggregate cash paid to purchase the Second Series
Additional Purchased Notes shall not exceed $9,000,000;
(2) the Second Series Additional Purchased Notes shall be
purchased from Persons other than KMC Holdings or any of its Subsidiaries or any
of their respective Affiliates;
(3) the purchase price of each SECOND SERIES ADDITIONAL
PURCHASED Note shall not exceed ten percent (10%) of the Accreted Value (as
defined in such Indenture) of such Second Series Additional Purchased Note
calculated as of the date of such purchase;
(4) to the extent such Second Series Additional Purchased
Notes are not otherwise transferred to a Lender or Lenders as compensation
pursuant to Section 5.30 of the Loan Agreement, as soon as possible and in any
event no later than the first Business Day following the consummation of any
Second Series Additional Note Buyback, Data Holdco shall have transferred
(directly, or indirectly through KMC Holdings) to KMC the related Second Series
Additional Purchased Notes; PROVIDED that such transfer shall be effected
pursuant to documentation in form and substance satisfactory to the Collateral
Agent; and PROVIDED FURTHER that neither KMC nor any other Loan Party shall make
any payment or otherwise incur any obligation to Data Holdco or any other Person
in connection with such transfer (nor shall such transfer be offset against, or
treated as a payment or prepayment of, any amount to become due from any Data
Subsidiary or any such other Person); and
(5) to the extent such Second Series Additional Purchased
Notes are not otherwise transferred to a Lender or Lenders as compensation
pursuant to Section 5.30 of the Loan Agreement, as soon as possible and in any
event no later than five (5) Business Days following the consummation of any
Second Series Additional Note Buyback (which date may be extended in writing by
the Collateral Agent in their sole discretion), (i) KMC shall have pledged the
related Second Series Additional Purchased Notes pursuant to the terms of that
certain Pledge Agreement dated as of December 22, 1998 (as amended through the
dated hereof and as it may be further amended, restated, supplemented or
otherwise modified from time to time, the "KMC PLEDGE AGREEMENT") between KMC
and the Collateral Agent, including, without limitation, by delivering to the
Agents executed counterparts of the Pledge Supplement to the KMC Pledge
Agreement duly executed by KMC and (ii) KMC shall have executed and delivered to
the Agent and Collateral Agent an amendment to the Account Control Agreement
dated as of November 8, 2001, as amended, among KMC, Collateral Agent and First
Union National Bank, as Securities Intermediary, modifying the definition of
Eligible Investments appearing therein to include the Second Series Additional
Purchased Notes, such amendment to be in form and substance acceptable to the
Collateral Agent;
AMENDMENT NO. 10 & LIMITED WAIVER 21
(b) compliance with the restrictions contained in SECTION 6.07
of the Loan Agreement solely to the extent necessary to permit KMC to own the
Second Series Additional Purchased Notes, or hold such notes registered in its
name; and
(c) compliance with the restrictions contained in SECTIONS
6.09 and 6.11 of the Loan Agreement and the August Covenant solely to the extent
necessary to permit Data Holdco to transfer (directly, or indirectly through KMC
Holdings) to KMC all or a portion of the Second Series Additional Purchased
Notes.
2.5 MERGER OF LEASING I, LEASING II AND LEASING III. The
Borrowers have advised the Lenders that Leasing II and Leasing III will be
merged with and into Leasing I which will be the surviving entity (the
"LEASING MERGER") or Leasing II and Leasing III will be liquidated (the
"LEASING LIQUIDATION"). On the basis of the representations and warranties
contained in, and subject to the terms and conditions of, this Amendment,
Requisite Lenders hereby agree to waive, for one time only, compliance
with the provisions of SECTIONS 6.03(A)(I) (requiring, among other things,
that the applicable Borrower provide the Agent with thirty (30) days prior
written notice to the Agent prior to consummating a merger with another
Borrower) solely to the extent necessary to permit Leasing I, Leasing II
and Leasing III to consummate the Leasing Merger or the Leasing
Liquidation, PROVIDED that on or before the Leasing Merger or Leasing
Liquidation, the Loan Parties shall have delivered the agreements to be
entered into by and among Leasing I, Leasing II and Leasing III and
pursuant to which the Leasing Merger or Leasing Liquidation shall be
consummated, together with any other documents and instruments executed in
connection therewith, all in form and substance satisfactory to the
Requisite Lenders in their sole discretion (collectively, the "LEASING
RESTRUCTURING AGREEMENTS").
2.6 PRE-PAID EXPENSE. On the basis of the representations and
warranties contained in, and subject to the terms and conditions of, this
Amendment, the Requisite Lenders hereby agree to waive, any Default or
Event of Default which may have occurred pursuant to Section 9.01(b) of
the Loan Agreement solely as a result of Borrowers' failure to comply with
the provisions of SECTIONS 6.11 and 6.13 of the Loan Agreement by
permitting KMC Holdings to account for the $200,000,000 payment made by
Data Holdco to KMC Holdings on or about the Fourth Amendment Effective
Date as a prepaid expense; PROVIDED that on or before the Tenth Amendment
Effective Date, (i) KMC Holdings shall execute in favor of Data Holdco a
subordinated intercompany note in the principal amount of $152,495,848
substantially in the form of ATTACHMENT F annexed hereto (the "DATA HOLDCO
NOTE") evidencing such pre-paid expense, (ii) Data Holdco shall pledge the
Data Holdco Note to the Collateral Agent for the benefit of Agents and
Lenders, as Collateral for the Obligations, by executing in favor of
Collateral Agent a Pledge Agreement substantially in the form of
ATTACHMENT G hereto (the "DATA HOLDCO PLEDGE AGREEMENT") and delivering
the Data Holdco Note to Collateral Agent, duly endorsed in blank by Data
Holdco and (iii) in no event shall any amounts owing by Data Holdco or any
Data Subsidiary to any Loan Party be permitted to be offset against or
treated as a payment or prepayment of any amounts owing under the Data
Holdco Note or such prepaid expense.
AMENDMENT NO. 10 & LIMITED WAIVER 22
2.7 $739,013,300 INTERCOMPANY LOAN. On the basis of the
representations and warranties contained in this Amendment, and subject to
the terms and conditions of this Amendment, the Requisite Lenders hereby
agree to waive any Default or Event of Default which may have occurred
under SECTION 9.01(B) of the Loan Agreement solely as a result of the
existence prior to the Tenth Amendment Effective Date of any intercompany
loans owed by KMC to KMC Holdings in violation of SECTIONS 6.11 and 6.13
of the Loan Agreement; PROVIDED that on or before the Tenth Amendment
Effective Date the Agent shall have received a balance sheet as of January
31, 2002 reflecting that all such intercompany Indebtedness has been
converted to equity.
2.8 KNT. On the basis of the representations and warranties
contained in this Amendment, and subject to the terms and conditions of
this Amendment, the Requisite Lenders hereby agree to waive any Defaults
or Events of Default which may have occurred under SECTIONS 9.01(B) of the
Loan Agreement solely as a result of the Borrowers' failure to submit to
Agent and Lenders a proposal in form and substance satisfactory to Agents
and Required Lenders pursuant to SECTION 5.23 of the Loan Agreement;
PROVIDED that the waiver set forth in this Section 2.8 shall cease to be
of any force or effect on July 1, 2003 or upon the occurrence of an Event
of Default, whichever is earlier; PROVIDED FURTHER that the Lenders hereby
otherwise reserve all rights with respect to such Defaults or Events of
Default as set forth in Section 4.2 of this Amendment.
2.9 DEFERRAL OF CERTAIN PAYMENTS. On the basis of the
representations and warranties contained in this Amendment, certain
Lenders (the "DEFERRING LENDERS") have agreed or may agree (as described
in Section 5.30) to the deferral (the "DEFERRAL") until the earlier of
June 30, 2003 and the occurrence of an Event of Default (such earlier date
being the "DEFERRAL TERMINATION DATE") of the payment of their respective
pro rata shares of the following amounts (collectively, the "DEFERRED
AMOUNTS"): (i) the installments of principal of the Loans scheduled to be
paid on April 1, 2003 (the "DEFERRAL DATE") and (ii) any mandatory
prepayments of principal on the Revolving Loans which may be due on the
Deferral Date under Section 2.09 (d) (i) in connection with the Revolving
Loan Commitment Amount reduction scheduled for the Deferral Date under
Section 2.09 (c) (ix) and Annex C (PROVIDED that such Deferring Lenders'
Revolving Loan Commitment Amounts SHALL be reduced on the Deferral Date as
set forth in Annex C). The Agent is hereby directed to apply any payments
it shall receive with respect to the Deferred Amounts (unless the
Deferring Lenders notify the Agent that the Deferral has been terminated)
to the balance of the Loans held by the Lenders other than the Deferring
Lenders. The parties hereto acknowledge that the above Deferral shall
terminate on the Deferral Termination Date, and hereby consent to the
payment of such Deferred Amounts to the Deferring Lenders on the Deferral
Termination Date. The Deferring Lenders shall deliver a letter of deferral
to the Agent setting forth the above terms.
3. LIMITATION OF WAIVER. Without limiting the generality of
the provisions of Section 11.02(b) of the Loan Agreement, the waivers set forth
above shall be limited precisely as written and relate solely to noncompliance
by the Borrowers with the provisions of Sections 2.08(c), 2.09(c)(iii), 5.23,
6.03(a)(i), 6.03(a)(iii), 6.07, 6.09, 6.11, 6.13 and 9.01(b) of the Loan
AMENDMENT NO. 10 & LIMITED WAIVER 23
Agreement, the August Covenant and Section 4(b), clause (i), of the Seventh
Amendment in the manner and to the extent described above and nothing in this
Amendment shall be deemed to:
(a) constitute a waiver of compliance by the Borrowers with
respect to (i) SECTIONS 2.08(C), 2.09(C)(III), 5.23, 6.03(A)(I), 6.03(A)(III),
6.07, 6.09, 6.11, 6.13 and 9.01(B) of the Loan Agreement, the August Covenant
and Section 4(b), clause (i), of the Seventh Amendment in any other instance or
(ii) any other term, provision or condition of the Loan Agreement or any other
instrument or agreement referred to therein; or
(b) prejudice any right or remedy that the Agents or any
Lender may now have (except to the extent such right or remedy was based upon
existing defaults that will not exist after giving effect to this Amendment) or
may have in the future under or in connection with the Loan Agreement or any
other instrument or agreement referred to therein.
Except as expressly set forth herein, the terms, provisions
and conditions of the Loan Agreement and the other Loan Documents shall remain
in full force and effect and in all other respects are hereby ratified and
confirmed.
4. RESERVATION OF RIGHTS; RELEASE OF CLAIMS.
4.1 RESERVATION OF RIGHTS. The Agents, on behalf of the
Lenders, have not, as of the date hereof, exercised their rights and
remedies under the Loan Agreement and the other Loan Documents with
respect to any Default or Event of Default referenced in Section 2.8
hereof. Although the Agents, on behalf of the Lenders, have not as of the
date hereof, exercised with respect to any such Default or Event of
Default any of the rights, remedies, powers and privileges of the Agents
and/or the Lenders under the Loan Agreement and the other Loan Documents,
such non-exercise and any future non-exercise of any rights, remedies,
powers and privileges by any of the Agents or Lenders with respect to any
Default or Event of Default (whether now existing or hereafter occurring),
shall not in any manner be deemed or construed as a waiver thereof except
as expressly provided herein. With respect to such Defaults and Events of
Default referenced in Section 2.8, each of the Agents, on behalf of the
Lenders, hereby reserves its rights to exercise, without further notice to
Borrowers or any other Loan Party, any and all rights, remedies, powers,
privileges of each such Agent on behalf of the Lenders, under the Loan
Agreement, as such Agent deems appropriate in respect of any such Defaults
or Events of Defaults, at any time after the earlier to occur of an Event
of Default or July 1, 2003. The Agents and Lenders hereby reserve and
preserve all of their respective rights and remedies under the Loan
Agreement, the other Loan Documents and applicable law, and the Agents'
and Lenders' voluntary action or inaction, if any, from exercising any of
such rights or remedies is not intended (and should not be construed),
except as expressly provided in Section 2.8 hereof, as a waiver of such
Defaults and Events of Default or a waiver of its rights and remedies with
respect to them.
4.2 RELEASE AND DISCHARGE OF CLAIMS AND ACTIONS. TO INDUCE THE
AGENTS AND THE LENDERS TO ENTER INTO THIS AMENDMENT, EACH BORROWER AND
EACH GUARANTOR ON BEHALF OF ITSELF AND EACH OF ITS SUBSIDIARIES AND
AFFILIATES EACH HEREBY KNOWINGLY,
AMENDMENT NO. 10 & LIMITED WAIVER 24
VOLUNTARILY, INTENTIONALLY AND IRREVOCABLY RELEASES, ACQUITS AND FOREVER
DISCHARGES EACH OF THE AGENTS AND EACH LENDER AND THEIR RESPECTIVE
OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL
LIABILITIES, CLAIMS, DEMANDS, ACTIONS OR CAUSES OF ACTION OF ANY KIND (IF
ANY THERE BE), WHETHER ABSOLUTE OR CONTINGENT, DUE OR TO BECOME DUE,
DISPUTED OR UNDISPUTED, AT LAW OR IN EQUITY, THAT ANY BORROWER OR ANY
GUARANTOR NOW HAVE OR EVER HAD AGAINST ANY AGENTS OR LENDER ARISING UNDER,
BASED UPON OR IN CONNECTION WITH THE LOAN AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY BY REASON OF ANY
MATTER, CAUSE OR THING WHATSOEVER FROM THE BEGINNING OF THE WORLD TO AND
INCLUDING THE TENTH AMENDMENT EFFECTIVE DATE.
4.3 RELEASE OF COLLATERAL. Requisite Lenders hereby consent
pursuant to Section 10.08(a) of the Loan Agreement to the release of up to
$43,000,000 [face value] of Purchased Notes to be transferred, in
accordance with Section 5.30 and direct the Collateral Agent to take all
such action as may be necessary to effect the foregoing.
5. CONDITIONS PRECEDENT. This Amendment shall become effective
as of the date above written (the "TENTH AMENDMENT EFFECTIVE DATE"), if, and
only if, the following conditions are satisfied or waived in writing BY
Requisite Lenders:
(a) the Agent shall have received the following items:
(1) this Amendment duly executed by the appropriate parties,
(2) a Reaffirmation of Guaranty in the form of ATTACHMENT H
annexed hereto duly executed by KMC Holdings, KMC I Services LLC, KMC II
Services LLC, Data Holdco, KMC Financing, KMC Financial Services, Holdings IV,
KMC IV, KMC IV Services LLC, KMC Telecom Leasing IV LLC and KMC Telecom IV of
Virginia, Inc.
(3) a Collateral Assignment of Option Agreements duly executed
by the applicable Borrower and in form and substance satisfactory to Collateral
Agent;
(4) an Amendment No. 2 to Pledge Agreement in the form
acceptable to the Collateral Agent providing for the present right to vote the
Pledged Notes, duly executed by KMC (the "KMC PLEDGE AMENDMENT");
(5) evidence that such all intercompany Indebtedness owed by
KMC to KMC Holdings has been converted to equity pursuant to documentation in
form and substance satisfactory to the Collateral Agent;
(6) the written opinion of special counsel for the Borrowers
and KMC Holdings, addressed to the Agent, the Collateral Agent and the Lenders
satisfactory to (and containing only such qualifications and limitations as are
satisfactory to) Requisite Lenders, with opinion as to, among other things, (i)
the enforceability of the Tenth Amendment, the Loan
AMENDMENT NO. 10 & LIMITED WAIVER 25
Agreement as amended by the Tenth Amendment, the KMC Pledge Amendment, and any
other security documents executed in connection with the Tenth Amendment, (ii)
the perfection of any liens granted on the Tenth Amendment Effective Date, (iii)
the creation and perfection of liens in the securities accounts, (iv) no
conflicts with applicable laws or contractual obligations, and (v) the due
authorization, execution and delivery of the Tenth Amendment and the other Loan
Documents to be delivered on the Tenth Amendment Effective Date;
(7) certificates, of the secretary or assistant secretary or
the sole member, as the case may be, of each of the Borrowers, KMC Holdings and
Data Holdco, certifying (i) that the articles of organization or certificate of
formation or other equivalent, and the bylaws or operating agreement or other
equivalent, of each such Loan Party have not changed since last delivered, (ii)
that attached thereto are true and complete copies of (x) resolutions duly
adopted by the Board of Directors or sole member, as the case may be, of such
Loan Party authorizing the execution, delivery and performance of the Tenth
Amendment and such other documents, instruments or certificate executed in
connection therewith (collectively, the "TENTH AMENDMENT DOCUMENTATION") to
which it is a party and (y) certificates of good standing from the jurisdiction
of incorporation or organization of such Loan Party, and to the extent requested
by the Agent and Collateral Agent, from jurisdictions where authorized to do
business, each dated a recent date prior to the Tenth Amendment Effective Date
and certified by the applicable Secretary of State or other Governmental
Authority, (iii) the names and true signatures of the officers authorized to
sign the Tenth Amendment Documentation to which such Loan Party is a party;
(8) a detailed description of all equipment and other assets
of KMC VII and evidence that such equipment and assets shall have been
transferred to a Borrower and pledged to the Collateral Agent as additional
Collateral for the Obligations;
(9) the Data Holdco Note, duly executed by KMC Holdings and
endorsed in blank by Data Holdco; and
(10) the Data Holdco Pledge Agreement, duly executed by Data
Holdco and Collateral Agent.
(b) the Collateral Agent shall have received evidence
satisfactory to the Collateral Agent that the Collateral Agent's security
interests in the Collateral have been properly perfected and constitute first
and prior security interests subject only to Permitted Liens, including by (A)
filing Mortgages, the Collateral Assignment of Licenses, the Collateral
Assignment of Leases, leasehold mortgages and UCC-1 financing statements
(including, without limitation, fixture filings) in certain filing and recording
offices and (C) taking possession of stock certificates and other instruments,
in each case, as requested by the Collateral Agent;
(c) the Agents shall have received evidence that ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, his Equity Affiliates, Nassau Capital Partners L.P., and NAS Partners I
L.L.C. shall have agreed to either defer their right to receive interest
payments on the notes issued pursuant to the Indentures or contribute such
payments as equity to KMC Holdings, in each case pursuant to documentation in
form and substance satisfactory to the Requisite Lenders.
AMENDMENT NO. 10 & LIMITED WAIVER 26
(d) the Collateral Agent shall have received a completed
Perfection Certificate signed by the chief financial officer of KMC Holdings in
form and substance acceptable to the Collateral Agent;
(e) all outstanding and invoiced fees and expenses of Agents
and Lenders shall have been paid in full, including fees and expenses of
PriceWaterhouseCoopers and counsel to Lenders; and
(f) the Requisite Lenders shall have received such other
documents, agreements and instruments as they may reasonably require.
6. REPRESENTATIONS AND WARRANTIES OF THE BORROWERS. In order
to induce the Lenders to enter into this Amendment in the manner provided
herein, each Borrower hereby represents and warrants, as to each Borrower or
each Loan Party, as the case may be, that after giving effect to this Amendment:
(a) AUTHORIZATION OF AGREEMENTS; BINDING OBLIGATIONS. The
execution and delivery of this Amendment and the performance of the Loan
Agreement as amended by this Amendment (as so amended, the "AMENDED AGREEMENT")
have been duly authorized by all necessary corporate action on the part of such
Borrower and constitute the legal, valid and binding obligations of such
Borrower, enforceable against such Borrower in accordance with their respective
terms except as may be limited by bankruptcy, insolvency reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.
(b) CORPORATE POWER AND AUTHORITY. Such Borrower has all
requisite corporate power and authority to enter into this Amendment, and such
Loan Party has all requisite corporate power and authority to carry out the
transactions contemplated by, and perform its obligations under, the Loan
Agreement, as amended by this Amendment.
(c) NO CONFLICT. The execution and delivery by such Borrower
of this Amendment and the performance by such Borrower of the Amended Agreement
do not and will not (i) violate any provision of any law or any governmental
rule or regulation applicable such Borrower, the Certificate or Articles of
Incorporation or Bylaws (or comparable organizational documents) of such
Borrower or any order, judgment or decree of any court or other agency or
government binding on such Borrower, (ii) conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
contractual obligation of such Borrower, (iii) result in or require the creation
or imposition of any Lien upon any of the properties or assets of such Borrower
(other than Liens created under any of the Loan Documents in favor of the
Collateral Agent on behalf of Lenders), or (iv) require any approval of
stockholders or any approval or consent of any Person under any contractual
obligation of such Borrower.
(d) GOVERNMENT CONSENTS. The execution and delivery by such
Borrower of this Amendment and the performance by such Borrower of the Amended
Agreement do not and will not require any registration with, consent or approval
of or notice to, or other action to, with or by, any multi-national, federal,
provincial, state, municipal, local or other governmental authority or
regulatory body.
AMENDMENT NO. 10 & LIMITED WAIVER 27
(e) ABSENCE OF DEFAULTS. As of the date hereof, and after
giving effect to this Amendment, such Borrower shall be in compliance with all
the terms and provisions set forth in the Amended Agreement on its part to be
observed or performed, and no Event of Default or Default shall have occurred
and be continuing
(f) REAFFIRMATION. Upon the effectiveness of this Amendment,
such Borrower hereby reaffirms all representations and warranties made in the
Loan Agreement, and to the extent the same are not amended hereby, agrees that
all such representations and warranties shall be deemed to have been remade as
of the date of delivery of this Amendment, unless and to the extent that any
such representation and warranty is stated to relate solely to an earlier date,
in which case such representation and warranty shall be true and correct as of
such earlier date.
7. REFERENCE TO AND EFFECT ON THE LOAN AGREEMENT.
(a) Upon the effectiveness of Section 1 hereof, on and after
the date hereof, each reference in the Loan Agreement to "this Loan Agreement,"
"this Agreement," "hereunder," "hereof," "herein" or words of like import shall
mean and be a reference to the Loan Agreement as amended hereby, and each
reference to the Loan Agreement in any other document, instrument or agreement
shall mean and be a reference to the Loan Agreement as amended hereby.
(b) The Loan Agreement, as amended hereby, and all other
documents, instruments and agreements executed and/or delivered in connection
therewith, shall remain in full force and effect, and are hereby ratified and
confirmed.
(c) Except as expressly provided herein, the execution,
delivery and effectiveness of this Amendment shall not operate as a waiver of
any right, power or remedy of the Agents or the Lenders, nor constitute a waiver
of any provision of the Loan Agreement or any other documents, instruments and
agreements executed and/or delivered in connection therewith.
8. FEES AND EXPENSES. Each Borrower acknowledges and agrees
that all costs, fees and expenses as described in Section 11.04 of the Loan
Agreement incurred by Agents, Lenders and their respective counsel with respect
to this Amendment and the documents and transactions contemplated hereby shall
be for the account of the Borrowers.
9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE OTHER REMAINING TERMS OF THE LOAN AGREEMENT AND
THE INTERNAL LAWS (AS OPPOSED TO CONFLICT OF LAW PROVISIONS) OF THE STATE OF NEW
YORK.
10. PARAGRAPH HEADINGS. The paragraph headings contained in
this Amendment are and shall be without substance, meaning or content of any
kind whatsoever and are not a part of the agreement among the parties thereto.
AMENDMENT NO. 10 & LIMITED WAIVER 28
11. COUNTERPARTS. This Amendment may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
AMENDMENT NO. 10 & LIMITED WAIVER 29
IN WITNESS WHEREOF, this Amendment has been duly executed as
of the day and year first above written.
THE BORROWERS:
KMC TELECOM LLC (f/k/a KMC TELECOM
INC.)
KMC TELECOM II LLC (f/k/a KMC TELECOM
II, INC.)
KMC TELECOM III LLC (f/k/a KMC TELECOM
III, INC.)
KMC TELECOM OF VIRGINIA, INC.
KMC ▇▇▇▇▇▇▇.▇▇▇, INC.
In each case:
By:/S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
KMC TELECOM LEASING I LLC
By: KMC TELECOM INC., as its Sole Member
By:/S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
KMC TELECOM LEASING II LLC
By: KMC TELECOM II, INC., as its Sole Member
By:/S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
AMENDMENT NO. 10 & LIMITED WAIVER S-1
KMC TELECOM LEASING III LLC
KMC III SERVICES LLC
In each case:
By: KMC TELECOM III, INC., as Sole Member
By:/S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
WACHOVIA BANK, NATIONAL
ASSOCIATION (f/k/a FIRST UNION NATIONAL
BANK), as the Agent and as a Lender
By:
------------------------
Name:
Title:
CIT LENDING SERVICES CORPORATION
(f/k/a NEWCOURT COMMERCIAL FINANCE
CORPORATION), as the Collateral Agent and as a
Lender
By:/S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
CANADIAN IMPERIAL BANK OF
COMMERCE, as a Lender
By:
------------------------
Name:
Title:
AMENDMENT NO. 10 & LIMITED WAIVER S-2
GENERAL ELECTRIC CAPITAL
CORPORATION, as a Lender
By:/S/ ▇▇▇▇▇ ▇. ▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Manager-Operations
LT HOLDCO II LLC, as a Lender
By: SFG XVI, Inc., its Manager
By:/S/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
CREDIT SUISSE FIRST BOSTON, as a Lender
By:/S/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director
By:/S/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director
DRESDNER BANK AG NEW YORK AND
GRAND CAYMAN BRANCHES, as a Lender
By:
------------------------
Name:
Title:
By:
------------------------
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.,
as a Lender
By:
------------------------
Name:
Title:
AMENDMENT NO. 10 & LIMITED WAIVER S-3
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ PRIME
INCOME TRUST, as a Lender
By:
------------------------
Name:
Title:
UNION BANK OF CALIFORNIA, N.A., as a
Lender
By:
------------------------
Name:
Title:
▇▇▇▇▇ ▇▇▇ & FARNHAM INCORPORATED
as agent for KEYPORT LIFE INSURANCE
COMPANY, as a Lender
By:
------------------------
Name:
Title:
▇▇▇▇▇ ▇▇▇ FLOATING RATE LIMITED
LIABILITY COMPANY, as a Lender
By:
------------------------
Name:
Title:
IBM CREDIT CORPORATION, as a Lender
By:
------------------------
Name:
Title:
AMENDMENT NO. 10 & LIMITED WAIVER S-4
WACHOVIA BANK, NATIONAL ASSOCIATION
(f/k/a FIRST UNION NATIONAL BANK), as the Agent
By:/S/ ▇.▇. ▇▇▇▇▇▇▇
------------------------
Name: ▇.▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
AMENDMENT ▇▇. ▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇-▇
▇▇▇▇▇▇▇▇▇▇ ▇
TO TENTH AMENDMENT
ANNEX C
REVOLVING LOAN COMMITMENT AMOUNT REDUCTIONS
-------------------------------------------
PERCENTAGE REDUCTION OF
-----------------------
INITIAL REVOLVING LOAN
----------------------
PAYMENT DATE COMMITMENT REDUCTION AMOUNT
------------ ---------- ----------------
April 1, 2003 5.00% $8,750,000
July 1, 2003 3.75% $6,562,500
October 1, 2003 3.75% $6,562,500
January 1, 2004 3.75% $6,562,500
April 1, 2004 3.75% $6,562,500
July 1, 2004 6.25% $10,937,500
October 1, 2004 6.25% $10,937,500
January 1, 2005 6.25% $10,937,500
April 1, 2005 6.25% $10,937,500
July 1, 2005 6.25% $10,937,500
October 1, 2005 6.25% $10,937,500
January 1, 2006 6.25% $10,937,500
April 1, 2006 6.25% $10,937,500
July 1, 2006 7.50% $13,125,000
October 1, 2006 7.50% $13,125,000
January 1, 2007 7.50% $13,125,000
AMENDMENT ▇▇. ▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇-▇
▇▇▇▇▇ ▇, ▇▇▇▇ 7.50% $13,125,000
TOTAL 100% 175,000,000
AMENDMENT NO. 10 & LIMITED WAIVER S-2
TERM A LOAN REDUCTIONS
----------------------
Percentage of Initial
Principal Amount of Term
A Loans
PAYMENT DATE TO BE REPAID Reduction Amount
------------ ------------
April 1, 2003 5.00% $3,750,000
July 1, 2003 3.75% $2,812,500
October 1, 2003 3.75% $2,812,500
January 1, 2004 3.75% $2,812,500
April 1, 2004 3.75% $2,812,500
July 1, 2004 6.25% $4,687,500
October 1, 2004 6.25% $4,687,500
January 1, 2005 6.25% $4,687,500
April 1, 2005 6.25% $4,687,500
July 1, 2005 6.25% $4,687,500
October 1, 2005 6.25% $4,687,500
January 1, 2006 6.25% $4,687,500
April 1, 2006 6.25% $4,687,500
July 1, 2006 7.50% $5,625,000
October 1, 2006 7.50% $5,625,000
January 1, 2007 7.50% $5,625,000
April 1, 2007 7.50% $5,625,000
TOTAL 100% $75,000,000
AMENDMENT ▇▇. ▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇-▇
▇▇▇▇ ▇ LOAN REDUCTIONS
----------------------
Percentage of Principal
Amount of Term B Loans
PAYMENT DATE TO BE REPAID REDUCTION AMOUNT
------------ ------------ ----------------
April 1, 2003 5.00% $20,997,005
July 1, 2003 3.75% $15,747,754
October 1, 2003 3.75% $15,747,754
January 1, 2004 3.75% $15,747,754
April 1, 2004 3.75% $15,747,754
July 1, 2004 6.25% $26,246,257
October 1, 2004 6.25% $26,246,257
January 1, 2005 6.25% $26,246,257
April 1, 2005 6.25% $26,246,257
July 1, 2005 6.25% $26,246,257
October 1, 2005 6.25% $26,246,257
January 1, 2006 6.25% $26,246,257
April 1, 2006 6.25% $26,246,257
July 1, 2006 7.50% $31,495,508
October 1, 2006 7.50% $31,495,508
January 1, 2007 7.50% $31,495,508
April 1, 2007 7.50% $31,495,508
TOTAL 100% $419,940,109
AMENDMENT NO. 10 & LIMITED WAIVER S-4
ATTACHMENT D
TO TENTH AMENDMENT
REQUEST FOR COLLATERAL ACCOUNT RELEASE
To: CIT Lending Services Corporation
(f/k/a Newcourt Commercial Finance Corporation),
as Collateral Agent
▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President Credit-Communications
& Media Finance Group
Reference: KMC
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
Wachovia Bank, National Association
(f/k/a First Union National Bank)
as Administrative Agent
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: 704-715-8008
Dated: ____________, 200[ ]
Ladies and Gentlemen:
The undersigned, KMC Telecom LLC (f/k/a KMC Telecom Inc.), a
Delaware limited liability company, KMC Telecom II LLC (f/k/a KMC Telecom II,
Inc.), a Delaware limited liability company, KMC Telecom III LLC (f/k/a KMC
Telecom III, Inc.), a Delaware limited liability company, KMC Telecom of
Virginia, Inc., a Virginia public service company, KMC Telecom Leasing I LLC, a
Delaware limited liability company, KMC Telecom Leasing II LLC, a Delaware
limited liability company, KMC Telecom Leasing III LLC, a Delaware limited
liability company, KMC ▇▇▇▇▇▇▇.▇▇▇, Inc., a Delaware corporation, and KMC III
Services LLC, a Delaware limited liability company, and the "Additional
Borrowers" signatory thereto from time to time (collectively, the "Borrowers"),
refer to that certain Amended and Restated Loan and Security Agreement dated as
of February 15, 2000, among the Borrowers, the financial institutions signatory
thereto from time to time (the "Lenders"), Wachovia Bank, National Association
(f/k/a First Union National Bank), as administrative agent for the Lenders (the
"Agent") and CIT Lending Services Corporation (f/k/a Newcourt Commercial Finance
Corporation), as collateral agent for the Lenders (the "Collateral Agent";
together with the Agent,
the "Agents"), as amended by that certain Amendment No. 1 dated as of March 28,
2000 ("AMENDMENT NO. 1"), Amendment No. 2 dated as of July 28, 2000 ("AMENDMENT
NO. 2"), Amendment No. 3 and Limited Waiver dated as of February 23, 2001
("AMENDMENT NO. 3"), Amendment No. 4 dated as of April 12, 2001 ("AMENDMENT NO.
4"), Amendment No. 5 dated as of July 16, 2001, Amendment No. 6 and Limited
Waiver dated as of January 31, 2002 ("AMENDMENT NO. 6"), Amendment No. 7,Limited
Waiver and Consent dated as of February 20, 2002 ("AMENDMENT NO. 7"), Amendment
No. 8 and Extension of Limited Waiver dated as of March 28, 2002 Amendment No. 9
and Extension of Limited Waiver dated as of April 15, 2002, and Amendment No. 10
and Limited Waiver dated as of May __, 2002 ("AMENDMENT NO. 10"; together with
the Loan Agreement, Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, Amendment
▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, and
Amendment No. 9, the "AMENDED LOAN AGREEMENT"). Undefined, capitalized terms
used herein shall have the meanings assigned thereto in the Amended Loan
Agreement.
KMC Telecom II LLC hereby requests that the Agent release
certain funds held in Account No. ▇▇▇▇▇▇▇▇ of KMC Telecom II LLC maintained with
Wachovia Bank, National Association (the "PROPOSED RELEASE") pursuant to Section
5.29 of the Amended Loan Agreement:
(i) The amount of the Proposed Release is
$[______________________________].
(ii) The Business Day of the Proposed Release is ___________
___, _____.
(iii) The proceeds of the Proposed Release which uses are in
conformance with the Business Plan are to be used for the purposes as specified
on Schedule A attached, hereto.
(iv) The bank account into which the proceeds of the Proposed
Release are to be transferred is account no. [____________] maintained at
[___________________________].
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the Business Day of the
Proposed Release:
(A) The representations and warranties contained in Article
III of the Amended Loan Agreement are correct in all respects, before and after
giving effect to the Proposed Release and to the application of the proceeds
therefrom, as though made on as of such date;
(B) No event has occurred and is continuing, or would result
from such Proposed Release or from the application of the proceeds therefrom,
which constitutes either an Event of Default or an event which but for the
requirement that notice be given and/or the elapse of time, would constitute an
Event of Default;
(C) All agreements and all conditions to the Proposed Release
contained in Section 5.29(a)-(c) of the Amended Loan Agreement, including
without limitation those
2
conditions set forth in Section 4.02 applicable to a Collateral Account Release,
which are required to be performed or satisfied by KMC Telecom II LLC on the
date hereof or by the Business Day of the Proposed Release have been and will be
performed and satisfied; and
(D) Attached hereto as Exhibit 1 is an officer's certificate
of the chief financial officer of KMC Telecom Holdings, Inc. as required by
Section 4.02(n) of the Amended Loan Agreement.
3
Very truly yours,
KMC TELECOM II LLC (f/k/a KMC TELECOM
II, INC.)
By:
------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
Acknowledged and agreed
this _________ day of May:
WACHOVIA BANK, NATIONAL ASSOCIATION
(f/k/a First Union National Bank), as the Agent
By:
------------------------
Name:
Title:
CIT LENDING SERVICES CORPORATION
(f/k/a NEWCOURT COMMERCIAL FINANCE
CORPORATION), as the Collateral Agent and as a Lender
By:
------------------------
Name:
Title:
4
SCHEDULE A
TO
REQUEST FOR COLLATERAL ACCOUNT RELEASE
DESCRIPTION OF THE PURPOSES FOR WHICH THE PROCEEDS
OF THE PROPOSED RELEASE WILL BE USED
[If the proceeds of the Proposed Release will be used to purchase or reimburse
any Borrower for Telecommunications Equipment, a schedule supporting one hundred
percent (100%) of Telecommunications Equipment requested to be funded shall be
delivered to the Collateral Agent. Such schedule will detail all invoices for
equipment, third party labor, permits, other third party costs and all
capitalized internal costs of the Borrowers with respect to such
Telecommunications Equipment permitted under GAAP. All invoices over $25,000
will be attached to such schedule, delivered to the Collateral Agent, who shall
review such invoices and verify that, when combined with the above described
capitalized internal costs, such invoices will support at least seventy percent
(70%) of the total requested funding. Additionally, any schedules to the Loan
Agreement which, as of the date of such Proposed Release, require modification,
shall be supplemented and delivered to the Agent.
[If the proceeds of the Proposed Release will be used to pay or reimburse for
transaction costs, a copy of the invoice from the provider of the service or
other appropriate supporting documentation must be included for the Collateral
Agent.]
[If the proceeds of the Proposed Release will be used for working capital or
other general corporate purposes, a certificate will be required to be delivered
to the Collateral Agent verifying that the making of the Proposed Release does
not violate any provision of the Indentures.]
EXHIBIT 1 TO FORM OF REQUEST FOR COLLATERAL ACCOUNT RELEASE
[FORM OF OFFICER'S CERTIFICATE]
KMC TELECOM HOLDINGS, INC.
OFFICER'S CERTIFICATE
---------------------
This Certificate is furnished to the Agents (as defined below)
pursuant to Section 4.02(n) of that certain Amended and Restated Loan and
Security Agreement, dated as of February 15, 2000, among KMC TELECOM LLC, a
Delaware limited liability company (f/k/a KMC TELECOM INC., a Delaware
corporation) ("KMC"), KMC TELECOM II LLC, a Delaware limited liability company
(f/k/a KMC TELECOM II, INC., a Delaware corporation) ("KMC II"), KMC TELECOM III
LLC, a Delaware limited liability company (f/k/a KMC TELECOM III, INC., a
Delaware corporation) ("KMC III"), KMC TELECOM OF VIRGINIA, INC., a Virginia
public service company ("KMC VIRGINIA"), KMC TELECOM LEASING I LLC, a Delaware
limited liability company ("LEASING I"), KMC TELECOM LEASING II LLC, a Delaware
limited liability company ("LEASING II"), KMC TELECOM LEASING III LLC, a
Delaware limited liability company ("LEASING III"), KMC ▇▇▇▇▇▇▇.▇▇▇, INC., a
Delaware corporation ("▇▇▇▇▇▇▇.▇▇▇"), KMC III SERVICES LLC, a Delaware limited
liability company ("SERVICES"; KMC, KMC II, KMC III, KMC Virginia, Leasing I ,
Leasing II, Leasing III, ▇▇▇▇▇▇▇.▇▇▇ and Services being hereinafter collectively
referred to hereinafter as the "BORROWERS"), the "Lenders" party hereto, FIRST
UNION NATIONAL BANK, as administrative agent for the Lenders (the "AGENT") and
CIT LENDING SERVICES CORPORATION (f/k/a NEWCOURT COMMERCIAL FINANCE
CORPORATION), as collateral agent for the Lenders (the "COLLATERAL AGENT";
together with the Agent, the "Agents") (as amended pursuant to that certain
Amendment No. 1 dated as of March 28, 2000 ("AMENDMENT NO. 1"), Amendment No. 2
dated as of July 28, 2000 ("AMENDMENT NO. 2"), Amendment No. 3 and Limited
Waiver dated as of February 23, 2001 ("AMENDMENT NO. 3"), Amendment No. 4 dated
as of April 12, 2001 ("AMENDMENT NO. 4"), Amendment No. 5 dated as of July 16,
2001, Amendment No. 6 and Limited Waiver dated as of January 31, 2002
("AMENDMENT NO. 6"), Amendment No. 7, Limited Waiver and Consent dated as of
February 20, 2002 ("AMENDMENT NO. 7"), Amendment No. 8 and Extension of Limited
Waiver dated as of March 28, 2002 ("AMENDMENT NO. 8"), Amendment No. 9 and
Extension of Limited Waiver dated as of April 15, 2002 ("AMENDMENT NO. 9"), and
Amendment No. 10 and Limited Waiver dated as of May __, 2002 ("AMENDMENT NO.
10"; together with the Loan Agreement, Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇,
▇▇▇▇▇▇▇▇▇ ▇▇. ▇, Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, Amendment
▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, and Amendment No. 9, the "AMENDED LOAN AGREEMENT").
Undefined, capitalized terms used herein shall have the meanings assigned
thereto in the Amended Loan Agreement.
Capitalized terms not otherwise defined herein shall have the
meanings given to such terms in the Amended Loan Agreement.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ hereby certifies that he is the duly
elected, qualified and acting Executive Vice President and Chief Financial
Officer of KMC Telecom Holdings, Inc., and in such capacity hereby certifies
that he is familiar with the facts herein certified, is duly authorized to
certify the same and does hereby certify that (i) the amount of Available Cash
does not exceed $20,000,000.00, exclusive of the CenturyTel Proceeds deposited
in the "CIT Lending Services Corporation - KMC II Securities/Proceeds Collateral
Account" no. ▇▇▇▇▇▇▇▇ maintained at Wachovia Bank, National Association, and
(ii) all amounts required to be transferred by Data Holdco and the Data
Subsidiaries to KMC Telecom Holdings, Inc. and contributed by KMC Telecom
Holdings, Inc. to the Borrowers pursuant to Section 5.22 of the Loan and
Security Agreement have been so transferred and contributed.
IN WITNESS WHEREOF, they have executed this Certificate on
behalf of the Corporation on this ___ day of _________, _______.
KMC TELECOM HOLDINGS, INC.
By:
-----------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President and Chief Financial
Officer
2
ENDORSEMENT
FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to
_____________________ the Subordinated Note dated May ___, 2002 issued by KMC
Telecom Holdings, Inc. to the order of KMC Data Holdco LLC in the amount of
$152,495,848.00 (the "SUBORDINATED NOTE") and does hereby irrevocably constitute
and appoint _______________ as the undersigned's true and lawful attorney, for
it and in its name and stead, to assign and transfer the Subordinated Note, and
for that purpose to make and execute all necessary endorsements or other acts of
assignment and transfer thereof, and to substitute one or more persons with like
full power, hereby ratifying and confirming all that said attorney or substitute
or substitutes shall lawfully do by virtue hereof.
Dated: May ___, 2002
KMC Data Holdco LLC
By:
-----------------------
Name:
Title:
REAFFIRMATION OF GUARANTY Exhibit A-1
ATTACHMENT F
TO TENTH AMENDMENT
SUBORDINATED NOTE
$152,495,848.00 Dated As of: May ___, 2002
FOR VALUE RECEIVED, the undersigned, KMC Telecom Holdings,
Inc. ("HOLDINGS"), a Delaware corporation, HEREBY PROMISES TO PAY to the order
of KMC Data Holdco LLC, a Delaware limited liability company (the "HOLDER") an
amount equal to ONE HUNDRED FIFTY TWO MILLION FOUR HUNDRED NINETY FIVE THOUSAND
AND EIGHT HUNDRED FORTY EIGHT AND 00/100 DOLLARS ($152,495,848.00). Capitalized
terms not otherwise defined herein shall have the meanings specified in Amended
and Restated Loan and Security Agreement, dated as of February 15, 2000, among
KMC TELECOM LLC, a Delaware limited liability company (f/k/a KMC TELECOM INC., a
Delaware corporation) ("KMC"), KMC TELECOM II LLC, a Delaware limited liability
company (f/k/a KMC TELECOM II, INC., a Delaware corporation) ("KMC II"), KMC
TELECOM III LLC, a Delaware limited liability company (f/k/a KMC TELECOM III,
INC., a Delaware corporation) ("KMC III"), KMC TELECOM OF VIRGINIA, INC., a
Virginia public service company ("KMC VIRGINIA"), KMC TELECOM LEASING I LLC, a
Delaware limited liability company ("LEASING I"), KMC TELECOM LEASING II LLC, a
Delaware limited liability company ("LEASING II"), KMC TELECOM LEASING III LLC,
a Delaware limited liability company ("LEASING III"), KMC ▇▇▇▇▇▇▇.▇▇▇, INC., a
Delaware corporation ("▇▇▇▇▇▇▇.▇▇▇"), KMC III SERVICES LLC, a Delaware limited
liability company ("SERVICES"; KMC, KMC II, KMC III, KMC Virginia, Leasing I ,
Leasing II, Leasing III, ▇▇▇▇▇▇▇.▇▇▇ and Services being hereinafter collectively
referred to hereinafter as the "BORROWERS"), the "Lenders" party hereto, FIRST
UNION NATIONAL BANK, as administrative agent for the Lenders (the "AGENT") and
CIT LENDING SERVICES CORPORATION (f/k/a NEWCOURT COMMERCIAL FINANCE
CORPORATION), as collateral agent for the Lenders (the "COLLATERAL AGENT";
together with the Agent, the "AGENTS") (as amended the Amended Loan Agreement).
Payments of principal on this Note shall be reduced from time
to time in an amount equal to the Holder's and its subsidiaries' share of
Holdings' expenses incurred in the ordinary course of business in accordance
with the Amended Loan Agreement.
Payment of principal on this Note is subject to and
subordinate to the Obligations due to the Lenders as set forth in the Amended
Loan Agreement and will have a maturity date occurring on the third annual
anniversary of the Term Loan Termination Date.
Holder by its acceptance of this Note agrees on behalf of
itself and any other holders that the payment of the principal amount of this
Note is hereby expressly subordinated in right of payment to the payment and
performance of the Obligations.
In the event that Holder receives any payment or other
distribution of any kind or character from Holdings or from any other source in
respect of this Note other than as expressly permitted by this Note, such
payment or other distribution shall be received in trust for the benefit of the
Lenders and shall be turned over to the Agent for the benefit of the Lenders.
The foregoing provisions are for the benefit of the Lenders
and may be enforced by the Agent on behalf of such Lenders.
THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
KMC TELECOM HOLDINGS, INC.
By:
----------------------
Name:
Title:
Address:
ATTACHMENT G
TO TENTH AMENDMENT
DATA HOLDCO PLEDGE AGREEMENT
This PLEDGE AGREEMENT ("PLEDGE AGREEMENT"), dated as of May
___, 2002, is executed by and between KMC Data Holdco LLC, a Delaware limited
liability company (the "PLEDGOR"), and CIT Lending Services Corporation (f/k/a
Newcourt Commercial Finance Corporation), as "Collateral Agent" for the ratable
benefit of the "Lenders" (each as defined below) (in such capacity, the
"COLLATERAL AGENT"). Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings given to such terms in the "Loan
Agreement" (as defined below).
WITNESSETH:
WHEREAS, KMC TELECOM INC., a Delaware corporation ("KMC"), KMC
TELECOM II, INC., a Delaware corporation ("KMC II"), KMC TELECOM III, INC., a
Delaware corporation ("KMC III"), KMC TELECOM OF VIRGINIA, INC., a Virginia
public service company ("KMC VIRGINIA"), KMC TELECOM LEASING I LLC, a Delaware
limited liability company ("LEASING I"), KMC TELECOM LEASING II LLC, a Delaware
limited liability company ("LEASING II"), KMC TELECOM LEASING III LLC, a
Delaware limited liability company ("LEASING III"), KMC ▇▇▇▇▇▇▇.▇▇▇, INC., a
Delaware corporation ("▇▇▇▇▇▇▇.▇▇▇"),KMC III SERVICES LLC, a Delaware limited
liability company ("SERVICES"), the Additional Borrowers from time to time party
thereto (KMC, KMC II, KMC III, KMC Virginia, Leasing I , Leasing II, Leasing
III, ▇▇▇▇▇▇▇.▇▇▇, Services and any Additional Borrower being hereinafter
collectively referred to hereinafter as the "BORROWERS"), the "Lenders" party
thereto, FIRST UNION NATIONAL BANK ("FIRST UNION"), as administrative agent for
the Lenders (the "AGENT"; the Agent together with the Collateral Agent being
referred to as the "AGENTS") and the Collateral Agent have entered into a
certain Amended and Restated Loan and Security Agreement dated as of February
15, 2000 (as amended through the date hereof and as it may be further amended,
restated, supplemented or otherwise modified from time to time, the "LOAN
AGREEMENT"; undefined capitalized terms which are used herein shall have the
meanings ascribed to such terms in the Loan Agreement);
WHEREAS, Section 2.6 of Amendment No. 10 and Limited Waiver to
the Amended and Restated Loan and Security Agreement requires that the Pledgor
shall have granted a first priority security interest in the Subordinated Note,
dated May ___, 2002, issued by KMC Telecom Holdings, Inc. to the Pledgor in the
amount of one hundred fifty two million four hundred ninety five thousand and
eight hundred forty eight and 00/100 dollars ($152,495,848.00) (the
"SUBORDINATED NOTE") in order to secure the prompt and complete payment,
observance and performance of all of the "Obligations" under and as defined in
the Loan Agreement.
NOW, THEREFORE, in consideration of the premises set forth
herein and in order to induce the Lender to make other financial accommodations
under the Loan Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Pledgor and the
Collateral Agent hereby agree as follows:
1. PLEDGE. The Pledgor hereby pledges to the Collateral Agent
for the benefit of the Agents
and the Lenders, and grants to the Collateral Agent for the benefit of the
Agents and the Lenders, a security interest in and to all of the Pledgor's now
owned and hereafter acquired right, title and interest in the Subordinated Note.
2. SECURITY FOR THE OBLIGATIONS. The Subordinated Note secures
the prompt payment, performance and observance of the Obligations.
3. SUBSEQUENT CHANGES AFFECTING SUBORDINATED NOTE. The Pledgor
represents and warrants that it has made its own arrangements for keeping
informed of changes or potential changes affecting the Subordinated Note, and
the Pledgor agrees that the Collateral Agent shall have no obligation to inform
the Pledgor of any such changes or potential changes or to take any action or
omit to take any action with respect thereto.
4. REPRESENTATIONS AND WARRANTIES. The Pledgor represents and
warrants as follows:
(a) the Pledgor has full power and authority (corporate or
otherwise) to enter into this Pledge Agreement;
(b) the Pledgor has the right to pledge and grant a security
interest in or otherwise transfer such Subordinated Note free of any Liens;
(c) the pledge of the Pledgor's Subordinated Note pursuant to
this Pledge Agreement creates a valid and perfected first priority security
interest in such Subordinated Note, in favor of the Collateral Agent, securing
the payment and performance of the Obligations; and
(d) the powers are duly executed and give the Collateral Agent
the authority they purport to confer.
5. TRANSFERS AND OTHER LIENS. The Pledgor agrees that it will
not create or permit to exist any Lien upon or with respect to any of the
Subordinated Note, other than any Lien granted pursuant to this Pledge
Agreement.
6. REMEDIES. The Collateral Agent shall have, in addition to
any other rights given under this Pledge Agreement or by law, all of the rights
and remedies with respect to the Subordinated Note of a secured party under the
Uniform Commercial Code as in effect in the State of New York. In addition,
after the occurrence and during the continuation of an Event of Default, the
Collateral Agent shall have such powers as may be conferred by applicable law.
Notwithstanding any other provision of this Pledge Agreement to the contrary,
the exercise of any rights hereunder by the Collateral Agent that may require
FCC or any PUC approval shall be subject to obtaining such approval. Pending
obtaining FCC or such PUC approval the Pledgor will not do anything to delay,
hinder, interfere or obstruct the exercise of the Collateral Agent's rights
hereunder in obtaining such approvals.
7. SECURITY INTEREST ABSOLUTE. All rights of the Collateral
Agent and security interests hereunder, and all obligations of the Pledgor
hereunder, shall be absolute and unconditional irrespective of
2
(1) any lack of validity or enforceability of the Loan
Agreement or any other agreement or instrument relating thereto;
(2) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent to any departure from the Loan
Agreement;
(3) any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to
departure from any guaranty or any other surety or obligor
arrangement, for all or any of the Obligations; or
(4) to the extent permitted by law, any other circumstance
which might otherwise constitute a defense available to, or a
discharge of, the Pledgor in respect of the Obligations or of this
Pledge Agreement other than indefeasible payment in full (in cash).
8. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT. The Pledgor
hereby appoints the Collateral Agent its attorney-in-fact, with full authority,
in the name of the Pledgor or otherwise, after the occurrence and during the
continuation of an Event of Default, from time to time in the Collateral Agent's
discretion, to take any action and to execute any instrument which the
Collateral Agent may deem necessary or advisable to accomplish the purposes of
this Pledge Agreement.
9. WAIVERS. The Pledgor waives presentment and demand for
payment of any of the Obligations, protest and notice of dishonor or Event of
Default with respect to any of the Obligations and all other notices to which
the Pledgor might otherwise be entitled except as otherwise expressly provided
herein or in the Loan Agreement.
10. TERM. This Pledge Agreement shall remain in full force and
effect until the Obligations have been fully and indefeasibly paid and satisfied
and the Loan Agreement has terminated pursuant to its terms. Upon the
termination of this Pledge Agreement as provided above, the Collateral Agent
will release the security interest created hereunder and will deliver the
Subordinated Note.
11. DEFINITIONS. The singular shall include the plural and
vice versa and any gender shall include any other gender as the context may
require.
12. SUCCESSORS AND ASSIGNS. This Pledge Agreement shall be
binding upon and inure to the benefit of the Pledgor, the Collateral Agent and
their respective successors and assigns. The Pledgor's successors and assigns
shall include, without limitation, a receiver, trustee or debtor in possession
of or for the Pledgor.
13. SEVERABILITY. Whenever possible, each provision of this
Pledge Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but, if any provision of this Pledge Agreement shall
be held to be prohibited or invalid under applicable law, such provision shall
be ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Pledge Agreement. Furthermore, if any term or provision hereof is held to be
inconsistent with the Communications Act of 1934, as amended, 47 U.S.C. 151 et
seq., or with the Rules and
3
Regulations of the FCC, or otherwise illegal, unenforceable or invalid for any
reason, such provision shall not affect the remainder hereof, and the parties
shall promptly cooperate in good faith to modify this Pledge Agreement, so as to
avoid any impairment of Collateral Agent's security interest in the Subordinated
Note.
14. GOVERNING LAW: JURISDICTION. ANY DISPUTE BETWEEN THE
COLLATERAL AGENT, THE AGENT OR THE LENDERS AND THE PLEDGOR ARISING OUT OF OR
RELATED TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
PLEDGE AGREEMENT, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE,
SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS
OF LAW PROVISIONS) AND DECISIONS OF THE STATE OF NEW YORK. THE PLEDGOR CONSENTS
TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURT LOCATED IN THE CITY AND
STATE OF NEW YORK AND WAIVE ANY OBJECTION RELATING TO IMPROPER VENUE OR FORUM
NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING BY SUCH COURT.
15. SERVICE OF PROCESS. The Pledgor waives personal service of
any process upon it, and irrevocably consents to the service of process in any
action or proceeding by mailing of copies thereof by registered or certified
mail, postage prepaid, to the Pledgor at the Pledgor's notice address set forth
in the Loan Agreement, such service to become effective five (5) Business Days
after same shall have been posted as aforesaid.
16. WAIVER OF JURY TRIAL. EACH OF THE PLEDGOR AND THE
COLLATERAL AGENT WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN THE COLLATERAL AGENT AND THE
PLEDGOR ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS
PLEDGE AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH. EITHER THE PLEDGOR OR THE COLLATERAL AGENT MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS PLEDGE AGREEMENT WITH ANY COURT
AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.
17. WAIVER OF BOND. The Pledgor waives the posting of any bond
otherwise required of the Collateral Agent in connection with any judicial
process or proceeding to realize on the Subordinated Note or any other security
for its obligations hereunder, to enforce any judgment or other court order
entered in favor of the Collateral Agent, or to enforce by specific performance,
temporary restraining order, or preliminary or permanent injunction, this Pledge
Agreement or any other agreement or document between the Collateral Agent and
the Pledgor.
18. FURTHER ASSURANCES. The Pledgor agrees that it will
cooperate with the Collateral Agent and will execute and deliver, or cause to be
executed and delivered, all such other documents, and will take all such other
action, as the Collateral Agent may reasonably
4
request from time to time in order to carry out the provisions and purposes of
this Pledge Agreement.
19. THE COLLATERAL AGENT'S DUTY OF CARE. The Collateral Agent
shall not be liable for any acts, omissions, errors of judgment or mistakes of
fact or law including, without limitation, acts, omissions, errors or mistakes
with respect to the Subordinated Note, except for those arising solely out of or
solely in connection with the Collateral Agent's (i) gross negligence or willful
misconduct, or (ii) failure to use reasonable care with respect to the safe
custody of the Subordinated Note in the Collateral Agent's possession. Without
limiting the generality of the foregoing, the Collateral Agent shall be under no
obligation to take any steps necessary to preserve rights in the Subordinated
Note against any other parties but may do so at its option. All expenses
incurred in connection therewith shall be for the sole account of the Pledgor,
and shall constitute part of the Obligations secured hereby.
20. NOTICES. All notices and other communications required or
desired to be served, given or delivered hereunder shall be made in the manner
prescribed by the Loan Agreement and to the following addresses, facsimile and
telephone numbers:
if to the Collateral Agent, to
CIT Lending Services Corporation,
f/k/a Newcourt Commercial Finance Corporation
as Collateral Agent
▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President Credit-Communications & Media Finance Group
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
and
Attention: Legal Counsel-Communications & Media Finance Group
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
O'Melveny & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
5
if to the Pledgor to:
KMC Data Holdco LLC
▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: 908-719-2200
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile: 212-808-7897
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
21. AMENDMENTS, WAIVERS AND CONSENTS. No amendment or waiver
of any provision of this Pledge Agreement nor consent to any departure by the
Pledgor herefrom, shall in any event be effective unless the same shall be in
writing and signed by the Collateral Agent pursuant to the terms of the Loan
Agreement and then such amendment, waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
22. NO STRICT CONSTRUCTION. The parties hereto have
participated, jointly in the negotiation and drafting of this Pledge Agreement.
In the event of any ambiguity or question of intent or interpretation arises,
this Pledge Agreement shall be construed as if drafted jointly by the parties
hereto and no presumption or burden of proof shall arise favoring or disfavoring
any party by virtue of authorship of any provisions of this Pledge Agreement.
23. SECTION HEADING. The section headings herein are for
convenience of reference only, and shall not affect in any way the
interpretation of any of the provisions hereof.
24. EXECUTION IN COUNTERPARTS. This Pledge Agreement may be
executed in any number of counterparts, each of which shall be an original, but
all of which shall together constitute one and the same agreement.
6
IN WITNESS WHEREOF, the Pledgor and the Collateral Agent have
executed and delivered this Pledge Agreement by their respective duly authorized
officers as of the date first above written.
MC DATA HOLDCO LLC, as the Pledgor
-------------------------------------------
Name:
Title:
CIT LENDING SERVICES CORPORATION
(f/k/a NEWCOURT COMMERCIAL FINANCE
CORPORATION), as the Collateral Agent
-------------------------------------------
Name:
Title:
ATTACHMENT H
TO TENTH AMENDMENT
REAFFIRMATION OF GUARANTY
Reference is hereby made to (i) that certain Amended and
Restated Guaranty and Security Agreement dated as of April 12, 2001 (as amended
to the date hereof and as it may be further restated, supplemented or otherwise
modified from time to time, the "KMC HOLDINGS GUARANTY") by KMC Telecom
Holdings, Inc., a Delaware corporation ("KMC HOLDINGS"), in favor of CIT Lending
Services Corporation (f/k/a Newcourt Commercial Finance Corporation), as
collateral agent for the ratable benefit of the "Lenders" (defined below) (in
such capacity, the "COLLATERAL AGENT"), (ii) that certain Amended and Restated
Guaranty and Security Agreement dated as of June 1, 2001 (as amended to the date
hereof and as it may be further restated, supplemented or otherwise modified
from time to time, the "KMC I SERVICES GUARANTY") by KMC I Services LLC, a
Delaware limited liability company ("KMC I SERVICES"), in favor of Collateral
Agent, (iii) that certain Amended and Restated Guaranty and Security Agreement
dated as of June 1, 2001 (as amended to the date hereof and as it may be further
restated, supplemented or otherwise modified from time to time, the "KMC II
SERVICES GUARANTY") by KMC II Services LLC, a Delaware limited liability company
("KMC II SERVICES"), in favor of the Collateral Agent; (iv) that certain
Guaranty dated as of June 1, 2001 (as amended to the date hereof and as it may
be further restated, supplemented or otherwise modified from time to time, the
"DATA HOLDCO GUARANTY") of KMC Data Holdco LLC, a Delaware limited liability
company ("DATA HOLDCO"), in favor of the Collateral Agent; (v) that certain
Guaranty and Security Agreement dated as of June 1, 2001 (as amended to the date
hereof and as it may be further restated, supplemented or otherwise modified
from time to time, the "KMC FINANCING GUARANTY") by KMC Telecom Financing, Inc.,
a Delaware corporation ("KMC FINANCING"), in favor of the Collateral Agent; (vi)
that certain Guaranty and Security Agreement dated as of June 1, 2001 (as
amended to the date hereof and as it may be further restated, supplemented or
otherwise modified from time to time, the "KMC FINANCIAL SERVICES GUARANTY") by
KMC Financial Services LLC, a Delaware limited liability company ("KMC FINANCIAL
SERVICES"), in favor of the Collateral Agent; (vii) that certain Guaranty and
Security Agreement dated as of November 1, 2001 (as amended to the date hereof
and as it may be further restated, supplemented or otherwise modified from time
to time, the "HOLDINGS IV GUARANTY") by KMC Telecom IV Holdings, Inc., a
Delaware corporation ("HOLDINGS IV"), in favor of the Collateral Agent; (viii)
that certain Guaranty and Security Agreement dated as of November 1, 2001 (as
amended to the date hereof and as it may be further restated, supplemented or
otherwise modified from time to time, the "KMC IV GUARANTY") by KMC Telecom IV,
Inc., a Delaware corporation ("KMC IV"), in favor of the Collateral Agent; (ix)
that certain Guaranty and Security Agreement dated as of November 1, 2001 (as
amended to the date hereof and as it may be further restated, supplemented or
otherwise modified from time to time, the "KMC IV SERVICES GUARANTY") by KMC IV
Services LLC, a Delaware limited liability company ("KMC IV SERVICES"), in favor
of Collateral Agent; (x) that certain Guaranty and Security Agreement dated as
of November 1, 2001 (as amended to the date hereof and as it may be further
restated, supplemented or otherwise modified from time to time, the "LEASING
IV") by KMC Telecom Leasing IV LLC, a Delaware limited liability company
("LEASING IV"), in favor of the Collateral Agent; (xi) that certain Guaranty and
Security Agreement dated as of November 1, 2001 (as
amended to the date hereof and as it may be further restated, supplemented or
otherwise modified from time to time, the "KMC ▇▇▇▇▇▇▇▇ ▇▇ GUARANTY"; together
with the KMC Holdings Guaranty, KMC I Services Guaranty, KMC II Services
Guaranty, Data Holdco Guaranty, KMC Financing Guaranty, KMC Financial Services
Guaranty, Holdings IV Guaranty, KMC IV Guaranty, KMC IV Services Guaranty,
Leasing IV Guaranty, collectively, the "GUARANTIES") by KMC Telecom IV of
Virginia, a Virginia public service company ("KMC ▇▇▇▇▇▇▇▇ ▇▇"; together with
KMC Holdings, KMC I Services, KMC II Services, Data Holdco, KMC Financing, KMC
Financial Services, Holdings IV, KMC IV, KMC IV Services and Leasing IV, the
"GUARANTORS"), in favor of Collateral Agent; (xii) that certain Amended and
Restated Loan and Security Agreement dated as of February 15, 2000 (as amended
to the date hereof and as it may be further restated, supplemented or otherwise
modified from time to time, the "LOAN AGREEMENT") among KMC Telecom LLC (f/k/a
KMC Telecom, Inc.), KMC Telecom II LLC (f/k/a KMC Telecom II, Inc.), KMC Telecom
III LLC (f/k/a KMC Telecom III, Inc.), KMC Telecom of Virginia, Inc., KMC
Telecom Leasing I LLC, KMC Telecom Leasing II LLC, KMC Telecom Leasing III LLC,
KMC ▇▇▇▇▇▇▇.▇▇▇, KMC III Services LLC (each of the foregoing being referred to
collectively as the "BORROWERS"), the financial institutions from time to time
parties thereto (the "LENDERS"), First Union National Bank, as administrative
agent for the Lenders (the "AGENT"), and the Collateral Agent and (xiv) that
certain Amendment No. 10 and Limited Waiver to Amended and Restated Loan and
Security Agreement dated as of the date hereof (the "AMENDMENT") among the
Borrowers, the Lenders, the Agent and the Collateral Agent. Undefined
capitalized terms used herein shall have the meanings assigned thereto in the
Loan Agreement.
Each Guarantor, by its signature below, without in any way
establishing a course of dealing, hereby (i) acknowledges and consents to the
execution and delivery of the Amendment by the parties thereto, (ii) agrees that
the Amendment shall not limit or diminish the obligations of such Guarantor to
guarantee all of the "Obligations" of each Borrower under and as defined in the
Loan Agreement and such other amounts as are more specifically described in the
Guaranty to which such Guarantor is a party, (iii) reaffirms all of its
obligations under the Guaranty to which such Guarantor is a party, and (iv)
agrees that the Guaranty to which such Guarantor is a party remains in full
force and effect and is hereby ratified and confirmed.
2
IN WITNESS WHEREOF, this instrument has been executed and
delivered as of this ___ day of May, 2002.
KMC TELECOM HOLDINGS, INC.
KMC TELECOM FINANCING, INC.
KMC TELECOM IV HOLDINGS, INC.
KMC TELECOM IV, INC.
KMC TELECOM IV OF VIRGINIA, INC.
In each case:
By:
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
KMC I SERVICES LLC
By: KMC Telecom, Inc., as its Sole Member
By:
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
KMC II SERVICES LLC
By: KMC Telecom II, Inc., as its Sole Member
By:
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
REAFFIRMATION OF GUARANTY S-1
KMC DATA HOLDCO LLC
By: KMC Telecom Holdings, Inc., as its Sole Member
By:___________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
KMC FINANCIAL SERVICES LLC
By: KMC Telecom III, Inc., as its Sole Member
By:
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
KMC IV SERVICES LLC
KMC TELECOM LEASING IV LLC
In each case:
By: KMC Telecom IV, Inc., as its Sole Member
By:
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
REAFFIRMATION OF GUARANTY S-2
ATTACHMENT N
TO TENTH AMENDMENT
1. Media Gateway Services Agreement, dated September 21, 1999, among Qwest
Communications Corporation, KMC Telecom Inc., KMC Telecom II, Inc., KMC Telecom
III, Inc. and KMC Telecom of Virginia, Inc.
Amendment No. 1 to Media Gateway Services Agreement, dated February 1,
2000, among Qwest Communications Corporation, KMC Telecom Inc., KMC
Telecom II, Inc., KMC Telecom III, Inc. and KMC Telecom of Virginia,
Inc.
Amendment No. 2 to Media Gateway Services Agreement, dated March 29,
2001, among Qwest Communications Corporation, KMC Telecom Inc., KMC
Telecom II, Inc., KMC Telecom III, Inc. and KMC Telecom of Virginia,
Inc.
2. Amended and Restated Media Gateway Services Agreement II, dated as of
March 31, 2000, as amended on November 11, 2000, by and between KMC Telecom V
Inc. and Qwest Communications Corporation.
Amendment No. 1, dated as of December 31, 2000, to Amended and Restated
Media Gateway Services II, by and among Qwest Communications
Corporation, Qwest Communications International Inc. and KMC Telecom V
Inc.
3. Media Gateway Services Agreement III between KMC Telecom VI, Inc. and
Qwest Communications Corporation, effective as of June 30, 2000.
Amendment No. 1 to the Media Gateway Services Agreement III between KMC
Telecom VI, Inc. and Qwest Communications Corporation, effective as of
August 31, 2000.
Amendment No. 2, dated as of November 1, 2000, to Media Gateway Services
Agreement III, by and among Qwest Communications Corporation, Qwest
Communications International Inc. and KMC Telecom VI Inc.
Amendment No. 3, dated as of March 1, 2001, to Media Gateway Services
Agreement III, by and among Qwest Communications Corporation, Qwest
Communications International Inc. and KMC Telecom VI Inc.
4. Media Gateway Services Agreement IV, effective as of March 31, 2001,
among KMC Telecom VIII LLC, Qwest Communications Corporation and Qwest
Communications International,
ATTACHMENT O
TO TENTH AMENDMENT
118 Cisco AS5800s (158,592 ports)
