Exhibit 10.40
EXECUTION COPY
SECOND AMENDMENT TO AMENDED
AND RESTATED CREDIT AGREEMENT AND CONSENT
THIS SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND CONSENT
(this "Agreement") dated as of the 28th day of September, 2001 (the "Agreement
Date"), by and among iPCS WIRELESS, INC. (the "Borrower"), a Delaware
corporation, iPCS, INC., ("Holdings"), a Delaware corporation, iPCS EQUIPMENT,
INC. ("Equipmentco"), a Delaware corporation (collectively with the Borrower and
Holdings, the "Loan Parties"), the Lenders (as defined in the Credit Agreement
defined below), and TORONTO DOMINION (TEXAS), INC., as administrative agent (the
"Administrative Agent").
W I T N E S S E T H:
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WHEREAS, the Loan Parties, the Lenders and the Administrative Agent are
parties to that certain Amended and Restated Credit Agreement dated as of July
12, 2000, as amended by that certain First Amendment to Amended and Restated
Credit Agreement and Consent dated as of February 23, 2001 (the "Credit
Agreement");
WHEREAS, the Borrower has requested that the Lenders, and the Lenders have
agreed to, subject to the terms hereof, amend the Credit Agreement as more fully
set forth herein; and
WHEREAS, the Borrower has requested that the Lenders, and the Lenders have
agreed to, subject to the terms hereof, consent to the merger (the "AirGate
Merger") of Holdings with and into a wholly-owned subsidiary of AirGate PCS,
Inc. (the "Merger Sub") with Holdings being the survivor, pursuant to that
certain Agreement and Plan of Merger dated as of August 28, 2001 (the "AirGate
Merger Agreement"), by and between AirGate PCS, Inc., a Delaware corporation
("AirGate"), and Holdings;
NOW, THEREFORE, in consideration of the premises set forth above, the
covenants and agreements hereinafter set forth, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree that all capitalized terms used and not defined herein
shall have the meanings ascribed thereto in the Credit Agreement, and further
agree as follows:
1. Amendment to Section 1.1. Section 1.1, Definitions, of the Credit
Agreement, is hereby amended as follows:
(a) Each of the definitions of "Change in Control", "Contributed Capital"
and "EBITDA" are hereby amended by deleting such definition in its entirety and
by substituting in lieu thereof the following:
"`Change in Control' means the existence or occurrence of any of the
following: (a) any of the Capital Stock of the Borrower is owned,
beneficially or of record, by any Person other than Holdings; (b) any
Capital Stock of Equipmentco or any other
Subsidiary of the Borrower is owned, beneficially or of record, by any
Person other than the Borrower; (c)(i) prior to the AirGate Merger
Effective Date, any Person or two or more Persons (other than the Permitted
Holders) acting as a group (as defined in Section 13d-3 of the Exchange
Act) shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Exchange Act) of
35% or more of the outstanding shares of Voting Stock of Holdings and (ii)
on or after the AirGate Merger Effective Date, any Capital Stock of
Holdings is owned, beneficially or of record, by any person other than
AirGate; (d) on or after the AirGate Merger Effective Date, any Person or
two or more Persons acting as a group (as defined in Section 13d-3 of the
Exchange Act) shall have acquired beneficial ownership (within the meaning
of Rule 13d-3 of the Securities and Exchange Commission under the Exchange
Act) of 35% or more of the outstanding shares of Voting Stock of AirGate;
(e)(i) prior to the AirGate Merger Effective Date, individuals who, as of
the Effective Date, constitute the Board of Directors of Holdings (the
"Holdings Incumbent Board") cease for any reason to constitute at least a
majority of the Board of Directors of Holdings; provided, however, that any
individual becoming a director of Holdings subsequent to the Effective Date
whose election or nomination for election by Holdings' shareholders was
approved by a vote of at least a majority of the directors then comprising
the Holdings Incumbent Board shall be considered as though such individual
were a member of the Holdings Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest (as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange
Act) or other actual or threatened solicitation of proxies or contest by or
on behalf of a Person other than the Board of Directors of Holdings, and
(ii) on or after the AirGate Merger Effective Date, individuals who, as of
the AirGate Merger Effective Date, constitute the Board of Directors of
AirGate (the "AirGate Incumbent Board") cease for any reason to constitute
at least a majority of the Board of Directors of AirGate; provided,
however, that any individual becoming a director of AirGate subsequent to
the AirGate Merger Effective Date whose election or nomination for election
by AirGates' shareholders was approved by a vote of at least a majority of
the directors then comprising the AirGate Incumbent Board shall be
considered as though such individual were a member of the AirGate Incumbent
Board, but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or contest by or on behalf of a Person other than
the Board of Directors of AirGate; or (f) prior to the AirGate Merger
Effective Date, the consummation of any transaction the result of which is
that any Person or group beneficially owns more of the Voting Stock of
Holdings than is beneficially owned, in the aggregate, by the Permitted
Holders.
"Contributed Capital" means, as to any Person and as of any date of
determination, the sum of (a) all equity contributions then made in cash or
previously made in cash to such Person (including, with respect to both
Holdings and the Borrower, the gross proceeds of the Holdings Initial
Equity Offering and, with respect to both Holdings and the Borrower, the
gross proceeds of the Holdings Future Equity Offering and any other equity
contributed on or before the Effective Date), minus (b) all Restricted
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Payments (in any form) then made or previously made (excluding the
aggregate amount of such Restricted Payments paid by the Borrower to
Holdings to pay merger-related expenses pursuant to Section 9.4(e) hereof)
by such Person to or for the benefit of any other Person.
"`EBITDA' means, for any period, without duplication, the sum of the
following for the Borrower and its Consolidated Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP: (a)
Adjusted Net Income, plus (b) Consolidated Interest Expense, plus (c)
income and franchise taxes to the extent deducted in determining Adjusted
Net Income, plus (d) depreciation and amortization expense and other
non-cash items to the extent deducted in determining Adjusted Net Income,
minus (e) non-cash income (or losses) to the extent included in determining
Adjusted Net Income. Notwithstanding the foregoing, (x) for the quarter
ending December 31, 2000, EBITDA shall exclude expenses paid by the
Borrower in connection with the postponed initial public offering in an
amount not to exceed $1,324,000; and (y) for the quarters ending on or
before June 30, 2002, EBITDA shall exclude merger-related expenses paid by
the Borrower in an aggregate amount not to exceed $18,000,000.00 minus the
aggregate amount paid by the Borrower to Holdings to pay merger-related
expenses pursuant to Section 9.4(e) hereof."
(b) The following new definitions of "AirGate", "AirGate Merger", "AirGate
Merger Agreement" and "AirGate Merger Effective Date" are hereby inserted in the
proper alphabetical order:
"`AirGate' means AirGate PCS, Inc., a Delaware corporation."
"`AirGate Merger' means the merger contemplated under the AirGate
Merger Agreement."
"`AirGate Merger Agreement' means that certain Agreement and Plan of
Merger dated as of August 28, 2001 between Holdings and AirGate, as the
same may be amended, supplemented, waived or otherwise modified with the
consent of the Administrative Agent."
"`AirGate Merger Effective Date' means the effective date of the
AirGate Merger pursuant to the AirGate Merger Agreement."
2. Amendment to Section 9.4. Section 9.4, Restricted Payments, of the
Credit Agreement is hereby amended by deleting such subsection (e) in its
entirety and by substituting in lieu thereof the following:
"(e) The Borrower may make payments to Holdings in an aggregate amount
not to exceed the lesser of (i) $500,000 and (ii) the amount of any
liquidated damages payable by Holdings as a result of any Registration
Default (as defined in the Registration Rights Agreements each dated as of
the Effective Date, one among Holdings and the initial purchasers named
therein and the other, among Holdings, the guarantors of the
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Holdings Senior Notes and the initial purchasers named therein) so long as
the entirety of such payments must be used, substantially concurrently with
the payment thereof by the Borrower, by Holdings to pay the same amount of
liquidated damages required to be paid in accordance with such Registration
Rights Agreements and actually paid by Holdings in cash. Additionally, for
any quarter ending on or before June 30, 2002, the Borrower may make
payments to Holdings to pay merger-related expenses in an aggregate amount
not to exceed $18,000,000.00 minus the aggregate amount of merger-related
expenses excluded from EBITDA pursuant to the last sentence of the
definition thereof."
3. Consent to the AirGate Merger. Subject to the terms and conditions
hereof, notwithstanding any provisions of the Loan Documents to the contrary,
the undersigned Lenders hereby consent to the consummation of the AirGate
Merger; provided, that on or prior to the consummation of the AirGate Merger and
the transactions contemplated by the AirGate Merger Agreement, the Borrower
shall provide to the Administrative Agent, in form and substance reasonably
satisfactory to the Administrative Agent the following, copies of which the
Administrative Agent shall forward to the Lenders: (i) evidence that the AirGate
Merger has been consummated on substantially the terms and conditions set forth
in the AirGate Merger Agreement; (ii) evidence of the Borrower's and Holdings'
compliance with Sections 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6 of the Credit
Agreement, after giving effect to this Agreement and the AirGate Merger and the
Borrower's ability to meet its repayment obligations under the Credit Agreement
through the Maturity Date, after giving effect to the AirGate Merger; (iii)
certificate of a Responsible Officer of the Borrower that a Default does not
exist both before and after giving effect to the AirGate Merger, after giving
effect to the amendments contemplated herein; (iv) opinions of counsel to
Holdings and the Borrower opining as to the enforceability, validity and binding
nature of the Credit Agreement and other Loan Documents after giving effect to
the AirGate Merger; and (v) a certificate of a Responsible Officer of the
Borrower that, after giving effect to the Airgate Merger, neither Holdings,
Borrower nor any of their Subsidiaries is subject to, bound by, or a party to
any credit agreement or other agreement by which Airgate has incurred or will
incur Debt ("Airgate Debt Documents"), or any agreement, instrument or document
executed and delivered in connection with the Airgate Debt Documents.
4. No Other Amendment or Waiver. Notwithstanding the agreement of the
Lenders to the terms and provisions of this Agreement, the Loan Parties
acknowledge and expressly agree that this Agreement is limited to the extent
expressly set forth herein and shall not constitute a modification of the Credit
Agreement or any other Loan Documents or a course of dealing at variance with
the terms of the Credit Agreement or any other Loan Documents (other than as
expressly set forth above) so as to require further notice by the Administrative
Agent or the Lenders, or any of them, of its or their intent to require strict
adherence to the terms of the Credit Agreement and the other Loan Documents in
the future. All of the terms, conditions, provisions and covenants of the Credit
Agreement and the other Loan Documents shall remain unaltered and in full force
and effect except as expressly modified by this Agreement. The Credit Agreement
and each other Loan Document shall be deemed modified hereby solely to the
extent necessary to effect the waivers and amendments contemplated hereby.
5. Representations and Warranties. The Loan Parties hereby represent and
warrant in favor of the Administrative Agent and each Lender as follows:
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(a) Each of the Loan Parties has the corporate power and authority (i)
to enter into this Agreement and (ii) to do all other acts and things as
are required or contemplated hereunder to be done, observed and performed
by them;
(b) This Agreement has been duly and validly executed and delivered by
each of the Loan Parties that is a party thereto, and such Agreement
constitutes the legal, valid and binding obligations of such Persons,
enforceable against each such Person in accordance with their respective
terms, except as limited by bankruptcy, insolvency or other laws of general
application relating to the enforcement of creditors' rights and general
principles of equity.
(c) The execution and delivery of this Agreement and the performance
by the Loan Parties under the Credit Agreement and the other Loan Documents
to which each is a party, as amended hereby, do not and will not require
the consent or approval of any regulatory authority or governmental
authority or agency having jurisdiction over the Loan Parties or any of
their Subsidiaries which has not already been obtained, nor is in
contravention of or in conflict with the articles of incorporation, by-laws
or partnership agreements of the Loan Parties or any of their Subsidiaries,
or any provision of any statute, judgment, order, or material indenture,
instrument, agreement, or undertaking to which Loan Parties or any of their
Subsidiaries is a party or by which any of their respective assets or
properties is or may become bound; and
(d) The representations and warranties contained in Article 7 of the
Credit Agreement and contained in the other Loan Documents remain true and
correct as of the date hereof, both before and after giving effect to this
Agreement, except to the extent previously fulfilled in accordance with the
terms of the Credit Agreement or such other Loan Document, as applicable,
or to the extent relating specifically to the earlier date. No Default now
exists or will be caused hereby.
6. Conditions Precedent; Effective Date. This Agreement shall be effective
as of the Agreement Date subject to satisfaction of each of the following
conditions precedent:
(a) all of the representations and warranties of the Borrower under
Section 5 hereof which are made as of the date hereof, being true and
correct in all material respects;
(b) receipt by the Administrative Agent, on behalf of the Lenders
executing and delivering this Agreement on or before September 28, 2001, of
an amendment fee in the amount of 0.10% of the aggregate Commitments of
such Lenders (such sum, the "Amendment Fee"), which Amendment Fee shall be
fully earned when due and non-refundable when paid; and
(c) receipt by the Administrative Agent of counterparts hereof
executed by the Required Lenders and each of the Loan Parties.
7. Guarantor Acknowledgment.
(a) Each of Holdings and Equipmentco has guarantied the Obligations.
Holdings and Equipmentco are collectively referred to herein as the
"Guarantors", and the Guaranty executed by each Guarantor are collectively
referred to herein as the "Guaranties".
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(b) Each Guarantor hereby acknowledges that it has reviewed the terms
and provisions of the Credit Agreement and this Agreement. Each Guarantor
hereby confirms that the Guaranty to which it is a party or otherwise bound
will continue to guarantee, as the case may be, to the fullest extent
possible in accordance with such Guaranty the payment and performance of
all "Obligations" under each of the Guaranties, as the case may be (in each
case as such terms are defined in the applicable Guaranty), including
without limitation the payment and performance of all such "Obligations"
under each of the Guaranties, as the case may be, in respect of the
Obligations of the Borrower now or hereafter existing under or in respect
of the Credit Agreement and the Notes defined therein.
(c) Each Guarantor acknowledges and agrees that any of the Guaranties
to which it is a party or otherwise bound shall continue in full force and
effect and that all of its obligations thereunder shall be valid and
enforceable and shall not be impaired or limited by the execution or
effectiveness of this Agreement. Each Guarantor represents and warrants
that all representations and warranties contained in the Credit Agreement,
this Agreement and the Guaranty to which it is a party or otherwise bound
are true, correct and complete in all material respects on and as of the
date hereof to the same extent as though made on and as of that date,
except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and
complete in all material respects on and as of such earlier date.
(d) Each Guarantor acknowledges and agrees that (i) notwithstanding
the conditions to effectiveness set forth in this Agreement, such Guarantor
is not required by the terms of the Credit Agreement or any other Loan
Document to consent to the amendments of the Credit Agreement effected
pursuant to this Agreement and (ii) nothing in the Credit Agreement, this
Agreement or any other Loan Document shall be deemed to require the consent
of such Guarantor to any future amendments to the Credit Agreement.
8. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute one and the same instrument.
9. Loan Documents. Each reference in the Credit Agreement or any other Loan
Document to the term "Credit Agreement" shall hereafter mean and refer to the
Credit Agreement as amended hereby and as the same may hereafter be amended.
10. Governing Law. This Agreement shall be construed in accordance with and
governed by the internal laws of the State of New York, applicable to agreements
made and to be performed in New York.
11. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof in that jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused it to be executed under seal by their duly authorized officers, all as of
the day and year first above written.
BORROWER: iPCS WIRELESS, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Title: President & CEO
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HOLDINGS: iPCS, INC., a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Title: President & CEO
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EQUIPMENTCO: iPCS EQUIPMENT, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: President & CEO
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ADMINISTRATIVE AGENT
AND LENDERS: TORONTO DOMINION (TEXAS), INC., as
Administrative Agent and as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Vice President
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GE CAPITAL CORPORATION, as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Vice President - Portfolio Marketing
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THE BANK OF NOVA SCOTIA, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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Title: Authorized Signatory
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BANK OF TOKYO-MITSUBISHI TRUST
COMPANY, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Vice President
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CITY NATIONAL BANK, as a Lender
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇ ▇▇▇▇▇▇▇
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Title: Senior Vice President
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FORTIS CAPITAL CORP., as a Lender
By:
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Name:
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Title:
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By:
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Name:
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Title:
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IBM CREDIT CORPORATION, as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Manager of Credit
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NATIONAL CITY BANK, as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Title: Senior Vice President
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PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Vice President
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