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EXHIBIT 10.14.2
FIRST AMENDMENT
TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO THE SECOND AMENDED AND RESTATED CREDIT AGREEMENT
(this "Amendment") is dated as of the 30th day of March, 2000, and entered into
among Telergy Operating, Inc., a Delaware corporation (the "Borrower"), the
Lenders (as defined below) and Bank of America, N.A., as a Lender and
Administrative Agent.
WITNESSETH:
WHEREAS, the Borrower, the Lenders and the Administrative Agent entered
into a Second Amended and Restated Credit Agreement, dated as of November 19,
1999 (as amended, and as further amended, restated or otherwise modified from
time to time, the "Credit Agreement");
WHEREAS, Borrower has informed Administrative Agent that the Borrower has
requested certain amendments to the Credit Agreement;
WHEREAS, the Lenders, the Administrative Agent and the Borrower have
agreed upon the terms and conditions set forth below;
NOW, THEREFORE, for valuable consideration hereby acknowledged, the
Borrower, the Lenders and the Administrative Agent agree as follows:
SECTION 1.
(a) Definitions, in general. Unless specifically defined or redefined
below, capitalized terms used herein shall have the meanings ascribed thereto in
the Credit Agreement.
(b) Definition of "Series B Certificate of Designation". A new definition
of "Series B Certificate of Designation" is added to Article I of the Credit
Agreement in alphabetical order as follows:
"Series B Certificate of Designation" means that certain Certificate
of Designation for Series B Convertible Redeemable Preferred Stock of
Telergy, Inc., to be executed by it and filed with Secretary of State of
the State of Delaware.
(c) Definition of "Series B Preferred". A new definition of "Series B
Preferred" is added to Article I of the Credit Agreement in alphabetical order
as follows:
"Series B Preferred" means 52,220 shares to be sold for $383.00 per
share of that Series B Convertible Redeemable Preferred Stock, par value
$.0001 per share.
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(d) The definition of "Subsidiary" in Article I of the Credit Agreement is
hereby amended to read in its entirety as follows:
"Subsidiary" means, with respect to any Person (herein referred to
as the "parent"), any corporation, partnership, limited liability company,
association or other business entity of which securities or other
ownership interests representing more than 50% of the equity or more than
50% of the ordinary voting power or more than 50% of the general
partnership interests are, at the time any determination is being made,
owned, controlled or held, by the parent or one or more Subsidiaries of
the parent or by the parent and one or more Subsidiaries of the parent;
provided that Telergy NJ, LLC shall not be considered a Subsidiary for
purposes of this Agreement.
SECTION 2. Amendment to Section 2.06(b). Section 2.06(b) of the Credit
Agreement is amended and restated in its entirety as follows:
(b) Mandatory Prepayments. The Borrower shall make an immediate and
mandatory prepayment of the Loan and/or cash collateralization of the
Letters of Credit by an amount in each case equal to: (i) 100% of the net
cash proceeds from the issuance of any equity or Capital Stock by the
Parent or any of its Subsidiaries (whether as a result of the exercise of
a Stock Right or otherwise), except (A) Capital Stock of the Parent issued
(I) pursuant to the Private Offering, (II) pursuant to the Conversion
Rights Agreement, (III) in accordance with any Stock Plan, (IV) pursuant
to any Stock Rights existing on the Closing Date, and (V) the Series B
Preferred, or (B) Capital Stock of Telergy Canada issued to comply with
applicable Law of Canada, (ii) 100% of the Net Proceeds from Asset
Dispositions and Fiber Dispositions by the Parent, the Borrower or any of
their Subsidiaries (specifically excluding Fiber Dispositions not
prohibited by the terms of Section 7.15 hereof) (this section in and of
itself not permitting any such transactions, for permitted Asset
Dispositions, see Section 7.06 hereof and for prohibited Fiber
Dispositions, see Section 7.15 hereof), provided that no prepayment must
be made for Asset Dispositions (A) in the ordinary course of business, (B)
among the Parent, the Borrower and their Wholly Owned Subsidiaries or
Telergy Central and (C) the Net Proceeds of which aggregate in an amount
over the term of this Agreement less than $1,000,000; (iii)100% of the net
proceeds received by the Parent, the Borrower or their Subsidiaries in
connection with the incurrence of Debt for Borrowed Money of the Parent,
the Borrower or any of their Subsidiaries after the date hereof (this
section in and of itself not permitting any such transactions, for
permitted debt incurrence see Section 7.02 hereof) except with respect to
the incurrence by the Borrower of Debt for Borrowed Money in accordance
with the terms of Section 7.02 hereof; and (iv) 100% of the Obligations if
a Change in Control occurs.
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SECTION 3. Addition of Section 6.01(d) of the Credit Agreement . A new
Section 6.01(d) shall be added to the Credit Agreement as follows:
(d) All leases entered into by the Borrower or any of the Borrower's
or the Parent's Subsidiaries after March 15, 2000 on which Property of the
Borrower or its Subsidiaries valued in excess of $500,000 in the aggregate
is located shall be subject to a landlord's waiver for the benefit of, and
in form and substance acceptable to, the Administrative Agent and the
Lenders. Additionally, in connection with such leases, the Borrower shall
use (and shall cause the Borrower's and the Parent's Subsidiaries to use)
commercially reasonable best efforts to obtain legal descriptions and
permission for the Administrative Agent, for itself and each of the
Lenders, to file a fixture filing for each such leased property on which
Property of the Borrower or the Borrower's and the Parent's Subsidiaries
valued in excess of $500,000 in the aggregate is located. The Borrower
further agrees to assist the Administrative Agent in preparing and filing
any such UCC-1 fixture filing financing statements on such properties.
SECTION 4. Amendment of Sections 7.05(d) and 7.05(e) of the Credit
Agreement and addition of new Section 7.05(f) to the Credit Agreement . Sections
7.05(d) and 7.05(e) of the Credit Agreement are deleted in their entirety and
the following Sections 7.05(d) and 7.05(e) are added in their stead together
with a new Section 7.05(f) as follows:
(d) So long as there exists no Default or Event of Default
both immediately before and immediately after making any such
Investment, additional Investments in Telergy East of up to
$4,000,000 in the aggregate during the term of this Agreement;
(e) Investments consisting of loans or advances by the Parent,
the Borrower or any of their Subsidiaries to employees or directors
of the Parent, Borrower or their Subsidiaries, provided that in each
case, such loans or advances are made in the ordinary course of
business and in accordance with the past practices of the Parent,
the Borrower or such Subsidiary, and in any case, not in excess of
$2,000,000 outstanding at any one time, excluding with respect to
the calculation of such amount, loans to purchase the Capital Stock
of the Parent under the Stock Plan; and
(f) So long as there exists no Default or Event of Default
both immediately before and immediately after making any such
Investment and subject to the prior or contemporaneous sale of the
Series B Preferred, Investments in Telergy NJ, LLC of up to
$4,000,000 in the aggregate during the term of this Agreement.
SECTION 5. Amendment of Sections 7.07(i) and 7.07(j) of the Credit
Agreement and addition of new Section 7.07(k) to the Credit Agreement. Sections
7.07(i) and 7.07(j) of the Credit
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Agreement are deleted in their entirety and the following Sections 7.07(i) and
7.07(j) are added in their stead together with a new Section 7.07(k) as follows:
(i) so long as there exists no Default or Event of Default
both immediately before and immediately after giving effect thereto,
the Borrower may declare and pay dividends to the Parent in
connection with Debt for Borrowed Money of the Parent permitted
under the terms of this Agreement and ordinary course of business
operating expenses;
(j) the Parent, the Borrower and their Subsidiaries may repay
the Nortel Note with the proceeds of this Loan; and
(k) the Parent may make in kind Restricted Payments required
to be made by the Series B Certificate of Designation as in effect
on March , 2000 in the form presented to the Administrative Agent
and the Lenders and related issuances of common stock upon the
conversion of the Series B Preferred in accordance with the Series B
Certificate of Designation.
SECTION 6. Amendment to Section 7.10. Section 7.10 of the Credit Agreement
is amended and restated in its entirety as follows:
SECTION 7.10. Amendments to Organizational Documents and Material
Agreements. The Borrower will not, and will not cause or permit the Parent
or any of their Subsidiaries to, enter into any amendment of any term or
provision, or accept any consent or waiver with respect to any such
provision, of (a) its articles of incorporation, by-laws, the Operating
Agreement or its organizational documents, as applicable, in a manner that
adversely affects the interests of the Lenders; provided, that, (i)
Telergy Canada may amend its articles of incorporation and by-laws to the
extent necessary to consummate any Telergy Canada Reorganization, (ii)
Telergy Central may amend any of its organizational documents to the
extent necessary to consummate the Telergy Central Conversion, (iii) the
Parent may amend its articles of incorporation or by-laws to the extent
necessary to complete the Parent Merger or to increase the outstanding
shares of its Capital Stock or to effect a common Capital Stock split, and
(iv) the Parent may execute and file the Series B Certificate of
Designation, (b) any document evidencing Debt for Borrowed Money of the
Parent, the Borrower or their Subsidiaries in existence on the date
hereof, (c) documents and instruments evidencing indebtedness owed to M&T
Bank, (d) the documents and agreements evidencing Debt for Borrowed Money
executed in connection with the Nortel Credit Line, (e) the documents and
agreements evidencing Debt for Borrowed Money executed in connection with
the GATX Lease Agreement, (f) the documents and agreements evidencing Debt
for Borrowed Money executed in connection with any Interest Hedge
Agreements, (g) the documents and agreements evidencing Debt for Borrowed
Money permitted by Section 7.02(e) hereof, (h) the documents and
agreements evidencing Debt for Borrowed Money executed in connection with
Permitted Refinancing Indebtedness, (i) any agreement,
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document or instrument related to, or executed or delivered in connection
with, any equity interest or Capital Stock of the Parent, the Borrower or
their Subsidiaries in a manner that is adverse to the interests of the
Lenders, (j) any Right of Way Agreement, or (k) the Series B Certificate
of Designation.
SECTION 7. Amendment to Section 7.11. Section 7.11 of the Credit Agreement
is amended and restated in its entirety as follows:
SECTION 7.11. Issuances of Capital Stock. The Borrower shall not,
and shall not permit the Parent or any of their Subsidiaries to (a) make
or permit any transfer, assignment, distribution, mortgage, pledge or gift
of any shares of Capital Stock of the Parent, the Borrower or their
Subsidiaries, except to another Wholly Owned Subsidiary of the Parent or
the Borrower and (b) issue any Capital Stock or grant any Stock Rights,
except: (i) the Parent may issue Class A Capital Stock of the Parent in
accordance with the terms of the Stock Rights in existence on the Closing
Date and described on Schedule 7.11, (ii) so long as there exists no
Default or Event of Default both immediately before and immediately after
giving effect thereto, issuances by the Parent of its Class A Capital
Stock in connection with the Private Offering, so long as such issuance
does not cause a Change in Control, (iii) so long as here exists no
Default or Event of Default both immediately before and immediately after
giving effect thereto, Class A Capital Stock of the Parent issued pursuant
to the Stock Plan, so long as such issuance does not cause a Change in
Control, (iv) so long as there exists no Default or Event of Default both
immediately before and after giving effect thereto, payments in kind with
respect to dividends on the Global Preferred Stock or the Special Common
Stock, and (v) so long as there exists no Default or Event of Default both
immediately before and after giving effect thereto, the Series B
Preferred.
SECTION 8. Conditions Precedent. This First Amendment shall not be
effective until the Administrative Agent shall have received:
(a) executed signature pages from the Borrower, the Parent, Telergy
Parkway, the Administrative Agent and Majority Lenders;
(b) certified copies of resolutions authorizing the execution, delivery
and performance of this First Amendment; and
(c) such other documents, instruments, and certificates, in form and
substance satisfactory to the Administrative Agent and the Lenders,
as the Administrative Agent and the Lenders shall deem necessary or
appropriate in connection with this First Amendment and the
transactions contemplated hereby.
SECTION 9. Representations and Warranties. The Borrower represents and
warrants to the Lenders and the Administrative Agent that (a) this First
Amendment is a Loan Paper under the Credit Agreement and constitutes its legal,
valid, and binding obligation, enforceable in accordance
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with the terms hereof (subject as to enforcement of remedies to any applicable
bankruptcy, reorganization, moratorium, or other laws or principles of equity
affecting the enforcement of creditors' rights generally), (b) there exists no
Default or Event of Default under the Credit Agreement that has not been waived
by the Lenders, (c) its representations and warranties set forth in the Credit
Agreement and other Loan Papers are true and correct on the date hereof, (d) it
has complied with all agreements and conditions to be complied with by it under
the Credit Agreement and the other Loan Papers by the date hereof, and (e) the
Credit Agreement, as amended hereby, and the other Loan Papers remain in full
force and effect.
SECTION 10. Entire Agreement; Ratification. THE CREDIT AGREEMENT AS
AMENDED HEREBY AND THE OTHER LOAN PAPERS REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENT OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES. EXCEPT AS MODIFIED OR SUPPLEMENTED HEREBY, THE CREDIT
AGREEMENT, THE OTHER LOAN PAPERS AND ALL OTHER DOCUMENTS AND AGREEMENTS EXECUTED
IN CONNECTION THEREWITH SHALL CONTINUE IN FULL FORCE AND EFFECT.
SECTION 11. Counterparts. This First Amendment may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument. In making proof hereof, it shall not be necessary to produce or
account for any counterpart other than one signed by the party against which
enforcement is sought.
SECTION 12. JURISDICTION; CONSENT TO SERVICE OF PROCESS.
(A) THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY NEW YORK STATE COURT OR FEDERAL COURT OF THE
UNITED STATES OF AMERICA SITTING IN NEW YORK, NEW YORK AND ANY APPELLATE COURT
FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN PAPER, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, IN
SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN
ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN PAPER SHALL AFFECT ANY RIGHT THAT
THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR
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ANY OTHER LOAN PAPER AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.
(B) THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND
EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OTHER LOAN PAPER IN ANY NEW YORK STATE OR FEDERAL COURT.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(C) EACH PARTY TO THIS AGREEMENT AND ANY OTHER LOAN PAPER IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 12
HEREOF. NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN PAPER WILL AFFECT THE RIGHT
OF ANY PARTY TO THIS AGREEMENT OR ANY OTHER LOAN PAPER TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW.
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THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
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IN WITNESS WHEREOF, this First Amendment to Credit Agreement is executed
as of the date first set forth above.
THE BORROWER:
TELERGY OPERATING, INC.
/s/ ▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
By: ▇▇▇▇▇ ▇▇▇▇▇
------------------------------------
Its: President
------------------------------------
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THE ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A.,
as Administrative Agent
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________________
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
THE LENDERS:
SPECIFIED BANK OF AMERICA, N.A.,
PERCENTAGE ON THE CLOSING: individually as a Lender
DATE: 28.57142857143%
Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________________
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇ Title: Managing Director
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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SPECIFIED TORONTO DOMINION (TEXAS), INC.
PERCENTAGE ON THE CLOSING: individually as a Lender
DATE: 28.57142857143%
Address:
__________________________
__________________________
__________________________ ________________________________________
By:_____________________________________
Attn:_____________________
Title:__________________________________
Telephone:________________
Telecopy:_________________
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SPECIFIED CIBC INC.
PERCENTAGE ON THE CLOSING: individually as a Lender
DATE: 22.85714285714%
Address:
__________________________
__________________________
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
__________________________ ________________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇
By:_____________________________________
Attn:_____________________
Executive Director
Title:__________________________________
Telephone:________________
Telecopy:_________________
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SPECIFIED ROYAL BANK OF CANADA,
PERCENTAGE ON THE CLOSING: individually as a Lender
DATE: 20.000000000%
Address:
__________________________
__________________________
__________________________ ________________________________________
By:_____________________________________
Attn:_____________________
Title:__________________________________
Telephone:________________
Telecopy:_________________
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THE GUARANTORS:
ACKNOWLEDGED AND AGREED:
TELERGY, INC.
/s/ ▇▇▇▇▇ ▇▇▇▇▇
________________________________________
By: ▇▇▇▇▇ ▇▇▇▇▇
_____________________________________
Its:____________________________________
TELERGY PARKWAY, INC.
/s/ ▇▇▇▇▇ ▇▇▇▇▇
________________________________________
By: ▇▇▇▇▇ ▇▇▇▇▇
_____________________________________
Its:____________________________________
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