______________________________________________________________________________
U.S.$8,000,000
BRIDGE LOAN AGREEMENT
Dated as of May 16, 1997
STAR DIGITEL LIMITED
AS BORROWER
and
THE TORONTO-DOMINION BANK
AS LENDER
________________________________________________________________
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS 1
SECTION 1.01. Certain Defined Terms 1
SECTION 1.02. Computation of Time Periods 11
SECTION 1.03. Accounting Terms 11
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES 11
SECTION 2.01. The Advances 11
SECTION 2.02. Making the Advances 12
SECTION 2.03. Fees 12
SECTION 2.04. Repayment 12
SECTION 2.05. Interest 13
SECTION 2.06. Optional Prepayments 13
SECTION 2.07. Increased Costs 14
SECTION 2.08. Illegality 15
SECTION 2.09. Payments and Computations 15
SECTION 2.10. Taxes 16
SECTION 2.11. Use of Proceeds 17
ARTICLE III
CONDITIONS TO EFFECTIVENESS AND LENDING 17
SECTION 3.01. Conditions Precedent to Effectiveness of
Section 2.01 17
SECTION 3.02. Conditions Precedent to Each Borrowing 20
ARTICLE IV
REPRESENTATIONS AND WARRANTIES 20
SECTION 4.01. Representations and Warranties of the
Borrower 20
ARTICLE V
COVENANTS OF THE BORROWER 23
SECTION 5.01. Affirmative Covenants 23
PAGE
SECTION 5.02. Negative Covenants 26
ARTICLE VI
EVENTS OF DEFAULT 29
SECTION 6.01. Events of Default 29
ARTICLE VII
MISCELLANEOUS 32
SECTION 7.01. Amendments, Etc. 32
SECTION 7.02. Notices, Etc. 32
SECTION 7.03. No Waiver; Remedies 32
SECTION 7.04. Costs and Expenses 33
SECTION 7.05. Right of Set-off 34
SECTION 7.06. Binding Effect 34
SECTION 7.07. Governing Law 34
SECTION 7.08. Execution in Counterparts 34
SECTION 7.09. Consent to Jurisdiction 35
SECTION 7.10. Judgment Currency 35
SECTION 7.11. Waiver of Jury Trial 36
SCHEDULES
Schedule 4.01(o) - Shares
Schedule 5.02(a)(iii) - Existing Liens
EXHIBITS
Exhibit A - Form of Promissory Note
Exhibit B - Form of Notice of Borrowing
Exhibit C-1 - Form of Guaranty from STHL
Exhibit C-2 - Form of Guaranty from VCFC
Dated as of May 16, 1997
STAR DIGITEL LIMITED, a company organized under the laws of Hong
Kong (the "BORROWER") and THE TORONTO-DOMINION BANK ("TORONTO DOMINION"), as
the lender (the "LENDER") agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this Agreement,
the following terms shall have the following meanings (such meanings to be
equally applicable to both the singular and plural forms of the terms
defined):
"ADVANCE" has the meaning specified in Section 2.01.
"AFFILIATE" means, as to any Person, any other Person that, directly
or indirectly, controls, is controlled by or is under common control
with such Person or is a director or officer of such Person. For
purposes of this definition, the term "control" (including the terms
"controlling", "controlled by" and "under common control with") of a
Person means the possession, direct or indirect, of the power to vote 5%
or more of the Voting Stock of such Person or to direct or cause the
direction of the management and policies of such Person, whether through
the ownership of Voting Stock, by contract or otherwise.
"APPLICABLE MARGIN" means, as of any date of determination, (a)
during the period from the Effective Date to the Initial Maturity Date,
2.25% and, subject to the Extension pursuant to Section 2.04(b), (b)
during the period thereafter until the Final Maturity Date, 2.50%.
"BORROWER" has the meaning specified in the preamble to this
Agreement.
"BORROWING" means a borrowing consisting of Advances made on the
same day by the Lender.
"BUSINESS DAY" means a day of the year on which banks are not
required or authorized by law to close in Hong Kong and Singapore and,
if the applicable Business Day relates to any Advance, on which dealings
are carried on in the London interbank market.
"CASH EQUIVALENTS" means (a) securities with maturities of one year
or less from the date of acquisition issued or fully guaranteed or
insured by the government of the
United States of America or any agency or instrumentality thereof; (b)
demand deposits, certificates of deposit, acceptances, and Eurodollar
time deposits with maturities of one year or less from the date of
acquisition and overnight bank deposits of any commercial bank
incorporated under the laws of the United States of America or any state
thereof and having, or having a direct or indirect parent corporation
that has, a long-term debt rating of at least "A" from Standard & Poor's
Ratings Group or a long-term debt rating of at least "A-2" from Xxxxx'x
Investors Service, Inc.; (c) repurchase obligations with a term not more
than 30 days for the underlying securities of the types described in
clause (a) above and with a counterparty that has a long-term debt
rating described in clause (b) above; and (d) commercial paper of a
United States of America issuer maturing no more than 270 days from the
date of creation thereof and currently having the highest rating
obtainable from either Standard & Poor's Ratings Group or Xxxxx'x
Investors Service, Inc.
"CELL SITE" means any transmitting/receiving station for wireless
telephony.
"COMMITMENT" has the meaning specified in Section 2.01.
"COMPLIANCE CERTIFICATE" means a compliance certificate in the form
and substance acceptable to the Lender signed on behalf of the Borrower
by a senior financial officer of the Borrower.
"CONSOLIDATED" means, with respect to any Person, the consolidation
of accounts in accordance with U.S. GAAP for such Person.
"DEBT" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of property or services
(other than trade payables not overdue by more than 60 days incurred in
the ordinary course of such Person's business), (c) all obligations of
such Person evidenced by notes, bonds, debentures or other similar
instruments, (d) all obligations of such Person created or arising under
any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of
the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), (e) all obligations
of such Person as lessee under leases that have been or should be, in
accordance with U.S. GAAP for such Person, recorded as Finance Leases,
(f) all obligations, contingent or otherwise, of such Person in respect
of acceptances, letters of credit or similar extensions of credit,
(g) all obligations of such Person in respect of Hedge Agreements,
(h) all Debt of others referred to in clauses (a) through (g) above or
clause (i) below guaranteed directly or indirectly in any manner by such
Person, or in effect guaranteed directly or indirectly by such Person
through an agreement (1) to pay or purchase such Debt or to advance or
supply funds for the payment or purchase of such Debt, (2) to purchase,
sell or lease (as lessee or lessor) property, or to purchase or sell
services, primarily for the purpose of enabling the debtor to make
payment of such Debt or to assure the holder of such Debt against loss,
(3) to supply funds to or in any other manner invest in the debtor
(including
any agreement to pay for property or services irrespective of whether
such property is received or such services are rendered) or
(4) otherwise to assure a creditor against loss, and (i) all Debt
referred to in clauses (a) through (h) above secured by (or for which
the holder of such Debt has an existing right, contingent or otherwise,
to be secured by) any Lien on property (including, without limitation,
accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Debt.
"DEFAULT" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"DOLLAR" or "$" means the lawful currency of the United States of
America.
"EFFECTIVE DATE" has the meaning specified in Section 3.01.
"ELECTION DATE" has the meaning specified in the Section 2.04(b).
"ENVIRONMENTAL ACTION" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental Law,
Environmental Permit or Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory
authority for enforcement, cleanup, removal, response, remedial or other
actions or damages and (b) by any governmental or regulatory authority
or any third party for damages, contribution, indemnification, cost
recovery, compensation or injunctive relief.
"ENVIRONMENTAL LAW" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, judgment, decree
or judicial or agency interpretation, policy or guidance relating to
pollution or protection of the environment, health, safety or natural
resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or
discharge of Hazardous Materials.
"ENVIRONMENTAL PERMIT" means any permit, approval, identification
number, license or other authorization required under any Environmental
Law.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and
rulings issued thereunder from time to time in effect.
"ERISA AFFILIATE" means any Person that for purposes of Title IV of
ERISA is a member of the Borrower's controlled group, or under common
control with the Borrower, within the meaning of Section 414 of the
Internal Revenue Code.
"ERISA EVENT" means (a) (i) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any Plan
unless the 30-day notice requirement with respect to such event has been
waived by the PBGC, or (ii) the requirements of clause (1) of Section
4043(b) of ERISA (without regard to clause (2) of such Section) are met
with a contributing sponsor, as defined in Section 4001(a)(13) of ERISA,
of a Plan, and an event described in paragraph (9), (10), (11), (12) or
(13) of Section 4043(c) of ERISA is reasonably expected to occur with
respect to such Plan within the following 30 days; (b) the application
for a minimum funding waiver with respect to a Plan; (c) the provision
by the administrator of any Plan of a notice of intent to terminate such
Plan pursuant to Section 4041(a)(2) of ERISA (including any such notice
with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of the Borrower or
any ERISA Affiliate in the circumstances described in Section 4062(e) of
ERISA; (e) the withdrawal by the Borrower or any ERISA Affiliate from a
Multiple Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions
for the imposition of a lien under Section 302(f) of ERISA shall have
been met with respect to any Plan; (g) the adoption of an amendment to a
Plan requiring the provision of security to such Plan pursuant to
Section 307 of ERISA; or (h) the institution by the PBGC of proceedings
to terminate a Plan pursuant to Section 4042 of ERISA, or the occurrence
of any event or condition described in Section 4042 of ERISA that
constitutes grounds for the termination of, or the appointment of a
trustee to administer, a Plan.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXTENSION" means the extension of the maturity of the Note pursuant
to Section 2.04(b).
"EXTENSION FEE" has the meaning specified in Section 2.03(b).
"FAIR MARKET VALUE" means, with respect to any property or asset
(including, without limitation, shares of capital stock) of any Person
on any date of determination, the value of the consideration obtainable
in a sale of such property or asset in the open market on such date
assuming an arm's-length sale that has been arranged without duress or
compulsion between a willing seller and a willing and knowledgeable
purchaser in a commercially reasonable manner over a reasonable period
of time under all conditions necessary or desirable for a fair sale
(taking into account the nature and characteristics of such property or
asset).
"FACILITY" has the meaning specified in Section 2.01.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers,
as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of
New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day on such
transactions received by the Lender from three Federal funds brokers of
recognized standing selected by it.
"FINAL MATURITY DATE" means the Initial Maturity Date, or if the
Extension is exercised by the Borrower in accordance with Section
2.04(b), May 11, 1998.
"FINANCE LEASES" means all leases that have or should be, in
accordance with U.S. GAAP, recorded as capital leases or finance
leases, as the case may be.
"GUARANTORS" means, collectively, STHL and VCFC.
"GUARANTIES" means, collectively, the STHL Guaranty and the VCFC
Guaranty.
"HAZARDOUS MATERIALS" means (a) petroleum and petroleum products,
byproducts or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas
and (b) any other chemicals, materials or substances designated,
classified or regulated as hazardous or toxic or as a pollutant or
contaminant under any Environmental Law.
"HEDGE AGREEMENTS" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"INITIAL MATURITY DATE" means November 12, 1997.
"INTEREST PERIOD" means, for each Advance comprising part of the
same Borrowing, the period commencing on the date of such Advance and
ending on the last day of the period selected by the Borrower pursuant
to the provisions below and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period
and ending on the last day of the period selected by the Borrower
pursuant to the provisions below. The duration of each such Interest
Period shall be one month upon notice received by the Lender not later
than 11:00 A.M. (Singapore time) on the third Business Day prior to the
first day of such Interest Period, select; PROVIDED, HOWEVER, that:
(i) the Borrower may not select any Interest Period that
ends after the Final Maturity Date;
(ii) Interest Periods commencing on the same date for
Advances comprising part of the same Borrowing shall be of the
same duration;
(iii) a maximum of three Borrowings shall be made available
to the Borrower during any Interest Period; and
(iv) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next
succeeding Business Day, PROVIDED, HOWEVER, that, if such extension
would cause the last day of such Interest Period to occur in the
next following calendar month, the last day of such Interest Period
shall occur on the next preceding Business Day; and
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"IWC" means International Wireless Communications, Inc., a Delaware
Corporation.
"IWC PLEDGE AGREEMENT" has the meaning specified in Section
3.01(h)(iv).
"LENDER" has the meaning specified in the preamble to this Agreement.
"LENDER'S ACCOUNT" means the account of the Lender's Account
maintained by the Lender at Bank of America, New York Branch with its
office at 1 World Trade Center, 00xx Xxxxx, Xxx Xxxx, XX, 00000-0000,
XXX, Account No. 6550 2-97469 CHIPS 361042.
"LENDING OFFICE" means, with respect to the Lender, Toronto-Dominion
(South East Asia) Limited, 0 Xxxxxxx Xxxxxx, #00-00 Xxxxxxxx Xxxxx,
Xxxxxxxxx 000000.
"LIBOR" means, for any Interest Period for each LIBOR Advance
subject to Section 2.07, (a) the British Bankers Association settlement
rate for such Interest Period for deposits in Dollars at or about 11:00
A.M. (London time) on the second Business Day prior to the first day of
such Interest Period, as shown on the Telerate Page 3750 (or such other
page which replaces that page for the purposes of displaying offered
rates for banks in the London interbank market in Dollars on that
service) on the Telerate Service on such day; (b) if no rate appears on
the Telerate Page 3750 (or other page which replaces that page for the
purpose of displaying offered rates for banks in the London interbank
market in Dollars on that service) for Dollars or for the relevant
Interest Period, "LIBOR" shall be the arithmetic mean, rounded upward to
the nearest whole multiple of 1/16 of 1% per annum, if such arithmetic
mean is not such multiple, of the rates for such Interest Period for
deposits in Dollars at or about 11:00 A.M. (London time) on the first
day of such Interest Period as shown on the LIBP page on the Reuters'
Service on that day; or (c) if no rate appears on either service
referred in clause (a) or (b) above, "LIBOR" shall be the arithmetic
mean, rounded upward to the nearest whole multiple of 1/16 of 1% per
annum, if such arithmetic mean is not such multiple, of the rates at
which deposits in Dollars of that amount for such Interest Period was
offered by Toronto Dominion to prime banks in the London interbank
market at or about 11:00 A.M. (London time) on the second Business day
prior to the first day of such period.
"LIEN" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance
on title to real property.
"LOAN DOCUMENTS" means, collectively, this Agreement, the Note, the
Guaranties, and the IWC Pledge Agreement.
"LOAN PARTIES" means, collectively, the Borrower, IWC and the
Guarantors.
"MATERIAL ADVERSE CHANGE" means any material adverse change in the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party or any of its Subsidiaries.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party and its Subsidiaries taken as
a whole, (b) the rights and remedies of the Lender under any Loan
Document or (c) the ability of any Loan Party to perform its obligations
under any Loan Document.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of
the Borrower or any ERISA Affiliate and at least one Person other than
the Borrower and the ERISA Affiliates or (b) was so maintained and in
respect of which the Borrower or any ERISA Affiliate could have
liability under Section 4064 or 4069 of ERISA in the event such plan has
been or were to be terminated.
"NET CASH PROCEEDS" means, with respect to any sale, lease, transfer
or other disposition of any asset or the sale or the issuance of any
Debt or capital stock or other ownership or profit interest, any
securities convertible into or exchangeable for capital stock or other
ownership or profit interest or any warrants, rights, options or other
securities to acquire capital stock or other ownership or profit
interest by any Person, the aggregate amount of cash received from time
to time (whether as initial consideration or through payment or
disposition of deferred consideration) by or on behalf of such Person in
connection with such transaction after deducting therefrom only (without
duplication) (a) reasonable and customary brokerage commissions,
underwriting fees and discounts, legal fees, finder's fees and other
similar fees and commissions and (b) the amount of taxes payable in
connection with or as a result of such transaction and (c) the amount of
any Debt secured by a Lien on such asset that, by the terms of such
transaction, is
required to be repaid upon such disposition, in each case to the extent,
but only to the extent, that the amount so deducted are, at the time of
receipt of such cash, actually paid to a Person that is not an Affiliate
of such Person or any Loan Party and are properly attributable to such
transaction or to the asset that is subject thereof.
"NOTE" means a promissory note of the Borrower payable to the order
of the Lender, in substantially the form of Exhibit A hereto, evidencing
the aggregate indebtedness of the Borrower to the Lender resulting from
the Advances made by the Lender.
"NOTICE OF BORROWING" has the meaning specified in Section 2.02.
"OBLIGATION" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether
or not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured,
and whether or not such claim is discharged, stayed or otherwise
affected by any proceeding referred to in Section 4.01(g).
"OPERATING LEASES" means all leases that have or should be, in
accordance with U.S. GAAP, recorded as operating leases.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PERMITTED DEBT" means, with the respect to the Borrower and its
Subsidiaries, (a) Debt of the Borrower under the Loan Documents and (b)
the indorsement of negotiable instruments for deposit or collection or
similar transaction in the ordinary course of business.
"PERMITTED INVESTMENTS" means, with respect to the Borrower,
(a) investments in Cash Equivalents; (b) extensions of trade credit to
the customers of the Borrower or any of its Subsidiaries, as the case
may be, in the ordinary course of business consistent with the
Borrower's or such Subsidiary's past practice; (c) purchases of
inventory occurring in the ordinary course of business consistent with
the Borrower's or such Subsidiary's past practice; (d) purchases of
assets in connection with Section 5.02(a)(ii); (e) negotiable
instruments held for collection, except to the extent that they would
constitute investments in Affiliates; (f) outstanding travel, moving and
other like advances to officers, employees and consultants; (g) lease,
utility and other similar deposits; or stock, obligations or securities
received in settlement of debts owing to the Borrower or a Subsidiary as
a result of foreclosure, perfection or enforcement of any Lien, in each
of the foregoing cases in the ordinary course of business of the
Borrower or any of its Subsidiaries, as the case may be; (h) sales of
goods or services on trade credit terms consistent with the Borrower's
and its Subsidiaries' past practices or as otherwise consistent with
trade credit terms in common use in the industry; (i) loans or advances
to
vendors or contractors of the Borrower that do not exceed an aggregate
amount at any time outstanding of $1,000,000 (or the equivalent in any
other currency); and (j) loans or capital contributions made in cash or
other assets in respect of the Borrower's total amount of investment in
any Subsidiary organized as a Sino-foreign cooperative joint venture
under the "Law of the People's Republic of China on Sino-Foreign
Cooperative Joint Ventures," as re-enacted, amended or extended from
time to time.
"PERMITTED LIENS" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall
have been commenced: (a) Liens for taxes, assessments and governmental
charges or levies to the extent not required to be paid under
Section 5.01(f); (b) Liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's Liens and other similar
Liens arising in the ordinary course of business securing obligations
that are not overdue for a period of more than 30 days; (c) pledges or
deposits to secure obligations under workers' compensation laws or
similar legislation or to secure public or statutory obligations; and
(d) easements, rights of way and other encumbrances on title to real
property that do not render title to the property encumbered thereby
unmarketable or materially adversely affect the use of such property for
its present purposes.
"PERSON" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association,
joint venture, limited liability company or other entity, or a
government or any political subdivision or agency thereof.
"PLAN" means a Single Employer Plan or a Multiple Employer Plan.
"REFINANCING" has the meaning specified in Section 3.01(h)(ix).
"SHAREHOLDERS" means, collectively, STHL, IWC and Vanguard China,
Inc., a Delaware corporation.
"SHARES" means, with respect to the Borrower, capital stock or any
warrants, rights or options to acquire any such capital stock of the
Borrower.
"SINGLE EMPLOYER PLAN" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of
the Borrower or any ERISA Affiliate and no Person other than the
Borrower and the ERISA Affiliates or (b) was so maintained and in
respect of which the Borrower or any ERISA Affiliate could have
liability under Section 4069 of ERISA in the event such plan has been or
were to be terminated.
"STHL" means Star Telecom Holding Limited, a corporation organized
under the laws of Hong Kong.
"STHL GUARANTY" has the meaning specified in Section 3.01(h)(ii).
"SUBSIDIARY" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in
which) more than 50% of (a) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall or
might have voting power upon the occurrence of any contingency), (b) the
interest in the capital or profits of such limited liability company,
partnership or joint venture or (c) the beneficial interest in such
trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"TERMINATION DATE" means the earlier of the 30th day immediately
following the Effective Date and the date of termination in whole of the
Commitments pursuant to Section 6.01.
"TORONTO DOMINION" has the meaning specified in the preamble to this
Agreement.
"U.S. GAAP" has the meaning specified in Section 1.03.
"VCFC" means Vanguard Cellular Financial Corp., a North Carolina
corporation.
"VCFC GUARANTY" has the meaning specified in Section 3.01(h)(iii).
"VOTING STOCK" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening
of such a contingency.
SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement in
the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and
"until" each mean "to but excluding".
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the
preparation of the financial statements referred to in Section 4.01(e) ("U.S.
GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. THE ADVANCES. The Lender agrees, on the terms and
conditions hereinafter set forth, to make advances (the "ADVANCES") to the
Borrower from time to time on any Business Day during the period from the
Effective Date until the Termination Date in an aggregate amount not to
exceed at any time outstanding $8,000,000 (the "FACILITY" or, as the date
hereof, the "COMMITMENT"). Each Borrowing shall be in an aggregate amount of
$2,000,000 or an integral multiple of $1,000,000 in excess thereof. Each
Borrowing shall consist of Advances made on the same day by the Lender. The
Borrower acknowledges and agrees that the Lender shall not provide more than
three Borrowings under the Facility.
SECTION 2.02. MAKING THE ADVANCES.
(a) Each Borrowing shall be made on notice from the Borrower, which
notice shall be received by the Lender, not later than 11:00 A.M. (Singapore
time) on the third Business Day prior to the date of the proposed Borrowing.
Such notice (each, a "NOTICE OF BORROWING") shall be irrevocable and binding
on the Borrower, and shall be given in writing, in substantially the form of
Exhibit B hereto, specifying therein the requested (i) date of such
Borrowing, (ii) the aggregate amount of such Borrowing, and (iii) the initial
Interest Period for each such Advance. No later than 11:00 A.M. (Singapore
time) on the date of such Borrowing, and upon fulfillment of the applicable
conditions set forth in Article III, the Lender shall make available, in
immediately available funds by crediting an account at Societe Generale, New
York Branch, Account No. 00000000, for the account of the Borrower (or such
other account which may be specified to the Lender in writing) for further
credit to Societe Generale, Hong Kong Branch, Account No.
081-842-02-34002-0081-01-7 in the amount of such Borrowing, net of any fees,
expenses or other amounts owing to any Lender by the Borrower on the date of
such Borrowing.
(b) The Borrower shall indemnify the Lender against any loss, cost
or expense incurred by the Lender as a result of any failure to fulfill on or
before the date specified in such Notice of Borrowing for such Borrowing the
applicable conditions set forth in Article III, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by the Lender to fund
such Borrowing when such Borrowing, as a result of such failure, is not made
on such date. A certification as to such amounts, submitted by the Lender,
shall be conclusive and binding for all purposes, absent manifest error.
SECTION 2.03. FEES.
(a) COMMITMENT FEE. The Borrower agrees to pay the Lender for its
account a commitment fee on the unused portion of the Facility from the date
hereof until the Termination Date at a rate per annum equal to 0.5% per
annum, payable in arrears, on the Termination Date.
(b) EXTENSION FEE. Subject to Section 2.04(b), the Borrower agrees
to pay the Lender for its account an extension fee equal to $100,000 (the
"EXTENSION FEE") at the Extension Date.
SECTION 2.04. REPAYMENT.
(a) Subject to Section 2.04(b), the Borrower shall repay to the
Lender on the Final Maturity Date the aggregate principal amount of the
Advances then outstanding.
(b) The Borrower may, at any time prior to the 30th day preceding
the Initial Maturity Date, request in writing that the maturity of the Note
be extended to the Final Maturity Date (the "EXTENSION"). Within 14 days of
such request, the Lender shall notify the Borrower of its decision, which
shall be in its sole discretion, with respect to the Extension (such day
being the "ELECTION DATE"). If, as of the Election Date, the Lender elects
to extend the maturity of the Note, the Note shall be extended to the Final
Maturity Date, PROVIDED that at the date of such Election Date (i) the Note
is outstanding, (ii) no Default or Event of Default shall have occurred and
be continuing and (iii) all fees, expenses and other payments due to the
Lender in connection with the Extension or otherwise shall be paid in full in
cash.
SECTION 2.05. INTEREST.
(a) SCHEDULED INTEREST. The Borrower shall pay interest on the
unpaid principal amount of the Advance owing to the Lender from the date of
such Advance until such principal amount shall be paid in full, at a rate per
annum equal at all times during each Interest Period for such Advance to the
sum of (i) LIBOR for such Interest Period for such Advance PLUS (ii) the
Applicable Margin in effect from time to time, payable in arrears on the last
day of such Interest Period.
(b) DEFAULT INTEREST. Upon the occurrence and during the
continuance of an Event of Default, the Borrower shall pay, on demand,
(i) the interest on the unpaid principal amount of each Advance owing to the
Lender, payable in arrears on the dates referred to in clause (a) above, at a
rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid on such Advance pursuant to clause (a) above and (ii) to
the fullest extent permitted by law, the interest on the amount of any
interest, fee or other amount payable hereunder that is not paid when due,
from the date such amount shall be due until such amount shall be paid in
full, at a rate per annum equal at all times to 2% per annum above the rate
per annum required to be paid on the Advances pursuant to clause (a) above
during such period.
(c) NOTICE OF INTEREST RATE. Promptly after receipt of a Notice of
Borrowing pursuant to Section 2.02(a), the Lender shall give notice to the
Borrower and the applicable interest rate determined by the Lender for
purposes of clause (a) above.
SECTION 2.06. OPTIONAL PREPAYMENTS.
(a) The Borrower may, upon at least 30 Business Days' notice to the
Lender stating the proposed date and aggregate principal amount of the
prepayment, and if such notice is given the Borrower shall, prepay the
outstanding principal amount of the Advances comprising part of the same
Borrowing in whole or on part, together with accrued interest to the date of
such prepayment on the principal amount prepaid; PROVIDED, HOWEVER, that
(x) each partial
prepayment shall be in an aggregate principal amount of $2,000,000 or an
integral multiple of $100,000 in excess thereof and (y) the Borrower shall be
obligated to reimburse the Lender in respect thereof pursuant to
Section 7.04(c).
(b) MANDATORY.
(i) Upon the sale, lease, transfer or other disposition of any
assets of the Borrower or any of its Subsidiaries (other than under
clauses (i) and (ii) of Section 5.02(k)), the Borrower shall prepay the
then aggregate unpaid principal amount of Advances in an amount equal to
the lesser of (A) the then outstanding principal amount of such Advances
and (B) the amount of such Net Proceeds from such sale, lease, transfer
or other disposition, in either case together with accrued interest to
the date of such prepayment on the principal amount prepaid and all
fees, expenses and other payments due to the Lender under the Loan
Documents.
(ii) Upon receipt by the Borrower or any of its Subsidiaries of
the Net Proceeds from (A) the incurrence or issuance by the Borrower or
any of its Subsidiaries of any Debt or (B) the sale or issuance by the
Borrower or any of its Subsidiaries of any capital stock, any securities
convertible into or exchangeable for capital stock, any securities
convertible into or exchangeable for capital stock or any warrants,
rights or options to acquire capital stock, debt or equity securities,
the Borrower shall prepay the then outstanding principal amount of the
Advances, together with accrued interest to the date of such prepayment
on the principal amount prepaid and all fees, expenses and other
payments due to the Lender under the Loan Documents.
SECTION 2.07. INCREASED COSTS.
(a) If, due to either (i) the introduction of or any change in or
in the interpretation of any law or regulation or (ii) the compliance with
any guideline or request from any central bank or other governmental
authority (whether or not having the force of law), there shall be any
increase in the cost to the Lender of agreeing to make or making, funding or
maintaining Advances (excluding for purposes of this Section 2.07 any such
increased costs resulting from (i) Taxes or Other Taxes (as to which Section
2.10 shall govern) and (ii) changes in the basis of taxation of overall net
income or overall gross income by the United States or by the foreign
jurisdiction or state under the laws of which the Lender is organized or has
its Lending Office or any political subdivision thereof), then the Borrower
shall from time to time, upon demand by the Lender, pay to the Lender
additional amounts sufficient to compensate the Lender for such increased
cost. A certificate as to the amount of such increased cost, submitted to
the Borrower by the Lender, shall be conclusive and binding for all purposes,
absent manifest error.
(b) If the Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or
would affect the amount of capital required or expected to be maintained by
the Lender or any corporation controlling the Lender and that the amount of
such
capital is increased by or based upon the existence of the Lender's
commitment to lend hereunder and other commitments of this type, then, upon
demand by the Lender, the Borrower shall pay to the Lender, from time to time
as specified by the Lender, additional amounts sufficient to compensate the
Lender or such corporation in the light of such circumstances, to the extent
that the Lender reasonably determines such increase in capital to be
allocable to the existence of the Lender's commitment to lend hereunder. A
certificate as to such amounts submitted to the Borrower by the Lender shall
be conclusive and binding for all purposes, absent manifest error.
SECTION 2.08. ILLEGALITY. Notwithstanding any other provision of
this Agreement, if the Lender shall notify the Borrower that the introduction
of or any change in or in the interpretation of any law or regulation makes
it unlawful, or any central bank or other governmental authority asserts that
it is unlawful, for the Lender or its Lending Office to perform its
obligations hereunder to make Advances or to fund or maintain Advances
hereunder, the obligation of the Lender to make, fund or maintain Advances
shall be suspended until the Lender shall notify the Borrower that the
circumstances causing such suspension no longer exist.
SECTION 2.09. PAYMENTS AND COMPUTATIONS.
(a) The Borrower shall make each payment hereunder and under the
Notes only and exclusively in Dollars and in immediately available funds not
later than the time specified herein or therein therefor, or if no time is
specified, by not later than 11:00 A.M. (Singapore time) on the day when due
for the account of the Lender at the Lender's Account (or such other account
which may be specified to the Borrower in writing).
(b) All computations of interest and fees shall be made by the
Lender on the basis of a year of 360 days, in each case for the actual number
of days (including the first day but excluding the last day) occurring in the
period for which such interest or fees are payable. Each determination by
the Lender. of an interest rate or fee hereunder and under the Note shall be
conclusive and binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder or under the Note shall be
stated to be due on a day other than a Business Day, such payment shall be
made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of payment of interest or any fee,
as the case may be; PROVIDED, HOWEVER, that, if such extension would cause
payment of interest on or principal of Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(d) The Borrower hereby authorizes the Lender, if and to the extent
payment owed to the Lender is not made when due hereunder or under the Note
held by the Lender, to charge from time to time against any or all of the
Borrower's accounts with the Lender any amount so due.
(e) To the fullest extent permitted by law, the Borrower shall make
all payments hereunder and under the Note regardless of any defense or
counterclaim, including, without limitation, any defense or counterclaim
based on any law, rule or policy which is now or
hereafter promulgated by any governmental authority or regulatory body and
which may adversely affect the Borrower's obligation to make, or the right of
the holder of the Note to receive, such payments.
(f) The obligation of the Borrower to make payments hereunder and
under the Note in Dollars when due in accordance with this Section 2.09 is
absolute.
SECTION 2.10. TAXES.
(a) Any and all payments by the Borrower hereunder or under the
Note shall be made, in accordance with Section 2.10, free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, EXCLUDING taxes imposed on its overall net income, and franchise
taxes imposed on it in lieu of net income taxes, by the jurisdiction under
the laws of which the Lender is organized or has its Lending Office or any
political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of payments
hereunder or under the Note being hereinafter referred to as "TAXES"). If
the Borrower shall be required by law to deduct any Taxes from or in respect
of any sum payable hereunder or under the Note to the Lender, (i) the sum
payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums
payable under this Section 2.10) the Lender receives an amount equal to the
sum it would have received had no such deductions been made, (ii) the
Borrower shall make such deductions and (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or
similar levies that arise from any payment made hereunder or under the Note
or from the execution, delivery or registration of, performing under, or
otherwise with respect to, this Agreement or the Note (hereinafter referred
to as "OTHER TAXES").
(c) The Borrower shall indemnify the Lender for and hold it
harmless against the full amount of Taxes or Other Taxes (including, without
limitation, taxes of any kind imposed by any jurisdiction on amounts payable
under this Section 2.10) imposed on or paid by the Lender and any liability
(including penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be made within
30 days from the date the Lender makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the
Borrower shall furnish to the Lender, at its address referred to in
Section 7.02, the original or a certified copy of a receipt evidencing such
payment. In the case of any payment hereunder or under the Note by or on
behalf of the Borrower through an account or branch outside the United States
or by or on behalf of the Borrower by a payor that is not a United States
person, if the Borrower determines that no Taxes are payable in respect
thereof, the Borrower shall furnish, or shall cause such payor to furnish, to
the Lender, an opinion of counsel acceptable to the Lender stating that such
payment is exempt from Taxes. For purposes of this clause (d) and
clause (e), the terms "UNITED STATES" and "UNITED STATES PERSON" shall have
the meanings specified in Section 7701 of the Internal Revenue Code.
(e) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained
in this Section 2.10 shall survive the payment in full of all amounts due
hereunder and under the Note.
SECTION 2.11. USE OF PROCEEDS. The proceeds of the Advances shall
be available (and the Borrower agrees that it shall use such proceeds) solely
for general corporate purposes of the Borrower.
ARTICLE III
CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION
2.01. Section 2.01 of this Agreement shall become effective on and as of the
first date (the "EFFECTIVE DATE") on which the following conditions precedent
have been satisfied:
(a) There shall have occurred no Material Adverse Change since
December 31, 1996.
(b) There shall exist no action, suit, investigation, litigation or
proceeding affecting the Loan Parties or any of their Subsidiaries pending or
threatened before any court, governmental agency or arbitrator that (i) could
be reasonably likely to have a Material Adverse Effect or (ii) purports to
affect the legality, validity or enforceability of this Agreement or the Note
or the consummation of the transactions contemplated hereby.
(c) The Lender shall have completed a due diligence investigation
of the Loan Parties and their Subsidiaries in scope, and with results,
satisfactory to the Lender; without limiting the generality of the foregoing,
the Lender shall have been given such access to the management, records,
books of account, contracts and properties of the Loan Parties and its
Subsidiaries as it shall have requested.
(d) All governmental and third party consents and approvals
necessary in connection with the transactions contemplated hereby shall have
been obtained (without the imposition of any conditions that are not
acceptable to the Lender) and shall remain in effect, and no law or
regulation shall be applicable in the reasonable judgment of the Lender that
restrains, prevents or imposes materially adverse conditions upon the
transactions contemplated hereby.
(e) The Borrower shall have paid all reasonable accrued fees and
expenses of the Lender (including the accrued fees and expenses of counsel to
the Lender).
(g) On the Effective Date, (i) the representations and warranties
shall be true and correct in all material respects on and as of such date
(other than any such representation and warranties that, by their terms,
refer to a specific date other than the Effective Date, in which case such
specific date); and (ii) no event shall have occurred and shall be continuing
that constitutes a Default.
(h) The Lender shall have received on or before the Effective Date
the following, each dated such day, in form and substance satisfactory to the
Lender and in sufficient copies for the Lender:
(i) The Note to the order of the Lender.
(ii) A guaranty of STHL, substantially in the form of Exhibit C-1
hereto, as amended, supplemented or otherwise modified from time to time
in accordance with its terms and with the terms of the other Loan
Documents (the "STHL GUARANTY"), duly executed and delivered by STHL.
(iii) A guaranty of VCFC, substantially in the form of Exhibit C-2
hereto, as amended, supplemented or otherwise modified from time to time
in accordance with its terms and with the terms of the other Loan
Documents (the "VCFC GUARANTY"), duly executed and delivered by VCFC.
Subject to the terms of the VCFC Guaranty, VCFC shall be subrogated to
the rights of the Lender resulting from the VCFC Guaranty.
(iv) Certified copies of the resolutions of the Board of Directors
of each Loan Party approving the Loan Documents to which it is a party,
and of all documents evidencing other necessary corporate action and
governmental approvals, if any, with respect thereto.
(v) A certificate of each Loan Party, signed on behalf of such
Loan Party by its President or a Vice President and the Secretary or
Assistant Secretary (the statements made in which certificate shall be
true on and as of the date of the Effective Date), certifying as to: (A)
true and complete copies of the charter and by-laws of such Loan Party
as in effect on the dates the resolutions specified in clause (ii) and
were adopted and the absence of any amendments to the charter or by-laws
since such dates; (B) the due incorporation and good standing of such
Loan Party in its respective jurisdiction of incorporation and the
absence of any proceeding for the dissolution or liquidation of such
Loan Party; (C) the truth of the representations and warranties made by
such Loan Party in each Loan Document to which it is a party; (D) in the
case of the Borrower the absence of any Event of Default or a Default;
and (E) in the case of the Borrower the satisfaction of all conditions
precedent by such Loan Party.
(vi) A signed copy of a certificate of the Secretary or an
Assistant Secretary or other appropriate officer of each Loan Party
certifying the names and true signatures of the officers of such Loan
Party authorized to sign each Loan Document to which such Loan Party is
a party, and the other documents to be delivered hereunder or thereunder.
(vii) (A) A favorable opinion of Winthrop, Stimson, Xxxxxx &
Xxxxxxx, special New York counsel for the Borrower;
(B) a favorable opinion of X. X. Xxxx & Co., special Hong
Kong counsel for the Borrower;
(C) a favorable opinion of X. X. Xxxx & Co., special Hong
Kong counsel for STHL;
(D) a favorable opinion of Xxxxxx & Xxxxxxx, special New
York counsel to VCFC; and
(E) a favorable opinion of Xxxxxxx Xxxxxx, Vice President-Law
for VCFC.
(viii) A favorable opinion of Shearman & Sterling, counsel for the
Lender, in form and substance satisfactory to the Lender.
(ix) Evidence, in form and substance satisfactory to the Lender,
that the Borrower shall use its best efforts to complete an offering and
sale of debt or equity securities of the Borrower or other financing
transactions referred to in Section 2.06(b), for the purpose of
refinancing the Facility (the "REFINANCING"), which shall yield an
amount sufficient to prepay the aggregate unpaid principal amount of the
Advances in full PLUS accrued interest thereon to the date of repayment
and all other amounts payable under the Loan Documents in accordance
with Section 2.06(b).
(x) Such other approvals, opinions or documents as the Lender may
reasonably request.
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING. The
obligation of the Lender to make an Advance on the occasion of each Borrowing
shall be subject to the conditions precedent that the Effective Date shall
have occurred and on the date of such Borrowing (a) the following statements
shall be true (and each of the giving of the applicable Notice of Borrowing
and the acceptance by the Borrower of the proceeds of such Borrowing shall
constitute a representation and warranty by the Borrower that on the date of
such Borrowing such statements are true):
(i) the representations and warranties contained herein are correct
on and as of the date of such Borrowing, before and after giving effect
to such Borrowing and to the application of the proceeds therefrom, as
though made on and as of such date, and
(ii) no event has occurred and is continuing, or would result from
such Borrowing or from the application of the proceeds therefrom, that
constitutes a Default;
and (b) the Lender shall have received such other approvals, opinions or
documents as the Lender may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER. The
Borrower represents and warrants as follows:
(a) DUE INCORPORATION, ETC. Each of the Borrower and its
Subsidiaries (i) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (ii) is duly
authorized to do business in which it owns or leases property or assets or in
which the conduct of its business requires it to be so authorized, and (iii)
has all requisite power and authority (A) to own or hold under lease and to
operate all of its property and assets and (B) to execute, deliver and
perform all its obligations under each Loan Document to which it is or will
be a party.
(b) CORPORATE POWER, ETC. Each of the Borrower and its
Subsidiaries has full corporate power and authority to enter into, deliver
and perform its obligations under each Loan Document to which it is or will
be a party and to consummate each of the transactions contemplated hereby and
thereby, and has taken all necessary corporate action to authorize the
execution, delivery and performance by it of each Loan Document to which it
is or will be a party. Each Loan Document to which any of the Borrower and
its Subsidiaries is or will be a party constitutes the legal, valid and
binding obligation of the Borrower or such Subsidiary, enforceable against
such the Borrower or such Subsidiary in accordance with its terms, except as
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws now or hereafter in effect affecting the
enforcement of creditors' rights generally and by general principles of
equity (regardless of whether enforcement is sought in a proceeding in equity
or at law).
(c) NO CONFLICT. Neither the execution and delivery of any Loan
Document to which any of the Borrower and its Subsidiaries is a party nor the
performance by the Borrower or such Subsidiary of its obligations thereunder,
nor the consummation of the transactions contemplated thereby will,
(i) conflict with the charter or by-laws of any of the Borrower or its
Subsidiaries, or (ii) conflict with or result in a breach of, or constitute a
default under, or result in the creation or imposition of any Lien upon any
of the property or assets of the Borrower or such Subsidiary under, any
applicable laws (including, without limitation, Regulation X issued by the
Board of Governors of the Federal Reserve System) or any indenture, mortgage,
deed of trust or other instrument or agreement to which the Borrower or such
Subsidiary may be or become a party or by which it may be or become bound or
to which any of the property or assets of the Borrower or such Subsidiary may
be subject.
(d) APPROVALS, ETC. No order, license, consent, authorization or
approval of, or exemption by, or notice to or registration with, any
governmental authority or regulatory body, and no filing, recording,
publication or registration in any public office or any other place, is
required in connection with the execution, delivery and performance by each
of the Borrower and its Subsidiaries of any Loan Document to which it is or
will be a party, or for the legality, validity, binding effect or
enforceability thereof.
(e) FINANCIAL STATEMENTS. The balance sheets of the Borrower as at
December 31, 1996, and the related statements of income and cash flows of the
Borrower for the fiscal year then ended, accompanied by an opinion of the
independent chartered or public accountants of the Borrower, copies of which
have been furnished to the Lender, fairly present the financial condition of
the Borrower as at such date and the results of the operations thereof for
the period ended on such date. All such financial statements, including the
related schedules and notes thereto, have been prepared in accordance with
U.S. GAAP for the Borrower applied consistently throughout the periods
involved.
(f) NO MATERIAL ADVERSE EFFECT. Since December 31, 1996, there has
been no, nor has there been threatened any, Material Adverse Effect (or any
development involving a prospective Material Adverse Effect).
(g) LITIGATION, ETC. There is no pending or threatened litigation,
investigation, action or proceeding of or before any court, arbitrator or
governmental agency (including any Environmental Action) binding upon or
affecting any of the Borrower or its Subsidiaries respective properties and
assets that (i) may cause a Material Adverse Effect to occur or (ii) purports
to affect the legality, validity or enforceability of any Loan Document.
(h) NO VIOLATION, ETC. Each of the Borrower and its Subsidiaries
is not in violation of, nor does the execution by the Borrower or such
Subsidiary of the Loan Documents to which such it is a party or the
consummation of the transactions contemplated thereby result in the violation
of, (i) any term of its charter or by-laws or (ii) any term of any other
agreement or instrument to which it is a party or by which it is bound in any
respect, which has or could be reasonably expected to have a Material Adverse
Effect.
(i) DEBT. At the time of and immediately after giving effect to
the Advances, there is no Debt other than Debt permitted under
Section 5.02(b).
(j) MARGIN STOCK. Each of the Borrower and its Subsidiaries is not
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock within the meaning of Regulations G, T and X issued by
the Board of Governors of the Federal Reserve System; and no part of the
proceeds of the Facility will be used to purchase or carry any margin stock
or extend credit to others for the purpose of purchasing or carrying any
margin stock.
(k) USE OF PROCEEDS. No proceeds of the Facility will be used to
acquire any equity security of a class which is registered pursuant to
Section 12 of the U.S. Securities Exchange Act of 1934, as amended.
(l) INVESTMENT COMPANY ACT AND PUBLIC UTILITY HOLDING COMPANY ACT.
Each of the Borrower and its Subsidiaries is not, and is not directly or
indirectly controlled by any Person which is, required to register as an
"investment company" within the meaning of the U.S. Investment Company Act of
1940, as amended. Neither the Borrower nor any of its Subsidiaries is a
"holding company" or a "subsidiary" or an "affiliate" of a "holding company"
or a "public utility" within the meaning of the U.S. Public Utility Holding
Company Act of 1935, as amended.
(m) TAXES. Each of the Borrower and its Subsidiaries has filed all
tax returns required to be filed by it and has paid all taxes, assessments,
fees and other charges (including interest and penalties) due with respect to
the years covered by such returns, except for any such failures to file or to
pay such amounts which, in the aggregate, would not have a Material Adverse
Effect.
(n) ENVIRONMENTAL LAWS. The operations and properties of each of
the Borrower and its Subsidiaries comply in all material respects with all
Environmental Laws, all necessary Environmental Permits have been obtained
and are in effect for the operations and properties of the Borrower and its
Subsidiaries, EXCEPT for such Environmental Permits where the failure to
obtain the same, in the aggregate, could not be reasonably expected to have a
Material Adverse Effect.
(o) SHAREHOLDERS. Set forth on Schedule 4.01(o) hereto is a
complete and accurate list of the owners of 100% of the Shares as of the date
hereof, specifying therein the number of Shares owned or controlled by each
of the Shareholders.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. AFFIRMATIVE COVENANTS. Each of the Borrower and its
Subsidiaries covenants and agrees (except in the case of covenants that do
not include the Borrower or any of its Subsidiaries) that so long as the
Lender shall have any Obligation under Section 2.01 or any amount is owing
under any Loan Document, unless the Lender shall otherwise consent in
writing, the Borrower shall and shall cause each of its Subsidiaries to:
(a) CORPORATE EXISTENCE. Preserve and maintain in full force and
effect its corporate existence, rights (charter and statutory), franchises
and privileges and qualify and remain qualified, as a corporation in good
standing in each jurisdiction in which such qualification is from time to
time necessary or desirable in view of its business and operations or the
ownership of its properties, except for such jurisdictions where the failure
to so qualify would
not have a Material Adverse Effect; PROVIDED, HOWEVER, that neither the
Borrower nor any of its Subsidiaries shall be required to preserve any right,
privilege or franchise if the Board of Directors thereof shall determine in
good faith that such right, privilege or franchise is no longer useful in the
conduct of the business of the Borrower or such Subsidiary, as the case may
be, and the loss thereof is not disadvantageous in any material respect to
the Lender.
(b) COMPLIANCE WITH LAWS. Comply in all material respects with all
applicable laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA.
(c) MAINTENANCE OF PROPERTY; INSURANCE. Preserve and maintain all
of its properties, owned or leased, that are used or useful in the conduct of
its business in good working order and condition, ordinary wear and tear
excepted; and maintain insurance with financially sound and reputable
insurers in such amounts and against such risks, as are usually and
customarily insured by companies engaged in a similar business with respect
to properties of a similar character.
(d) KEEPING OF BOOKS. Keep proper books of record and accounts, in
which full and correct entries shall be made of all financial transactions
and the assets and business of the Borrower and its Subsidiaries in
accordance with generally accepted accounting principles in effect from time
to time or as otherwise required by applicable rules and regulations of any
governmental agency or regulatory authority having jurisdiction over the
Borrower and any of its Subsidiaries.
(e) ACCESS TO RECORDS. Provide the Lender and its authorized
advisors and representatives reasonable access to all books, records, offices
and other facilities and properties of the Borrower and its Subsidiaries upon
reasonable notice, and allow the Lender or its authorized advisors or
representatives (as the case may be) to make such examinations thereof and
copies of and abstracts from such books and records as the Lender or its
authorized advisors or representatives (as the case may be) may reasonably
request.
(f) PAYMENT OF TAXES, ETC. Pay and discharge before the same shall
become delinquent (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims that,
if unpaid, might become a lien upon its property; PROVIDED, HOWEVER, that
neither the Borrower nor any of its Subsidiaries shall be required to pay or
discharge any such tax, assessment, charge or claim that is being contested
in good faith and by proper proceedings and as to which appropriate reserves
are being maintained, unless and until any Lien resulting therefrom attaches
to its property and becomes enforceable against its other creditors.
(g) TRANSACTIONS WITH AFFILIATES. Conduct, and cause each of its
Subsidiaries to conduct, all transactions otherwise permitted under the Loan
Documents with any of their Affiliates on terms that are fair and reasonable
and no less favorable to the Borrower or any of its Subsidiaries than it
would obtain in a comparable arm's-length transaction with a Person not an
Affiliate.
(h) FINANCIAL STATEMENTS, ETC.
(i) as soon as available and in any event within 45 days after the
end of each quarter of each fiscal year of the Borrower and its
Subsidiaries, furnish to the Lender and the Guarantors, without cost to
the Lender or the Guarantors, (A) quarterly unaudited Consolidated
balance sheets, statements of income and cash flows of the Borrower and
its Subsidiaries, all in reasonable detail and duly certified (subject
to normal year-end audit adjustments) by senior financial officer of the
Borrower as having been prepared in accordance with U.S. GAAP for the
Borrower and (B) a Compliance Certificate of the Borrower dated as of
the last day of such quarter, executed by such senior financial officer;
(ii) as soon as available and in any event within 90 days after the
end of each fiscal year of the Borrower and its Subsidiaries, furnish to
the Lender and the Guarantors, without cost to the Lender or the
Guarantors, (A) a copy of the annual audit report for such fiscal year
for the Borrower and its Subsidiaries, including therein Consolidated
balance sheets, statements of income and cash flows for such year
certified by independent chartered or public accountants satisfactory to
the Lender and (B) a Compliance Certificate of the Borrower dated as of
the last day of such year, executed by a senior financial officer
thereof;
(iii) furnish to the Lender and the Guarantors, without cost to the
Lender or the Guarantors, copies of all (A) documents and certificates
delivered to any other lender or holder of Debt promptly after delivery
thereof to such other lender or holder of Debt, and (B) reports which
the Borrower or any of its Subsidiaries sends to any of its security
holders, and copies of all reports and registration statements which the
Borrower or any of its Subsidiaries files with the Securities and
Exchange Commission or any national securities exchange; and
(iv) furnish to the Lender and the Guarantors, without cost to the
Lender or the Guarantors, any other information with respect to the
financial condition, business and property of the Borrower and its
Subsidiaries, as the Lender may from time to time reasonably request.
(i) NOTICE OF DEFAULTS. Promptly upon any officer of any of the
Borrower or its Subsidiaries obtaining knowledge thereof, give notice to the
Lender and the Guarantors, (i) of any development, including, without
limitation, any litigation, investigation or proceeding affecting the
Borrower or such Subsidiary, which has a Material Adverse Effect, could
reasonably be expected to have a Material Adverse Effect or, in the case of
any litigation, investigation or other proceeding, which could, if adversely
decided, reasonably be expected to have a Material Adverse Effect and (ii) of
a Default or Event of Default under the Loan Documents, each such notice
being in the form of an officers' certificate, signed by an authorized
officer of the Borrower or such Subsidiary, specifying the nature and period
of existence of any
such event and what action the Borrower or such Subsidiary, has taken, is
taking or proposes to take with respect thereto.
(j) REFINANCING. Use its best efforts to complete the Refinancing
prior to the Final Maturity Date, which Refinancing shall yield an amount
sufficient to repay the aggregate unpaid principal amount of the Advances in
full PLUS accrued interest thereon to the date of repayment and all other
amounts payable under the Loan Documents.
(k) COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply with all
Environmental Laws and Environmental Permits applicable to its operations and
properties, noncompliance with which could have a Material Adverse Effect;
obtain and renew all Environmental Permits necessary for its operations and
properties; and conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove
and clean up Hazardous Materials from any of its properties, in accordance
with the requirements of all applicable Environmental Laws; PROVIDED,
HOWEVER, that the Borrower or any of its Subsidiaries shall not be required
to undertake any such cleanup, removal, remedial or other action to the
extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect
to such circumstances.
SECTION 5.02. NEGATIVE COVENANTS. Each of the Borrower and its
Subsidiaries covenants and agrees (except in the case of covenants that do
not include the Borrower or any of its Subsidiaries) that so long as the
Lender shall have any obligation under Section 2.01 or any amount is owing
under any Loan Document, unless the Lender shall otherwise consent in
writing, the Borrower shall not and shall cause each of its Subsidiaries not
to:
(a) LIENS, ETC. Create or suffer to exist, or permit any of its
Subsidiaries to create or suffer to exist, any Lien on or with respect to any
of its properties, whether now owned or hereafter acquired, or assign, or
permit any of its Subsidiaries to assign, any right to receive income, other
than:
(i) Permitted Liens,
(ii) purchase money Liens upon or in any real property or equipment
acquired or held by the Borrower or any Subsidiary in the ordinary
course of business to secure the purchase price of such property or
equipment or to secure Debt incurred solely for the purpose of financing
the acquisition of such property or equipment, or Liens existing on such
property or equipment at the time of its acquisition (other than any
such Liens created in contemplation of such acquisition that were not
incurred to finance the acquisition of such property) or extensions,
renewals or replacements of any of the foregoing for the same or a
lesser amount, PROVIDED, HOWEVER, that no such Lien shall extend to or
cover any properties of any character other than the real property or
equipment being acquired, and no such extension, renewal or replacement
shall extend to or cover any properties not theretofore subject to the
Lien being extended, renewed or replaced, PROVIDED FURTHER that the
aggregate principal amount of the indebtedness secured by the Liens
referred to in this clause (ii) shall not exceed $150,000,000 (or the
equivalent in any other currency) at any time outstanding,
(iii) the Liens existing on the Effective Date and described on
Schedule 5.02(a)(iii) hereto,
(iv) Liens arising in connection with Finance Leases permitted under
Section 5.02(b)(iv); and
(v) the replacement, extension or renewal of any Lien permitted by
clause (iii) above upon or in the same property therefore subject
thereto or the replacement, extension or renewal (without increase in
the amount or change in any direct or contingent obligor)of the Debt
secured thereby.
(b) DEBT. Create, incur, assume or suffer to exist,
or permit any of its Subsidiaries to create, incur or suffer to
exist, any Debt other than:
(i) Permitted Debt;
(ii) Debt Secured by Liens permitted by Section 5.02(a)(ii) not to
exceed $150,000,000 (or the equivalent in any other currency) at anytime
outstanding;
(iii) Debt secured by Liens permitted by Section 5.02(a)(iii);
and
(iv) Finance Leases not to exceed in the aggregate $100,000,000 (or
the equivalent thereof in any other currency;
(c) LEASE OBLIGATIONS. Create, incur, assume or suffer to exist,
any obligations (other than Operating Leases of the Borrower or any of its
Subsidiaries in respect of any Cell Sites) as lessee (i) for the rental or
hire of real or personal property in connection with any sale and leaseback
transaction, or (ii) for the rental or hire of other real or personal
property of any kind under leases or agreements to lease including Finance
Lease having an original term of one year or more that would cause the direct
and contingent liabilities of the Borrower and its Subsidiaries, on a
Consolidated basis, in respect of all such obligations to exceed $10,000,000
(or the equivalent in any other currency payable in any period of 12
consecutive months.
(d) MERGERS, ETC. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its Subsidiaries to do
so, except that any Subsidiary of the Borrower may merge into or consolidate
with any other Subsidiary of the Borrower provided that, in the case of any
such merger or consolidation, the Person formed by such merger or
consolidation shall be a wholly-owed Subsidiary of the Borrower; PROVIDED,
HOWEVER, that in each case, immediately after giving effect thereto, no event
shall occur and be continuing that constitutes a Default.
(e) INVESTMENTS, LOANS, ADVANCES. Make any advance, loan, or
extension of credit to, or make any acquisitions or investments (whether by
way of transfers of property, contributions to capital, acquisitions of
stock, securities, evidences of indebtedness or otherwise)
in, or purchase any stock, bonds, notes, debentures or other securities of,
any other Person, except for Permitted Investments.
(f) OPERATE OTHER THAN IN ORDINARY COURSE. Operate its business,
other than in the usual and ordinary course and other than that which is
consistent with the past practice established by the Borrower or such
Subsidiary, as the case may be.
(g) DIVIDENDS, ETC. (i) Declare or make any dividend payment or
other distribution of assets, property, cash, rights, obligations or
securities (on account of any shares of capital stock of the Borrower or such
Subsidiary, or (ii) purchase, redeem, retire, defease or otherwise acquire
for value any shares of any class of the capital stock of the Borrower or
such Subsidiary as the case may be, or any warrants, rights or options to
acquire any such shares, now or hereafter outstanding; PROVIDED that nothing
in this Section 5.02(g) shall be deemed to prohibit cash dividends paid to
the Borrower by its wholly-owned Subsidiaries the proceeds of which are used
to repay the aggregate principal amount of Advances then outstanding.
(h) MERGER OR CONSOLIDATION. Merge into or consolidate with, or
convey, transfer, lease or otherwise dispose of (whether in one transaction
or in a series of transactions) all or substantially all of its assets
(whether now owned or hereafter acquired) to, or acquire all or substantially
all of the assets of, any Person, except that nothing in this Section 5.02(h)
shall prohibit (i) any direct or indirect wholly-owned Subsidiary of the
Borrower from merging into or consolidating with, or disposing of assets to,
or acquiring assets of, any other wholly-owned direct or indirect Subsidiary
of the Borrower, (ii) any Subsidiary of the Borrower from merging into or
disposing of assets to the Borrower and (iii) sales of assets otherwise
permitted under Section 5.02(k).
(i) RESTRICTION ON PAYMENTS AND TRANSFERS. Other than Liens
permitted under Section 5.02(a), create or otherwise cause or suffer to exist
or to become effective any consensual encumbrance or restriction on the
Borrower's or such Subsidiary's ability to (i) pay dividends or make
distributions of the Borrower's or such Subsidiaries' capital stock, as the
case may be, (ii) pay any debt owed to the Borrower or such Subsidiary,
(iii) make loans or advances to the Borrower or such Subsidiary or
(iv) transfer assets to, or create Liens in favor of, the Borrower or such
Subsidiary, as the case may be.
(j) AMENDMENTS OR WAIVERS. Amend, modify or change in any manner,
or waive any rights of the Borrower or any of its Subsidiaries pursuant to
the charter or by-laws (or other organizational documents) thereof, which, in
the reasonable judgment of the Lender, could adversely affect the Refinancing
or the Lender's rights and benefits under the Loan Documents and the
documents delivered pursuant thereto.
(k) SALES, ETC. OF ASSETS. Sell, lease, transfer or otherwise
dispose of any assets, except for:
(i) sales, leases, transfers and other dispositions of assets in
the ordinary course of business by the Borrower and such Subsidiary of
inventory consistent with the practice of the Borrower and such
Subsidiaries as of the date hereof;
(ii) sales, leases, transfers and other dispositions of assets no
longer useful in the conduct of its business, or the business of its
Subsidiaries, consistent with its practice on the date hereof, the Fair
Market Value of such assets not to exceed in the aggregate for Borrower
and its Subsidiaries $1,000,000 (or the equivalent in any other
currency);
(iii) the sale of any assets for Fair Market Value for cash to
the extent the Net Cash Proceeds of such sales are used to repay the
outstanding aggregate unpaid principal amount of the Advances Loan as
required under Section 2.06(b).
(l) MAINTENANCE OF OWNERSHIP OF SUBSIDIARIES. Sell or otherwise
dispose of any shares of capital stock of any Subsidiary or any warrants,
rights or options to acquire such capital stock or permit any Subsidiary to
issue, sell or otherwise dispose of any shares of its capital stock or the
capital stock of any other Subsidiary or any warrants, rights or options to
acquire such capital stock except (i) in accordance with Section 5.02(g) and
(ii) to the extent that the Net Cash Proceeds of such sale or disposition are
used to repay the outstanding aggregate unpaid principal amount of the Loan
as required under Section 2.06(b).
(m) TRANSACTIONS WITH AFFILIATES. Enter into any transaction or
agreement with any Affiliate, except any transaction or agreement which is in
the ordinary course of the Borrower's or such Subsidiary's business and which
is upon fair and reasonable terms not less favorable to the Borrower or such
Subsidiary than it would obtain in an arm's-length transaction with a Person
not an Affiliate.
(n) ISSUANCE OF CAPITAL STOCK. Issue any capital stock or any
warrants, rights or options to acquire any such capital stock, except for the
issuance of capital stock by the Borrower pursuant to the Refinancing to the
extent the Net Cash Proceeds of such issuance are used to repay the
outstanding aggregate unpaid principal amount of the Loan as required under
Section 2.06(b).
(o) INVESTMENT COMPANY. Be or become an investment company subject
to the registration requirements under the Investment Company Act of 1940, as
amended.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following events
("EVENTS OF DEFAULT") shall occur and be continuing:
(a) The Borrower, or subject to the Guaranties, the Guarantors,
shall fail to
pay the principal of the Note or interest on the Advances when due or any
Loan Party shall fail to pay any other amount payable under principal
interest other fees any Loan Document within 3 days after the same shall
become due and payable; or
(b) Any representation or warranty made by any Loan Party (or any
of their respective officers) under or in connection any Loan Document shall
prove to have been incorrect in any material respect when made and such
failure shall remain unremedied for 30 days after the earlier of the date on
which (i) an officer of the Borrower becomes aware of such failure or (ii)
written notice thereof shall have been given to the Borrower by the Lender; or
(c) (i) The Borrower shall fail to perform or observe (A) any term,
covenant or agreement contained in Section 2.11, 5.01(a), (b) or (j) or 5.02;
or (B) any other term, covenant or agreement contained in this Agreement or
any other Loan Document to which it is a party (excluding any term, covenant
or agreement covered by Section 6.01(a)), if any such failure shall remain
unremedied for 10 days after written notice thereof shall have been given to
the Borrower by the Lender, or (ii) any other Loan Party shall fail to
perform or observe any term, covenant or agreement contained in any Loan
Document to which it is a party (excluding any term, covenant or agreement
covered by Section 6.01(a)), if any such failure shall remain unremedied for
10 days after written notice thereof shall have been given to the Borrower by
the Lender; or
(d) (i) Any Loan Party or any of its Subsidiaries shall fail to
pay any principal of, premium or interest on, or other amount payable in
respect of, any Debt which is outstanding in a principal amount of at least
$5,000,000 (or the equivalent in any other currency) in the aggregate (but
excluding Debt evidenced by the Note) of such Person when the same becomes
due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Debt; (ii) or any other default or Event of Default (as
defined in such agreement or instrument) shall occur (or any other event or
condition shall exist under applicable law of any relevant jurisdiction,
which shall have an analogous effect under such agreement or instrument)
relating to such Debt; or (iii) any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt and
shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt or
otherwise cause, or permit the holder thereof to cause, such Debt to mature;
or any such Debt shall be declared to be due and payable, or required to be
prepaid or redeemed (other than by a regularly scheduled required prepayment
or redemption), purchased or defeased, or an offer to prepay, redeem,
purchase or defease such Debt shall be required to be made, in each case
prior to the stated maturity thereof; or
(e) Any Loan Party shall generally not pay its debts as such debts
become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors;
or any proceeding shall be instituted by or against any Loan Party or any of
its Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debt under any law relating to
bankruptcy, insolvency or reorganization
or relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it or for
any substantial part of its property; or seeking a warrant of attachment,
execution or similar process against any substantial part of its property
and, in the case of any such proceeding instituted against it (but not
instituted by it), either such proceeding shall remain undismissed or
unstayed for a period of 30 days, or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other
similar official for, or for any substantial part of, its property) shall
occur; or any Loan Party shall take corporate action to authorize any of the
actions set forth above in this subsection (e); or
(f) Any judgment or order for the payment of money in excess of
$5,000,000 (or the equivalent thereof in any other currency) with respect to
any of the Borrower and its Subsidiaries or any other Loan Party, and either
(i) an enforcement proceeding shall have been commenced by any creditor upon
such judgment or order or (ii) there shall have been a period of 10
consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(g) Any non-monetary judgment or order shall be rendered against
any Loan Party or any of its Subsidiaries that could be reasonably likely to
have a Material Adverse Effect, and there shall be any period of 10
consecutive days during which a stay of enforcement or such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(h) Any provision of any Loan Document after delivery thereof shall
for any reason cease to be valid and binding on any Loan Party thereto or
such Loan Party shall so state in writing; provided, however, that such event
could have a Material Adverse Effect; or
(i) Any Loan Party or any of its ERISA Affiliates shall incur, or
in the reasonable discretion of the Lender, shall be reasonably likely to
incur liability as a result of one or more of the following: (i) the
occurrence of any ERISA Event; (ii) the partial or complete withdrawal of
such Loan Party or any of its ERISA Affiliates from a Multiemployer Plan; or
(iii) the reorganization or termination of the Multiemployer Pan, which
liability has or could reasonably be expected to result in a Material Adverse
Effect; or
(j) The Shareholders (other than Vanguard China, Inc.) shall own,
directly or indirectly, less than 75% of the Voting Stock of the Borrower or
shall cease to direct or cause the direction of the management and policies
of the Borrower, whether through Voting Stock, by contract or otherwise; or
(k) There shall occur in the judgment of the Lender any Material
Adverse Change;
then, and in any such event, (i) the Lender may, by notice to the Borrower,
declare its obligation to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) the Lender may by notice to the Borrower,
declare the Note, all interest thereon and all other amounts payable under
this Agreement to be forthwith due and payable, whereupon the Note, all such
interest and all such other amounts shall become and be forthwith due and
payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower; PROVIDED, HOWEVER, that upon an
Event of Default under Section 6.01(e) or (f) with respect to any Loan Party,
(A) the obligation of the Lender to make Advances shall automatically
terminate and (B) the Note, all such interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived
by each Loan Party.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of hereunder or under the Note, nor consent to any departure by any
party hereto therefrom, shall in any event be effective unless the same shall
be in writing and signed by the Lender, and the Lender shall have received
the consent in writing of the Guarantors, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
SECTION 7.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telegraphic, telecopy,
telex or cable communication) and mailed, telegraphed, telecopied, telexed,
cabled or delivered, if to the Borrower, at its address at 12th Floor, Sun
Hung Kai Centre, 30 Harbour Road, Wanchai, Hong Kong, Attention: Xx. Xxxxxx
Xxxx, Telecopier No. (000) 0000-0000; if to the Lender, at its address at 0
Xxxxxxx Xxxxxx #00-00 Xxxxxxxx Xxxxx, Xxxxxxxxx 000000, Attention: Mrs.
Xxxxx Sim, or if to the Guarantors at the addresses set forth in the
respective Guaranties or, as to each party, at such other address as shall be
designated by such party in a written notice to the other party. All such
notices and communications shall, when mailed, telecopied, telegraphed,
telexed or cabled, be effective when deposited in the mails, telecopied,
delivered to the telegraph company, confirmed by telex answerback or
delivered to the cable company, respectively, addressed as aforesaid, except
that notices to the Lender pursuant to the provisions of Article II shall not
be effective until received by the Lender.
SECTION 7.03. NO WAIVER; REMEDIES. No failure on the part of the
Lender to exercise, and no delay in exercising, any right hereunder or under
any Loan Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 7.04. COSTS AND EXPENSES.
(a) The Borrower agrees to pay on demand all reasonable costs and
expenses of the Lender in connection with the preparation, execution,
delivery, administration, modification and amendment of the Loan Documents
and the other documents to be delivered hereunder, including, without
limitation, (A) all due diligence, transportation, computer,
duplication, appraisal, consultant, and audit expenses and (B) the reasonable
fees and expenses of counsel for the Lender with respect thereto and with
respect to advising the Lender as to its rights and responsibilities under
the Loan Documents. The Borrower further agrees to pay on demand all
reasonable costs and expenses of the Lender, if any (including, without
limitation, reasonable counsel fees and expenses), in connection with the
enforcement (whether through negotiations, legal proceedings or otherwise) of
the Loan Documents and the other documents to be delivered hereunder,
including, without limitation, reasonable fees and expenses of counsel for
the Lender in connection with the enforcement of rights under this
Section 7.04(a).
(b) The Borrower agrees to indemnify and hold harmless the Lender
and its Affiliates and their officers, directors, employees, agents and
advisors (each, an "INDEMNIFIED PARTY") from and against any and all claims,
damages, losses, liabilities and expenses (including, without limitation,
reasonable fees and expenses of counsel) that may be incurred by or asserted
or awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in connection
with any investigation, litigation or proceeding or preparation of a defense
in connection therewith) the Note, this Agreement, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the
Advances or, except to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross negligence
or willful misconduct. In the case of an investigation, litigation or other
proceeding to which the indemnity in this Section 7.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by any Loan Party, its directors, shareholders or
creditors or an Indemnified Party or any other Person or any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated.
(c) If any payment of principal of any Advance is made by the
Borrower or any other Loan Party to or for the account of a Lender other than
on the last day of the Interest Period for such Advance, as a result of a
payment, acceleration of the maturity of the Notes pursuant to Section 6.01
or for any other reason, the Borrower shall, upon demand by the Lender, pay
to the Lender for its account any amounts required to compensate the Lender
for any additional losses, costs or expenses that it may reasonably incur as
a result of such payment, including, without limitation, any loss (including
loss of anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by the Lender
to fund or maintain such Advance.
(d) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained
in Sections 2.07, 2.10 and 7.04 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the
Note.
SECTION 7.05. RIGHT OF SET-OFF. Upon the occurrence and during the
continuance of any Event of Default, the Lender or any of its Affiliates is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by the Lender or such Affiliate to or
for the credit or the account of the Borrower against any and all of the
obligations of the Borrower now or hereafter existing under the Loan
Documents, whether or not the Lender shall have made any demand thereunder
and although such obligations may be unmatured. The Lender agrees promptly
to notify the Borrower after any such set-off and application, PROVIDED that
the failure to give such notice shall not affect the validity of such set-off
and application. The rights of the Lender and its Affiliates under this
Section 7.05 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) that the Lender and its Affiliates may
have.
SECTION 7.06. BINDING EFFECT. This Agreement shall become
effective (other than Section 2.01, which shall only become effective upon
satisfaction of the conditions precedent set forth in Section 3.01) when it
shall have been executed by the Borrower and the Lender and thereafter shall
be binding upon and inure to the benefit of the Borrower and the Lender and
their respective successors and assigns, except that no Loan Party shall have
the right to assign or otherwise transfer all or any part of its rights or
obligations hereunder or any interest herein. The Lender may assign or sell
participations in or to all or a portion of its rights and obligations under
the Loan Documents.
SECTION 7.07. GOVERNING LAW. This Agreement and the Note shall be
governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 7.08. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties thereto in
separate counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the same
agreement.
SECTION 7.09. CONSENT TO JURISDICTION.
(a) Each of the parties hereto 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 City, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Agreement or the Note, 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 any such New York State court or, to the extent permitted by
law, in such federal court. Each of the Parties agrees that process served
either personally or by registered mail, return receipt requested, shall, to
the extent permitted by law, constitute adequate service of process in any
such proceeding. Without limiting the foregoing, the parties hereto hereby
appoint, in the case of any such action or proceeding brought in the courts
of or in the State of New York, CT Corporation System, with offices on the
date hereof at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, to receive, for them
and on their behalf, service of process in the State of New York with respect
thereto, PROVIDED that any party hereto may appoint any other person, with
offices in the State of New York to replace such agent for service of process
upon delivery to each other Loan Party notice thereof. 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 shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement
or the Note in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that 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
the Note 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.
SECTION 7.10. JUDGMENT CURRENCY. If any sum due from the Borrower
hereunder, under the Note or any order or judgment given or made in relation
thereto has to be converted from the currency (the "FIRST CURRENCY") in which
the same is payable hereunder, thereunder or under such order or judgment
into another currency (the "SECOND CURRENCY") for the purpose of (a) making
or filing a claim or proof against the Borrower, (b) obtaining an order or
judgment in any court or other tribunal or (c) enforcing any order to
judgment given or made in relation thereto, the Borrower shall indemnify and
hold harmless each of the persons to whom such sum is due from and against
any loss suffered or incurred as a result of any discrepancy between (i) the
rate of exchange used for such purpose to convert the sum in question from
the first currency into the second currency and (ii) the rate or rates of
exchange at which such person may in the ordinary course of business purchase
the first currency with the second currency upon receipt of a sum paid to it
in satisfaction, in whole or in part, of any such order, judgment, claim or
proof.
SECTION 7.11. WAIVER OF JURY TRIAL. EACH OF THE BORROWER AND THE
LENDER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, ANY DOCUMENT
DELIVERED UNDER THE LOAN DOCUMENTS, ANY ADVANCE OR THE ACTIONS OF THE LENDER
IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF OR
THEREOF.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
STAR DIGITEL LIMITED
By
-------------------------------------
Title:
THE TORONTO-DOMINION BANK
By
-------------------------------------
Title:
PROMISSORY NOTE
$8,000,000 Dated: May 16, 1997
FOR VALUE RECEIVED, the undersigned, STAR DIGITEL LIMITED, a
corporation organized under the laws of Hong Kong (the "BORROWER"), HEREBY
PROMISES TO PAY to the order of THE TORONTO-DOMINION BANK (the "LENDER") on
May 16, 1997 (or if the maturity of this Promissory Note is extended to a
later date pursuant to Section 2.04(b) of the Bridge Loan Agreement referred
to below, on such later date) the principal amount of EIGHT MILLION DOLLARS
($8,000,000) or, if less, the aggregate unpaid principal amount of the
Advances (as defined below) made by the Lender to the Borrower pursuant to
the Bridge Loan Agreement (referred to below); capitalized terms that are not
defined herein having the respective meanings specified in the Bridge Loan
Agreement) which is outstanding on May 16, 1997 or such later date, as the
case may be.
The Borrower promises to pay interest on the principal amount of
each Advance from the date of such Advance until such principal amount is
paid in full, at such interest rates, and payable at such times, as are
specified in the Bridge Loan Agreement.
Both principal and interest are payable in the lawful money of the
United States of America to the Lender at Bank of America, New York Branch,
in immediately available funds. Such payments shall be made by wire transfer
to the account of the Lender at Bank of America, New York Branch with its
office at 1 World Trade Center, 00xx Xxxxx, Xxx Xxxx, XX, 00000-0000, XXX,
Account No. 6550 2-97469 CHIPS 361042, or such other account as the Lender
may designate. The Lender is authorized but not required to record the date
and amount of each Advance owing to it and the date and amount of each
principal payment on the schedule annexed hereto and made a part hereof, or
on a continuation thereof which shall be attached hereto and made a part
hereof, and any such recordation shall, in the absence of manifest error,
constitute PRIMA FACIE evidence of the accuracy of the information so
recorded. Prior to any transfer of this Promissory Note, the Lender shall
record the foregoing on such schedule or continuation thereof; PROVIDED,
HOWEVER, that the Lender's so to record shall not limit the obligations of
the Borrower hereunder and under the Bridge Loan Agreement to repay the
actual outstanding principal of and interest on each Advance.
This Promissory Note is the Note referred to in, and is entitled to
the benefits of, (a) the Bridge Loan Agreement dated as of May 16, 1997 (the
"BRIDGE LOAN AGREEMENT") between the Borrower and the Lender, (b) the IWC
Pledge Agreement, (c) the STHL Guaranty, and (d) the VCFC Guaranty. The
Bridge Loan Agreement, among other things, (i) provides for the making of
advances (the "ADVANCES") by the Lender to the Borrower in an aggregate
amount not to exceed at any time outstanding the U.S. Dollar amount first
above mentioned, the
indebtedness of the Borrower resulting from each such Advance being evidenced
by this Promissory Note, and (ii) contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and also for
prepayments on account of principal hereof prior to the maturity hereof upon
the terms and conditions therein specified.
This Promissory Note shall be governed by, and construed in
accordance with, the law of the State of New York.
STAR DIGITEL LIMITED
By:
-----------------------------------
Name:
Title:
LOAN AND PAYMENTS OF PRINCIPAL
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DATE ADVANCE OR PREPAID BALANCE MADE BY
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EXHIBIT B
NOTICE OF BORROWING
[Date]
The Toronto-Dominion Bank
0 Xxxxxxx Xxxxxx
#00-00 Xxxxxxxx Xxxxx
Xxxxxxxxx 000000
Attention: Xxxxx Sim
Ladies and Gentlemen:
The undersigned, STAR DIGITEL LIMITED refers to the Bridge Loan
Agreement, dated as of _______________, 0000 (xxx "XXXXXX LOAN AGREEMENT",
the terms defined therein being used herein as therein defined), among the
undersigned and The Toronto Dominion Bank, and hereby gives you notice,
irrevocably, pursuant to Section 2.02 of the Bridge Loan Agreement that the
undersigned hereby requests a Borrowing under the Bridge Loan Agreement, and
in that connection sets forth below the information relating to Bridge (the
"PROPOSED BORROWING") as required by Section 2.02(a) of the Bridge Loan
Agreement:
(i) The Business Day of the Proposed Borrowing is
_______________, 19__.
(ii) The amount of the Proposed Borrowing is $__________.
(iii) The initial Interest Period for each Advance made as of
part of the Proposed Borrowing is one month.
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed
Borrowing:
(A) the representations and warranties contained in the Bridge Loan
Agreement are correct, before and after giving effect to the Proposed
Borrowing and the application of the proceeds therefrom, as through made
on and as of such date (other than any such representations or
warranties that, by their terms, refer to a specific date other than the
date of the Proposed Borrowing in which case, as of such specific date);
and
(B) no event has occurred and is continuing, or would result from
such Proposed Loan, or the application of proceeds therefrom, which
constitutes a Default.
Very truly yours,
STAR DIGITEL LIMITED
By:
-----------------------------------
Name:
Title:
EXHIBIT C-1
FORM OF GUARANTY FROM STHL
GUARANTY dated May 16, 1997 made by STAR TELECOM HOLDING LIMITED, a
corporation organized under the laws of Hong Kong, (the "Guarantor"), in favor
of the Lender (as defined in the Credit Agreement referred to below).
PRELIMINARY STATEMENT. The Lender is party to the Bridge Loan
Agreement, dated as of May 16, 1997 (said Agreement, as it may hereafter
be amended, supplemented or otherwise modified from time to time, being
the "Credit Agreement") with STAR DIGITEL LIMITED, a corporation
organized under the laws of Hong Kong (the "Borrower"). It is a
condition precedent to the making of Advances under the Credit Agreement
that the Guarantor shall have executed and delivered this Guaranty.
Capitalized terms used but not defined herein shall have the meaning
ascribed to such terms in the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lender to make Advances under the Credit Agreement from time
to time, the Guarantor hereby agrees as follows:
Section 1. GUARANTY. The Guarantor hereby unconditionally and
irrevocably guarantees the punctual payment when due, whether at stated
maturity, by acceleration or otherwise, of (a) Advances under the Credit
Agreement in an aggregate principal amount not to exceed $4,240,000 at
any time outstanding and (b) the product of (x) the STHL Guaranteed
Percentage (as defined below) and (y) the aggregate amount of all
Obligations of the Borrower other than Advances under the Credit
Agreement now or hereafter existing under the other Loan Documents,
whether for interest, fees, expenses or otherwise (the sum of clause (a)
and clause (b) above being the "Guaranteed Obligations"), and in
addition agrees to pay any and all expenses (including reasonable
counsel fees and expenses) incurred by the Lender in enforcing any
rights under this Guaranty. Without limiting the generality of the
foregoing, the Guarantor's liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by the
Borrower to the Lender under the Loan Documents but for the fact that
they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Borrower.
For the purpose of this Guaranty, the "STHL Guaranteed Percentage"
means, at any date of determination, 53%.
Section 2. GUARANTY ABSOLUTE. The Guarantor guarantees the payment
of the Guaranteed Obligations, which will be paid in accordance with the
terms of the Loan Documents, regardless of any law, regulation or order
now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Lender with respect thereto. The Obligations
of the Guarantor under this Guaranty are independent of the Guaranteed
Obligations or any other Obligations of any other Loan Party under the
Loan Documents, and a separate action or actions may be brought and
prosecuted against the Guarantor to enforce this Guaranty, irrespective
of whether any action is brought against the Borrower or any other Loan
Party or
C1-1
whether the Borrower or any other Loan Party is joined in any such
action or actions. The liability of the Guarantor under this Guaranty
shall be irrevocable, absolute and unconditional irrespective of, and
the Guarantor hereby irrevocably waives any defenses it may now or
hereafter have in any way relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Guaranteed Obligations or any
other Obligations of any other Loan Party under the Loan Documents, or
any other amendment or waiver of or any consent to departure from any
Loan Document; PROVIDED, HOWEVER, that any amendment to any Loan
Documents other than the VCFC Guaranty and the IWC Pledge Agreement
shall require the prior written consent of STHL;
(c) any taking, release or amendment or waiver of or consent
to departure from any other guaranty, for all or any of the Guaranteed
Obligations;
(d) any change, restructuring or termination of the corporate
structure or existence of the Borrower or any of its Subsidiaries;
(e) any failure of the Lender to disclose to any Loan Party
any information relating to the financial condition, operations,
properties or prospects of any other Loan Party now or in the future
known to the Lender (the Guarantor waiving any duty on the part of the
Secured Parties to disclose such information); or
(f) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any
representation by the Lender that might otherwise constitute a defense
available to, or a discharge of, any Loan Party or any other guarantor
or surety.
This Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Guaranteed
Obligations is rescinded or must otherwise be returned by the Lender or
any other Person upon the insolvency, bankruptcy or reorganization of
any Loan Party or otherwise, all as though such payment had not been
made.
Section 3. WAIVERS AND ACKNOWLEDGEMENTS. (a) The Guarantor
hereby waives promptness, diligence, notice of acceptance and any other
notice with respect to any of the Guaranteed Obligations and this
Guaranty and any requirement that the Lender protect, secure, perfect or
insure any Lien or any property subject thereto or exhaust any right or
take any action against any Loan Party or any other Person or any
Collateral.
(b) The Guarantor hereby waives any right to revoke this Guaranty,
and acknowledges that this Guaranty is continuing in nature and applies to all
Guaranteed Obligations, whether existing now or in the future.
C1-2
(c) The Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing arrangements
contemplated by the Loan Documents and that the waivers set forth in
this Section 3 are knowingly made in contemplation of such benefits.
Section 4. SUBROGATION. The Guarantor will not exercise any
rights that it may now or hereafter acquire against the Borrower or any
other insider guarantor that arise from the existence, payment,
performance or enforcement of the Guarantor's Obligations under this
Guaranty or any other Loan Document, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution or
indemnification and any right to participate in any claim or remedy of
the Lender against the Borrower or any other insider guarantor or any
Collateral, whether or not such claim, remedy or right arises in equity
or under contract, statute or common law, including, without limitation,
the right to take or receive from the Borrower or any other insider
guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such
claim, remedy or right, unless and until all of the Obligations and all
other amounts payable under this Guaranty shall have been paid in full
in cash and the Commitment shall have expired or terminated. If any
amount shall be paid to the Guarantor in violation of the preceding
sentence at any time prior to the later of the payment in full in cash
of the Guaranteed Obligations and all other amounts payable under this
Guaranty and the Termination Date, such amount shall be held in trust
for the benefit of the Lender and shall forthwith be paid to the Lender
to be credited and applied to the Guaranteed Obligations and all other
amounts payable under this Guaranty, whether matured or unmatured, in
accordance with the terms of the Loan Documents, or to be held as
Collateral for any Guaranteed Obligations or other amounts payable under
this Guaranty thereafter arising. If (i) the Guarantor shall make
payment to the Lender of all or any part of the Guaranteed Obligations,
(ii) all of the Guaranteed Obligations and all other amounts payable
under this Guaranty shall be paid in full in cash and (iii) the
Termination Date shall have occurred, the Lender will, at the
Guarantor's request and expense, execute and deliver to the Guarantor
appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to the
Guarantor of an interest in the Guaranteed Obligations resulting from
such payment by the Guarantor.
Section 5. PAYMENTS FREE AND CLEAR OF TAXES, ETC. (a) Any and
all payments made by the Guarantor hereunder shall be made free and
clear of and without deduction for any and all present or future Taxes.
If the Guarantor shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder to the Lender, (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable
under this Section) the Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Guarantor
shall make such deductions, and (iii) the Guarantor shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) In addition, the Guarantor shall pay any present or
future Other Taxes in respect of all or any part of the Guaranteed
Obligations.
C1-3
(c) The Guarantor will indemnify the Lender for the STHL
Guaranteed Percentage of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section) paid by the Lender and any liability
(including penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto; the Guarantor shall have the right to
contest in good faith such tax levied upon it; provided, however, that
such contest shall in no way limit the Guarantor's Obligations
hereunder. This indemnification shall be made within 30 days from the
date the Lender makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes by
or on behalf of the Guarantor, the Guarantor will furnish to the Lender,
at its address referred to in the Credit Agreement, the original receipt
of payment thereof or a certified copy of such receipt. In the case of
any payment hereunder by or on behalf of the Guarantor through an
account or branch outside the United States or on behalf of the
Guarantor by a payor that is not a United States person, if the
Guarantor determines that no Taxes are payable in respect thereof, the
Guarantor shall, at the request of the Lender, furnish, or shall cause
such payor to furnish, to the Lender, at such address, an opinion of
counsel acceptable to the Lender stating that such payment is exempt
from Taxes. For purposes of this subsection (d), the terms "United
States" and "United States person" shall have the meanings specified in
Section 7701 of the Internal Revenue Code.
(e) Without prejudice to the survival of any other agreement
of the Guarantor hereunder or under any other Loan Document, the
agreements and obligations of the Guarantor contained in this Section 5
shall survive the payment in full of the Guaranteed Obligations and all
other amounts payable under this Guaranty.
Section 6. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby
represents and warrants as follows:
(a) DUE INCORPORATION, ETC. The Guarantor (i) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its organization, (ii) is duly authorized to do business in each jurisdiction
in which such authorization is required by law or in which the failure to be
so authorized would not have material adverse effect on (x) the business,
condition (financial or otherwise), operation, performance or properties of
the Guarantor and its subsidiaries, taken as a whole, (y) the rights and
remedies of the Lender under this Guaranty, or (z) the ability of the
Guarantor to perform its obligations under this Guaranty (each, a "Material
Adverse Effect"), and (iii) has all requisite power and authority (A) to own
or hold under lease and to operate all of its property and assets and (B) to
execute, deliver and perform all its obligations under each Loan Document to
which it is or will be a party.
(b) CORPORATE POWER, ETC. The Guarantor has full corporate
power and authority to enter into, deliver and perform its obligations
under each Loan Document to which it is a party and to consummate each
of the transactions contemplated hereby and thereby, and has taken all
necessary corporate action to authorize the execution, delivery and
performance by it of each Loan Document to which it is a party. Each
Loan Document to which the Guarantor is a party constitutes the legal,
valid and binding obligation of the Guarantor, enforceable against the
C1-4
Guarantor in accordance with its terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws now or hereafter in effect affecting the enforcement of creditors'
rights generally and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law).
(c) NO CONFLICT. Neither the execution and delivery of each
Loan Document to which it is or will be a party nor the performance by
the Guarantor of its obligations thereunder, nor the consummation of the
transactions contemplated thereby, will (i) conflict with the
Certificate of Incorporation or by-laws of the Guarantor, or (ii)
conflict with or result in a breach of, or constitute a default under,
or result in the creation or imposition of any Lien upon any property or
assets of the Guarantor under, any applicable laws (including, without
limitation, Regulation X issued by the Board of Governors of the Federal
Reserve System) or any indenture, mortgage, deed of trust or other
instrument or agreement to which the Guarantor may be or become a party
or by which it may be or become bound or to which any of the property or
assets of the Guarantor may be subject.
(d) APPROVALS. ETC. No order, license, consent,
authorization or approval of, or exemption by, or notice to or
registration with, any governmental authority or regulatory body, and no
filing, recording, publication or registration in any public office or
any other place (other than, in each case, such filings as may be
required under applicable securities laws), is required in connection
with the execution, delivery and performance by the Guarantor of any
Loan Document to which it is or will be a party, or for the legality,
validity, binding effect or enforceability thereof.
(e) FINANCIAL STATEMENTS. The Consolidated balance sheets of
STIHL as at December 31, 1996, and the related Consolidated statements
of income and cash flows of STIHL for the fiscal year then ended,
accompanied by an opinion of the independent chartered or public
accountants of STIHL, copies of which have been furnished to the Lender,
fairly present the Consolidated financial condition of STIHL and its
Subsidiaries as at such date and the results of the operations thereof
for the period ended on such date. All such financial statements,
including the related schedules and notes thereto, have been prepared in
accordance with U.S. GAAP for STIHL applied consistently throughout the
periods involved.
(f) NO MATERIAL ADVERSE EFFECT. Since December 31, 1996,
there has been no, nor, to the best of the Guarantor's knowledge, has
there been any event which could reasonably be elected to have a,
Material Adverse Effect.
(g) LITIGATION, ETC. There is no pending or, to the best of
the Guarantor's knowledge, threatened litigation, investigation, action
or proceeding of or before any court, arbitrator or governmental agency
(including any Environmental Action) binding upon or affecting any of
the Guarantor or its Subsidiaries or their respective properties and
assets that (i) could reasonably be expected to cause a Material Adverse
Effect to occur or (ii) purports to affect the legality, validity or
enforceability of any Loan Document to which the Guarantor is a party.
C1-5
(h) NO VIOLATION, ETC. The Guarantor is not in violation of,
nor does the execution by the Guarantor of the Loan Documents to which
it is a party or the consummation of the transactions contemplated
thereby result in the violation of, (i) any term of its charter or
by-laws, (ii) the Shareholders Agreement, or (ii) any term of any other
agreement or instrument to which it is a party or by which it is bound
in any respect, which, in each case, has or could be reasonably expected
to have a Material Adverse Effect.
(i) MARGIN STOCK. The Guarantor is not engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock within
the meaning of Regulations G, T and X issued by the Board of Governors of the
Federal Reserve System.
(j) INVESTMENT COMPANY ACT AND PUBLIC UTILITY HOLDING COMPANY
ACT. The Guarantor is not, and is not directly or indirectly controlled
by any Person which is, required to register as an "investment company"
within the meaning of the U.S. Investment Company Act of 1940, as
amended. The Guarantor is not a "holding company" or a "subsidiary" or
an "affiliate" of a "holding company" or a "public utility" within the
meaning of the U.S. Public Utility Holding Company Act of 1935, as
amended.
(k) TAXES. The Guarantor has filed all tax returns required
to be filed by it and has paid all taxes, assessments, fees and other
charges (including interest and penalties) due with respect to the years
covered by such returns, except for any such failures to file or to pay
such amounts which, in the aggregate, would not have a Material Adverse
Effect or which are being contested in good faith by appropriate
proceedings.
(l) ENVIRONMENTAL LAWS. The operations and properties of the
Guarantor comply in all material respects with all applicable Environmental
Laws, except where the failure to so comply could not be reasonably expected to
have a Material Adverse Effect, and all necessary Environmental Permits have
been obtained and are in effect for the operations and properties of the
Guarantor and its Subsidiaries, EXCEPT for such Environmental Permits where the
failure to obtain the came, in the aggregate, could not be reasonably expected
to have a Material Adverse Effect.
(m) CONDITIONS PRECEDENT. Upon execution hereof and the
other Loan Documents by all parties, there are no conditions precedent
to the effectiveness of this Guaranty that have not been satisfied or
waived.
(n) CREDIT ANALYSIS; OTHER INFORMATION. The Guarantor has,
independently and without reliance upon the Lender and based on such
documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Guaranty, and the
Guarantor has established adequate means of obtaining from the Borrower
on a continuing basis information pertaining to, and is now and on a
continuing basis will be completely familiar with, the financial
condition, operations, properties and prospects of the Borrower.
C1-6
Section 7. AFFIRMATIVE COVENANTS. The Guarantor covenants and agrees
that, so long as any part of the Guaranteed Obligations shall remain unpaid
or the Lender shall have any Commitment, the Guarantor will, unless the
Leader shall otherwise consent in writing:
(a) CORPORATE EXISTENCE. Preserve and maintain in full force
and effect its corporate existence, rights (charter and statutory),
franchises and privileges and qualify and remain qualified, as a
corporation in good standing in each jurisdiction in which such
qualification is from time to time necessary, except for such
jurisdictions where the failure to so qualify would not have a Material
Adverse Effect; PROVIDED, HOWEVER, that the Guarantor shall not be
required to preserve any right, privilege or franchise if the board of
directors thereof shall determine in good faith that such right,
privilege or franchise is no longer useful in the conduct of the
business of the Guarantor, and the loss thereof is not disadvantageous
in any material respect to the Lender.
(b) COMPLIANCE WITH LAWS. Comply in an material respects
with all applicable laws, rules, regulations and orders, such compliance
to include, without limitation, compliance with ERISA, except where the
failure to so comply would not have a Material Adverse Effect.
(c) INSURANCE. Maintain insurance with financially sound and
reputable insurers in such amounts and against such risks, as are
usually and customarily insured by companies engaged in a similar
business with respect to properties of a similar character.
(d) KEEPING OF BOOKS. Keep proper books of record and
accounts, in which full and correct entries shall be made of all
financial transactions and the assets and business of the Guarantor in
accordance with generally accepted accounting principles in effect from
time to time or as otherwise required by applicable rules and
regulations of any governmental agency or regulatory authority having
jurisdiction over the Guarantor.
(e) ACCESS TO RECORDS. Provide the Lender and its authorized
advisors and representatives reasonable access to all books, records,
offices and other facilities and properties of the Guarantor upon
reasonable notice, and allow the Lender or its authorized advisors or
representatives (as the case may be) to make such examinations thereof
and copies of and abstracts from such books and records as the Lender or
its authorized advisors or representatives (as the case may be) may
reasonably request.
(f) PAYMENT OF TAXES, ETC. Pay and discharge before the same
shall become delinquent (i) all taxes, assessments and governmental
charges or levies imposed upon it or upon its property and (ii) all
lawful claims that, if unpaid, might become a lien upon its property;
PROVIDED, HOWEVER, that Guarantor shall not be required to pay or
discharge any such tax, assessment, charge or claim that is being
contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained, unless and until any Lien
resulting therefrom attaches to its property and becomes enforceable
against its other creditors.
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(g) REPORTING. Furnish to the Lender at the request of the
Lender, without cost to the Lender, copies of all documents and
certificates delivered to any holder of Debt of the Guarantor promptly
after delivery thereof to such Lender or holder of Debt.
(h) NOTICE OF DEFAULTS. Promptly upon any officer of the
Guarantor obtaining knowledge thereof, give notice to the Lender, (i) of
any development, including, without limitation, any litigation,
investigation or proceeding affecting the Guarantor, which has a
Material Adverse Effect, could reasonably be expected to have a Material
Adverse Effect or, in the case of any litigation, investigation or other
proceeding, which could, if adversely decided, reasonably be expected to
have a Material Adverse Effect.
(i) COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply with all
Environmental Laws and Environmental Permits applicable to its
operations and properties, noncompliance with which could have a
Material Adverse Effect; obtain and renew all Environmental Permits
necessary for its operations and properties; and conduct any
investigation, study, sampling and testing, and undertake any cleanup,
removal, remedial or other action necessary to remove and clean up
Hazardous Materials from any of its properties, in accordance with the
requirements of all applicable Environmental Laws; PROVIDED, HOWEVER,
that the Guarantor shall not be required to undertake any such cleanup,
removal, remedial or other action to the extent that its obligation to
do so is being contested in good faith and by proper proceedings and
appropriate reserves are being maintained with respect to such
circumstances.
(j) PARI PASSU. Ensure that the Guaranteed Obligations shall
rank PARI PASSU with all present and future senior secured and unsecured
Obligations of the Guarantor.
(k) REFINANCING. Use its best efforts to cause the Borrower
to complete the Refinancing prior to the Final Maturity Date, which
Refinancing shall yield an amount sufficient to repay the aggregate
unpaid principal amount of the Advances in full PLUS accrued interest
thereon to the date of repayment and all other amounts payable under the
Loan Documents.
Section 8. NEGATIVE COVENANT. The Guarantor covenants and agrees that,
so long as any part of the Guaranteed Obligations shall remain unpaid, or the
Lender shall have any Commitment, the Guarantor will not, without the prior
written consent of the Lender:
(a) MERGERS, ETC. Merge into or consolidate with any Person,
except after giving effect any such merger or consolidation, the
corporation formed by such merger or consideration shall assume the
Guarantor's obligations and the performance of the Guarantor's covenants
under this Guaranty in a writing reasonably satisfactory in form and
substance to the Lender.
(b) OPERATE OTHER THAN IN ORDINARY COURSE. Operate its
business, other than in the usual and ordinary course and other than
that which is consistent with the past practice established by the
Guarantor.
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(c) NEGATIVE PLEDGE. Enter into or suffer to exist any agreement
prohibiting or conditioning the creation or assumption of any Lien upon any of
its property or assets (including, without limitation, any Shares) other than
(i) in favor of the Lender or (ii) in respect of any Debt of the Guarantor
outstanding as of the date hereof.
(d) AMENDMENTS OR WAIVERS. Amend, modify or change in any manner or
waive any of its rights pursuant to the charter or by-laws (or other
organizational documents) of the Guarantor, which, in the reasonable judgment of
the Lender, would adversely affect the Lender's rights and benefits under the
Loan Documents and the documents delivered pursuant thereto.
(e) INVESTMENT COMPANY. Be or become an investment company subject
to the registration requirements under the Investment Company Act of 1940, as
amended.
(f) MAINTENANCE OF OWNERSHIP OF THE BORROWER. Dispose of any
shares of capital stock of the Borrower or any warrants, rights or
options to acquire such capital stock, if, as a result of such disposal,
STHL and IWC shall in the aggregate retain possession of, or the right,
directly or indirectly, to vote less than 75% of the Shares or the
ability to direct or to cause the direction of the management and
policies of the Borrower, whether through the ownership of Shares, by
contract or otherwise.
Section 9. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Guaranty and no consent to any departure by the
Guarantor therefrom shall in any event be effective unless the same
shall be in writing and signed by the Lender, and then such waiver or
consent shall be effective only in the specific instance and for the
specific purpose for which given.
Section 10. NOTICE, ETC. All notices and other communications
provided for hereunder shall be in writing (including telegraphic,
telecopy or telex communication) and mailed, telegraphed, telecopied,
telexed or delivered to it, at its address at 6th Floor, Star Telecom
Tower, 414 Xxxx Xxxx Road, Kowloon, Hong Kong Attention: Xx. Xxxx Xxx Xx
(Fax No. 000-0000-0000). All such notices and other communications
shall, when mailed, telegraphed, telecopied or telexed, be effective
when deposited in the mails, delivered to the telegraph company,
transmitted by telecopier or confirmed by telex answerback, respectively.
Section 11. NO WAIVER; REMEDIES. No failure on the part of the
Lender to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided
are cumulative and not exclusive of any remedies provided by law.
Section 12. RIGHT OF SET-OFF. Upon (a) the occurrence and during
the continuance of any Event of Default and (b) the making of the
request or the granting of the consent specified by Section 6.01 of the
Credit Agreement to authorize the Lender to declare the Note due and
payable pursuant to the provisions of said Section 6.01, the Lender and
any of its Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set
C1-9
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any
time owing by the Lender or such Affiliate to or for the credit or the
account of the Guarantor against any and all of the Obligations of the
Guarantor now or hereafter existing under this Guaranty, whether or not
the Lender or such Affiliate shall have made any demand under this
Guaranty and although such Obligations may be unmatured. The Lender
agrees promptly to notify the Guarantor after any such set-off and
application; PROVIDED, HOWEVER, that the failure to give such notice
shall not affect the validity of such set-off and application. The
rights of the Lender and its Affiliates under this Section are in
addition to other rights and remedies (including, without limitation,
other rights of set-off) that the Lender may have.
Section 13. INDEMNIFICATION. Without limitation on any other
Obligations of the Guarantor or remedies of the Lender under this
Guaranty, the Guarantor shall, to the fullest extent permitted by law,
indemnify, defend and save and hold harmless the Lender from and
against, and shall pay on demand, any and all losses, liabilities,
damages, costs, expenses and charges (including the reasonable fees and
disbursements of the Lender's legal counsel) suffered or incurred by the
Lender as a result of any failure of any Guaranteed Obligations to be
the legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their terms.
Section 14. CONTINUING GUARANTY; ASSIGNMENTS UNDER THE CREDIT
AGREEMENT. This Guaranty is a continuing guaranty and shall (a) remain
in full force and effect until the later of the payment in full in cash
of the Guaranty Obligations and an other amounts payable under this
Guaranty and the Termination Date, (b) be binding upon the Guarantor,
its successors and assigns and (c) inure to the benefit of and be
enforceable by the Lender and their successors, transferees and assigns.
Without limiting the generality of the foregoing clause (c), the Lender
may assign or otherwise transfer all or any portion of its rights and
obligations under the Credit Agreement (including, without limitation,
all or any portion of the Commitment, the Advances owing to it and the
Note held by it) to any other Person, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted
to the Lender herein or otherwise, in each case as and to the extent
provided under the Credit Agreement.
Section 15. GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL,
ETC. (a) This Guaranty shall be governed by, and construed in
accordance with, the laws of the State of New York.
(b) The Guarantor 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 City, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Guaranty, or for recognition or enforcement of any judgment, and the
Guarantor hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined
in any such New York State court or, to the extent permitted by law, in
such federal court. The Guarantor agrees that process served either
personally or by registered mail, return receipt requested, shall, to
the extent permitted by law, constitute adequate service of process in
any
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such proceeding. Without limiting the foregoing, the Guarantor hereby
appoints, in the case of any such action or proceeding brought in the
courts of or in the State of New York, CT Corporation System, with
offices on the date hereof at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
to receive, for them and on their behalf, service of process in the
State of New York with respect thereto, PROVIDED that the Guarantor may
appoint any other person, with offices in the State of New York to
replace such agent for service of process upon delivery to each other
Loan Party notice thereof. The Guarantor 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 Guaranty shall affect any right that
any Loan Party may otherwise have to bring any action or proceeding
relating to this Guaranty in the courts of any jurisdiction.
(c) The Guarantor hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this
Guaranty in any New York State or federal court. The Guarantor 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.
(d) If any sum due from the Guarantor under this Guaranty or
any order or judgment given or made in relation thereto has to be
converted from the currency (the "first currency") in which the same is
payable hereunder or under such order or judgment into another currency
(the "second currency") for the purpose of (a) making or filing a claim
or proof against the Guarantor, (b) obtaining an order or judgment in
any court or other tribunal or (c) enforcing any order to judgment given
or made in relation thereto, the Guarantor shall indemnify and hold
harmless each of the persons to whom such sum is due from and against
any loss suffered or incurred as a result of any discrepancy between (i)
the rate of exchange used for such purpose to convert the sum in
question from the first currency into the second currency and (ii) the
rate or rates of exchange at which such person may in the ordinary
course of business purchase the first currency with the second currency
upon receipt of a sum paid to it in satisfaction, in whole or in part,
of any such order, judgment, claim or proof.
(e) The Guarantor hereby waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort
or otherwise) arising out of or relating to this Guaranty, any document
delivered under this Guaranty, any Advance or the actions of the Lender
in the negotiations, administration, performance or enforcement hereof.
C1-11
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be
duly executed and delivered by its officer thereunto duly authorized as
of the date first above written.
STAR TELECOM HOLDING LIMITED
By:
------------------------------------
Name:
Title:
X0-00
XXXXXXX X-0
XXXX XX XXXXXXXX FROM VCFC
GUARANTY dated May 16, 1997 made by VANGUARD CELLULAR FINANCIAL
CORP., a North Carolina corporation (the "Guarantor"), in favor of the
Lender (as defined in the Credit Agreement referred to below).
PRELIMINARY STATEMENT. The Lender is party to the Bridge Loan
Agreement, dated as of May 16, 1997 (said Agreement, as it may hereafter
be amended, supplemented or otherwise modified from time to time, being
the "Credit Agreement") with STAR DIGITEL LIMITED, a corporation
organized under the laws of Hong Kong (the "Borrower"). It is a
condition precedent to the making of Advances under the Credit Agreement
that the Guarantor shall have executed and delivered this Guaranty.
Capitalized terms used but not defined herein shall have the meaning
ascribed to such terms in the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lender to make Advances under the Credit Agreement from time
to time, the Guarantor hereby agrees as follows:
Section 1. GUARANTY. (a) The Guarantor hereby unconditionally and
irrevocably guarantees the punctual payment when due, whether at stated
maturity, by acceleration or otherwise, of the sum of (i) Advances under
the Credit Agreement in an aggregate principal amount not to exceed
$3,760,000 and (ii) the product of (x) the VCFC Guarantee Percentage (as
defined below) and (y) the aggregate amount of all Obligations of the
Borrower other than Advances under the Credit Agreement now or hereafter
existing under the other Loan Documents, whether for interest, few,
expenses or otherwise (the sum of clauses (i) and (ii) being the
"Guaranteed Obligation"), and in addition agrees to pay any and all
expenses (including reasonable counsel fees and expenses) incurred by
the Lender in enforcing any rights under this Guaranty. Without
limiting the generality of the foregoing, the Guarantor's liability
shall extend to all amounts that constitute part of the Guaranteed
Obligations and would be owed by the Borrower to the Lender under the
Loan Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or
similar proceeding involving the Borrower. The "VCFC Guaranteed
Percentage" means, at any date of determination, 47%.
(b) The liability of the Guarantor under this Guaranty shall
not exceed the greater of (i) the net benefit realized by the Guarantor
from the proceeds of the Advances made from time to time by the Borrower
to the Guarantor or any Subsidiary of the Guarantor and (ii) the greater
of (x) 95% of the Adjusted Net Assets of the Guarantor on the date of
delivery hereof and (y) 95% of the Adjusted Net Assets of the Guarantor
on the date of any payment hereunder. "Adjusted Net Assets" of the
Guarantor at any date means the lesser of (x) the amount by which the
fair value of the property of the Guarantor exceeds the total amount of
liabilities, including, without limitation, contingent liabilities, but
excluding liabilities under this Guaranty),
C2-1
of the Guarantor at such date and (y) the amount by which the present
fair salable value of the assets of the Guarantor at such date exceeds
the amount that will be required to pay the probable liability of the
Guarantor on its debts, excluding debt in respect of this Guaranty, as
they become absolute and matured.
Section 2. GUARANTY ABSOLUTE. The Guarantor guarantees the
payment of Guaranteed Obligations, which will be paid in accordance with
the terms of the Loan Documents, regardless of any law, regulation or
order now or hereafter in effect in any jurisdiction affecting any of
such terms or the rights of the Lender with respect thereto. The
Obligations of the Guarantor under this Guaranty are independent of any
Obligations of any other Loan Party under the Loan Document, and a
separate action or actions may be brought and prosecuted against the
Guarantor to enforce this Guaranty, irrespective of whether any action
is brought against the Borrower or any other Loan Party or whether the
Borrower or any other Loan Party is joined in any such action or
actions. The liability of the Guarantor under this Guaranty shall be
irrevocable, absolute and unconditional irrespective of, and the
Guarantor hereby irrevocably waives any defenses it may now or hereafter
have in any way relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument redating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Guaranteed Obligations or any
other Obligations of any other Loan Party under the Loan Documents, or
any other amendment or waiver of or any consent to departure from any
Loan Document; PROVIDED, HOWEVER, that any amendment to or other
modification of the Loan Documents (other than the STHL Guaranty and the
IWC Pledge Agreement) shall require the prior written consent of VCFC;
(c) any taking, release or amendment or waiver of or consent
to departure from any other guaranty, for all or any of the Guaranteed
Obligations;
(d) any change, restructuring or termination of the corporate
structure or existence of the Borrower or any of its Subsidiaries;
(e) any failure of the Lender to disclose to any Loan Party
any information relating to the financial condition, operations,
properties or prospects of any other Loan Party now or in the future
known to the Lender (the Guarantor waiving any duty on the part of the
Secured Parties to disclose such information); or
(f) any other circumstance (including, without limitation,
any statute of limitations) or any existence of or reliance on any
representation by the Lender that might otherwise constitute a defense
available to, or a discharge of, any Loan Party or any other guarantor
or surety.
This Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Guaranteed
Obligations is rescinded or must otherwise be returned by
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the Lender or any other Person upon the insolvency, bankruptcy or
reorganization of any Loan Party or otherwise, all as though such
payment had not been made.
Section 3. WAIVERS AND ACKNOWLEDGMENTS. (a) The Guarantor hereby
waives promptness, diligence, notice of acceptance and any other notice
with respect to any of the Guaranteed Obligations and this Guaranty and
any requirement that the Lender protect, secure, perfect or insure any
Lien or any property subject thereto or exhaust any right or take any
action against any Loan Party or any other Person or any Collateral.
(b) The Guarantor hereby waives any right to revoke this
Guaranty, and acknowledges that this Guaranty is continuing in nature
and applies to all Guaranteed Obligations, whether existing now or in
the future.
(c) The Guarantor acknowledges that it will receive substantial
direct and indirect benefits from the financing arrangements contemplated by the
Loan Documents and that the waivers set forth in this Section 3 are knowingly
made in contemplation of such benefits.
Section 4. SUBROGATION. The Guarantor will not exercise any
rights that it may now or hereafter acquire against the Borrower or any
other insider guarantor that arise from the existence, payment,
performance or enforcement of the Guarantor's Obligations under this
Guaranty or any other Loan Document, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution or
indemnification and any right to participate in any claim or remedy of
the Lender against the Borrower or any other insider guarantor or any
Collateral, whether or not such claim, remedy or right arises in equity
or under contract, statute or common law, including, without limitation,
the right to take or receive from the Borrower or any other insider
guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such
claim, remedy or right, unless and until all of the Obligations and all
other amounts payable under this Guaranty shall have been paid in full
in cash and the Commitment shall have expired or terminated. If any
amount shall be paid to the Guarantor in violation of the preceding
sentence at any time prior to the later of the payment in full in cash
of the Guaranteed Obligations and all other amounts payable under this
Guaranty and the Termination Date, such amount shall held in trust for
the benefit of the Lender and shall forthwith be paid to the Lender to
be credited and applied to the Guaranteed Obligations and all other
amounts payable under this Gnaranq, whether matured or unmatured, in
accordance with the terms of the Loan Documents, or to be held as
Collateral for any Guaranteed Obligations or other amounts payable under
this Guaranty thereafter arising. If (i) the Guarantor shall make
payment to the Lender of all or any part of the Guaranteed Obligations,
(ii) all of the Guaranteed Obligations and all other amounts payable
under this Guaranty shall be paid in full in cash and (iii) the
Termination Date shall have occurred, the Lender will, at the
Guarantor's request and expense, execute and deliver to the Guarantor
appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to the
Guarantor of an interest in the Guaranteed Obligations resulting from
such payment by the Guarantor.
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Section 5. PAYMENTS FREE AND CLEAR OF TAXES, ETC. (a) Any and all
payments made by the Guarantor hereunder shall be made free and clear of
and without deduction for any and all present or future Taxes. If the
Guarantor shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder to the Lender, (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable
under this Section) the Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Guarantor
shall make such deductions and (iii) the Guarantor shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) In addition, the Guarantor agrees to pay any present or
future Other Taxes in respect of all or any part of the Guaranteed
Obligations.
(c) The Guarantor will indemnify the Lender for the VCFC
Guaranteed Percentage of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section) paid by the Lender and any liability
(including penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto; the Guarantor shall have the right to
contest in good faith such tax levied upon it; provided, however, that
such contest shall in no way limit the Guarantor's Obligations
hereunder. This indemnification shall be made within 30 days from the
date the Lender makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes by
or on behalf of the Guarantor, the Guarantor will furnish to the Lender,
at its address referred to in the Credit Agreement, the original receipt
of payment thereof or a certified copy of such receipt or to the extent
that a receipt is not given, other reasonable evidence of payment
thereof. In the case of any payment hereunder by or on behalf of the
Guarantor through an account or branch outside the United States or on
behalf of the Guarantor by a payer that is not a United States person,
if the Guarantor determines that no Taxes are payable in respect
thereof, the Guarantor shall, at the request of the Lender, furnish, or
shall cause such payor to furnish, to the Lender, at such address, an
opinion of counsel acceptable to the Lender stating that such payment is
exempt from Taxes. For purposes of this subsection (d), the terms
"United States" and "United States person" shall have the meanings
specified in Section 7701 of the Internal Revenue Code.
(e) Without prejudice to the survival of any other agreement
of the Guarantor hereunder or under any other Loan Document, the
agreements and obligations of the Guarantor contained in this Section 5
shall survive the payment in full of the Guaranteed Obligations and all
other amounts payable under this Guaranty.
Section 6. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby
represents and warrants as follows:
(a) DUE INCORPORATION, ETC. The Guarantor (i) is duly organized,
valid existing and in good standing under the laws of the jurisdiction of its
organization, (ii) is duly authorized to do business in each jurisdiction in
which such authorization is required by law or in which the failure to be so
authorized would not have material adverse effect on (x) the business,
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condition (financial or otherwise), operation or properties of the
Guarantor and its subsidiaries taken as a whole, (y) the rights and
remedies of the Lender under this Guaranty, or (z) the ability of the
Guarantor to perform its obligations under this Guaranty (each, a
"Guarantor Material Adverse Effect"), and (iii) has all requisite power
and authority (A) to own or hold under lease and to operate all of its
property and assets and (B) to execute, deliver and perform all its
obligations under each Loan Document to which it is or will be a party.
(b) CORPORATE POWER, ETC. The Guarantor has full corporate
power and authority to enter into, deliver and perform its obligations
under each Loan Document to which it is a party and to consummate each
of the transactions contemplated hereby and thereby, and has taken all
necessary corporate action to authorize the execution, delivery and
performance by it of each Loan Document to which it is a party. Each
Loan Document to which the Guarantor is a party constitutes the legal,
valid and binding obligation of the Guarantor, enforceable against the
Guarantor in accordance with its terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws now or hereafter in effect affecting the enforcement of creditors'
rights generally and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law).
(c) NO CONFLICT. Neither the execution and delivery of each
Loan Document to which it is or will be a party nor the performance by
the Guarantor of its obligations thereunder, nor the consummation of the
transactions contemplated thereby, will (i) conflict with the Articles
of Incorporation or bylaws of the Guarantor, or (ii) conflict with or
result in a breach of, or constitute a default under, or result in the
creation or imposition of any Lien upon any of the property or assets of
the Guarantor under, any applicable laws (including, without limitation,
Regulation X issued by the Board of Governors of the Federal Reserve
System) or any indenture, mortgage, deed of trust or other instrument or
agreement to which the Guarantor may be or become a party or by which it
may be or become bound or to which any of the property or assets of the
Guarantor may be subject.
(d) APPROVALS, ETC. No order, license, consent,
authorization or approval of, or exemption by, or notice to or
registration with, any governmental authority or regulatory body, and no
filing, recording, publication or registration in any public office or
any other place (other than, in each case, such filings as may be
required under applicable securities laws), is required in connection
with the execution, delivery and performance by the Guarantor of any
Loan Document to which it is a party, or for the legality, validity,
binding effect or enforceability thereof.
(e) FINANCIAL STATEMENTS. The Consolidated balance sheets of
Vanguard Cellular Systems, Inc., a North Carolina corporation
("Vanguard"), and Subsidiaries as of December 31, 1996, and the related
Consolidated statements of income and cash flows of Vanguard for the
fiscal year then ended, accompanied by an opinion of the independent
chartered or public accountants of Vanguard, copies of which have been
furnished to the Lender, fairly present the Consolidated financial
condition of Vanguard and Subsidiaries as of such date and the results
of the operations thereof for the period ended on such date. All such
financial
C2-5
statements, including the related schedules and notes thereto, have been
prepared in accordance with U.S. GAAP for Vanguard applied consistently
throughout the periods involved.
(f) NO GUARANTOR MATERIAL ADVERSE EFFECT. Since December 31, 1996,
there has been no, nor, to the best of the Guarantor's knowledge, has there been
any event that could reasonably be elected to have a, Guarantor Material Adverse
Effect.
(g) LITIGATION, ETC. There is no pending or, to the best of the
Guarantor's knowledge, threatened litigation, investigation, action or
proceeding of or before any court, arbitrator or governmental agency (including
any Environmental Action) binding upon or affecting any of the Guarantor or its
Subsidiaries or their respective properties and assets that (i) could reasonably
be expected to cause a Guarantor Material Adverse Effect to occur or
(ii) purports to affect the legality, validity or enforceability of any Loan
Document to which the Guarantor is a party.
(h) NO VIOLATION, ETC. The Guarantor is not in violation of, nor
does the execution by the Guarantor of the Loan Documents to which it is a party
or the consummation of the transactions contemplated thereby result in the
violation of, (i) any term of its charter or bylaws, (ii) the Shareholders
Agreement, or (iii) any term of any other agreement or instrument to which it is
a party or by which it is bound in any respect, which, in each case, has or
could be reasonably expected to have a Guarantor Material Adverse Effect.
(i) MARGIN STOCKS. The Guarantor is not engaged in the
business of extending credit for the purpose of purchasing or carrying
margin stock within the meaning of Regulations G, T and X issued by the
Board of Governors of the Federal Reserve System.
(j) INVESTMENT COMPANY ACT AND PUBLIC UTILITY HOLDING COMPANY ACT.
The Guarantor is not, and is not directly or indirectly controlled by any
Person which is, required to register as an "investment company" in the
meaning of the U.S. Investment Company Act of 1940, as amended. The
Guarantor is not a "holding company" or a "subsidiary" or an "affiliate" of a
"holding company" or a "public utility" within the meaning of the U.S. Public
Utility Holding Company Act of 1935, as amended.
(k) TAXES. The Guarantor has filed all tax returns required
to be filed by it and has paid all taxes, assessments, fees and other
charges (including interest and penalties) due with respect to the years
covered by such returns, except for any such failures to file or to pay
such amounts which, in the aggregate, would not have a Guarantor
Material Adverse Effect or which are being contested in good faith by
appropriate proceedings.
(l) ENVIRONMENTAL LAWS. The operations and properties of the
Guarantor comply in all material respects with all applicable
Environmental Laws, except where the failure to so comply could not be
reasonably expected to have a Guarantor Material Adverse Effect, and all
necessary Environmental Permits have been obtained and are in effect for
the operations and properties of the Guarantor and its Subsidiaries,
EXCEPT for such Environmental Permits where the failure to obtain the
same, in the aggregate, could not be reasonably expected to have a
Guarantor Material Adverse Effect.
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(m) CONDITIONS PRECEDENT. Upon execution hereof and the other Loan
Documents by all of the parties thereto, there are no conditions precedent to
the effectiveness of this Guaranty that have not been satisfied or waived.
(n) CREDIT ANALYSIS; OTHER INFORMATION. The Guarantor has,
independently and without radiance upon the Lender and based on such
documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Guaranty, and the
Guarantor has established adequate means of obtaining from the Borrower
on a continuing basis information pertaining to, and is now and on a
continuing basis will be completely familiar with, the financial
condition, operations, properties and prospects of the Borrower.
Section 7. AFFIRMATIVE COVENANTS. The Guarantor covenants and
agrees that, so long as any part of the Guaranteed Obligations shall
remain unpaid or the Lender shall have any Commitment, the Guarantor
will, unless the Lender shall otherwise consent in writing:
(a) CORPORATE EXISTENCE. Preserve and maintain in full force
and effect its corporate existence, rights (charter and statutory),
franchises and privileges and qualify and remain qualified, as a
corporation in good standing in each jurisdiction in which such
qualification is from time to time necessary, except for such
jurisdictions where the failure to so qualify would not have a Guarantor
Material Adverse Effect; PROVIDED, HOWEVER, that the Guarantor shall not
be required to preserve any right, privilege or franchise if the board
of directors thereof shall determine in good faith that such right,
privilege or franchise is no longer useful in the conduct of the
business of the Guarantor, and the loss thereof is not disadvantageous
in any material respect to the Lender.
(b) COMPLIANCE WITH LAWS. Comply in an material respects
with all applicable laws, rules, regulations and orders, such compliance
to include, without limitation, compliance with ERISA, except where the
failure to so comply would not have a Guarantor Material Adverse Effect.
(c) INSURANCE. Maintain insurance with financially sound and
reputable insurers in such amounts and against such risks, as are
usually and customarily insured by companies engaged in a similar
business with respect to properties of a similar character.
(d) KEEPING OF BOOKS. Keep proper books of record and
accounts, in which full and correct entries shall be made of all
financial transactions and the assets and business of the Guarantor in
accordance with generally accepted accounting principles in effect from
time to time or as otherwise required by applicable rules and
regulations of any governmental agency or regulatory authority having
jurisdiction over the Guarantor.
(e) ACCESS TO RECORDS. Provide the Lender and its authorized
advisors and representatives reasonable access to all books, records, offices
and other facilities and properties of the Guarantor upon reasonable notice, and
allow the Lender or its authorized advisors or representatives (as the case may
be) to make such examinations thereof and copies of
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and abstracts from such books and records as the Lender or its
authorized advisors or representatives (as the case may be) may
reasonably request.
(f) PAYMENT OF TAXES, ETC. Pay and discharge before the same
shall become delinquent (i) all taxes, assessments and governmental
charges or levies imposed upon it or upon its properly and (ii) all
lawful claims that, if unpaid, might become a lien upon its property;
PROVIDED, HOWEVER, that Guarantor shall not be required to pay or
discharge any such tax, assessment, charge or claim that is being
contested good faith and by proper proceedings and as to which
appropriate reserves are being maintained, unless and until any Lien
(other than any Lien permitted under that certain Second Amended and
Restated Loan Agreement, dated as of April 10, 1996, by and among
Vanguard Cellular Operating Corp. and the financial institutions party
thereto, as amended and modified (the "SENIOR CREDIT FACILITY"))
resulting therefrom attaches to its property and becomes enforceable
against its other creditors.
(g) REPORTING. From time to time, furnish without cost to,
at the request of, the Lender, copies of all documents and certificates
delivered to any other lender or holder of Debt of the Guarantor
promptly after such request.
(h) NOTICE OF DEFAULTS. Promptly upon any officer of the
Guarantor obtaining knowledge thereof, give notice to the Lender of any
development, including, without limitation, any litigation,
investigation or proceeding affecting the Guarantor, which has a
Guarantor Material Adverse Effect, could reasonably be expected to have
a Guarantor Material Adverse Effect or, in the case of any litigation,
investigation or other proceeding, which could, if adversely decided,
reasonably be expected to have a Guarantor Material Adverse Effect.
(i) COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply with all
Environmental Laws and Environmental Permits applicable to its
operations and properties, noncompliance with which could have a
Guarantor Material Adverse Effect; obtain and renew all Environmental
Permits necessary for its operations and properties; and conduct any
investigation, study, sampling and testing, and undertake any cleanup,
removal, remedial or other action necessary to remove and clean up
Hazardous Materials from any of its properties, in accordance with the
requirements of all applicable Environmental Laws; PROVIDED, HOWEVER,
that the Guarantor shall not be required to undertake any such cleanup,
removal, remedial or other action to the extent that its obligation to
do so is being contested in good faith and by proper proceedings and
appropriate reserves are being maintained with respect to such
circumstances.
(j) PARI PASSU. Ensure that the Guaranteed Obligations shall
rank PARI PASSU with all present and future senior unsecured Obligations
of the Guarantor.
Section 8. NEGATIVE COVENANTS. The Guarantor covenants and agrees
that, so long as any part of the Guaranteed Obligations shall remain
unpaid, or the Lender shall have any Commitment, the Guarantor will not,
without the prior written consent of the Lender:
(a) MERGERS, ETC. Merge into or consolidate with any Person,
if after giving effect any such merger or consolidation, the Guarantor's
obligations under this Guaranty are not assumed by the corporation
formed by such merger or consolidation, and evidence of
C2-8
such assumption shall be evidenced in a writing reasonably satisfactory
in form and substance to the Lender.
(b) OPERATE OTHER THAN IN ORDINARY COURSE. Operate its
business, other than in the usual and ordinary course and other than
that which is consistent with the past practice established by the
Guarantor.
(c) AMENDMENT OR WAIVER. Amend, modify or change in any
manner the charter or bylaws (or other organizational documents) of the
Guarantor, which would materially adversely affect the Lender's rights
and benefits under the Loan Documents and the documents delivered
pursuant thereto.
(d) NEGATIVE PLEDGE. Enter into or suffer to exist any
agreement prohibiting or conditioning the creation or assumption of any
Lien upon any of its property or assets (including, without limitation,
any Shares) (i) other than in respect of any Debt of the Guarantor
outstanding as of the date hereof and (ii) to the extent that the
obligation under this Section 8(d) does not conflict with the Senior
Credit Facility and all agreements related thereto.
Section 9. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Guaranty and no consent to any departure by the
Guarantor therefrom shall in any event be effective unless the same
shall be in writing and signed by the Lender, and then such waiver or
consent shall be effective only in the specific instance and for the
specific purpose for which given.
Section 10. NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telegraphic,
telecopy or telex communication) and mailed, telegraphed, telecopied,
telexed or delivered to it, if to the Guarantor, at 0000 Xxxxxx Xxxxxx
Xxxx, Xxxxxxxxxx, XX 00000, U.S.A., Attention: General Counsel, telecopy
number: 0-000-000-0000, and if to the Lender, at 0 Xxxxxxx Xxxxxx #00
00 Xxxxxxxx Xxxxx, Xxxxxxxxx 000000, Attention: Mrs. Xxxxx Sim, or as to
each party, at such other address or telecopy number as shall be
designated by such party in a written notice to the other party in the
manner set forth herein. All such notices and other communications
shall, when mailed, telegraphed, telecopied or telexed, be effective
when deposited in the mails, delivered to the telegraph company,
transmitted by telecopier or confirmed by telex answerback, respectively.
Section 11. NO WAIVER; REMEDIES. No failure on the part of the
Lender to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein
provided are cumulative not exclusive of any remedies provided by law.
Section 12. RIGHT OF SET-OFF. Upon (a) the occurrence and during
the continuance of any Event of Default and (b) the making of the
request or the granting of the consent specified by Section 6.01 of the
Credit Agreement to authorize the Lender to declare the Note due and
payable pursuant to the provision of said Section 6.01, the Lender and
any of its Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted
C2-9
by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other
indebtedness at any time owing by the Lender or such Affiliate to or for
the credit or the account of the Guarantor against any and all of the
Obligations of the Guarantor now or hereafter existing under this
Guaranty, whether or not the Lender or such Affiliate shall have made
any demand under this Guaranty and although such Obligations may be
unmatured. The Lender agrees promptly to notify the Guarantor after any
such set-off and application; PROVIDED, HOWEVER, that the failure to
give such notice shall not affect the validity of such set-off and
application. The rights of the Lender and its Affiliates under this
Section are in addition to other rights and remedial (including, without
limitation, other rights of set-off) that the Lender may have.
Section 13. INDEMNIFICATION. Without limitation on any other
Obligations of the Guarantor or remedies of the Lender under this
Guaranty, the Guarantor shall, to the fullest extent permitted by law,
indemnify, defend and save and hold harmless the Lender from and
against, and shall pay on demand, any and all losses, liabilities,
damages, costs, expenses and charges with respect to the Guaranteed
Obligations suffered or incurred by the Lender (including the reasonable
fees and disbursements of the Lender's legal counsel) as a result of any
failure of any Guaranteed Obligations to be the legal, valid and binding
obligations of the Borrower enforceable against the Borrower in
accordance with their terms.
Section 14. CONTINUING GUARANTY; ASSIGNMENTS UNDER THE CREDIT
AGREEMENT. This Guaranty is a continuing guaranty and shall (a) remain
in full force and effect until the later of the payment in full in cash
of the Guaranteed Obligations and all other amounts payable under this
Guaranty and the Termination Date, (b) be binding upon the Guarantor,
its successors and assigns and (c) inure to the benefit of and be
enforceable by the Lender and their successors, transferees and assigns.
Without limiting the generality of the foregoing clause (c), the Lender
may assign or otherwise transfer all or any portion of its rights and
obligations under the Credit Agreement (including, without limitation,
all or any portion of the Commitment, the Advances owing to it and the
Note held by it) to any other Person, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted
to the Lender herein or otherwise, in each case as and to the extent
provided under the Credit Agreement.
Section 15. GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL,
ETC. (a) This Guaranty shall be governed by, and construed in
accordance with, the laws of the State of New York.
(b) The Guarantor 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 City, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Guaranty, or for recognition or enforcement of any judgment, and the
Guarantor hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined
in any such New York State court or, to the extent permitted by law, in
such federal court. The Guarantor agrees that process served either
personally or by registered mail, return recent requested, shall, to the
extent permitted by law, constitute adequate service of process in any
C2-10
such proceeding. The Guarantor 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 Guaranty shall affect any right that any Loan
Party may otherwise have to bring any action or proceeding relating to
this Guaranty in the courts of any jurisdiction.
(c) The Guarantor hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this
Guaranty in any New York State or federal court.
(d) The Guarantor 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.
(e) The Guarantor hereby waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort
or otherwise) arising out of or relating to this Guaranty, any document
delivered under this Guaranty, any Advance or the actions of the Lender
in the negotiations, administration, performance or enforcement hereof.
C2-11
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be
duly executed and delivered by its officer hereunto duly authorized as
of the date first above written.
VANGUARD CELLULAR
FINANCIAL CORPORATION
By:
---------------------------------
Name:
Title:
