EXHIBIT 10.12
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LOAN AGREEMENT
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LOAN AGREEMENT dated the 29th day of May, 1990, by and between ATLANTIC
TELE-NETWORK, INC., a Delaware corporation, whose mailing address is X.X. Xxx
0000, Xx. Xxxxxx, X.X. Xxxxxx Xxxxxxx 00000 (hereinafter referred to as the
"Company"), and BANCO POPULAR DE PUERTO RICO, a commercial banking institution
having an address at X.X. Xxx 0000, Xx. Xxxxxx, X.X. Xxxxxx Xxxxxxx 00000
(hereinafter referred to as the "Bank").
W I T N E S S E T H :
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1. REPRESENTATIONS. The Company represents, covenants and warrants that:
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1.1 CORPORATE EXISTENCE AND POWER. The Company is a corporation duly
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incorporated and validly existing under the laws of the state of Delaware and
has corporate power to make this Agreement and to borrow hereunder.
1.2 CORPORATE AUTHORITY. The making and performance by Company of this
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Agreement has been duly authorized by all necessary corporate action and will
not violate any provision of law or of its Articles of Incorporation or By-Laws
or result in the breach of, or constitute a default under, or result in the
creation of any lien, charge or encumbrance upon any prop-
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erty or assets of the Company pursuant to any indenture or bank loan or credit
agreement, or other agreement or instrument to which the Company is a party or
by which the Company or its property may be bound or affected.
1.3 FINANCIAL CONDITION. The most recent balance sheet of the Company, the
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statements of income and loss and surplus of the Company for the periods ending
on those dates, and other related information, heretofore furnished to the Bank,
are complete and correct and fairly represent the financial condition of the
Company as of the date(s) of said documents and as of the date(s) such financial
information was provided. To the best of the Company's knowledge and belief, the
Company has no material contingent obligations, liabilities for taxes, or
unusual forward or long term commitments, not disclosed by, or reserved against,
in said balance sheet, and, at the present time, there are no materials
unrealized or anticipated losses from any unfavorable commitments of the
Company. Said financial statements have been prepared in accordance with
generally accepted accounting principles and practices consistently maintained
by the Company throughout the period involved. Since the dates of such financial
statements, and since the date of the other financial information provided to
the Bank, there have been no material adverse changes in the financial condition
of the Company from that set forth in said
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balance sheet or in said other financial information as of the date thereof, and
dividends or other distributions have been declared or paid or made to its
stockholders.
1.4 LITIGATION. Except as the Bank has been advised in writing, there are
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no suits or proceedings pending, or, to the knowledge of the Company,
threatened, against or affecting the Company which, if adversely determined,
would have a material adverse effect on the financial condition or business of
the Company. There are no undisclosed proceedings by or before any governmental
commission, bureau or other administrative agency pending or, to the knowledge
of the Company, threatened against the Company.
1.5 TITLES; LIENS. The Company has good and marketable title to each of the
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fixed properties and assets reflected in its balance sheet free and clear of all
mortgages, liens and encumbrances not otherwise disclosed in said balance sheet.
2. THE LOAN.
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2.1 AMOUNT. The Bank agrees, on the terms and conditions of this Agreement,
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to extend to the Company a loan in the aggregate maximum principal sum of FIVE
HUNDRED THOUSAND DOLLARS ($500,000.00) (the "Loan"), which the Company hereby
accepts.
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2.2 PURPOSE. The purpose of the Loan is for the financing of letters of
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credit, letters of guaranty and to provide working capital to the Company.
2.3 TYPE. The Loan shall be in the form of a Five Hundred Thousand Dollar
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($500,000.00) revolving line of credit (the "Line of Credit") with any
outstanding balance due and payable three hundred sixty (360) days from the date
hereof. During the term of the Line of Credit, the Company, subject to the terms
and provisions stated herein, shall have the right, from time to time, to repay
all or any part of the principal balance outstanding and to request from the
Bank readvances of principal on the Loan. However, at no time during the term of
the Loan shall the principal sum outstanding on the Line of Credit exceed Five
Hundred Thousand Dollars ($500,000.00).
2.4 INTEREST. The Loan shall bear interest on the aggregate principal sum
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advanced and outstanding at a per annum rate equal to one-quarter of one percent
(1/4%) above the prime rate of Chase Manhattan Bank, N.A. ("Chase") from time to
time in effect (any change in interest resulting from the change in the prime
rate to be determined and effective at the start of the business day on which
such change is announced). The term "prime rate," as used herein, means that
rate of interest from time to time so designated and established by Chase at its
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principal offices in New York, New York, as its prime commercial lending rate,
which is not necessarily the lowest rate charged by Chase on its commercial
loans. Interest shall be calculated daily on a three hundred sixty (360) day
basis on the outstanding principal balance on the Loan, and shall be paid
monthly on the first day of each month.
2.5 PRINCIPAL REPAYMENTS. The Company shall repay the Line of Credit from
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time to time on a basis satisfactory to the Bank, provided that the entire
principal balance outstanding shall be due and payable in full three hundred
sixty (360) days from the date hereof together with all outstanding interest
accrued thereon. All payments under the Loan shall be applied first to accrued
interest and the remainder to the outstanding principal balance.
2.6 RENEWAL OF LINE OF CREDIT. The Line of Credit shall expire three
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hundred sixty (360) days from the date hereof, unless there has been a prior
default in which case it shall immediately terminate. Upon maturity and
repayment in full of any funds then outstanding under the Line of Credit, the
Company may apply to the Bank for a renewal of the Line of Credit by submitting
to the Bank such updated financial statements and other information of the
Company as the Bank may then require which statements and information shall be
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prepared in such manner and by such persons as are acceptable to the Bank;
provided, however, that for a period of thirty (30) consecutive days after the
initial term of the Line of Credit, and after the end of each renewal period
thereafter (if any) the Company shall have paid the Loan in full and shall have
no principal and interest outstanding under the Line of Credit. Upon review and
analysis of the updated financial statements and other information of the
Company and its Subsidiaries (as hereinafter defined), the Bank may, in its sole
discretion, renew the Line of Credit for such period of time as the Bank shall
advise the Company in writing.
2.7 THE NOTE. The Loan shall be evidenced by a Five Hundred Thousand Dollar
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($500,000.00) umbrella demand promissory note evidencing the Line of Credit
dated the date hereof, payable to the order of the Bank and due upon demand
according to its terms (the "Note").
3. CONDITIONS OF LENDING. The obligation of the Bank to make the initial
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advance under the Loan is subject to the following conditions precedent:
3.1 APPROVAL OF BANK COUNSEL. All legal matters incident to the
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transactions hereby contemplated shall be satisfactory to counsel for the Bank.
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3.2 OPINION OF BORROWER'S COUNSEL. The Bank shall have received the written
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opinion of counsel for the Company, satisfactory to the Bank and its counsel in
form and substance, covering the organization and corporate existence of the
Company and the power of the Company to make and perform their respective
obligations under this Agreement and the other agreements herein referred to.
3.3 PROOF OF CORPORATE ACTION. The Bank shall have received certified
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copies of all corporate action taken by the Company to authorize the execution
and delivery of this Agreement, the Note and the borrowing hereunder, and such
other documents as the Bank shall reasonably request.
3.4 COMMITMENT FEE. A non-refundable Commitment fee of Five Thousand
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Dollars ($5,000.00) shall have been paid by the Company to the Bank.
4. AFFIRMATIVE COVENANTS. The Company agrees that as long as credit shall
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remain available hereunder and until payment in full of the Note, unless the
Bank shall otherwise consent in writing, it will:
4.1 FURNISH FINANCIAL STATEMENTS. Furnish the Bank within one hundred
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twenty (120) days after the end of each fiscal year of the Company with a
consolidated balance sheet of
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the Company as well as the balance sheets for its subsidiaries, Atlantic
Tele-Network Company and Virgin Islands Telephone Corporation (VITELCO) (the
"Subsidiaries") as of the close of such fiscal year, and a statement of profit
and loss and surplus of the Company and the Subsidiaries for each such year, all
of said statements prepared by independent certified publc accountants
acceptable to the Bank.
4.2 PAYMENT OF TAXES. Pay and discharge or cause to be paid and discharged
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all taxes, assessments and governmental charges or liens imposed upon it or upon
its income or profits, or upon any property belonging to it, prior to the date
on which penalties attach thereto, and all lawful claims which, if unpaid, might
become a lien or charge upon the property of the Company, provided that the
Company shall not be required to pay any such tax, assessment, charge, levy or
claim the payment of which is being contested in good faith and by proper
proceedings.
4.3 NOTICE OF LITIGATION. Promptly give notice in writing to the Bank of
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all litigation and of all proceedings by or before any governmental regulatory
agency, against or affecting the Company, where the amount involved is in excess
of Fifty Thousand Dollars ($50,000.00) or which, if adversely de-
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termined, would otherwise have a materially adverse affect on the financial
condition or business of the Company.
4.4 DEPOSITS. Maintain a deposit account of the Company with the Bank.
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5. NEGATIVE COVENANTS. The Company agrees that so long as credit shall
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remain available hereunder and until payment in full of the Note, and all other
credit advanced by the Bank to the Company, without the prior written consent of
the Bank, it will not:
5.1 LIMITATION OF LIENS. Mortgage, pledge, hypothecate, assign, transfer,
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suffer to exist, or voluntarily subject to any lien or encumbrance to secure any
indebtedness, any of the property or assets of the Company, now owned or
hereafter acquired; excluding, however, from the operation of this covenant,
liens, mortgages or encumbrances in favor of the Bank.
5.2 LIMITATION OF INDEBTEDNESS. Create or incur any indebtedness or
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obligation for borrowed money or issue or sell any obligations of the Company,
excluding, however, from the operation of this covenant, the Loan hereunder or
other loans made by the Bank.
5.3 CONSOLIDATED OR MERGER. Merge into or consolidate with or into any
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corporation. For the purposes of this
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Section 5.3, the acquisition by the Company of all or substantially all of the
assets, together with the assumption of all or substantially all of the
obligations and liabilities, of any corporation shall be deemed to be a
consolidation of such corporation with the Company.
5.4 DISPOSITION OF ASSETS. Sell, lease, transfer or otherwise dispose of
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any of its assets (other than obsolete or worn-out property not used or useful
in its business), whether now owned or hereafter acquired, except in the
ordinary and regular course of the Company's business.
5.5 ACQUISITION OF STOCK OF COMPANY. Purchase, acquire, redeem or retire,
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or make any commitment to purchase, acquire, redeem or retire, any of the
capital stock of the Company whether now or hereafter outstanding.
5.6 CHANGE OF BUSINESS. Effect, cause, or permit any change from the
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business now conducted by the Company.
6. EXPENSES. The Company agrees to pay all expenses (including legal
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expenses and attorneys' fees) payable in connection with the execution and
delivery of this Agreement and the Note, as well as all expenses (including
legal expenses and reasonable attorneys' fees) of every kind of or incidental
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to the collection or enforcement of this Agreement and the Note.
7. EVENTS OF DEFAULT. If any one of the following "events of defaults"
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shall occur:
7.1 any representation or warranty made by the Company herein proves to
have been incorrect in any material respect as of the date of this Agreement or
as of the date on which it is made, or any statement, certificate or data
furnished by the Company hereunder proves to have been incorrect in any material
respect as of the date when the facts therein set forth were stated or
certified; or
7.2 default by the Company in the performance of any covenant or agreement
herein (except as set forth in Section 7.3 herein), which shall remain
unremedied for thirty (30) days after written notice thereof shall have been
given by the Bank; or
7.3 default in the due payment of the principal of the Note, or default in
the payment of interest on the Note, or of any other indebtedness owing by the
Company to the Bank now existing or hereafter incurred, for fifteen (15) days
after the same shall be due; or
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7.4 a judgment for the payment of money shall be rendered against the
Company and any such judgment shall remain unsatisfied and in effect for any
period of sixty (60) consecutive days without a stay of execution; or
7.5 the Company shall (i) apply for or consent to the appointment of a
receiver, trustee or liquidator of the Company, or of all or a substantial part
of the assets of the Company, (ii) be unable, or admit in writing, to the
inability to pay debts as they mature, (iii) make a general assignment for the
benefit of creditors, (iv) be adjudicated a bankrupt or insolvent, or (v) file a
voluntary petition in bankruptcy or an answer seeking reorganization or an
arrangement with creditors or to take advantage of any insolvency law or an
answer admitting the material allegations of a petition filed against the
Company in any bankruptcy, reorganization or insolvency proceeding, or corporate
action shall be taken by the Company for the purpose of effecting any of the
foregoing; or
7.6 an order, judgment or decree shall be entered, without the application,
approval or consent of the Company, by any court of competent jurisdiction,
approving a petition seeking reorganization of the Company or appointing a
receiver, trustee or liquidator of the Company or of all or a substantial part
of the assets of the Company, and such order, judgment or
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decree shall continue unstayed and in effect for any period of sixty (60)
consecutive days;
THEN, the Bank, at its option, may by written notice to the Company (i)
immediately terminate the Line of Credit and all commitments of the Bank
hereunder, and (ii) declare all principal and interest accrued on the Note, and
all other liabilities of the Company to the Bank to be forthwith due and
payable, whereupon the same shall become forthwith due and payable.
8. NO WAIVER; REMEDIES CUMULATIVE. No failure to exercise, and no delay in
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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 are not exclusive of any remedies provided by law.
9. DEFINITIONS.
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9.1 Any accounting term used herein shall, unless the context otherwise
specifies, be defined as most commonly defined in accordance with generally
accepted accounting principles.
10. CHANGE OF PARTIES. The Company will not assign this Agreement or any of
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the monies due hereunder without the
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prior written consent of the Bank. In the event of any such approved assignment
the Bank shall elect to continue to make the Loan hereunder or any part thereof
to the Company or its successor or assignee, all sums so advanced shall be
deemed advances under this Agreement and not in modification hereof. If the
Company is in default under this Agreement, or as a part of the sale,
consolidation, liquidation or merger of the Bank, the Bank may assign this
Agreement and the Note, in which event all of the terms hereof shall continue to
apply to the Loan, the Note, and any other documents entered into pursuant to
the Loan. All sums so advanced shall be deemed advances under this Agreement and
not in modification hereof.
11. NOTICE. Any notice required herein shall be deemed to have been
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properly served if sent by United States registered mail, postage prepaid,
addressed to the parties hereto at the addresses set forth above, or at such
other address as shall later be designated in writing.
12. CONSTRUCTION. This Agreement is being executed in and shall be
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construed in accordance with the laws of the United States Virgin Islands.
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IN WITNESS WHEREOF, the parties hereto have set their hands and seals the
day and year first above written.
ATLANTIC TELE-NETWORK, INC.
By: /s/Xxxxxxxxx X. Prior, Jr.
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Xxxxxxxxx X. Prior, Jr.
President
(SEAL)
Attest: /s/Xxxxxxxxx X. Xxxxx
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Xxxxxxxxx X. Xxxxx
Assistant Secretary
BANCO POPULAR DE PUERTO RICO
By: /s/Valentino X. XxXxxx
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Valentino X. XxXxxx
Regional Vice President
[COPY]
Atlantic Tele-Network, Inc.
Page 1 of 4
DEMAND NOTE
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$500,000.00 St. Xxxxxx, U.S.V.I.
May 29, 1990
FOR VALUE RECEIVED, ATLANTIC TELE-NETWORK, INC. (the "undersigned")
promises to pay to BANCO POPULAR DE PUERTO RICO (the "Bank"), or ORDER, the
principal sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00), or so much thereof
as may be advanced or upon repayment, readvanced by the Bank from time to time
after the date hereof pursuant to the terms of the Loan Agreement hereinafter
referred to, lawful money of the United States of America, with interest from
the date of any advance hereunder at a rate per annum equal to one-quarter of
one percent (1/4%) above the prime rate of the Chase Manhattan Bank ("Chase")
from time to time in effect (any change in interest resulting from the change in
such prime rate to be determined and effective at the beginning of the business
day on which each such change in the prime rate is announced). The term "prime
rate," as used herein, means that interest rate (which is not necessarily the
lowest rate charged by Chase) from time to time announced by Chase at its
principal offices in New York, New York, as its prime commercial lending rate.
Interest will be calculated daily on the outstanding principal sum on a three
hundred sixty (360) day basis and shall be due and pay-
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able monthly at the office of the Bank commencing on the first day of the month
following the date hereof and continuing on the first day of each subsequent
month until the principal and all accrued interest is paid in full. All payments
shall be applied first toward interest then accrued and the remainder, if any,
to the outstanding principal balance. The outstanding principal shall be payable
ON DEMAND at the offices of the Bank in St. Xxxxxx, U.S. Virgin Islands, or at
such other place as the holder may, from time to time, designate in writing.
AND IT IS EXPRESSLY AGREED that the credit evidenced hereby is a revolving
line of credit in the maximum principal sum of FIVE HUNDRED THOUSAND DOLLARS
($500,000.00), which, along with all interest accrued thereon, shall expire and
shall be due and payable three hundred sixty (360) days from the date hereof if
no prior default or demand shall have occurred. The undersigned may apply to the
Bank for renewal of the revolving line of credit in accordance with the terms
and provisions of the Loan Agreement of even date herewith (the "Loan
Agreement"); provided, however, that for a period of thirty (30) consecutive
days after the initial three hundred sixty (360) day period and for a period of
thirty (30) consecutive days after the end of each renewal period thereafter, if
renewed by the Bank, Borrower shall have paid the Loan in full and have no
principal and interest outstanding under this Note.
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This Note is subject to all of the terms, covenants and conditions of the
Loan Agreement and may not be changed orally, but only by an agreement in
writing signed by the party against whom enforcement of any change, waiver,
modification or discharge is sought.
In case recourse to the courts by the Bank or Note holder becomes necessary
in order to collect the whole or any unpaid part hereof together with all
accrued interest thereon, the undersigned agrees to pay any and all court
expenses, disbursements and attorneys' fees which may be incurred. The
undersigned expressly authorizes and empowers the Bank, at its option, at any
time, to appropriate and to apply to the payment of this Note and any other
obligation or obligations now existing or hereafter arising of the undersigned
to the Bank any and all moneys now or hereafter in the hands of the Bank on
deposit or otherwise to the Credit of or belonging to the undersigned.
Presentment for payment, notice of dishonor, protest and notice of protest
are hereby waived.
This Note is being issued pursuant to the Loan Agreement and any default
under the Loan Agreement shall constitute a default under this Note.
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This Note may be prepaid at any time, and from time to time, in whole or in
part, without any premium or penalty therefor; provided, however, that all such
prepayments shall be applied first toward interest then accrued.
Executed as a sealed instrument as of the date set forth above.
ATLANTIC TELE-NETWORK, INC.
By: /s/Xxxxxxxxx X. Prior, Jr.
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Xxxxxxxxx X. Prior, Jr.
President
(SEAL)
ATTEST:
/s/Xxxxxxxxx X. Xxxxx
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Xxxxxxxxx X. Xxxxx
Assistant Secretary
ADDENDUM TO LOAN AGREEMENT
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This Agreement is made this 25th day of February, 1993 between ATLANTIC
TELE-NETWORK, INC., a Delaware corporation, whose mailing address is X.X. Xxx
0000, Xxxxxxxxx Xxxxxx, X.X. Xxxxxx Xxxxxxx 00000 (hereinafter referred to as
the "Company") and BANCO POPULAR DE PUERTO RICO, a commercial banking
institution, whose mailing address is X.X. Xxx 0000, Xxxxxxxxx Xxxxxx, X.X.
Xxxxxx Xxxxxxx 00000 (hereinafter referred to as the "Bank").
WHEREAS, the Company and the Bank entered into a loan agreement dated May
29, 1990 (the "Loan Agreement") under the terms of which the Bank loaned to
Company the original principal sum Of FIVE HUNDRED THOUSAND DOLLARS
($500,000.00) in the form of a revolving line of credit facility; and
WHEREAS, the Bank and the Company wish to modify the terms of said Loan
Agreement to, among other things, increase the amount available under the line
of credit facility to THREE MILLION FIVE HUNDRED THOUSAND DOLLARS
($3,500,000.00) and to additionally provide for the issuance of corporate
VISA/Master Cards to authorized employees of the Company with an aggregate
credit limit of FIFTY THOUSAND DOLLARS ($50,000.00) for all credit cards issued.
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NOW, THEREFORE, the parties hereby agree as follows:
1. Except where otherwise specifically defined herein, all capitalized
terms used herein shall have the same meanings as originally defined in the Loan
Agreement.
2. Substitute the following language for Section 2.1 of the Loan Agreement:
2.1 AMOUNT. The Bank agrees, on the terms and conditions of this
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Agreement, to extend to the Company loans in the aggregate maximum
principal sum of THREE MILLION FIVE HUNDRED FIFTY THOUSAND DOLLARS
($3,550,000.00) (collectively, the "Loan"), which the Company hereby
accepts.
3. Substitute the following language for Section 2.2 of the Loan Agreement:
2.2 TYPE. The Loan shall be comprised of the following facilities:
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(a) A Three Million Five Hundred Thousand Dollar ($3,500,000.00)
revolving line of credit facility (the "Line of Credit"). The amount
under the Line of Credit available to be advanced to the Company shall
be reduced by the aggregate of any outstanding prior advances and the
total of all outstanding advances shall never exceed in the aggregate
the sum of Three Million Five Hundred Thousand Dollars
($3,500,000.00).
(b) A Corporate VISA/Master Card revolving credit card account (the
"Credit Card Account") with an aggregate credit limit of Fifty
Thousand Dollars ($50,000.00) for all credit cards issued to
authorized users designated by the Company pursuant to the terms and
conditions of the Corporate/Businesscard Agreement (the "Card
Agreement") executed simultaneously herewith.
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4. Substitute the following language for Section 2.3 of the Loan Agreement:
2.3 PURPOSE. (i) The proceeds of the Line of Credit are to be
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used for financing of irrevocable letters of credit, irrevocable
standby letters of credit, sight drafts, acceptances and normal
working capital requirements (including short term funding
requirements for working capital and expenditures in the course of
present and future telecommunications expansion, internal and external
plant and facilities acquisitions); provided, however, that usage
under the Line of Credit is limited to $1,000,000.00 for any foreign
telecommunications acquisition and expenditures in Guyana. Any such
acquisition or expenditures under the Line of Credit shall be in
writing and must have the prior approval of the Bank and be fully
secured up to the amount drawn-down under the $1,000,000.00 sub-limit.
(ii) The Credit Card Account shall be used by the users authorized by
the Company for such purposes as shall be approved by the Company not
otherwise inconsistent with the terms of this Agreement or the Card
Agreement.
5. Substitute the following language for Section 2.4 of the Loan Agreement:
2.4 INTEREST. (i) The Line of Credit shall bear interest at a
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rate per annum equal to three quarters of one percent (.75%) above the
prime rate as it varies (any change in interest resulting from the
change in the prime rate to be effective at the beginning of the day
on which such change in the prime rate is announced). The term "prime
rate" as used herein means that rate of interest from time to time
announced by The Chase Manhattan Bank, N.A. at its principal offices
in New York, New York as its commercial loan prime rate. Interest
shall be calculated daily on a three hundred sixty (360) day basis at
the rate hereinabove set forth. Interest accrued on the principal sum
from time to time outstanding on the Line of Credit at the rate
hereinabove set forth shall be payable monthly commencing on the first
day of the month following the date of the first draw hereunder
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and continuing until the entire principal sum and all acquired
interest is fully paid. (ii) Interest on the Credit Card Account shall
be calculated, and shall be paid by the Company, pursuant to the terms
of the Card Agreement.
6. Delete the word "hereof" in the first sentence of Section 2.5 of the
Loan Agreement and substitute the words "of the Addendum" therefor. Delete the
word "Loan" in the last sentence of Section 2.5 and substitute "Line of Credit"
therefor. Insert the words "late charges, if any, second to" between the words
"to" and "accrued" in the last sentence of Section 2.5. Add the following at the
end of Section 2.5:
The outstanding principal balance on the Credit Card Account shall be
repaid consistent with the terms of the Card Agreement.
7. Delete the word "hereof" in the first sentence of Section 2.6 of the
Loan Agreement and substitute the words "of the Addendum" therefor.
8. Substitute the following language for Section 2.7 of the Loan Agreement:
2.7 THE NOTE. The Line of Credit shall be evidenced by the substitute
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demand promissory note of the Company in the amount of THREE MILLION FIVE
HUNDRED THOUSAND AND 00/100 DOLLARS ($3,500,000.00) dated the date of the
Addendum (the "Note"), due and payable to the order of the Bank as
hereinabove and therein set forth.
9. Delete the words "the initial advance under" in Section 3 of the Loan
Agreement.
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10. Section 3.2 is hereby designated as Section 3.2.1 and the following new
section 3.2.2 is hereby added to the Loan Agreement:
3.2.2 OPINION OF BORROWER'S COUNSEL. For the Addendum, the Bank shall
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have received from counsel for the Company a favorable opinion dated the
date of the Addendum addressed to the Bank and satisfactory in scope and
form to the Bank and its counsel, covering the matters referred to in
Section 3.2.1 above.
11. Add the following to Section 3.4 of the Loan Agreement:
For the Addendum, the Bank shall have received from the Company a
non-refundable Commitment Fee in the amount of Thirty-Five Thousand Dollars
($35,000.00) and an Application Fee of ($150.00).
12. Add the following sub sections to Section 3 of the Loan Agreement:
3.5 CUSTOMARY CREDIT CHARGES. The Company shall be charged the
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standard fees of the Bank then in effect for the issuance of each letter of
credit or sight draft.
3.6 DRAW FEE. The Bank shall receive a draw fee equal to one-eighth of
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one percent (.125%) of each advance under the Line of Credit.
3.7 ANNUAL RENEWAL FEE. Subject to the provisions of Section 2.6
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hereof, the Bank shall receive an annual renewal fee of one-half of one
percent (.5%) of the amount at which the Line of Credit is renewed.
3.8 BANK APPROVAL OF ACQUISITIONS. Prior to any disbursements under
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the Line of Credit for short term funding of present or future
telecommunication
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acquisitions, any such acquisition, must be detailed in writing and must
have the approval of the Bank.
14. Substitute the following language for Section 4.1 of the Loan
Agreement:
4.1 FURNISH FINANCIAL STATEMENTS. Furnish the Bank (1) within sixty
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(60) days after the end of each fiscal year of the Company, in such form as
is acceptable to the Bank, the audited financial statements of (a) the
Company, including the Company's balance sheet, income statement and
auditor's notes accompanying the statements, and (b) the Company's
subsidiaries, Atlantic Tele-Network Company and Virgin Islands Telephone
Corporation (VITELCO) (the "Subsidiaries"), all of said statements prepared
by independent certified public accountants satisfactory to the Bank (2)
with such further information regarding the business affairs and financial
condition of the Company, at such times, in such form and in such manner,
as the Bank may require, and (3) with copies of quarterly 10Q reports of
the Company filed with the Securities and Exchange Commission.
15. Add the word "or" after the semicolon in Section 7.6 and add the
following Section 7.7 to the Loan Agreement;
7.7 a default by the Company under any of the conditions of the Card
Agreement.
16. Add the following Section 13 to the Loan Agreement:
13. LENDER'S OPTION TO ACCELERATE. Notwithstanding anything contained
-----------------------------
herein to the contrary and whether or not the Company is in default of the
terms hereof, the Bank reserves for itself, in its full discretion, and at
anytime, the right to suspend the Company's authority to obtain advances
under the Line of Credit and to declare the principal balance outstanding
under the Note to be due and payable; whereupon all sums advanced and
outstanding under the
-7-
Line of Credit together with all interest accrued thereon shall be
immediately due and payable by the Company to the Bank.
17. All representations, warranties, affirmative covenants and negative
covenants made by the Company and all conditions of lending agreed to by, and
applicable to, the Company in connection with the Loan Agreement are herein
restated and reaffirmed on the date of this Addendum.
18. Except as hereby modified, all other terms and provisions of the Loan
Agreement are hereby ratified and confirmed and incorporated herein by this
reference.
19. Except as specifically herein approved or waived by the Bank, no
default(s) of the Company, and no state of facts, which, if allowed to continue,
would constitute a default under the Loan Agreement, is hereby accepted,
approved or waived by the Bank. Notwithstanding the execution of this Addendum,
the Bank specifically reserves its right to declare the Company in default under
the Loan Agreement should any state of facts exist at the date hereof, known or
unknown to the Bank, which constitutes a default under the Loan Agreement as
modified by this Addendum.
-8-
IN WITNESS WHEREOF, the parties have executed this agreement as of the date
set forth above.
ATLANTIC TELE-NETWORK, INC.
By: /s/ Xxxxx X. Xxxx
-------------------------------------
Xxxxx X. Xxxx
Executive Vice President
[SEAL]
Attest: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxx
Assistant Secretary
BANCO POPULAR DE PUERTO RICO
By: /s/ Valentino X. XxXxxx
------------------------------------
Valentino X. XxXxxx
Senior Vice President
[COPY]
SUBSTITUTE DEMAND NOTE
----------------------
$5,500,000.00 St. Xxxxxx, U.S.V.1.
October 6, 1993
FOR VALUE RECEIVED, ATLANTIC TELE-NETWORK, INC., a Delaware corporation,
(the "undersigned") promises to pay to BANCO POPULAR DE PUERTO RICO (the
"Bank"), or ORDER, the principal sum of FIVE MILLION FIVE HUNDRED THOUSAND
DOLLARS ($5,500,000.00), lawful money of the United States of America, or so
much thereof as may be advanced or upon repayment readvanced by the Bank from
time to time after the date hereof pursuant to the terms of the Loan Agreement
dated May 29, 1990 as modified by the Addendum to Loan Agreement dated February
25, 1993 and the Second Addendum to Loan Agreement of even date herewith between
the undersigned and the Bank (collectively, the "Loan Agreement"), with interest
from the date drawn at a rate per annum equal to three-quarters of one percent
(.75%) above the prime rate as it varies (any change in interest resulting from
a change in the prime rate is to be effective at the beginning of the day on
which each such change in the prime rate is announced), calculated on a three
hundred sixty (360) day basis. The term "prime rate" as used herein means that
rate of interest from time to time announced by The Chase Manhattan Bank, N.A.
at its principal offices in New York, New York as its commercial loan prime
rate. Interest accrued on
-2-
the principal sun from time to time outstanding at the rate hereinabove set
forth shall be payable monthly commencing on the first day of the month
following the date of the first draw hereunder and continuing until the entire
principal sum and all accrued interest is fully paid. The outstanding principal
shall be payable ON DEMAND at the office of the Bank in St. Xxxxxx, U.S. Virgin
Islands, or at such other place as the holder may, from time to time, designate
in writing.
AND IT IS EXPRESSLY AGREED that the credit evidenced hereby is a revolving
line of credit in the maximum principal sum of FIVE MILLION FIVE HUNDRED
THOUSAND DOLLARS ($5,500,000.00), which, along with all interest accrued
thereon, shall expire and shall be due and payable three hundred sixty (360)
days from the date hereof if no prior default or demand shall have occurred;
provided, however, that the maturity date set forth herein may be extended by
the bank annually, in its sole discretion, in accordance with the terms and
provisions of, and as provided in, the Loan Agreement and provided, further,
that after the initial three hundred sixty (360) day period of this Note, and at
the end of each renewal period thereafter, there shall be a thirty (30) day
period during which there shall be no principal or interest outstanding under
this Note.
-3-
THE FOREGOING NOTWITHSTANDING, THIS NOTE IS AND SHALL BE CONSIDERED TO BE A
DEMAND INSTRUMENT SUBJECT TO CALL AT ANYTIME BY THE BANK IN ITS DISCRETION.
This Note may not be changed orally, but only by an agreement in writing
signed by the party against whom enforcement of any change, waiver, modification
or discharge is sought.
In case recourse to the courts by the holder of this Note becomes necessary
in order to collect the whole or any unpaid part thereof together with all
accrued interest thereon, the undersigned agrees to pay any and all court
expenses, disbursements, and attorneys' fees that may be incurred. The
undersigned expressly authorizes and empowers the Bank, at its option, at any
time, to appropriate and to apply to the payment of this Note, and any other
obligation or obligations now existing or hereafter arising of the undersigned
to the Bank, any and all monies now or hereafter in the hands of the Bank on
deposit or otherwise to the credit of or belong to the undersigned.
Presentment for acceptance or payment, notice of dishonor, protest and
notice of protest are hereby waived.
-4-
This Note is being issued pursuant to the Loan Agreement and any default by
the undersigned under the Loan Agreement shall constitute a default under this
Note.
This Note may be prepaid at any time, and from time to time, in whole or in
part, without any premium, or penalty therefor; provided, however, that all such
prepayments shall be applied first toward late charges, if any, second to
interest accrued on this Note, and then toward the outstanding principal
balance.
Executed as a sealed instrument as of the date set forth above.
ATLANTIC TELE-NETWORK, INC.
By: /s/ Xxxxxxxxx X. Prior, Jr.
---------------------------------
Xxxxxxxxx X. Prior, Jr.
President
[SEAL]
Attest: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------
Xxxxxxx X. Xxxxxxx
Secretary
SECOND ADDENDUM TO LOAN AGREEMENT
---------------------------------
This Agreement is made this 6th day of October, 1993 between ATLANTIC
TELE-NETWORK, INC., a Delaware corporation, whose mailing address is X.X. Xxx
0000, Xx. Xxxxx, X.X. Xxxxxx Xxxxxxx 00000 (hereinafter referred to as the
"Company") and BANCO POPULAR DE PUERTO RICO, a commercial banking institution,
whose mailing address is X.X. Xxx 0000, Xxxxxxxxx Xxxxxx, X.X. Xxxxxx Xxxxxxx
00000 (hereinafter referred to as the "Bank").
WHEREAS, the Company and the Bank entered in to a loan agreement dated May
29, 1990 (the "Loan Agreement") and an addendum to loan agreement dated February
25, 1993 ("the Addendum") under the terms of which the Bank loaned to the
Company the original principal sum of THREE MILLION FIVE HUNDRED THOUSAND
DOLLARS ($3,500,000.00) in the form of a revolving line of credit facility and
to provide for the issuance of corporate VISA/Master Cards to authorized
employees of the Company with an aggregate credit limit of FIFTY THOUSAND
DOLLARS ($50,000.00) for all credit cards issued; and
WHEREAS, the Bank and the Company wish to modify the terms of said Loan
Agreement and Addendum to increase the amount available under the line of credit
facility to FIVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($5,500,000.00).
-2-
NOW THEREFORE, the parties hereby agree as follows:
1. Except where otherwise specifically defined herein, all capitalized
terms used herein shall have the same meanings as originally defined in the Loan
Agreement.
2. Substitute the following language for Section 2.1 of the Loan Agreement:
2.1 AMOUNT. The Bank agrees, on the terms and conditions of this
------
Agreement, to extend to the Company loans in the aggregate maximum
principal sum of FIVE MILLION FIVE HUNDRED FIFTY THOUSAND DOLLARS
($5,550,000.00) (collectively, the "Loan"), which the Company hereby
accepts.
3. Substitute the following language for Section 2.2(a) of the Loan
Agreement as amended by the Addendum:
2.2 TYPE. The Loan shall be comprised of the following facilities:
----
(a) A Five Million Five Hundred Thousand Dollars ($5,500,000.00)
revolving line of credit facility (the "Line of Credit"). The amount under
the Line of Credit available to be advanced to the Company shall be reduced
by the aggregate of any outstanding prior advances and the total of all
outstanding advances shall never exceed in the aggregate the sum of Five
Million Five Hundred Thousand Dollars ($5,500,000.00).
4. Delete the word "hereof" in the first sentence of Section 2.5 of the
Loan Agreement and substitute the words "of the Second Addendum" therefor.
-3-
5. Delete the word "hereof" in the first sentence of Section 2.6 of the
Loan Agreement and substitute the words "of the Second Addendum" therefor.
6. Substitute the following language for Section 2.7 of the Loan Agreement;
2.7 THE NOTE. The Line of Credit shall be evidenced by the substitute
--------
demand promissory note of the Company in the amount of FIVE MILLION FIVE
HUNDRED THOUSAND DOLLARS ($5,500,000.00) dated the date of the Second
Addendum (the "Note"), due and payable to the order of the Bank as
hereinabove and therein set forth.
7. The following new section 3.2.3 is hereby added to the Loan Agreement:
3.2.3 OPINION OF BORROWER'S COUNSEL. For the Second Addendum, the Bank
-----------------------------
shall have received from counsel for the Company a favorable opinion dated
the date of the Second Addendum addressed to the Bank and satisfactory in
scope and form to the Bank and its counsel, covering the matters referred
to in Section 3.2.1 above.
8. All representations, warranties, affirmative covenants and negative
covenants made by the Company and all conditions of lending agreed to by, and
applicable to, the Company in connection with the Loan Agreement are herein
restated and reaffirmed on the date of this Second Addendum.
9. Except as hereby modified, all other terms and provisions of the Loan
Agreement and the Addendum are hereby
-4-
ratified and confirmed and incorporated herein by this reference).
10. Except as specifically herein approved or waived by the Bank, no
default(s) of the Company, and no state of facts, which, if allowed to continue,
would constitute a default under the Loan Agreement and the Addendum, is hereby
accepted, approved or waived by the Bank. Notwithstanding the execution of this
Second Addendum, the Bank specifically reserves its right to declare the Company
in default under the Loan Agreement and Addendum should any state of facts exist
at the date hereof, known or unknown to the Bank, which constitutes a default
under the Loan Agreement as modified by the Addendum and this Second Addendum.
ATLANTIC TELE-NETWORK, INC.
By: /s/ Xxxxxxxxx X. Prior, Jr.
-------------------------------------
Xxxxxxxxx X. Prior, Jr.
President
[SEAL]
Attest: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxx
Secretary
-5-
BANCO POPULAR DE PUERTO RICO
By: /s/ Valentino X. XxXxxx,
------------------------------------
Valentino X. XxXxxx
Senior Vice President
[COPY] Atlantic Tel-Network, Inc.
Page 1 of 4
SUBSTITUTE DEMAND NOTE
----------------------
$3,500,000.00 St. Xxxxxx, U.S.V.I.
February 25, 1993
FOR VALUE RECEIVED, ATLANTIC TELE-NETWORK, INC., a Delaware corporation,
(the "undersigned") promises to pay to BANCO POPULAR DE PUERTO RICO (the
"Bank"), or ORDER, the principal sum of THREE MILLION FIVE HUNDRED THOUSAND
DOLLARS ($3,500,000.00), lawful money of the United States of America, or so
much thereof as may be advanced or upon repayment readvanced by the Bank from
time to time after the date hereof pursuant to the terms of the loan agreement
dated May 29, 1990 as modified by the addendum to loan agreement of even date
herewith between the undersigned and the Bank (collectively, the "Loan
Agreement"), with interest from the date drawn at a rate per annum equal to
three-quarters of one percent (.75%) above the prime rate as it varies (any
change in interest resulting from a change in the prime rate is to be effective
at the beginning of the day on which each such change in the prime rate is
announced), calculated on a three hundred sixty (360) day basis. The term "prime
rate" as used herein means that rate of interest from time to time announced by
The Chase Manhattan Bank, N.A. at its principal offices in New York, New York as
its commercial loan prime rate. Interest accrued on the principal sum from time
to time outstanding at the rate hereinabove
Atlantic Tel-Network, Inc.
Page 2 of 4
set forth shall be payable monthly commencing on the first day of the month
following the date of the first draw hereunder and continuing until the entire
principal sum and all accrued interest is fully paid. The outstanding principal
shall be payable ON DEMAND at the office of the Bank in St. Xxxxxx, U.S. Virgin
Islands, or at such other place as the holder may, from time to time, designate
in writing.
AND IT IS EXPRESSLY AGREED that the credit evidenced hereby is a revolving
line of credit in the maximum principal sum of THREE MILLION FIVE HUNDRED
THOUSAND DOLLARS ($3,500,000.00), which, along with all interest accrued
thereon, shall expire and shall be due and payable three hundred sixty (360)
days from the date hereof if no prior default or demand shall have occurred;
provided, however, that the maturity date set forth herein may be extended by
the Bank annually, in its sole discretion, in accordance with the terms and
provisions of, and as provided in, the Loan Agreement and provided, further,
that after the initial three hundred sixty (360) day period of this Note, and at
the end of each renewal period thereafter, there shall be a thirty (30) day
period during which there shall be no principal or interest outstanding under
this Note.
Atlantic Tel-Network, Inc.
Page 3 of 4
THE FOREGOING NOTWITHSTANDING, THIS NOTE IS AND SHALL BE CONSIDERED TO BE A
DEMAND INSTRUMENT SUBJECT TO CALL AT ANYTIME BY THE BANK IN ITS DISCRETION.
This Note may not be changed orally, but only by an agreement in writing
signed by the party against whom enforcement of any change, waiver, modification
or discharge is sought.
In case recourse to the courts by the holder of this Note becomes necessary
in order to collect the whole or any unpaid part thereof together with all
accrued interest thereon, the undersigned agrees to pay any and all court
expenses, disbursements, and attorneys' fees that may be incurred. The
undersigned expressly authorizes and empowers the Bank, at its option, at any
time, to appropriate and to apply to the payment of this Note, and any other
obligation or obligations now existing or hereafter arising of the undersigned
to the Bank, any and all monies now or hereafter in the hands of the Bank on
deposit or otherwise to the credit of or belonging to the undersigned.
Presentment for acceptance or payment, notice of dishonor, protest and
notice of protest are hereby waived.
Atlantic Tel-Network, Inc.
Page 4 of 4
This Note is being issued pursuant to the Loan Agreement and any default by
the undersigned under the Loan Agreement shall constitute a default under this
Note.
This Note may be prepaid at any time, and from time to time, in whole or in
part, without any premium or penalty therefor; provided, however, that all such
prepayments shall be applied first toward late charges, if any, second to
interest accrued on this Note, and then toward the outstanding principal
balance.
Executed as a sealed instrument as of the date set forth above.
ATLANTIC TELE-NETWORK, INC.
By: /s/ Xxxxx X. Xxxx
------------------------------------
Xxxxx X. Xxxx
Executive Vice President
[SEAL]
Attest: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxx
Assistant Secretary