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FIRST AMENDED AND RESTATED CREDIT AGREEMENT
Among
QWEST COMMUNICATIONS INTERNATIONAL INC.
BANK OF AMERICA, N.A.
as Administrative Agent
BANK OF AMERICA, N.A.
THE BANK OF NEW YORK
FIRST UNION NATIONAL BANK
CITIBANK, N.A.
as Arranging Agents
and
LENDERS
Dated as of March 9, 2000
With
BANC OF AMERICA SECURITIES LLC
as Lead Arranger and Sole Book Running Manager
FIRST UNION SECURITIES, INC.
BNY CAPITAL MARKETS, INC.
SALOMON SMITH BARNEY INC.
as Co-Arrangers
FIRST UNION SECURITIES, INC.
THE BANK OF NEW YORK
SALOMON SMITH BARNEY INC.
as Co-Syndication Agents
--------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<C> <S> <C>
ARTICLE I. DEFINITIONS
1.01. Definitions................................................................................... 1
1.02. Accounting and Other Terms.................................................................... 30
ARTICLE II. THE LOAN FACILITY
2.01. Loans......................................................................................... 30
2.02. Making Advances............................................................................... 32
2.03. Evidence of Debt for Borrowed Money........................................................... 35
2.04. Optional Prepayments.......................................................................... 35
2.05. Mandatory Prepayments......................................................................... 36
2.06. Repayment..................................................................................... 36
2.07. Interest...................................................................................... 37
2.08. Default Interest.............................................................................. 38
2.09. Continuation and Conversion Elections......................................................... 38
2.10. Fees.......................................................................................... 39
2.11. Reduction of Commitments...................................................................... 40
2.12. Funding Losses................................................................................ 41
2.13. Computations and Manner of Payments........................................................... 42
2.14. Yield Protection; Changed Circumstances....................................................... 44
2.15. Use of Proceeds............................................................................... 46
2.16. Extension Option and Conversion Option Relating to the Working Line Loan...................... 47
2.17. Rights of Borrower in Respect of Consequential Losses......................................... 48
2.18. Rights of Borrower in Respect of Failure of any Lender to Fund or Extend the Option Date...... 49
ARTICLE III. LETTERS OF CREDIT
3.01. Issuance of Letters of Credit................................................................. 49
3.02. Letters of Credit Fee......................................................................... 49
3.03. Reimbursement Obligations..................................................................... 50
3.04. Lenders' Obligations.......................................................................... 51
3.05. Administrative Agent's Obligations............................................................ 52
ARTICLE IV. CONDITIONS PRECEDENT
4.01. Conditions Precedent to the Initial Advance and the Issuance of the Initial Letter of Credit.. 53
4.02. Conditions Precedent to All Advances and Letters of Credit.................................... 54
ARTICLE V. REPRESENTATIONS AND WARRANTIES
5.01. Representations and Warranties................................................................ 56
5.02. Survival of Representations and Warranties.................................................... 63
ARTICLE VI. GENERAL COVENANTS
6.01. Preservation of Existence and Similar Matters................................................. 63
6.02. Business; Compliance with Applicable Law...................................................... 63
</TABLE>
ii
<PAGE>
<TABLE>
<C> <S> <C>
6.03. Maintenance of Properties..................................................................... 63
6.04. Accounting Methods and Financial Records...................................................... 64
6.05. Insurance..................................................................................... 64
6.06. Payment of Taxes and Claims................................................................... 64
6.07. Visits and Inspections........................................................................ 64
6.08. Use of Proceeds............................................................................... 64
6.09. Indemnity..................................................................................... 65
6.10. Environmental Law Compliance.................................................................. 65
6.11. Restricted Subsidiary Designation............................................................. 66
6.12. Fiber Capacity................................................................................ 66
6.13. UCC Filings................................................................................... 66
6.14. Sinking Funds and Defeasance.................................................................. 66
6.15. Reimbursement of Costs and Expenses........................................................... 66
ARTICLE VII. INFORMATION COVENANTS
7.01. Quarterly Financial Statements and Information................................................ 67
7.02. Annual Financial Statements and Information................................................... 67
7.03. Compliance Certificates....................................................................... 68
7.04. Copies of Other Reports and Notices........................................................... 68
7.05. Notice of Litigation, Default and Other Matters............................................... 69
7.06. ERISA Reporting Requirements.................................................................. 69
7.07. Copies of Other Reports and Notices Regarding U S WEST Restricted Subsidiaries................ 70
ARTICLE VIII. NEGATIVE COVENANTS
8.01. Financial Covenants........................................................................... 71
8.02. Debt for Borrowed Money....................................................................... 71
8.03. Liens......................................................................................... 75
8.04. Investments................................................................................... 75
8.05. Liquidation, Disposition and Merger........................................................... 77
8.06. Guaranties; Contingent Liabilities............................................................ 79
8.07. Restricted Payments........................................................................... 79
8.08. Affiliate Transactions........................................................................ 80
8.09. Compliance with ERISA......................................................................... 80
8.10. Capital Stock................................................................................. 81
8.11. Sale and Leaseback............................................................................ 81
8.12. Sale or Discount of Receivables............................................................... 81
8.13. Limitation on Restrictive Agreements.......................................................... 81
8.14. Amendment of Material Agreements.............................................................. 82
8.15. Name Changes.................................................................................. 82
8.16. Unrestricted Subsidiaries..................................................................... 82
8.17. Limitation on IRU Agreements.................................................................. 83
8.18. Acquisitions, Creation of Subsidiaries........................................................ 83
ARTICLE IX. EVENTS OF DEFAULT
9.01. Events of Default............................................................................. 85
9.02. Remedies upon Default......................................................................... 89
</TABLE>
iii
<PAGE>
<TABLE>
<C> <S> <C>
9.03. Cumulative Rights............................................................................. 89
9.04. Waivers....................................................................................... 89
9.05. Performance by Administrative Agent or any Lender............................................. 90
9.06. Expenditures.................................................................................. 90
9.07. Control....................................................................................... 90
9.08. Compliance Concerning U S WEST Companies and Their Assets..................................... 90
ARTICLE X. THE ADMINISTRATIVE AGENT
10.01. Authorization and Action...................................................................... 92
10.02. Administrative Agent's Reliance, Etc.......................................................... 92
10.03. Bank of America, N.A. and Affiliates.......................................................... 92
10.04. Lender Credit Decision........................................................................ 93
10.05. Indemnification by Lenders.................................................................... 93
10.06. Successor Administrative Agent................................................................ 93
ARTICLE XI. MISCELLANEOUS
11.01. Amendments and Waivers........................................................................ 94
11.02. Notices....................................................................................... 94
11.03. Parties in Interest........................................................................... 97
11.04. Assignments and Participations................................................................ 97
11.05. Sharing of Payments........................................................................... 98
11.06. Right of Set-off.............................................................................. 98
11.07. Costs, Expenses, and Taxes.................................................................... 98
11.08. Rate Provision................................................................................ 99
11.09. Severability.................................................................................. 100
11.10. Exceptions to Covenants....................................................................... 100
11.11. Counterparts.................................................................................. 100
11.12. GOVERNING LAW; WAIVER OF JURY TRIAL........................................................... 100
11.13. ENTIRE AGREEMENT.............................................................................. 101
11.14. Release of Conditional Early Release Unlimited Guaranty....................................... 101
11.15. Confidentiality............................................................................... 101
11.16. Amendment and Restatement..................................................................... 102
11.17. Option Date and Extension..................................................................... 102
</TABLE>
iv
<PAGE>
v
<PAGE>
vi
<PAGE>
Table of Schedules and Exhibits
Schedules
---------
<TABLE>
<CAPTION>
<S> <C> <C>
Schedule 1.01 - Terms and Conditions of Subordinated Debt
Schedule 1.02 - Map of Nationwide Fiber Optic Communications Network
Schedule 1.03 - List of certain U S WEST Guarantees to be assumed by the Borrower
Schedule 5.01(a) - Jurisdictions of Incorporation, Ownership and Capital Structure - the Borrower and its Restricted
Subsidiaries
Schedule 5.01(f) - Non-Compliance with FCC or any applicable PUC
Schedule 5.01(h) - Existing Litigation of the Borrower and its Restricted Subsidiaries
Schedule 5.01(p) - Environmental Disclosure
Schedule 5.01(q) - Description of Subsidiaries and Equity Investments
Schedule 8.02 - Existing Debt and Liabilities of the Borrower and the Restricted Subsidiaries
Schedule 8.03 - Existing Liens of the Borrower and the Restricted Subsidiaries
Schedule 8.04 - Existing Investments of the Borrower and the Restricted Subsidiaries
Schedule 8.06 - Existing Guaranties of the Borrower and the Restricted Subsidiaries
Schedule 8.08 - Permitted Affiliate Non-Market Transactions
Schedule 8.16 - Permitted Transactions among the Borrower and the Restricted Subsidiaries and the Unrestricted
Subsidiaries
</TABLE>
Exhibits
--------
<TABLE>
<CAPTION>
<S> <C> <C>
Exhibit A - Form of Revolver A Note
Exhibit B - Form of Working Line Note
Exhibit C - Form of Revolver B Note
Exhibit D - Form of Swingline Note
Exhibit E - Form of Compliance Certificate
Exhibit F - Form of Borrowing Notice
Exhibit G - Form of Conversion/Continuation Notice
Exhibit H - Form of Assignment and Acceptance
Exhibit I - Form of Conditional Early Release Unlimited Guaranty
Exhibit J - Form of Notice of Change of Senior Unsecured Debt Rating
Exhibit K - Form of Confidentiality Agreement for U S WEST Information
</TABLE>
v
<PAGE>
$1,000,000,000
QWEST COMMUNICATIONS INTERNATIONAL INC.
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED CREDIT AGREEMENT is dated as of March 9,
2000, among QWEST COMMUNICATIONS INTERNATIONAL INC., a Delaware corporation (the
"Borrower"), the Lenders (as defined below) and BANK OF AMERICA, N.A., as a
Lender and Administrative Agent, with BANC OF AMERICA SECURITIES LLC, as Lead
Arranger and Sole Book Running Manager, FIRST UNION SECURITIES, INC., BNY
CAPITAL MARKETS, INC. AND SALOMON SMITH BARNEY INC. as Co-Arrangers, FIRST UNION
SECURITIES, INC., THE BANK OF NEW YORK and SALOMON SMITH BARNEY INC., as Co-
Syndication Agents, BANK OF AMERICA, N.A., THE BANK OF NEW YORK, FIRST UNION
NATIONAL BANK and CITIBANK, N.A. as Arranging Agents and the Managing Agents (as
defined below).
BACKGROUND.
WHEREAS, the Borrower, the Administrative Agent, the Co-Arrangers, the
Arranging Agents, the Managing Agents and certain of the Lenders entered into
that certain Original Credit Agreement, dated as of March 31, 1999.
WHEREAS, the Original Credit Agreement provides for 1) one five year
revolving credit facility in the amount of $250,000,000 (which such loan
facility includes a letter of credit availability of not more than $80,000,000
and a swingline facility of not more than $25,000,000), 2) one 364-day revolving
credit facility in the amount of $500,000,000, and 3) one five year revolving
credit facility in the amount of $250,000,000).
WHEREAS, the Borrower and the Majority Lenders have elected to amend
certain of the provisions of the Original Credit Agreement in accordance with
the terms of Section 11.01 thereof and restate it in its entirety;
AGREEMENT.
NOW, THEREFORE, for valuable consideration hereby acknowledged, the parties
hereto agree as follows:
ARTICLE I. DEFINITIONS
1.01. Definitions. As used in this Agreement, the following terms have
the respective meanings indicated below (such meanings to be applicable equally
to both the singular and plural forms of such terms):
1
<PAGE>
"Acquisition Date" means the date of consummation of the U S WEST
Acquisition.
"Additional New Credit Facility Debt" means the amount of increased
borrowing made available to the Borrower on a committed basis under the New
Credit Facility in excess of $1,000,000,000.
"Administrative Agent" means Bank of America, N.A., in its capacity as
Administrative Agent hereunder, or any successor Administrative Agent appointed
pursuant to Section 10.06 hereof.
"Advance" means an advance made by a Lender to the Borrower pursuant to
Section 2.01 hereof, including Revolver A Advances, Working Line Advances,
Revolver B Advances, Swingline Advances and Refinancing Advances.
"Affiliate" means a Person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled By or is Under Common Control with
another Person.
"Agreement" means this First Amended and Restated Credit Agreement, as
hereafter amended, modified, increased, extended, restated or supplemented from
time to time.
"Amendment and Restatement Closing Date" means the date hereof.
"Annualized Operating Cash Flow" means the product of (a) Operating Cash
Flow for the most recently completed two fiscal quarters, times (b) two.
"Applicable Law" means in respect of any Person, all provisions of Laws of
Tribunals applicable to such Person, and all orders and decrees of all courts
and arbitrators in proceedings or actions to which the Person in question is a
party.
"Applicable Commitment Fee Percentage" means the per annum commitment fees
set forth below for the Loans, as adjusted in each case according to the
circumstances set forth below:
<TABLE>
<CAPTION>
Applicable
Commitment
Fee
Percentages
-----------------------------------------------------------
Senior Revolver Working
Unsecured Debt A Loan Line Loan
Ratings of the Borrower and
Revolver
B Loan
-----------------------------------------------------------
<S> <C> <C>
BB- / Ba3 or lower 0.400% 0.275%
-----------------------------------------------------------
BB / Ba2 0.275% 0.225%
-----------------------------------------------------------
BB+ / Ba1 0.250% 0.200%
-----------------------------------------------------------
BBB- / Baa3 0.200% 0.175%
-----------------------------------------------------------
BBB / Baa2 or 0.175% 0.150%
higher
-----------------------------------------------------------
</TABLE>
2
<PAGE>
After each date which the Administrative Agent receives from the Borrower a
Notice of Change of Senior Unsecured Debt Rating in accordance with the terms of
Section 7.02(c) hereof, the Applicable Commitment Fee Percentage payable by the
Borrower shall be subject to reduction or increase, as applicable and as set
forth in the table above, three Business Days after receipt by the
Administrative Agent of each such notice. In the event that the Senior
Unsecured Debt Rating of the Borrower has ratings differing (a) by up to one
level, the lowest Applicable Commitment Fee Percentage will apply and (b) by
more than one level, the Applicable Commitment Fee Percentage for the level
immediately below the highest Senior Unsecured Debt Rating will apply. Except
as set forth in the following sentence, any such increase or reduction in the
Applicable Commitment Fee Percentages provided for herein shall be effective
three Business Days after receipt by Administrative Agent of such Notice of
Change of Senior Unsecured Debt Rating. If any such Notice of Change of Senior
Unsecured Debt Rating is not timely delivered in accordance with the terms of
Section 7.02(c) hereof, the Applicable Commitment Fee Percentages shall be
determined as if the Senior Unsecured Debt Rating is BB- / Ba3 or lower,
effective from the date such Notice of Change of Senior Unsecured Debt Rating
should have been received until such time as such notice is received.
"Applicable Margin" means, (a) with respect to LIBOR Advances, 1.00% per
annum which may be adjusted based on the below listed situations, and (b) with
respect to Base Advances, 0.000% per annum, in each case which may be adjusted
based on the below listed situations as follows: after the date which the
Administrative Agent and the Lenders receive a Compliance Certificate required
to be delivered in accordance with the terms of Section 7.01 and Section 7.02
hereof, the Applicable Margin will be adjusted as set forth in the last
paragraph of this definition to the following per annum percentages set forth in
Column B below applicable in the following situations set forth in Column A
below:
<TABLE>
<CAPTION>
Column A Column B Column C
---------------------------------------------------------------------------------------
Applicable Usage
Margin Premium**
Percentages*
---------------------------------------------------------------------------------------
More than
Base $667,000,000
Senior Advances LIBOR is drawn
Unsecured Debt Advances under the
Rating of the Borrower Loans and the
New Credit
Facility
---------------------------------------------------------------------------------------
<S> <C> <C> <C>
BB- / Ba3 or lower 0.500% 1.500% 0.000%
---------------------------------------------------------------------------------------
BB / Ba2 0.250% 1.250% 0.000%
---------------------------------------------------------------------------------------
BB+ / Ba1 0.000% 1.000% 0.000%
---------------------------------------------------------------------------------------
BBB- / Baa3 0.000% 0.750% 0.125%
---------------------------------------------------------------------------------------
BBB / Baa2 or 0.000% 0.500% 0.125%
higher
---------------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
* At all times that the Total Leverage Ratio is greater than
4.00 to 1.00, the Applicable Margin Percentage set forth in
Column B above in each case shall be increased by .250%.
** If the sum of (i) the aggregate amount of outstanding Loans
plus (ii) the aggregate amount of outstanding loans under the New
Credit Facility exceeds $667,000,000, then the Applicable Margins
set forth in Column B above for LIBOR Advances shall be increased
by the percentage amount set forth in Column C above.
After the date which the Administrative Agent receives a Compliance Certificate
in accordance with the terms of Section 7.01 and Section 7.02 hereof, the
Applicable Margin payable by the Borrower shall be subject to reduction or
increase, as applicable and as set forth in the table above, (a) three Business
Days after receipt by the Administrative Agent of each Notice of Change of
Senior Unsecured Debt Rating, and (b) on a quarterly basis according to the
performance of the Borrower as tested by the Total Leverage Ratio. In the event
that the Senior Unsecured Debt Rating of the Borrower has ratings differing (i)
by up to one level, the highest Senior Unsecured Debt Rating will apply and (ii)
by more than one level, the Applicable Margin for the level immediately below
the highest Senior Unsecured Debt Rating will apply. Except as set forth in
the following sentence, any such increase or reduction in the Applicable Margin
provided for herein shall be effective (A) three Business Days after receipt by
Administrative Agent of each Notice of Change of Senior Unsecured Debt Rating
delivered in accordance with the terms of Section 7.02(c) hereof and (B) three
Business Days after receipt by the Administrative Agent of the applicable
financial statements and corresponding Compliance Certificate delivered in
accordance with Section 7.01(a) hereof. If financial statements, Compliance
Certificate and/or a Notice of Change of Senior Unsecured Debt Rating of the
Borrower setting forth the Total Leverage Ratio and the Senior Unsecured Debt
Rating are not received by the Administrative Agent by the dates required
pursuant to Section 7.01 or 7.02 hereof (as such times may be extended by a
waiver in accordance with the terms hereof), the Applicable Margin shall be
determined as if the Total Leverage Ratio exceeds 4.00 to 1.00 and the Senior
Unsecured Debt Rating is BB- / Ba3 or lower, during such time and until such
time as such financial statements, Compliance Certificate and/or Notice of
Change of Senior Unsecured Debt Rating are received. For the final quarter of
any fiscal year of the Borrower, at the Borrower's option, the Borrower may
provide the unaudited financial statements of the Borrower, subject only to
year-end adjustments, for the purpose of determining the Total Leverage Ratio
and adjusting the Applicable Margin.
"Applicable Specified Percentage" means with respect to any Lender, in the
case of the Revolver A Loan, such Lender's Revolver A Specified Percentage, in
the case of the Revolver B Loan, such Lender's Revolver B Specified Percentage
and in the case of the Working Line Loan, such Lender's Working Line Loan
Specified Percentage.
"Application" means any stand-by letter of credit application delivered to
Administrative Agent for or in connection with any stand-by Letter of Credit
pursuant to Article III hereof, in Administrative Agent's standard form for
stand-by letters of credit.
"Arranging Agents" means Bank of America, N.A., The Bank of New York, First
Union National Bank and CitiBank, N.A. and any other successor arranging agent
agreed to by the Borrower, the Administrative Agent and the other Arranging
Agents.
4
<PAGE>
"Assignment and Acceptance" means an assignment and acceptance entered into
by a Lender and an assignee in accordance with the terms and conditions of
Section 11.04 hereof, and accepted by Administrative Agent, in the form of
Exhibit H hereto.
---------
"Auditor" means KPMG Peat Marwick, L.L.P., or other independent certified
public accountants selected by the Borrower and reasonably acceptable to
Arranging Agents.
"Authorized Officer" means, with respect to the Borrower and its Restricted
Subsidiaries respectively, any of the Chief Executive Officer, the Chief
Operating Officer, the Chief Financial Officer, the General Counsel or the
Treasurer of the Borrower and any other officer designated as an Authorized
Officer by an Authorized Officer to the Administrative Agent in writing.
"Backbone" means that portion of the Original Borrower's and the Original
Restricted Subsidiaries' nationwide fiber optic communications network
identified on Schedule 1.02 hereto, consisting of approximately 18,815 route
-------------
miles of fiber optic cable (i) owned, constructed or acquired, or to be owned,
constructed or acquired, by the Borrower and the Original Restricted
Subsidiaries or (ii) related to which the Borrower has been granted an IRU, as
such Backbone may be adjusted or redirected through changes to designated routes
by the Borrower and the Original Restricted Subsidiaries from time to time as
the Borrower and the Original Restricted Subsidiaries may deem advisable in its
reasonable business judgment.
"Bank Affiliate" means the holding company of any Lender, or any wholly
owned direct or indirect subsidiary of such holding company or of such Lender.
"Base Advance" means an Advance under the Revolver A Loan, the Revolver B
Loan or the Working Line Loan, as applicable, bearing interest at the Base Rate.
"Base Rate" means a per annum interest rate equal to the lesser of (a) the
Highest Lawful Rate, and (b) the sum of the Applicable Margin plus the higher of
(i) a fluctuating rate per annum as shall be in effect from time to time
announced or published by Bank of America, N.A. as its prime rate, and which may
not necessarily be the lowest interest rate charged by Bank of America, N.A.,
and (ii) the Federal Funds Rate in effect at such time plus .50%.
"Board of Directors" means the Board of Directors of the Borrower or any
committee thereof duly authorized to act on behalf of such Board.
"Borrowing" means a borrowing of the same Type made on the same day.
"Borrowing Notice" has the meaning set forth in Section 2.02(a) hereof.
"Business Day" means a day on which banks are open for the transaction of
business as required by this Agreement in New York, New York, Denver, Colorado
and Dallas, Texas and, with respect to any LIBOR Advance, a domestic business
day in London, England and a day on which commercial banks are open for
international business in London, England (including dealings in United States
dollar deposits), and as otherwise relevant to the determination to be made or
the action to be taken.
5
<PAGE>
"Capital Expenditures" means capital expenditures, as defined in accordance
with GAAP.
"Capital Leases" means capital leases and subleases, as defined in
accordance with GAAP.
"Capital Stock" means, as to any Person, the equity interests in such
Person, including, without limitation, the shares of each class of capital stock
of any Person that is a corporation, each class of partnership interests
(including without limitation, general, limited and preference units) in any
Person that is a partnership, and each membership interest in any Person that is
a limited liability company.
"Change of Control" means the occurrence of any one or more of the
following events: (i) any Person or group of Persons (within the meaning of
Section 13(d) of the Securities Exchange Act of 1934, as amended), other than
Philip F. Anschutz or the Anschutz Company or any of their Affiliates, shall
obtain ownership or control in one or more series of transactions of more than
fifty percent (50%) of the common stock of the Borrower or fifty percent (50%)
of the voting power of the Borrower entitled to vote on the election of members
of the board of directors of the Borrower, or (ii) any event which results in
the Borrower's failure to own and control, directly or indirectly, 100% of the
Capital Stock of any Guarantor, so long as such Guarantor is obligated under the
Conditional Early Release Unlimited Guaranty; provided that nothing in the U S
-------------
WEST Acquisition shall constitute a Change of Control.
"Co-Arrangers" means First Union Securities, Inc., BNY Capital Markets,
Inc. and Salomon Smith Barney Inc.
"Co-Syndication Agents" means The Bank of New York, First Union Securities,
Inc. and Salomon Smith Barney Inc.
"Code" means the Internal Revenue Code of 1986, as amended, and any
reference to any provision of the Code shall include all successor provisions
thereto.
"Commitment" means the Revolver A Commitment, the Working Line Commitment
and the Revolver B Commitment.
"Commitment Fee" means the Revolver A Commitment Fee, the Revolver B
Commitment Fee and the Working Line Commitment Fee.
"Communications Act" means, collectively, the Communications Act of 1934,
as amended by the Telecommunications Act of 1996, and as further amended, and
the rules and regulations promulgated thereunder, as from time to time in
effect.
"Compliance Certificate" means a certificate of an Authorized Officer in
the form of Exhibit E hereto, (a) certifying that such individual has no actual
---------
knowledge that a Default or Event of Default has occurred and is continuing, or
if a Default or Event of Default has occurred and is continuing, a statement as
to the nature thereof and the action being taken or proposed to be taken with
respect thereto, (b) setting forth detailed calculations with respect to the
covenants described in Section 8.01 hereof, (c) certifying to the appropriate
Senior Unsecured Debt Rating, Applicable Margin and Applicable Commitment Fee
Percentage, (d) certifying as to consummated Permitted Acquisitions described in
Section 8.18 (d)(ii) hereof, (e) prior to and during the Waiver Period,
certifying as to any changes in Original Restricted Subsidiaries, Unrestricted
Subsidiaries that are
6
<PAGE>
not U S WEST Companies and Qwest Material Subsidiaries and (f) after the Waiver
Period, certifying as to any changes in Original Restricted Subsidiaries,
Unrestricted Subsidiaries that are not U S WEST Companies and Consolidated
Material Subsidiaries.
"Confidentiality Agreement" means a confidentiality agreement in favor of U
S WEST to be executed by Lenders wishing to receive confidential information
regarding U S WEST Companies prior to the Acquisition Date, substantially in the
form of Exhibit H attached hereto.
---------
"Conditional Early Release Unlimited Guaranty" means the Guaranty, executed
in substantially similar form by the Guarantor, guarantying payment and
performance of the Obligations, substantially in the form of Exhibit I attached
---------
hereto, as such agreement may be amended, modified, renewed or extended from
time to time, and each subsequent guaranty substantially (with or without the
conditional early release) in the form of Exhibit I hereto executed by any
---------
Person, as each such agreement may be amended, modified, renewed or extended
from time to time.
"Consequential Loss" with respect to (a) the Borrower's payment of all or
any portion of the then-outstanding principal amount of a LIBOR Advance on a day
other than the last day of the related Interest Period, including, without
limitation, payments made as a result of the acceleration of the maturity of a
Note, (b) subject to Administrative Agent's prior consent, a LIBOR Advance made
on a date other than the date on which the Advance is to be made according to
Section 2.02(a) or Section 2.09 hereof to the extent such Advance is made on
such other date at the request of the Borrower, or (c) any of the circumstances
specified in Sections 2.04, 2.05, 2.06 and 2.11 hereof on which a LIBOR Advance
or a Letter of Credit may cause a Consequential Loss to be incurred, means any
actual out of pocket loss, cost or expense incurred by any Lender as a result of
the timing of the payment or Advance or in liquidating, redepositing,
redeploying or reinvesting the principal amount so paid or affected by the
timing of the Advance or the circumstances described in Sections 2.04, 2.05,
2.06 or 2.11 hereof, which amount shall be the sum of (i) the interest that, but
for the payment or timing of Advance, such Lender would have earned in respect
of that principal amount, reduced, if such Lender is able to redeposit,
redeploy, or reinvest the principal amount, by the interest earned by such
Lender as a result of redepositing, redeploying or reinvesting the principal
amount plus (ii) any expense or penalty incurred by such Lender by reason of
liquidating, redepositing, redeploying or reinvesting the principal amount.
Each determination by each Lender of any Consequential Loss is, in the absence
of manifest error, presumptive evidence of the validity of such claim.
"Consolidated Material Subsidiary" means on any date of determination after
the Waiver Period, any Restricted Subsidiary that generated in the most recently
completed 12 month period in excess of 10% of the consolidated Operating Cash
Flow of the Borrower and its Restricted Subsidiaries and "Consolidated Material
Subsidiaries" means, on any date of determination after the Waiver Period, the
smallest group of one or more Restricted Subsidiaries which in the aggregate
generated in the most recently completed 12 month period not less than 80% of
the consolidated Operating Cash Flow of the Borrower and its Restricted
Subsidiaries.
"Consolidated Net Income" means, with respect to the Borrower and the
Restricted Subsidiaries, the net income of the Borrower and the Restricted
Subsidiaries, on a consolidated basis, determined in accordance with GAAP.
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"Consolidated Net Worth" means, with respect to the Borrower and the
Restricted Subsidiaries, the net worth of the Borrower and the Restricted
Subsidiaries, on a consolidated basis, determined in accordance with GAAP.
"Contingent Liability" means, as to any Person, any obligation or Guaranty,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Debt or obligation of any other Person in any manner,
whether directly or indirectly, including without limitation any obligation of
such Person, direct or indirect, (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Debt or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such Debt, (b)
to purchase Property or services for the purpose of assuring the owner of such
Debt of its payment, or (c) to maintain the solvency, working capital, equity,
cash flow, fixed charge or other coverage ratio, or any other financial
condition of the primary obligor so as to enable the primary obligor to pay any
Debt or to comply with any agreement relating to any Debt or obligation, but
excluding endorsement of checks, drafts and other instruments in the ordinary
course of business, provided that this definition of "Contingent Liability"
-------------
shall not include Guaranties by the Borrower or any Restricted Subsidiary of the
Borrower of any obligations of the Borrower or any Wholly Owned Restricted
Subsidiary.
"Continue," "Continuation" and "Continued" each refer to the continuation
pursuant to Section 2.09 hereof of a LIBOR Advance from one Interest Period to
the next Interest Period.
"Control" or "Controlled By" or "Under Common Control" mean possession,
direct or indirect, of power to direct or cause the direction of management or
policies (whether through ownership of voting securities, by contract or
otherwise); provided that, in any event any Person which beneficially owns (a)
--------
25% or more (in number of votes) of the securities having ordinary voting power
for the election of directors of a corporation shall be conclusively presumed to
control such corporation and (b) 25% or more of the interest in capital or
profits of a partnership shall be conclusively presumed to control such
partnership.
"Controlled Group" means all members of a controlled group of corporations
other than any U S WEST Company and all trades or businesses (whether or not
incorporated) other than any U S WEST Company which are under common control
with the Borrower, any Obligor, any Original Restricted Subsidiary or any
Unrestricted Subsidiary that is not a U S WEST Company and which, together with
Borrower, any Obligor, any Original Restricted Subsidiary or any Unrestricted
Subsidiary that is not a U S WEST Company, are treated as a single employer
under Section 414(b), (c), (m) or (o) of the Code.
"Conversion Date" means, with respect to the Working Line Loan, the date
upon which the Working Line converts from a revolving loan to a term loan, in
accordance with the terms of Section 2.16(b) hereof.
"Conversion or Continuance Notice" has the meaning set forth in Section
2.09(b) hereof.
"Conversion Option" means, with respect to the Working Line Loan, that
option to be exercised by the Borrower on the Option Date or the Extension Final
Maturity in accordance with the terms of Section 2.16(b) hereof to convert the
Working Line Loan to a term loan.
"Debt" means all obligations, contingent or otherwise, which in accordance
with GAAP are required to be classified on the balance sheet as liabilities, and
in any event including (without
8
<PAGE>
duplication) (a) Capital Leases, (b) Contingent Liabilities that are required to
be recorded in accordance with GAAP, (c) liabilities secured by any Lien on any
Property, regardless of whether such secured liability is with or without
recourse, and (d) installment payment non-compete agreements.
"Debt for Borrowed Money" means, with respect to any Person or Persons at
any date, without duplication, all Debt of such Person or Persons that
constitutes (a) all obligations of such Person or Persons for borrowed money,
letters of credit (or applications for letters of credit) or other similar
instruments, (b) all obligations of such Person or Persons evidenced by bonds,
debentures, notes or other similar instruments, excluding any surety or
performance bonds, (c) all obligations of such Person or Persons to pay the
deferred purchase price of property or services, but only if such deferral is in
excess of 90 days, provided that, trade accounts payable and other accrued
-------- ----
liabilities arising in the ordinary course of business shall not be considered
Debt for Borrowed Money, (d) all obligations under Capital Leases of such Person
or Persons, (e) installment payment non-compete agreements for such Person or
Persons, provided that when this definition is applicable to the Borrower and
any of its Restricted Subsidiaries, only the amount by which all such non-
compete agreements for the Borrower and the Restricted Subsidiaries when
aggregated together exceed $5,000,000, and (f) all Contingent Liabilities
relating to obligations of another Person (other than the Borrower or a Wholly
Owned Restricted Subsidiary of the Borrower with respect to Debt of another
Wholly Owned Restricted Subsidiary or the Borrower) of the type described in (a)
through (e) above.
"Debtor Relief Laws" means applicable bankruptcy, reorganization,
moratorium, or similar Laws, or principles of equity affecting the enforcement
of creditors' rights generally.
"Default" means any event specified in Section 9.01 hereof, whether or not
any requirement in connection with such event for the giving of notice, lapse of
time, or happening of any further condition has been satisfied.
"Designated U S WEST Restricted Subsidiary" means U S WEST Communications,
Inc.
"Disposition" and "Disposed" means any sale, lease, abandonment, transfer,
disposal, exchange or other transfer of ownership, leasehold interest or control
of any asset.
"Distribution" means, as to any Person, (a) any declaration or payment of
any distribution or dividend (other than a common stock dividend or a dividend
in options, warrants or other rights to acquire common Capital Stock of a
Person) on, or the making of any pro rata distribution, loan, advance, or
investment to or in any holder of, any partnership interest or shares of Capital
Stock or other equity interest of such Person (or the establishment of a sinking
fund or otherwise setting aside of funds for any such purpose), or (b) any
purchase, redemption, or other acquisition or retirement for value of any shares
of partnership interest or Capital Stock or other equity interest of such Person
(or the establishment of a sinking fund or otherwise setting aside of funds for
any such purpose).
"Environmental Claim" means any written notice by any Tribunal alleging
liability for damage to the environment, or by any Person alleging liability for
personal injury (including sickness, disease or death), resulting from or based
upon (a) the presence or release (including sudden or non-sudden, accidental or
non-accidental, leaks or spills) of any Hazardous Material at, in or from
property, whether or not owned by the Borrower or any of its Original Restricted
9
<PAGE>
Subsidiaries, or (b) circumstances forming the basis of any violation, or
alleged violation, of any Environmental Law.
"Environmental Laws" means the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. (S)9601 et seq.) ("CERCLA"), the
Hazardous Material Transportation Act (49 U.S.C. (S)1801 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. (S)6901 et seq.) ("RCRA"), the Federal
Water Pollution Control Act (33 U.S.C. (S)1251 et seq.), the Clean Air Act (42
U.S.C. (S)7401 et seq.), the Toxic Substances Control Act (15 U.S.C. (S)2601 et
seq.), and the Occupational Safety and Health Act (29 U.S.C. (S)651 et seq.)
("OSHA"), as such laws have been or hereafter may be amended or supplemented,
and any and all analogous federal, or state or local, Laws in effect from time
to time.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the rulings and regulations issued thereunder, as from time to time
in effect.
"ERISA Affiliate" means any Person, other than a U S WEST Company, that for
purposes of Title IV of ERISA is a member of the Controlled Group of the
Borrower, any Obligor, any Original Restricted Subsidiary or any Unrestricted
Subsidiary that is not a U S WEST Company, or is under common control with
Borrower, any Obligor, any Original Restricted Subsidiary or any Unrestricted
Subsidiary that is not a U S WEST Company, within the meaning of Section 414(c)
of the Code, and the regulations and rulings issued thereunder.
"ERISA Event" means (a) a reportable event, within the meaning of Section
4043 of ERISA, unless the 30-day notice requirement with respect thereto has
been waived by the PBGC with respect to a Plan, (b) the issuance 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), (c) the withdrawal by the
Borrower, any Original Restricted Subsidiary of the Borrower, or an 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, (d) the failure
by the Borrower, any Original Restricted Subsidiary, or any ERISA Affiliate to
make a payment to a Plan required under Section 302 of ERISA, (e) the adoption
of an amendment to a Plan by the Borrower, an Original Restricted Subsidiary or
an ERISA Affiliate requiring the provision of security to such Plan, pursuant to
Section 307 of ERISA, or (f) 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 that constitutes grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, a Plan.
"Event of Default" means any of the events specified in Section 9.01 of
this Agreement, provided there has been satisfied any requirement in connection
therewith for the giving of notice, lapse of time, or happening of any further
condition.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.
"Existing Financing" means collectively, the Qwest 9.47% Senior Discount
Notes, the Qwest 10.875% Senior Notes, the Qwest 8.29% Senior Discount Notes,
the Qwest 7.50% Senior Notes, the Qwest 7.25% Senior Notes, the LCI Notes and
the Trol Transaction, in each case in effect on any relevant date of reference
and only to the extent that any indebtedness exists under any such documentation
on such date.
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<PAGE>
"Existing Financing Documentation" means collectively, the Qwest 9.47%
Senior Discount Notes Documentation, the Qwest 10.875% Senior Notes
Documentation, the Qwest 8.29% Senior Discount Notes Documentation, the Qwest
7.50% Senior Notes Documentation, the Qwest 7.25% Senior Notes Documentation,
the LCI Notes Documentation and the Trol Transaction Documentation.
"Existing Letter of Credit" means that certain stand-by Letter of Credit
Number C000638, in the amount of $36,649,997.50, issued by Bank of America,
N.A., for the account of the Borrower, and for the benefit of American
Communication Network, Inc.
"Extension Final Maturity" means, with respect to the Working Line Loan in
the event that the Borrower and the Lenders have agreed to an Extension Option,
that date which is the earlier of (a) 364 days after the Option Date and (b) the
maturity date of the New Credit Facility (it being understood that if the
"Maturity Date" as defined in the New Credit Facility is extended for all
amounts outstanding thereunder by agreement of the parties in writing, such
extended date shall be the maturity date of the New Credit Facility as used in
this definition).
"Extension Option" means, with respect to the Working Line Loan, that
option to be exercised by the Borrower and agreed to by the SuperMajority
Lenders in accordance with the terms of Section 2.16(a) hereof to extend the
Working Line Loan an additional 364 day period beyond the Option Date.
"FCC" means the Federal Communications Commission, or any governmental
agency succeeding to the functions thereof.
"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 which
is a Business Day, the average of the quotations for such date on such
transactions received by Administrative Agent from three federal funds brokers
of recognized standing selected by it.
"Fee Letters" means those certain Fee Letters, dated March 31, 1999 and
February 8, 2000, between the Borrower and the Administrative Agent, and all
other fee letters executed among the Borrower or any Lender[s] relating to this
Agreement and the Loans, as such letters may be amended, modified, substituted,
replaced, or increased from time to time.
"GAAP" means generally accepted accounting principles applied on a
consistent basis. Application on a consistent basis shall mean that the
accounting principles observed in a current period are comparable in all
material respects to those applied in a preceding period, except for new
developments or statements promulgated by the Financial Accounting Standards
Board and other changes in accounting methods permitted by generally accepted
accounting principles.
"Guarantor" means LCI.
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<PAGE>
"Guaranty" means a guaranty executed by any Person of the obligations of
another Person, or any agreement by which such Person assumes, guarantees,
endorses, contingently agrees to purchase or provide funds for the payment of,
or otherwise becomes liable upon, the obligation of any other Person, or agrees
to maintain the net worth or working capital or other financial condition of any
other Person, or otherwise assures any creditor or such other Person against
loss, including, without limitation, any comfort letter that has the effect of
assuring any such creditor against loss, or take-or-pay contract and shall
include without limitation, the contingent liability of such Person in
connection with any application for a letter of credit.
"Hazardous Materials" means all materials subject to regulation under any
Environmental Law, including without limitation materials listed in 49 C.F.R.
(S) 172.101, Hazardous Substances, explosive or radioactive materials, hazardous
or toxic wastes or substances, petroleum or petroleum distillates, asbestos, or
material containing asbestos.
"Hazardous Substances" means hazardous waste as defined in the Clean Water
Act, 33 U.S.C. (S) 1251 et seq., the Comprehensive Environmental Response
Compensation and Liability Act as amended by the Superfund Amendments and
Reauthorization Act, 42 U.S.C. (S) 9601 et seq., the Resource Conservation
Recovery Act, 42 U.S.C. (S) 6901 et seq., and the Toxic Substances Control Act,
15 U.S.C. (S) 2601 et seq.
"Highest Lawful Rate" means at the particular time in question the maximum
rate of interest which, under Applicable Law, any Lender is then permitted to
charge on the Obligations. If the maximum rate of interest which, under
Applicable Law, any Lender is permitted to charge on the Obligations shall
change after the date hereof, the Highest Lawful Rate shall be automatically
increased or decreased, as the case may be, from time to time as of the
effective time of each change in the Highest Lawful Rate without notice to the
Borrower.
"Income Tax Expense" means the aggregate income Taxes accrued by the
Borrower and the Restricted Subsidiaries for the relevant period of
determination.
"Insufficiency" means, with respect to any Plan, the amount, if any, of its
unfunded benefit liabilities within the meaning of Section 4001(a)(18) of ERISA.
"Interest Coverage Ratio" means, on any date of determination for the
Borrower and the Restricted Subsidiaries, the ratio of (a) Operating Cash Flow
for the most recently completed 12 month period to (b) the aggregate amount of
cash Interest Expense actually paid during the most recently completed 12 month
period, provided that, for purposes of this calculation, Operating Cash Flow and
-------------
Interest Expense shall be calculated as if all assets (including the acquisition
of Capital Stock of Restricted Subsidiaries) acquired on any date during the
period of determination were acquired on the first day in such period of
determination, and all assets (including the acquisition of Capital Stock of
Restricted Subsidiaries) sold on any date during the period of determination
were sold on the first day in such period of determination.
"Interest Expense" means, for the Borrower and the Restricted Subsidiaries
on a consolidated basis for any period of determination, the gross interest
expense for any period on Total Debt, determined in accordance with GAAP, minus
the sum of (a) interest income for such period, plus (b) to the extent not
included in the determination of such gross interest expense, upfront costs or
12
<PAGE>
fees expended during such period in connection with the execution and delivery
of documentation relating to the Loan Papers.
"Interest Period" means, with respect to any LIBOR Advance, the period
beginning on the date the Advance is made or continued as a LIBOR Advance and
ending one, two, three, six or, to the extent available as determined by
Administrative Agent, twelve months thereafter (as the Borrower shall select),
provided, however, that:
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(a) the Borrower may not select any Interest Period that ends after
any scheduled principal repayment date unless, after giving effect to such
selection, the aggregate principal amount of LIBOR Advances having Interest
Periods that end on or prior to such principal repayment date, shall be at
least equal to the principal amount of Advances due and payable on and
prior to such date;
(b) 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;
(c) whenever the first day of any Interest Period occurs on a day of
an initial calendar month for which there is no numerically corresponding
day in the calendar month that succeeds such initial calendar month by the
number of months equal to the number of months in such Interest Period,
such Interest Period shall end on the last Business Day of such succeeding
calendar month; and
(d) with respect to the Working Line Loan, Interest Periods for LIBOR
Advances must be six months or less.
"Interest Rate Protection Agreement" means an interest rate swap, cap,
collar or similar interest rate protection agreement between the Borrower, any
Lender or any Bank Affiliate.
"Investment" means any direct or indirect purchase or other acquisition of,
or a beneficial interest in, any Capital Stock or other securities of any other
Person, or any direct or indirect loan, advance, or capital contribution to or
investment in any other Person, including without limitation the incurrence or
sufferance of Debt or accounts receivable of any other Person that are not
current assets or do not arise from sales to that other Person in the ordinary
course of business.
"IRU" means an indefeasible right to use fiber or telecommunications
capacity, including the right to use the related transport and network
equipment.
"IRU Agreement" means an agreement pursuant to which an interest in an IRU
is sold or leased or otherwise transferred.
"KPNQwest Joint Venture" means the KPNQwest Joint Venture as described on
Schedule 5.01(q) hereto.
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"Law" means any constitution, statute, law, ordinance, regulation, rule,
order, writ, injunction, or decree of any Tribunal.
"LCI" means LCI International, Inc., a Delaware corporation.
"LCI Notes" means those certain $350,000,000 7.25% Senior Notes Due 2007
issued by LCI.
"LCI Notes Documentation" means that certain Indenture related to the LCI
Notes and all other agreements and documentation relating to the LCI Notes.
"Lead Arranger" means Banc of America Securities LLC.
"Lenders" means the lenders listed on the signature pages of this
Agreement, and each transferee which hereafter becomes a party to this Agreement
pursuant to Section 11.04 hereof or pursuant to an amendment to this Agreement
who is owed any portion of the Obligations, and each Bank Affiliate that is owed
any portion of the Obligations pursuant to (i) an Interest Rate Protection
Agreement or (ii) Section 2.14 or Section 2.17 hereof, in each case for so long
as each such Person is owed any portion of the Obligations or is obligated to
make any Advance or issue any Letter of Credit hereunder.
"Lending Office" means, with respect to each Lender, its branch or
affiliate, (a) initially, the office of each Lender, branch or affiliate
identified on each Lender's signature page hereto, and (b) subsequently, such
other office of each Lender, branch or affiliate as each Lender may designate to
the Borrower and Administrative Agent as the office from which the Advances of
each Lender will be made and maintained and for the account of which all
payments of principal and interest on the Advances and the Commitment Fee will
thereafter be made. Lenders may have more than one Lending Office for the
purpose of making Base Advances and LIBOR Advances.
"Letter of Credit Commitment" means, on any date of determination, an
amount equal to the lesser of (a) $80,000,000 and (b) the Revolver A Commitment
minus the sum of (i) all outstanding Revolver A Advances under the Revolver A
Loan and (ii) all Swingline Advances.
"Letters of Credit" means the irrevocable standby letters of credit issued
by Administrative Agent under and pursuant to Article III hereof, as each may be
amended, modified, substituted, increased, replaced, renewed or extended from
time to time in accordance with the provisions of Article III hereof, and
specifically including the Existing Letter of Credit, as it may be amended,
modified, substituted, increased, replaced, renewed or extended from time to
time in accordance with the provisions of Article III hereof.
"LIBOR Advance" means an Advance under the Revolver A Loan, the Revolver B
Loan or the Working Line Loan bearing interest at the LIBOR Rate.
"LIBOR Lending Office" means, with respect to each Lender, the office
designated as its "LIBOR Lending Office" on each Lender's signature page hereto,
or such other office of Lender or any of its affiliates hereafter designated by
notice to the Borrower and Administrative Agent.
"LIBOR Rate" means, for any LIBOR Advance for any Interest Period
therefore, a rate per annum equal to the lesser of (a) the Highest Lawful Rate
and (b) the sum of (i) the Applicable Margin, plus (ii) the rate per annum
(rounded upwards, if necessary, to the nearest one-one
14
<PAGE>
hundredth (1/100th) of one percent (1%)) appearing on Telerate Page 3750 (or any
successor page) as the London interbank offered rate for deposits in United
States dollars at approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period. If for any reason such rate is not
available, the term "LIBOR Rate" shall mean, for any LIBOR Advance for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest one-one hundredth (1/100th) of one percent (1%)) appearing on
Reuters Screen LIBO page as the London interbank offered rate for deposits in
United States dollars at approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period for a term comparable to
such Interest Period; provided, however, if more than one rate is
-------- -------
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.
"License" means, as to the Borrower or any Restricted Subsidiary of the
Borrower, any license, permit, consent, certificate of need, authorization,
certification, accreditation, franchise, approval, or grant of rights by, or any
filing or registration with, any Tribunal or third Person (including without
limitation, the FCC or any applicable PUC) necessary for such Person to own,
maintain, or operate its business or Property.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien, or
charge of any kind, any conditional sale or other title retention agreement, any
lease in the nature thereof, and the filing of or agreement to give any
financing statement or other similar form of public notice under the Laws of any
jurisdiction (except for the filing of a financing statement or notice in
connection with an (a) operating lease or (b) the true consignment of goods to
the Borrower or any Restricted Subsidiary as consignee).
"Litigation" means any proceeding, claim, lawsuit or arbitration, conducted
by or before any Tribunal or arbitrator, including without limitation
proceedings, claims, lawsuits, under or pursuant to any environmental,
occupational, safety and health, antitrust, unfair competition, securities, Tax,
or other Law, or under or pursuant to any contract, agreement, or other
instrument.
"Loans" means all three of the Revolver A Loan, the Revolver B Loan and the
Working Line Loan, and "Loan" means any one of the Revolver A Loan, the Revolver
B Loan or the Working Line Loan, as applicable in the context used.
"Loan Papers" means this Agreement, the Notes, the Conditional Early
Release Unlimited Guaranty, the Fee Letters, financing statements, any Interest
Rate Protection Agreement and related documents entered into by the Borrower
with any Lender or any Bank Affiliate, all Letters of Credit, all Applications
and all other agreements between the Borrower or any Restricted Subsidiary and
the Administrative Agent related to any Letter of Credit, other fee letters,
Assignment and Acceptances, post-closing letters, all security agreements,
pledges, mortgages, deeds of trust, assignments, leasehold mortgages, leasehold
deeds of trust, collateral assignments and other agreements and documentation
relating to the Liens securing the Obligations, and all other documents,
instruments, agreements, or certificates executed or delivered from time to time
by any Person in connection with this Agreement or as security for the
Obligations hereunder, granting collateral or otherwise, as each such agreement
may be amended, modified, substituted, replaced or extended from time to time.
"Majority Lenders" means, on any date of determination, any combination of
Lenders having collectively at least 51% of the aggregate amount of Advances
under this Agreement; provided,
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<PAGE>
however, that if no Advances are outstanding under this Agreement, such term
means any combination of Lenders having Total Specified Percentages equal to at
least 51% of the aggregate Commitment.
"Managing Agents" means each of ABN AMRO Bank N.V., Banque Nationale de
Paris, Dresdner Bank AG, New York and Grand Caymen Branches, Export Development
Corporation, Fleet National Bank, Royal Bank of Canada, The Bank of Nova Scotia,
Bank One, N.A., U.S. Bank National Association, and Westdeutsche Landesbank
Girozentrale, New York Branch.
"Mandatory Borrowing" has the meaning ascribed thereto in Section 2.02(h)
hereof.
"Material Adverse Change" means any circumstance or event that (a) is
material and adverse to the financial condition, business, results of operations
or Properties of the Borrower and the Restricted Subsidiaries taken as a whole,
(b) materially and adversely affects the validity or enforceability of any
Material Loan Document or (c) causes an Event of Default.
"Material Adverse Effect" means any circumstance or event that (a)
materially and adversely affects the financial condition, business, results of
operations or Properties of the Borrower and the Restricted Subsidiaries taken
as a whole or (b) materially and adversely affects the validity or
enforceability of any Material Loan Document.
"Material Licenses" means those Licenses of the Borrower and its Restricted
Subsidiaries (whether FCC, PUC or otherwise) without which a Substantial Portion
of the Backbone will not be permitted to operate. For purposes of this
definition of "Material Licenses", "Substantial Portion" means any portion of
the Backbone the failure of which to operate will have the effect of reducing
Operating Cash Flow for the Borrower and its Original Restricted Subsidiaries by
more than ten percent (determined by the most recently completed 12 month
period).
"Material Loan Document" means any of this Agreement, each Note, the
Conditional Early Release Unlimited Guaranty, each Fee Letter, each Assignment
and Acceptance, each Application, each Letter of Credit, each Interest Rate
Protection Agreement entered into between any Lender or any Bank Affiliate and
the Borrower or any Restricted Subsidiary, and any other written agreement
executed by and among the Borrower or any Restricted Subsidiary and the
Administrative Agent and/or the Lenders and/or the Bank Affiliates, in each case
in connection with this Agreement and the other Loan Papers from time to time
during the term of this Agreement, as each may be amended, modified,
substituted, replaced or extended from time to time.
"Maturity Date" means the earlier of March 31, 2004, or such earlier date
on which the total amount of outstanding Obligations are due and payable
(including, without limitation, whether by acceleration, scheduled reduction of
the Commitment to zero, mandatory or voluntary commitment reduction of the
Commitment to zero, installment payments or otherwise) and after which the
Commitments have been reduced to zero.
"Maximum Amount" means the maximum amount of interest which, under
Applicable Law, a Lender is permitted to charge on the Obligations.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which the Borrower, any Original Restricted Subsidiary
of the Borrower, or any ERISA
16
<PAGE>
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, such plan being maintained pursuant to one or more
collective bargaining agreements.
"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, any Original Restricted Subsidiary of the Borrower, or any ERISA
Affiliate and at least one Person other than the Borrower, any Original
Restricted Subsidiary of the Borrower and any ERISA Affiliate, or (b) was so
maintained and in respect of which the Borrower, any Original Restricted
Subsidiary of 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 Proceeds" means the gross cash proceeds received by the Borrower or
any Restricted Subsidiary in connection with, or as a result of, any Disposition
of any asset that is not a Permitted Asset Sale, minus (so long as each of the
following are estimated in good faith and certified to the Administrative Agent
in reasonable detail by an Authorized Officer) (a) actual taxes (estimated in
good faith by not less than three Responsible Officers) incurred as a result of
such Disposition (after giving effect to all tax benefits available to the
Borrower or such Restricted Subsidiary), (b) reasonable and customary
transaction costs paid or payable by the Borrower or any Restricted Subsidiary
that are related to such Disposition and payable to a Person other than an
Unrestricted Subsidiary or an Affiliate of the Borrower and its Subsidiaries,
and (c) any principal, interest, fees, expenses and other amounts paid or
payable within 30 days after the Disposition of any such assets in connection
with the repayment of indebtedness owed to a third Person that is not an
Affiliate of the Borrower or an Unrestricted Subsidiary, which such indebtedness
is secured by Liens on such assets to the extent such Liens are permitted by
Section 8.02(g), Section 8.02(h) or not prohibited by Section 8.03 hereof.
"New Credit Facility" means that certain credit facility in the amount of
$1,000,000,000 (which could under certain circumstances increase to
$2,000,000,000) available to the Borrower in accordance with the terms of the
New Credit Facility Documentation.
"New Credit Facility Documentation" means that certain Credit Agreement,
dated as of March 9, 2000, in the amount of $1,000,000,000 (which could under
certain circumstances increase to $2,000,000,000), among the Borrower, Bank of
America, N.A. as Administrative Agent and the other lenders defined therein and
all other agreements and documentation relating to the New Credit Facility, as
amended from time to time.
"Notes" means each of the Revolver A Notes, Working Line Notes, Revolver B
Notes and the Swingline Note, and "Note" means any of the Revolver A Note, the
Working Line Note, the Revolver B Note or the Swingline Note, as applicable in
the context used, and in each case, with any extension, renewal or amendment
thereof, or substitution therefor (in accordance with Sections 2.16, 11.04 or
otherwise).
"Notice of Change of Senior Unsecured Debt Rating" means that certain
Notice of Change in the Senior Unsecured Debt Rating in the form of Exhibit J
---------
hereto.
"Obligations" means all present and future obligations, indebtedness and
liabilities, and all renewals and extensions of all or any part thereof, of the
Borrower and each other Obligor or
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Restricted Subsidiary to Lenders, Administrative Agent arising from, by virtue
of, or pursuant to this Agreement, any of the other Loan Papers and any and all
renewals and extensions thereof or any part thereof, or future amendments
thereto, all interest accruing on all or any part thereof and reasonable
attorneys' fees incurred by the Administrative Agent and Arranging Agents for
the preparation of this Agreement and consummation of this credit facility,
execution of waivers, amendments and consents, and in connection with the
enforcement or the collection of all or any part thereof, and reasonable
attorneys' fees incurred by the Lenders or any Bank Affiliate in connection with
the enforcement or the collection of all or any part of the Obligations during
the continuance of an Event of Default, in each case whether such obligations,
indebtedness and liabilities are direct, indirect, fixed, contingent, joint,
several or joint and several, provided that the definition of
-------------
Obligations as used in this Agreement shall specifically include (i) all amounts
owed by any Obligor or any Restricted Subsidiary pursuant to the terms of any
Interest Rate Protection Agreement entered into by the Borrower or such
Restricted Subsidiary with the Administrative Agent, any Lender or any Bank
Affiliate, plus (ii) all amounts owed any Bank Affiliate in accordance with the
terms of Section 2.14 hereof or 2.17 hereof. Without limiting the generality of
the foregoing, "Obligations" includes all amounts which would be owed by the
Borrower, each other Obligor or Restricted Subsidiary and any other Person
(other than Administrative Agent or Lenders) to Administrative Agent, Lenders or
any Bank Affiliate under any Loan Paper, 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, any other Obligor,
any Restricted Subsidiary or any other Person (including all such amounts which
would become due or would be secured but for the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding of the Borrower, any other Obligor, any Restricted Subsidiary or any
other Person under any Debtor Relief Law).
"Obligor" means (a) the Borrower, (b) the Guarantor so long as such
Guarantor is obligated under the Conditional Early Release Unlimited Guaranty,
(c) each other Person liable for performance of any of the Obligations and (d)
each other Person the Property of which secures the performance of any of the
Obligations.
"Offering Memorandum" means that certain Confidential Offering Memorandum
dated February 2000 prepared in connection with the syndication of the Loans.
"Operating Cash Flow" means, for the Borrower and the Restricted
Subsidiaries, for any period, the consolidated net income (loss) for such period
taken as a single accounting period, plus the sum of the following amounts for
such period to the extent included in the determination of such consolidated net
income or loss, without duplication: (a) depreciation expense, (b) amortization
expense and other non-cash charges, expenses or losses reducing income, (c)
Interest Expense, (d) Income Tax Expense and (e) extraordinary losses, minus the
sum of (i) extraordinary gains and (ii) non-cash income.
"Option Date" means, with respect to the Working Line Loan only, March 9,
2000.
"Original Borrower" means the Borrower as it existed immediately prior to
the U S WEST Acquisition.
"Original Closing Date" means March 31, 1999.
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<PAGE>
"Original Credit Agreement" means that certain Credit Agreement, dated as
of March 31, 1999, among Qwest Communications International Inc., a Delaware
corporation (the "Borrower"), the Lenders (as defined therein), Bank of America,
N.A. (formerly NationsBank, N.A.). as a Lender and administrative agent, Banc of
America Securities LLC (formerly NationsBanc Montgomery Securities LLC), as lead
arranger and sole book running manager, First Union Securities, Inc. (formerly
First Union Capital Markets Corp.), BNY Capital Markets, Inc. and Salomon Smith
Barney Inc. as co-arrangers, First Union Securities, Inc. (formerly First Union
Capital Markets Corp.), The Bank of New York and Salomon Smith Barney Inc. as
co-syndication Agents and Bank of America, N.A. (formerly NationsBank, N.A.),
The Bank of New York, First Union National Bank and CitiBank N.A. as arranging
agents, the managing agents and the Lenders (as defined therein).
"Original Restricted Subsidiary" means any Restricted Subsidiary that is
not a U S WEST Company.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
agency or entity performing substantially the same functions.
"Permitted Acquisition" means acquisitions made by the Borrower or any
Original Restricted Subsidiary of (a) assets (except Capital Stock) used in the
Telecommunications Business, including, without limitation, the internet,
internet protocol, web hosting and electronic commerce or (b) the Capital Stock
of a Person operating in the Telecommunications Business, including, without
limitation, the internet, internet protocol, web hosting and electronic
commerce, so long as any such Person becomes a Wholly Owned Restricted
Subsidiary.
"Permitted Asset Sales" means (a) Dispositions of assets in the ordinary
course of business and in accordance with the Borrower's past practices and (b)
Dispositions of equipment that is worn out, obsolete, damaged or otherwise
unsuitable for use in the business.
"Permitted Investments" means, (a) so long as U S WEST has a Senior
Unsecured Debt Rating of BBB- or Baa3 or higher immediately prior to the
consummation of such acquisition, the U S WEST Acquisition and (b) cash and non-
cash Investments made after November 29, 1999 (which such Investments are not
otherwise permitted by subsections (a) through (f), or (h) through (n) of
Section 8.04 hereof), the sum of which in the aggregate for the Borrower and the
Restricted Subsidiaries under this definition does not exceed at any time
outstanding, $1,000,000,000. Notwithstanding the foregoing, to the extent and
at the time that any series of Investments permitted under Section 8.04 hereof
constitutes an acquisition of the Capital Stock of a Person that becomes a
Wholly Owned Restricted Subsidiary that is also permitted by the terms of
Section 8.18 hereof or is acquired by a U S WEST Restricted Subsidiary, such
series of Investments shall no longer be included as an Investment in
determining the outstanding Investments for inclusion in the basket set forth
above.
"Permitted Liens" means, as applied to any Person:
(a) any Lien in favor of the Lenders to secure the Obligations hereunder;
(b) (i) Liens on real estate for real estate Taxes not yet delinquent or
claims being diligently contested in good faith, (ii) Liens created by lease
agreements, licenses or similar interests, or by statute or common law to secure
the payments of rental, license amounts or similar amounts
19
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and other sums not yet due thereunder, (iii) Liens on leasehold interests,
licenses or similar interests created by the lessor, licensee or grantor
thereunder in favor of any mortgagee of the leased premises, and (iv) Liens for
Taxes, assessments, governmental charges, levies or claims that are not yet
delinquent or remain payable without penalty or are being diligently contested
in good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on such Person's books, but only
so long as no foreclosure, restraint, sale or similar proceedings have been
commenced with respect thereto;
(c) Liens of carriers, warehousemen, mechanics, laborers and materialmen
and other similar Liens incurred in the ordinary course of business for sums not
yet due or being contested in good faith, if such reserve or appropriate
provision, if any, as shall be required by GAAP shall have been made therefor,
and in addition to the foregoing, Liens of carriers, warehousemen, mechanics,
laborers and materialmen and other similar Liens incurred in the ordinary course
of business that in the aggregate do not secure liabilities in excess of
$10,000,000 outstanding at any one time;
(d) Liens incurred in the ordinary course of business in connection with
worker's compensation, unemployment insurance or similar legislation;
(e) Easements, right-of-way, zoning restrictions, servitudes, matters of
public record, restrictions and other similar encumbrances on the use of real
property which do not materially interfere with the ordinary conduct of the
business of such Person as being conducted;
(f) Liens in respect of judgments or awards for which appeals or
proceedings for review are being prosecuted and in respect of which a stay of
execution upon any such appeal or proceeding for review shall have been secured,
provided that (i) such Person shall have established adequate reserves for such
-------------
judgments or awards, (ii) such judgments or awards shall be fully insured
(subject to deductibles) and the insurer shall not have denied coverage, or
(iii) such judgments or awards shall have been bonded to the satisfaction of the
Majority Lenders;
(g) Any Liens existing on the Original Closing Date which are described on
Schedule 8.03 hereto and not otherwise described elsewhere in the definition of
-------------
Permitted Liens, and Liens resulting from the permitted refinancing of the
related Debt for Borrowed Money of the Borrower and its Restricted Subsidiaries,
provided that the Debt for Borrowed Money of the Borrower and its Restricted
-------------
Subsidiaries secured thereby shall not be increased and the Liens shall not
cover additional assets of the Borrower or any such Restricted Subsidiary;
(h) Liens, deposits, or pledges to secure the performance of bids, tenders,
contracts (other than contracts for the payment of money), leases, public or
statutory obligations, surety, stay appeal, indemnity, performance or other
similar bonds, or other similar obligations arising in the ordinary course of
business;
(i) Liens arising solely by virtue of any statutory or common law provision
relating to banker's liens, rights of set-off or similar rights and remedies as
to deposit accounts or other funds maintained with a creditor or deposit
accounts or other funds maintained with a creditor depository institution;
provided that (i) such deposit account is not a dedicated cash collateral
-------------
account and is not subject to restrictions against access by the Borrower in
excess of those set forth by regulations promulgated by the Board of Governors
of the Federal Reserve System or any governmental
20
<PAGE>
authority succeeding to any of its principal functions, and (ii) such deposit
account is not intended by the Borrower to provide collateral to the depository
institution; and
(j) any UCC-1 or UCC-3 filing against the Borrower or any Restricted
Subsidiary (i) which were filed in connection with Debt which has been repaid in
full and extinguished, (ii) with respect to which an Authorized Officer of the
Borrower or such Restricted Subsidiary has not had actual knowledge of their
existence for more than 30 days, (iii) with respect to which any commitment,
obligation or liability of the Borrower or any such Restricted Subsidiary and
any such lender or creditor has been terminated and (iv) with respect to which
all documentation creating any lien, hypothecation or security interest related
to such UCC filing has been terminated whether pursuant to its terms or
otherwise.
"Permitted Refinancing Indebtedness" means Debt of the applicable Obligor
or Original Restricted Subsidiary to the extent all of the net proceeds thereof
are used to refinance Debt of such Obligor or Original Restricted Subsidiary,
provided that after giving effect to the incurrence of such Debt, the Borrower
-------------
is in pro forma compliance with the terms of this Agreement, and provided
further that (i) the material terms of such new Debt are no more restrictive
than the Existing Financing Documentation (including, without limitation, the
maturity, financial covenants and restrictive covenants), (ii) the maturity of
such new Debt is no shorter than the Debt being refinanced, (iii) the priority
of any such new Debt shall remain unchanged (if such Debt to be refinanced is
Subordinated Indebtedness, the subordination provisions shall remain
substantially unchanged in the new refinanced Debt) and (iv) other than with
respect to the LCI Notes in which case the Borrower may become obligated on such
LCI Notes and the Guarantor may be released, the parties obligated on (or with
respect to) such Debt remain the same.
"Person" means an individual, partnership, joint venture, corporation,
limited liability company, trust, Tribunal, unincorporated organization, and
government, or any department, agency, or political subdivision thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Preferred Stock", as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which is preferred as
to the payment of dividends or distributions, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over shares of Capital Stock of any other class of such Person.
"Prohibited Transaction" has the meaning specified in Section 4975 of the
Code or Section 406 of Title I of ERISA.
"Property" means all types of real, personal, tangible, intangible, or
mixed property, whether owned or hereafter acquired in fee simple or leased by
the Borrower and the Restricted Subsidiaries.
"PUC" means any state regulatory agency or body that exercises jurisdiction
over the rates or services or the ownership, construction or operation of any
long distance network facility or telecommunications systems or over Persons who
own, construct or operate a long distance network facility or telecommunications
systems, in each case by reason of the nature or type of the business subject to
regulation and not pursuant to laws and regulations of general applicability to
Persons conducting business in such state.
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<PAGE>
"Quarterly Date" means the last Business Day of each March, June, September
and December during the term of this Agreement.
"Qwest Material Subsidiary" means on any date of determination, any
Original Restricted Subsidiary that generated in the most recently completed 12
month period in excess of 10% of the Operating Cash Flow of the Original
Borrower and its Original Restricted Subsidiaries, and "Qwest Material
Subsidiaries" means the smallest group of one or more Original Restricted
Subsidiaries which in the aggregate generated in the most recently completed 12
month period not less than 80% of the Operating Cash Flow of the Original
Borrower and its Original Restricted Subsidiaries.
"Qwest 8.29% Senior Discount Notes" means those certain 8.29% Senior
Discount Notes Due 2008 issued by the Borrower.
"Qwest 8.29% Senior Discount Notes Documentation" means that certain
Indenture dated January 29, 1998 related to the Qwest 8.29% Senior Discount
Notes and all other agreements and documentation relating to the Qwest 8.29%
Senior Discount Notes.
"Qwest 9.47% Senior Discount Notes" means those certain 9.47% Senior
Discount Notes Due 2007 issued by the Borrower.
"Qwest 9.47% Senior Discount Notes Documentation" means that certain
Indenture dated October 15, 1997 related to the Qwest 9.47% Senior Discount
Notes and all other agreements and documentation relating to the Qwest 9.47%
Senior Discount Notes.
"Qwest 7.50% Senior Notes" means those certain 7.50% Senior Notes Due 2008
issued by the Borrower.
"Qwest 7.50% Senior Notes Documentation" means that certain Indenture dated
November 4, 1998 related to the Qwest 7.50% Senior Notes and all other
agreements and documentation relating to the Qwest 7.50% Senior Notes.
"Qwest 10.875% Senior Notes" means those certain 10.875% Senior Notes Due
2007 issued by the Borrower.
"Qwest 10.875% Senior Notes Documentation" means that certain Indenture
dated August 28, 1997 related to the Qwest 10.875% Senior Notes and all other
agreements and documentation relating to the Qwest 10.875% Senior Notes.
"Qwest 7.25% Senior Notes" means those certain 7.25% Senior Notes Due 2008
issued by the Borrower.
"Qwest 7.25% Senior Notes Documentation" means that certain Indenture dated
November 27, 1998 related to the Qwest 7.25% Senior Notes and all other
agreements and documentation relating to the Qwest 7.25% Senior Notes.
22
<PAGE>
"Refinancing Advance" means any Advance which is used to pay the principal
amount (or any portion thereof) of an Advance at the end of its Interest Period
and which, after giving effect to such application, does not result in an
increase in the aggregate amount of outstanding Advances.
"Release Date" means the date on which the Notes have been paid, all other
Obligations due and owing have been paid and performed in full, and the
Commitment has been terminated.
"Repayment Event" means (a) with respect to Debt for Borrowed Money of the
Borrower and the Original Restricted Subsidiaries, any event or circumstance
which meets any of the following criteria: (i) causes any mandatory redemption,
prepayment or other repayment in full (excluding any scheduled repayments) of
any Debt for Borrowed Money of the Borrower and its Original Restricted
Subsidiaries or (ii) permits the holders of any Debt for Borrowed Money of the
Borrower and its Original Restricted Subsidiaries to redeem in full, to demand
the prepayment or repayment in full of such Debt for Borrowed Money and (b) with
respect to Debt for Borrowed Money of the U S WEST Restricted Subsidiaries, any
event or circumstance which meets any of the following criteria: (i) causes any
mandatory redemption, prepayment or other repayment in full (excluding any
scheduled repayments) of any Debt for Borrowed Money of any U S WEST Restricted
Subsidiary or (ii) permits the holders of any Debt for Borrowed Money of any U S
WEST Restricted Subsidiary to redeem in full, to demand the prepayment or
repayment in full of any such Debt for Borrowed Money.
"Responsible Officer" means with respect to the Borrower and its Restricted
Subsidiaries respectively, any Authorized Officer, any Executive Vice President
and any Senior Vice President.
"Restricted Payments" means, for the Borrower and the Restricted
Subsidiaries of the Borrower, (a) any direct or indirect Distribution, dividend
or other payment on account of any equity interest in, or shares of, Capital
Stock or other securities, of the Borrower and its Restricted Subsidiaries (or
the establishment of any sinking fund or otherwise the setting aside of any
funds with respect thereto), except such dividends that are paid with common
equity securities of the Borrower; (b) any management, consulting or other
similar fees, or any interest thereon, payable by the Borrower or any of the
Restricted Subsidiaries to any Unrestricted Subsidiary and/or any other
Affiliate of the Borrower other than a Wholly Owned Restricted Subsidiary (or
the establishment of any sinking fund or otherwise the setting aside of any
funds with respect thereto), but specifically excluding any consulting fees
payable by the Borrower or any Restricted Subsidiary to a Person that is not an
Unrestricted Subsidiary or an Affiliate of the Borrower, (c) loans or advances
to employees and/or shareholders of the Borrower and the Subsidiaries of the
Borrower; (d) payments of principal and/or interest, or the setting aside of
funds with respect thereto, of any Total Debt except the Obligations; (e)
dividends, distributions, redemptions, repurchases or defeasance of any
preferred stock issuance (or the setting aside of any funds to do so); and (f)
payments of any amounts, fees, advances, loans, investments or otherwise to any
Unrestricted Subsidiary, except Permitted Investments, except that payments by
the Borrower in lieu of the issuance of fractional shares as a result of the U S
WEST Acquisition shall not constitute a Restricted Payment.
"Restricted Subsidiary" means, as of any date of determination, all those
Subsidiaries of the Borrower that are not Unrestricted Subsidiaries, provided
--------
that, notwithstanding the foregoing, (a) all Subsidiaries designated by the
----
Borrower as Restricted Subsidiaries on the Original Closing Date shall remain
Restricted Subsidiaries until the earlier of either (i) the Obligations being
repaid in full and the Commitments terminated or (ii) the re-designation of such
Restricted Subsidiary by the
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Borrower with the written approval of Majority Lenders, and (b) this definition
shall, after the Acquisition Date but subject to Section 9.08 hereof, include
all U S WEST Restricted Subsidiaries.
"Revolver A Advance" means any advance made under the Revolver A Loan.
"Revolver A Commitment" means, with respect to the Revolver A Loan,
$250,000,000, as reduced from time to time pursuant to Section 2.11 hereof.
"Revolver A Commitment Fee" means the fee described in Section 2.10(a)(i)
hereof.
"Revolver A Loan" means the loan made by Lenders pursuant to Section
2.01(a) of this Agreement.
"Revolver A Note" means each Note of the Borrower evidencing Revolver A
Advances under the Revolver A Loan hereunder, substantially in the form of
Exhibit A hereto, together in each case, with any extension, renewal or
---------
amendment thereof, or substitution therefor.
"Revolver A Specified Percentage" means, as to any Lender, the percentage
indicated beside its name on the signature pages hereof designated as its
Revolver A Specified Percentage, or as adjusted or specified (i) in any
Assignment and Acceptance or (ii) in any amendment to this Agreement.
"Revolver B Advance" means any advance made under the Revolver B Loan.
"Revolver B Commitment" means, with respect to the Revolver B Loan,
$250,000,000, as reduced from time to time pursuant to Section 2.11 hereof.
"Revolver B Commitment Fee" means the fee described in Section 2.10(a)(iii)
hereof.
"Revolver B Loan" means the loan made by Lenders pursuant to Section
2.01(c) of this Agreement.
"Revolver B Note" means each Note of the Borrower evidencing Revolver B
Advances hereunder, substantially in the form of Exhibit C hereto, together in
---------
each case, with any extension, renewal or amendment thereof, or substitution
therefor.
"Revolver B Specified Percentage" means, as to any Lender, the percentage
indicated beside its name on the signature pages hereof designated as its
Revolver B Specified Percentage, or as adjusted or specified (i) in any
Assignment and Acceptance or (ii) in any amendment to this Agreement.
"Rights" means rights, remedies, powers, and privileges.
"Senior Unsecured Debt Rating" means the Borrower's senior unsecured debt
rating as announced by Standard & Poor's Ratings Group, a Division of McGraw-
Hill, Inc. or Moody's Investors Service, Inc.
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<PAGE>
"Single Employer Plan" means a single employer plan, as defined in Section
4001(a)(15) of ERISA, that is maintained for employees of the Borrower, any
Original Restricted Subsidiary or any ERISA Affiliate, other than a Multiple
Employer Plan of the Borrower.
"Sole Book Running Manager" means Banc of America Securities LLC.
"Solvent" means, as of any date of determination, with respect to any
Person, that on such date such Person is not "insolvent" (as that term is
defined in section 101 of the Bankruptcy Reform Act of 1978, as amended from
time to time and any successor statute), (b) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such Person's
ability to pay as such debts and liabilities mature, and (c) such Person is not
engaged in business or a transaction, and is not about to engage in business or
a transaction, for which such Person's Property would constitute an unreasonably
small capital.
"Special Counsel" means the law firm of Donohoe, Jameson & Carroll, P.C.,
or such other individual or firm acting as special counsel to Administrative
Agent, as designated by Administrative Agent from time to time.
"Specified Change of Control" means the occurrence of either of the
following events: (a) with respect to Debt for Borrowed Money of the Borrower
and the Original Subsidiaries, any event which constitutes any "change of
control" or "change in control" as defined in (i) any of the Existing Financing
Documentation or (ii) any other instrument evidencing any then outstanding and
unpaid Debt for Borrowed Money of the Borrower and the Original Restricted
Subsidiaries in excess of $25,000,000, or (b) with respect to Debt for Borrowed
Money of the U S WEST Restricted Subsidiaries, any event which constitutes any
"change of control" or "change in control" as defined in any of the U S WEST
Financing Documentation evidencing any then outstanding and unpaid Debt for
Borrowed Money of the U S WEST Restricted Subsidiaries in excess of
$100,000,000.
"Subordinated Indebtedness" means Debt of the Borrower that is unsecured
and subordinated to the Obligations, such Debt in each case (a) to be pursuant
to the terms and conditions set forth on Schedule 1.01 hereto and (b) to be
-------------
pursuant to documentation containing material terms and conditions no more
onerous or restrictive than this Agreement and the Material Loan Documents.
"Subsidiary" of any Person means any corporation, limited liability
company, partnership, joint venture, trust or estate of which (or in which) more
than 50% of:
(a) the outstanding Capital Stock having 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 partnership or
joint venture, or
(c) the beneficial interest of such trust or estate,
is at the time directly or indirectly owned by such Person, by such Person and
one or more of its Subsidiaries or by one or more of such Person's Subsidiaries.
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<PAGE>
"SuperMajority Lenders" means any combination of Lenders having at least
66.67% of the aggregate amount of Advances under this Agreement; provided,
however, that if no Advances are outstanding under this Agreement, such term
means any combination of Lenders having Total Specified Percentages equal to at
least 66.67% of the aggregate Commitment.
"Swingline Advance" means an Advance made pursuant to Section 2.01(a)(ii)
hereof.
"Swingline Bank" means Bank of America, N.A. and any successor thereto
appointed in accordance with Section 10.06 hereof.
"Swingline Commitment" means the lesser of (a) $25,000,000 and (b) the
Revolver A Commitment minus the sum of (i) all outstanding Swingline Advances,
plus (ii) all outstanding Revolver A Advances, plus (iii) the outstanding face
amount of all Letters of Credit, plus (iv) without duplication, all
reimbursement obligations owed under Article III hereof.
"Swingline Facility" means that certain swingline facility available to the
Borrower in accordance with the terms of Section 2.01(a)(ii) hereof.
"Swingline Loans" means the loans made under the Swingline Facility from
time to time.
"Swingline Note" means the Swingline Note of the Borrower payable to the
order of the Swingline Bank, evidencing Swingline Advances hereunder,
substantially in the form of Exhibit D hereto, together with any extension,
renewal or amendment thereof or substitution therefor.
"Tangible Assets" means, with respect to any Person on any date of
determination, the tangible assets of such Person and the tangible assets of the
specified Subsidiaries of such Person, in each case determined in accordance
with GAAP on such date.
"Taxes" means all taxes, assessments, imposts, fees, or other charges at
any time imposed by any Laws or Tribunal.
"Telecommunications Business" means the business of (i) transmitting, or
providing services relating to the transmission of, voice, data or video through
owned or leased transmission facilities, (ii) constructing, creating, developing
or marketing communications related network equipment, software and other
devices for use in a telecommunications business, or (iii) evaluating,
participating in or pursuing any other activity or opportunity that is primarily
related to those identified in (i) or (ii) above, provided that the
-------------
determination of what constitutes a telecommunications business under this
definition shall be made in good faith by the Board of Directors.
"Total Debt" means all Debt for Borrowed Money of the Borrower and its
Restricted Subsidiaries which would be shown on a consolidated balance sheet in
accordance with GAAP, including, without limitation for the Borrower and the
Restricted Subsidiaries, (a) Capital Lease obligations, (b) Debt of any other
Person secured by a Lien on the property of the Borrower or any Restricted
Subsidiary in an amount equal to the lesser of (i) such Debt of such Person and
(ii) the value of such pledged property, (c) Contingent Liabilities to the
extent any such Contingent Liabilities constitute Debt for Borrowed Money of the
Borrower and its Restricted Subsidiaries, (d) Withdrawal Liability and (e)
overdue interest on any Debt for Borrowed Money of the Borrower and its
Restricted Subsidiaries (but not accrued interest that is not overdue).
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"Total Leverage Ratio" means, on any date of determination, the ratio of
(a) Total Debt on such date to (b) Annualized Operating Cash Flow, provided that
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(i) the calculation of Total Debt for purposes of the Total Leverage Ratio will
be net of the sum of any cash balances in excess of $10,000,000 and (ii) for
purposes of this calculation, Operating Cash Flow shall be calculated as if all
assets (including the acquisition of Capital Stock of Restricted Subsidiaries)
acquired on any date during the period of determination were acquired on the
first day in such period of determination, and all assets (including the
acquisition of Capital Stock of Restricted Subsidiaries) sold on any date during
the period of determination were sold on the first day in such period of
determination.
"Total Specified Percentage" means, as to any Lender on any date of
determination, the percentage that such Lender's outstanding Advances (all
Revolver A Advances, Revolver B Advances and Working Line Advances) bears to the
aggregate outstanding amount of Advances (all Revolver A Advances, Revolver B
Advances and Working Line Advances) made by all Lenders hereunder, provided
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that, if there are no outstanding Advances hereunder, "Total Specified
Percentage" shall mean for such Lender the percentage that the sum of its (a)
Revolver A Specified Percentage of the Revolver A Commitment plus (b) Revolver B
Specified Percentage of the Revolver B Commitment, plus (c) Working Line
Specified Percentage of the Working Line Commitment bears to the aggregate
Commitments of all Lenders on such date.
"Tribunal" means any state, commonwealth, federal, foreign, territorial, or
other court or government body, subdivision, agency, department, commission,
board, bureau, or instrumentality of a governmental body.
"TROL Transaction" means that certain synthetic lease transaction pursuant
to the TROL Transaction Documentation.
"TROL Transaction Documentation" means that certain (1) Trust Agreement,
dated as of November 15, 1996, between Bank of America, N.A. (formerly
NationsBank, N.A., successor by merger to NationsBank of Texas, N.A.), The
Industrial Bank of Japan, Ltd., The Bank of New York, The Bank of Nova Scotia,
PNC Leasing Corp. and Bank One, N.A. (formerly The First National Bank of
Chicago) each as holders, and First Security Bank, National Association, as the
Owner Trust, (2) that certain Participation Agreement, dated as of November 15,
1996, among LCI, as the Construction Agent and as the Lessee, First Security
Bank, National Association, as the Owner Trustee, the various banks and lending
institutions which are parties thereto as holders, the various banks and lending
institutions which are parties thereto from time to time, as the lenders and
Bank of America, N.A. (formerly NationsBank, N.A.) as the agent for the lenders,
(3) that certain Credit Agreement dated as of November 15, 1996 among First
Security Bank, National Association, as the owner trustee as the borrower the
several lenders from time to time party thereto and Bank of America, N.A.
(formerly NationsBank, N.A.), as the agent, (4) those certain Tranche A Notes,
each dated as of November 15, 1996, payable to the order of Bank of America,
N.A. (formerly NationsBank, N.A.), The Industrial Bank of Japan, Ltd., The Bank
of New York, The Bank of Nova Scotia, Bank One,
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N.A. (formerly The First National Bank of Chicago) and PNC Leasing Corp.,
respectively, (5) that certain Unconditional Guaranty Agreement dated as of
November 15, 1996 made by LCI as guarantor in favor of Bank of America, N.A.
(formerly NationsBank, N.A.), as agent for the ratable benefit of the Tranche A
lenders, (6) those certain Tranche B Notes, each dated as of November 15, 1996,
payable to the order of Bank of America, N.A. (formerly NationsBank, N.A.), The
Industrial Bank of Japan, Ltd., The Bank of New York, The Bank of Nova Scotia,
Bank One, N.A. (formerly The First National Bank of Chicago) and PNC Leasing
Corp., respectively, and (7) all such other documents, receipts, deeds of trust,
security agreements and other agreements and certificates (including, without
limitation, certificates of trust) executed in connection with the foregoing
agreements, in each case as each such agreement, receipt or other document or
certificate has been or shall be amended, extended, waived or modified from time
to time as permitted by the terms of this Agreement.
"Type" refers to the distinction between Advances bearing interest at the
Base Rate and LIBOR Rate.
"UCC" means the Uniform Commercial Code as adopted in the State of New
York.
"Unrestricted Subsidiary" means those Subsidiaries of the Borrower that are
designated in writing to the Administrative Agent and each Lender by the
Borrower as Unrestricted Subsidiaries and all U S WEST Unrestricted
Subsidiaries, provided that no Restricted Subsidiary existing on the Original
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Closing Date may be designated as an Unrestricted Subsidiary without the prior
written consent of Majority Lenders. Each newly formed or acquired Unrestricted
Subsidiary shall be effective as of the date of formation or acquisition,
respectively.
"U S WEST" means U S WEST, Inc., a Delaware corporation.
"U S WEST Acquisition" means that certain acquisition and merger by the
Borrower of U S WEST in accordance with the terms of that certain Agreement and
Plan of Merger, dated as of July 18, 1999 between the Borrower and U S WEST, as
such agreement may be amended, modified, renewed or extended from time to time.
"U S WEST Company" means any of U S WEST and its Subsidiaries.
"U S WEST Debt" means all outstanding and unpaid Debt for Borrowed Money of
U S WEST and the U S WEST Restricted Subsidiaries from time to time, and any
permitted refinancings, extensions, modifications and renewals thereof,
provided that, except for the U S WEST Guarantees, in no event shall the
Borrower or any Original Restricted Subsidiary be obligated on such Debt for
Borrowed Money.
"U S WEST Default" means any breach, default, event of default or failure
to comply, under or as defined in, any of the U S WEST Financing Documentation,
in each case only so long as such breach, default, event of default or such
failure shall continue after the applicable grace period and either (i) permits
the holders thereof to accelerate such Debt evidenced thereby in a principal
amount then outstanding and unpaid in excess of $100,000,000, or (ii) results in
a Repayment Event with respect to Debt evidenced thereby in a principal amount
then outstanding and unpaid in excess of $100,000,000.
"U S WEST Financing Documentation" means all agreements, instruments and
other documentation evidencing and/or in connection with all U S WEST Debt, as
such agreements, instruments and other documentation may be amended, modified,
waived, refinanced, replaced, renewed or extended from time to time.
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"U S WEST Guarantees" means all Guaranties of Debt of the U S WEST
Restricted Subsidiaries executed by U S WEST, as each such Guarantee may be
amended, modified, renewed or extended from time to time. To the actual
knowledge of an Authorized Officer, all U S WEST Guarantees in effect on the
Amendment and Restatement Closing Date are listed on Schedule 1.03 hereto.
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"U S WEST Permitted Refinancing Indebtedness" means Debt of a U S WEST
Restricted Subsidiary to the extent all of the net proceeds thereof are used to
refinance U S WEST Debt of a U S WEST Restricted Subsidiary, provided that after
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giving effect to the incurrence of such Debt, the Borrower is in pro forma
compliance with the terms of this Agreement, and provided further that (i) the
parties obligated on (or with respect to) such Debt do not include the Borrower
or any Original Restricted Subsidiary and (ii) the collateral and/or security
for such Debt does not include any Properties or assets of the Borrower or any
of the Original Restricted Subsidiaries.
"U S WEST Restricted Subsidiary" means, as of any date of determination
after the date of the U S WEST Acquisition, U S WEST and all the Subsidiaries of
U S WEST that are not U S WEST Unrestricted Subsidiaries, provided that, on and
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after the Acquisition Date, the Designated U S WEST Restricted Subsidiary shall
remain a U S WEST Restricted Subsidiary until the earlier of either (i) the
Obligations being repaid in full and the Commitments terminated or (ii) the re-
designation of such U S WEST Restricted Subsidiary by the Borrower with the
written approval of Majority Lenders.
"U S WEST Unrestricted Subsidiary" means, those Subsidiaries of U S WEST
that are designated in writing to the Administrative Agent and each Lender by
the Borrower as U S WEST Unrestricted Subsidiaries from time to time, provided
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that the Designated U S WEST Restricted Subsidiary may not be designated as a U
----
S WEST Unrestricted Subsidiary without the prior written consent of Majority
Lenders. Each newly formed or acquired U S WEST Unrestricted Subsidiary shall
be effective as of the date of formation or acquisition, respectively.
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
"Waiver Period" means the period beginning the Acquisition Date and
continuing until the end of the Borrower's second full fiscal quarter that
commences after such date.
"Wholly Owned Restricted Subsidiary" means, as of any date of
determination, a Restricted Subsidiary that is owned 100%, directly or
indirectly, by the Borrower, provided that, with respect to foreign Subsidiaries
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of the Borrower, "Wholly Owned Restricted Subsidiary" shall also include those
foreign Subsidiaries of the Borrower that are 99% or above owned directly or
indirectly by the Borrower.
"Withdrawal Liability" has the meaning given such term under Part I of
Subtitle E of Title IV of ERISA.
"Working Line Advance" means any advance made under the Working Line Loan.
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"Working Line Commitment" means, with respect to the Working Line Loan
prior to the Conversion Date, $500,000,000, as reduced from time to time
pursuant to Section 2.11 and Section 2.16 hereof, or as increased in accordance
with the terms of Section 2.16 hereof, provided that, (a) on the Option Date, if
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the Borrower and the SuperMajority Lenders have not agreed to an Extension
Option or the Borrower has not exercised its Conversion Option in each case in
accordance with the terms of Section 2.16 hereof, the Working Line Commitment
shall mean $0.00 and (b) on and after the Extension Final Maturity, the Working
Line Commitment shall mean $0.00.
"Working Line Commitment Fee" means the fee described in Section
2.10(a)(ii) hereof.
"Working Line Loan" means the revolving 364 day short term revolving loan
made by the Lenders pursuant to Section 2.01(b) of this Agreement.
"Working Line Note" means each Note of the Borrower evidencing Working Line
Advances hereunder, substantially in the form of Exhibit B hereto with respect
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to Working Line Advances made under the Working Line Loan, together with any
extension, renewal or amendment thereof, or substitution therefor, and each note
evidencing the Working Line Loan after the Conversion Date, in accordance with
the terms of Section 2.16 hereof, together with any extension, renewal or
amendment thereof, or substitution therefor.
"Working Line Specified Percentage" means, as to any Lender, the percentage
indicated beside its name on the signature pages hereof designated as its
Working Line Specified Percentage, or as adjusted or specified (i) in accordance
with the terms of Section 2.16 hereof, (ii) in any Assignment and Acceptance or
(iii) in any amendment to this Agreement.
"Year 2000 Problem" means the risk that computer applications and devices
containing imbedded computer chips used by the Borrower or any of its
Subsidiaries (or their respective customers and vendors) may be unable to
recognize and perform properly date-sensitive functions involving certain dates
prior to and any date after December 31, 1999.
1.02. Accounting and Other Terms. All accounting terms used in this
Agreement which are not otherwise defined herein shall be construed in
accordance with GAAP on a consolidated basis for the Borrower and its
Subsidiaries, unless otherwise expressly stated herein (acknowledging that
excluding the Unrestricted Subsidiaries is not in accordance with GAAP).
References herein to one gender shall be deemed to include all other genders.
Except where the context otherwise requires, (a) definitions imparting the
singular shall include the plural and vice versa and (b) all references to time
are deemed to refer to New York time. In any calculation made hereunder,
including, without limitation, calculations made under Section 8.01 hereof, to
the extent that any such calculations are made in reliance upon financial
information supplied to the Administrative Agent and the Lenders in accordance
with the terms hereof and such information is later corrected or changed in any
manner (pursuant to an audited statement or otherwise), all such calculations
made in accordance with the terms hereof shall be changed and effective
retroactively as if the correct information had been delivered originally.
ARTICLE II. THE LOAN FACILITY
2.01. Loans.
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(a) Revolver A Loan.
(i) Revolver A Advances. Each Lender severally agrees, on the
terms and subject to the conditions hereinafter set forth, to make
Revolver A Advances to the Borrower on a Business Day during the
period from the Original Closing Date to the Maturity Date, in an
aggregate p