Amendment No. 2 to Credit Agreement among Williams Communications, Inc., Williams Communications Group, Inc., and Lenders

Contract Categories: Business Finance › Credit Agreements
Summary

This amendment, dated December 31, 1999, modifies the existing Credit Agreement between Williams Communications, Inc. (the borrower), Williams Communications Group, Inc. (as guarantor), several lenders, and Bank of America, N.A. (as administrative agent). The amendment updates definitions, allows new types of hedging transactions, adjusts rules for investments and asset sales, and revises financial covenants and leverage ratios. These changes affect how the borrower can manage investments, incur debt, and comply with financial limits under the credit facility.

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EX-10.60.2 3 ex10-60_2.txt AMENDMENT NO. 2 TO CREDIT AGREEMENT 1 EXHIBIT 10.60.2 [CONFORMED COPY] AMENDMENT NO. 2 TO CREDIT AGREEMENT AMENDMENT dated as of December 31, 1999 to the Credit Agreement dated as of September 8, 1999 (as amended, the "CREDIT AGREEMENT") among WILLIAMS COMMUNICATIONS, INC. (the "BORROWER"), WILLIAMS COMMUNICATIONS GROUP, INC., as Guarantor, the LENDERS party thereto (the "LENDERS") and BANK OF AMERICA, N.A., as Administrative Agent (the "ADMINISTRATIVE AGENT"), THE CHASE MANHATTAN BANK, as Syndication Agent, and BANK OF MONTREAL and THE BANK OF NEW YORK, as Co-Documentation Agents. WITNESSETH: WHEREAS, the parties hereto have entered into the Credit Agreement and now desire to make certain amendments to the Credit Agreement as set forth herein; NOW, THEREFORE, the parties hereto agree as follows: SECTION 1. Defined Terms; References. Unless otherwise specifically defined herein, each term used herein which is defined in the Credit Agreement has the meaning assigned to such term in the Credit Agreement. Each reference to "hereof", "hereunder", "herein" and "hereby" and each other similar reference and each reference to "this Agreement" and each other similar reference contained in the Credit Agreement shall, after this Amendment becomes effective, refer to the Credit Agreement as amended hereby. SECTION 2. Additional Definitions. (a) Section 1.01(a) of the Credit Agreement is hereby amended by inserting the following new defined terms in appropriate alphabetical order: "Permitted Specified Security Hedging Transactions" means options, collars, forwards and other similar transactions with respect to any Specified Security entered into by the Borrower or any of its Subsidiaries to hedge against changes in the market price of such Specified Security. "Specified Security" means publicly traded equity securities of actual or prospective customers or vendors of the Borrower and its Subsidiaries acquired by the Borrower and its Subsidiaries in connection with (or pursuant to warrants, options or rights acquired in connection with) commercial agreements with such customers or vendors; provided 2 that securities of the Borrower or any of its Subsidiaries or Affiliates shall not constitute Specified Securities. SECTION 3. Indebtedness; Certain Equity Securities. (a) Section 6.01 of the Credit Agreement is hereby amended by inserting, immediately following clause (p) thereof, new clause (q) to read in its entirety as follows: "(q) Permitted Specified Security Hedging Transactions;" SECTION 4. Liens. Section 6.02(a) of the Credit Agreement is hereby amended by (i) deleting the word "and" at the end of clause (vii) thereof, (ii) redesignating clause (viii) thereof as clause (ix) and (iii) inserting, immediately following clause (vii), a new clause (viii) to read in its entirety as follows: "(viii) Liens on a Specified Security securing Permitted Specified Security Hedging Transactions with respect to such Specified Security; and" SECTION 5. Fundamental Changes. Section 6.03(c) of the Credit Agreement is hereby amended by (i) adding, following the parenthetical expression "(a "Trading Subsidiary")" on the seventh line thereof, the expression "and (vi) the holding of Qualifying Borrower Indebtedness permitted under Section 6.01(q)" and (ii) adding, following the expression "Qualifying Equity Interests in the Borrower" on the ninth line thereof, the expression "Qualifying Borrower Indebtedness,". SECTION 6. Investments. (a) Section 6.04 of the Credit Agreement is hereby amended by (i) deleting the word "and" at the end of clause (p) thereof immediately following the words "Qualifying Equity Interests in Holdings;" (ii) redesignating clause (q) as clause (r), and (iii) inserting a new clause (q) to read in its entirety as follows: "(q) Investments made in any Person (a "REINVESTMENT PERSON") in whom the Borrower or any of its Subsidiaries has, or at any time after the Closing Date had, an Investment permitted under clause (b), (f) or (p) above or this clause (q) (an "ORIGINAL INVESTMENT"); provided that the aggregate amount of Investments in any Reinvestment Person permitted under this clause (q) may not exceed the aggregate amount of the cash proceeds received, within 270 days prior to the making of such Investment, by the Borrower and its Subsidiaries from sales or other dispositions of, or distributions with respect to, Original Investments in such Reinvestment Person; and" 2 3 (b) The proviso to Section 6.04 of the Credit Agreement is hereby amended and restated in its entirety as follows: "provided that the aggregate amount of all Investments (valued at the cost of acquisition thereof, without regard to any increase or decrease in the value thereof based on subsequent performance of the Person in which such Investment is held), but net, in case of each such Investment (but not below zero), of any distributions received by the Borrower or any Subsidiary Loan Party in respect of such Investment and any proceeds received upon any disposition (other than a disposition to Holdings or any of its Subsidiaries or the Parent or any of its Subsidiaries) of such Investment, made pursuant to Sections 6.04(j) and 6.04(k) on or prior to any date, or referred to in Section 6.04(c)(i), the proviso to Section 6.04(d) and Section 6.04(e)(ii) and made on or prior to such date, shall not exceed the sum of (i) $275,000,000 plus (ii) an amount (which amount, for purposes of this proviso only, shall not be less than zero) equal to (x) the amount of Additional Capital as of such date minus (y) (A) payments of principal of the Intercompany Note made pursuant to Section 6.07(b)(ii)(x) on or prior to such date, (B) acquisitions of ADP Property permitted under Section 6.04(g) made on or prior to such date and (C) Capital Expenditures permitted under Section 6.08(b) made on or prior to such date." (c) Schedule 6.04 to the Credit Agreement is hereby amended by inserting the following new paragraph 13 at the end thereof: "ChoiceSeat - WCG owns 1,180,667 shares of Series A Preferred Stock and 5,572,333 shares of common stock of CSI, Incorporated, for a total investment of about $27,000,000." SECTION 7. Asset Sales. Section 6.05(a) of the Credit Agreement is hereby amended by (i) inserting the phrase "sales of inventory" immediately following the word "capacity," and (ii) inserting the phrase ", in each case" immediately following the phrase "Cash Equivalent Investments". SECTION 8. Amendment to Financial Covenants. (a) The table set forth in Section 6.08 of the Credit Agreement is hereby amended to read in its entirety as follows: 3 4
"Fiscal Year Amount ------------ ------ 1999 $ 2,500,000,000 2000 $ 2,200,000,000 2001 $ 1,500,000,000 2002 $ 700,000,000 2003 $ 700,000,000 2004 $ 700,000,000 2005 $ 700,000,000 2006 $ 700,000,000"
(b) The table set forth in Section 6.16 of the Credit Agreement is hereby amended to read in its entirety as follows:
"Period Amount ------- ------ October 1, 1999- $ 0 December 31, 1999 January 1, 2000- $ 0 March 31,2000 April 1, 2000- $ 0 June 30, 2000 July 1, 2000- $ 80,000,000 September 30, 2000 October 1, 2000- $ 200,000,000 December 31, 2000 January 1, 2001- $ 225,000,000 March 31, 2001 April 1, 2001- $ 325,000,000" June 30, 2001
(c) The table set forth in Section 6.17(a) of the Credit Agreement is hereby amended to read in its entirety as follows: 4 5
"Period Total Leverage Ratio ------- -------------------- December 31, 2000- 15.00:1.00 June 29, 2001 June 30, 2001- 12.00:1.00 December 30, 2001 December 31, 2001- 11.00:1.00 June 29, 2002 June 30, 2002- 9.00:1.00 December 30, 2002 December 31, 2002- 7.00:1.00 December 30, 2003 December 31, 2003- 4.00:1.00" and thereafter
(d) The table set forth in Section 6.18 of the Credit Agreement is hereby amended to read in its entirety as follows:
"Period Senior Leverage Ratio ------- --------------------- December 31, 2000- 9.00:1.00 June 29, 2001 June 30, 2001- 7.00:1.00 December 30, 2001 December 31, 2001- 5.25:1.00 December 30, 2002 December 31, 2002- 3.25:1.0 December 30, 2003 December 31, 2003- 2.50:1.00" and thereafter
(e) In the table set forth in Section 6.19 of the Credit Agreement is hereby amended to read in its entirety as follows:
"Period Interest Coverage Ratio ------- ----------------------- July 1, 2001- 1.00:1.00 December 31, 2001 January 1, 2002- 1.25:1.00 December 31, 2002 January 1, 2003- 2.25:1.00 December 31, 2003 January 1, 2004- 3.00:1.00" and thereafter
5 6 SECTION 9. Representations of Borrower. The Borrower represents and warrants that, as of the Amendment Effective Date, both before and after giving effect to this Amendment, (i) the representations and warranties of the Borrower set forth in Article 3 of the Credit Agreement are true and correct and (ii) no Default has occurred and is continuing. SECTION 10. Amendment Fee. On or prior to the seventh Business Day following the Signature Receipt Date, the Borrower shall pay the Administrative Agent, for the ratable accounts of the Lenders who shall have executed and delivered a counterpart hereof (or other written confirmation in form satisfactory to the Administrative Agent that such Lender has signed a counterpart hereof) to the Administrative Agent on or prior to March 30, 2000, an amendment fee in an amount equal to 0.075% of the aggregate Commitments of such Lenders. SECTION 11. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York. SECTION 12. Counterparts. This Amendment may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. SECTION 13. Effectiveness. This Amendment shall become effective on and as of the date hereof (the "AMENDMENT EFFECTIVE DATE") on the date that the Administrative Agent shall have received (the "SIGNATURE RECEIPT DATE") from each of the Loan Parties and the Required Lenders a counterpart hereof signed by such party or facsimile or other written confirmation (in form satisfactory to the Administrative Agent) that such party has signed a counterpart hereof. 6 7 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written. WILLIAMS COMMUNICATIONS, INC. By: /s/ Howard Kalika ----------------------------------- Title: Vice President and Treasurer WILLIAMS COMMUNICATIONS GROUP, INC. By: /s/ Howard Kalika ------------------------------------ Title: Vice President and Treasurer BANK OF AMERICA, N.A. By: /s/ Roselyn Drake ------------------------------------ Title: Managing Director THE CHASE MANHATTAN BANK By: /s/ Constance M. Coleman ------------------------------------ Title: Vice President BANK OF MONTREAL By: /s/ Sarah Kim ------------------------------------ Title: Director 8 THE BANK OF NEW YORK By: /s/ Brendan Nedzi ----------------------------------- Title: Senior Vice President SCOTIABANC INC. By: /s/ W.J. Brown ----------------------------------- Title: Managing Director ABN AMRO BANK N.V. By: /s/ Ann Schwalbenberg ----------------------------------- Title: Vice President By: /s/ Ravneet Mumick ----------------------------------- Title: Vice President FLEET NATIONAL BANK By: ----------------------------------- Title: CIBC INC. By: /s/ Michele E. Roller ----------------------------------- Title: Executive Director CIBC World Markets Corp. as Agent 9 CREDIT SUISSE FIRST BOSTON By: /s/ Joel Glodowski ------------------------------------ Title: Managing Director By: /s/ Chris T. Horgan ------------------------------------ Title: Vice President DEUTSCHE BANK AG NEW YORK AND/OR CAYMAN ISLAND BRANCH By: /s/ Jon D. Storck ------------------------------------ Title: Vice President By: /s/ Sangita Gupte ------------------------------------ Title: Associate CREDIT LYONNAIS NEW YORK BRANCH By: ------------------------------------ Title: 10 BANK AUSTRIA CREDITANSTALT CORPORATE FINANCE, INC. By: /s/ Richard Varalla --------------------------------------- Title: Senior Associate By: /s/ William E. McCollum, Jr. --------------------------------------- Title: Vice President FIRST UNION NATIONAL BANK By: /s/ Steven J. Haas --------------------------------------- Title: Senior Vice President IBM CREDIT CORPORATION By: /s/ Ronald J. Bachner --------------------------------------- Title: Manager Commercial and Specialty Financing THE INDUSTRIAL BANK OF JAPAN, LIMITED, NEW YORK BRANCH By: /s/ Ryusuke Aya --------------------------------------- Title: Senior Vice President, Houston Office 11 BANK OF OKLAHOMA N.A. By: /s/ Robert D. Mattax --------------------------------------- Title: Senior Vice President THE FIRST NATIONAL BANK OF CHICAGO By: --------------------------------------- Title: KBC BANK, N.V. By: /s/ Robert Snauffer --------------------------------------- Title: First Vice President By: /s/ Patrick A. Janssens --------------------------------------- Title: Vice President THE FUJI BANK, LIMITED By: /s/ Jacques Azagury --------------------------------------- Title: Senior Vice President & Manager 12 Acknowledged and agreed: CNG COMPUTER NETWORKING GROUP, INC. CRITICAL CONNECTIONS, INC. DATA COMMUNICATIONS 2000, INC. INTERNET ENGINEERING & CONSULTANT, INC. WCS COMMUNICATIONS SYSTEMS, INC. WCS MICROWAVE SERVICES, INC. WCS, INC. WILLIAMS COMMUNICATIONS OF VIRGINIA, INC. WILLIAMS GLOBAL COMMUNICATIONS HOLDINGS, INC. WILLIAMS INTERNATIONAL VENTURES COMPANY WILLIAMS LEARNING NETWORK, INC. WILLIAMS LOCAL NETWORK, INC. WILLIAMS WIRELESS, INC. All By: /s/ Howard Kalika ----------------------------------- Title: Vice President and Treasurer THE WILLIAMS COMPANIES, INC. By: /s/ John Bumgarner ------------------------------------- Title: Senior Vice President