Exhibit 10.3
AMENDMENT NO. 2 AND WAIVER TO
AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT
dated as of May 9, 2008
among
XO COMMUNICATIONS, LLC
and
the GUARANTORS listed on the signature pages hereof
and
ARNOS CORP., as a Lender
and
BARBERRY CORP., as a Lender
and
HIGH RIVER LIMITED PARTNERSHIP, as a Lender
 

 

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AMENDMENT NO. 2 AND WAIVER TO AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT
     This AMENDMENT NO. 2 AND WAIVER TO AMENDED AND RESTATED CREDIT AND GUARANTY
AGREEMENT (this “Amendment No. 2 and Waiver”), dated as of May 9, 2008, is made
by and among XO Communications, LLC (the “Company”), certain guarantors
signatory hereto (the “Guarantors”) and Arnos Corp., Barberry Corp. and High
River Limited Partnership, each as a Lender.
WITNESSETH:
     WHEREAS, the Company (as successor-by-merger to XO Communications, Inc.),
the Guarantors, certain lenders party thereto and the administrative agent named
therein (the “Administrative Agent”) entered into an Amended and Restated Credit
and Guaranty Agreement, dated as of January 16, 2003 (as amended, supplemented
or otherwise modified as of the date hereof, the “Original Credit Agreement”, as
further amended by this Amendment No. 2 and Waiver and as the same may be
further amended, supplemented or otherwise modified from time to time in
accordance with its terms, the “Credit Agreement”);
     WHEREAS, pursuant to that certain Final Judgment and Order entered by the
Court of Chancery of the State of Delaware on March 31, 2008 approving the
Stipulation and Agreement of Compromise, Settlement and Release, dated as of
January 14, 2008 (the “Stipulation”), providing for a global settlement of
litigation initiated by certain of the Company’s minority stockholders against
the Company and certain of its current and former directors, the parties thereto
have agreed that (i) as of the effective date of the Stipulation, the financial
covenants set forth in Section 6.6 of the Credit Agreement shall be waived
through July 15, 2009, and any existing default of any financial covenant set
forth in such section shall be deemed waived and (ii) effective as of January 1,
2008, the interest accruing on each of the Tranche A Lender’s (as such term is
defined below) Term Loan shall be reduced by one hundred fifty (150) basis
points;
     WHEREAS, pursuant to Section 10.5 of the Credit Agreement, the Requisite
Lenders have the right to waive any provision of the Credit Documents or consent
to any departure of any Credit Party therefrom or may take any action
contemplated in the Credit Documents and such waiver shall be effective upon the
written concurrence of the Requisite Lenders;
     WHEREAS, under Section 1.1 of the Credit Agreement, “Requisite Lenders”
means one or more Lenders having or holding Term Loan Exposure representing more
than 50% of the aggregate Term Loan Exposure of all Lenders.
     WHEREAS, the undersigned desires to waive compliance by the Company with
the requirements of Section 6.6 of the Credit Agreement on the terms and for the
periods set forth herein.
     WHEREAS, the parties hereto desire to amend the Original Credit Agreement
in certain respects in accordance with Section 10.5 thereof;

 

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     NOW, THEREFORE, in consideration of the mutual agreements herein contained
and of other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
     SECTION 1.1. Definitions. Except as otherwise defined in this Amendment
No. 2 and Waiver, terms defined in Section 1.1 of the Original Credit Agreement
are used herein as defined therein, with such definitions applying to terms that
are used without definition in the recitals to this Amendment No. 2 and Waiver.
ARTICLE II
WAIVER OF SECTION 6.6 OF THE CREDIT AGREEMENT
     SECTION 2.1. Effective as of April 30, 2008, the undersigned hereby waives
compliance by the Company and the Guarantors with the requirements of
Section 6.6 (Financial Covenants) of the Credit Agreement from the date hereof
through July 15, 2009, and any existing default of any financial covenant set
forth in such section is hereby waived.
ARTICLE III
AMENDMENT OF THE CREDIT AGREEMENT
     SECTION 3.1. (a) Section 1.1. Section 1.1 of the Original Credit Agreement
is hereby amended by adding each of the following definitions, to be inserted in
Section 1.1 in the appropriate alphabetical order:
     “Second Amendment Effective Date” means January 1, 2008.
     “Tranche A Lenders” means each of Arnos Corp., a Nevada corporation, High
River Limited Partnership, a Delaware limited partnership and a direct assignee
of Arnos Corp., and Barberry Corp., a Delaware corporation and an indirect
assignee of Arnos Corp., together with each such Tranche A Lender’s successors
and permitted assigns.
     “Tranche B Lenders” means each Lender that is not a Tranche A Lender,
together with each such Tranche B Lender’s successors and permitted assigns.
     (b) Section 2.6(a). Section 2.6(a) is hereby amended and restated in its
entirety as follows:

 

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               “(a) Except as otherwise set forth herein, each Term Loan made or
held by a Tranche A Lender shall bear interest on the unpaid principal amount
thereof from the date made through repayment (whether by acceleration or
otherwise) thereof as follows:
               (A) during the period beginning on the Closing Date and ending on
the Second Amendment Effective Date:
                    (1) if a Base Rate Loan, at the Base Rate plus 5.00%; or
                    (2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate plus 6.00%; and
               (B) during the period beginning on the Second Amendment Effective
Date and ending on the Cash Pay Conversion Date:
                    (1) if a Base Rate Loan, at the Base Rate plus 3.50%; or
                    (2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate plus 4.50%; and
               (C) at all times after the Cash Pay Conversion Date:
                    (1) if a Base Rate Loan, at the Base Rate plus 1.50%; or
                    (2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate plus 2.50%.”
          (ii) Except as otherwise set forth herein, each Term Loan made or held
by a Tranche B Lender shall bear interest on the unpaid principal amount thereof
from the date made through repayment (whether by acceleration or otherwise)
thereof as follows:
               (A) during the period beginning on the Closing Date and ending on
the Cash Pay Conversion Date:
                    (1) if a Base Rate Loan, at the Base Rate plus 5.00%; or
                    (2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate plus 6.00%; and
               (B) at all times after the Cash Pay Conversion Date:
                    (1) if a Base Rate Loan, at the Base Rate plus 3.00%; or

                    (2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate plus 4.00%.”

 

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ARTICLE IV
MISCELLANEOUS
     SECTION 4.1. Miscellaneous.
          (a) From and after the date hereof, each reference in the Credit
Agreement to “this Agreement”, or any like expression referring to the Credit
Agreement, shall be deemed to refer to the Original Credit Agreement as amended
by this Amendment No. 2 and Waiver. Each of the Company and the Guarantors, by
its execution and delivery of this Amendment No. 2 and Waiver, confirm that all
of its obligations under the Original Credit Agreement, other than as modified
hereby, remain unchanged and in full force and effect.
          (b) Except as expressly provided herein, (a) the execution, delivery
and performance of this Amendment No. 2 and Waiver shall not constitute a waiver
of any provision of, or operate as a waiver of any right, power or remedy of the
Administrative Agent or any Lender under the Credit Agreement or any other
Credit Document and (b) the Credit Agreement as modified and the other Credit
Documents shall remain in full force and effect and are hereby ratified and
confirmed.
          (c) The terms and provisions hereof shall inure to the benefit of and
be binding on the parties hereto and their respective successors and assigns.
          (e) This Amendment No. 2 and Waiver and the rights and obligations of
the parties hereunder shall be governed by, and shall be construed and enforced
in accordance with, the internal laws of the State of New York.
          (f) This Amendment No. 2 and Waiver may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document.
     IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment
No. 2 and Waiver to be duly executed and delivered as of the day and year first
above written.

            XO COMMUNICATIONS, LLC
      By:   /s/ Gregory W. Freiberg         Name : Gregory W. Freiberg       
Title:     Chief Financial Officer   

 

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            ARNOS CORP., as a Lender
      By:   /s/ Edward Muthner         Name:   Edward Muthner        Title:  
Vice President   

            BARBERRY CORP., as a Lender
      By:   /s/ Edward Muthner         Name:   Edward Muthner        Title:  
Authorized Signatory     

            HIGH RIVER LIMITED PARTNERSHIP, as a Lender
      By:   Hopper Investment LLC, its general partner              By:   /s/
Edward Muthner         Name:   Edward Muthner        Title:   Authorized
Signatory     

GUARANTORS:
XO Holdings, Inc.
Nextlink Wireless, Inc.
V & K Holdings, Inc.
XO Communications Services, Inc.
XO Virginia, LLC
XO Interactive, Inc.
XO International Holdings, Inc.
XO International, Inc.
XO Nevada Merger Sub, Inc.
Telecommunications of Nevada, LLC
XO Services, Inc.
XO NS Inc.
XO Asia Limited

                  By:   /s/ Gregory W. Freiberg         Name : Gregory W.
Freiberg        Title:   Chief Financial Officer