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Exhibit 4.19    
  

 
 

        WAIVER
dated as of March 14, 2003 (this "Waiver") to (i) the Credit Agreement dated as of May 31, 2000 (as amended,
supplemented or otherwise modified from time to time, the "Pre-Petition Credit Agreement") among MCLEODUSA INCORPORATED, a Delaware
corporation ("McLeodUSA" or the "Borrower"), the lenders from time to time party thereto (the
"Pre-Petition Lenders") and JPMorgan Chase Bank ("JPMCB"), as Administrative Agent and as
Collateral Agent (in such capacities, the "Pre-Petition Agent"), and (ii) the Credit Agreement dated as of April 16, 2002 (as
amended, supplemented or otherwise modified from time to time, the "Exit Credit Agreement", and together with the Pre-Petition Credit
Agreement, the "Credit Agreements") among McLeodUSA, the lenders from time to time party thereto (the "Exit
Lenders", and together with the Pre-Petition Lenders, the "Lenders") and JPMCB, as Administrative Agent and as
Collateral Agent (in such capacities, the "Exit Agent", and together with the Pre-Petition Agent, the
"Agent"). 

        A.    McLeodUSA
has informed the Lenders that Financial Accounting Statement No. 144 ("FAS 144") will require that
McLeodUSA restate its financial statements for the fiscal years ending December 31, 2000 and 2001 to reflect McLeodUSA's dispositions of certain discontinued operations, and that in order to be
in compliance with GAAP, the changes to the financial statements for discontinued operations must be audited. 

        B.    McLeodUSA
has informed the Lenders that Deloitte & Touche LLP ("Deloitte") has replaced Arthur Andersen LLP
("Arthur Andersen") as McLeodUSA's independent public accountant. 

        C.    McLeodUSA
has informed the Lenders that, since Arthur Andersen no longer exists, a re-audit by Deloitte would be required in order for the 2000 and 2001
financial statements to be in compliance with GAAP. 

        D.    McLeodUSA
has informed the Lenders that it does not believe the expense or diversion of management's time associated with a re-audit is in the best interest
of the Lenders or the shareholders. 

        E.    McLeodUSA
has communicated to the Lenders an alternative plan, which would be to provide unaudited schedules covering discontinued operations in its
Form 10-K filing with respect to the fiscal years ended December 31, 2001 and December 31, 2000. 

        F.    McLeodUSA
has requested that the Lenders waive compliance by McLeodUSA with Section 5.01(a) of each Credit Agreement to the extent that such Section requires the
delivery of comparative financial statements including audited financial statements for the fiscal year ended December 31, 2001 that were prepared in accordance with GAAP. 

        G.    The
undersigned Lenders and the Agent are willing to agree to such waivers, on the terms, subject to the conditions and to the extent set forth herein. 

        In
consideration of the mutual agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows: 

        SECTION
1.    Definitions; References.    Unless otherwise specifically defined herein, each capitalized term used
herein but not otherwise defined herein which is defined in the Credit Agreements shall have the meaning assigned to such term in the Credit Agreements. 

        SECTION
2.    Waiver.    Pursuant to Section 9.02(b) of each Credit Agreement, effective as of the Effective
Date (as defined in Section 4 hereof), (a) the Pre-Petition Lenders hereby waive compliance by McLeodUSA with Section 5.01(a) of the Pre-Petition Credit
Agreement and (b) the Exit Lenders hereby waive compliance by McLeodUSA with Section 5.01(a) of the Exit Credit Agreement, in each case to the extent, but only to the extent, that
(i) such Section requires that the consolidated balance sheet of McLeodUSA and the Restricted Subsidiaries and related statements of operations, stockholders' equity and cash flows as of the
end of and for the fiscal year ended December 31, 2001 

set forth in the comparative financial statements required to be delivered to the Lenders pursuant to the terms of such Section are audited and presented in accordance with GAAP consistently applied
and (ii) any such non-compliance is limited solely to, and results directly from, the restatement requirements set forth in FAS 144 with respect to dispositions of
discontinued operations; provided, however, that McLeodUSA shall deliver to each Lender (A) the
audited financial information required to be delivered pursuant to Section 5.01(a) for the fiscal year ended December 31, 2002 and the audited financial statements for the fiscal years
ended December 31, 2001 and 2000 as audited by Arthur Andersen and as previously delivered to the Lenders (the "2000 and 2001 Audited Financial
Statements") and (B) an unaudited consolidated balance sheet of McLeodUSA and the Restricted Subsidiaries and related statements of operations and cash flows as of the
end of and for the fiscal year ended December 31, 2001 (in each case giving effect to the discontinued operations as required by FAS 144), with the information delivered pursuant to
clauses (A) and (B) being in form and substance reasonably
satisfactory to the Agent and certified by a Financial Officer of McLeodUSA as (1) being true and correct in all material respects and (2) setting forth all material adjustments to the
2000 and 2001 Audited Financial Statements required by FAS 144. McLeodUSA acknowledges and agrees that, in the event McLeodUSA fails to deliver the financial statements set forth in the proviso
above by April 10, 2003, the waivers set forth in the first sentence of this Section 2 shall terminate and be of no further force, with the same effect as if they had never been granted. 

        SECTION
3.    Representations and Warranties.    To induce the other parties hereto to enter into this Waiver,
McLeodUSA represents to each of the Lenders and the Agent that, as of the Effective Date: 

          (i)  after
giving effect to this Waiver, the representations and warranties of McLeodUSA set forth in each of the Loan Documents with respect to each Credit Agreement are
true and correct on the Effective Date with the same effect as if made on the Effective Date, except to the extent such representations and warranties expressly relate to an earlier date, in which
case such representations and warranties were true and correct as of such earlier date; 

        (ii)  after
giving effect to this Waiver, no Default has occurred and is continuing under either Credit Agreement; and 

        (iii)  this
Waiver has been duly executed and delivered by McLeodUSA and constitutes a legal, valid and binding obligation of McLeodUSA, enforceable against it in accordance
with its terms. 

        SECTION
4.    Conditions to Effectiveness.    This Waiver shall become effective as of the date (the
"Effective Date") upon which (i) the Agent shall have received counterparts of this Waiver that, when taken together, bear the signatures of
McLeodUSA and the Required Lenders (as defined in the Pre-Petition Credit Agreement) under the Pre-Petition Credit Agreement and of McLeodUSA and the Required Lenders (as
defined in the Exit Credit Agreement) under the Exit Credit Agreement and (ii) the Agent shall have received all fees and other amounts due and payable on or prior to the Effective Date,
including, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses (including fees, charges and disbursements of counsel), required to be reimbursed or
paid by any Loan Party under either Credit Agreement hereunder or under any other Loan Document with respect to either Credit Agreement. 

        SECTION
5.    Effect of Waiver.    Except as expressly set forth herein, this Waiver shall not by implication or
otherwise limit, impair, constitute a waiver of, amend, or otherwise affect the rights and remedies of the Lenders, the Agent or McLeodUSA under either Credit Agreement or any other Loan Document with
respect to either Credit Agreement and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in either Credit Agreement or
any other Loan Document with respect to either Credit Agreement, all of which are ratified and affirmed in all respects and shall continue in full force and effect. This Waiver shall apply and be
effective with respect only to the matters expressly referred to herein, and nothing herein shall be deemed to entitle McLeodUSA to a consent to, or a waiver, amendment, modification or other change
of, any of the terms, conditions, obligations, covenants or agreements contained in either Credit Agreement or any other Loan Document with respect to either Credit Agreement in similar or 

different circumstances. After the Effective Date, any reference to either Credit Agreement shall mean such Credit Agreement, as modified hereby. This Waiver shall constitute a "Loan Document" for
all purposes under each Credit Agreement and the Loan Documents with respect to each Credit Agreement. 

        SECTION
6.    Applicable Law.    THIS WAIVER SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

        SECTION
7.    Counterparts.    This 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 of which when taken together shall constitute but one and the same instrument.
Delivery of an executed signature page of this Waiver by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. 

        SECTION
8.    Costs and Expenses.    McLeodUSA agrees to reimburse the Agent for its reasonable
out-of-pocket expenses in connection with this Waiver, including the reasonable fees, charges and disbursements of counsel for the Agent. 

        SECTION
9.    Headings.    The headings of this Waiver are for purposes of reference only and shall not limit or
otherwise affect the meaning hereof. 

        IN
WITNESS WHEREOF, the parties hereto have caused this Waiver to be duly executed by their respective authorized officers as of the day and year first written above. 

	

 	

MCLEODUSA INCORPORATED,
	

 	

by:	
 	

/s/ Joseph Ceryanec

	 	 	 	Name:	 	Joseph Ceryanec
	 	 	 	Title:	 	Vice President Controller
	

 	

 	
 	

JPMORGAN CHASE BANK,

individually and as Agent,
	

 	

by:	
 	

/s/ John Kowalczuk

	 	 	 	Name:	 	John Kowalczuk
	 	 	 	Title:	 	Vice President

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Exhibit 4.19

WAIVER – 3/14/03<Page>

                                                                     EXHIBIT 4.1

                                PAY-OFF AGREEMENT

                                 August 23, 2002

VIA FACSIMILE AND
     OVERNIGHT MAIL

Ballantyne of Omaha, Inc., as Leading Borrower
4350 McKinley Street
Omaha, Nebraska 68112
Attention: Mr. Brad French, Treasurer

     Re:   Loan and Security Agreement, dated as of August 30, 2001, by an among
           Ballantyne of Omaha, Inc. ("LEADING BORROWER"), Design &
           Manufacturing, Inc., XenoTech Rental Corp. and Xenotech Strong, Inc.
           (collectively, the "OTHER BORROWERS"; Leading Borrower and Other
           Borrowers being collectively referred to as the "BORROWERS" and each
           as a "BORROWER"), and General Electric Capital Corporation
           ("LENDER"), as amended by that certain First Amendment to Loan and
           Security Agreement, dated as of March 26, 2002 (collectively, the
           "LOAN AGREEMENT").

Gentlemen:

     All capitalized terms used but not otherwise defined herein shall have the
meanings ascribed to them in the above-described Loan Agreement.

     The total amount necessary to pay in full as of this date all outstanding
Loans and other Obligations (other than any and all indemnity obligations under
any of the Loan Documents not yet due and payable and which by their terms
survive the termination of such Loan Documents (collectively, the "INDEMNITY
OBLIGATIONS")) of the Borrowers to the Lender under the Loan Agreement and the
other Loan Documents is as follows:

<Table>
   <S>                                                         <C>
   (i)   Aggregate outstanding principal balance of the
         Obligations as of this date ........................  $  1,000,000.00

   (ii)  Accrued but unpaid interest on the Obligations
         as of this date ....................................  $      5,034.58

   (iii) Other:
         Prepayment and settlement fee ......................  $    100,000.00
         Unused Credit Line fee .............................  $      1,749.93
         Wire Charge fees ...................................  $         50.00
         Collateral Monitoring fee ..........................  $        677.42
         Legal fees .........................................  $      5,936.54
         Audit expenses 7/22-7/26/02 (field review) .........  $      4,541.26
                                                               ---------------
</Table>

<Page>

<Table>
   <S>                                                         <C>
   (iv)  Total pay-off amount
         on the Loan(s) and the other
         Obligations (sum of (i)-(iii))(other
         than the Indemnity Obligations).....................  $  1,117,989.73

   LESS:

   Deposits on hand not applied to the loan balance .........  $ (1,300,000.00)
                                                               ---------------

   Remaining pay-off due ....................................  $   (182,010.27)
</Table>

     The Borrowers and the Lender agree that the Lender shall retain all
deposits in the Collection Account on hand as of the date of this letter and
shall retain such deposits made in the Collection Account subsequent thereto
until the amount so retained by the Lender is equal to the total pay-off amount
set forth in (iv) above (the "PAY-OFF AMOUNT"). The Pay-Off Amount is subject to
adjustment with respect to any Obligations accruing subsequent to the date
hereof until the date upon which the Pay-Off Amount has been paid in full. All
deposits to the Collection Account received by the Lender in excess of the
Pay-Off Amount, if any, shall be promptly returned to the Leading Borrower.

     Subject to the Lender's receipt of the Pay-Off Amount in full in accordance
with the preceding paragraph, the Lender agrees: (a) Borrower will not be
indebted to the Lender for any reason under the Loan Agreement or the other Loan
Documents (other than with respect to the Indemnity Obligations), (b) all of the
Lender's security interests in, security titles to and other liens on all real
and personal property of the Borrower pursuant to the Loan Agreement will be
automatically terminated and released, (c) all Guarantors of the Obligations
will be automatically released from their obligations to the Lender (other than
with respect to the Indemnity Obligations), (d) the Lender shall execute and
deliver to the Borrowers letters in the form of EXHIBIT A attached hereto
terminating each of the Account Agreements entered into in connection with the
Loan Agreement, and (e) the Borrowers shall be authorized to file any and all
Uniform Commercial Code ("UCC") financing statement terminations with respect to
the Lender's UCC financing statement filings on the Borrowers and the Lender
will execute any and all mortgage releases (including such releases with respect
to Borrower's real property located in Douglas County, Nebraska and Champaign
County, Illinois) and other such lien release documents filed in connection with
the Loan Documents in order to evidence or otherwise give public notice of such
collateral terminations and releases (provided, however, that any and all such
termination statements, mortgage releases and other such documents shall be
prepared and recorded at the Borrowers' expense).

     By signing below, the Borrowers, the Guarantors and the Lender each
acknowledge and agree that (a) the Domestic Revolving Credit Loan, the Foreign
Revolving Credit Loan and the Term Loan have been terminated by the Borrowers as
of this date, (b) each of the Loan Documents is terminated as of this date
(other than the provisions contained in such Loan Documents with respect to
Indemnity Obligations), and (c) the Lender shall have no further obligation to
make any Loans or other financial accommodations to or on behalf of the
Borrowers under the Loan Documents.

     For and in consideration of the Lender's agreements contained herein, the
Borrowers and the Guarantors hereby forever release and discharge the Lender,
its officers, directors, employees, agents, representatives, successors and
assigns (collectively, the "RELEASED PARTIES") from any and all claims, causes
of action, damages and liabilities of any nature whatsoever,

<Page>

known or unknown, which such Person ever had, now has or might hereafter have
against the Released Parties which relate, directly or indirectly, to the Loan
Agreement or any of the Loan Documents or the transactions relating thereto
(other than the Lender's agreement and obligations under this letter).

     For and in consideration of the Lender's agreements contained herein, the
Borrowers agree to reimburse and pay, within three days of demand therefor, in
immediately available funds, all losses, liabilities, charges, expenses and fees
which the Lender may incur as a result of any non-payment, claim, refund or
charge back of any checks or other items which have been credited by the Lender
to the Borrowers' loan account with the Lender, together will all expenses and
other charges incident thereto. Additionally, the Borrowers agrees to reimburse
and pay, within three days of demand therefor, in immediately available funds,
all losses, liabilities, charges, expenses and fees (i) which the Lender may
have incurred or may now or hereafter incur in connection with the transactions
contemplated hereby which have not as yet been reflected in the Borrower's loan
account which Borrowers are, or may be, required to bear pursuant to the Loan
Documents and (ii) which the Lender may incur as a result of errors in
calculation of any amounts due the Lender by the Borrowers. Notwithstanding
anything to the contrary contained herein, the Lender hereby reserves all of its
rights in and to any checks or similar instruments for payment of money
heretofore received by the Lender in connection with its loan arrangements with
the Borrowers under the Loan Agreement and all of its rights to any monies due
or to become due under paid checks or similar instruments for which the Lender
gave credit to any of the Borrowers in calculating the foregoing Pay-Off Amount.

     The Lender hereby requests that each of the Borrowers and the Guarantors
acknowledge its receipt and acceptance of and agreement to the terms and
conditions set forth in this letter by signing a copy of it in the appropriate
space indicated below and returning it to the Lender no later than 5.00 PM on
August 26, 2002. This letter must be signed by each of the Borrowers and the
Guarantors and shall not become effective unless and until it is so accepted and
agreed to by each of the Borrowers and the Guarantors and returned to the
Lender. Delivery of a photocopy or telecopy of an executed counterpart of this
letter shall be effective as delivery of a manually executed original
counterpart of this letter.

                                        Very truly yours,

                                        GENERAL ELECTRIC CAPITAL CORPORATION

                                        By: /s/ Michael Thornton
                                            -------------------------------
                                        Name: Account Manager
                                              -----------------------------
                                        Its:  Duly Authorized Signatory

<Page>

Each of the undersigned hereby acknowledges
its receipt and acceptance of and agreement
to the terms and conditions of this letter:

BORROWERS:

BALLANTYNE OF OMAHA, INC.

By: /s/ John P. Wilmers
    -------------------------------
Name: John P. Wilmers
      -----------------------------
Title: President
       ----------------------------

DESIGN & MANUFACTURING, INC.

By: /s/ John P. Wilmers
    -------------------------------
Name: John P. Wilmers
      -----------------------------
Title: President
       ----------------------------

XENOTECH RENTAL, INC.

By: /s/ John P. Wilmers
    -------------------------------
Name: John P. Wilmers
      -----------------------------
Title: President
       ----------------------------

XENOTECH STRONG, INC.

By: /s/ John P. Wilmers
    -------------------------------
Name: John P. Wilmers
      -----------------------------
Title: President
       ----------------------------

<Page>

GUARANTORS:

STRONG WESTREX, INC.

By: /s/ John P. Wilmers
    -------------------------------
Name: John P. Wilmers
      -----------------------------
Title: President
       ----------------------------

BALLANTYNE OVERSEAS CORP.

By: /s/ John P. Wilmers
    -------------------------------
Name: John P. Wilmers
      -----------------------------
Title: President
       ----------------------------

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