-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, P3Vh485Qk4FWtPjCWjyEQcwMTpFtyzx+F3nOm0CzRDsiguc4dZd0LrGxC656l0kq nPoPKsFQxHLJkOJcktIDMA== 0000950134-99-010989.txt : 19991214 0000950134-99-010989.hdr.sgml : 19991214 ACCESSION NUMBER: 0000950134-99-010989 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19991213 GROUP MEMBERS: HICKS MUSE (1999) FUND IV LLC GROUP MEMBERS: HICKS MUSE GP (1999) PARTNERS IV LP GROUP MEMBERS: HICKS MUSE PG-IV (1999) CV GROUP MEMBERS: HICKS THOMAS O GROUP MEMBERS: HM 4-EQ (1999) COINVESTORS LP GROUP MEMBERS: HM 4-EQ GLOBIX COINVESTORS LLC GROUP MEMBERS: HM 4-SBS (1999) COINVESTORS LP GROUP MEMBERS: HM 4-SBS GLOBIX COINVESTORS LLC GROUP MEMBERS: HM EQUITY FUND IV/GP PARTNERS (1999) CV GROUP MEMBERS: HM FUND IV CAYMAN LLC GROUP MEMBERS: HM GP PARTNERS IV CAYMAN LP GROUP MEMBERS: HM PG-IV GLOBIX LLC GROUP MEMBERS: HM4 GLOBIX PRIVATE FUND LLC GROUP MEMBERS: HM4 GLOBIX QUALIFIED FUND LLC GROUP MEMBERS: HM4/GP (1999) PARTNERS LP GROUP MEMBERS: HMTF BRIDGE GLOBIX LLC GROUP MEMBERS: HMTF BRIDGE PARTNERS LLC GROUP MEMBERS: HMTF BRIDGE PARTNERS LP GROUP MEMBERS: HMTF EQUITY FUND IV (1999) LP GROUP MEMBERS: HMTF PRIVATE EQUITY FUND IV (1999) LP SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: GLOBIX CORP CENTRAL INDEX KEY: 0001003111 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-COMPUTER & PERIPHERAL EQUIPMENT & SOFTWARE [5045] IRS NUMBER: 133781263 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D SEC ACT: SEC FILE NUMBER: 005-47401 FILM NUMBER: 99773332 BUSINESS ADDRESS: STREET 1: 139 CENTRE STREET CITY: NEW YORK STATE: NY ZIP: 10013 BUSINESS PHONE: 2125945300 FORMER COMPANY: FORMER CONFORMED NAME: BELL TECHNOLOGY GROUP LTD DATE OF NAME CHANGE: 19951106 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HICKS THOMAS O CENTRAL INDEX KEY: 0000938201 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 459720171 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 200 CRESCENT COURT STREET 2: SUITE 1600 CITY: DALLAS STATE: TX ZIP: 75201 BUSINESS PHONE: 2147407300 MAIL ADDRESS: STREET 1: 200 CRESCENT COURT STREET 2: SUITE 1600 CITY: DALLAS STATE: TX ZIP: 75201 SC 13D 1 SCHEDULE 13D 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------------------ SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934 GLOBIX CORPORATION (Name of Issuer) COMMON STOCK, PAR VALUE $.01 PER SHARE (Title of Class of Securities) 07814V 10 2 (CUSIP Number) THOMAS O. HICKS C/O HICKS, MUSE, TATE & FURST INCORPORATED 200 CRESCENT COURT SUITE 1600 DALLAS, TEXAS 75201 (214) 740-7300 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) December 3, 1999 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. [ ] (Continued on following pages) ================================================================================ 2 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) Mr. Thomas O. Hicks - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds N/A - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization United States ------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- Owned by Each Reporting 8 Shared Voting Power* 2,000,000 ------------------------------------------- Person With 9 Sole Dispositive Power 0 ------------------------------------------- 10 Shared Dispositive Power* 2,000,000 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 2,000,000 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 19.3% - -------------------------------------------------------------------------------- 14 Type of Reporting Person IN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 2 3 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM4 Globix Qualified Fund, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- Owned by Each Reporting 8 Shared Voting Power* 1,362,075 ------------------------------------------- Person With 9 Sole Dispositive Power 0 ------------------------------------------- 10 Shared Dispositive Power* 1,362,075 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 1,362,075 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 14.0% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 3 4 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HMTF Equity Fund IV (1999), L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 1,362,075 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 1,362,075 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person* 1,362,075 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 14.0% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 4 5 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM4 Globix Private Fund, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially 8 Shared Voting Power* 9,650 Owned by Each Reporting. 9 Sole Dispositive Power 0 Person With 10 Shared Dispositive Power* 9,650 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 9,650 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.1% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 5 6 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HMTF Private Equity Fund IV (1999), L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 9,650 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 9,650 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 9,650 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.1% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 6 7 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM4/GP (1999) Partners, L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 1,371,725 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 1,371,725 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 1,371,725 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 14.1% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 7 8 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM 4-EQ Globix Coinvestors, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 ------------------------------------------- Number of Shares Beneficially 8 Shared Voting Power* 22,250 ------------------------------------------- Owned by Each Reporting 9 Sole Dispositive Power 0 ------------------------------------------- Person With 10 Shared Dispositive Power* 22,250 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 22,250 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.3% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 8 9 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM 4-EQ (1999) Coinvestors, L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 ------------------------------------------- Number of Shares Beneficially 8 Shared Voting Power* 22,250 ------------------------------------------- Owned by Each Reporting 9 Sole Dispositive Power 0 ------------------------------------------- Person With 10 Shared Dispositive Power* 22,250 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 22,250 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.3% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 9 10 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM 4-SBS Globix Coinvestors, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------ 8 Shared Voting Power* 33,500 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 33,500 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 33,500 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.4% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 10 11 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM 4-SBS (1999) Coinvestors, L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 33,500 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 33,500 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 33,500 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.4% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 11 12 CUSIP NO. 07814V 10 2 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) Hicks, Muse GP (1999) Partners IV, L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 ------------------------------------------- Number of Shares Beneficially 8 Shared Voting Power* 1,427,475 ------------------------------------------- Owned by Each Reporting 9 Sole Dispositive Power 0 ------------------------------------------- Person With 10 Shared Dispositive Power* 1,427,475 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 1,427,475 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 14.6% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 12 13 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) Hicks, Muse (1999) Fund IV, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 1,427,475 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 1,427,475 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 1,427,475 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 14.6% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 13 14 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM PG-IV Globix, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 72,525 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 72,525 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 72,525 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.9% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 14 15 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) Hicks, Muse PG-IV (1999), C.V. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Netherlands - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 72,525 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 72,525 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 72,525 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.9% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 15 16 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM Equity Fund IV/GP Partners (1999), C.V. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Netherlands - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 72,525 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 72,525 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 72,525 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.9% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 16 17 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM GP Partners IV Cayman, L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Cayman Islands - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- Owned by Each Reporting 8 Shared Voting Power* 72,525 ------------------------------------------- Person With 9 Sole Dispositive Power 0 ------------------------------------------- 10 Shared Dispositive Power* 72,525 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 72,525 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.9% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 17 18 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HM Fund IV Cayman LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Cayman Islands - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- Owned by Each Reporting 8 Shared Voting Power* 72,525 ------------------------------------------- Person With 9 Sole Dispositive Power 0 ------------------------------------------- 10 Shared Dispositive Power* 72,525 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 72,525 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 0.9% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5%Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 18 19 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HMTF Bridge Globix, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 500,000 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 500,000 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 500,000 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 5.6% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 19 20 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HMTF Bridge Partners, L.P. - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- 8 Shared Voting Power* 500,000 Owned by Each Reporting ------------------------------------------- 9 Sole Dispositive Power 0 Person With ------------------------------------------- 10 Shared Dispositive Power* 500,000 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 500,000 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 5.6% - -------------------------------------------------------------------------------- 14 Type of Reporting Person PN - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 20 21 CUSIP NO. 07814V 10 2 - -------------------------------------------------------------------------------- 1 Name of Reporting Person I.R.S. Identification No. of above person (entities only) HMTF Bridge Partners, LLC - -------------------------------------------------------------------------------- 2 Check the appropriate box if a member of a group* (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3 SEC use only - -------------------------------------------------------------------------------- 4 Source of Funds OO - -------------------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization Texas - -------------------------------------------------------------------------------- 7 Sole Voting Power 0 Number of Shares Beneficially ------------------------------------------- Owned by Each Reporting 8 Shared Voting Power* 500,000 ------------------------------------------- Person With 9 Sole Dispositive Power 0 ------------------------------------------- 10 Shared Dispositive Power* 500,000 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by each Reporting Person** 500,000 - -------------------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11)** 5.6% - -------------------------------------------------------------------------------- 14 Type of Reporting Person OO - -------------------------------------------------------------------------------- * The Reporting Person expressly disclaims (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such reporting person. ** Assuming conversion of all Series A 7.5% Convertible Preferred Stock beneficially owned by such reporting person, but without giving effect to the conversion into Common Stock of any Series A 7.5% Convertible Preferred Stock held by others. See Item 5. Page 21 22 ITEM 1. SECURITY AND ISSUER. The class of equity securities to which this Schedule 13D (this "Statement") relates is the Common Stock, par value $.01 per share (the "Common Stock"), of Globix Corporation, a Delaware corporation (the "Issuer"). The address of the Issuer's principal executive offices is 139 Centre Street, New York, New York 10013. ITEM 2. IDENTITY AND BACKGROUND. (a) Name of Person(s) Filing this Statement (the "Reporting Persons"): Mr. Thomas O. Hicks HM4 Globix Qualified Fund, LLC, a Delaware limited liability company ("Qualified LLC") HMTF Equity Fund IV (1999), L.P., a Texas limited partnership ("Equity L.P.") HM4 Globix Private Fund, LLC, a Delaware limited liability company ("Private LLC") HMTF Private Equity Fund IV (1999), L.P., a Texas limited partnership ("Private L.P.") HM4/GP (1999) Partners, L.P., a Texas limited partnership ("HM4/GP Partners") HM 4-EQ Globix Coinvestors, LLC, a Delaware limited liability company ("4-EQ LLC") HM 4-EQ (1999) Coinvestors, L.P., a Texas limited partnership ("4-EQ L.P.") HM 4-SBS Globix Coinvestors, LLC, a Delaware limited liability company ("4-SBS LLC") HM 4-SBS (1999) Coinvestors, L.P., a Texas limited partnership ("4-SBS L.P.") Hicks, Muse GP (1999) Partners IV, L.P., a Texas limited partnership ("Hicks GP Partners") Hicks, Muse (1999) Fund IV, LLC, a Texas limited liability company ("Fund IV LLC") HM PG-IV Globix, LLC, a Delaware limited liability company ("PG-IV LLC") Hicks, Muse PG-IV (1999), C.V., a limited partnership organized under the laws of the Netherlands ("PG-IV C.V.") HM Equity Fund IV/GP Partners (1999), C.V., a limited partnership organized under the laws of the Netherlands ("HM Equity C.V.") HM GP Partners IV Cayman, L.P., a Cayman Islands exempted limited partnership ("GP Cayman L.P.") HM Fund IV Cayman LLC, an exempted Cayman Islands limited liability company ("Fund IV Cayman LLC") HMTF Bridge Globix, LLC, a Delaware limited liability company ("Bridge LLC") HMTF Bridge Partners, L.P., a Delaware limited partnership ("Bridge Partners L.P.") HMTF Bridge Partners, LLC, a Texas limited liability company ("Bridge Partners LLC") (b)-(c) Mr. Thomas O. Hicks Mr. Thomas O. Hicks is chief executive officer of Hicks, Muse, Tate & Furst Incorporated ("Hicks, Muse"), a private investment firm primarily engaged in leveraged acquisitions, recapitalizations and other investment activities. Mr. Hicks is also the sole member and sole manager of Fund IV LLC, which is the sole general partner of Hicks GP Partners, which is the sole general partner of HM4/GP Partners, which is the sole general partner of each of Equity L.P. and Private L.P. Equity L.P. is the sole member of Qualified LLC, and Private L.P. is the sole member of Private LLC. Hicks GP Partners is also the sole general partner of each of 4-SBS L.P. and 4-EQ L.P. 4-SBS L.P. is the sole member of 4-SBS LLC, and 4-EQ L.P. is the sole member of 4-EQ LLC. Mr. Hicks is also the sole member of Fund IV Cayman LLC, which is the sole general partner of GP Cayman L.P., which is the sole general partner of HM Equity C.V., which is the sole general partner of PG-IV C.V. PG-IV C.V. is the sole member of PG-IV LLC. Mr. Hicks is also the sole member of Bridge Partners LLC, which is the sole general partner of Bridge Partners L.P., which is the sole member of Bridge LLC. The business address of Mr. Hicks is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Page 22 23 Qualified LLC Qualified LLC is a Delaware limited liability company formed to invest in the Series A 7.5% Convertible Preferred Stock of the Issuer (the "Preferred Stock"). The business address of Qualified LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), information with respect to Equity L.P., the sole member of Qualified LLC, is set forth below. Equity L.P. Equity L.P. is a Texas limited partnership, the principal business of which is to invest directly or indirectly in various companies. The business address of Equity L.P., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to HM4/GP Partners, the sole general partner of Equity L.P., is set forth below. Private LLC Private LLC is a Delaware limited liability company formed to invest in the Preferred Stock. The business address of Private LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Private L.P., the sole member of Private LLC, is set forth below. Private L.P. Private L.P. is a Texas limited partnership, the principal business of which is to invest directly or indirectly in various companies. The business address of Private L.P., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to HM4/GP Partners, the sole general partner of Private L.P., is set forth below. HM4/GP Partners HM4/GP Partners is a Texas limited partnership, the principal business of which is serving as the sole general partner of various limited partnerships whose principal business is to serve as partners in various investment partnerships. The principal business address of HM4/GP Partners, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Hicks GP Partners, the sole general partner of HM4/GP Partners, is set forth below. 4-EQ LLC 4-EQ LLC is a Delaware limited liability company formed to invest in the Preferred Stock. The business address of 4-EQ LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to 4-EQ L.P., the sole member of 4-EQ LLC, is set forth below. 4-EQ L.P. 4-EQ L.P. is a Texas limited partnership, the principal business of which is to invest directly or indirectly in various companies. The business address of 4-EQ L.P., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Hicks GP Partners, the sole general partner of 4-EQ L.P., is set forth below. Page 23 24 4-SBS LLC 4-SBS LLC is a Delaware limited liability company formed to invest in the Preferred Stock. The business address of 4-SBS LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to 4-SBS L.P., the sole member of 4-SBS LLC, is set forth below. 4-SBS L.P. 4-SBS L.P. is a Texas limited partnership, the principal business of which is to invest directly or indirectly in various companies. The business address of 4-SBS L.P., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Hicks GP Partners, the sole general partner of 4-SBS L.P., is set forth below. Hicks GP Partners Hicks GP Partners is a Texas limited partnership, the principal business of which is serving as the sole general partner of various limited partnerships whose principal business is to serve as partners in various investment partnerships. The principal business address of Hicks GP Partners, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Fund IV LLC, the sole general partner of Hicks GP Partners, is set forth below. Fund IV LLC Fund IV LLC is a Texas limited liability company, the principal business of which is serving as the sole general partner in various limited partnerships whose principal business is to serve as partners in various investment partnerships. The business address of Fund IV LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Mr. Thomas O. Hicks, the sole member of Fund IV LLC, is set forth above. PG-IV LLC PG-IV LLC is a Delaware limited liability company formed to invest in the Preferred Stock. The business address of PG-IV LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to PG-IV C.V., the sole member of PG-IV LLC, is set forth below. PG-IV C.V. PG-IV C.V. is a limited partnership organized under the laws of the Netherlands, the principal business of which is to invest directly or indirectly in various companies. The business address of PG-IV C.V., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to HM Equity C.V., the sole general partner of PG-IV C.V., is set forth below. HM Equity C.V. HM Equity C.V. is a limited partnership organized under the laws of the Netherlands, the principal business of which is serving as the sole general partner of various limited partnerships whose principal business is to serve as partners in various investment partnerships. The principal business address of HM Equity C.V., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to GP Cayman L.P., the sole general partner of HM Equity C.V., is set forth below. Page 24 25 GP Cayman L.P. GP Cayman L.P. is a Cayman Islands exempted limited partnership, the principal business of which is serving as the sole general partner of various limited partnerships whose principal business is to serve as partners in various investment partnerships. The business address of GP Cayman L.P., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Fund IV Cayman LLC, the sole general partner of GP Cayman L.P., is set forth below. Fund IV Cayman LLC Fund IV Cayman LLC is an exempted Cayman Islands limited liability company, the principal business of which is serving as the sole general partner in various limited partnerships whose principal business is to serve as partners in various investment partnerships. The business address of Fund IV Cayman LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Mr. Thomas O. Hicks, the sole member of Fund IV Cayman LLC, is set forth above. Bridge LLC Bridge LLC is a Delaware limited liability company formed to invest in the Preferred Stock. The business address of Bridge LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Bridge Partners L.P., the sole member of Bridge LLC, is set forth below. Bridge Partners L.P. Bridge Partners L.P. is a Delaware limited partnership, the principal business of which to invest directly or indirectly in various companies. The business address of Bridge Partners L.P., which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Bridge Partners LLC, the general partner of Bridge Partners L.P., is set forth below. Bridge Partners LLC Bridge Partners LLC is Texas limited liability company, the principal business of which is serving as the sole general partner of various limited partnerships whose principal business is to serve as partners in various investment partnerships. The principal business address of Bridge Partners LLC, which also serves as its principal office, is 200 Crescent Court, Suite 1600, Dallas, Texas 75201-6950. Pursuant to Instruction C to Schedule 13D of the Exchange Act, information with respect to Mr. Thomas O. Hicks, the sole member of Bridge Partners LLC, is set forth above. (d) None of the entities or persons identified in this Item 2 has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) None of the entities or persons identified in this Item 2 has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violations with respect to such laws. (f) Mr. Hicks is a United States citizen. Page 25 26 ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. As more fully described in Item 6 below, on December 3, 1999, Qualified LLC, Private LLC, 4-EQ LLC, 4-SBS LLC, PG-IV LLC and Bridge LLC each purchased from the Issuer the number of shares of Preferred Stock set forth opposite their respective names below at the purchase price set forth opposite their respective names below.
NUMBER OF NAME OF ENTITY SHARES PURCHASED PURCHASE PRICE -------------- ---------------- -------------- Qualified LLC 54,483 $54,483,000 Private LLC 386 $ 386,000 4-EQ LLC 890 $ 890,000 4-SBS LLC 1,340 $ 1,340,000 PG-IV LLC 2,901 $ 2,901,000 Bridge LLC 20,000 $20,000,000
Qualified LLC obtained funds for the purchase price of its shares of Preferred Stock from capital contributions provided by Equity L.P.; Equity L.P. obtained such funds from capital contributions provided by its limited partners and HM4/GP Partners; HM4/GP Partners obtained such funds from capital contributions provided by its limited partners and Hicks GP Partners; and Hicks GP Partners obtained such funds from capital contributions provided by its limited partners and Fund IV LLC. Fund IV LLC obtained such funds from capital contributions provided by Mr. Thomas O. Hicks, who obtained such funds from personal funds. Private LLC obtained funds for the purchase price of its shares of Preferred Stock from capital contributions provided by Private L.P.; Private L.P. obtained such funds from capital contributions provided by its limited partners and HM4/GP Partners; HM4/GP Partners obtained such funds from capital contributions provided by its limited partners and Hicks GP Partners; and Hicks GP Partners obtained such funds from capital contributions provided by its limited partners and Fund IV LLC. Fund IV LLC obtained such funds from capital contributions provided by Mr. Thomas O. Hicks, who obtained such funds from personal funds. 4-EQ LLC obtained funds for the purchase price of its shares of Preferred Stock from capital contributions provided by 4-EQ L.P.; 4-EQ L.P. obtained such funds from capital contributions provided by its limited partners and Hicks GP Partners, and Hicks GP Partners obtained such funds from capital contributions provided by its limited partners and Fund IV LLC. Fund IV LLC obtained such funds from capital contributions provided by Mr. Thomas O. Hicks, who obtained such funds from personal funds. 4-SBS LLC obtained funds for the purchase price of its shares of Preferred Stock from capital contributions provided by 4-SBS L.P.; 4-SBS L.P. obtained such funds from capital contributions provided by its limited partners and Hicks GP Partners, and Hicks GP Partners obtained such funds from capital contributions provided by its limited partners and Fund IV LLC. Fund IV LLC obtained such funds from capital contributions provided by Mr. Thomas O. Hicks, who obtained such funds from personal funds. PG-IV LLC obtained funds for the purchase price of its shares of Preferred Stock from capital contributions provided by PG-IV C.V.; PG-IV C.V. obtained such funds from capital contributions provided by its limited partners and HM Equity C.V.; HM Equity C.V. obtained such funds from capital contributions provided by its limited partners and G.P. Cayman L.P.; and G.P. Cayman L.P. obtained such funds from capital contributions Page 26 27 provided by its limited partners and Fund IV Cayman LLC. Fund IV Cayman LLC obtained such funds from capital contributions provided by Mr. Thomas O. Hicks, who obtained such funds from personal funds. Bridge LLC obtained funds for the purchase price of its shares of Preferred Stock from capital contributions provided by Bridge Partners L.P.; Bridge Partners L.P. obtained $604,493 of such funds from capital contributions provided by its general partner, Bridge Partners LLC, and its limited partners, and it obtained the remainder of the funds, $19,680,507, from a portion of a credit facility from a bank, as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, as amended. Such funds include amounts allocated to fees and expenses. The credit facility expires on January 15, 2000 and Bridge Partners L.P. expects that at or prior to that point such credit facility will be replaced by a new credit facility. Bridge Partners L.P. intends to repay the new credit facility either with funds drawn under another new credit facility or with funds contributed by affiliates of Hicks, Muse. The terms of the credit facility are set forth in the Credit Agreement, a copy of which is filed as Exhibit 10.3 hereto, and is incorporated by reference. Bridge Partners LLC obtained the funds it contributed to Bridge Partners L.P. from capital contributions provided by Mr. Thomas O. Hicks, who obtained such funds from personal funds. ITEM 4. PURPOSE OF THE TRANSACTION. The Reporting Persons consummated the transactions described herein in order to acquire an interest in the Issuer for investment purposes. The Reporting Persons intend to review continuously their position in the Issuer. Depending upon future evaluations of the business prospects of the Issuer and upon other developments, including, but not limited to, general economic and business conditions and stock market conditions, the Reporting Persons may retain or from time to time increase their holdings or dispose of all or a portion of their holdings subject to any applicable legal and contractual restrictions on their ability to do so. In addition, Bridge LLC currently intends to offer to sell some or all of its shares of Preferred Stock to other affiliates of Hicks, Muse. In addition, the matters set forth in Item 6 below are incorporated in this Item 4 by reference as if fully set forth herein. Except as set forth in this Item 4 (including the matters described in Item 6 below which are incorporated in this Item 4 by reference), the Reporting Persons have no present plans or proposals that relate to or that would result in any of the actions specified in clauses (a) through (j) of Item 4 of Schedule 13D of the Exchange Act. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. (a) (1) Qualified LLC is the record and beneficial owner of 54,483 shares of Preferred Stock. Assuming conversion of all such shares, Qualified LLC is the beneficial owner of 1,362,075 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and, as disclosed by the Issuer in the Stock Purchase Agreement, dated as of November 5, 1999 between the Issuer and HMTF-IV Acquisition Corp. ("HMTF-IV") (the "Stock Purchase Agreement"), there being 8,372,805 shares of Common Stock outstanding, represents approximately 14.0% of the outstanding shares of Common Stock. (2) Assuming conversion of all 54,483 shares of Preferred Stock owned of record by Qualified LLC, Equity L.P., in its capacity as sole member of Qualified LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 1,362,075 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 14.0% of the outstanding shares of Common Stock. (3) Private LLC is the record and beneficial owner of 386 shares of Preferred Stock. Assuming conversion of all such shares, Private LLC is the beneficial owner of 9,650 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.1% of the outstanding shares of Common Stock. (4) Assuming conversion of all 386 shares of Preferred Stock owned of record by Private LLC, Private L.P., in its capacity as sole member of Private LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 9,650 shares of Common Stock, which, based on calculations made in Page 27 28 accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.1% of the outstanding shares of Common Stock. (5) Assuming conversion of all 54,869 shares of Preferred Stock owned of record by Qualified LLC and Private LLC, HM4/GP Partners, in its capacity as the sole general partner of each of Equity L.P. and Private L.P., may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 1,371,725 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 14.1% of the outstanding shares of Common Stock. (6) 4-EQ LLC is the record and beneficial owner of 890 shares of Preferred Stock. Assuming conversion of all such shares, 4-EQ LLC is the beneficial owner of 22,250 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.3% of the outstanding shares of Common Stock. (7) Assuming conversion of all 890 shares of Preferred Stock owned of record by 4-EQ LLC, 4-EQ L.P., in its capacity as sole member of 4-EQ LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 22,250 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.3% of the outstanding shares of Common Stock. (8) 4-SBS LLC is the record and beneficial owner of 1,340 shares of Preferred Stock. Assuming conversion of all such shares, 4-SBS LLC is the beneficial owner of 33,500 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.4% of the outstanding shares of Common Stock. (9) Assuming conversion of all 1,340 shares of Preferred Stock owned of record by 4-SBS LLC, 4-SBS L.P., in its capacity as sole member of 4-SBS LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 33,500 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.4% of the outstanding shares of Common Stock. (10) Assuming conversion of all 57,099 shares of Preferred Stock owned of record by Qualified LLC, Private LLC, 4-EQ LLC and 4-SBS LLC, Hicks GP Partners, in its capacity as sole general partner of each of HM4/GP Partners, 4-EQ L.P. and 4-SBS L.P., may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 1,427,475 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 14.6% of the outstanding shares of Common Stock. (11) Assuming conversion of all 57,099 shares of Preferred Stock owned of record by Qualified LLC, Private LLC, 4-EQ LLC and 4-SBS LLC, Fund IV LLC, in its capacity as the sole general partner of Hicks GP Partners, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 1,427,475 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 14.6% of the outstanding shares of Common Stock. (12) PG-IV LLC is the record and beneficial owner of 2,901 shares of Preferred Stock. Assuming conversion of all such shares, PG-IV LLC is the beneficial owner of 72,525 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.9% of the outstanding shares of Common Stock. (13) Assuming conversion of all 2,901 shares of Preferred Stock owned of record by PG-IV LLC, PG-IV C.V., in its capacity as sole member of PG-IV LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 72,525 shares of Common Stock, which, based on calculations made in Page 28 29 accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.9% of the outstanding shares of Common Stock. (14) Assuming conversion of all 2,901 shares of Preferred Stock owned of record by PG-IV LLC, HM Equity C.V., in its capacity as sole general partner of PG-IV C.V., may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 72,525 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.9% of the outstanding shares of Common Stock. (15) Assuming conversion of all 2,901 shares of Preferred Stock owned of record by PG-IV LLC, GP Cayman L.P., in its capacity as sole general partner of HM Equity C.V., may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 72,525 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.9% of the outstanding shares of Common Stock. (16) Assuming conversion of all 2,901 shares of Preferred Stock owned of record by PG-IV LLC, Fund IV Cayman LLC, in its capacity as the sole general partner of GP Cayman L.P. may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 72,525 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 0.9% of the outstanding shares of Common Stock. (17) Bridge LLC is the record and beneficial owner of 20,000 shares of Preferred Stock. Assuming conversion of all such shares, Bridge LLC is the beneficial owner of 500,000 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 5.6% of the outstanding shares of Common Stock. (18) Assuming conversion of all 20,000 shares of Preferred Stock owned of record by Bridge LLC, Bridge Partners L.P., in its capacity as sole member of Bridge LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 500,000 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 5.6% of the outstanding shares of Common Stock. (19) Assuming conversion of all 20,000 shares of Preferred Stock owned of record by Bridge LLC, Bridge Partners LLC, in its capacity as general partner of Bridge Partners L.P., may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 500,000 shares of Common Stock, which, based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 5.6% of the outstanding shares of Common Stock. (20) Assuming conversion of all 80,000 shares of Preferred Stock owned of record by Qualified LLC, Private LLC, 4-EQ LLC, 4-SBS LLC, PG-IV LLC and Bridge LLC, Mr. Thomas O. Hicks, in his capacity as sole member of Fund IV LLC, Fund IV Cayman LLC and Bridge Partners LLC, may, pursuant to Rule 13d-3 of the Exchange Act, be deemed to be the beneficial owner of 2,000,000 shares of Common Stock, which based on calculations made in accordance with Rule 13d-3 of the Exchange Act and there being 8,372,805 shares of Common Stock outstanding, represents approximately 19.3% of the outstanding shares of Common Stock. The Reporting Persons expressly disclaim (a) the existence of any group and (b) beneficial ownership with respect to any shares other than the shares owned of record by such Reporting Person. (b) The information set forth in Items 7 through 11 of the cover pages hereto is incorporated herein by reference. (c) Except as set forth herein, none of the persons named in response to paragraph (a) has effected any transactions in shares of Common Stock during the past 60 days. Page 29 30 (d) The right to receive dividends on, and proceeds from the sale of, the shares of Common Stock which may be beneficially owned by the persons described in (a) and (b) above is governed by the limited liability company agreements and limited partnership agreements of each such entity, and such dividends or proceeds may be distributed with respect to numerous member interests and general and limited partnership interests. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. The matters set forth in Item 2 are incorporated in this Item 6 by reference as if fully set forth herein. Stock Purchase Agreement Pursuant to the Stock Purchase Agreement, the Issuer agreed to sell to HMTF-IV, and HMTF-IV agreed to purchase from the Issuer, 80,000 shares of Preferred Stock for a purchase price of $80,000,000. Prior to the issuance of the shares of Preferred Stock at the Closing (as defined below), pursuant to an Assignment of Rights Under Stock Purchase Agreement dated November 9, 1999 (the "Initial Assignment Agreement"), HMTF-IV assigned all of its rights, titles, interests and obligations in, to and under the Stock Purchase Agreement to Qualified LLC, Private LLC, 4-EQ LLC, 4-SBS LLC and PG-IV LLC (the "Assignees"). Following the execution and delivery of the Initial Assignment Agreement, pursuant to an Assignment of Rights Under Stock Purchase Agreement dated November 16, 1999 (the "Second Assignment Agreement"), each Assignee assigned 25% of its rights, titles, interests and obligations in, to and under the Stock Purchase Agreement to Bridge LLC. In addition, on November 16, 1999, Qualified LLC, Private LLC, 4-EQ LLC, 4-SBS LLC, PG-IV LLC and Bridge LLC entered into an Agreement to be Bound, whereby each entity agreed to be bound by the terms of the Stock Purchase Agreement. On December 3, 1999, at the closing held pursuant to the Stock Purchase Agreement (the "Closing"), the Issuer sold to each of the persons listed below (the "HMTF Holders") the number of shares of Preferred Stock set forth opposite each person's name below in exchange for the purchase price set forth opposite such person's name below.
NUMBER OF NAME OF ENTITY SHARES PURCHASED PURCHASE PRICE -------------- ---------------- -------------- Qualified LLC 54,483 $54,483,000 Private LLC 386 $ 386,000 4-EQ LLC 890 $ 890,000 4-SBS LLC 1,340 $ 1,340,000 PG-IV LLC 2,901 $ 2,901,000 Bridge LLC 20,000 $20,000,000
The foregoing description of the Stock Purchase Agreement is not, and does not purport to be, complete and is qualified in its entirety by reference to the Stock Purchase Agreement, a copy of which is filed herewith as Exhibit 10.1 and is incorporated herein by reference. Registration Rights The Issuer and the holders of the Preferred Stock entered into a Registration Rights Agreement (the "Registration Rights Agreement"), which was attached as Exhibit B to the Stock Purchase Agreement and Page 30 31 incorporated by reference therein. Pursuant to the Registration Rights Agreement, the Issuer agreed to effect three "demand" registrations at the request of the holders of a majority of the Registrable Securities (as defined below) held by the HMTF Holders and any direct or indirect transferee of any Registrable Securities held by the HMTF Holders, who agreed in writing to be bound by certain terms of the Stock Purchase Agreement, provided that each such demand registration must be in respect of Registrable Securities with a fair market value of at least $30,000,000 unless such registration request is for all remaining Registrable Securities, in which case such Registrable Securities shall have a fair market value of at least $5,000,000, and provided that certain other restrictions are met. In addition, the Purchasers have certain piggyback registration rights in connection with registrations of the Issuer's securities under the Securities Act of 1933 (the "Securities Act"). As used in this statement: "Registrable Securities" means (a) the Preferred Stock, (b) the Common Stock issued upon conversion of such Preferred Stock, including any additional shares of Common Stock issued in respect thereof in connection with any stock split, stock dividend or similar event with respect to the Common Stock and (c) any securities that the Issuer or any successor entity into which such Common Stock or such Preferred Stock may be converted or changed. The foregoing description of the Registration Rights Agreement is not, and does not purport to be, complete and is qualified in its entirety by reference to the Registration Rights Agreement, a copy of which is filed as Exhibit B to the Stock Purchase Agreement which Stock Purchase Agreement is filed herewith as Exhibit 10.1 and is incorporated herein by reference. Certificate of Designations As contemplated by the Stock Purchase Agreement, the Board of Directors of the Issuer approved and adopted the Certificate of Designations, Preferences and Rights of Series A 7.5% Convertible Preferred Stock (the "Certificate of Designations") to create the series of Preferred Stock. Under the Certificate of Designations, any class or series of stock of the Issuer, whether now existing or hereafter created, shall be deemed to rank either as to the payment of dividends or other amounts or as to distribution of assets upon liquidation, dissolution (whether voluntary or involuntary) or winding up, or both, (i) prior to the Preferred Stock, if the holders of such class or series are entitled by the terms thereof to the receipt of dividends or other amounts and of amounts distributable upon liquidation, dissolution or winding up, in preference or priority to the holders of Preferred Stock ("Senior Securities"); (ii) on a parity with the Preferred Stock, whether or not the dividend rates, dividend payment dates or redemption or liquidation prices per share thereof be different from those of the Preferred Stock, if the holders of the Preferred Stock and of such class of stock or series shall be entitled by the terms thereof to the receipt of dividends or other amounts or of amounts distributable upon liquidation, dissolution or winding up, or both, in proportion to their respective amounts of accrued and unpaid dividends per share or liquidation preferences (including, but not limited to preferences as to payment of dividends or other amounts distributable upon liquidation), without preference or priority one over the other and such class of stock or series is not a class of Senior Securities; and (iii) junior to the Preferred Stock, if such stock or series shall be Common Stock or if the holders of the Preferred Stock shall be entitled by the terms thereof to receipt of dividends or other amounts, and of amounts distributable upon liquidation, dissolution or winding up, or both, in preference or priority to the holders of shares of such stock or series (including, but not limited to preferences as to payment of dividends or other amounts distributable upon liquidation). The holders of the shares of Preferred Stock will be entitled to receive with respect to each share of Preferred Stock when, as and if declared by the Board of Directors, out of funds legally available for the payment of dividends, dividends at a rate per annum of 7.5% of the Liquidation Preference (as defined below), and an additional amount at a rate per annum of 7.5% of the Special Amount (as defined below) with respect to any share of Preferred Stock (an "Additional Amount"); provided however, that, upon the failure by the Issuer to offer to repurchase the Preferred Stock upon the occurrence of a Change of Control (as defined below), the dividend rate per annum shall increase to 15% of the Liquidation Preference per share and any Additional Amount shall accrue at a rate of 15% of the Special Amount with respect to a share of Preferred Stock, each to be effective retroactively as of the date of the Change of Control (as defined in the Certificate of Designations). Such dividends and Additional Page 31 32 Amounts shall be cumulative from the date of issuance of the Preferred Stock and shall be payable quarterly in arrears. The Issuer may pay current dividends, or dividends or Additional Amounts that have accrued from the last dividend payment date through the date of payment, at its election, in cash or shares of Preferred Stock or any combination thereof. The Issuer may pay accrued dividends (including accrued and unpaid dividends), Additional Amounts (including accrued and unpaid Additional Amounts) and Special Amounts and any dividends accrued thereon only in shares of Preferred Stock. The holders of shares of Preferred Stock will have the right, at any time and from time to time, at such holder's option, to convert any or all their shares of Preferred Stock (and fractional shares), in whole or in part, into fully paid and nonassessable shares of Common Stock equal to the sum of the Liquidation Preference, the Special Amount and an amount equal to all dividends and the Additional Amount accrued thereon from the last dividend payment date to such date, divided by $40, subject to certain adjustments from time to time. The shares of Preferred Stock may be redeemed by the Issuer on or after November 15, 2004. After such date, the Issuer may redeem, at its option, shares of Preferred Stock, at any time in whole or from time to time in part, at a redemption price per share equal to the Liquidation Preference, plus the Special Amount in respect of such share, plus an amount equal to all dividends and the Additional Amount accrued and unpaid thereon from the last dividend payment date to the date fixed for redemption, without interest. Shares of Preferred Stock (if not earlier redeemed or converted) shall be mandatorily redeemed by the Issuer on November 15, 2014, at a redemption price per share in cash equal to the Liquidation Preference, plus the Special Amount in respect of such share, plus an amount equal to all dividends and the Additional Amount accrued and unpaid thereon from the last dividend payment date to such date, without interest. Upon the occurrence of a "Change of Control" (as defined in the Certificate of Designations), prior to the fifth anniversary of the date of issuance of the Preferred Stock, the holders of the Preferred Stock shall be entitled to receive, an amount determined pursuant to a formula set forth in the Certificate of Designations (the "Change of Control Payment"), payable in shares of Preferred Stock, cash or any combination thereof, at the option of the Issuer, on each outstanding share of Preferred Stock. In addition, upon occurrence of a Change of Control, the Issuer shall have the right, but not the obligation, to offer to repurchase the shares of Preferred Stock at a purchase price per share in cash equal to 101% of the Liquidation Preference of each share of Preferred Stock repurchased, plus 101% of the Special Amount in respect of such share (after giving effect to the Change of Control Payment), plus an amount equal to 101% of all dividends and the Additional Amount accrued and unpaid thereon from the last dividend payment date to the date fixed for repurchase. If the Issuer shall elect not to make, or shall fail to make, the offer described above to repurchase the shares of Preferred Stock following the occurrence of a Change of Control, then in addition to the redemption rights that the Issuer may exercise after November 5, 2004, the Issuer shall also have the right (but not the obligation), at any time and from time to time prior to November 5, 2004, to offer to repurchase the shares of Preferred Stock at a purchase price per share in cash equal to 101% of the Liquidation Preference of each share of Preferred Stock repurchased, plus 101% of the Special Amount in respect of such share (after giving effect to the Change of Control Payment to the extent that such payment shall not have been made in cash), plus an amount equal to 101% of all dividends and the Additional Amount accrued and unpaid thereon from the last dividend payment date to the date fixed for repurchase. If a holder of shares of Preferred Stock elects not to, or otherwise fails to, properly tender shares of Preferred Stock pursuant to an offer by the Issuer to repurchase the shares, then (i) with respect to each share of Preferred Stock that such holder fails to tender, the Liquidation Preference, the Special Amount and all dividends and the Additional Amount that have accrued thereon or been paid thereon in shares of Preferred Stock from the effective date of any increase in the dividend rate effected (following the failure of the Issuer to offer to purchase the shares of Preferred Stock upon a Change of Control) through the expiration date of such repurchase offer shall be recalculated as if the dividend rate applicable to each share of Preferred Stock for such period had been 7.5%; (ii) any dividends and any Additional Amount applicable to periods following the expiration of such repurchase offer with respect to each such share shall be computed at a rate of 7.5% per annum; (iii) the amount of dividends and the Additional Amount payable for each full dividend period for the Preferred Stock applicable to periods following the expiration of such repurchase offer shall be computed by dividing 7.5% by four; and (iv) the Page 32 33 special voting provisions provided to the holders of the Preferred Stock upon a Change of Control, voting as a separate class, (including the right to approve a subsequent merger, consolidation, recapitalization or other business combination involving the Issuer or any material subsidiary, a sale of 50% or more of the assets of the Issuer on a consolidated basis and the payment of any cash dividends to holders of or the redemption or repurchase of securities ranked either junior or pari passu with the Preferred Stock) shall terminate on the expiration date of such repurchase offer, in each case subject to reinstatement upon a subsequent Change of Control. The holders of the shares of Preferred Stock will be entitled to vote on all matters that the holders of the Issuer's Common Stock are entitled to vote upon. In exercising these voting rights, each share of Preferred Stock shall be entitled to vote on an as-converted basis with the holders of the Issuer's Common Stock. The approval of the holders of at least a majority of the then-outstanding shares of Preferred Stock, voting as one class, will be required for the Issuer to take certain actions. In addition, for so long as members of the HMTF Group own (A) (i) 50% or more of the shares of Preferred Stock issued to members of the HMTF Group on the Closing Date and any equity securities into which such shares are exchanged or converted, (ii) an amount of Common Stock issued upon conversion of 50% or more of the Preferred Stock issued to members of the HMTF Group on the Closing Date and any equity securities into which such shares are exchanged or converted or (iii) any combination of the Preferred Stock issued to the HMTF Holders on the Closing Date and any shares of Common Stock issued upon conversion of such Preferred Stock that, if taken together, would represent (if all such shares of Preferred Stock were converted) an amount of Common Stock issuable upon conversion of 50% or more of such Preferred Stock, the holders of the HMTF Shares, voting as a class, may elect two directors to serve on the Board of Directors of the Issuer or (B) (i) 25% or more of the shares of Preferred Stock issued to members of the HMTF Group on the Closing Date and any equity securities into which such shares are exchanged or converted, (ii) an amount of Common Stock issued upon conversion of 25% or more of the Preferred Stock issued to members of the HMTF Group on the Closing Date and any equity securities into which such shares are exchanged or converted or (iii) any combination of the Preferred Stock issued to the HMTF Holders on the Closing Date and any shares of Common Stock issued upon conversion of such Preferred Stock that, if taken together, would represent (if all such shares of Preferred Stock were converted) an amount of Common Stock issuable upon conversion of 25% or more of such Preferred Stock, the holders of the HMTF Shares, voting as a class, may elect only one director to serve on the Board of Directors of the Issuer. Pursuant to this right, the HMTF Holders have elected Jack D. Furst and Michael J. Levitt, for election to the board of directors of the Issuer. The Stock Purchase Agreement contains a parallel provision for the election of directors, subject to the same minimum ownership levels, that is inoperative for so long as the above-described provision is in effect. As used in this statement: "HMTF Group" means Hicks, Muse, its affiliates (including the HMTF Holders), HMTF-IV and its affiliates, and their respective officers, directors, partners, members, stockholders and employees (and members of their respective families and trusts for the primary benefit of such family members). "HMTF Shares" means the shares of Preferred Stock issued to the HMTF Holders as of the date of Closing and held by members of the HMTF Group, plus shares of Common Stock issued to and held by members of the HMTF Group upon conversion of such shares of Preferred Stock. "Liquidation Preference" means an amount equal to $1,000 per share of Preferred Stock, subject to change in accordance with the provisions of the Certificate of Designations. "Special Amount" means, with respect of any share of Preferred Stock, all dividends and other amounts which have become payable in respect of such share, and any amounts which have become payable upon a Change of Control, but which have not been paid. The Special Amount with respect to any such share shall be reduced by the amount of any such dividends and other amounts actually paid in respect of such share (including any such amounts paid in shares of Preferred Stock). The foregoing description is not, and does not purport to be, complete and is qualified in its entirety by reference to the Certificate of Designations, a copy of which is filed as Exhibit 10.3 and is incorporated by reference. Page 33 34 ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. Exhibit 10.1: Stock Purchase Agreement, dated as of November 5, 1999, between the Issuer and HMTF-IV, relating to the purchase and sale of Series A 7.5% Convertible Preferred Stock of Globix Corporation (including the Registration Rights Agreement attached as Exhibit B thereto), incorporated herein by reference to Exhibit 4.1 of the Current Report on Form 8-K for Globix Corporation dated November 5, 1999 (File No. 0-25615). Exhibit 10.2: Certificate of Designations, Preferences and Rights of Series A 7.5% Convertible Preferred Stock. Exhibit 10.3: Credit Agreement, dated November 24, 1999, by and among HMTF Bridge Partners, L.P., as Borrower, the Lenders named therein and a bank (as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, as amended), as Administrative Agent. Exhibit 99.1: Joint Filing Agreement among the parties regarding filing of Schedule 13D. Page 34 35 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 * ---------------------------------- Name: Thomas O. Hicks * By: /s/ David W. Knickel -------------------------- Name: David W. Knickel Attorney-in-Fact S-1 36 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM4 GLOBIX QUALIFIED FUND, LLC By: /s/ David W. Knickel ------------------------------- Name: David W. Knickel Title: Vice President S-2 37 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HMTF EQUITY FUND IV (1999), L.P. By: HM4/GP (1999) Partners, L.P., its General Partner By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel ---------------------------------- Name: David W. Knickel Title: Vice President S-3 38 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM4 GLOBIX PRIVATE FUND, LLC By: /s/ David W. Knickel ----------------------------------- Name: David W. Knickel Title: Vice President S-4 39 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HMTF PRIVATE EQUITY FUND IV (1999), L.P. By: HM4/GP (1999) Partners, L.P., its General Partner By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel ---------------------------------- Name: David W. Knickel Title: Vice President S-5 40 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM4/GP (1999) PARTNERS, L.P. By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel ------------------------------- Name: David W. Knickel Title: Vice President S-6 41 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM 4-EQ GLOBIX COINVESTORS, LLC By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President S-7 42 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM 4-EQ (1999) COINVESTORS, L.P. By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President S-8 43 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM 4-SBS GLOBIX COINVESTORS, LLC By: /s/ David W. Knickel ------------------------------- Name: David W. Knickel Title: Vice President S-9 44 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM 4-SBS (1999) COINVESTORS, L.P. By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President S-10 45 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HICKS, MUSE GP (1999) PARTNERS IV, L.P. By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel ----------------------------------- Name: David W. Knickel Title: Vice President S-11 46 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HICKS, MUSE (1999) FUND IV, LLC By: /s/ David W. Knickel ---------------------------------- Name: David W. Knickel Title: Vice President S-12 47 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM PG-IV GLOBIX, LLC By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President S-13 48 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HICKS, MUSE PG-IV (1999), C.V. By: HM Equity Fund IV/GP Partners (1999), C.V., its General Partner By: HM GP Partners IV Cayman, L.P., its General Partner By: HM Fund IV Cayman LLC, its General Partner By: /s/ David W. Knickel ----------------------------- Name: David W. Knickel Title: Vice President S-14 49 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM EQUITY FUND IV/GP PARTNERS (1999), C.V. By: HM GP Partners IV Cayman, L.P., its General Partner By: HM Fund IV Cayman LLC, its General Partner By: /s/ David W. Knickel ----------------------------- Name: David W. Knickel Title: Vice President S-15 50 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM GP PARTNERS IV CAYMAN, L.P. By: HM Fund IV Cayman LLC, its General Partner By: /s/ David W. Knickel ------------------------------- Name: David W. Knickel Title: Vice President S-16 51 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HM FUND IV CAYMAN LLC By: /s/ David W. Knickel ---------------------------- Name: David W. Knickel Title: Vice President S-17 52 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HMTF BRIDGE GLOBIX, LLC By: /s/ David W. Knickel ------------------------------ Name: David W. Knickel Title: Vice President S-18 53 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HMTF BRIDGE PARTNERS, L.P. By: HMTF Bridge Partners, LLC, its General Partner By: /s/ David W. Knickel ------------------------------- Name: David W. Knickel Title: Vice President S-19 54 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. December 10, 1999 HMTF BRIDGE PARTNERS, LLC By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President S-20 55 EXHIBIT INDEX Exhibit 10.1: Stock Purchase Agreement, dated as of November 5, 1999, between the Issuer and HMTF-IV, relating to the purchase and sale of Series A 7.5% Convertible Preferred Stock of Globix Corporation (including the Registration Rights Agreement attached as Exhibit B thereto), incorporated herein by reference to Exhibit 4.1 of the Current Report on Form 8-K for Globix Corporation dated November 5, 1999 (File No. 0-25615). Exhibit 10.2: Certificate of Designations of the Powers, Preferences and Rights of Series A 7.5% Convertible Preferred Stock.* Exhibit 10.3: Credit Agreement, dated November 24, 1999, by and among HMTF Bridge Partners, L.P., as Borrower, the Lenders named therein and a bank (as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, as amended), as Administrative Agent.* Exhibit 99.1: Joint Filing Agreement among the parties regarding filing of Schedule 13D.*
- -------- * Filed herewith. EX-10.2 2 CERTIFICATE OF DESIGNATIONS, PREFERENCES & RIGHTS 1 EXHIBIT 10.2 CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS OF SERIES A 7.5% CONVERTIBLE PREFERRED STOCK of GLOBIX CORPORATION Pursuant to Section 151 of the General Corporation Law of the State of Delaware We, the undersigned, Brian L. Reach, Chief Financial Officer, and Paul Asher, Secretary, of Globix Corporation, a Delaware corporation (hereinafter called the "Corporation"), pursuant to the provisions of Sections 103 and 151 of the General Corporation Law of the State of Delaware, do hereby make this Certificate of Designations and do hereby state and certify that pursuant to the authority expressly vested in the Board of Directors of the Corporation by the Certificate of Incorporation, the Board of Directors duly adopted the following resolutions: RESOLVED, that, pursuant to Article FOURTH of the Certificate of Incorporation (which authorizes 500,000 shares of preferred stock, $.01 par value ("Preferred Stock")), the Board of Directors hereby fixes the powers, designations, preferences and relative, participating, optional and other special rights, and the qualifications, limitations and restrictions, of a series of Preferred Stock. RESOLVED, that each share of such series of Preferred Stock shall rank equally in all respects and shall be subject to the following provisions: 1. Number and Designation. 250,000 shares of the Preferred Stock of the Corporation shall be designated as Series A 7.5% Convertible Preferred Stock (the "Series A Preferred Stock") (including 170,000 shares of Series A Preferred Stock reserved exclusively for the payment of dividends pursuant to paragraph 4). 2. Definitions. Unless the context otherwise requires, when used herein the following terms shall have the meaning indicated. "Affiliate" means, with respect to any specified person, any other person which, directly or indirectly, controls, is controlled by or is under direct or indirect common control with, such specified person. For the purposes of this definition, "control" when used with respect to any person means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the terms "affiliated," "controlling," and "controlled" have meanings correlative to the foregoing. 2 "Board of Directors" means the Board of Directors of the Corporation. "Buyer" means HMTF-IV Acquisition Corp., a Delaware corporation. "Business Day" means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in New York City, New York generally are authorized or required by law or other governmental actions to close. "Capital Stock" means, with respect to any person, any and all shares, interests, participations, rights in, or other equivalents (however designated and whether voting and/or non-voting) of such person's capital stock, whether outstanding on the Issue Date or issued after the Issue Date, and any and all rights (other than any evidence of indebtedness), warrants or options exchangeable for or convertible into such capital stock. "Change of Control" means the occurrence of any of the following events: (a) any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have "beneficial ownership" of all securities that such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of the total Voting Stock of the Corporation; or (b) the Corporation consolidates with, or merges with or into, another person or sells, assigns, conveys, transfers, leases or otherwise disposes of all or substantially all of its assets to any person, or any person consolidates with, or merges with or into the Corporation, in any such event pursuant to a transaction in which either (A) the outstanding Voting Stock of the Corporation is converted into or exchanged for cash, securities or other property, other than any such transaction where (i) the outstanding Voting Stock of the Corporation is converted into or exchanged for Voting Stock of the surviving or transferee corporation or its parent corporation and/or cash, securities or other property in an amount which could be paid by the Corporation under the terms of the Corporation's credit and financing agreements and (ii) immediately after such transaction no "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), is the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have "beneficial ownership" of all securities that such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of the total Voting Stock of the surviving or transferee corporation, as applicable; or (B) the holders of the outstanding Voting Stock of the Corporation immediately prior to such transaction hold less than 50% of the outstanding Voting Stock of the surviving or transferee corporation or its parent corporation immediately after the transaction or (C) during any consecutive two-year period, individuals who at the beginning of such period constituted the Board of Directors (together with any new directors whose election by the Board of Directors or whose nomination for election by the stockholders of the Corporation was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination 2 3 for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office. "Common Stock" means the Corporation's common stock, par value $.01 per share. "Current Market Price" means the average of the daily Market Prices of the Common Stock for ten consecutive trading days immediately preceding the date for which such value is to be computed; provided, however, that (A) if the "ex" date (as hereinafter defined) for any event (other than the issuance or distribution requiring such computation) that requires an adjustment to the Conversion Ratio pursuant to paragraph 8(g)(i), (ii), (iii), (iv), (v) or (vi) occurs during such 10 consecutive trading days, the closing price for each trading day prior to the "ex" date for such other event shall be adjusted by multiplying such closing price by the same fraction by which the Conversion Ratio is so required to be adjusted as a result of such other event, (B) if the "ex" date for any event (other that the issuance or distribution requiring such computation) that requires an adjustment to the Conversion Ratio pursuant to paragraph 8(g)(i), (ii), (iii), (iv), (v) or (vi) occurs on or after the "ex" date for the issuance or distribution requiring such computation and prior to the day in question, the closing price for each trading day on and after the "ex" date for such other event shall be adjusted by multiplying such closing price by the reciprocal of the fraction by which the Conversion Ratio is so required to be adjusted as a result of such other event and (C) if the "ex" date for the issuance or distribution requiring such computation is prior to the day in question, after taking into account any adjustment required pursuant to clause (A) or (B) of this proviso, the closing price for each trading day on or after such "ex" date shall be adjusted by adding thereto the amount of any cash and the fair market value (as determined by the Board of Directors in a manner consistent with any determination of such value for purposes of paragraph 8(g)(iv) or (v), whose determination shall be conclusive and described in a resolution of the Board of Directors) of the evidences of indebtedness, shares of capital stock or assets being distributed applicable to one share of Common Stock as of the close of business on the day before such "ex" date. For purposes of any computation under paragraph 8(g)(vi), the Current Market Price on any date shall be deemed to be the average of the daily closing prices per share of Common Stock for such day and the next two succeeding trading days; provided, however, that, if the "ex" date for any event (other than the tender offer requiring such computation) that requires an adjustment to the Conversion Ratio pursuant to paragraph 8(g)(i), (ii), (iii), (iv), (v) or (vi) occurs on or after the Expiration Time for the tender or exchange offer requiring such computation and prior to the day in question, the closing price for each trading day on and after the "ex" date for such other event shall be adjusted by multiplying such closing price by the reciprocal of the fraction by which the Conversion Ratio is so required to be adjusted as a result of such other event. For purposes of this paragraph, the term "ex" date (1) when used with respect to any issuance or distribution, means the first date on which the shares of Common Stock trade regular way on the relevant exchange or in the relevant market from which the closing price was obtained without the right to receive such issuance or distribution, (2) when used with respect to any subdivision or combination of shares of Common Stock, means the first date on which the shares of Common Stock trade regular way on such exchange 3 4 or in such market after the time at which such subdivision or combination becomes effective and (3) when used with respect to any tender or exchange offer means the first date on which the shares of Common Stock trade regular way on such exchange or in such market after the Expiration Time of such offer. Notwithstanding the foregoing, whenever successive adjustments to the Conversion Ratio are called for pursuant to paragraph 8(g), such adjustments shall be made to the Current Market Price as may be necessary or appropriate to effectuate the intent of paragraph 8(g) and to avoid unjust or inequitable results, as determined in good faith by the Board of Directors. "Exchange Act" means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated thereunder. "Issue Date" means the original date of issuance of shares of Series A Preferred Stock. "Liquidation Preference" is an amount equal to $1,000.00 per share of Series A Preferred Stock. "Market Price" means, with respect to the Common Stock, on any given day, (i) the price of the last trade, as reported on the Nasdaq National Market, not identified as having been reported late to such system, or (ii) if the Common Stock is so traded, but not so quoted, the average of the last bid and ask prices, as those prices are reported on the Nasdaq National Market, or (iii) if the Common Stock is not listed or authorized for trading on the Nasdaq National Market or any comparable system, the average of the closing bid and asked prices as furnished by two members of the National Association of Securities Dealers, Inc. selected from time to time by the Corporation for that purpose. If the Common Stock is not listed and traded in a manner that the quotations referred to above are available for the period required hereunder, the Market Price per share of Common Stock shall be deemed to be the fair value per share of such security as determined in good faith by the Board of Directors of the Corporation. "Special Amount" means, with respect of any share of Series A Preferred Stock, all dividends and other amounts which have become payable in respect of such share under paragraph 4(a), and any amounts which have become payable under paragraph 10, but which have not been paid. The Special Amount with respect to any such share shall be reduced by the amount of any such dividends and other amounts actually paid in respect of such share under paragraph 4(c) (including any such amounts paid in shares of Series A Preferred Stock pursuant to paragraph 4(f)). "Voting Stock" means, with respect to any person, the Capital Stock of any class or kind ordinarily having the power to vote for the election of directors or other members of the governing body of such person. 4 5 3. Rank. (a) Any class or series of stock of the Corporation, whether now existing or hereafter created, shall be deemed to rank: (i) prior to the Series A Preferred Stock, either as to the payment of dividends or other amounts or as to distribution of assets upon liquidation, dissolution (whether voluntary or involuntary) or winding up, or both, if the holders of such class or series shall be entitled by the terms thereof to the receipt of dividends or other amounts and of amounts distributable upon liquidation, dissolution or winding up, in preference or priority to the holders of Series A Preferred Stock ("Senior Securities"); (ii) on a parity with the Series A Preferred Stock, either as to the payment of dividends or other amounts or as to distribution of assets upon liquidation, dissolution (whether voluntary or involuntary) or winding up, or both, whether or not the dividend rates, dividend payment dates or redemption or liquidation prices per share thereof be different from those of the Series A Preferred Stock, if the holders of the Series A Preferred Stock and of such class of stock or series shall be entitled by the terms thereof to the receipt of dividends or other amounts or of amounts distributable upon liquidation, dissolution or winding up, or both, in proportion to their respective amounts of accrued and unpaid dividends per share or liquidation preferences (including, but not limited to preferences as to payment of dividends or other amounts distributable upon liquidation), without preference or priority one over the other and such class of stock or series is not a class of Senior Securities ("Parity Securities"); and (iii) junior to the Series A Preferred Stock, either as to the payment of dividends or as to the distribution of assets upon liquidation, dissolution (whether voluntary or involuntary) or winding up, or both, if such stock or series shall be Common Stock or if the holders of the Series A Preferred Stock shall be entitled by the terms thereof to receipt of dividends or other amounts, and of amounts distributable upon liquidation, dissolution or winding up, or both, in preference or priority to the holders of shares of such stock or series (including, but not limited to preferences as to payment of dividends or other amounts distributable upon liquidation) ("Junior Securities"). (b) The respective definitions of Senior Securities, Junior Securities and Parity Securities shall also include any rights or options exercisable or exchangeable for or convertible into any of the Senior Securities, Junior Securities and Parity Securities, as the case may be. 5 6 (c) The Series A Preferred Stock shall be subject to the creation of Junior Securities. 4. Dividends. (a) The holders of shares of Series A Preferred Stock shall be entitled to receive with respect to each share of Series A Preferred Stock, when, as and if declared by the Board of Directors, out of funds legally available for the payment of dividends, dividends at a rate per annum equal to seven and one-half percent (7.5%) of the Liquidation Preference per share and an additional amount at a rate per annum equal to seven and one-half percent (7.5%) of the Special Amount with respect to any share of Series A Preferred Stock (an "Additional Amount"), to be paid in accordance with the terms of this paragraph 4; provided, however, that, upon the failure by the Corporation to make the Change of Control Offer pursuant to paragraph 11 hereof, the dividend rate per annum shall increase to fifteen percent (15%) of the Liquidation Preference per share and any Additional Amount shall accrue at a rate of fifteen percent (15%) of the Special Amount with respect to a share of Series A Preferred Stock, each to be effective retroactively as of the date of the Change of Control; provided, further, that the dividend and Additional Amount rates shall be subject to further adjustment in accordance with paragraph 12(d) hereof. Such dividends and Additional Amounts shall be cumulative from the Issue Date and shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year (unless such day is not a Business Day, in which event such dividends and Additional Amounts shall be payable on the next succeeding Business Day) (each such date being a "Dividend Payment Date" and each such quarterly period being a "Dividend Period"). Each such dividend and Additional Amount shall be payable to the holders of record of shares of the Series A Preferred Stock as they appear on the share register of the Corporation on the corresponding Record Date. As used herein, the term "Record Date" means, with respect to the dividend payable on March 31, June 30, September 30 and December 31, respectively of each year, the preceding March 15, June 15, September 15 and December 15, or such other record date, not more than 60 days or less than 10 days preceding the payment dates thereof, as shall be fixed by the Board of Directors. (b) The amount of dividends and Additional Amounts payable for each full Dividend Period for the Series A Preferred Stock shall be computed by dividing the annual seven and one-half percent (7.5%) rate by four (4); provided, however, that upon the failure by the Corporation to make the Change of Control Offer pursuant to paragraph 11 hereof, the amount of dividends and Additional Amounts payable for each full Dividend Period shall be computed by dividing the annual fifteen percent (15%) rate by four (4), such rate to be effective retroactively as of the date of the Change of Control; provided, further, that the dividend and Additional Amount rates shall be subject to further adjustment in accordance with paragraph 12(d) hereof. The amount of dividends and Additional Amounts payable for the initial Dividend Period, or any other period shorter or longer than a full Dividend Period, on the Series A Preferred Stock shall be computed on the basis of twelve 30-day months and a 360-day year. Holders of shares of Series A Preferred Stock shall not be entitled to any dividends, whether payable in cash, property or stock, in excess of amounts payable under Section 4(a) hereof (including 6 7 Special Amounts and Additional Amounts), on the Series A Preferred Stock. Except as expressly provided herein, no interest, or sum of money in lieu of interest, shall be payable in respect of any dividend payment or payments on the Series A Preferred Stock that may be in arrears. (c) Special Amounts for any past Dividend Periods may be declared and paid in shares of Series A Preferred Stock on any subsequent Dividend Payment Date, to holders of record on the corresponding Record Date. (d) So long as any shares of the Series A Preferred Stock are outstanding, no dividend, except any dividend paid to effectuate a stock split and except as described in the next succeeding sentence, shall be declared or paid or set apart for payment or other distribution on any Parity Securities, nor shall any Parity Securities be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any shares of any such stock) by the Corporation, directly or indirectly (except by conversion into or exchange for Parity Securities or Junior Securities), unless in each case all Special Amounts have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for such payment on the Series A Preferred Stock for all Dividend Periods terminating on or prior to the date of payment of the dividend on or redemption of such class or series of Parity Securities. When Special Amounts and Additional Amounts are not paid in full or a sum sufficient for such payment is not set apart, as aforesaid, all Special Amounts declared upon shares of the Series A Preferred Stock and all dividends declared upon any other class or series of Parity Securities shall be declared ratably in proportion to the respective amounts of Special Amounts and Additional Amounts accumulated and unpaid on the Series A Preferred Stock and dividends accumulated and unpaid on such Parity Securities. (e) So long as any shares of the Series A Preferred Stock are outstanding, no dividend, (except paid to effectuate a stock split) shall be declared or paid or set apart for payment or other distribution declared or made upon Junior Securities (other than under a shareholders' right plan), nor shall any Junior Securities be redeemed, purchased or otherwise acquired (other than a redemption, purchase or other acquisition of shares of Common Stock made for purposes of an employee incentive or benefit plan of the Corporation or any subsidiary) (any such dividend, distribution, redemption or purchase being hereinafter referred to as a "Junior Securities Distribution") for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any shares of any such stock) by the Corporation, directly or indirectly (except by conversion into or exchange for Junior Securities), unless in each case (i) all Special Amounts on all outstanding shares of the Series A Preferred Stock and accrued and unpaid dividends on any other Parity Securities shall have been paid or set apart for payment for all past Dividend Periods with respect to the Series A Preferred Stock and all past dividend periods with respect to such Parity Securities and (ii) sufficient funds shall 7 8 have been paid or set apart for the payment of the dividend and Additional Amount for the current Dividend Period with respect to the Series A Preferred Stock and the current dividend period with respect to any Parity Securities. (f) The Corporation may pay current dividends, or dividends or Additional Amounts that have accrued from the last Dividend Payment Date through the date of payment, at its election, in cash or shares of Series A Preferred Stock or any combination thereof. The Corporation may pay accrued dividends (including accrued and unpaid dividends), Additional Amounts (including accrued and unpaid Additional Amounts) and Special Amounts and any dividends accrued thereon only in shares of Series A Preferred Stock. The number of shares of Series A Preferred Stock to be issued in circumstances when dividends, Additional Amounts or Special Amounts are paid with additional shares of Series A Preferred Stock will equal the cash amount of the dividend, Additional Amount or Special Amount, if any, payable (but for the operation of this Section 4(f)), divided by the Liquidation Preference, rounded to the nearest full share, up or down, after taking into account all shares of Series A Preferred Stock owned by the holder thereof, provided that if the resulting fractional share held by such holder equals one-half or more of a share of Series A Preferred Stock, such fractional share shall be rounded up to the nearest full share. 5. Liquidation Preference. (a) In the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, before any payment or distribution of the assets of the Corporation (whether capital or surplus) shall be made to or set apart for the holders of Junior Securities, the holders of the shares of Series A Preferred Stock shall be entitled to receive with respect to each share of Series A Preferred Stock an amount in cash equal to the Liquidation Preference, plus the Special Amount in respect of such share, plus an amount equal to all dividends and the Additional Amount accrued and unpaid thereon from the last Dividend Payment Date to the date of final distribution to such holders, but such holders shall not be entitled to any further payment. If, upon any liquidation, dissolution or winding up of the Corporation, the assets of the Corporation, or proceeds thereof, shall be insufficient to pay in full the preferential amount aforesaid and liquidating payments on all Parity Securities, then such assets, or the proceeds thereof, shall be distributed among the holders of shares of Series A Preferred Stock and all such other Parity Securities ratably in accordance with the respective amounts that would be payable on such shares of Preferred Stock and any such other Parity Securities if all amounts payable thereon were paid in full. For the purposes of this paragraph 5, (i) a consolidation or merger of the Corporation with one or more corporations, or (ii) a sale or transfer of all or substantially all of the Corporation's assets, shall not be deemed to be a liquidation, dissolution or winding up, voluntary or involuntary, of the Corporation. (b) Subject to the rights of the holders of any Parity Securities, after payment shall have been made in full to the holders of the Series A Preferred Stock, as provided in this paragraph 5, any other series or class or classes of Junior Securities shall, subject to the respective terms and provisions (if any) applying thereto, be entitled to 8 9 receive any and all assets remaining to be paid or distributed, and the holders of the Series A Preferred Stock and any Parity Securities shall not be entitled to share therein. 6. Redemption. (a) The Series A Preferred Stock shall be redeemable by the Corporation on or after November 15, 2004. After such date, to the extent the Corporation shall have funds legally available for such payment, the Corporation may redeem at its option shares of Series A Preferred Stock, at any time in whole or from time to time in part, at a redemption price per share equal to the Liquidation Preference, plus the Special Amount in respect of such share, plus an amount equal to all dividends and the Additional Amount accrued and unpaid thereon from the last Dividend Payment Date to the date fixed for redemption, without interest. (b) To the extent the Corporation shall have funds legally available for such payment, on November 15, 2014, the Corporation shall redeem all outstanding shares of the Series A Preferred Stock, if any, at a redemption price per share in cash equal to the Liquidation Preference, plus the Special Amount in respect of such share, plus an amount equal to all dividends and the Additional Amount accrued and unpaid thereon from the last Dividend Payment Date to such date, without interest. (c) Shares of Series A Preferred Stock which have been issued and reacquired in any manner, including shares purchased or redeemed, shall (upon compliance with any applicable provisions of the laws of the State of Delaware) have the status of authorized and unissued shares of the class of Preferred Stock undesignated as to series and may be predesignated and reissued as part of any series of the Preferred Stock; provided that no such issued and reacquired shares of Series A Preferred Stock shall be reissued or sold as Series A Preferred Stock. (d) If the Corporation is unable or shall fail to discharge its obligation to redeem all outstanding shares of Series A Preferred Stock pursuant to paragraph 6(b) (the "Mandatory Redemption Obligation"), the Mandatory Redemption Obligation shall be discharged as soon as the Corporation is able to discharge such Mandatory Redemption Obligation. If and so long as any Mandatory Redemption Obligation with respect to the Series A Preferred Stock shall not be fully discharged, the Corporation shall not (i) directly or indirectly, redeem, purchase, or otherwise acquire any Parity Security or discharge any mandatory or optional redemption, sinking fund or other similar obligation in respect of any Parity Securities (except in connection with a redemption, sinking fund or other similar obligation to be satisfied pro rata with the Series A Preferred Stock) or (ii) declare or make any Junior Securities Distribution, or, directly or indirectly, discharge any mandatory or optional redemption, sinking fund or other similar obligation in respect of any Junior Securities. 9 10 7. Procedure for Redemption. (a) In the event that fewer than all the outstanding shares of Series A Preferred Stock are to be redeemed, the number of shares to be redeemed shall be determined by the Board of Directors and the shares to be redeemed shall be selected pro rata (with any fractional shares being rounded to the nearest whole share). (b) In the event the Corporation shall redeem shares of Series A Preferred Stock, notice of such redemption shall be given by first class mail, postage prepaid mailed not less than 30 days nor more than 60 days prior to the redemption date, to each holder of record of the shares to be redeemed at such holder's address as the same appears on the stock register of the Corporation; provided that neither the failure to give such notice nor any defect therein shall affect the validity of the giving of notice for the redemption of any share of Series A Preferred Stock to be redeemed except as to the holder to whom the Corporation has failed to give said notice or except as to the holder whose notice was defective. Each such notice shall state: (i) the redemption date; (ii) the number of shares of Series A Preferred Stock to be redeemed and, if fewer than all the shares held by such holder are to be redeemed, the number of shares to be redeemed from such holder; (iii) the redemption price; (iv) the place or places where certificates for such shares are to be surrendered for payment of the redemption price; (v) the then current Conversion Ratio; and (vi) that dividends and Additional Amounts on the shares to be redeemed will cease to accrue on such redemption date. (c) Notice having been mailed as aforesaid, from and after the redemption date, dividends and Additional Amounts on the shares of Series A Preferred Stock so called for redemption shall cease to accrue, said shares shall no longer be deemed outstanding, and all rights of the holders thereof as stockholders of the Corporation (except the right to receive from the Corporation the redemption price) shall cease. Upon surrender in accordance with said notice of the certificates for any shares so redeemed (properly endorsed or assigned for transfer, if the Board of Directors of the Corporation shall so require and the notice shall so state), such shares shall be redeemed by the Corporation at the redemption price aforesaid. In case fewer than all the shares represented by any such certificate are redeemed, a new certificate shall be issued representing the unredeemed shares without cost to the holder thereof. The Corporation's obligation to provide moneys in accordance with this Section 7(c) shall be deemed fulfilled if, on or before the applicable redemption date, the Corporation shall deposit with a bank or trust company having an office or agency in the Borough of Manhattan, City of New York, and having a combined capital and surplus of at least $1,000,000,000 in funds necessary for such redemption, in trust, with irrevocable instructions that such funds be applied to the redemption of the shares of Series A Preferred Stock so called for redemption. Any interest accrued on such funds shall be paid to the Corporation from time to time. Any funds so deposited to which holders of Series A Preferred Stock are lawfully entitled but which are unclaimed at the end of two years from such redemption date shall be released or repaid to the Corporation, after which, subject to any applicable laws relating to escheat or unclaimed property, the holder or holders of such shares of 10 11 Series A Preferred Stock so called for redemption shall look only to the Corporation for payment of the applicable redemption price. The election by the Corporation to redeem shares of Series A Preferred Stock shall become irrevocable only on the redemption date included in the relevant notice. (d) Notwithstanding anything to the contrary contained herein, if the Corporation's notice of redemption has been given pursuant to this Section 7 and any holder of shares of Series A Preferred Stock shall, prior to the close of business on the third Business Day immediately preceding the redemption date, give written notice to the Corporation of the conversion of any and all of the shares to be redeemed held by such holder (accompanied by a certificate or certificates for such shares, duly endorsed or assigned to the Corporation), then such shares shall not be redeemed and the conversion of such shares to be redeemed shall become effective as provided in Section 8. 8. Conversion. (a) Subject to the provisions of this paragraph 8, the holders of the shares of Series A Preferred Stock shall have the right, at any time and from time to time, at such holder's option, to convert any or all outstanding shares (and fractional shares) of Series A Preferred Stock, in whole or in part, into fully paid and non-assessable shares of Common Stock. The number of shares of Common Stock deliverable upon conversion of a share of Series A Preferred Stock, adjusted as hereinafter provided, is referred to herein as the "Conversion Ratio." The Conversion Ratio as of any date shall be an amount equal to the sum of (i) the Liquidation Preference, (ii) the Special Amount and (iii) an amount equal to all dividends and the Additional Amount accrued thereon from the last Dividend Payment Date to such date, divided by $40, subject to adjustment from time to time pursuant to paragraph 8(g) hereof. Notwithstanding any call for redemption pursuant to paragraph 6, the right to convert shares so called for redemption shall terminate at the close of business on the third Business Day immediately preceding the date fixed for such redemption unless the Corporation shall default in making payment of the amount payable upon such redemption. (b) (i) In order to exercise the conversion privilege, the holder of the shares of Series A Preferred Stock to be converted shall surrender the certificate representing such shares at the office of the Corporation, with a written notice of election to convert completed and signed, specifying the number of shares to be converted. Unless the shares issuable on conversion are to be issued in the same name as the name in which such shares of Series A Preferred Stock are registered, each share surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Corporation, duly executed by the holder or the holder's duly authorized attorney, and an amount sufficient to pay any transfer or similar tax. (ii) As promptly as practicable after the surrender by the holder of the certificates for shares of Series A Preferred Stock as aforesaid, the Corporation shall issue and shall deliver to such holder, or on the holder's written order to the holder's transferee, (y) a certificate or certificates for 11 12 the whole number of shares of Common Stock issuable upon the conversion of such shares in accordance with the provisions of this paragraph 8, any cash adjustment required pursuant to Section 8(f), and (z) in the event of a conversion in part, a certificate or certificates for the whole number of shares of Series A Preferred Stock not being so converted. (iii) Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for shares of Series A Preferred Stock shall have been surrendered and such notice received by the Corporation as aforesaid, and the person in whose name or names any certificate or certificates for shares of Common Stock shall be issuable upon such conversion shall be deemed to have become the holder of record of the shares of Common Stock represented thereby at such time on such date and such conversion shall be into a number of whole shares of Common Stock equal to the product of the number of shares of Series A Preferred Stock surrendered times the Conversion Ratio in effect at such time on such date. All shares of Common Stock delivered upon conversion of the Series A Preferred Stock will upon delivery be duly and validly issued and fully paid and non- assessable, free of all liens and charges and not subject to any preemptive rights. Upon the surrender of certificates representing the shares of Series A Preferred Stock to be converted, the shares to be so converted shall no longer be deemed to be outstanding and all rights of a holder with respect to such shares surrendered for conversion shall immediately terminate except the right to receive the Common Stock and other amounts payable pursuant to this paragraph 8 and a certificate or certificates representing the shares of Series A Preferred Stock not converted. (c) (i) Upon delivery to the Corporation by a holder of shares of Series A Preferred Stock of a notice of election to convert, the right of the Corporation to redeem such shares of Series A Preferred Stock shall terminate, regardless of whether a notice of redemption has been mailed as aforesaid. (ii) If a holder of Series A Preferred Stock delivers to the Corporation a notice of election to convert, the Series A Preferred Stock to be converted shall cease to accrue dividends and Additional Amounts pursuant to paragraph 4 but shall continue to be entitled to receive pro rata dividends and Additional Amounts for the period from the last Dividend Payment Date to the date of delivery of the notice of election to convert in preference to and in priority over any dividends on any Junior Securities. (iii) Except as provided above and in paragraph 8(g), the Corporation shall make no payment or adjustment for accrued and unpaid 12 13 dividends or Additional Amounts on shares of Series A Preferred Stock, whether or not in arrears, on conversion of such shares or for dividends in cash on the shares of Common Stock issued upon such conversion. (d) (i) The Corporation covenants that it will at all times reserve and keep available, free from preemptive rights, such number of its authorized but unissued shares of Common Stock as shall be required for the purpose of effecting conversions of the Series A Preferred Stock. (ii) Prior to the delivery of any securities which the Corporation shall be obligated to deliver upon conversion of the Series A Preferred Stock, the Corporation shall comply with all applicable federal and state laws and regulations which require action to be taken by the Corporation. (e) The Corporation will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of shares of Common Stock on conversion of the Series A Preferred Stock pursuant hereto; provided that the Corporation shall not be required to pay any tax which may be payable in respect of any transfer involved in the issue or delivery of shares of Common Stock in a name other than that of the holder of the Series A Preferred Stock to be converted and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax has been paid. (f) In connection with the conversion by a holder of any shares of Series A Preferred Stock, no fractions of shares of Common Stock shall be required to be issued to such holder, but in lieu thereof the Corporation shall pay a cash adjustment in respect of such fractional interest in an amount equal to such fractional interest multiplied by the Market Price per share of Common Stock on the Business Day on which such shares of Series A Preferred Stock are deemed to have been converted. (g) (i) In case the Corporation shall at any time after the date of issue of the Series A Preferred Stock (A) declare a dividend or make a distribution on Common Stock payable in Common Stock, (B) subdivide or split the outstanding Common Stock, (C) combine or reclassify the outstanding Common Stock into a smaller number of shares, (D) issue any shares of its Capital Stock in a reclassification of Common Stock (including any such reclassification in connection with a consolidation or merger in which the Corporation is the continuing corporation), or (E) consolidate with, or merge with or into, any other Person, the Conversion Ratio in effect at the time of the record date for such dividend or distribution or of the effective date of such subdivision, split, combination, consolidation, merger or reclassification shall be proportionately adjusted so that the conversion of the Series A Preferred Stock after such time shall entitle the holder to receive the aggregate number of shares of Common Stock or other 13 14 securities of the Corporation (or shares of any security into which such shares of Common Stock have been combined, consolidated, merged or reclassified pursuant to clause 8 (g)(i)(C) , 8 (g)(i)(D) or 8(g)(i)(E) above) which, if this Series A Preferred Stock had been converted immediately prior to such time, such holder would have owned upon such conversion and been entitled to receive by virtue of such dividend, distribution, subdivision, split, combination, consolidation, merger or reclassification assuming such holder of Common Stock of the Corporation (x) is not a Person with which the Corporation consolidated or into which the Corporation merged or which merged into the Corporation or to which such recapitalization, sale or transfer was made, as the case may be ("constituent person"), or an affiliate of a constituent person and (y) failed to exercise any rights of election as to the kind or amount of securities, cash and other property receivable upon such reclassification, change, consolidation, merger, recapitalization, sale or transfer (provided, that if the kind or amount of securities, cash and other property receivable upon such reclassification, change, consolidation, merger, recapitalization, sale or transfer is not the same for each share of Common Stock of the Corporation held immediately prior to such reclassification, change, consolidation, merger, recapitalization, sale or transfer by other than a constituent person or an affiliate thereof and in respect of which such rights of election shall not have been exercised ("non-electing share"), then for the purpose of this subparagraph 8(g) the kind and amount of securities, cash and other property receivable upon such reclassification, change, consolidation, merger, recapitalization, sale or transfer by each non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). Such adjustment shall be made successively whenever any event listed above shall occur. (ii) In case the Corporation shall issue or sell any Common Stock (other than Common Stock issued (A) pursuant to the Corporation's existing or future stock option plans or pursuant to any other existing or future Common Stock-related director or employee compensation plan of the Corporation approved by the Board of Directors, (B) as consideration for the acquisition of a business or of assets, (C) in a firmly committed underwritten public offering when either (i) the underwriting discount is less than 5%, or (ii) the offering price per share is greater than the Conversion Price, (D) to the Corporation's joint venture partners in exchange for interests in the relevant joint venture, or (E) upon exercise or conversion of any security the issuance of which caused an adjustment under paragraph 8(g)(i) or 8(g)(iii) hereof or the issuance of which did not require adjustment hereunder) without consideration or for a consideration per share less than the Current Market Price on the date of such issuance, or shall issue securities convertible into Common Stock having a conversion price per share less than the Current Market Price at the date of issuance of such convertible security, the Conversion Ratio to be in effect after such issuance or sale shall be determined by multiplying the Conversion Ratio in effect immediately prior to such issuance or sale by a fraction, (1) the 14 15 numerator of which shall be the sum of the number of shares of Common Stock outstanding immediately prior to such issuance or sale and the number of additional shares of Common Stock to be issued or sold (or, in the case of convertible securities, issued on conversion), and (2) the denominator of which shall be the sum of (x) the number of shares of Common Stock outstanding immediately prior to such issuance or sale and (y) the number of shares of Common Stock which the aggregate consideration receivable by the Corporation for the total number of additional shares of Common Stock so issued or sold (or issuable on conversion) would purchase at the Current Market Price in effect immediately prior to such issuance or sale. In case any portion of the consideration to be received by the Corporation shall be in a form other than cash, the fair market value of such noncash consideration shall be utilized in the foregoing computation. Such fair market value shall be determined in good faith by the Board of Directors. (iii) In case the Corporation shall fix a record date for the issuance of rights, options or warrants (other than rights, options or warrants issued (A) pursuant to the Corporation's existing or future stock option plans or pursuant to any other existing or future Common Stock- related director or employee compensation plan of the Corporation approved by the Board of Directors, (B) as consideration for the acquisition of a business or of assets, (C) in a firmly committed underwritten public offering when either (i) the underwriting discount is less than 5%, or (ii) the offering price per share is greater than the Conversion Price, (D) to the Corporation's joint venture partners in exchange for interests in the relevant joint venture, or (E) upon exercise or conversion of any security the issuance of which caused an adjustment under paragraph 8(g)(i) or 8(g)(ii) hereof or the issuance of which did not require adjustment hereunder) to the holders of its Common Stock or other securities entitling such holders to subscribe for or purchase shares of Common Stock (or securities convertible into shares of Common Stock) at a price per share of Common Stock (or having a conversion price per share of Common Stock, if a security convertible into shares of Common Stock) less than the Current Market Price on such record date, the maximum number of shares of Common Stock issuable upon exercise of such rights, options or warrants (or conversion of such convertible securities) shall be deemed to have been issued and outstanding as of such record date and the Conversion Ratio shall be adjusted pursuant to paragraph 8(g)(ii) hereof, as though such maximum number of shares of Common Stock had been so issued for an aggregate consideration payable by the holders of such rights, options, warrants or convertible securities prior to their receipt of such shares of Common Stock. In case any portion of such consideration shall be in a 15 16 form other than cash, the fair market value of such noncash consideration shall be determined as set forth in paragraph 8(g)(ii) hereof. Such adjustment shall be made successively whenever such record date is fixed; and in the event that such rights, options or warrants are not so issued or expire in whole or in part unexercised, or in the event of a change in the number of shares of Common Stock to which the holders of such rights, options or warrants are entitled (other than pursuant to adjustment provisions therein comparable to those contained in this paragraph 8(g)), the Conversion Ratio shall again be adjusted as follows: (A) in the event that all of such rights, options or warrants expire unexercised, the Conversion Ratio shall be the Conversion Ratio that would then be in effect if such record date had not been fixed; (B) in the event that less than all of such rights, options or warrants expire unexercised, the Conversion Ratio shall be adjusted pursuant to paragraph 8(g)(ii) to reverse the adjustment with respect to rights, options or warrants that have lapsed or expired unexercised; and (C) in the event of a change in the number of shares of Common Stock to which the holders of such rights, options or warrants are entitled, the Conversion Ratio shall be adjusted to reflect the Conversion Ratio which would then be in effect if such holder had initially been entitled to such changed number of shares of Common Stock. Notwithstanding anything herein to the contrary, no further adjustment to the Conversion Ratio shall be made upon the issuance or sale of Common Stock upon the exercise of any rights, options or warrants to subscribe for or purchase Common Stock, if any adjustment in the Conversion Ratio was made or required to be made upon the record date for the issuance or sale of such rights, options or warrants under this clause 8(g)(iii). Rights or warrants distributed by the Corporation to holders of shares of Common Stock entitling the holders thereof to subscribe for or purchase shares of the Corporation's capital stock (either initially or under certain circumstances), which rights or warrants, until the occurrence of a specified event or events ("Dilution Trigger Event"): (A) are deemed to be transferred with such shares of Common Stock; (B) are not exercisable; and (C) are also issued in respect of future issuances of shares of Common Stock, shall be deemed not to have been distributed for purposes of this paragraph 8 (g)(iii) (and no adjustment to the Conversion Ratio under this paragraph 8(g)(iii) shall be required) until the occurrence of the earliest Dilution Trigger Event, whereupon such rights and warrants shall be deemed to have been distributed and an appropriate adjustment to the Conversion Ratio under this paragraph 8 (g)(iii) shall be made. If any such rights or warrants, including any such existing rights or warrants distributed prior to the first issuance of shares of Series A Preferred Stock, are subject to subsequent events, upon the occurrence of each of which 16 17 such rights or warrants shall become exercisable to purchase different securities, evidences of indebtedness or other assets, then the occurrence of each such event shall be deemed to be such date of issuance and record date with respect to new rights or warrants (and a termination or expiration of the existing rights or warrants, without exercise by the holder thereof). In addition, in the event of any distribution (or deemed distribution) of rights or warrants, or any Dilution Trigger Event with respect thereto, that was counted for purposes of calculating a distribution amount for which an adjustment to the Conversion Ratio under this paragraph 8(g)(iii) was made, (1) in the case of any such rights or warrants which shall have been redeemed or repurchased without exercise by any holders thereof, the Conversion Ratio shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Dilution Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder or holders of shares of Common Stock with respect to such rights or warrants (assuming such holder had retained such rights or warrants), made to all holders of shares of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights or warrants which shall have expired or been terminated without exercise by any holders thereof, the Conversion Ratio shall be readjusted as if such rights and warrants had not been issued. (iv) In case the Corporation shall fix a record date for the making of a distribution to holders of Common Stock (including any such distribution made in connection with a consolidation or merger in which the Corporation is the continuing corporation) of evidences of indebtedness, assets or other property (other than (x) dividends payable in Common Stock or rights, options or warrants referred to in paragraph 8(g)(i) or 8(g)(iii) hereof for which an adjustment was made, (y) dividends paid solely in cash, or (z) distributions of stock or assets having an aggregate fair market value of less than $7.5 million on a cumulative basis), the Conversion Ratio to be in effect after such record date shall be determined by multiplying the Conversion Ratio in effect immediately prior to such record date by a fraction, (A) the numerator of which shall be the Current Market Price on such record date, and (B) the denominator of which shall be the Current Market Price on such record date, less the fair market value (determined as set forth in paragraph 8 (g)(ii) hereof) of the portion of the assets, other property or evidence of indebtedness so to be distributed which is applicable to one share of Common Stock. Such adjustments shall be made successively whenever such a record date is fixed; and in the event that such distribution is not so made, the Conversion Ratio shall 17 18 again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed. For purposes of this paragraph 8(g)(iv) and paragraph 8(g)(i) and 8(g)(iii), any dividend or distribution to which this paragraph 8(g)(iv) is applicable that also includes shares of Common Stock, or rights or warrants to subscribe for or purchase shares of Common Stock to which paragraph 8(g)(i) or 8(g)(iii) applies (or both) shall be deemed instead to be (A) a dividend or distribution of the evidences of indebtedness, assets, shares of capital stock, rights or warrants other than such shares of Common Stock or rights or warrants to which paragraph 8(g)(i) or 8(g)(iii) applies (and any Conversion Ratio adjustment required by this paragraph 8(g)(iv) with respect to such dividend or distribution shall then be made) immediately followed by (B) a dividend or distribution of such shares of Common Stock or such rights or warrants (and any further Conversion Ratio adjustment required by paragraph 8(g)(i) or 8(g)(iii) with respect to such dividend or distribution shall then be made). (v) If the Corporation shall, by dividend or otherwise, distribute to holders of its shares of Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which paragraph 8(h) applies or as part of a distribution referred to in paragraph 8(g)(iv)) in an aggregate amount that, combined together with (A) the aggregate amount of any other such distributions to holders of its shares of Common Stock made exclusively in cash within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this paragraph 8(g)(v) has been made, and (B) the aggregate of any cash plus the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) of consideration payable in respect of any tender offer by the Corporation for all or any portion of the shares of Common Stock concluded within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to paragraph 8(vi) has been made, exceeds 5% of the Corporation's consolidated net income for the preceding fiscal year then, and in each such case, immediately after the close of business on such date, the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the close of business on such record date by a fraction and (1) the numerator of which shall be equal to the Current Market Price on such record date; (2) the denominator of which shall be equal to the Current Market Price on the record date less an amount equal to the quotient of (x) the excess of such combined amount over 5% of the Corporation's consoli- 18 19 dated net income for the preceding fiscal year and (y) the number of shares of Common Stock outstanding on the record date; provided, however, that, if the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price of the shares of Common Stock on the record date, in lieu of the foregoing adjustment, adequate provision shall be made so that each holder of shares of Series A Preferred Stock shall have the right to receive upon conversion of a shares of Series A Preferred Stock (or any portion thereof) the amount of cash such holder would have received had such holder converted such share of Series A Preferred Stock (or portion thereof) immediately prior to such record date. If such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not been declared. (vi) If a tender offer made by the Corporation or any of its Subsidiaries for all or any portion of the Common Stock expires and such tender offer (as amended upon the expiration thereof) requires the payment to shareholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares) of an aggregate consideration having a fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that, combined together with (A) the aggregate of the cash plus the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors), as of the expiration of such tender offer, of consideration payable in respect of any other tender offers, by the Corporation or any of its Subsidiaries for all or any portion of the shares of Common Stock expiring within the 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph 8(g)(vi) has been made and (B) the aggregate amount of any distributions to all holders of the Common Stock made exclusively in cash within 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to paragraph 8(g)(v) has been made, exceeds 5% of the Corporation's consolidated net income for the preceding fiscal year, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Ratio shall be adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the close of business on the date of the Expiration Time by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders based on the acceptance (up to any maximum specified in the 19 20 terms of the tender offer) of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to any such maximum, being referred to as the "Purchased Shares") and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares) at the Expiration Time and the Current Market Price of the shares of Common Stock on the trading day next succeeding the Expiration Time and the denominator shall be the number of shares of Common Stock outstanding (including any tendered shares) at the Expiration Time multiplied by the Current Market Price of the shares of Common Stock on the trading day next succeeding the Expiration Time, such adjustment (if any) to become effective immediately prior to the opening of business on the day following the Expiration Time. If the Corporation is obligated to purchase shares pursuant to any such tender offer, but the Corporation is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such tender offer had not been made. If the application of this paragraph 8(g)(vi) to any tender offer would result in a decrease in the Conversion Ratio, no adjustment shall be made for such tender offer under this paragraph 8(g)(vi). (vii) In the event that, at any time as a result of the provisions of this paragraph 8(g), a holder of Series A Preferred Stock upon subsequent conversion shall become entitled to receive any shares of Capital Stock of the Corporation other than Common Stock, the number of such other shares so receivable upon conversion of Series A Preferred Stock shall thereafter be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions contained herein. (h) Subject to paragraph 9 hereof, in case of any consolidation of the Corporation with, or merger of the Corporation into, any other corporation, or in case of any merger of another corporation into the Corporation (other than a merger which does not result in any reclassification, conversion, exchange or cancellation of outstanding shares of Common Stock of the Corporation), or in case of any sale, conveyance or transfer of 50% or more of the assets of the Corporation, the holder of each share of Series A Preferred Stock then outstanding shall have the right thereafter, during the period such share of Series A Preferred Stock shall be convertible as specified in Paragraph 8(a), to convert such share of Series A Preferred Stock only into the kind and amount of securities, cash and other property receivable upon such consolidation, merger, conveyance or transfer by a holder of the number of shares of shares of Common Stock of the Corporation into which such share of Series A Preferred Stock might have been converted immediately prior to such consolidation, merger, conveyance or transfer, 20 21 assuming such holder of shares of Common Stock of the Corporation failed to exercise his rights of election, if any, as to the kind or amount of securities, cash and other property receivable upon such consolidation, merger, conveyance or transfer (provided that, if the kind or amount of securities, cash and other property receivable upon such consolidation, merger, conveyance or transfer is not the same for each Common Share of the Corporation in respect of which such rights of election shall not have been exercised ("nonelecting share"), then for the purpose of this paragraph 8 the kind and amount of securities, cash and other property receivable upon such consolidation, merger, conveyance or transfer by each nonelecting share shall be deemed to be the kind and amount so receivable per share by a plurality of the nonelecting shares). Such securities shall provide for adjustments which, for events subsequent to the effective date of the triggering event, shall be as nearly equivalent as may be practicable to the adjustments provided for in this paragraph 8. The above provisions of this paragraph 8 shall similarly apply to successive consolidations, mergers, conveyance or transfers. (i) In case: (i) the Corporation shall declare a dividend (or any other distribution) on its Common Stock payable otherwise than in cash out of its earned surplus; or (ii) the Corporation shall authorize the granting to all holders of its shares of Common Stock of rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any other rights; or (iii) of any reclassification of the Common Stock (other than a subdivision or combination of the Corporation's outstanding shares of Common Stock), or of any consolidation or merger to which the Corporation is a party and for which approval of any shareholders of the Corporation is required, or the sale, conveyance or transfer of all or substantially all the assets of the Corporation; or (iv) of the voluntary or involuntary dissolution, liquidation or winding-up of the Corporation; then the Corporation shall cause to be filed with the Registrar and at each office or agency maintained for the purpose of conversion of shares of Series A Preferred Stock, and shall cause to be mailed to all holders at their last addresses as they shall appear in the shares of a Series A Preferred Stock Register, at least 20 Business Days (or 10 Business Days in any case specified in clause (i) or (ii) above) prior to the applicable date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, rights or warrants, or, if a record is not to be taken, the date as of which the holders of shares of Common Stock of record to be entitled to 21 22 such dividend, distribution, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up is expected to become effective, and the date as of which it is expected that holders of shares of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up. Failure to give the notice required by this paragraph 8(i) or any defect therein shall not affect the legality or validity of any dividend, distribution, right, warrant, reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up, or the vote upon any such action. (j) All adjustments pursuant to this paragraph 8 shall be notified to the holders of the Series A Preferred Stock and such notice shall be accompanied by a schedule of computations of the adjustments. 9. Voting Rights. (a) The holders of record of shares of Series A Preferred Stock shall not be entitled to any voting rights except as hereinafter provided in this paragraph 9 or as otherwise provided by law. (b) Each share of Series A Preferred Stock shall entitle the holder thereof to vote on all matters that the holders of Common Stock are entitled to vote upon on at a meeting of stockholders of the Corporation, except that with respect to the election of directors of the Corporation, except as set forth in clause (c) below, the shares of Series A Preferred Stock shall automatically be voted in the same proportion as the votes of the holders of Common Stock. With respect to any such vote, each share of Series A Preferred Stock shall entitle the holder thereof to cast the number of votes equal to the number of votes which could be cast by in such vote by a holder of the shares of Common Stock into which such share of Series A Preferred Stock is convertible on the record date for such vote or, if no such record date is established, on the date any written consent of stockholders is solicited. (c) For so long as members of the HMTF Group own (A) either (i) 50% or more of the shares of Series A Preferred Stock issued to members of the HMTF Group on the Closing Date under the Stock Purchase Agreement dated as of November 5, 1999 (together with any equity securities into which such shares are exchanged or converted, the "HMTF Issued Series A Preferred Shares"), (ii) an amount of Common Stock issued upon conversion of 50% or more of the HMTF Issued Series A Preferred Shares or (iii) any combination of HMTF Issued Series A Preferred Shares and Common Stock issued upon conversion of HMTF Issued Series A Preferred Shares that, if taken together, would represent (if all HMTF Issued Series A Preferred Shares were converted) an amount of Common Stock issuable upon conversion of 50% or more of the HMTF Issued Series A Preferred Shares, the number of directors then constituting the Board of Directors shall be increased by two and the HMTF Holders, voting as a single 22 23 class, shall be entitled to elect the two additional directors (the "Buyer Directors") to serve on the Board of Directors at any annual meeting of stockholders or special meeting held in place thereof, or at a special meeting of the HMTF Holders called as hereinafter provided, or (B) either (i) 25% or more of (but less than 50% of) the HMTF Issued Series A Preferred Shares", (ii) an amount of Common Stock issued upon conversion of 25% or more of (but less than 50% of) the HMTF Issued Series A Preferred Shares or (iii) any combination of HMTF Issued Series A Preferred Shares and Common Stock issued upon conversion of HMTF Issued Series A Preferred Shares that, if taken together, would represent (if all HMTF Issued Series A Preferred Shares were converted) an amount of Common Stock issuable upon conversion of 25% or more of (but less than 50% of) the HMTF Issued Series A Preferred Shares, the HMTF Holders, voting as a single class, shall be entitled to elect only one additional Buyer Director to serve on the Board of Directors at any annual meeting of stockholders or special meeting held in place thereof, or at a special meeting of the HMTF Holders called as hereinafter provided. At any time after voting power to elect a director shall have become vested and be continuing in the HMTF Holders pursuant to this paragraph, or if a vacancy shall exist in the office of a director elected by the HMTF Holders, a proper officer of the Corporation may, upon the written request of the holders of record of at least fifty percent (50%) of the HMTF Issued Series A Preferred Shares then outstanding held by the HMTF Holders addressed to the Secretary of the Corporation, call a special meeting of the HMTF Holders for the purpose of electing the additional Buyer Director that such holders are entitled to elect. If such meeting shall not be called by a proper officer of the Corporation within twenty (20) days after personal service of said written request upon the Secretary of the Corporation, or within twenty (20) days after mailing the same within the United States by certified mail, addressed to the Secretary of the Corporation at its principal executive offices, then the holders of at least fifty percent (50%) of the HMTF Issued Series A Preferred Shares then outstanding held by the HMTF Holders may designate in writing one of their number to call such meeting at the expense of the Corporation, and such meeting may be called by the person so designated upon the notice required for the annual meeting of stockholders of the Corporation and shall be held at the place for holding the annual meetings of stockholders. Any holder of HMTF Issued Series A Preferred Shares so designated shall have, and the Corporation shall provide, access to the lists of stockholders to be called pursuant to the provisions hereof. In the event the HMTF Group loses the right to nominate one or more Buyer Directors pursuant to the first sentence of this paragraph 9(c), then the HMTF Group shall direct one or more Buyer Directors to tender his resignation (which resignation need not be accepted by the board of directors). "HMTF Group" means Hicks, Muse, Tate & Furst Incorporated, a Texas corporation, and its Affiliates, the Buyer and its Affiliates, and their respective officers, directors, partners, members, stockholders and employees (and members, stockholders and employees (and members of their respective families and trusts for the primary benefit of such family members), and "HMTF Holders" shall mean the members of the HMTF Group holding HMTF Issued Series A Preferred Shares or the Common Stock into which such shares are converted. 23 24 (d) In the event the HMTF Group elects to have the Board of Directors appoint the Buyer Directors (in lieu of following the procedures for direct election set forth in paragraph 9(c)) it shall so notify the Corporation in writing and the Corporation shall (i) increase the size of the Board of Directors by two and fill the vacancies created thereby by electing the Buyer Directors and (ii) in connection with the meeting of shareholders of the Corporation next following such election, nominate such Buyer Directors for election as directors by the stockholders and use its best efforts to cause the Buyer Directors to be so elected. If a vacancy shall exist in the office of a Buyer Director, the HMTF Group shall be entitled to designate a successor and the Board of Directors shall elect such successor and, in connection with the meeting of stockholders of the Corporation next following such election, nominate such successor for election as director by the stockholders and use its best efforts to cause the successor to be so elected. (e) If the Corporation shall have failed to discharge its Mandatory Redemption Obligation, the number of directors then constituting the Board of Directors shall be increased by one (in addition to any directors appointed or elected pursuant to paragraph 9(c) or (d) hereof) and the HMTF Holders, voting as a single class, shall be entitled to elect the additional director to serve on the Board of Directors at any annual meeting of stockholders or special meeting held in place thereof, or at a special meeting of the HMTF Holders called as hereinafter provided. Whenever the Corporation shall have fulfilled its Mandatory Redemption Obligation, then the right of the HMTF Holders to elect such additional director shall cease and the term of office of any person so elected as director by the HMTF Holders shall forthwith terminate and the number of the Board of Directors shall be reduced accordingly. (f) Without the written consent of holders of a majority of the outstanding HTMF Issued Series A Preferred Shares or the vote of holders of a majority of the outstanding HTMF Issued Series A Preferred Shares at a meeting of the holders of Series A Preferred Stock called for such purpose, the Corporation will not amend, alter or repeal any provision of the Certificate of Incorporation or this Certificate of Designations so as to adversely affect the preferences (including, without limitation, liquidation preferences, conversion price, dividend rate and preferences and Optional Redemption provisions), rights or powers of the Series A Preferred Stock or to authorize the issuance or sale of any additional shares of Series A Preferred Stock; provided that any such amendment that changes any dividend or other amount payable on or the liquidation preference of the Series A Preferred Stock shall require the written consent of holders of two-thirds of the outstanding HTMF Issued Series A Preferred Shares or the vote of holders of two-thirds of the outstanding HTMF Issued Series A Preferred Shares at a meeting of the holders of HTMF Issued Series A Preferred Shares called for such purpose. 24 25 (g) Without the written consent of holders of a majority of the outstanding HTMF Issued Series A Preferred Shares or the vote of holders of a majority of the outstanding HTMF Issued Series A Preferred Shares at a meeting of such holders called for such purpose, the Corporation will not create, authorize or issue any Senior Securities or Parity Securities. (h) Without the written consent of holders of a majority of the outstanding HTMF Issued Series A Preferred Shares or the vote of holders of a majority of the outstanding HTMF Issued Series A Preferred Shares at a meeting of the holders of HMTF Issued Series A Preferred Shares called for such purpose, the Corporation shall not, in a single transaction or series of related transactions, consolidate or merge with or into, or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its assets to, any person or adopt a plan of liquidation unless: either (1) the Corporation is the surviving or continuing person and the Series A Preferred Stock shall remain outstanding without any amendment that would adversely affect the preferences, rights or powers of the Series A Preferred Stock or (2) (i) the person (if other than the Corporation) formed by such consolidation or into which the Corporation is merged or the person which acquires by conveyance, transfer or lease the properties and assets of the Corporation substantially as an entirety or in the case of a plan of liquidation, the person to which assets of the Corporation have been transferred, shall be a corporation, partnership or trust organized and existing under the laws of the United States or any State thereof or the District of Columbia and (ii) the Series A Preferred Stock shall be converted into or exchanged for and shall become shares of such successor, transferee or resulting person, having in respect of such successor, transferee or resulting person, the same powers, preferences and relative participating, optional or other special rights and the qualifications, limitations or restrictions thereon, that the Series A Preferred Stock had immediately prior to such transaction. For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of related transactions) of all or substantially all of the properties or assets of one or more subsidiaries of the Corporation, the Capital Stock of which constitutes all or substantially all of the properties and assets of the Corporation, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Corporation. (i) In exercising the voting rights set forth in this paragraph 9, except as otherwise provided in paragraph 9(b), each share of Series A Preferred Stock shall have one vote per share, except that when any other series of preferred stock shall have the right to vote with the Series A Preferred Stock as a single class on any matter, then the Series A Preferred Stock shall have with respect to such matters one vote per $1,000 (or fraction thereof) of the aggregate Liquidation Preference plus Special Amounts. Except as otherwise required by applicable law or as set forth herein, the shares of Series A Preferred Stock shall not have any relative, participating, optional or other special voting rights and powers and the consent of the holders thereof shall not be required for the taking of any corporate action. 25 26 (j) Upon the occurrence of a Change of Control if the Corporation shall have failed to make the Change of Control Offer in accordance with paragraph 11 hereof, thereafter, but subject to the provisions of paragraph 12(d) hereof, the consent of the holders of a majority of the shares of the HMTF Issued Series A Preferred Shares, voting as a separate class, shall also be required to approve (i) any subsequent merger, consolidation, recapitalization or other business combination involving the Corporation or any material subsidiary, (ii) a sale of 50% or more of the assets of the Corporation on a consolidated basis, and (iii) the payment of any cash dividends to holders of, or the redemption or repurchase of, Pari Passu Securities or Junior Securities. 10. Change of Control Payment. Notwithstanding anything to the contrary contained in paragraph 4(b) hereof, upon the occurrence of a Change of Control prior to the fifth anniversary of the Issue Date of the Series A Preferred Stock, the Corporation shall pay, and the holders of the shares of Series A Preferred Stock shall be entitled to receive, an amount (the "Change of Control Payment") payable in shares of Series A Preferred Stock, cash or any combination thereof, at the option of the Corporation, on each outstanding share of Series A Preferred Stock, equal to the excess of (1) the amount that the sum of the Special Amount and the Additional Amount on one share of Series A Preferred Stock would be if (i) such share had been outstanding from the date of original issuance of the Series A Preferred Stock to the fifth anniversary of the date of original issuance of the Series A Preferred Stock and no dividends had been declared and paid on such share and (ii) such fifth anniversary was a Dividend Payment Date (such that the accumulated dividends thereon would have been added to the Special Amount thereof) over (2) the amount of the actual sum of the Special Amount and the Additional Amount of such outstanding share of Series A Preferred Stock on the Change of Control date plus the amount of any dividends previously received (i.e. declared and paid) thereon. The Change of Control Payment shall not affect (i) the right of the holders of shares of Series A Preferred Stock to convert such shares pursuant to paragraph 8 hereof, (ii) the continued accrual of dividends pursuant to paragraph 4(a) on the outstanding shares of Series A Preferred Stock during such five-year period or thereafter, (iii) except as expressly set forth in this subparagraph 10, any other provision hereof relating to the payment of dividends or (iv) the provisions of paragraph 9, paragraph 11 or paragraph 12 hereof. Notwithstanding the foregoing, the Change of Control Payment payable pursuant to this paragraph 10 shall be subject to the following limitations: (1) Upon a Change of Control on or prior to the second anniversary of the date of the initial issuance of the Series A Preferred Stock, the aggregate Change of Control Payment shall not exceed the amount of shares or cash necessary to ensure that if all of the shares of Series A Preferred Stock then outstanding were converted or redeemed for cash on such date, the holders of such Series A Preferred Stock would receive aggregate consideration upon such conversion or redemption with a fair market value determined as set forth in paragraph 8(g)(ii) hereof of no less than the product of (i) three (3), multiplied by (ii) the aggregate 26 27 Liquidation Preference on the date of the Change of Control of all outstanding shares of Series A Preferred Stock. (2) Upon a Change of Control after the second anniversary, but on or prior to the third anniversary, of the date of the initial issuance of the Series A Preferred Stock, the aggregate Change of Control Payment shall not exceed the amount of shares or cash necessary to ensure that if all of the shares of Series A Preferred Stock then outstanding were converted or redeemed for cash on such date, the holders of such Series A Preferred Stock would receive aggregate consideration upon such conversion or redemption with a fair market value determined as set forth in paragraph 8(g) (ii) hereof of no less than the product of (i) four (4), multiplied by (ii) the aggregate Liquidation Preference on the date of the Change of Control of all outstanding shares of Series A Preferred Stock. (3) Upon a Change of Control after the third anniversary, but on or prior to the fourth anniversary of, the date of the initial issuance of the Series A Preferred Stock, the aggregate Change of Control Payment shall not exceed the amount of shares or cash necessary to ensure that if all of the shares of Series A Preferred Stock then outstanding were converted or redeemed for cash on such date, the holders of such Series A Preferred Stock would receive aggregate consideration upon such conversion or redemption with a fair market value determined as set forth in paragraph 8(g) (ii) hereof of no less than the product of (i) five (5), multiplied by (ii) the aggregate Liquidation Preference on the date of the Change of Control of all outstanding shares of Series A Preferred Stock. (4) Upon a Change of Control after the fourth anniversary, but prior to the fifth anniversary of, the date of the initial issuance of the Series A Preferred Stock, the aggregate Change of Control Payment shall not exceed the amount of shares or cash necessary to ensure that if all of the shares of Series A Preferred Stock then outstanding were converted or redeemed for cash on such date, the holders of such Series A Preferred Stock would receive aggregate consideration upon such conversion or redemption with a fair market value determined as set forth in paragraph 8(g)(ii) hereof of no less than the product of (i) six (6), multiplied by (ii) the aggregate Liquidation Preference on the date of the Change of Control of all outstanding shares of Series A Preferred Stock. (5) The Corporation shall have the right to institute reasonable procedures in order to implement this paragraph 10 (as well as paragraphs 11 and 12 hereof) and, to the extent reasonably practicable, will make proper provision prior to the date of any Change of Control to ensure that the holders of shares of Series A Preferred Stock will be entitled to receive the benefits intended to be afforded by this paragraph 10. 27 28 11. Change of Control Offer. (a) Upon the occurrence of a Change of Control, the Corporation shall have the right, but not the obligation, to offer (the "Change of Control Offer") to repurchase the shares of Series A Preferred Stock at a purchase price per share in cash equal to 101% of the Liquidation Preference of each share of Series A Preferred Stock repurchased, plus 101% of the Special Amount in respect of such share (after giving effect to the Change of Control Payment), plus an amount equal to 101% of all dividends and the Additional Amount accrued and unpaid thereon from the last Dividend Payment Date to the date fixed for repurchase (the "Change of Control Purchase Amount"). Within 20 days following any Change of Control, the Corporation shall mail a notice to each holder of shares of Series A Preferred Stock (with a copy to the Registrar) describing the transaction or transactions that constitute the Change of Control and, if the Corporation so elects, offering to repurchase shares of Series A Preferred Stock on a date specified in such notice (the "Change of Control Purchase Date"), which date shall be no earlier than 90 days and no later than 120 days from the date such notice is mailed, pursuant to the procedures required by Section 6 and described in such notice. The failure of the Corporation to make such Change of Control Offer within such 20-day period shall constitute an irrevocable waiver of the Corporation's right to make such Change of Control Offer solely with the respect to the relevant Change of Control and shall result in the increased dividend rate referred to in paragraph 4 (a) hereof and the special voting rights referred to in 9(j) hereof becoming applicable effective as of the date of the Change of Control. The Corporation shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations to the extent such laws and regulations are applicable in connection with the repurchase of the Series A Preferred Stock as a result of a Change of Control. (b) On the Change of Control Purchase Date, the Corporation shall, to the extent lawful: (1) accept for payment all shares of Series A Preferred Stock properly tendered pursuant to the Change of Control Offer; (2) deposit with the paying agent an amount equal to the Change of Control Purchase Amount in respect of all shares of Series A Preferred Stock so tendered; and (3) deliver or cause to be delivered to the Registrar all certificates for shares of Series A Preferred Stock so accepted together with an officer's certificate stating the aggregate number of shares being purchased by the Corporation. (c) The paying agent shall promptly mail to each holder of shares of Series A Preferred Stock so tendered the Change of Control Purchase Amount for such 28 29 shares of Series A Preferred Stock, and the Registrar shall promptly authenticate and mail (or cause to be transferred by book entry) to each holder a new certificate for any shares of Series A Preferred Stock not tendered that are represented by the surrendered certificate. The Corporation shall notify each holder of Series A Preferred Stock the results of the Change of Control Offer on or as soon as practicable after the Change of Control Purchase Date. (d) The provisions of this paragraph that permit the Corporation to make a Change of Control Offer shall be applicable regardless of whether any other provisions of this certificate are applicable. Except as set forth in this paragraph, no holder of shares of Series A Preferred Stock shall have any right to require the Corporation to repurchase or redeem the shares of Series A Preferred Stock in the event of a takeover, recapitalization or other similar transaction. 12. Purchase Offer. (a) If the Corporation shall elect not to make, or shall fail to make, the Change of Control Offer following the occurrence of a Change of Control pursuant to paragraph 11 hereof within the 20-day period specified therein, then in addition to the redemption rights that the Corporation may exercise pursuant to paragraph 6 hereof after November 5, 2004, the Corporation shall also have the right (but not the obligation), at any time and from time to time prior to November 5, 2004, to offer (the "Purchase Offer") to repurchase the shares of Series A Preferred Stock at a purchase price per share in cash equal to 101% of the Liquidation Preference of each share of Series A Preferred Stock repurchased, plus 101% of the Special Amount in respect of such share (after giving effect to the Change of Control Payment to the extent that such payment shall not have been made in cash), plus an amount equal to 101% of all dividends and the Additional Amount accrued and unpaid thereon from the last Dividend Payment Date to the date fixed for repurchase (the "Purchase Payment"). If the Corporation elects to make a Purchase Offer, the Corporation shall mail a notice to each holder of shares of Series A Preferred Stock (with a copy to the Registrar) offering to repurchase shares of Series A Preferred Stock on a date specified in such notice (the "Purchase Payment Date"), which date shall be no earlier than 90 days and no later than 120 days from the date such notice is mailed, pursuant to the procedures required by Section 6 and described in such notice. The Corporation shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations to the extent such laws and regulations are applicable in connection with the repurchase of the Series A Preferred Stock hereunder. (b) On the Purchase Payment Date, the Corporation shall, to the extent lawful: 29 30 (1) accept for payment all shares of Series A Preferred Stock properly tendered pursuant to the Purchase Offer; (2) deposit with the paying agent an amount equal to the Purchase Payment in respect of all shares of Series A Preferred Stock so tendered; and (3) deliver or cause to be delivered to the Registrar all certificates for shares of Series A Preferred Stock so accepted together with an officer's certificate stating the aggregate number of shares being purchased by the Company. (c) The paying agent shall promptly mail to each holder of shares of Series A Preferred Stock so tendered the Purchase Payment for such shares of Series A Preferred Stock, and the Registrar shall promptly authenticate and mail (or cause to be transferred by book entry) to each such holder a new certificate for any shares of Series A Preferred Stock not tendered that are represented by the surrendered certificate. The Corporation shall notify the holders of Series A Preferred Stock the results of the Purchase Offer on or as soon as practicable after the Purchase Payment Date. (d) If a holder of shares of Series A Preferred Stock elects not to, or otherwise fails to, properly tender shares of Series A Preferred Stock into the Purchase Offer, then (i) with respect to each share of Series A Preferred Stock that such holder fails to tender, the Liquidation Preference, the Special Amount and all dividends and the Additional Amount that have accrued thereon or been paid thereon in shares of Series A Preferred Stock from the effective date of any increase in the dividend rate effected pursuant to paragraph 4 (following the failure of the Company to make the Change of Control Offer) through the expiration date of the Purchase Offer made pursuant to paragraph 12 shall be recalculated as if the dividend rate applicable to each share of Series A Preferred Stock for such period had been seven and one-half percent (7.5%); (ii) any dividends and any Additional Amount applicable to periods following the expiration of the Purchase Offer with respect to each such share shall be computed at a rate of seven and one-half percent (7.5%) per annum; (iii) the amount of dividends and the Additional Amount payable for each full Dividend Period for the Series A Preferred Stock applicable to periods following the expiration of the Purchase Offer shall be computed by dividing seven and one-half percent (7.5%) by four (4); and (iv) the special voting provisions provided in paragraph 9(j) shall terminate on the expiration date of the Purchase Offer, in each case subject to reinstatement upon a subsequent Change of Control. Nothing in this paragraph 12(d) shall affect the Change of Control Payment received pursuant to paragraph 10. 13. Limitation and Rights Upon Insolvency. Notwithstanding any other provision of this Certificate of Designations, the Corporation shall not be required to pay any dividend on, or to pay any amount in respect of any redemption of, the Series A Preferred Stock at a time when immediately after making such payment the Corporation is or would be rendered 30 31 insolvent (as defined by applicable law), provided that the obligation of the Corporation to make any such payment shall not be extinguished in the event the foregoing limitation applies. 14. Reports. So long as any of the Series A Preferred Stock is outstanding, in the event the Corporation is not required to file quarterly and annual financial reports with the Securities and Exchange Commission pursuant to Section 13 or Section 15(d) of the Exchange Act, the Corporation will furnish the holders of the Series A Preferred Stock with reports containing the same information as would be required in such reports. 15. Notice. Except as may otherwise be provided for herein, all notices referred to herein shall be in writing, and all notices hereunder shall be deemed to have been given upon, the earlier of receipt of such notice or three Business Days after the mailing of such notice if sent by registered mail (unless first-class mail shall be specifically permitted for such notice under the terms of this Certificate of Designations) with postage prepaid, addressed: if to the Corporation to Globix Corporation, 139 Centre Street, New York, New York, 10012, Attention: Chief Financial Officer, or to an agent of the Corporation designated as permitted by the Certificate of Incorporation or, if to any holder of the Series A Preferred Stock, to such holder at the address of such holder of the Series A Preferred Stock as listed in the stock record books of the Corporation; or to such other address as the Corporation or holder, as the case may be, shall have designated by notice similarly given. 16. General Provisions. (a) The term "Person" as used herein means any corporation, limited liability company, partnership, trust, organization, association, other entity or individual. (b) The term "outstanding", when used with reference to shares of stock, shall mean issued shares, excluding shares held by the Corporation or a subsidiary. (c) The headings of the paragraphs, subparagraphs, clauses and subclauses of this Certificate of Designations are for convenience of reference only and shall not define, limit or affect any of the provisions hereof. (d) Each holder of shares of Series A Preferred Stock, by acceptance thereof, acknowledges and agrees that payments of dividends, interest, premium and principal on, and exchange, redemption and repurchase of, such securities by the Corporation are subject to restrictions on the Corporation contained in certain credit and financing agreements. 31 32 IN WITNESS WHEREOF, Globix Corporation has caused this Certificate of Designations to be signed and attested by the undersigned this 3rd day of December, 1999. GLOBIX CORPORATION By: /s/ BRIAN L. REACH -------------------------------- Name: Brian L. Reach Title: Chief Financial Officer By: /s/ PAUL ASHER -------------------------------- Name: Paul Asher Title: Secretary EX-10.3 3 CREDIT AGREEMENT DATED NOVEMBER 24, 1999 1 EXHIBIT 10.3 CREDIT AGREEMENT dated as of November 24, 1999 among HMTF Bridge Partners, L.P., The Lenders Parties Hereto, and [A bank, as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, as amended] as Administrative Agent $110,000,000.00 TERM LOAN FACILITY 2 TABLE OF CONTENTS
Page ---- ARTICLE 1 Definitions..............................................................................................1 SECTION 1.1 Defined Terms..........................................................................1 SECTION 1.2 Terms Generally........................................................................9 SECTION 1.3 Accounting Terms; GAAP.................................................................9 ARTICLE 2 Term Loans..............................................................................................10 SECTION 2.1 Term Loans..........................................................................10 SECTION 2.2 Procedure for Term Loan Borrowing...................................................10 SECTION 2.3 Repayment of Loans; Evidence of Debt; etc...........................................10 SECTION 2.4 Termination and Reduction of Commitments............................................11 SECTION 2.5 Prepayments.........................................................................11 SECTION 2.6 Conversion and Continuation Options.................................................12 SECTION 2.7 Minimum Amounts and Maximum Number of Tranches......................................13 SECTION 2.8 Interest............................................................................13 SECTION 2.9 Fees................................................................................13 SECTION 2.10 Inability to Determine Interest Rate................................................14 SECTION 2.11 Pro Rata Treatment and Payments.....................................................14 SECTION 2.12 Requirements of Law.................................................................15 SECTION 2.13 Taxes...............................................................................16 SECTION 2.14 Indemnity...........................................................................17 SECTION 2.15 Change of Lending Office............................................................18 SECTION 2.16 Replacement of Lenders..............................................................18 ARTICLE 3 Representations and Warranties..........................................................................18 SECTION 3.1 Organization; Powers................................................................18 SECTION 3.2 Authorization; Enforceability.......................................................19 SECTION 3.3 Governmental Approvals; No Conflicts................................................19 SECTION 3.4 Compliance with Laws and Agreements.................................................19 SECTION 3.5 Investment and Holding Company Status...............................................19 SECTION 3.6 Material Adverse Effect.............................................................19 SECTION 3.7 No Material Litigation..............................................................19 SECTION 3.8 Disclosure..........................................................................19 SECTION 3.9 Investments.........................................................................20 ARTICLE 4 Conditions Precedent....................................................................................20 SECTION 4.1 ............................................................................................20 (a) Loan Documents............................................................................20 (b) Closing Certificate.......................................................................20 (c) Legal Opinion.............................................................................20 (d) Approvals.................................................................................20
3 (e) Fees......................................................................................21 (f) Filings...................................................................................21 SECTION 4.2 Additional Conditions for Each Credit Event.........................................21 (a) Pledge Agreement..........................................................................21 (b) Representations and Warranties............................................................21 (c) No Default................................................................................21 (d) Certificate...............................................................................21 (e) Co-Investment.............................................................................21 (f) Legal Opinion.............................................................................22 (g) Management and Advisory Agreements........................................................22 (h) Investment................................................................................22 ARTICLE 5 Covenants...............................................................................................22 SECTION 5.1 Notices of Material Events..........................................................22 SECTION 5.2 Existence; Conduct of Business......................................................22 SECTION 5.3 Payment of Obligations..............................................................22 SECTION 5.4 Compliance with Laws................................................................23 SECTION 5.5 Use of Proceeds.....................................................................23 SECTION 5.6 Additional Collateral...............................................................23 SECTION 5.7 Financial Reporting.................................................................23 SECTION 5.8 Additional Guarantors...............................................................23 ARTICLE 6 Negative Covenants......................................................................................24 SECTION 6.1 Indebtedness........................................................................24 SECTION 6.2 Liens...............................................................................24 SECTION 6.3 Fundamental Changes.................................................................24 SECTION 6.4 Restricted Payments.................................................................24 SECTION 6.5 Sale of Assets......................................................................24 ARTICLE 7 Events of Default.......................................................................................25 ARTICLE 8 The Administrative Agent................................................................................27 ARTICLE 9 Miscellaneous...........................................................................................28 SECTION 9.1 Notices.............................................................................28 SECTION 9.2 Waivers; Amendments.................................................................29 SECTION 9.3 Expenses; Indemnity; Damage Waiver..................................................29 SECTION 9.4 Successors and Assigns..............................................................30 SECTION 9.5 Survival............................................................................32 SECTION 9.6 Counterparts; Integration; Effectiveness............................................32 SECTION 9.7 Severability........................................................................32
4 SECTION 9.8 Right of Setoff.....................................................................32 SECTION 9.9 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS .........................................................................32 SECTION 9.10 WAIVER OF JURY TRIAL................................................................33 SECTION 9.11 Headings............................................................................33 SECTION 9.12 Confidentiality.....................................................................33 SECTION 9.13 Syndication.........................................................................34
SCHEDULE: Schedule 2.1 -- Commitments EXHIBITS: Exhibit A -- Form of Assignment and Acceptance Exhibit B -- Form of Opinion of Counsel Exhibit C -- Form of Closing Certificate Exhibit D -- Form of Affiliate Guarantee Exhibit E -- Form of Note Exhibit F -- Form of Pledge Agreement Exhibit G -- Form of Hicks Muse Letter Agreement Exhibit H -- Form of Principal Agreement 5 1 CREDIT AGREEMENT, dated as of November 24, 1999, among HMTF Bridge Partners, L.P., the Lenders parties hereto from time to time and [a bank, as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, as amended (the "Bank")], as Administrative Agent. The parties hereto agree as follows: ARTICLE 1 Definitions SECTION 1.1 Defined Terms. As used in this Agreement, the following terms have the meanings specified below: "ABR Loans" means Term Loans the rate of interest applicable to which is based upon the Alternate Base Rate. "Additional Lenders" has the meaning set forth in Section 9.13. "Administrative Agent" means [Bank], in its capacity as administrative agent for the Lenders hereunder. "Affiliate" means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. "Affiliate Guarantees" means the collective reference to each guarantee agreement executed and delivered by a Guarantor, substantially in the form of Exhibit D, as the same may be amended, supplemented or otherwise modified from time to time. "Agreement" means this Credit Agreement, as amended, supplemented or otherwise modified from time to time. "Alternate Base Rate" means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Base CD Rate in effect on such day plus 1% and (c) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate shall be effective from and including the effective date of such change in the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate, respectively. "Applicable Margin" means a per annum rate equal to (a) 2.50% in the case of Eurodollar Loans and (b) 1.50% in the case of ABR Loans. "Assessment Rate" means, for any day, the annual assessment rate in effect on such day that is payable by a member of the Bank Insurance Fund classified as "well-capitalized" and within supervisory subgroup "B" (or a comparable successor risk classification) within the meaning of 12 C.F.R. Part 327 (or any successor provision) to the Federal Deposit Insurance Corporation for insurance by such Corporation of time deposits made in dollars at the offices of such member in the United States; provided that if, as a result of any change in any law, rule or regulation, it is no longer possible to determine the Assessment Rate as aforesaid, then the Assessment Rate shall be such annual rate as shall be determined in good faith by the Administrative Agent to be representative of the cost of such insurance to the Lenders. 6 2 "Assignee" has the meaning set forth in Section 9.4(b). "Assignment and Acceptance" means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.4), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent. "Available Commitment" means, as to any Lender at any time, an amount equal to the excess, if any, of (a) such Lender's Commitment over (b) such Lender's Credit Exposure. "Available Excess Investment Commitment Amount" means, as to any Lender at any time, an amount equal to the excess, if any of (a) such Lender's Investment Commitment Amount over (b) such Lender's Credit Exposure. "Base CD Rate" means the sum of (a) the Three Month Secondary CD Rate multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate. "Board" means the Board of Governors of the Federal Reserve System of the United States. "Borrower" means HMTF Bridge Partners, L.P., a Delaware limited partnership. "Business Day" means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City or Dallas, Texas are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Loan, the term Business Day shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market. "Capital Lease Obligations" of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP. "Capital Stock" means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including any limited liability company interests in a limited liability company, any limited or general partnership interests in a partnership, and any and all warrants, rights or options to purchase any of the foregoing. "Change in Control" means any of the following events: (a) Hicks Muse, its principals or Affiliates cease to own of record and beneficially a majority of the economic interests in the Borrower and the power, directly or indirectly, to vote or direct the voting of Capital Stock having a majority of the power to direct the management and policies of the Borrower, or (b) Hicks Muse, its principals or Affiliates cease to Control each Guarantor. ["Bank"] means [Bank]. "Closing Date" means November 24, 1999. "Code" means the Internal Revenue Code of 1986, as amended from time to time. 7 3 "Co-Investor" means the principals of Hicks Muse, their families and employees of Hicks Muse who make an investment in the Borrower with respect to the Borrower's investment in a New Portfolio Company. "Co-Investment" means an investment by a Co-Investor in the Borrower in connection with the Borrower's Investment in a New Portfolio Company in an amount not less than 2.98% of the Borrower's total Investment in such New Portfolio Company. "Commitment" means, as to any Lender, the commitment of such Lender to make Term Loans hereunder, in an amount so that such Lender's Credit Exposure does not exceed such Lender's commitment hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.4 and (b) reduced or increased from time to time as the result of an Assignment and Acceptance. The initial amount of each Lender's Commitment is set forth on Schedule 2.1, or in the Assignment and Acceptance pursuant to which such Lender shall have assumed its Commitment, as applicable. "Control" means the possession of the power, directly or indirectly, to vote more than 50% of the Capital Stock having ordinary voting power for the election of directors (or persons performing similar functions) of a Person. "Controlling" and "Controlled" have meanings correlative thereto. "Credit Exposure" means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender's Term Loans at such time. "Default" means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default. "Directly Owned Investment Party" means any Person in which the Borrower directly makes an Investment which Person directly or indirectly makes the same Investment (which shall be a Permitted Investment) in a New Portfolio Company. "dollars" or "$" refers to lawful money of the United States. "Eurodollar Base Rate" means with respect to each day during each Interest Period pertaining to a Eurodollar Loan, the rate per annum equal to the rate at which [Bank] is offered dollar deposits at or about 10:00 A.M., New York, New York time, two Business Days prior to the beginning of such Interest Period in the interbank eurodollar market where the eurodollar and foreign currency and exchange operations in respect of its Eurodollar Loans are then being conducted for delivery on the first day of such Interest Period for the number of days comprised therein and in an amount comparable to the amount of its Eurodollar Loan to be outstanding during such Interest Period. "Eurodollar Loans" means Term Loans the rate of interest applicable to which is based upon the Eurodollar Rate. "Eurodollar Rate" with respect to each day during each Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for such day (rounded upward to the nearest 1/100th of 1%) equal to (a) the Eurodollar Base Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate. 8 4 "Eurodollar Tranche" the collective reference to Eurodollar Loans the then current Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such Eurodollar Loans shall originally have been made on the same day). "Event of Default" has the meaning assigned to such term in Article 7. "Federal Funds Effective Rate" means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it. "Fees" means the fees payable pursuant to Section 2.9. "Fund I" means Hicks, Muse, Tate & Furst Equity Fund, L.P. "Fund II" means Hicks, Muse, Tate & Furst Equity Fund II, L.P. "Fund III" means Hicks, Muse, Tate & Furst Equity Fund III, L.P. "Fund IV" means Hicks, Muse, Tate & Furst Equity Fund IV, L.P and Hicks, Muse, Tate & Furst Private Fund IV, L.P. "Funding Fee" has the meaning set forth in Section 2.9(a). "GAAP" means generally accepted accounting principles in the United States from time to time. "Globix Investment" means an Investment in the Series A Convertible Preferred Stock of Globix Corporation. "Governmental Authority" means the government of the United States, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Guarantee" of or by any Person (the "guarantor") means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the "primary obligor") in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. 9 5 "Guarantors" means the collective reference to (a) each Affiliate of Hicks Muse that holds carried interests in any New Portfolio Company (except to the extent that a carried interest is attributable to an investment by any Specified Fund in such New Portfolio Company) and (b) HM & Co. and each other Affiliate of Hicks Muse that receives fee income (whether in the form of management fees, transaction fees, investment banking fees, advisory fees or otherwise) from or in respect of any New Fund, any New Portfolio Company or any Investment Party (except to the extent that such fee income is attributable to an investment by any Specified Fund in such New Portfolio Company, with any allocation of such fee income attributable to Specified Fund(s) and New Fund(s) being made in a manner equitable to the Lenders hereunder), in each case whether now existing or subsequently formed. "Hicks Muse" means HMTF Operating, L.P., a Texas limited partnership. "HM & Co." means Hicks, Muse & Co. Partners, L.P., a Texas limited partnership. "Hicks Muse Letter Agreement" means the Letter Agreement dated as of the date hereof between Hicks Muse and the Administrative Agent on behalf of the Lenders, substantially in the form of Exhibit G, as the same may be amended, supplemented or otherwise modified from time to time. "Indebtedness" of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (d) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (e) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (f) all Guarantees by such Person of Indebtedness of others, (g) all Capital Lease Obligations of such Person, (h) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty and (i) all obligations, contingent or otherwise, of such Person in respect of bankers' acceptances. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person's ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. "Interest Payment Date" means (a) as to any ABR Loan, the date which is the Maturity Date, (b) as to any Eurodollar Loan, the last day of the Interest Period applicable thereto and (c) as to any Term Loan, the date of any repayment or prepayment made in respect thereof. "Interest Period" means, as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or four weeks thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect thereto and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or four weeks thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day. 10 6 "Investment" means the collective reference to any direct or indirect investment in a New Portfolio Company by Borrower consistent with investments made by, or permitted under, any Specified Fund. "Investment Commitment Amount" means the amount on the date giving rise to this calculation, as calculated by the Borrower and the Administrative Agent, rounded upward to the nearest $500,000.00, that represents (i) the Term Loans and (ii) all interest and fees previously accrued or which will be payable pursuant to Sections 2.8 and 2.9 through the Maturity Date assuming no prepayments pursuant to Section 2.5 prior to the Maturity Date (using for future periods not covered by existing Interest Periods, the Eurodollar Rate available on the date of any determination for a one week Interest Period plus the Applicable Margin). The Investment Commitment Amount of any Lender at any time shall be its Loan Percentage of the total Investment Commitment Amount. "Investment Party" means any Person in which the Borrower directly or indirectly makes an Investment which Person directly or indirectly makes the same Investment (which shall be a Permitted Investment) in a New Portfolio Company. "Investment Term Loan" has the meaning set forth in Section 2.9(a). "Lenders" means the Persons listed on Schedule 2.1 and any other Person that shall have become a party hereto pursuant to an Assignment and Acceptance, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Acceptance. "Library Services Investment" means an Investment in the common stock of Dynix Corporation. "Lien" means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities. "Loan Documents" means the collective reference to this Agreement, the Affiliate Guarantees, the Pledge Agreement, the Hicks Muse Letter Agreement, the Principal Agreements and the Notes. "Loan Parties" means the collective reference to the Borrower, the Guarantors, Hicks Muse and any other Person party to a Loan Document. "Loan Percentage" means, with respect to any Lender, the percentage of the total Commitments represented by such Lender's Commitment, and, if the Commitments have terminated, the aggregate outstanding principal amount of the Term Loans represented by such Lender's Term Loans. "Material Adverse Effect" means a material adverse effect on (a) the ability of any Loan Party to perform any of its obligations under any Loan Document or (b) the rights of or benefits available to the Lenders under any Loan Document. "Maturity Date" means the earlier of (a) January 15, 2000 and (b) the first date after the Closing Date on which Hicks Muse or any of its Affiliates shall have entered into a credit facility (a 11 7 "Replacement Credit Facility") for the purpose of providing interim financing for investments to be made by one or more funds organized by Hicks Muse or any of its Affiliates. "New Fund" means (a) any investment funds formed after the date hereof and (other than the Olympus Real Estate Fund III, L.P., any private fund raised in connection with the Olympus Real Estate Private Fund III, L.P., Hicks, Muse, Tate & Furst Latin America Fund II, L.P., Hicks, Muse, Tate & Furst Latin America Private Fund II, L.P. or any other fund agreed to by the Administrative Agent) sponsored, advised or managed by Hicks Muse or any of its Affiliates or (b) any other Person which may acquire an Investment in an Investment Party or a New Portfolio Company or any part thereof. "New Portfolio Company" means any Person, having as some or all of its shareholders, partners or members, as the case may be, directly or indirectly, the Borrower, Affiliates of the Borrower, and, if applicable, one or more Co-Investors. "Non-Consenting Lender" has the meaning set forth in Section 2.16. "Non-Excluded Taxes" has the meaning set forth in Section 2.13(a). "Non-Funding Lender" has the meaning set forth in Section 2.11. "Non-U.S. Lender" has the meaning set forth in Section 2.13(b). "Note" has the meaning set forth in Section 2.3(e). "Obligations" means the collective reference to the unpaid principal of and interest on the Term Loans and all other obligations and liabilities of the Borrower to the Administrative Agent and the Lenders (including, without limitation, interest accruing at the then applicable rate provided in this Agreement after the maturity of the Term Loans and interest accruing at the then applicable rate provided in this Agreement after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement or any other document made, delivered or given in connection therewith, in each case whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including, without limitation, all fees and disbursements of counsel to the Administrative Agent or to the Lenders that are required to be paid by the Borrower pursuant to the terms of this Agreement). "Participant" has the meaning set forth in Section 9.4(e). "Permitted Investments" means the collective reference to the Globix Investment, the Library Services Investment, the Teligent Investment and other Investments of the type as described in Section 4.2(h). "Person" means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity. "Pledge Agreement" means the Pledge Agreement executed and delivered by the Borrower, substantially in the form of Exhibit F, as the same may be amended, supplemented or otherwise modified from time to time. 12 8 "Prime Rate" means the rate of interest per annum publicly announced from time to time by [Bank] as its prime rate in effect at its principal office in New York, New York; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to a customer. "Principal Agreement" means the Principal Agreement executed and delivered by each principal of Hicks Muse, substantially in the form of Exhibit H, as the same may be amended, supplemented or otherwise modified from time to time. "Register" has the meaning set forth in Section 9.4(c). "Related Parties" means, with respect to any specified Person, such Person's Affiliates and the respective directors, officers, employees, agents, partners and advisors of such Person and such Person's Affiliates. "Replacement Credit Facility" has the meaning set forth in the definition of "Maturity Date". "Required Lenders" at any time, Lenders of more than 50% of (a) the Commitments or (b) if the Commitments have been terminated, the aggregate unpaid principal amount of the Term Loans. "Requirement of Law" as to any Person, the Certificate of Incorporation and By-Laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject. "Responsible Officer" means the Chief Executive Officer, the President, any Vice President, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary or any officer holding a position with similar obligations. "Restricted Payment" means any dividend or other distribution (whether in cash, securities or other property) with respect to any shares of any class of Capital Stock of any Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such shares of Capital Stock of such Person or any option, warrant or other right to acquire any such shares of Capital Stock of such Person. "Specified Fund" means Fund I, Fund II, Fund III, Fund IV, Olympus Real Estate Fund I, L.P., Olympus Real Estate Fund II, L.P., Hicks, Muse, Tate & Furst Latin America Fund, L.P., Hicks, Muse, Tate & Furst Latin America Private Fund, L.P., Hicks, Muse, Tate & Furst Europe Fund, L.P. and Hicks, Muse, Tate & Furst Europe Private Fund, L.P. "Statutory Reserve Rate" means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject (a) with respect to the Base CD Rate, for new negotiable nonpersonal time deposits in dollars of over $100,000 with maturities approximately equal to three months and (b) with respect to the Eurodollar Rate, for eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Loans 13 9 shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage. "Teligent Investment" shall mean an Investment in the convertible preferred stock of Teligent, Inc. "Term Loans" has the meaning set forth in Section 2.1. "Three Month Secondary CD Rate" means, for any day, the secondary market rate for three month certificates of deposit reported as being in effect on such day (or, if such day is not a Business Day, the next preceding Business Day) by the Board through the public information telephone line of the Federal Reserve Bank of New York (which rate will, under the current practices of the Board, be published in Federal Reserve Statistical Release H.15(519) during the week following such day) or, if such rate is not so reported on such day or such next preceding Business Day, the average of the secondary market quotations for three month certificates of deposit of major money center banks in New York City received at approximately 12:00 noon, New York City time, on such day (or, if such day is not a Business Day, on the next preceding Business Day) by the Administrative Agent from three negotiable certificate of deposit dealers of recognized standing selected by it. "Ticking Fee" has the meaning set forth in Section 2.9(b). "Transactions" means the execution, delivery and performance by the Loan Parties of the Loan Documents, the borrowing of Term Loans and the use of the proceeds thereof, the grant of the Liens under the Loan Documents and the making of each Investment. "Type" as to any Term Loans, its nature as an ABR Loan or a Eurodollar Loan. "United States" means the United States of America. SECTION 1.2 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words "include", "includes" and "including" shall be deemed to be followed by the phrase "without limitation". The word "will" shall be construed to have the same meaning and effect as the word "shall". Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person's successors and assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. SECTION 1.3 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time. 14 10 ARTICLE 2 Term Loans SECTION 2.1 Term Loans. Subject to the terms and conditions hereof, each Lender severally agrees to make one or more term loans (each, a "Term Loan") to the Borrower on the Closing Date and on any Business Day thereafter prior to the Maturity Date in an aggregate principal amount not to exceed such Lender's Available Commitment. The initial amount of each Lender's Commitment is set forth on Schedule 2.1, or in the Assignment and Acceptance pursuant to which such Lender shall have assumed its Commitment, as applicable. The Term Loans may from time to time be (a) Eurodollar Loans or (b) ABR Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.2 and 2.6. Each Term Loan shall be made as part of a borrowing consisting of Term Loans made by the Lenders ratably in accordance with their respective Commitments. Amounts repaid or prepaid on account of the Term Loans may not be reborrowed. The Term Loans shall be made only if the total Investment Commitment Amounts shall not exceed the total Commitments. SECTION 2.2 Procedure for Term Loan Borrowing. The Borrower shall give the Administrative Agent irrevocable notice (including telephonic notice confirmed in writing) (which notice must be received by the Administrative Agent (a) in the case of Eurodollar Loans, not later than 11:00 a.m., New York, New York time, three Business Days before the date of the anticipated borrowing and (b) in the case of ABR Loans, not later than 12:00 noon, New York, New York time, one Business Day prior to the date of the anticipated borrowing) requesting that the Lenders make the Term Loans on such borrowing date and specifying the amount to be borrowed. The Term Loans made on the Closing Date shall initially be ABR Loans. Upon receipt of such notice the Administrative Agent shall promptly notify each Lender thereof. Not later than 11:00 a.m., New York, New York time, on the relevant borrowing date each Lender shall make available to the Administrative Agent at its office specified in Section 9.1 an amount in immediately available funds equal to the Term Loan to be made by such Lender. The Administrative Agent shall credit the account of the Borrower on the books of such office of the Administrative Agent with the aggregate of the amounts made available to the Administrative Agent by the Lenders in immediately available funds. SECTION 2.3 Repayment of Loans; Evidence of Debt; etc. (a) The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Lender the then unpaid principal amount of the Term Loans of such Lender on the Maturity Date (or such earlier date on which the Term Loans shall become due and payable pursuant to Article 7). (b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing indebtedness of the Borrower to such Lender resulting from the Term Loans of such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement. (c) The Administrative Agent shall maintain the Register pursuant to Section 9.4(c), and a subaccount therein for each Lender, in which shall be recorded (i) the amount of each Term Loans made hereunder, including each Term Loan evidenced by a Note, the Type thereof and each Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) both the amount of any sum received by the Administrative Agent hereunder from the Borrower and each Lender's share thereof. (d) The entries made in the Register and the accounts of each Lender maintained pursuant to Section 2.3(b) shall, to the extent permitted by applicable law, be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded, absent manifest error; 15 11 provided, however, that the failure of any Lender or the Administrative Agent to maintain the Register or any such account, or any error therein, shall not in any manner affect the obligation of the Borrower to repay (with applicable interest) the Term Loans made to the Borrower by such Lender in accordance with the terms of this Agreement. (e) The Borrower agrees that, upon the request to the Administrative Agent by any Lender, the Borrower will execute and deliver to such Lender a promissory note of the Borrower evidencing the Term Loans of such Lender, substantially in the form of Exhibit E, with appropriate insertions as to date and principal amount (a "Note"). SECTION 2.4 Termination and Reduction of Commitments. (a) Unless previously terminated by the Borrower in accordance with this Agreement, the Commitments shall terminate on the Maturity Date. (b) The Borrower may at any time terminate, or from time to time reduce, the Commitments; provided that (i) each reduction of the Commitments shall be in an amount that is an integral multiple of $1,000,000 and not less than $1,000,000 and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.5, the sum of the Credit Exposures would exceed the total Commitments. (c) The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under Section 2.4(b) at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section 2.4(c) shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shall be made ratably among the Lenders in accordance with their respective Commitments. SECTION 2.5 Prepayments. (a) The Borrower may at any time and from time to time prepay the Term Loans, in whole or in part, without premium or penalty, upon irrevocable notice (including telephonic notice confirmed in writing) delivered to the Administrative Agent at least three Business Days prior thereto in the case of Eurodollar Loans and at least one Business Day prior thereto in the case of ABR Loans, which notice shall specify the date and amount of prepayment and whether the prepayment is of Eurodollar Loans, ABR Loans or a combination thereof, and, if of a combination thereof, the amount allocable to each; provided that, if a Eurodollar Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.14. Upon receipt of any such notice, the Administrative Agent shall promptly notify each Lender thereof. If any such notice is given, the amount specified in such notice, together with accrued interest thereon, shall be due and payable on the date specified therein; provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Commitments as contemplated by Section 2.4, then such notice of prepayment may be revoked if such notice is revoked in accordance with Section 2.4. (b) If any Capital Stock shall be issued by, or any capital contribution shall be made to, the Borrower or any Investment Party (other than a New Portfolio Company and other than with respect to any Co-Investment) or if the Borrower or any Investment Party (other than a New Portfolio Company and other than ratably with respect to any Co-Investment) receives any Restricted Payment, 100% of the 16 12 net cash proceeds thereof or of such Restricted Payment, in each case received by the Borrower, shall be applied toward the prepayment in full of the Term Loans, together with accrued interest thereon. All prepayments made by Borrower in accordance with this Section 2.5(b) shall result in a pro rata reduction of the Commitments. (c) Upon any sale, assignment, conveyance, transfer or other disposition (in whole or in part) of any interest in the Borrower (other than any sale, assignment, conveyance, transfer or other disposition to any Co-Investor) or any interest of the Borrower in any Investment Party or a New Portfolio Company, 100% of the net cash proceeds (taking into account any necessary escrows) thereof received by the Borrower (less the ratable interest of any Co-Investors) shall be applied on the date thereof toward the prepayment in full of the Term Loans, together with accrued interest thereon. All prepayments made by Borrower in accordance with this Section 2.5(c) shall result in a pro rata reduction of the Commitments. (d) The application of any prepayment pursuant to paragraphs (b) or (c) of this Section 2.5 shall be made first to ABR Loans and second to Eurodollar Loans. Amounts prepaid on account of the Term Loans may not be reborrowed. (e) Notwithstanding anything to the contrary contained herein, in the event that the Borrower would incur costs pursuant to Section 2.14 as a result of any payment due as a result of any prepayment to be made pursuant to this Section 2.5, the Borrower, at its option, may deposit the amount of such payment with the Administrative Agent, for the benefit of the Lenders who would have received such payment, in a cash collateral account until the end of the applicable Interest Period at which time such payment shall be made. The Borrower hereby grants to the Administrative Agent, for the benefit of such Lenders, a security interest in all amounts in which the Borrower has any right, title or interest which are from time to time on deposit in such cash collateral account and expressly waives all rights (which rights the Borrower hereby acknowledges and agrees are vested exclusively in the Administrative Agent) to exercise dominion or control over any such amounts. SECTION 2.6 Conversion and Continuation Options. (a) The Borrower may elect from time to time to convert Eurodollar Loans to ABR Loans by giving the Administrative Agent at least one Business Day's prior irrevocable notice of such election, provided that if such conversion of Eurodollar Loans is made other than on the last day of an Interest Period with respect thereto, then the Borrower shall pay the Lenders any amounts due pursuant to Section 2.14. The Borrower may elect from time to time to convert ABR Loans to Eurodollar Loans by giving the Administrative Agent at least three Business Days' prior irrevocable notice of such election (which notice shall specify the length of the initial Interest Period therefor), provided that no ABR Loan may be converted into a Eurodollar Loan when (i) any Event of Default has occurred and is continuing and (ii) the Administrative Agent or the Required Lenders have determined in its or their reasonable discretion not to permit such conversions. Upon receipt of any such notice the Administrative Agent shall promptly notify each Lender thereof. (b) Any Eurodollar Loan may be continued as such upon the expiration of the then current Interest Period with respect thereto by the Borrower giving irrevocable notice to the Administrative Agent, in accordance with the applicable provisions of the term "Interest Period" set forth in Section 1.1, of the length of the next Interest Period to be applicable to such Loans, provided that no Eurodollar Loan may be continued as such when any Event of Default has occurred and is continuing and the Administrative Agent has or the Required Lenders have determined in its or their reasonable discretion not to permit such continuations, and provided, further, that if the Borrower shall fail to give any required notice as described above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso such Loans shall be automatically converted to ABR Loans on the last day of 17 13 such then expiring Interest Period. Upon receipt of any such notice the Administrative Agent shall promptly notify each Lender thereof. SECTION 2.7 Minimum Amounts and Maximum Number of Tranches. Notwithstanding anything to the contrary in this Agreement, all borrowings, conversions, continuations and optional prepayments of Eurodollar Loans hereunder and all selections of Interest Periods hereunder shall be in minimum amounts of $1,000,000 and incremental amounts of $100,000 in excess thereof and shall be made pursuant to such elections so that, after giving effect thereto no more than five Eurodollar Tranches shall be outstanding at any one time. SECTION 2.8 Interest. (a) Each Eurodollar Loan shall bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the Eurodollar Rate determined for such day plus the Applicable Margin. (b) Each ABR Loan shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Margin. (c) If all or a portion of (i) any principal of any Term Loan, (ii) any interest payable thereon or (iii) any Fees or any other amount payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), the principal of the Term Loans and any such overdue interest, Fees or other amount shall bear interest at a rate per annum which is (x) in the case of principal, the rate that would otherwise be applicable thereto pursuant to the foregoing provisions of this Section 2.8 plus 2% or (y) in the case of any such overdue interest, Fees or other amount, the rate in effect at such time pursuant to paragraph (b) of this Section 2.8 plus 2%, in each case from the date of such non-payment until such overdue principal, interest, Fees or other amount is paid in full (before as well as after receipt of a judgment). (d) Interest shall be payable in arrears on each Interest Payment Date and the Maturity Date, provided that interest accruing pursuant to paragraph (c) of this Section 2.8 shall be payable from time to time on demand. (e) Whenever it is calculated on the basis of the Prime Rate, interest shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed; and, otherwise, interest shall be calculated on the basis of a 360-day year for the actual days elapsed. The Administrative Agent shall as soon as practicable notify the Borrower and the Lenders of each determination of a Eurodollar Rate. Any change in the interest rate on a Term Loan resulting from a change in the Alternate Base Rate shall become effective as of the opening of business on the day on which such change becomes effective. The Administrative Agent shall as soon as practicable notify the Borrower and the Lenders of the effective date and the amount of each such change in interest rate. (f) Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of manifest error. The Administrative Agent shall, at the request of the Borrower, deliver to the Borrower a statement showing the quotations used by the Administrative Agent in determining any interest rate in respect of any Eurodollar Loan. SECTION 2.9 Fees. (a) The Borrower agrees to pay to the Administrative Agent, for the account of each Lender, a funding fee (the "Funding Fee") equal to 1.0% of each Term Loan made to fund an Investment (and not for the payment of interest and fees) (each borrowing of such a Term Loan, an "Investment Term Loan"), payable on the date of the funding of each such Investment Term Loan. 18 14 (b) The Borrower agrees to pay to the Administrative Agent, for the account of each Lender, a ticking fee (the "Ticking Fee") in the amount of 0.5% per annum on the average daily amount of the Available Excess Investment Commitment Amount, which shall be paid by Borrower to the Administrative Agent on the Maturity Date (or if this Agreement is terminated prior to the Maturity Date, the date this Agreement is terminated). SECTION 2.10 Inability to Determine Interest Rate. If prior to the first day of any Interest Period: (a) the Administrative Agent shall have determined (which determination, in the absence of manifest error, shall be conclusive and binding upon the Borrower) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Eurodollar Rate for such Interest Period, or (b) the Administrative Agent shall have received notice from the Required Lenders that the Eurodollar Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or maintaining their Term Loans during such Interest Period, the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrower and the Lenders as soon as practicable thereafter. If such notice is given (i) any Eurodollar Loans requested to be made on the first day of such Interest Period shall be made as ABR Loans, (ii) any Term Loans that were to have been converted on the first day of such Interest Period to Eurodollar Loans shall be continued as ABR Loans and (iii) any outstanding Eurodollar Loans shall be converted to ABR Loans on the last day of the Interest Period applicable thereto. Until such notice has been withdrawn by the Administrative Agent (which the Administrative Agent agrees to do when the circumstances that prompted the delivery of such notice no longer exist), no further Eurodollar Loans shall be made or continued as such, nor shall the Borrower have the right to convert ABR Loans to Eurodollar Loans. SECTION 2.11 Pro Rata Treatment and Payments. (a) Each payment (including each prepayment) by the Borrower on account of principal of and interest on, and fees with respect to, the Term Loans shall be made pro rata according to the respective outstanding principal amounts of the Term Loans then held by the Lenders. (b) All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest or otherwise, shall be made without setoff or counterclaim and shall be made prior to 12:00 Noon, New York, New York time, on the due date thereof to the Administrative Agent, for the account of the Lenders, at the Administrative Agent's office specified in Section 9.1, in dollars and in immediately available funds. The Administrative Agent shall distribute such payments to the Lenders promptly upon receipt in like funds as received. If any payment hereunder becomes due and payable on a day other than a Business Day, such payment shall be extended to the next succeeding Business Day (except, in the case of Eurodollar Loans, as otherwise provided in clause (i) of the definition of "Interest Period"). In the case of any extension of any payment of principal pursuant to the preceding sentence, interest thereon shall be payable at the then applicable rate during such extension. (c) Notwithstanding that a Lender (a "Non-Funding Lender") has (x) failed to make a Term Loan required to be made by it hereunder, and the Administrative Agent has determined that such Lender is not likely to make such Term Loan or (y) given notice to the Borrower or the Administrative Agent that it will not make, or that it has disaffirmed or repudiated any obligation to make, any Term Loans, in each case, by reason of the provisions of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 or otherwise, any payment made on account of the principal of the Term Loans outstanding shall be made pro rata according to the respective outstanding principal amounts of such 19 15 Term Loans; and any payment made on account of interest on the Term Loans shall be made pro rata according to the respective amounts of accrued and unpaid interest and/or fees due and payable on such Term Loans with respect to which such payment is being made. The Borrower agrees to give the Administrative Agent such assistance in making any determination pursuant to this paragraph as the Administrative Agent may reasonably request. Any such determination by the Administrative Agent shall be conclusive and binding on the Lenders. SECTION 2.12 Requirements of Law. (a) If the adoption of or any change in any Requirement of Law or in the interpretation or application thereof or compliance by any Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof: (i) shall subject any Lender to any tax of any kind whatsoever with respect to this Agreement or any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender in respect thereof (except Non-Excluded Taxes covered by Section 2.13, the establishment of a tax based on the net income of such Lender and changes in the rate of tax on the net income of such Lender); (ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of such Lender which is not otherwise included in the determination of the Eurodollar Rate hereunder; or (iii) shall impose on such Lender any other condition; and the result of any of the foregoing is to increase the cost to such Lender, by an amount which such Lender deems to be material, of making, converting into, continuing or maintaining Eurodollar Loans, or to reduce any amount receivable hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay such Lender, upon its demand, any additional amounts necessary to compensate such Lender for such increased cost or reduced amount receivable. If the Borrower notifies the Administrative Agent within five Business Days after any Lender notifies the Borrower of any increased cost pursuant to the foregoing provisions of this Section 2.12(a), the Borrower may covert all Eurodollar Loans of such Lender then outstanding into ABR Loans in accordance with Section 2.6 and shall, additionally, reimburse such Lender for any cost in accordance with Section 2.14. (b) If any Lender shall have determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on such Lender's or such corporation's capital as a consequence of its obligations hereunder to a level below that which such Lender or such corporation could have achieved but for such adoption, change or compliance (taking into consideration such Lender's or such corporation's policies with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time, after submission by such Lender to the Borrower through the Administrative Agent of a written request therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender for such reduction. (c) A certificate as to any additional amounts payable pursuant to this Section 2.12 showing in reasonable detail the calculation thereof and certifying that it is generally charging such costs to other similarly situated borrowers under similar credit facilities submitted by any Lender to the Borrower through the Administrative Agent shall be conclusive in the absence of manifest error, provided that the determination of such amounts shall be made in good faith in a manner generally consistent with 20 16 such Lender's standard practices. The obligations of the Borrower pursuant to this Section 2.12 shall survive the termination of this Agreement and the payment of the Term Loans and all other amounts payable hereunder for a period of nine months thereafter. If any Lender becomes entitled to claim any additional amounts pursuant to this Section 2.12, it shall promptly (and in any event no later than 90 days after such Lender becomes entitled to make such claim) notify the Borrower through the Administrative Agent of the event by reason of which it has become so entitled. SECTION 2.13 Taxes. (a) All payments made by the Borrower under this Agreement, except as provided in this Section 2.13, shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net income taxes and franchise taxes (imposed in lieu of net income taxes) imposed on the Administrative Agent or any Lender as a result of a present or former connection between the Administrative Agent or such Lender and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from the Administrative Agent or such Lender having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement or any other Loan Document). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded Taxes") are required to be withheld from any amounts payable to the Administrative Agent or any Lender hereunder, the amounts so payable to the Administrative Agent or such Lender shall be increased to the extent necessary to yield to the Administrative Agent or such Lender (after payment of all Non-Excluded Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement, provided, however, that the Borrower shall not be required to increase any such amounts payable to any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender's failure to comply with the requirements of this Section, (ii) that are United States withholding taxes imposed on amounts payable to such Lender at the time the Lender becomes a party to this Agreement, except to the extent that such Lender's assignor (if any) was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such Non-Excluded Taxes pursuant to Section 2.13(a) or (iii) that are imposed as a result of an event occurring after the date the Lender becomes a Lender other than a change in law or regulation or the introduction of any law or regulation or a change in interpretation or administration of any law. Whenever any Non-Excluded Taxes are payable by the Borrower, as promptly as possible thereafter the Borrower shall send to the Administrative Agent for its own account or for the account of such Lender, as the case may be, a certified copy of an original official receipt received by the Borrower showing payment thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent and the Lenders for any incremental taxes, interest or penalties that may become payable by the Administrative Agent or any Lender as a result of any such failure. The agreements in this Section 2.13 shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder for a period of nine months thereafter. (b) Each Lender (or Transferee) that is not a person within the meaning of Section 7701(a)(30) of the Code (a "Non-U.S. Lender") shall deliver to the Borrower and the Administrative Agent (or, in the case of a Participant, to the Lender from which the related participation shall have been purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of "portfolio interest", a Form W-8BEN, or any subsequent versions thereof or successors thereto (and, if such Non-U.S. Lender delivers a Form W-8BEN, an annual certificate representing, under penalty of perjury, that such Non-U.S. Lender is not a "bank" for purposes of Section 881(c) of the Code, is not a 10 percent shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of the Borrower and is not a controlled foreign corporation related to 21 17 the Borrower (within the meaning of Section 864(d)(4) of the Code)), properly completed and duly executed by such Non-U.S. Lender claiming complete exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the Borrower under this Agreement and the other Loan Documents. Such forms shall be delivered by each Non-U.S. Lender on or before the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the date such Participant purchases the related participation). In addition, each Non-U.S. Lender shall deliver such forms on or before the expiration or obsolescence and promptly upon the invalidity of any form previously delivered by such Non-U.S. Lender and after the occurrence of any event requiring a change in the most recently provided form and, if necessary, obtain any extensions of time reasonably requested by the Borrower or the Administrative Agent for filing and completing such forms. Each Non-U.S. Lender agrees, to the extent legally entitled to do so, upon reasonable request by the Borrower, to provide to the Borrower (for the benefit of the Borrower and the Administrative Agent) such other forms as may be reasonably required in order to establish the legal entitlement of such Lender to an exemption from withholding with respect to payments of interest under this Agreement or the other Loan Documents, provided that in determining the reasonableness of such a request, such Lender shall be entitled to consider the cost of complying with such request (to the extent unreimbursed by the Borrower) that would be imposed on such Lender. Each Non-U.S. Lender shall promptly notify the Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the U.S. taxing authorities for such purpose). Notwithstanding any other provision of this Section 2.13(b), a Non-U.S. Lender shall not be required to deliver any form pursuant to this Section 2.13(b) that such Non-U.S. Lender is not legally able to deliver. (c) If the Administrative Agent or any Lender receives a refund in respect of Non-Excluded Taxes paid by the Borrower, which in the good faith judgment of such Lender is allocable to such payment, it shall promptly pay such refund, together with any other amounts paid by the Borrower in connection with such refunded Non-Excluded Taxes, to the Borrower, net of all out-of-pocket expenses of such Lender incurred in obtaining such refund, provided, however, that the Borrower agrees to promptly return such refund to the Administrative Agent or the applicable Lender, as the case may be, if it receives notice from the Administrative Agent or applicable Lender that such Administrative Agent or Lender is required to repay such refund. SECTION 2.14 Indemnity. The Borrower agrees to indemnify each Lender and to hold each Lender harmless from any loss (excluding loss of profit) or expense which such Lender may sustain or incur as a consequence of (a) default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (b) default by the Borrower in making any prepayment after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (c) the making of a prepayment of Eurodollar Loans on a day which is not the last day of an Interest Period with respect thereto. Such indemnification may include an amount equal to the excess, if any, of (i) the amount of interest which would have accrued on the amount so prepaid, or not so borrowed, converted or continued, for the period from the date of such prepayment or of such failure to borrow, convert or continue to the last day of such Interest Period (or, in the case of a failure to borrow, convert or continue, the Interest Period that would have commenced on the date of such failure) in each case at the applicable rate of interest for such Loans provided for herein (excluding, however, any margin included therein, if any) over (ii) the amount of interest (as reasonably determined by such Lender) which would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the interbank eurodollar market. A certificate as to any amounts payable pursuant to this Section 2.14, showing in reasonable detail the calculation thereof, submitted to the Borrower by any Lender shall be conclusive in the absence of manifest error. This covenant shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder for a period of nine months thereafter. 22 18 SECTION 2.15 Change of Lending Office. Each Lender agrees that if it makes any demand for payment under Section 2.13(a), or if any adoption or change of the type described in Section 2.12 shall occur with respect to it, it will use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions and so long as such efforts would not be disadvantageous to it, as determined in its reasonable discretion) to designate a different lending office if the making of such a designation would reduce or obviate the need for the Borrower to make payments under Section 2.13(a), or would eliminate or reduce the effect of any adoption or change described in Section 2.12. SECTION 2.16 Replacement of Lenders. If, at any time (a) the Borrower becomes obligated to pay additional amounts described in Sections 2.12 or 2.13 as a result of any conditions described in such Sections, (b) any Lender becomes insolvent and its assets become subject to a receiver, liquidator, trustee, custodian or other Person having similar powers, (c) any Lender becomes a "Non- consenting Lender" (as defined below in this Section 2.16) or (d) any Lender becomes a Non-Funding Lender, then the Borrower may, on ten Business Days prior written notice to the Administrative Agent and such Lender, replace such Lender by causing such Lender to (and such Lender shall) assign pursuant to Section 9.4(b) all of its rights and obligations under this Agreement to a Lender or other entity selected by the Borrower and reasonably acceptable to the Administrative Agent for a purchase price equal to the outstanding principal amount of such Lender's Loans and all accrued interest and fees and other amounts payable hereunder; provided that (i) the Borrower shall have no right to replace the Administrative Agent, (ii) neither the Administrative Agent nor any Lender shall have any obligation to the Borrower to find a replacement Lender or other such entity, (iii) in the event of replacement of a Non-consenting Lender or a Lender to which the Borrower becomes obligated to pay additional amounts pursuant to clause (a) of this Section, in order for the Borrower to be entitled to replace such a Lender, such replacement must take place no later than 180 days after (A) the date the Non-consenting Lender shall have notified the Borrower and the Administrative Agent of its failure to agree to any requested consent, waiver or amendment or (B) the Lender shall have demanded payment of additional amounts under one of the Sections described in clause (a) of this Section, as the case may be and (iv) in no event shall the Lender hereby replaced be required to pay or surrender to such replacement Lender or other entity any of the fees received by such Lender hereby replaced pursuant to this Agreement. In the case of a replacement of a Lender to which the Borrower becomes obligated to pay additional amounts pursuant to clause (a) of this Section, the Borrower shall pay such additional amounts to such Lender prior to such Lender being replaced and the payment of such additional amounts shall be a condition to the replacement of such Lender. In the event that (x) the Borrower or the Administrative Agent has requested the Lenders to consent to a departure or waiver of any provisions of the Loan Documents or to agree to any amendment thereto, (y) the consent, waiver or amendment in question requires the consent of all Lenders and (z) the Required Lenders have agreed to such consent, waiver or amendment, then any such Lender who does not agree to such consent, waiver or amendment shall be deemed a "Non- consenting Lender". The Borrower's right to replace a Non-Funding Lender pursuant to this Section 2.16 is, and shall be, in addition to, and not in lieu of, all other rights and remedies available to the Borrower against such Non-Funding Lender under this Agreement, at law, in equity, or by statute. ARTICLE 3 Representations and Warranties The Borrower represents and warrants to the Lenders, on the Closing Date and on the date of each borrowing hereunder, that: SECTION 3.1 Organization; Powers. The Borrower is duly formed, validly existing and in good standing under the laws of the jurisdiction of its organization or formation, has all requisite power 23 19 and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required. SECTION 3.2 Authorization; Enforceability. The Transactions are within the Borrower's powers and have been duly authorized by all necessary partnership actions. The Loan Documents have been duly executed and delivered on behalf of each Loan Party thereto and constitute a legal, valid and binding obligation of each such party, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. SECTION 3.3 Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) will not violate any applicable law or regulation or the organizational or formation documents of any Loan Party or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture, material agreement or other material instrument binding upon any Loan Party or its assets, or give rise to a right thereunder to require any payment to be made by any Loan Party, and (d) will not result in the creation or imposition of any Lien on any asset of any Loan Party, other than pursuant to the Loan Documents. SECTION 3.4 Compliance with Laws and Agreements. Each Loan Party is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. No Default or Event of Default has occurred and is continuing. SECTION 3.5 Investment and Holding Company Status. The Borrower is not (a) an "investment company" as defined in, or subject to regulation under, the Investment Company Act of 1940 or (b) a "holding company" as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935. SECTION 3.6 Material Adverse Effect. There has been no development or event which has had or could reasonably be expected to have a Material Adverse Effect. SECTION 3.7 No Material Litigation. No litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of any Loan Party, threatened by or against any Loan Party or any Investment Party or against any of their respective properties or revenues (a) with respect to any of the Loan Documents, any Investment Party or any of the transactions contemplated hereby or thereby, or (b) which, if adversely determined, could reasonably be expected to have a Material Adverse Effect. SECTION 3.8 Disclosure. No information, financial statement, report, certificate or other document prepared or furnished by or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with this Agreement or any other Loan Document (but excluding all projections and pro forma financial statements which shall have been prepared in good faith and based upon reasonable assumptions) contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements herein or therein not misleading. 24 20 SECTION 3.9 Investments. (a) On and after the date of the making of each Investment, each applicable Investment Party and each New Portfolio Company in which such Investment is made will be duly organized or formed, validly existing and in good standing under the laws of the jurisdiction of its organization or formation, will have all requisite power and authority to carry out its business as then conducted and proposed to be conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, will be qualified to do business in, and in good standing in, every jurisdiction where such qualification is required. The making of each Investment (i) will be within the power of Borrower and each Investment Party and will be duly authorized by all necessary appropriate action by Borrower and each applicable Investment Party, (ii) will not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as will have been obtained or made and be in full force and effect, (iii) will not violate any applicable law or regulation or any organizational document of the Borrower, any applicable Investment Party and applicable New Portfolio Company or any order of any Governmental Authority, (iv) will not violate or result in a default under any indenture, material agreement or material other instrument binding upon the Borrower, the applicable Investment Party and applicable New Portfolio Company or its assets, or give rise to a right thereunder to require any payment to be made by the Borrower, the applicable Investment Party or the applicable New Portfolio Company (other than payments made simultaneously with such Investment), and (v) will not result in the creation or imposition of any Lien on any asset of the Borrower, the applicable Investment Party or New Portfolio Company except Liens under the Pledge Agreement and Liens on the acquired assets to secure Indebtedness owed to third party lenders incurred in connection with the making of an Investment in the assets acquired thereby. ARTICLE 4 Conditions Precedent SECTION 4.1 The obligations of the Lenders to make the Term Loans hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.2): (a) Loan Documents. The Administrative Agent (or its counsel) shall have received (i) this Agreement, duly executed and delivered by the Borrower, (ii) an Affiliate Guarantee, duly executed and delivered by each Guarantor in existence on the Closing Date, (iii) the Pledge Agreement, duly executed and delivered by the Borrower, together with all documents required to be delivered thereunder, all certificates representing the Pledge Interests listed on Schedule I thereto and stock powers endorsed in blank, (iv) the Hicks Muse Letter Agreement, duly executed and delivered by each party thereto, and (v) each of the Principal Agreements, duly executed and delivered by each party thereto. (b) Closing Certificate. The Administrative Agent shall have received, with a counterpart for each Lender, a certificate of each Loan Party, dated the Closing Date, substantially in the form of Exhibit C, with appropriate insertions and attachments. (c) Legal Opinion. The Administrative Agent shall have received the executed legal opinion of Weil, Gotshal & Manges LLP, counsel to the Loan Parties, substantially in the form of Exhibit B. (d) Approvals. All governmental and third party approvals necessary or, in the discretion of the Administrative Agent, advisable in connection with the Transactions shall have been obtained and be in full force and effect, and all applicable waiting periods shall have expired without any action being taken or threatened by any competent authority which would restrain, prevent or otherwise 25 21 impose adverse conditions on the Borrower's ability to perform its obligations under the Loan Documents. (e) Fees. The Administrative Agent shall have received all fees and other amounts due and payable on or prior to the date hereof. (f) Filings. Any documents (including, without limitation, financing statements) required to be filed, registered or recorded in order to create, for the benefit of the Administrative Agent and the Lenders, a perfected, first priority security interest shall have been properly prepared for filing, registration or recording in each office in each jurisdiction in which such filings, registrations and recordations are required to perfect such first priority security interests created by the Pledge Agreement, and the Administrative Agent shall be satisfied that such recordings and filings will be completed promptly after the date hereof. SECTION 4.2 Additional Conditions for Each Credit Event. The obligation of each Lender to make Term Loans on the occasion of any borrowing (other than Term Loans made for the payment of interest and Fees) is subject to the satisfaction of the following conditions: (a) Pledge Agreement. The Administrative Agent shall have received from the Borrower a Pledge Supplement (as defined in the Pledge Agreement) to the Pledge Agreement signed on behalf of the Borrower together with (i)(x) the stock certificates, notes or other evidence of ownership representing the Investment in any New Portfolio Company or Directly Owned Investment Party owned by the Borrower or to be acquired concurrently with such borrowing or such issuance and (y) undated stock or transfer powers, executed in blank, for any certificates representing such Investment, executed and delivered by a Responsible Officer of the Borrower or (ii) any necessary UCC filings signed on behalf of the Borrower. (b) Representations and Warranties. The representations and warranties of the Loan Parties set forth in this Agreement and the Loan Documents shall be true and correct in all material respects on and as of the date of such borrowing, except to the extent they relate to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date. (c) No Default. At the time of and immediately after giving effect to such borrowing, no Default or Event of Default shall have occurred and be continuing. (d) Certificate. With respect to each Term Loan the proceeds of which will be used to fund an Investment, the Administrative Agent (which shall forward the same to the Lenders) shall have received a certificate of the Borrower setting forth in reasonable detail, and to the Borrower's knowledge, information with respect to the following items: (i) a description of such Investment; (ii) the total cost of such Investment; (iii) the amount, maturity, source and collateral security for all debt, equity and other financing for such Investment; and (iv) the name, form of organization and jurisdiction of organization of the applicable New Portfolio Company and any Investment Party and the respective direct ownership interests of the Borrower, each Investment Party and the New Portfolio Company and their respective subsidiaries. In addition, the Administrative Agent (which shall forward the same to the Lenders) shall receive from the Borrower: (i) a copy of all purchase documents relating to the applicable Investment and (ii) such other information reasonably requested by the Lenders regarding the applicable Investment, the applicable New Portfolio Company and the Investment Parties (if any). (e) Co-Investment. The amount of the borrowing shall not equal more than 97.02% of the Borrower's Investment in a Directly Owned Investment Party or New Portfolio Company as the case may be, and the Co-Investors shall have made the Co-Investment. 26 22 (f) Legal Opinion. The Administrative Agent shall have received an executed legal opinion from the Loan Parties' outside counsel, as to all matters reasonably requested by Administrative Agent including, without limitation, (a) Regulation U and (b) perfection of the Administrative Agent's security interest in the Investment pledged by the Borrower of either the applicable New Portfolio Company or the applicable Directly Owned Investment Party, as the case may be. (g) Management and Advisory Agreements. The Administrative Agent shall have been provided a copy of each management and advisory agreement in respect of the New Fund or an Investment in a New Portfolio Company on the date of such borrowing. (h) Investment. Each Investment shall be reasonably expected by the Loan Parties to be suitable for purchase by New Fund (the determination of which will include a determination that the Investment would have been suitable for purchase by any Specified Fund and is consistent with past investments by the Specified Funds). Each borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraphs (b) and (c) of this Section. ARTICLE 5 Covenants Until the principal of and interest on each Term Loan and all other amounts payable hereunder shall have been paid in full and the Commitments are terminated, the Borrower covenants and agrees with the Lenders that: SECTION 5.1 Notices of Material Events. The Borrower will furnish to the Administrative Agent and each Lender prompt written notice of the following: (a) the occurrence of any Default or Event of Default; (b) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Loan Party or any Affiliate thereof that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect; and (c) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect. Each notice delivered under this Section shall be accompanied by a statement of the Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto. SECTION 5.2 Existence; Conduct of Business. The Borrower will do or cause to be done all things necessary to preserve, renew and keep in full force and effect (a) its legal existence and (b) the rights, licenses, permits, privileges and franchises material to the conduct of its business. SECTION 5.3 Payment of Obligations. The Borrower will pay its material obligations, including material tax liabilities, before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower has set aside on its books adequate reserves with respect thereto in accordance with GAAP and 27 23 (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect. SECTION 5.4 Compliance with Laws. The Borrower will comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. SECTION 5.5 Use of Proceeds. The proceeds of the Term Loans will be used only to finance Permitted Investments in New Portfolio Companies, Investments in Directly Owned Investment Parties (for the purpose of enabling the relevant Directly Owned Investment Party to make a Permitted Investment) and the payment of interest, fees and expenses due hereunder; provided that (a) Term Loans may not be borrowed for the purpose of making any such Investment if the aggregate Investment Commitment Amount (after giving effect to such Term Loan) would exceed the aggregate Commitments and (b) the aggregate principal amount of Term Loans borrowed in connection with such Investments shall be limited as follows: (i) approximately $21,000,000 in the case of the Globix Investment, (ii) approximately $25,000,000 in the case of the Library Services Investment, (iii) approximately $52,000,000 in the case of the Teligent Investment and (iv) approximately $12,000,000 in the case of any other Investments. No part of the proceeds of any Term Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations G, U and X. SECTION 5.6 Additional Collateral. With respect to any Investment in a New Portfolio Company or a Directly Owned Investment Party made by the Borrower after the Closing Date, the Borrower will promptly (i) execute and deliver to the Administrative Agent, for the benefit of the Lenders, such Pledge Supplements to the Pledge Agreement or such other documents as the Administrative Agent shall deem necessary or advisable to grant to the Administrative Agent, for the benefit of the Lenders, a Lien on the Capital Stock of such New Portfolio Company or such Directly Owned Investment Party which is owned by the Borrower, (ii) deliver to the Administrative Agent the stock certificates, notes or other evidence of ownership representing the Investment in such New Portfolio Company or such Directly Owned Investment Party owned by the Borrower, together with undated stock or transfer powers, executed and delivered in blank, for any stock certificates or notes representing such Investment, by a Responsible Officer of the Borrower, (iii) take all actions necessary or advisable to cause such Lien to be duly perfected in accordance with all applicable Requirements of Law, including, without limitation, the filing of financing statements in such jurisdictions as may be required by the Pledge Agreement or by law or as may be requested by the Administrative Agent and (iv) if reasonably requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating to the matters described in clauses (i), (ii) and (iii) immediately preceding, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Administrative Agent. SECTION 5.7 Financial Reporting. The Borrower will provide to the Administrative Agent, for distribution to the Lenders, each of the financial statements and related certificates and other business and financial information distributed to the Borrower or its Affiliates by any New Portfolio Company, as well as such additional information as the Lenders may reasonably request hereunder. SECTION 5.8 Additional Guarantors. Within ten (10) Business Days after the formation of any Guarantor or the date such entity becomes a Guarantor within the definition of Guarantor set forth in Section 1.1 hereof, the Borrower shall cause such Guarantor to execute and deliver to the Administrative Agent an Affiliate Guarantee substantially in the form of Exhibit D attached hereto. 28 24 ARTICLE 6 Negative Covenants Until the principal of and interest on each Term Loan and all other amounts payable hereunder shall have been paid in full and the Commitments are terminated, the Borrower covenants and agrees with the Lenders that: SECTION 6.1 Indebtedness. The Borrower will not, and will not permit any Investment Party to, create, incur, assume or permit to exist any Indebtedness, except (a) Indebtedness created hereunder and under the other Loan Documents, (b) nonconsensual obligations imposed by operation of law, (c) indemnification obligations arising under the Borrower's constituent documents, and (d) administrative expenses and taxes. SECTION 6.2 Liens. The Borrower will not, and will not permit any Investment Party to, create, incur, assume or permit to exist any Lien (other than Liens created pursuant to the Pledge Agreement) on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof other than (a) Liens for taxes not yet due or which are being contested in good faith by appropriate proceedings, provided that adequate reserves with respect thereto are maintained on the books of the Borrower in accordance with GAAP, (b) Liens in favor of banking institutions arising as a matter of law and encumbering the deposits (including the right of setoff) held by such banking institutions in the ordinary course of business and which are within the general parameters customary in the banking industry, and (c) attachment and judgement Liens not constituting an Event of Default. SECTION 6.3 Fundamental Changes. (a) The Borrower will not, and will not permit any Investment Party to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or dissolve. (b) The Borrower will not engage in any business other than a business consistent with its current operations and activities on the date of execution of this Agreement. SECTION 6.4 Restricted Payments. The Borrower will not, and will not permit any Investment Party to, make any Restricted Payments (except that the Investment Parties may make Restricted Payments to the Borrower to repay Term Loans and other amounts due hereunder and the Borrower may make Restricted Payments to a Co-Investor in respect of any Co-Investment amount with proceeds funded by a Co-Investor). SECTION 6.5 Sale of Assets. The Borrower shall not and will not permit any Investment Party to sell, transfer or otherwise dispose of any of its property other than for cash (yielding net proceeds) representing at least Borrower's or such Investment Party's cost of such property (including, without limitation, any interest and fees relating thereto), the net proceeds (less the ratable interest of any Co-Investors and any necessary escrows) of which (to the extent attributable to the Investment) are distributed to the Borrower to repay the Term Loans. 29 25 ARTICLE 7 Events of Default If any of the following events ("Events of Default") shall occur: (a) the Borrower shall fail to pay any principal of any Term Loan when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise; (b) the Borrower shall fail to pay any interest on any Term Loan or to pay any Fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under or in connection with this Agreement, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of five days; (c) any representation or warranty made or deemed made by or on behalf of any Loan Party in or in connection with any Loan Document or any amendment or modification thereof, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with any Loan Document or any amendment or modification thereof, shall prove to have been incorrect in any material respect when made or deemed made; (d) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.2(a) or Article 6 or any Guarantor shall fail to observe or perform any covenant, condition or agreement contained in Section 10(a)(i) or (d) of its Affiliate Guarantee; (e) any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document (other than those specified in clause (a), (b), (c), (d) or (g) of this Article), and such failure shall continue unremedied for a period of 30 days; (f) any Loan Party, Investment Party, or any New Portfolio Company shall (i) default in making any payment of any principal of or interest on any Indebtedness (including any Guarantee, but excluding the Term Loans and Guarantees pursuant to the Affiliate Guarantees) beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created; or (ii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or (in the case of any such Indebtedness constituting a Guarantee) to become payable; provided that a default, event or condition described in clause (i) or (ii) of this paragraph (f) shall not at any time constitute an Event of Default under this Agreement unless, at such time, one or more defaults, events or conditions (without duplication as to the same item of Indebtedness) of the type described in clauses (i) and (ii) of this paragraph (f) shall have occurred and be continuing with respect to Indebtedness the outstanding principal amount of which exceeds in the aggregate $500,000 in the case of the Borrower or $10,000,000 in the case of any New Portfolio Company, Investment Party or any other Loan Party; or (g) (i) any Loan Party, Investment Party, or any New Portfolio Company shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or 30 26 seeking reorganization, windingup, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or any Loan Party, Investment Party or any New Portfolio Company shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against any Loan Party, Investment Party or any New Portfolio Company, any case, proceeding or other action of a nature referred to in clause (i) above which (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall be commenced against any Loan Party, Investment Party or any New Portfolio Company any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets which results in the entry of an order for any such relief which shall not have been vacated, discharged, or stayed or bonded pending appeal within 60 days from the entry thereof; or (iv) any Loan Party shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) any Loan Party, Investment Party or any New Portfolio Company shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; or (h) one or more judgments or decrees shall be entered against any Loan Party, Investment Party or New Portfolio Company involving in the aggregate a liability (not paid or fully covered by insurance as to which the relevant insurance company has not denied coverage) of $500,000 or more in the case of the Borrower and $10,000,000 or more in the case of any New Portfolio Company, Investment Party or any other Loan Party, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from the entry thereof; or (i) any Loan Document shall, at any time, cease to be in full force and effect (unless released by the Administrative Agent at the direction of the Required Lenders or as otherwise permitted under this Agreement or the other Loan Documents) or shall be declared null and void, or the validity or enforceability thereof shall be contested by any Loan Party; or (j) any Person constituting a "Guarantor" shall not be a party to an Affiliate Guarantee within ten Business Days after such Person has been organized or formed; (k) a Change in Control shall occur; or (l) any Investment Party shall fail to distribute any payment made to it on account of any Investment (net of reasonable expenses and reasonably required escrows); then, and in every such event (other than an event with respect to the Borrower described in clause (g) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, declare the Term Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable) and the Commitments to be terminated, and thereupon the principal of the Term Loans so declared to be due and payable, together with accrued interest thereon and all other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and in case of any event with respect to the Borrower described in clause (g) of this Article, the principal of the Term Loans then outstanding, together with accrued interest thereon and all other obligations of the Borrower accrued hereunder, shall automatically become due and payable and the Commitments shall be automatically terminated, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and at any 31 27 time thereafter during the continuance of such event, the Administrative Agent may exercise all of its rights and remedies under the Pledge Agreement in accordance with all applicable laws. ARTICLE 8 The Administrative Agent Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such actions and powers as are reasonably incidental thereto. The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with any Loan Party or any Affiliate thereof as if it were not the Administrative Agent hereunder. The Administrative Agent shall not have any duties or obligations except those expressly set forth herein. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in writing by the Required Lenders, and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Loan Party or any of its Affiliates that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders or in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement, (ii) the contents of any certificate, report or other document delivered hereunder or in connection herewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article 4 or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts. The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Administrative Agent. The 32 28 Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent. Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent may resign at any time by notifying the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor, which successor shall be approved by the Borrower (which approval shall not be unreasonably withheld or delayed). If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent which shall be a bank reasonably acceptable to the Borrower. Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder. Any fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the Administrative Agent's resignation hereunder, the provisions of this Article and Section 9.3 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Administrative Agent. Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder. ARTICLE 9 Miscellaneous SECTION 9.1 Notices. Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be in writing (including by facsimile transmission) and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made (a) in the case of delivery by hand, when delivered, (b) in the case of delivery by mail, three days after being deposited in the mails, postage prepaid, or (c) in the case of delivery by facsimile transmission, when sent and receipt has been confirmed, addressed as follows: (a) if to the Borrower, to it c/o HMTF Operating, Inc., 200 Crescent Court, Suite 1600, Dallas, Texas 75201, Attention: Lawrence D. Stuart, Jr. (Telecopy No. 214-740-7313); (b) if to the Administrative Agent, to [Bank]; and 33 29 (c) if to any Lender, to it at its address (or telecopy number) set forth in an administrative questionnaire delivered to the Administrative Agent and as otherwise notified in writing to the Borrower. Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt. SECTION 9.2 Waivers; Amendments. (a) No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Term Loan shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time. (b) Neither any Loan Document nor any provision thereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Required Lenders and each affected Loan Party; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the amount of, or extend any scheduled date for payment of, any principal or interest in respect of the Term Loans, without the written consent of each Lender directly affected thereby, (iii) change any of the provisions of this Section or the definition of "Required Lenders" without the written consent of each Lender, (iv) release any Loan Party from its obligations under the Loan Documents without the written consent of each Lender (except upon payment in full in cash of the Obligations) or (v) release all or substantially all of the collateral (except as expressly provided in the Loan Documents) under the Affiliate Guarantees and the Pledge Agreement (provided that a partial release of collateral thereunder shall require the consent of the Required Lenders); provided, further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent hereunder without the prior written consent of the Administrative Agent. SECTION 9.3 Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay or cause to be paid (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the administration of this Agreement or any amendments, modifications or waivers of the provisions hereof and (ii) all reasonable out-of-pocket expenses incurred by the Administrative Agent or any Lender, including the reasonable fees, charges and disbursements of any counsel for the Administrative Agent or any Lender, in connection with the enforcement or protection of its rights in connection with the Loan Documents, including in connection with any workout, restructuring or negotiations in respect thereof, the reasonable fees and disbursements of counsel to the Administrative Agent and after the occurrence and during the continuance of an Event of Default a single counsel to the Lenders collectively. (b) The Borrower shall indemnify the Administrative Agent and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an "Indemnitee") against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable the fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the 34 30 execution or delivery of the Loan Documents or any agreement or instrument contemplated thereby, the performance by the parties thereto of their respective obligations under the Loan Documents or the consummation of the Transactions or any other transactions contemplated by the Loan Documents, (ii) any Term Loan or the use of the proceeds therefrom, or (iii) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or, in the case of any indemnified liabilities arising out of this Agreement or the other Loan Documents, from the material breach by any such Indemnitee of this Agreement or the other Loan Documents, as the case may be; provided that, for purpose of clarity, no provision of this paragraph (b) shall be deemed to negate Section 9.3(a)(ii) to the extent that it provides that after the occurrence and during the continuance of an Event of Default, the Lenders shall be reimbursed for a single counsel. (c) To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent, each Lender severally agrees to pay to the Administrative Agent such Lender's Loan Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such. (d) To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Term Loan or the use of the proceeds thereof. (e) The agreements in this Section 9.3 shall survive repayment of the Loans and all other amounts payable hereunder. SECTION 9.4 Successors and Assigns. (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement. (b) Any Lender may assign to one or more assignees a portion of its rights and obligations under this Agreement (an "Assignee"); provided that (i) except in the case of an assignment to a Lender or an Affiliate of a Lender, each of the Borrower (such consent not to be unreasonably withheld) and the Administrative Agent (the consent of the Administrative Agent may be withheld in its sole discretion) must give their prior written consent to such assignment, (ii) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender's Commitment and Term Loans, the amount of the Term Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 unless each of the Borrower and the Administrative Agent otherwise consent, (iii) the parties to each assignment shall 35 31 execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee of $4,000 (provided, however, if the Borrower requests the replacement of any Lender pursuant to Section 2.16 hereof, the Borrower shall pay such processing and recordation fee, which shall be funded with the proceeds of the Term Loans), and (iv) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an administrative questionnaire; provided further that any consent of the Borrower otherwise required under this paragraph shall not be required if an Event of Default under clause (g) of Article 7 has occurred and is continuing. Upon acceptance and recording pursuant to paragraph (d) of this Section, from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.12, 2.13, 2.14 and 9.3). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (e) of this Section. (c) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices in New York, New York a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Term Loans whether or not evidenced by a Note owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. Any assignment of any Loan whether or not evidenced by a Note shall be effective only upon appropriate entries with respect thereto being made in the Register (and each Note shall expressly so provide). Any assignment or transfer of all or part of a Loan evidenced by a Note shall be registered on the Register only upon surrender for registration of assignment or transfer of the Note evidencing such Loan, accompanied by a duly executed Assignment and Acceptance, and thereupon one or more new Notes in the same aggregate principal amount shall be issued to the designated Assignee and the old Notes shall be returned by the Administrative Agent to the Borrower marked "cancelled". (d) Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning Lender and an assignee, the assignee's completed administrative questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Acceptance and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph. (e) Any Lender may, without the consent of the Borrower but with the consent of the Administrative Agent (the consent of the Administrative Agent may be withheld in its sole discretion) sell participations to one or more banks or other entities (a "Participant") in all or a portion of such Lender's rights and obligations under this Agreement (including all or a portion of its Commitment and the Term Loans owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall 36 32 provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.2(b) that affects such Participant. Subject to paragraph (f) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that, in the case of Section 2.13, such Participant shall have complied with the requirements of said Section and provided, further, that no Participant shall be entitled to receive any greater amount pursuant to any such Section than the transferor Lender would have been entitled to receive in respect of the amount of the participation transferred by such transferor Lender to such Participant had no such transfer occurred. (f) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any such pledge or assignment to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such assignee for such Lender as a party hereto. SECTION 9.5 Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Term Loans, regardless of any investigation made by any such other party or on its behalf. SECTION 9.6 Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts and by facsimile (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and any separate agreements with respect to Fees constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. SECTION 9.7 Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. SECTION 9.8 Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by such Lender to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have. SECTION 9.9 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. 37 33 (b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement against the Borrower or its properties in the courts of any jurisdiction. (c) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. (d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.1. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law. SECTION 9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. SECTION 9.11 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement. SECTION 9.12 Confidentiality. Each Lender agrees to keep information obtained by it pursuant hereto and the other Loan Documents identified as confidential in writing at the time of delivery confidential in accordance with such Lender's customary practices and agrees that it will only use such information in connection with the transactions contemplated by this Agreement and not disclose any of such information other than (a) to such Lender's employees, representatives, directors, attorneys, auditors, agents or affiliates who are advised of the confidential nature of such information, (b) to the extent such information presently is or hereafter becomes available to such Lender on a non-confidential basis from any source or such information that is in the public domain at the time of disclosure, (c) to the extent disclosure is required by law (including applicable securities laws), regulation, subpoena or judicial order 38 34 or process (provided that notice of such requirement or order shall be promptly furnished to the Borrower unless such notice is legally prohibited) or requested or required by bank, securities or investment company regulations or auditors or any administrative body or commission to whose jurisdiction such Lender may be subject, (d) to actual or prospective assignees or Participants who agree to be bound by the provisions of this Section 9.12, (e) to the extent required in connection with any litigation between any Loan Party and any Lender with respect to the Term Loans or this Agreement and the other Loan Documents or (f) with the Borrower's prior written consent. The agreements in this Section 9.12 shall survive repayment of the Term Loans and all other amounts payable hereunder. Each of the parties hereto (each, a "Document Party") agrees to keep confidential this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby; provided that nothing herein shall prevent any Document Party from disclosing such information (a) to any other Document Party or any Affiliate of any Document Party, or any officer, director, employee, agent, or advisor of any Document Party or Affiliate of any Document Party, (b) to any other Person if reasonably incidental to the administration of the credit facility provided herein, (c) as required by any law, rule, or regulation, (d) upon the order of any court or administrative agency, (e) upon the request or demand of any regulatory agency or authority, (f) to any New Portfolio Company (or prospective New Portfolio Company) or any officer, director, employee, agent, or advisor of any Document Party or Affiliate of such New Portfolio Company in connection with a proposed Investment by the Borrower in such New Portfolio Company, (g) in connection with any litigation to which such Document Party or any of its Affiliates may be a party, or (h) to the extent necessary in connection with the exercise of any remedy under this Agreement or any other Loan Document. SECTION 9.13 Syndication. The Borrower agrees that the Administrative Agent has the right to syndicate the Commitments and the Term Loans at any time or from time to time to a group of financial institutions (the "Additional Lenders") identified by the Administrative Agent in consultation with the Borrower, if the Administrative Agent and its affiliates determine to syndicate the Commitments and the Term Loans. The Borrower agrees to actively assist the Administrative Agent and its affiliates in completing a syndication satisfactory to the Administrative Agent and the Borrower, including (a) using commercially reasonable efforts to ensure that the syndication efforts benefit materially from the Borrower's lending and equity relationships, (b) direct contact between the Borrower and any Additional Lenders, (c) furnishing, or, as the Administrative Agent may request, assisting in the preparation of, information, projections and marketing materials to be used in connection with the syndication and (d) the hosting, with the Administrative Agent and its affiliates, of one or more meetings of any Additional Lenders. The Administrative Agent and its affiliates would manage all aspects of the syndication, in consultation with the Borrower, including decisions as to the selection of institutions to be approached and when they will be approached, when their commitments will be accepted, which institutions will participate, the allocations of the commitments among any Additional Lenders and the amount and distribution of fees among any Additional Lenders. The Borrower acknowledges that the information the Borrower may be asked to furnish to the Administrative Agent and its affiliates and to any Additional Lenders may include sensitive competitive information, and the Administrative Agent and its affiliates agree to take appropriate and customary confidentiality precautions with respect thereto. 39 35 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written. HMTF BRIDGE PARTNERS, L.P., a Delaware limited partnership By: HMTF BRIDGE PARTNERS, LLC, a Texas limited liability company /s/ Darron K. Ash ----------------------------------------- Darron K. Ash Chief Financial Officer Address for Notices: 200 Crescent Court, Suite 1600 Dallas, Texas 75201 Attn: Lawrence D. Stuart, Jr. Telecopy: (214) 740-7313 40 36 [Bank], as Administrative Agent and as a Lender By: /s/ [Bank] ------------------------------------- Name: [Bank] Title: Vice President 41 SCHEDULE 2.1
================================================================== LENDER COMMITMENT - ------------------------------------------------------------------ [Bank] $110,000,000.00 - ------------------------------------------------------------------ TOTAL COMMITMENTS $110,000,000.00 ==================================================================
EX-99.1 4 JOINT FILING AGREEMENT 1 EXHIBIT 99.1 JOINT FILING STATEMENT Each of the undersigned agrees that (i) the statement on Schedule 13D relating to the Common Stock, par value $.01 per share, of Globix Corporation has been adopted and filed on behalf of each of them, (ii) all future amendments to such statement on Schedule 13D will, unless written notice to the contrary is delivered as described below, be jointly filed on behalf of each of them, and (iii) the provisions of Rule 13d-1(k)(1) under the Securities Exchange Act of 1934 apply to each of them. This agreement may be terminated with respect to the obligations to jointly file future amendments to such statement on Schedule 13D as to any of the undersigned upon such person giving written notice thereof to each of the other persons signatory hereto, at the principal office thereof. December 10, 1999 * ----------------------------------- Name: Thomas O. Hicks * By: /s/ David W. Knickel ------------------------------ Name: David W. Knickel Attorney-in-Fact HM4 GLOBIX QUALIFIED FUND, LLC By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HMTF EQUITY FUND IV (1999), L.P. By: HM4/GP (1999) Partners, L.P., its General Partner By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HM4 GLOBIX PRIVATE FUND, LLC By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President 1 2 HMTF PRIVATE EQUITY FUND IV (1999), L.P. By: HM4/GP (1999) Partners, L.P., its General Partner By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HM4/GP (1999) PARTNERS, L.P. By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HM 4-EQ GLOBIX COINVESTORS, LLC By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HM 4-EQ (1999) COINVESTORS, L.P. By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President 2 3 HM 4-SBS GLOBIX COINVESTORS, LLC By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HM 4-SBS (1999) COINVESTORS, L.P. By: Hicks, Muse GP (1999) Partners IV, L.P., its General Partner By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HICKS, MUSE GP (1999) PARTNERS IV, L.P. By: Hicks, Muse (1999) Fund IV, LLC, its General Partner By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HICKS, MUSE (1999) FUND IV, LLC By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President HM PG-IV GLOBIX, LLC By: /s/ David W. Knickel -------------------------------- Name: David W. Knickel Title: Vice President 3 4 HICKS, MUSE PG-IV (1999), C.V. By: HM Equity Fund IV/GP Partners (1999), C.V., its General Partner By: HM GP Partners IV Cayman, L.P., its General Partner By: HM Fund IV Cayman LLC, its General Partner By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President HM EQUITY FUND IV/GP PARTNERS (1999), C.V. By: HM GP Partners IV Cayman, L.P., its General Partner By: HM Fund IV Cayman LLC, its General Partner By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President HM GP PARTNERS IV CAYMAN, L.P. By: HM Fund IV Cayman LLC, its General Partner By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President HM FUND IV CAYMAN LLC By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President HMTF BRIDGE GLOBIX, LLC By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President 4 5 HMTF BRIDGE PARTNERS, L.P. By: HMTF Bridge Partners, LLC, its General Partner By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President HMTF BRIDGE PARTNERS, LLC By: /s/ David W. Knickel --------------------------------- Name: David W. Knickel Title: Vice President 5 -----END PRIVACY-ENHANCED MESSAGE-----