FairPoint Communications 2002 Annual Report Download - page 234

SECTION 1A. LETTERS OF CREDIT.
1A.01 LETTERS OF CREDIT. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request that a Letter of Credit
Issuer at any time and from time to time on or after the Restatement Effective
Date and prior to the date which is thirty Business Days prior to the Final
Maturity Date issue, for the account of the Borrower and in support of such
obligations of the Borrower and/or its Subsidiaries that are incurred in the
ordinary course of business or are acceptable to the Administrative Agent and,
subject to and upon the terms and conditions herein set forth, such Letter of
Credit Issuer agrees to issue from time to time, irrevocable standby letters of
credit (each such letter of credit, a "LETTER OF CREDIT" and, collectively, the
"LETTERS OF CREDIT") denominated in Dollars and issued on a sight basis, in such
form as may be approved by such Letter of Credit Issuer and the Administrative
Agent.
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall
be issued if after giving effect thereto (x) the Letter of Credit Outstandings
would exceed $5 million or (y) the sum of all Letter of Credit Outstandings
(less any portion thereof subject to Section 1A.0 1(c) Arrangements) and the
then aggregate outstanding principal amount of all RF Loans made by
Non-Defaulting Lenders would exceed the Adjusted Total Revolving Commitment at
such time and (ii) each Letter of Credit shall have an expiry date occurring not
later than one year after such Letter of Credit's date of issuance, PROVIDED
that any such Letter of Credit may be extendible for successive periods of up to
one year on terms acceptable to the respective Letter of Credit Issuer and in no
event shall any Letter of Credit have an expiry date occurring later than ten
Business Days prior to the Final Maturity Date.
(c) Notwithstanding the foregoing, in the event a Lender Default
exists, the respective Letter of Credit Issuer shall not be required to issue
any Letter of Credit unless such Letter of Credit Issuer has entered into
arrangements satisfactory to it and the Borrower ("SECTION 1A.01(c)
ARRANGEMENTS") to eliminate such Letter of Credit Issuer's risk with respect to
the participation in Letters of Credit of the Defaulting Lender or Lenders,
which may include requiring that the Borrower cash collateralize such Defaulting
Lender's or Lenders' Percentage of the Letter of Credit Outstandings.
(d) Annex IX hereto contains a description of all letters of
credit issued pursuant to the Original Credit Agreement and outstanding on the
Restatement Effective Date. Each such letter of credit, including any extension
or renewal thereof (each, as amended from time to time in accordance with the
terms hereof and thereof, an "EXISTING LETTER OF CREDIT") shall constitute a
"Letter of Credit" for all purposes of this Agreement, issued, for purposes of
Sections 1A.04(a) and 1A.05, on the Restatement Effective Date.
1A.02 MINIMUM STATED AMOUNT. The initial Stated Amount of each
Letter of Credit shall be not less than $100,000 or such lesser amount as is
acceptable to the respective Letter of Credit Issuer.
1A.03 LETTER OF CREDIT REQUESTS; NOTICES OF ISSUANCE. (a) Whenever
it desires that a Letter of Credit be issued, the Borrower shall give the
Administrative Agent and the respective Letter of Credit Issuer written notice
(which may include by way of facsimile transmission) in the form of Exhibit J
hereto prior to 1:00 P.M. (New York time) at least three
Business Days (or such shorter period as may be acceptable to such Letter of
Credit Issuer) prior to the proposed date of issuance (which shall be a Business
Day) (each, a "LETTER OF CREDIT REQUEST"), which Letter of Credit Request shall
include any documents that such Letter of Credit Issuer customarily requires in
connection therewith.
(b) Each Letter of Credit Issuer shall, promptly after each
issuance or amendment of a Letter of Credit by it, notify the Administrative
Agent and the Borrower in writing of such issuance or amendment, and such notice