UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): December 22,
2009
___________________
Shenandoah
Telecommunications Company
(Exact
name of registrant as specified in its charter)
__________________
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Virginia
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0-9881
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54-1162807
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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500
Shentel Way
P.O.
Box 459
Edinburg,
VA
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22824
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (540) 984-4141
Not
applicable
(Former
name or former address, if changed since last report.)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2-(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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1
Item
1.01 Entry into a Material Definitive Agreement
On
December 22, 2009, the Company amended the $52 million Delayed Draw Term Loan
(the “Facility”) from CoBank that the Company had entered into in October
2008. This amendment extends the time period over which the Company
may make draws on the facility through December 31, 2010 from the original date
of December 31, 2009. The amendment also delays the beginning of the
repayment period by one year, thereby shortening the repayment period from six
years to five years. The outstanding balance under the Facility as of
December 31, 2010, will be repaid in 20 equal quarterly installments commencing
March 31, 2011. All other terms of the Facility remain
unchanged.
A copy of
the document underlying this Amendment to the Facility is attached as Exhibit
10.41.
Item
9.01 Financial Statements and Exhibits.
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(c)
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Exhibits
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Second
Agreement Regarding Amendments to Loan Documents and Consent to the Master
Loan Agreement dated as of November 30, 2004, between CoBank, ACB and
Shenandoah Telecommunications
Company.
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
SHENANDOAH
TELECOMMUNICATIONS COMPANY
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(Registrant)
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||||
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December
23, 2009
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/S/
Adele M. Skolits
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Adele
M. Skolits
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||||
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Vice
President - Finance and
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Chief
Financial Officer
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(Duly Authorized
Officer)
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2
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Exhibit
10.41
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Loan
No. ML 0743
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SECOND
AGREEMENT REGARDING AMENDMENTS TO LOAN DOCUMENTS AND CONSENT
This
SECOND AGREEMENT REGARDING
AMENDMENTS TO LOAN DOCUMENTS AND CONSENT (this "Amendment
Agreement"),
dated as of December 22, 2009, is between SHENANDOAH TELECOMMUNICATIONS COMPANY
(the "Borrower") and COBANK, ACB ("CoBank")
RECITALS
WHEREAS, the Borrower and
CoBank are parties to that certain Second Amended and Restated Master Loan
Agreement, dated as of November 30, 2004 (as amended by that certain letter
agreement, dated as of October 26, 2007, that certain Agreement Regarding
Amendments and Consents Regarding Loan Documents, dated as of October 22, 2008
(the "First
Amendment Agreement"),
and as further amended, modified, supplemented, extended or restated from
time to time, the "MLA"), as
supplemented by that certain Term Supplement to the Master Loan Agreement, dated
as of June 22, 2001, providing for a loan in the amount of $45,965,689.85 (as
amended by that certain First Amendment to Term Supplement, dated as of
September 1, 2001, that certain Second Amendment to Term Supplement, dated as of
November 30, 2007, the First Amendment Agreement and as further amended,
modified, supplemented, extended or restated from time to time, the "Term
Supplement"),
that certain Third Supplement to the Master Loan Agreement, dated as of
November 30, 2004, providing for a reducing revolving loan of up to
$15,000,000.00 (as amended by that certain letter agreement, dated as of July 1,
2007, the Amendment Agreement and as further amended, modified, supplemented,
extended or restated from time to time, the "Third
Supplement") and
that certain Fourth Supplement to the Master Loan Agreement, dated as of October
22, 2008, providing for a delayed draw term loan in the amount of $52,000,000
(as the same may be amended, modified, supplemented, extended or restated from
time to time, the "Fourth
Supplement"; the
MLA, as supplemented by the Term Supplement, the Third Supplement and the Fourth
Supplement, collectively, the "Loan
Agreement");
WHEREAS, as security for the
Borrower's obligations under the Loan Agreement, the Borrower executed and
delivered that certain Second Amended and Restated Pledge Agreement, dated as of
November 30, 2004 (as amended by the First Amendment Agreement and as further
amended, modified, supplemented, extended or restated from time to time, the
"Pledge
Agreement"),
pursuant to which the Borrower granted to CoBank a security interest in
and lien on the property described therein; and
WHEREAS, the Borrower and
CoBank have agreed to certain amendments to the Loan Agreement and Pledge
Agreement, as set forth herein.
Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
NOW, THEREFORE, in
consideration of the foregoing and the agreements set forth in this Amendment
Agreement, the Borrower and CoBank each hereby agree as follows:
SECTION 1. Capitalized terms
used herein and not otherwise defined herein shall have the meanings ascribed to
them in the Loan Agreement.
SECTION 2. Subsection 6(K) of
the MLA is hereby amended by inserting "including, without limitation, the
Pledge Agreement entered into by Shenandoah Cable Television Company" before the
parenthetical defining "Other Pledge Agreements."
SECTION 3. Subsection 7(M) of
the MLA is hereby amended by amending and restating such Subsection to read in
its entirety as follows:
Capital. Acquire equity in
CoBank in such amounts and at such times as CoBank may from time to time require
in accordance with its Bylaws and Capital Plan (as each may be amended from time
to time), except that the maximum amount of equity that the Borrower may be
required to purchase in connection with a Loan may not exceed the maximum amount
permitted by the Bylaws at the time the Supplement relating to such Loan is
entered into or such Loan is renewed or refinanced by CoBank. The rights and
obligations of the parties with respect to such equity and any patronage or
other distributions made by CoBank shall be governed by CoBank's Bylaws and
Capital Plan (as each may be amended from time to time).
SECTION 4. Schedule 6(N) of
the MLA is hereby amended by replacing such Schedule 6(N) with the Schedule 6(N)
attached hereto as Exhibit
A.
SECTION 5. Each of Section 7
of the Term Supplement, Section 9 of the Third Supplement and Section 9 of the
Fourth Supplement is hereby amended by amending and restating such Section to
read in its entirety as follows:
The Loan
is secured by (i) the Second Amended and Restated Pledge Agreement, dated as of
November 30, 2004, between the Borrower and CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the "Borrower Pledge Agreement")
and (ii) the Pledge Agreement, dated as of December 22, 2009, between
Shenandoah Cable Television Company and CoBank (as the same may be amended,
modified, supplemented, extended or restated from time to time, the "Shenandoah Cable Pledge Agreement";
and together with the Borrower Pledge Agreement, the "Pledge Agreement"), pursuant
to which each of the Borrower and Shenandoah Cable Television Company has
granted CoBank a first-priority lien and security interest in all of its now
owned or hereafter acquired capital stock or other voting securities in the
Pledged Subsidiaries (as defined in the Pledge Agreement).
2
Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
SECTION 6. Section 1 of the
Fourth Supplement is hereby amended by extending the Termination Date from
"December 31, 2009" to "December 31, 2010."
SECTION 7. Subsection 6(B) of
the Fourth Supplement is hereby amended by amending and restating such
Subsection to read in its entirety as follows:
(B) Scheduled Repayments.
Commencing on March 31, 2011, and on each June 30, September 30, December
31, and March 31 occurring thereafter (each such date, a "Payment
Date") through
December 31, 2015 (the "Maturity
Date"), the
outstanding principal balance of the Loan as of the Termination Date shall be
repaid in 20 equal installments on each such Payment Date (any such repayments
will be cumulative and will be in addition to any other repayments pursuant to
the MLA or this Fourth Supplement). If any Payment Date is not a Business Day,
then the installment then due shall be paid not later than the next Business Day
and shall continue to accrue interest until paid.
SECTION 8. Subsection 2(a) of
the Pledge Agreement is hereby amended by amending and restating such Subsection
to read in its entirety as follows:
(a) all
capital stock of Shenandoah Telephone Company, Shenandoah Cable Television
Company, ShenTel Service Company, Shenandoah Personal Communications Company,
Shenandoah Wireless Company (formerly known as Shenandoah Valley Leasing
Company), Shenandoah Mobile Company, Shenandoah Long Distance Company, ShenTel
Communications Company, Shenandoah Network Company, ShenTel Converged Services
of West Virginia, Inc., Shentel Converged Services, Inc. and Shentel Management
Company now owned or hereafter acquired by the Pledgor, and any other
corporation of which the Pledgor now owns or hereafter acquires fifty percent
(50%) or more of the issued and outstanding capital stock (all such
corporations, collectively, the "Pledged Subsidiaries") and
SECTION 9. Schedule 1 to the
Pledge Agreement is hereby amended and restated in its entirety by replacing
such Schedule 1 with the Schedule 1 attached hereto as Exhibit B.
SECTION 10. Pursuant to
Subsection 8(A)(4) of the MLA, the Borrower has, subject to certain exceptions,
covenanted not to sell, transfer, lease, enter into any contract for the sale,
transfer or lease of, or otherwise dispose of, any of its operating assets.
Pursuant to Subsection 4(c) of the Pledge Agreement, the Borrower has covenanted
not to consent to or approve of any merger, consolidation, reorganization or any
sale or lease of substantially all the assets of any of the Pledged
Subsidiaries. The Borrower has requested that CoBank consent to the transfer of
all of the equity interests in Shentel Cable Company from the Borrower to
Shenandoah Cable Television Company (the "Subsidiary
Transfer"). In
reliance on the representations, warranties and agreements provided and made by
the Borrower to CoBank herein and in connection with the request for such
consent, upon (a) Shenandoah Cable Television Company entering into a Pledge
Agreement in favor of CoBank pledging all of the equity interests in Shentel
Cable Company (the "Shenandoah
Cable Pledge Agreement"), the Shenandoah Cable
Pledge Agreement to be in form and substance satisfactory to CoBank in its sole
discretion, and (b) the satisfaction of all other conditions precedent to the
Effective Date of this Amendment Agreement, CoBank hereby (i) consents to the
Subsidiary Transfer, (ii) agrees that such transfer shall not count against the
$5,000,000 or $25,000,000 thresholds set forth in the proviso of Subsection
8(A)(4) and (iii) agrees to deliver to the Borrower for cancellation, upon the
Borrower's request, such original stock certificates, as are in CoBank's
possession, evidencing the Borrower's ownership of the equity interest in
Shentel Cable Company.
3
Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
SECTION 11. Neither this
Amendment Agreement nor any prior amendment to the Loan Agreement or other Loan
Documents shall constitute a novation of the Loan Agreement or the other Loan
Documents.
SECTION 12. All references to
the MLA, the Term Supplement, the Third Supplement and the Fourth Supplement or
the Pledge Agreement (collectively, the "Amended
Documents") in
any of the Amended Documents, or in any other documents, instruments or
agreements executed or delivered in connection therewith, shall be deemed a
reference to such Amended Document as amended by this Amendment Agreement.
Except as expressly provided in this Amendment Agreement, the execution and
delivery of this Amendment Agreement does not and will not amend, modify or
supplement any provision of, or constitute a consent to or a waiver of any
noncompliance with the provisions of, the Loan Agreement or the other Loan
Documents, and, except as specifically provided in this Amendment Agreement, the
Loan Agreement and the other Loan Documents shall remain in full force and
effect.
SECTION 13. The Borrower
hereby represents and warrants to CoBank as follows:
(a) Such
entity has the right and power, and has taken all necessary action to authorize
it, to execute, deliver and perform this Amendment Agreement in accordance with
its terms. This Amendment Agreement has been duly executed and delivered by such
entity and is a legal, valid and binding obligation of it, enforceable against
it in accordance with its terms.
(b)The
execution, delivery and performance of this Amendment Agreement in accordance
with its terms do not and will not, by the passage of time, the giving of notice
or otherwise,
(i) require
any governmental approval or violate any applicable Law relating to such
entity;
(ii) conflict
with, result in a breach of or constitute a default under the organizational
documents of such entity, any material provision of any indenture, agreement or
other instrument to which it is a party or by which it or any of its properties
may be bound or any governmental approval relating to it; or
4
Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
(iii) result
in or require the creation or imposition of any lien (except as permitted by the
Loan Agreement and the other Loan Documents) upon or with respect to any
property now owned or hereafter acquired by such entity.
(c) that,
after giving effect to the amendments and consent set forth in this Amendment
Agreement, the representations and warranties of such entity set forth in the
Loan Agreement and the other Loan Documents are true and correct as of the date
hereof as if made on the date hereof.
(d) no
Potential Default or Event of Default under the Loan Agreement and the other
Loan Documents has occurred and is continuing as of this date.
SECTION 14. The Borrower, as
the maker of the Loan Agreement and certain other Loan Documents, hereby
confirms and agrees that (a) each such document, as amended hereby, as
applicable, is and shall continue to be in full force and effect, and (b) the
obligations secured by each such document include any and all obligations of the
Borrower to CoBank under the Loan Agreement, as amended by this Amendment
Agreement.
SECTION 15. This Amendment
Agreement shall become effective as of the date of (the "Effective
Date"), and shall
bind all parties only upon, the satisfaction by the Borrower or the waiver by
CoBank of the following conditions precedent.
(a) Amendment Agreement. Receipt
by CoBank of this Amendment Agreement duly executed by the
Borrower;
(b) Pledge Agreement. Receipt by
CoBank of the Shenandoah Cable Pledge Agreement duly executed by Shenandoah
Cable Telephone Company;
(c) Stock Certificates and Stock Powers.
Receipt by CoBank of the stock certificates evidencing Shenandoah Cable
Television Company's ownership of all of the equity interests in Shentel Cable
Company, such stock certificates to be accompanied by duly executed stock powers
executed in blank;
(d) Amendment Fee. Receipt by
CoBank of an amendment fee in the amount of $15,000.00.
(e) Representations and Warranties.
That the representations and warranties of the Borrower contained in the
Loan Documents to which it is a party are true and correct in all material
respects on and as of the date hereof, as though made on and as of the date
hereof.
SECTION 16. This Amendment
Agreement shall become effective as of the Effective Date. All obligations and
rights of the Borrower and CoBank arising out of or relating to the period
commencing on the Effective Date shall be governed by the terms and provisions
of the Loan Agreement and the Pledge Agreement, each as amended by this
Amendment Agreement; the obligations of and rights of the Borrower and CoBank
arising out of or relating to the period prior to the Effective Date shall
continue to be governed by the Loan Agreement and the Pledge Agreement, as
applicable, without giving effect to the amendment provided for
herein.
5
Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
SECTION 17. The Borrower
agrees to pay CoBank, on demand, all out-of-pocket costs and expenses incurred
by CoBank, including, without limitation, the reasonable fees and expenses of
counsel retained by CoBank, in connection with the negotiation, preparation,
execution and delivery of this Amendment Agreement and all other instruments and
documents contemplated hereby.
SECTION 18. This Amendment
Agreement may be executed in any number of counterparts and by the different
parties hereto in separate counterparts, each of which when executed shall be
deemed to be an original and shall be binding upon all parties and their
respective permitted successors and assigns, and all of which taken together
shall constitute one and the same agreement. Delivery by facsimile or electronic
transmission by any of the parties hereto of an executed counterpart hereof
shall be as effective as an original executed counterpart hereof and shall be
enforceable against the parties hereto.
SECTION 19. Except to the
extent governed by applicable federal law, this Amendment Agreement shall be
governed by and construed in accordance with the laws of the State of Virginia,
without reference to choice of law doctrine.
[Signatures
on following page.]
6
Second Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
IN WITNESS WHEREOF, the
Borrower has caused this Amendment Agreement to be executed and delivered, and
CoBank has caused this Amendment Agreement to be executed and delivered, each by
its respective duly authorized officer as of the date first shown
above.
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SHENANDOAH
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TELECOMMUNICATIONS
COMPANY
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By
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/s/
Christopher E. French
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Christopher
E. French
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President
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[Signatures
continued on next page.]
Second Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
[Signatures
continued from previous page.]
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COBANK,
ACB
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By:
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/s/ Gloria S.
Hancock
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Gloria
S. Hancock
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Vice
President
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Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
Exhibit
A
SCHEDULE
6(N)
SUBSIDIARIES
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Issuer
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Holder
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Number
of Shares Owned by the Pledgor
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Percentage
of Total Outstanding Shares Owned by the Pledgor
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Shenandoah
Telephone Company
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Borrower
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5,000
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100%
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Shenandoah
Cable Television Company
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Borrower
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3,610
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100%
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ShenTel
Service Company
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Borrower
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4,800
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100%
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Shenandoah
Personal Communications Company
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Borrower
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18
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100%
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Shenandoah
Wireless Company (f/k/a Shenandoah Valley Leasing Company)
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Borrower
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1,500
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100%
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Shenandoah
Mobile Company
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Borrower
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5,000
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100%
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Shenandoah
Long Distance Company
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Borrower
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50
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100%
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ShenTel
Communications Company
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Borrower
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1
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100%
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Shenandoah
Network Company
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Borrower
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712
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100%
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Shentel
Converged Services of West Virginia, Inc.
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Borrower
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1
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100%
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Shentel
Converged Services, Inc.
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Borrower
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1
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100%
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Shentel
Management Company
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Borrower
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1
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100%
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Shentel
Cable Company
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Shenandoah
Cable Television Company
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1
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100%
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Second
Agreement Regarding Amendments to Loan Documents and Consent/
Shenandoah
Telecommunications Company
Exhibit
B
SCHEDULE
1
to
PLEDGE
AGREEMENT
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Entity
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Number
of Shares Owned by the Pledgor
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Certificate
Number(s)
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Percentage
of Total Outstanding Shares Owned by the Pledgor
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Shenandoah
Telephone Company
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5,000
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9293
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100%
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Shenandoah
Cable Television Company
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3,610
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6-17
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100%
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ShenTel
Service Company
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4,800
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3-13
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100%
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Shenandoah
Personal Communications Company
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18
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1-11
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100%
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Shenandoah
Wireless Company (f/k/a Shenandoah Valley Leasing Company)
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1,500
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3
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100%
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Shenandoah
Mobile Company
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5,000
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4-8,
4-A
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100%
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Shenandoah
Long Distance Company
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50
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1
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100%
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ShenTel
Communications Company
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1
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1
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100%
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Shenandoah
Network Company
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712
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1-8
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100%
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Shentel
Converged Services of West Virginia, Inc.
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1
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1
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100%
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Shentel
Converged Services, Inc.
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1
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1
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100%
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Shentel
Management Company
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1
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1
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100%
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