20220204Application.pdf

HAWLEY ATTORNEYS AND COUNSEI.,ORS
TROXEL - it.-; *.1 [';'; iJ: L;]Hawley Troxell Ennis & Hawley LLP
877 lrv,fain Street, Suite 1000
P.O. Box 1517
Boise, Idaho 837 01,-1 617
208.U4.6000
www. hawleytroxell. com
STEVEFRTNSKo
ApMtrrsp to PRACTICE LAw IN IDAHo
Euau": [e-mail]
DrREqr DrAr..: 208.W.47 6
DrREsr FAx: [phone]
February 4,2022
VIA E.MAIL uJS&r- za-o I
ATTENTION COMMISSION SECRETARY AND HEAD LEGAL SECRETARY:
Ms. Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd.
Building 8, Suite 201-A
Boise,ID 83714
Re: Westel, LLC ("Applicant") - Applicationfor Authority to Guaranty Loan
Dear Ms. Noriyuki:
Enclosed you will find Westel, LLC's Application for Authority to Guaranty a Loan to
Involta, LLC in an Aggregate Amount not to exceed $500,000,000, Case No. WSC-T-22-01.
Enclosed with this letter are copies of the Application, the Applicant's Manager's Resolution,
attached as Exhibit B, the Proposed Order, attached as Exhibit C, and a Notice of this
Application, attached as Exhibit D. The loan documents referenced in the Application and
deemed to be Exhibit A to the Application are being sent under a separate cover letter as
Westel's confidential information for Commission and Commission Staff review in connection
with the Application.
In addition, in order to enable it to meet Lender-imposed deadlines, Applicant
respectfully requests that the Commission issue its Order approving the foregoing Application on
or before February 18,2022.
Thank you very much for your prompt attention to this matter.
Sincerely,
HAWLEY LLP
Enclosures
HA
Frinsko
46220.0006.144873 83 . I
Stephen M. Frinsko, ISB No. 8432
HAWLEY TROXELL ENNIS & HAWLEY LLP
877 Main Street, Suite 1000
P.O. Box 1617
Boise,ID 83701-1617
Telephone: [phone]
Facsimile: 208-954-5261
Email: [e-mail]
Attorneys for Westel, LLC
TN THE MATTER OF THE APPLICATION
OF WESTEL,LLC FOR AUTHORITY TO
GUARANTY A LOAN TO TNVOLTA, LLC
IN AN AGGREGATE AMOUNT NOT TO
EXCEED $500,000,000.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
Case No. WSC-T-22-01
APPLICATION OF WESTEL, LLC
Westel, LLC ("Applicant") makes this Application under Idaho Code $ 6l-901 and
IDAPA $$ 3l.0l.0l.l4l-147 for authority to increase its obligations as a Subsidiary Guarantor
by executing joinders to (i) that certain Second Amendment to Credit Agreement dated as of
January 31,2022; (ii) that certain Security Agreement, dated as of April 14,2020, as amended by
that certain Second Amendment to Security Agreement dated as of January 31, 2022; and
(iii) other related loan documents (items (iHiii) are collectively the "Loan Documents"), in each
case in favor of Toronto Dominion (Texas) LLC and the other Lenders party thereto (collectively,
"Lender"), under which Applicant guarantees payment of, and pledged its collateral as security
for (collectively, the "Guaranty"), certain term loans, revolving loans, and letters of credit
(collectively, the "Loan") to be increased, made, or issued to Applicant's indirect parent, Involta,
LLC ("Involta"). The Loan, as amended, will initially consist of three separate credit facilities:
(i)one or more Term Loans in a principal amount equal to $125,000,000 (as of the date of this
ApplrcaroN oF WESTEL,LLC (2022 LoeN GuaneNrv) - I
46220.0[,06.14462565.4
Application); (ii) one or more Delayed Draw Term Loans in an aggregate principal amount of up
to $50,000,000 (as of the date of this Application); and (iii) one or more Revolving Loans in an
aggregate principal amount of up to $20,000,000 (as of the date of this Application). In addition,
the Loan Documents provide that the credit facilities may be increased and additional facilities
added by the borrowers if certain leverage ratios and other loan conditions are met. As of the
date of this Application, Applicant expects the total Loan amount could be increased to
$500,000,000 over time. In support of its Application, Applicant states as follows:
L Applicant is a certificated telephone corporation organized under the laws of the
State of Idaho providing telecommunication services including local exchange service within the
state of Idaho under a Second Amended Certificate of Public Convenience and Necessity,
Certificate No. 401 (the "Certificate"). Applicant acquired the Certificate through a 2014
acquisition, as described in more detail below. In July 2002, the Commission issued Order No.
29084 granting WestCom LLC dba Digital Easy Chair a Certificate of Public Convenience and
Necessity, and in August 2002 the Commission issued Certificate No. 401 to WestCom. In
January 2006, the Commission issued Order No. 29965 granting a name change from WestCom
LLC dba Digital Easy Chair to WestCom, LLC dba WestTelFiber ("WestCom"). Effective July
15, 2014, Applicant acquired the assets of WestCom, which included the Certificate. The
Commission approved of that transfer and the resulting name change to Westel, LLC by Order
No. 33121 in Case No. WSC-T-05-1.
2. All notices and communications with regard to this Application should be served
upon:
Appr-rcnrroN oF WESTEL,LLC (2022 LoeN GuenaNrv) - 2
4A20.0f,06.1446256s.4
Steve Frinsko
HAWLEY TROXELL ENNIS & HAWLEY LLP
877 Main Street, Suite 1000 (zlP 83702)
P.O. Box l617
Boise, ldaho 83701-1617
sfri nsko @haw I eltroxe I l.com
Telephone: [phone]
Facsimile : 208-9 5 4-5261
and
Randall Rings
Chief Administrative Officer and Corporate Secretary
lnvolta, LLC
460lzth Avenue SE
Suite 100
Cedar Rapids, Iowa 52401
[e-mail]
Telephone: 3 I 9-26 I -3000
3. The Guaranty is a condition of the Loan. The Loan proceeds will be used to pay
for, and partially reimburse general funds to: (a) refinance in full the Existing Term Loans,
(ii) refinance in full the Existing Delayed Draw Term Loan Commitments, (iii) refinance in full
the Existing Revolving Commitments with new Revolving Commitments in part to repay
existing indebtedness for borrowed money of Involta and its subsidiaries and affiliates; (b) in
part for working capital and general corporate purposes, including to effect certain acquisitions,
direct and indirect investments in other parties, capital expenditures, redemption of certain equity
interests in Involta's parent entity, and any other transaction not prohibited under the Loan
agreement. The Loan documents do not allow for any proceeds of revolving loans to be used to
finance a dividend. The material terms of the Loan and more details regarding permitted uses of
Loan proceeds are set forth in the Credit Agreement and Security Agreement, in each case, as
amended to date. Copies of the Credit Agreement and the Security Agreement, which are to be
Appr-rceroN oF WESTEL, LLC (2022 LoaN GueneNrv) - 3
46220.0006.1M62s65.4
deemed Exhibit A to this Application, are being submitted with this Application under separate
cover as Westel's confidential information for Commission and Commission Staffreview.
4. Applicant is required to provide a guaranty of the Loan and to pledge its collateral
as security for the Loan. Applicant's affiliates and parent companies, including Involta (as both a
borrower and as a guarantor), Involta Holdings, LLC, Involta Real Estate, LLC, Eastem Iowa
Data Center, LLC, InvoltaOne, LLC, and Broadrband.com, LLC, are also required to guaranty
the Loan and pledge their respective collateral as security for the Loan.
5. The proposed transaction is consistent with the public interest. The Loan will be
used to refinance existing credit lines and will fund Applicant's operations and capital
expenditures, which will ultimately improve service for Applicant's customers and make it
possible for Applicant to meet new service demands.
6. A copy of the Applicant's most recent Annual Report showing the authorized and
outstanding classes of Applicant's securities is on file with the Commission, and the Applicant
respectfully requests the Commission take official notice thereof.
7. A certified copy of Applicant's Manager's resolution authorizing the proposed
transaction is attached hereto as Exhibit B.
8. A Proposed Order granting this Application is attached hereto as Exhibit C.
9. Notice of this Application will be published within seven days in The ldaho
Statesman (Boise) and the ldaho Business Review (Boise). A copy of this Notice is attached as
Exhibit D.
10. Applicant submits that the public interest does not require a hearing on this matter
and it requests that the Commission process this Application and determine this matter by
Modified Procedure, pursuant to Rule 144 of the Commission's Rule of Practice and Procedure.
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46220.0006. | 4462s6s.4
In the event the Commission determines that formal proceedings on this Application are
necessary, Applicant stands ready for immediate hearing.
11. One hundred percent (100%) of Applicant's total book value is located in Idaho.
Applicant has therefore attashed its filing fee, calculated pursuant to Idatro Code Section 6l-905,
in the amount of $1000.
12. In order to enable it to meet Lender-imposed deadlines, Applicant requests that
the Commission issue its Order approving the foregoing Application on or before February 18,
2022.
WHEREFORE, Applicant respectfully requests an Order of this Commission:
l. Granting the foregoing Application of Westel, LLC for Authority to Guaranty A
Loan to Involtq LLC in an Amount of up to $500,000,000; and
2. Granting such other relief as the Commission deems just and reasonable in this
matter.
Dated: February 4,2022 & HAWLEY LLP
By:
Frinsko, ISB No. 8432
Attorneys for Westel, LLC
AppncertoN oF WEsrEL, LLC Q022 Loml Guanelrry) - 5
46220.0006.14/,6,.565.4
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 4th day of February,2022,I caused to be served a true
and correct copy of the foregoing document by the method indicated below, and addressed to ttre
following:
Iv[s. Jan Noriyuki, Secretary
Idaho Public Utilities Commission
P.O. Box 83720 Boise,ID 83720-0074
ll33l W. Chinden Blvd.
Building 8, Suite 201-A
Boise,ID 83714
e-mail : [e-mail]
[ ] U.S. Mail
[ ] Hand Delivered
[ ] Overnight Mail
[ ] Facsimile
[X] E-mail pursuant to IPUC Order No. 34602
M. Frinsko
Appr,rcerrou oF WESTEL,LLC (2022LoeN Gunnavrv) - 6
46220.N06.1446256s.4
EXHIBIT A
LOAN DOCUMENTS
lsubmitted under separate cover as Applicant's confidential informattonl
AppLtceuoN oF WESTEL, LLC (2022 LoaN GueneNry) - Ercrnn A
46220.0006.1446,s65.4
EXHIBIT B
APPLICANT' S MANAGER'S RESOLUTION
AppLrcenoN or WBSTBL,LLC (2022 LoaN Guen tNry) - Exrmn B
4A20.000,6.14462565.4
WESTEL, LLC
JOINT WRITTEN CONSENT OF
SOLE MEMBER AND SOLE MANAGER
February 1,2022
The undersigned as the sole member and sole manager (collectively, the "Manager") of
Westel, LLC, an Idaho limited liability company ("Company"), waives any requirements of
notice and a meeting, pursuant to Idaho Code Section 30-25-101, et. seq., and consents to the
adoption of the following resolutions, effective as of the date set forth above.
As used in this Consent, "Authorized Representatives" means Bruce Lehrman, Jim
Buie, and Randall Rings, and any other employee of a Company acting at the written direction of
such individual. Capitalized terms used but not defined in this Consent have the meanings given
to them in the Credit Agreement referenced below.
The Manager deems it advisable and in the best interests of the Company to take the
actions and to consummate the transactions described below.
Second Amendment to Credit Agreement
RESOLVED: That it is advisable and in the best interest of the Company, and that the
Company is authorized to negotiate, enter into, execute, and deliver, and hereby is authorized to
perform the Second Amendment to Credit Agreement (the "Second Amendment") among
Involta, LLC, an Iowa limited liability company and sole member of the Company ('olnvolta"),
Toronto Dominion (Texas) LLC, as administrative agent for the Lenders and collateral agent for
the Secured Parties (in such capacities, the "Agent"), The Toronto-Dominion Bank, New York
Branch, as a Swing Line Lender and as Issuing Bank, and the other parties thereto, pursuant to
which Involta will borrow the Loans and the Company will become a pledgor and grantor of
Collateral obligated in respect of the Obligations thereunder and the Company will become a
Guarantor; and that the Second Amendment be, and hereby is, ratified, approved and adopted;
and that the Authorized Representatives are, and each of them acting singly is, authorized in the
name and on behalf of the Company to execute and deliver the Second Amendment, with such
changes as the Authorized Representative or Authorized Representatives executing the same
may, in such Authorized Representative's or Authorized Representatives' discretion, deem
appropriate, the execution and delivery thereof to be conclusive evidence of such determination
and of the due authorization of the Company.
Second Amendment Ancillaru Documents
RESOLYED: That it is advisable and in the best interest of the Company, and that the
Company is authorized to negotiate, enter into, execute and deliver, and hereby is authorized to
perform the Loan Documents to which the Company is a party, including, without limitation, the
Security Agreement (as amended by the Second Amendment), Notes, the Security Documents,
the Fee Letter and any other documents, agreements and certificates contemplated by the Loan
Documents to which the Company is a pafty, all as described in the Second Amendment (the
"Second Amendment Ancillary Documents", and together with the Second Amendment, the
"Second Amendment Documents"); and that each Second Amendment Ancillary Document be,
JorNr WrurrsN CoussNr FoR SECoND ANapr.rDrvreNr- I
46220.0006.t 4486903. l
and hereby is, ratified, approved and adopted; and that the Authorized Representatives are, and
each of them acting singly is, authorized in the name and on behalf of the Company to execute
and deliver the Second Amendment Ancillary Documents to which the Company is a party in
such forms as such Authorized Representative executing the same may, in such Authorized
Representative's discretion, deem appropriate, the execution and delivery thereof to be
conclusive evidence of such determination and of the due authorization of the Company.
FURTHER RESOLYED: That the Authorized Representatives are, and each of them
acting singly is, authorized in the name and on behalf of the Company to execute and deliver any
amendments, supplements or other modifications to the Second Amendment Documents to
which the Company is a party and any agreements, instruments, or other documents in
connection with the transactions contemplated by the Second Amendment Documents on such
terms and conditions as the Authorized Representatives may deem appropriate, the execution and
delivery thereof to be conclusive evidence of such determination and of the due authorization of
the Company.
FURTHER RESOLVED: That the Company is authorized to unconditionally guarantee
the Loans and grant a security interest and lien to the Lenders in any and all of the Company's
assets pursuant to the Second Amendment Documents, which security interest and lien shall
secure all of the Company's obligations to the Lenders under the Second Amendment
Documents.
FURTIIER RESOLVED: That the Company is authorized and directed to execute,
deliver and/or file (or authorize the filing of) financing statements and any other documents
necessary under the Uniform Commercial Code or under any other applicable statutes in order to
perfect, complete, or record the liens and security interests granted under or pursuant to the
Second Amendment Documents.
IPUC Aporoval
RESOLVED: That the Company is authorized, and directed to apply to the Idaho Public
Utilities Commission ("IPUC") under tdaho Code $ 6l-901 and IDAPA $$ 31.01 .0l.l4l-147
for authority to execute the Second Amendment Documents.
FURTHER RESOLVED: That the authorizations granted under this Consent are in all
respects conditioned upon IPUC issuing an order authorizing the Company to execute the
Second Amendment Documents.
General Authoritv
RESOLVED: That the Authorized Representatives are, and each of them acting singly
is, authorized from time to time, in the name of and on behalf of the Company, if necessary, to
execute, make oath to, acknowledge and deliver any and all such orders, directions, certificates,
agreements, and documents, and to do or cause to be done any and all such other acts and things,
as may, in his, her, or their judgment, be necessary, desirable, appropriate, or convenient in
connection with the consummation of the transactions contemplated by the foregoing resolutions.
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46220.0006.1 4486903. I
FIIRTIrBR RESOLVED: That any acts on behalf of the Company in furtherance of the
foregoing resolutions and any orders, directions, certificates, agreemeots, and documents
previously executed on behalf of the Company by the Authorized Representatives in firtherance
of the foregoing resolutions bc, and they hereby are, authorized, ratifie{ confirmed, and
approved in all respects as the true acts and deeds of the Company with the same force and effec
as if each such act, transaction, ordo, direction, certificate, agx€ement, or document had beon
specifically authorized in advance by resolution of the Company.
The undersigned furttrer dirocts that this Consent will take effect immediately as of the
date first above written and shall be filed in the minute books of the Company.
SOLE MEMBER AND SOLE MANAGER
INVOLTA, LLC
By
Ihesident
Jonw WRrrreN CoNssNT roR Secouo Ar"rsNDMEr.IT - 3
462:tO.W.t4485903.1
EXHIBIT C
PROPOSED ORDER
AppucanoN or WSSTEL,LLC (2022 LoeN Gueneurv) - ExmoIr C
46220.0006.1M62565.4
Stephen M. Frinsko, ISB No. 8432
HAWLEY TROXELL ENNIS & HAWLEY LLP
877 Main Street, Suite 1000
P.O. Box 1617
Boise,ID 83701-1617
Telephone: [phone]
Facsimile: 208-954-5261
Emai I : [e-mail]
Attorneys for lV'estel, LLC
IN THE MATTER OF THE APPLTCATION
OF WESTELLLC FOR AUTHORITY TO
GUARANTY A LOAN TO TNVOLTA, LLC
IN AN AGGREGATE AMOUNT NOT TO
EXCEED $500,000,000.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
Case No. WSC-T-22-01
PROPOSED ORDER
On February 4,2022, Westel, LLC ("Applicant"), filed an Application for authority to
execute joinders to a Second Amendment to Credit Agreement, Security Agreement (as amended
by the Second Amendment), and related loan documents in favor of Toronto Dominion (Texas)
LLC and the other Lenders party thereto (collectively, "Lender"), under which Applicant will
guaranty payment of, and will pledge its collateral as security for (collectively, the "Guaranty"),
certain term loans, revolving loans, and letters of credit (collectively, the "Loan") to be made or
issued to Applicant's indirect parent, Involta, LLC ("Involta"), in an aggregate amount not to
exceed $500,000,000.
In support of that Application, Applicant states that the proceeds of the Loan will be used
to pay for, and partially reimburse general funds to: (a) in part, repay existing indebtedness for
borrowed money of Involta and its subsidiaries and affiliates; (b) in part, fund working capital
and general corporate purposes (including to effect certain acquisitions, direct and indirect
ApprtcarroN oF WESTEL,LLC (2022 LoaN GueRc,Nry) - Exumrr C
46220.0006.1M62s6s.4
investments in other parties, capital expenditures, and any other transaction not prohibited under
the Loan agreement.
After examining the Application and supporting documents and being fully advised in the
premises, the Commission hereby finds that a hearing in this matter is not required, and that the
proposed transaction is consistent with the public interest and the Applicant's proper
performance of its duties as a public utility.
IT IS TIIEREFORE ORDERED that the Application of Westel, LLC for authority to
execute a Second Amendment to Credit Agreement, Security Agreement (as amended by the
Second Amendment), and related loan documents in favor of Toronto Dominion (Texas) LLC
and the other Lenders party thereto, in an amount not to exceed $500,000,000 be, and the same is
hereby granted.
DONE by Order of the tdaho Public Utilities Commission this day of
2022
Eric Anderson, President
John Chatburn, Commissioner
John Hammond, Commissioner
ATTEST:
Jan Noriyuki
Commission Secretary
AppucauoN oF WESTEL,LLC (2022 LoaN GuenaNrv) - Exrntr C
46220.00,06.t4462s6s.4
EXHIBIT D
NOTICE OF THIS APPLICATION
ApplrcanoN or WpsrsI-, LLC (2022 LoaN GueRaNrv) - ExHnrr D
46220.0006 1M62565.4
LEGAL NOTICE OF WESTEL, LLC'S
APPLICATION FOR AUTHORITY TO GUARANTY LOAN
cAsE NO. WSC-T-22-01
NOTICE IS HEREBY GIVEN that on February 4,2022, Westel, LLC completed and
filed with the ldaho Public Utilities Commission an Application for authority Application for
authority to execute a Credit Agreement, Security Agreement, and related loan documents in
favor of Toronto Dominion (Texas) LLC and the other Lenders party thereto in connection with
certain loans to be made to Applicant's indirect parent company, Involta, LLC.
The Application is on file and is available for public inspection at the Idaho Public
Utilities Commission. Any person desiring to comment on said Application must file petitions or
protests with the Idaho Public Utilities Commission within fourteen (14) days of the filing date.
If no protests are received within this time limit, the Commission may consider the Application
and enter its Order without setting the matter for hearing. If written protests are filed with the
Commission within the time limit set, the Commission will consider the same, and in its
discretion, may set a hearing. Petitions or protests must be filed with: Jan Noriyuki, Secretary,
Idaho Public Utilities Commission, ll33l W. Chinden Boulevard, Building 8, Suite 201-A,
Boise,Idaho 83714.
Jan Noriyuki, Secretary
Idaho Public Utilities Commission
AppLrcerroN oF WESTEL ,LLC (2022 LoeN GuanaNrv) - Exumlr D
46220.0006.t4462565.4