CONFORMED COPY
AMENDMENT (this "Amendment"), dated as of October 30, 1998,
to the FIVE YEAR COMPETITIVE ADVANCE AND REVOLVING CREDIT AGREEMENT dated as of
October 2, 1996 (as the same may be amended, supplemented or otherwise modified
from time to time, the "Credit Agreement"), by and among CENDANT CORPORATION, a
Delaware corporation (the "Borrower"), the financial institutions parties
thereto (the "Lenders"), and THE CHASE MANHATTAN BANK, a New York banking
corporation, as agent for the Lenders (in such capacity, the "Administrative
Agent").
W I T N E S S E T H:
WHEREAS, the Borrower has requested that certain provisions
of the Credit Agreement be amended and waived as set forth herein, and;
WHEREAS, the Lenders are willing to agree to such amendments
and waivers on the terms set forth herein;
NOW THEREFORE, in consideration of the premises and mutual
covenants contained herein, the undersigned hereby agree as follows:
1. Defined Terms. Terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit Agreement.
2. Amendments to Section 1.
(a) Section 1 of the Credit Agreement is amended by adding
the following definition in alphabetical order:
"October Amendment Date" shall mean the Effective Date as
defined in the Amendment to this Agreement dated as of October 30,
1998.
(b) Section 1 of the Credit Agreement is amended by deleting
the definition of "Avis" therefrom in its entirety.
(c) Section 1 of the Credit Agreement is amended by adding
the following to the definition of "Consolidated EBITDA" immediately after
clause (vii) thereof:
minus (viii) any cash expenditures during such period to the
extent such cash expenditures (x) did not reduce Consolidated
Net Income and (y) were applied against reserves that
constituted non-cash items which reduced Consolidated Net
Income during prior periods,
(d) Section 1 of the Credit Agreement is amended by adding at
the end of the first sentence of "Consolidated Interest Expense" the following:
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minus, without duplication, any interest income of the
Borrower and its Consolidated Subsidiaries on a consolidated
basis during such period.
(e) Section 1 of the Credit Agreement is amended by deleting
clause (ii) from the definition of "Consolidated Net Income" and substituting
therefor the phrase "(ii) [INTENTIONALLY OMITTED]".
(f) Section 1 of the Credit Agreement is amended by deleting
the phrases "Avis and its Subsidiaries and" and "Avis and" each time they
appear in the definition of the term "Consolidated Total Indebtedness".
(g) Section 1 of the Credit Agreement is amended by deleting
from the definition of "GAAP" the phrase "Merger Effective Date" and
substituting therefor the phrase "October Amendment Date".
(h) Section 1 of the Credit Agreement is amended by amending
and restating the definition of "Merger Effective Date" in its entirety to read
as follows:
"Merger Effective Date" shall mean December 18, 1997.
(i) Section 1 of the Credit Agreement is amended by deleting
the phrase "Avis and its Subsidiaries and" from the definition of "Subsidiary".
3. Amendment to Section 2.9. Section 2.9 of the Credit
Agreement is amended by adding at the end of paragraph (b) the phrase "plus the
applicable margin, if any, for ABR Loans from time to time in effect pursuant
to Section 2.22".
4. Amendment to Section 2.22. Section 2.22 of the Credit
Agreement is amended by deleting such Section and substituting therefor the
following:
SECTION 2.22 Certain Pricing Adjustments.
The Facility Fee and the applicable LIBOR Spread in effect
from time to time shall be determined in accordance with the following
table:
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S&P/▇▇▇▇▇'▇ Rating Equivalent
of the Borrower's Senior Facility Fee Applicable LIBOR Spread
Unsecured Long-Term Debt (In Basis Points) (In Basis Points)
------------------------ --------------- ---------------
A/A2 or better 10.0 27.5
A-/A3 12.5 37.5
BBB+/Baa1 15.0 47.5
BBB/Baa2 17.5 57.5
BBB-/Baa3 22.5 65.0
BB+/Ba1 or lower 37.5 112.5
In the event the S&P rating on the Borrower's senior
unsecured long-term debt is not equivalent to the ▇▇▇▇▇'▇ rating on
such debt, the lower rating will determine the Facility Fee and
applicable LIBOR Spread. In the event that the Borrower's senior
unsecured long-term debt is rated by only one of S&P and ▇▇▇▇▇'▇, then
that single rating shall be determinative. In the event that the
Borrower's senior unsecured long-term debt is not rated by either S&P
or ▇▇▇▇▇'▇, then the Facility Fee and the applicable LIBOR Spread
shall be deemed to be calculated as if the lowest rating category set
forth above applied. Any increase in the Facility Fee or the
applicable LIBOR Spread determined in accordance with the foregoing
table shall become effective on the date of announcement or
publication by the Borrower or either such rating agency of a
reduction in such rating or, in the absence of such announcement or
publication, on the effective date of such decreased rating, or on the
date of any request by the Borrower to either of such rating agencies
not to rate its senior unsecured long-term debt or on the date either
of such rating agencies announces it shall no longer rate the
Borrower's senior unsecured long-term debt. Any decrease in the
Facility Fee or applicable LIBOR Spread shall be effective on the date
of announcement or publication by either of such rating agencies of an
increase in rating or in the absence of announcement or publication on
the effective date of such increase in rating. The applicable margin
for ABR Loans shall be 1% less than the applicable LIBOR Spread (but
not less than 0%).
5. Amendment to Section 2.24. Section 2.24 of the Credit
Agreement is amended by adding the following at the end thereof:
(l) Notwithstanding the other provisions of this Agreement,
the Borrower may request that the Issuing Lender issue the RAC Letter
of Credit on or prior to April 15, 1999 as long as, after giving
effect thereto, the sum of the then current L/C Exposure plus the
aggregate Loans then outstanding does not exceed the Total Commitment.
The RAC Letter of Credit shall be a Letter of Credit issued under this
Agreement provided that:
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(i) The RAC Letter of Credit may be denominated in
United Kingdom Pounds Sterling as long as at the time of
issuance the Dollar Equivalent of the face amount of the RAC
Letter of Credit does not exceed $750,000,000.
(ii) The RAC Letter of Credit shall be deemed not to
be a utilization of the $100,000,000 available sublimit for
the issuance of the Letters of Credit under Section 2.24(a).
(iii) The Borrower's reimbursement obligations and
other payment obligations with respect to the RAC Letter of
Credit (including reimbursement obligations under paragraphs
(e) and (f) of this Section 2.24) shall be denominated in
Dollars and shall be calculated on the basis of the Dollar
Equivalent of the amount of any drawing under the RAC Letter
of Credit or the face amount of the RAC Letter of Credit or
any other amount with respect to the RAC Letter of Credit
denominated in United Kingdom Pounds Sterling. Each Lender's
funding and reimbursement obligations in respect of any
drawing shall be in Dollars and shall be based on the Dollar
Equivalent of the amount of such drawing calculated on the
date of the such drawing.
(iv) The L/C Exposure with respect to the RAC Letter
of Credit shall be equal to the Dollar Equivalent of the face
amount thereof and the Dollar Equivalent of all drafts
thereunder which have been presented and not yet paid or paid
but not reimbursed.
(v) The Borrower, in coordination with the
Administrative Agent, will implement and maintain internal
controls with the object of preventing the aggregate amount
of the Loans, Letters of Credit (other than the RAC Letter of
Credit) and the Dollar Equivalent of the RAC Letter of Credit
("Total Exposure") from exceeding the Total Commitment. If,
at any time, the Total Exposure exceeds the Total Commitment,
then the Borrower shall immediately repay Loans, repay
reimbursement obligations in respect of Letters of Credit
and/or cause Letters of Credit to be cancelled or the amount
thereof to be reduced, as shall be necessary to cause the
Total Exposure to no longer exceed the Total Commitment.
(vi) Each Lender confirms that, in accordance with
Sections 2.24(a)(ii) and (d), it will purchase a
participating interest in the RAC Letter of Credit upon the
issuance thereof.
(vii) As used in this Section 2.24 the following
terms have the following meaning:
"Dollar Equivalent" shall mean with respect
to any amount in respect of the RAC Letter of Credit
denominated in United Kingdom Pounds Sterling, at
any date of determination thereof, an amount in
Dollars equivalent to such amount calculated on the
basis of the Spot Rate of Exchange.
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"RAC Letter of Credit" shall mean a letter
of credit to be issued for the account of the
Borrower by The Chase Manhattan Bank, London Branch
to support the Borrower's payment obligations in
respect of the RAC Loan Notes.
"Spot Rate of Exchange" shall mean, with
respect to United Kingdom Pounds Sterling, at any
date of determination thereof, the spot rate of
exchange in New York that appears on the display
page applicable to United Kingdom Pounds Sterling on
the Dow ▇▇▇▇▇ System Incorporated Service (or such
other page as may replace such page on such service
for the purpose of displaying the spot rate of
exchange in New York); provided that if there shall
at any time no longer exist such a page on such
service, the spot rate of exchange shall be
determined by reference to another similar rate
publishing service selected by the Administrative
Agent and, if no such similar rate publishing
service is available, by reference to the published
rate of the Administrative Agent in effect at such
date for similar commercial transactions. Any
determination by the Administrative Agent of the
Spot Rate of Exchange shall be conclusive.
Notwithstanding the foregoing, for purposes of
calculating the fronting fee described in Section
2.24(f)(i)(c) and the commission described in
Section 2.24(f)(ii) for any period, the Spot Rate
shall be deemed to be the Spot Rate reasonably
determined from time to time by the Administrative
Agent and may be fixed from time to time by the
Administrative Agent to facilitate calculation of
such amounts.
6. Amendment to Section 3.4. Section 3.4 of the Credit
Agreement is amended by deleting such Section and substituting therefor the
following:
SECTION 3.4 Financial Statements of Borrower.
The (a) revised audited consolidated financial
statements of the Borrower and its Consolidated Subsidiaries as of
December 31, 1996 and December 31, 1997, and (b) unaudited
consolidated balance sheets of the Borrower and its Consolidated
Subsidiaries as of March 31, 1998 and June 30, 1998, together with the
related unaudited statements of income, shareholders' equity and cash
flows for such periods, fairly present the financial condition of the
Borrower and its Consolidated Subsidiaries as at the dates indicated
and the results of operations and cash flows for the periods indicated
in conformity with GAAP subject to normal year-end adjustments in the
case of the March 31, 1998 and June 30, 1998 financial statements.
7. Amendment to Section 3.5. Section 3.5 of the Credit
Agreement is amended by deleting such Section and substituting therefor the
following:
There has been no material adverse change in the business, assets,
operations, or condition, financial or otherwise, of the Borrower and
its Subsidiaries taken as a
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whole from that disclosed in the revised audited consolidated financial
statements (including the footnotes thereto) of the Borrower referred to in
Section 3.4 for its 1997 fiscal year; provided, however, that the foregoing
representation is made solely as of the October Amendment Date.
8. Amendment to Section 3.6. Section 3.6 of the Credit
Agreement is amended by deleting the phrase "Merger Effective Date" and
substituting therefor the phrase "October Amendment Date".
9. Amendment to Section 3.8. Section 3.8 of the Credit
Agreement is amended by deleting the phrase "Merger Effective Date" and
substituting therefor the phrase "October Amendment Date".
10. Amendment to Section 3.10. Section 3.10 of the Credit
Agreement is amended by deleting the phrase "G,".
11. Amendment to Section 3.14. Section 3.14 of the Credit
Agreement is amended by deleting the phrase "Merger Effective Date" and
substituting therefor the phrase "October Amendment Date".
12. Amendment to Section 3.15. Section 3.15 of the Credit
Agreement is amended by (a) deleting each reference to the phrase "Merger
Effective Date" and substituting therefor the phrase "October Amendment Date"
and (b) deleting the phrase "September 1996" and substituting therefor the
phrase "October 1998".
13. Amendment to Section 6.1. Section 6.1 of the Credit
Agreement is amended by deleting from paragraph (a) the phrase "date hereof"
each time it appears and substituting therefor the phrase "October Amendment
Date".
14. Amendment to Section 9. Section 9 of the Credit Agreement
is amended by adding the following at the end thereof:
SECTION 9.15. Judgment.
(a) If for the purpose of obtaining judgment in any court it
is necessary to convert a sum due hereunder in one currency into
another currency, the parties hereto agree, to the fullest extent that
they may effectively do so, that the rate of exchange used shall be
that at which in accordance with normal banking procedures the
Administrative Agent could purchase the first currency with such other
currency on the Business Day preceding the day on which final judgment
is given.
(b) The obligations of the Borrower in respect of this
Agreement and any Note due to any party hereto or any holder of any
bond shall, notwithstanding any judgment in a currency (the "judgment
currency") other than the currency in which the sum originally due to
such party or such holder is denominated (the "original currency"), be
discharged only to the extent that on the Business Day following
receipt by such party or such holder (as the case may be) of any sum
adjudged to be
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so due in the judgment currency such party or such holder (as the case
may be) may in accordance with normal banking procedures purchase the
original currency with the judgment currency; if the amount of the
original currency so purchased is less than the sum originally due to
such party or such holder (as the case may be) in the original
currency, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such party or such
holder (as the case may be) against such loss, and if the amount of
the original currency so purchased exceeds the sum originally due to
any party to this Agreement or any holder of Notes (as the case may
be), such party or such holder (as the case may be), agrees to remit
to such Borrower, such excess. This covenant shall survive the
termination of this Agreement and payment of the Loans and all other
amounts payable hereunder.
15. Amendments to Schedules 3.6, 6.1 and 6.5. Schedules 3.6,
6.1 and 6.5 of the Credit Agreement are hereby amended by replacing such
Schedules with new Schedules 3.6, 6.1 and 6.5 in the forms of Schedules 3.6,
6.1 and 6.5, respectively, attached to this Amendment.
16. Effective Date. This Amendment shall become effective on
the date (the "Effective Date") on which:
(a) the Borrower, the Administrative Agent and the Required
Lenders under each Credit Agreement shall have duly executed and delivered to
the Administrative Agent this Amendment; and
(b) the Lenders shall have received the (i) revised audited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries as of December 31, 1997 and December 31, 1996, as adjusted for the
accounting irregularities disclosed in the Borrower's amended 1997 Form 10K/A
filed with the Securities and Exchange Commission and (ii) unaudited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries as of March 31, 1998 and June 30, 1998.
17. Representations and Warranties. The Borrower hereby
represents and warrants that (a) each of the representations and warranties in
Section 3 of each Credit Agreement shall be, after giving effect to this
Amendment, true and correct in all material respects as if made on and as of
the Effective Date (unless such representations and warranties are stated to
relate to a specific earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such
earlier date) and (b) after giving effect to this Amendment, no Default or
Event of Default shall have occurred and be continuing.
18. No Other Amendments; Confirmation. Except as expressly
amended hereby, the provisions of the Credit Agreement and each of the
Fundamental Documents are and shall remain in full force and effect.
19. Governing Law. This Amendment and the rights and
obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York.
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20. Counterparts. This Amendment may be executed by one or
more of the parties hereto on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. This Amendment may be delivered by facsimile transmission of the
relevant signature pages hereof.
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IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
executed and delivered by their duly authorized officers as of the date first
above written.
CENDANT CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Chief Financial Officer
THE CHASE MANHATTAN BANK, as
Administrative Agent and as a Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
ABN-AMRO BANK N.V. NEW YORK
BRANCH
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
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BANK OF AMERICA NT&SA
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
BANK OF MONTREAL
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Director
THE BANK OF NEW YORK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
THE BANK OF NOVA SCOTIA
By: /s/ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
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PARIBAS
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
BAYERISCHE LANDESBANK
GIROZENTRALE
CAYMAN ISLANDS BRANCH
By:
----------------------------
Name:
Title:
BAYERISCHE HYPO-UND VEREINSBANK
AG, NEW YORK BRANCH
By:
----------------------------
Name:
Title:
By:
----------------------------
Name:
Title:
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CIBC INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Director
CITIBANK, N.A.
By:
----------------------------------
Name:
Title:
COMERICA BANK
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/▇▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: First Vice President-Manager
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CREDIT SUISSE FIRST BOSTON
By: /s/ ▇▇▇▇ ▇'▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇'▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Associate
DG BANK DEUTSCHE
GENOSSENSCHAFTSBANK, CAYMAN
ISLAND BRANCH
By:
-------------------------
Name:
Title:
By:
-------------------------
Name:
Title:
FIRST AMERICAN NATIONAL BANK
By:
-------------------------
Name:
Title:
FIRST HAWAIIAN BANK
By:
-------------------------
Name:
Title:
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THE FIRST NATIONAL BANK OF BOSTON
By:
-------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO
By:
-------------------------------
Name:
Title:
FIRST NATIONAL BANK OF MARYLAND
By:
-------------------------------
Name:
Title:
FIRST UNION NATIONAL BANK
By:
-------------------------------
Name:
Title:
FLEET NATIONAL BANK
By:
-------------------------------
Name:
Title:
THE FUJI BANK, LIMITED
NEW YORK BRANCH
By:
-------------------------------
Name:
Title:
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THE INDUSTRIAL BANK OF JAPAN,
LIMITED
NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇▇▇ Gioardano
Title: Vice President
MELLON BANK, N.A.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Title: First Vice President
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF
NEW YORK
By:
-------------------------------
Name:
Title:
THE NORTHERN TRUST COMPANY
By:
-------------------------------
Name:
Title:
PNC BANK, N.A.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
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ROYAL BANK OF CANADA
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Manager
THE SAKURA BANK, LIMITED
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
THE SANWA BANK, LIMITED
By:
-------------------------------
Name:
Title:
THE SUMITOMO BANK, LIMITED,
NEW YORK BRANCH
By: /s/ J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
Name: J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Senior Vice President
SUMMIT BANK
By:
-------------------------------
Name:
Title:
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THE TOKAI BANK LIMITED NEW YORK
BRANCH
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant General Manager
UNITED STATES NATIONAL BANK OF
OREGON
By:
-------------------------------
Name:
Title:
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
Title: Associate
BANKERS TRUST COMPANY
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
Schedule 6.1
Existing Indebtedness and Guarantees
Lease Agreement dated 11/29/91 between Days Inns of America, Inc. and ▇▇▇▇
▇▇▇▇▇▇▇ Life Insurance Company in the amount of $373,970.
Lease Agreement dated 8/1/93 between Coldwell Banker Corporation and Pitney
▇▇▇▇▇ in the amount of $22,805.
Lease Agreement dated 6/1/95 between Coldwell Banker Corporation and Xerox
Corporation in the amount of $652,331.
Unsecured borrowings by Coldwell Banker Corporation from ▇▇▇▇▇ Fargo Bank in
principal amount of $27,000,000.
Prior to March 31, 1999, $100 million Credit Facility dated March 27, 1998
between Hebdo Mag Inc., the lenders thereto and the Canadian Imperial Bank of
Commerce.
Schedule 6.5
Existing Liens
Liens in connection with leases of office equipment incurred in the
ordinary course of business.