Exhibit 10.3
================================================================================
AMENDED AND RESTATED CREDIT AGREEMENT
among
PRIMEDIA INC.
(f/k/a K-III Communications Corporation),
CANADIAN SAILINGS INC.,
VARIOUS LENDING INSTITUTIONS,
THE BANK OF NEW YORK
and
BANKERS TRUST COMPANY,
as Co-Syndication Agents,
THE BANK OF NOVA SCOTIA,
as Documentation Agent
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
----------------------------------------------
Dated as of May 24, 1996
and amended and restated as of March 11, 1999
----------------------------------------------
================================================================================
CHASE SECURITIES INC.,
as Lead Arranger and Book Manager
TABLE OF CONTENTS
Page
----
SECTION 1. Amount and Terms of Credit.........................................2
1.01 Commitments.....................................................2
1.02 Minimum Borrowing Amounts, etc..................................6
1.03 Notice of Borrowing.............................................6
1.04 Disbursement of Funds...........................................7
1.05 Register........................................................8
1.06 Conversions.....................................................8
1.07 Pro Rata Borrowings.............................................9
1.08 Interest........................................................9
1.09 Interest Periods...............................................10
1.10 Increased Costs, Illegality, etc...............................11
1.11 Compensation...................................................14
1.12 Changeof Lending Office........................................14
1.13 Tranche B Commitments..........................................15
SECTION 2. Letters of Credit.................................................15
2.01 Letters of Credit..............................................15
2.02 Minimum Stated Amount..........................................16
2.03 Letter of Credit Requests; Notices of Issuance.................16
2.04 Agreement to Repay Letter of Credit Drawings...................16
2.05 Letter of Credit Participations................................17
2.06 Increased Costs................................................19
SECTION 3. Fees; Commitments.................................................20
3.01 Fees...........................................................20
3.02 Voluntary Reduction of Commitments.............................20
3.03 Mandatory Reduction of Commitments, etc........................21
SECTION 4. Payments..........................................................23
4.01 Voluntary Prepayments..........................................23
4.02 Mandatory Repayments...........................................24
4.03 Method and Place of Payment....................................27
4.04 Net Payments...................................................27
SECTION 5. Conditions Precedent..............................................28
5.01 Conditions Precedent to the Restatement Effective Date.........28
5.02 Conditions Precedent to each Credit Event......................30
(a) No Default; Representations and Warranties.............30
(b) Notice of Borrowing; Letter of Credit Request..........31
SECTION 6. Representations, Warranties and Agreements........................31
6.01 Corporate Status...............................................31
6.02 Corporate Power and Authority..................................31
6.03 No Violation...................................................32
6.04 Litigation.....................................................32
6.05 Use of Proceeds; Margin Regulations............................32
6.06 Governmental Approvals.........................................33
6.07 Investment Company Act.........................................33
6.08 Public Utility Holding Company Act.............................33
6.09 True and Complete Disclosure...................................33
6.10 Financial Statements; Financial Condition......................34
6.11 Tax Returns and Payments.......................................34
6.12 Compliance with ERISA..........................................34
6.13 Subsidiaries...................................................35
6.14 Intellectual Property..........................................35
6.15 Compliance with Statutes, etc..................................36
SECTION 7. Affirmative Covenants.............................................36
7.01 Information Covenants..........................................36
7.02 Books, Records and Inspections.................................38
7.03 Payment of Taxes...............................................38
7.04 Corporate Franchises...........................................38
7.05 Compliance with Statutes, etc..................................39
7.06 ERISA..........................................................39
7.07 End of Fiscal Years; Fiscal Quarters...........................39
7.08 Use of Proceeds................................................39
7.09 Ownership of Subsidiaries......................................40
7.10 Maintenance of Corporate Separateness..........................40
7.11 Canadian Borrower Capital Structure............................40
SECTION 8. Negative Covenants................................................40
8.01 Changes in Business............................................40
8.02 Consolidation, Merger, Sale or Purchase of Assets, etc.........41
8.03 Liens..........................................................43
8.04 Indebtedness...................................................45
8.05 Advances, Investments and Loans................................47
8.06 Contingent Obligations.........................................48
8.07 Dividends, etc.................................................49
8.08 Transactions with Affiliates...................................51
8.09 Fixed Charge Coverage Ratio....................................52
8.10 Interest Coverage Ratio........................................52
8.11 Leverage Ratio.................................................52
8.13 Modifications of Certain Agreements, etc.......................53
8.14 Limitation on the Creation of Subsidiaries; Redesignation
of Partially-Owned Restricted Subsidiaries..................54
8.15 Limitation on Payments Under the Non-Compete Notes.............55
SECTION 9. Events of Default.................................................55
9.01 Payments.......................................................55
9.02 Representations, etc...........................................55
9.03 Covenants......................................................55
9.04 Default Under Other Agreements.................................55
9.05 Bankruptcy, etc................................................56
9.06 ERISA..........................................................56
9.07 Guaranty.......................................................57
9.08 Judgments......................................................57
9.09 Ownership......................................................57
SECTION 10. Definitions......................................................58
SECTION 11. The Administrative Agent.........................................90
11.02 Delegation of Duties..........................................90
11.03 Exculpatory Provisions........................................90
11.04 Reliance by Administrative Agent..............................91
11.05 Notice of Default.............................................91
11.06 Non-Reliance on Administrative Agent and Other Banks..........91
11.07 Indemnification...............................................92
11.08 Administrative Agent in Its Individual Capacity...............93
11.10 Resignation of the Administrative Agent; Successor Agent......93
SECTION 12. Miscellaneous....................................................93
12.01 Payment of Expenses, etc......................................93
12.02 Right of Setoff...............................................94
12.03 Notices.......................................................94
12.04 Benefit of Agreement..........................................95
12.05 No Waiver; Remedies Cumulative................................97
12.06 Payments Pro Rata.............................................97
12.08 Governing Law; Submission to Jurisdiction; Venue..............98
12.09 Counterparts..................................................99
12.10 Effectiveness.................................................99
12.11 Headings Descriptive..........................................99
12.12 Amendment or Waiver...........................................99
12.13 Survival.....................................................100
12.14 Domicile of Loans............................................100
12.15 Confidentiality..............................................100
ANNEX I List of Banks
ANNEX II Bank Addresses
ANNEX III Subsidiaries
ANNEX IV Liens
ANNEX V Existing Debt/Existing Contingent Obligations
ANNEX VI Existing Preferred Stock
EXHIBIT A -- Form of Notice of Borrowing
EXHIBIT B -- Form of Tranche B Assumption Agreement
EXHIBIT C-1 -- Form of Opinion of Simpson, Thacher & ▇▇▇▇▇▇▇▇
EXHIBIT C-2 -- Form of Opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
EXHIBIT C-3 -- Form of Opinion of White & Case LLP
EXHIBIT D -- Form of Officer's Certificate
EXHIBIT E-1 -- Form of Amended and Restated Subsidiary Guaranty
EXHIBIT E-2 -- Form of Amended and Restated Company Guaranty
EXHIBIT F -- Form of Amended and Restated Contribution Agreement
EXHIBIT G -- Form of Assignment and Assumption Agreement
EXHIBIT H -- Form of Subsidiary Assumption Agreement
CREDIT AGREEMENT, dated as of May 24, 1996 and amended and
restated as of March 11, 1999, among PRIMEDIA INC., a Delaware corporation
(f/k/a K-III Communications Corporation) (the "Company"), CANADIAN SAILINGS
INC., a Canada corporation (the "Canadian Borrower"), the lending institutions
listed from time to time on Annex I hereto (each a "Bank" and, collectively, the
"Banks"), THE BANK OF NOVA SCOTIA, as the Canadian Lender, THE BANK OF NEW YORK
and BANKERS TRUST COMPANY, as Co-Syndication Agents, THE BANK OF NOVA SCOTIA, as
Documentation Agent and THE CHASE MANHATTAN BANK, as Administrative Agent (the
"Administrative Agent"). Unless otherwise defined herein, all capitalized terms
used herein and defined in Section 10 are used herein as so defined.
W I T N E S S E T H:
WHEREAS, the Company, the Canadian Borrower, the Banks, the
Canadian Lender, the Co-Syndication Agents, the Documentation Agent and the
Administrative Agent are parties to a Credit Agreement, dated as of May 24, 1996
(as the same may have been amended, modified and supplemented to but excluding
the Restatement Effective Date, the "Original Credit Agreement"); and
WHEREAS, subject to and upon the terms and conditions herein
set forth, the parties hereto wish to amend and restate the Original Credit
Agreement in the form of this Agreement;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 Commitments. (a) Subject to and upon the terms and
conditions set forth herein, each Bank with a Term Loan Commitment severally
agrees to make, on the Initial Borrowing Date, a term loan or term loans (each a
"Term Loan" and, collectively, the "Term Loans") to the Company, which Term
Loans (i) shall be made pursuant to a single drawing, (ii) shall, at the option
of the Company, be Base Rate Loans or Eurodollar Loans, provided that all Term
Loans made as part of the same Borrowing shall, unless otherwise specifically
provided herein, consist of Term Loans of the same Type, (iii) shall equal for
each Bank, in initial aggregate principal amount, that amount which equals the
Term Loan Commitment of such Bank on the Initial Borrowing Date (before giving
effect to the termination thereof on such date pursuant to Section 3.03(d)).
Once repaid, Term Loans incurred hereunder may not be reborrowed.
(b) Subject to and upon the terms and conditions herein set
forth, each Bank with a Tranche A Revolving Loan Commitment severally agrees at
any time and from time to time on and after the Initial Borrowing Date and prior
to the Original Final Maturity Date, to make a revolving loan or revolving loans
(each a "Tranche A Revolving Loan" and, collectively, the "Tranche A Revolving
Loans") to the Company, which Tranche A Revolving Loans (i) shall,
at the option of the Company, be Base Rate Loans or Eurodollar Loans, provided
that all Tranche A Revolving Loans made as part of the same Borrowing shall,
unless otherwise specifically provided herein, consist of Tranche A Revolving
Loans of the same Type, (ii) may be repaid and reborrowed in accordance with the
provisions hereof, (iii) shall not exceed for any Bank at any time outstanding
that aggregate principal amount which, when combined with such Bank's Adjusted
Percentage, if any, of the sum of (x) the Letter of Credit Outstandings at such
time, (y) the outstanding principal amount of Swingline Loans at such time plus
(z) the Dollar Equivalent of the outstanding principal amount of Canadian Dollar
Loans at such time, equals (1) if such Bank is a Non-Defaulting Bank, the
Adjusted Tranche A Commitment of such Bank at such time and (2) if such Bank is
a Defaulting Bank, the Tranche A Revolving Loan Commitment of such Bank at such
time and (iv) shall not exceed in aggregate principal amount at any time
outstanding, when combined with the aggregate principal amount of all Swingline
Loans then outstanding, the Dollar Equivalent of the aggregate principal amount
of Canadian Dollar Loans then outstanding and the aggregate amount of all Letter
of Credit Outstandings at such time, an amount equal to the Total Tranche A
Revolving Loan Commitment at such time.
(c) Subject to and upon the terms and conditions herein set
forth, each Bank with a Tranche B Revolving Loan Commitment severally agrees at
any time and from time to time on and after the Tranche B Assumption Date with
respect to such Bank and prior to the Original Final Maturity Date, to make a
revolving loan or revolving loans (each a "Tranche B Revolving Loan" and
together with the Tranche A Revolving Loans, the "Revolving Loans") to the
Company, which Tranche B Revolving Loans (i) shall, at the option of the
Company, be Base Rate Loans or Eurodollar Loans, provided that all Tranche B
Revolving Loans made as part of the same Borrowing shall, unless otherwise
specifically provided herein, consist of Tranche B Revolving Loans of the same
Type, (ii) may be repaid and reborrowed in accordance with the provisions
hereof, (iii) shall not exceed for any Bank at any time outstanding that
aggregate principal amount which equals the Tranche B Revolving Loan Commitment
of such Bank at such time.
(d) Subject to and upon the terms and conditions herein set
forth, Chase in its individual capacity agrees to make, at any time and from
time to time on and after the Initial Borrowing Date and prior to the Swingline
Expiry Date, a revolving loan or revolving loans (each a "Swingline Loan" and,
collectively, the "Swingline Loans") to the Company, which Swingline Loans (i)
shall be made and maintained as Base Rate Loans, (ii) may be repaid and
reborrowed in accordance with the provisions hereof, (iii) shall not exceed in
aggregate principal amount at any time outstanding, when combined with the
aggregate principal amount of all Tranche A Revolving Loans made by
Non-Defaulting Banks then outstanding, the Dollar Equivalent of the principal
amount of all Canadian Dollar Loans then outstanding and the Letter of Credit
Outstandings at such time, an amount equal to the Adjusted Total Tranche A
Commitment then in effect (after giving effect to any reductions to the Adjusted
Total Tranche A Commitment on such date) and (iv) shall not exceed in aggregate
principal amount at any time outstanding the Maximum Swingline Amount. Chase
will not make a Swingline Loan after it has received written notice from the
Required Banks that one or more of the applicable conditions to Credit Events
specified in Section 5 are not then satisfied.
-3-
(e) On any Business Day, Chase may, in its sole discretion,
give notice to the Banks that its outstanding Swingline Loans shall be funded
with a Borrowing of Tranche A Revolving Loans (provided that each such notice
shall be deemed to have been automatically given upon the occurrence of an Event
of Default under Section 9.05), in which case a Borrowing of Tranche A Revolving
Loans constituting Base Rate Loans (each such Borrowing, a "Mandatory
Borrowing") shall be made on the immediately succeeding Business Day by all
Banks with a Tranche A Revolving Loan Commitment pro rata based on each Bank's
Adjusted Percentage (determined before giving effect to any termination of the
Tranche A Revolving Loan Commitments pursuant to the last paragraph of Section
9), and the proceeds thereof shall be applied directly to repay Chase for such
outstanding Swingline Loans. Each such Bank hereby irrevocably agrees to make
Base Rate Loans upon one Business Day's notice pursuant to each Mandatory
Borrowing in the amount and in the manner specified in the preceding sentence
and on the date specified in writing by Chase notwithstanding (i) that the
amount of the Mandatory Borrowing may not comply with the Minimum Borrowing
Amount otherwise required hereunder, (ii) whether any conditions specified in
Section 5 are then satisfied, (iii) whether a Default or an Event of Default has
occurred and is continuing, (iv) the date of such Mandatory Borrowing and (v)
any reduction in the Total Tranche A Revolving Loan Commitment or Adjusted Total
Tranche A Commitment after any such Swingline Loans were made. In the event that
any Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the commencement
of a proceeding under the Bankruptcy Code in respect of the Company), then each
such Bank (other than Chase) hereby agrees that it shall forth-with purchase (as
of the date the Mandatory Borrowing would otherwise have occurred, but adjusted
for any payments received from the Company on or after such date and prior to
such purchase) from Chase (without recourse or warranty other than that such
Swingline Loans are free and clear of any Liens) such assignment of the
outstanding Swingline Loans as shall be necessary to cause such Banks to share
in such Swingline Loans ratably based upon their respective Adjusted Percentages
(determined before giving effect to any termination of the Tranche A Revolving
Loan Commitments pursuant to the last paragraph of Section 9), provided that all
interest payable on the Swingline Loans shall be for the account of Chase until
the date the respective assignment is purchased and, to the extent attributable
to the purchased assignment, shall be payable to the Bank purchasing same from
and after such date of purchase. Upon any change in the Tranche A Revolving Loan
Commitments or Adjusted Percentages of the Banks pursuant to Section 1.10(c)(ii)
or 12.04(b), or upon the occurrence of a Bank Default, it is hereby agreed that,
with respect to all outstanding Swingline Loans, there shall be an automatic
adjustment to the participations pursuant to this Section 1.01(e) to reflect the
new Adjusted Percentages of the assigning and assignee Banks or of all
Non-Defaulting Banks, as the case may be.
(f) Subject to and upon the terms and conditions herein set
forth, the Canadian Lender in its individual capacity agrees to make, at any
time and from time to time on and after the Initial Borrowing Date and prior to
the Original Final Maturity Date, a revolving loan or revolving loans (each a
"Canadian Dollar Loan" and, collectively, the "Canadian Dollar Loans") to the
Canadian Borrower, which Canadian Dollar Loans (i) shall, at the option of the
Canadian Borrower, be Base Rate Loans or Eurodollar Loans, provided that all
Canadian Dollar Loans made as part of the same Borrowing shall, unless otherwise
specifically provided herein,
-4-
consist of Canadian Dollar Loans of the same Type, (ii) may be repaid and
reborrowed in accordance with the provisions hereof, (iii) shall not exceed in
Dollar Equivalent aggregate principal amount at any time outstanding, when
combined with the aggregate principal amount of all Tranche A Revolving Loans
made by Non-Defaulting Banks then outstanding, the aggregate principal amount of
all Swingline Loans then outstanding and the Letter of Credit Outstandings at
such time, an amount equal to the Adjusted Total Tranche A Commitment then in
effect (after giving effect to any reductions to the Adjusted Total Tranche A
Commitment on such date) and (iv) shall not exceed in Dollar Equivalent
aggregate principal amount at any time outstanding the Maximum Canadian Dollar
Amount. The Canadian Lender will not make a Canadian Dollar Loan after it has
received written notice from the Required Banks that one or more of the
applicable conditions to Credit Events specified in Section 5 are not then
satisfied. On the date of the making of any Canadian Dollar Loan, the Canadian
Lender shall notify the Administrative Agent and the Canadian Borrower of the
Dollar Equivalent of such Borrowing of Canadian Dollar Loans on such date.
(g) On any Business Day, the Canadian Lender may, in its sole
discretion, give notice to the Banks that all outstanding Canadian Dollar Loans
shall be assigned to the Banks (provided that such notice shall be deemed to
have been automatically given upon the occurrence of an Event of Default under
Section 9.05). Each Bank with a Tranche A Revolving Loan Commitment hereby
irrevocably and unconditionally agrees that in the event that any such notice is
given or deemed given, such Bank shall purchase from the Canadian Lender
(without recourse or warranty other than that such Canadian Dollar Loans are
free and clear of any Liens) an assignment of the outstanding Canadian Dollar
Loans in an amount equal to such Bank's Adjusted Percentage of such outstanding
Canadian Dollar Loans in accordance with the provisions of this Section 1.01(g).
Any such purchase shall be made on the second immediately succeeding Business
Day, on which Business Day each such Bank shall pay to the Administrative Agent
for the account of the Canadian Lender an amount equal to such Bank's Adjusted
Percentage of all outstanding Canadian Dollar Loans in Canadian Dollars and same
day funds. If and to the extent any such Bank shall not have so made its
Adjusted Percentage of the outstanding principal amount of the Canadian Dollar
Loans available to the Administrative Agent for the account of the Canadian
Lender, such Bank agrees to pay to the Administrative Agent for the account of
the Canadian Lender, forthwith on demand such amount, together with interest
thereon, for each day from such date until the date such amount is paid to the
Administrative Agent for the account of the Canadian Lender at the overnight
Federal Funds rate. All interest payable on the Canadian Dollar Loans shall be
for the account of the Canadian Lender until the date the respective assignment
is purchased and, to the extent attributable to the purchased assignment, shall
be payable to the Bank purchasing same from and after such date of purchase. The
failure of any such Bank to make available to the Administrative Agent for the
account of the Canadian Lender its Adjusted Percentage of the outstanding
principal amount of Canadian Dollar Loans shall not relieve any other Bank of
its obligation hereunder to make available to the Administrative Agent for the
account of the Canadian Lender its Adjusted Percentage of the outstanding
principal amount of Canadian Dollar Loans on the date required, as specified
above, but no Bank shall be responsible for the failure of any other Bank to
make available to the Administrative Agent for the account of the Canadian
Lender such other Bank's Adjusted Percentage of any such payment. Each such Bank
hereby irrevocably agrees to
-5-
purchase its Adjusted Percentage of the outstanding Canadian Dollar Loans in the
manner specified above and on the date specified above notwithstanding (i)
whether any conditions specified in Section 5 are then satisfied, (ii) whether a
Default or an Event of Default has occurred and is continuing, (iii) the date of
such purchase and (iv) any reduction in the Total Tranche A Revolving Loan
Commitment or Adjusted Total Tranche A Commitment after any such Canadian Dollar
Loans were made. Notwithstanding the foregoing, to the extent any Bank
determines that at the time of a purchase of Canadian Dollar Loans pursuant to
this Section 1.01(g), it is unable to obtain Canadian Dollars with which to fund
such purchase, it may, upon notice to the Canadian Lender and the Administrative
Agent, fund such purchase in U.S. Dollars in an aggregate amount which the
Canadian Lender determines, in its sole discretion, is equivalent to what the
Canadian Lender would have received if such Bank had funded in Canadian Dollars.
(h) Subject to and upon the terms and conditions set forth
herein, each Bank with a B Term Loan Commitment severally agrees to make, on the
Restatement Effective Date, a term loan or term loans (each a "B Term Loan" and,
collectively, the "B Term Loans") to the Company, which B Term Loans (i) shall
be made pursuant to a single drawing, (ii) shall, at the option of the Company,
be Base Rate Loans or Eurodollar Loans, provided that all B Term Loans made as
part of the same Borrowing shall, unless otherwise specifically provided herein,
consist of B Term Loans of the same Type, (iii) shall equal for each Bank, in
initial aggregate principal amount, that amount which equals the B Term Loan
Commitment of such Bank on the Restatement Effective Date (before giving effect
to the termination thereof on such date pursuant to Section 3.03(f)). Once
repaid, B Term Loans incurred hereunder may not be reborrowed.
1.02 Minimum Borrowing Amounts, etc. The aggregate principal
amount of each Borrowing shall not be less than the Minimum Borrowing Amount for
such Loans. More than one Borrowing may be incurred on any day, provided that at
no time shall there be outstanding more than 20 Borrowings of Eurodollar Loans.
1.03 Notice of Borrowing. (a) Whenever the Company desires to
incur Loans hereunder (excluding Swingline Loans, Canadian Dollar Loans, and
Revolving Loans incurred pursuant to a Mandatory Borrowing), it shall give the
Administrative Agent at its Notice Office, prior to 12:00 Noon (New York time),
at least three Business Days' prior written notice (or telephonic notice
promptly confirmed in writing) of each Borrowing of Eurodollar Loans and at
least one Business Day's prior written notice (or telephonic notice promptly
confirmed in writing) of each Borrowing of Base Rate Loans to be incurred
hereunder. Each such notice (each, together with each notice referred to in
Sections 1.03(b)(i) and 1.03(c), a "Notice of Borrowing"), except as otherwise
expressly provided in Section 1.10, shall be irrevocable, and, in the case of
each written notice and each confirmation of telephonic notice, shall be in the
form of Exhibit A, appropriately completed to specify (i) whether the Loans
being incurred pursuant to such Borrowing shall consist of Term Loans, B Term
Loans, Tranche A Revolving Loans or Tranche B Revolving Loans, (ii) the
aggregate principal amount of such Loans to be made pursuant to such Borrowing,
(iii) the date of such Borrowing (which shall be a Business Day) and (iv)
whether the respective Borrowing shall consist of Base Rate Loans or Eurodollar
Loans and, if Eurodollar Loans, the Interest Period to be initially applicable
thereto. The Administrative Agent
-6-
shall promptly give each Bank which is required to make Loans pursuant to the
Borrowing specified in the respective Notice of Borrowing written notice (or
telephonic notice promptly confirmed in writing) of each proposed Borrowing, of
such Bank's proportionate share thereof, if any, and of the other matters
covered by the Notice of Borrowing.
(b) (i) Whenever the Company desires to incur a Borrowing of
Swingline Loans hereunder, it shall give Chase no later than 12:00 Noon (New
York time) on the day such Swingline Loan is to be made, written notice (or
telephonic notice promptly confirmed in writing) of each Swingline Loan to be
incurred hereunder. Each such Notice of Borrowing shall be irrevocable and shall
specify in each case (x) the date of such Borrowing (which shall be a Business
Day) and (y) the aggregate principal amount of the Swingline Loans to be
incurred pursuant to such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice
specified in Section 1.01(e), with the Company irrevocably agreeing, by its
incurrence of any Swingline Loan, to the making of Mandatory Borrowings as set
forth in such Section.
(c) Whenever the Canadian Borrower desires to incur a
Borrowing of Canadian Dollar Loans hereunder, it shall give the Canadian Lender
and the Administrative Agent, prior to 12:00 Noon (New York time), at least
three Business Days' prior written notice (or telephonic notice promptly
confirmed in writing) of each Borrowing of Eurodollar Loans and at least one
Business Day's prior written notice (or telephonic notice promptly confirmed in
writing) of each Borrowing of Base Rate Loans to be incurred hereunder. Each
such Notice of Borrowing, except as otherwise expressly provided in Section
1.10, shall be irrevocable and shall specify in each case (i) the date of such
Borrowing (which shall be a Business Day), (ii) the aggregate principal amount
of the Canadian Dollar Loan to be made pursuant to such Borrowing and (iii)
whether the respective Borrowing shall consist of Base Rate Loans or Eurodollar
Loans and, if Eurodollar Loans, the Interest Period to be initially applicable
thereto.
(d) Without in any way limiting the obligation of either
Borrower to confirm in writing any telephonic notice permitted to be given
hereunder, the Administrative Agent, Chase (in the case of a Borrowing of
Swingline Loans), the Canadian Lender (in the case of a Borrowing of Canadian
Dollar Loans) or the Letter of Credit Issuer (in the case of the issuance of
Letters of Credit), as the case may be, may prior to receipt of written
confirmation act without liability upon the basis of such telephonic notice,
believed by the Administrative Agent, Chase, the Canadian Lender or the Letter
of Credit Issuer, as the case may be, in good faith to be from the chairman, a
vice chairman, the president, a vice president, a treasurer, an assistant
treasurer or the director of treasury operations of such Borrower. In each such
case, each Borrower hereby waives the right to dispute the Administrative
Agent's, Chase's, the Canadian Lender's or the Letter of Credit Issuer's record
of the terms of such telephonic notice.
1.04 Disbursement of Funds. (a) No later than 1:00 P.M. (New
York time) on the date specified in each Notice of Borrowing relating to any
Loans other than Canadian Dollar Loans (or (x) in the case of Swingline Loans,
no later than 2:00 P.M. (New York time) on the date specified pursuant to
Section 1.03(b)(i) or (y) in the case of Mandatory Borrowings, no later
-7-
than 12:00 Noon (New York time) on the date specified in Section 1.01(e)), each
Bank with a Commitment under the respective Tranche will make available its Pro
Rata Share (if any) of each Borrowing of Loans requested to be made on such date
in the manner provided below (or, in the case of Swingline Loans, Chase will
make available the full amount thereof). All such amounts shall be made
available to the Administrative Agent in U.S. Dollars and immediately available
funds at the Payment Office and the Administrative Agent promptly will make
available to the Company by depositing to its account at the Payment Office the
aggregate of the amounts so made available in the type of funds received (other
than in respect of Mandatory Borrowings). Unless the Administrative Agent shall
have been notified by any Bank prior to the date of Borrowing of any Loans
referred to in this Section 1.04(a) that such Bank does not intend to make
available to the Administrative Agent its portion of the Borrowing or Borrowings
to be made on such date, the Administrative Agent may assume that such Bank has
made such amount available to the Administrative Agent on such date of
Borrowing, and the Administrative Agent, in reliance upon such assumption, may
(in its sole discretion and without any obligation to do so) make available to
the Company a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent by such Bank and the Administrative
Agent has made available same to the Company, the Administrative Agent shall be
entitled to recover such corresponding amount from such Bank. If such Bank does
not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent shall promptly notify the Company, and
the Company shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from the Bank or the Company, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Company to the date such
corresponding amount is recovered by the Administrative Agent, at a rate per
annum equal to (x) if paid by such Bank, the overnight Federal Funds rate or (y)
if paid by the Company, the then applicable rate of interest, calculated in
accordance with Section 1.08, for the respective Loans. Nothing herein shall be
deemed to relieve any Bank from its obligation to fulfill its commitments
hereunder or to prejudice any rights which the Company may have against any Bank
as a result of any failure by such Bank to make Loans hereunder.
(b) No later than 1:00 P.M. (New York time) on the date
specified in each Notice of Borrowing relating to Canadian Dollar Loans, the
Canadian Lender will make available to the Canadian Borrower such Canadian
Dollar Loans requested to be made on such date, in Canadian Dollars and in
immediately available funds at the Canadian Payment Office.
1.05 Register. (a) The Administrative Agent shall maintain a
register for the recordation of the Commitments of the Banks from time to time
and the principal amount of the Term Loans, B Term Loans, Tranche A Revolving
Loans, Tranche B Revolving Loans, Swingline Loans and Canadian Dollar Loans
owing to each Bank (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error. The Register
shall be available for inspection by the Company or any Bank at any reasonable
time and from time to time upon reasonable prior notice.
-8-
(b) Each Borrower hereby agrees to provide a Note, promptly
upon the request of any Bank, to the extent such Bank has requested such Note in
connection with any pledge or assignment by such Bank of any or all of its Loans
hereunder to a Federal Reserve Bank.
1.06 Conversions. Either Borrower shall have the option to
convert on any Business Day all or a portion at least equal to the applicable
Minimum Borrowing Amount of the outstanding principal amount of the Loans (other
than Swingline Loans, which at all times shall be maintained as Base Rate Loans)
owing by a Borrower into a Borrowing or Borrowings of another Type of Loan;
provided that (i) no such partial conversion of a Borrowing of Eurodollar Loans
shall reduce the outstanding principal amount of the Eurodollar Loans made
pursuant to such Borrowing to less than the Minimum Borrowing Amount applicable
thereto, (ii) Base Rate Loans may not be converted into Eurodollar Loans if a
Default or Event of Default is in existence and the Administrative Agent and/or
the Required Banks have notified the Company that such a conversion will not be
permitted as a result thereof and (iii) Borrowings of Eurodollar Loans resulting
from this Section 1.06 shall be limited in number as provided in Section 1.02.
Each such conversion shall be effected by the respective Borrower by giving the
Administrative Agent at its Notice Office (and, in the case of any proposed
conversion of Canadian Dollar Loans, the Canadian Lender at the Canadian Notice
Office), prior to 12:00 Noon (New York time), at least three Business Days (or
one Business Day in the case of a conversion into Base Rate Loans) prior written
notice (or telephonic notice promptly confirmed in writing) (each a "Notice of
Conversion") specifying the Loans to be so converted, the Type of Loans to be
converted into and, if to be converted into a Borrowing of Eurodollar Loans, the
Interest Period to be initially applicable thereto. The Administrative Agent
shall give each Bank prompt notice of any such proposed conversion affecting any
of its Loans.
1.07 Pro Rata Borrowings. All Borrowings of Term Loans, B Term
Loans, Tranche A Revolving Loans and Tranche B Revolving Loans under this
Agreement shall be made by the Banks pro rata on the basis of their Term Loan
Commitments, B Term Loan Commitments, Tranche A Revolving Loan Commitments or
Tranche B Revolving Loan Commitments, as the case may be, provided that all
Borrowings of Tranche A Revolving Loans made pursuant to a Mandatory Borrowing
shall be incurred from the Banks with Tranche A Revolving Loan Commitments pro
rata on the basis of their Adjusted Percentages. It is understood that no Bank
shall be responsible for any default by any other Bank of its obligation to make
Loans hereunder and that each Bank shall be obligated to make the Loans to be
made by it hereunder, regardless of the failure of any other Bank to make its
Loans hereunder.
1.08 Interest. (a) The unpaid principal amount of each Base
Rate Loan shall bear interest from the date of the Borrowing thereof until
maturity (whether by acceleration or otherwise) at a rate per annum which shall
at all times be the Applicable Margin (or, in the case of B Term Loans, the
Applicable B Term Loan Margin) plus the Base Rate in effect from time to time.
(b) The unpaid principal amount of each Eurodollar Loan shall
bear interest from the date of the Borrowing thereof until maturity (whether by
acceleration or otherwise) at a rate
-9-
per annum which shall at all times be the Applicable Margin (or, in the case of
B Term Loans, the Applicable B Term Loan Margin) plus the relevant Eurodollar
Rate.
(c) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan shall bear interest at a rate per annum
equal to the Base Rate in effect from time to time plus the sum of (i) 2% and
(ii) the Applicable Margin (or, in the case of B Term Loans, 1.75%) for Base
Rate Loans; provided that principal in respect of Eurodollar Loans shall bear
interest after the same becomes due (whether by acceleration or otherwise) until
the end of the applicable Interest Period for such Eurodollar Loan at a per
annum rate equal to 2% in excess of the rate of interest applicable on the due
date therefor.
(d) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any repayment thereof and shall be
payable (i) in respect of each Base Rate Loan, quarterly in arrears on the last
Business Day of each March, June, September and December, (ii) in respect of
each Eurodollar Loan, on the last day of each Interest Period applicable thereto
and, in the case of an Interest Period in excess of three months, on each date
occurring at three month intervals after the first day of such Interest Period
and (iii) in respect of each Loan, on any prepayment or conversion (on the
amount prepaid or converted), at maturity (whether by acceleration or otherwise)
and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section 12.07(b).
(f) The Administrative Agent, upon determining the interest
rate for any Borrowing of Eurodollar Loans for any Interest Period, shall
promptly notify the respective Borrower and the Banks thereof.
1.09 Interest Periods. At the time either Borrower gives a
Notice of Borrowing or Notice of Conversion in respect of the making of, or
conversion into, a Borrowing of Eurodollar Loans (in the case of the initial
Interest Period applicable thereto) or prior to 12:00 Noon (New York time) on
the third Business Day prior to the expiration of an Interest Period applicable
to a Borrowing of Eurodollar Loans, it shall have the right to elect by giving
the Administrative Agent written notice (or telephonic notice promptly confirmed
in writing) of the Interest Period applicable to such Borrowing, which Interest
Period shall, at the option of the respective Borrower, be a one, two, three,
six or, if available to each of the Banks (as determined by each such Bank in
good faith based on prevailing conditions in the interbank Eurodollar market on
any date of determination thereof) (available to the Canadian Lender in the case
of the Canadian Dollar Loans), nine or twelve month period. Notwithstanding
anything to the contrary contained above:
(i) the initial Interest Period for any Borrowing of Eurodollar
Loans shall commence on the date of such Borrowing (including the date
of any conversion from a Borrowing of Base Rate Loans) and each
Interest Period occurring thereafter in respect of such Borrowing shall
commence on the day on which the next preceding Interest Period
applicable thereto expires;
-10-
(ii) if any Interest Period begins on a day for which there is
no numerically corresponding day in the calendar month at the end of
such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iii) if any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day, provided that if any Interest Period
would otherwise expire on a day which is not a Business Day but is a
day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business
Day;
(iv) no Interest Period in respect of Term Loans, Tranche A
Revolving Loans or Tranche B Revolving Loans shall extend beyond the
Original Final Maturity Date, and no Interest Period in respect of B
Term Loans shall extend beyond the Final Maturity Date; and
(v) no Interest Period may be elected at any time when a
Default or Event of Default is then in existence and the Administrative
Agent and/or the Required Banks have notified the Company that such an
election will not be permitted as a result thereof.
If upon the expiration of any Interest Period, the respective Borrower has
failed to elect a new Interest Period to be applicable to the respective
Borrowing of Eurodollar Loans as provided above, or a Default or an Event of
Default then exists and the Administrative Agent and/or the Required Banks have
given the notice referred to in clause (v) above, such Borrower shall be deemed
to have elected to convert such Borrowing into a Borrowing of Base Rate Loans
effective as of the expiration date of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that
(x) in the case of clause (i) below, the Administrative Agent (or the Canadian
Lender in the case of Canadian Dollar Loans) or (y) in the case of clauses (ii)
and (iii) below, any Bank, shall have determined (which determination shall,
absent manifest error, be final and conclusive and binding upon all parties
hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period that, by reason of any changes arising after the date
of this Agreement affecting the interbank Eurodollar market, adequate
and fair means do not exist for ascertaining the applicable interest
rate on the basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect
to any Eurodollar Loans because of (x) any change since the date of
this Agreement in any applicable law, governmental rule, regulation,
guideline, order or request (whether or not having the force of law),
or in the interpretation or administration thereof and including the
introduction of any new law or governmental rule, regulation,
guideline, order or request such as, for example, but not limited to,
(A) a change since the Original Effective Date in the basis of taxation
of payment to any Bank of the principal of or interest on the Loans or
any other amounts payable hereunder (except for changes with respect to
Taxes and those taxes described in
-11-
clauses (x) and (y) of the proviso in the second sentence of Section
4.04) or (B) a change since the Original Effective Date in official
reserve requirements, but, in all events, excluding reserves required
under Regulation D to the extent included in the computation of the
Eurodollar Rate and/or (y) other circumstances affecting such Bank, the
interbank Eurodollar market or the position of such Bank in such
market; or
(iii) at any time since the Original Effective Date, that the
making or continuance of any Eurodollar Loan has become unlawful by
compliance by such Bank in good faith with any law, governmental rule,
regulation, guideline or order (or would conflict with any such
governmental rule, regulation, guideline or order not having the force
of law but with which such Bank customarily complies even though the
failure to comply therewith would not be unlawful), or has become
impracticable as a result of a contingency occurring after the Original
Effective Date which materially and adversely affects the interbank
Eurodollar market;
then, and in any such event, such Bank (or the Administrative Agent in the case
of clause (i) above) shall (x) on such date and (y) within 10 Business Days of
the date on which such event no longer exists give notice (by telephone
confirmed in writing) to each Borrower and (except in the case of clause (i)) to
the Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Banks). Thereafter (x) in the
case of clause (i) above, Eurodollar Loans shall no longer be available until
such time as the Administrative Agent notifies the Borrowers and the Banks that
the circumstances giving rise to such notice by the Administrative Agent no
longer exist, and any Notice of Borrowing or Notice of Conversion given by a
Borrower with respect to Eurodollar Loans which have not yet been incurred shall
be deemed rescinded by such Borrower, (y) in the case of clause (ii) above, the
Company (or, in the case of Canadian Dollar Loans, each of the Company and the
Canadian Borrower) agrees to pay to such Bank, upon written demand therefor
(accompanied by the written notice referred to below), such additional amounts
(in the form of an increased rate of, or a different method of calculating,
interest or otherwise as such Bank in its sole discretion shall determine) as
shall be required to compensate such Bank for such increased costs or reductions
in amounts received or receivable hereunder (a written notice as to the
additional amounts owed to such Bank, showing the basis for the calculation
thereof, submitted to the respective Borrower by such Bank shall, absent
manifest error, be final and conclusive and binding upon all parties hereto) and
(z) in the case of clause (iii) above, the respective Borrower shall take one of
the actions specified in Section 1.10(b) as promptly as possible and, in any
event, within the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the respective Borrower
may (and in the case of a Eurodollar Loan affected pursuant to Section
1.10(a)(iii) the respective Borrower shall) either (i) if the affected
Eurodollar Loan is then being made pursuant to a Borrowing, cancel said
Borrowing by giving the Administrative Agent telephonic notice (confirmed
promptly in writing) thereof promptly (but in any event no later than the later
of (x) the Business Day next preceding the date of such Borrowing and (y) one
Business Day after the respective Borrower was notified by a Bank pursuant to
Section 1.10(a)(ii) or (iii)), or (ii) if the affected Eurodollar Loan is then
-12-
outstanding, upon at least three Business Days' notice to the Administrative
Agent, require the affected Bank to convert each such Eurodollar Loan into a
Base Rate Loan (which conversion, in the case of the circumstances described in
Section 1.10(a)(iii), shall occur no later than the last day of the Interest
Period then applicable to such Eurodollar Loan (or such earlier date as shall be
required by applicable law)); provided that if more than one Bank is affected at
any time, then all affected Banks must be treated the same pursuant to this
Section 1.10(b).
(c) (i) If any Bank shall have determined that after the
Original Effective Date, the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by such Bank with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Bank's capital or assets as a consequence of its
commitments or obligations hereunder to a level below that which such Bank could
have achieved but for such adoption, change or compliance (taking into
consideration such Bank's policies with respect to capital adequacy), then from
time to time, within 15 days after demand by such Bank (with a copy to the
Administrative Agent), accompanied by the notice referred to in the last
sentence of this clause (i), the Company shall pay to such Bank such additional
amount or amounts as will compensate such Bank for such reduction. Each Bank,
upon determining in good faith that any additional amounts will be payable
pursuant to this Section 1.10(c), will give prompt written notice thereof to the
Company, which notice shall set forth the basis of the calculation of such
additional amounts, although the failure to give any such notice shall not
release or diminish the Company's obligations to pay additional amounts pursuant
to this Section 1.10(c).
(ii) If (x) any Bank becomes a Defaulting Bank or otherwise
defaults in its obligations to make Loans or fund Unpaid Drawings, (y) any Bank
has notified the Borrower that one of its Eurodollar Loans is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), or (z) any Bank is owed
increased costs or other amounts under Section 1.10(c)(i), 2.06 or 4.04 and, in
the case of such clause (y) or (z), compensation or other action with respect to
such event is not otherwise requested generally by the other Banks, the Company
shall have the right, if no Default or Event of Default then exists and, in the
case of a Bank described in clause (y) or (z) above, such Bank has not changed
its applicable lending office with the effect of eliminating such increased
cost, to replace such Bank (the "Replaced Bank") with another commercial bank or
banks or other financial institutions (collectively, the "Replacement Bank")
reasonably acceptable to the Administrative Agent, and, in the case of any
Replaced Bank with a Tranche A Revolving Loan Commitment, the Canadian Lender
and the Letter of Credit Issuer, provided that (i) at the time of any
replacement pursuant to this Section 1.10(c)(ii), the Replacement Bank shall
enter into one or more assignment agreements pursuant to Section 12.04(b) hereof
(and with all fees payable pursuant to said Section 12.04(b) to be paid by the
Replacement Bank) pursuant to which the Replacement Bank shall acquire all of
the Commitments and outstanding Loans of, and participations in Letters of
Credit by, the Replaced Bank and, in connection therewith, shall pay to the
Replaced Bank (or the Letter of Credit Issuer in the case of the proviso
contained in clause (b) below, the Canadian Lender in the case of clause (c)
below or Chase in the case of
-13-
clause (d) below) in respect thereof an amount equal to the sum of (a) an amount
equal to the principal of, and all accrued interest on, all outstanding Loans of
the Replaced Bank, (b) an amount equal to the sum of such Replaced Bank's
Adjusted Percentage (for this purpose, determined as if the adjustment described
in clause (y) of the immediately succeeding sentence had been made with respect
to such Replaced Bank) of all Unpaid Drawings and all then unpaid interest with
respect thereto at such time, provided that in the event such Replaced Bank did
not reimburse the Letter of Credit Issuer pursuant to Section 2.05(c) in respect
of any Unpaid Drawing, such amount shall instead be paid to the Letter of Credit
Issuer, (c) an amount equal to any unpaid obligation of the Replaced Bank
pursuant to Section 1.01(g), which amount shall be paid to the Canadian Lender,
(d) an amount equal to any unpaid obligation of the Replaced Bank pursuant to
Section 1.01(e), which amount shall be paid to Chase, and (e) an amount equal to
all accrued, but theretofore unpaid, Fees owing to the Replaced Bank pursuant to
Section 3.01 hereof and (ii) all obligations of each Borrower owing to the
Replaced Bank (other than those specifically described in clause (i) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full to such Replaced Bank concurrently with such
replacement. Upon the execution of the respective assignment documentation
pursuant to clause (i) above and the payment of amounts referred to in clauses
(i) above and (ii) above, (x) the Replacement Bank shall become a Bank or Banks
hereunder, as the case may be, and the Replaced Bank shall cease to constitute a
Bank hereunder, except with respect to indemnification provisions (including,
without limitation, Sections 1.10, 1.11, 2.06, 4.04, 11.07 and 12.01 of this
Agreement) under this Agreement, which shall survive as to such Replaced Bank
and (y) the Adjusted Percentages of the Banks shall be automatically adjusted at
such time to give effect to such replacement (and to give effect to the
replacement of a Defaulting Bank with one or more Non-Defaulting Banks).
1.11 Compensation. The Company (or, in the case of Canadian
Dollar Loans, each of the Company and the Canadian Borrower) agrees to
compensate each Bank in the appropriate currency, upon its written request
(which request shall set forth the basis for requesting such compensation), for
all reasonable losses, expenses and liabilities (including, without limitation,
any loss, expense or liability incurred by reason of the liquidation or
reemployment of deposits or other funds required by such Bank to fund its
Eurodollar Loans but excluding loss of anticipated profit with respect to any
Loans) which such Bank may sustain: (i) if for any reason (other than a default
by such Bank or the Administrative Agent) a Borrowing of Eurodollar Loans does
not occur on a date specified therefor in a Notice of Borrowing or Notice of
Conversion (whether or not withdrawn by the respective Borrower or deemed
withdrawn pursuant to Section 1.10(a)); (ii) if any repayment, prepayment or
conversion of any Eurodollar Loans occurs on a date which is not the last day of
an Interest Period applicable thereto; (iii) if any prepayment of any Eurodollar
Loans is not made on any date specified in a notice of prepayment given by a
Borrower; or (iv) as a consequence of (x) any other default by a Borrower to
repay its Loans when required by the terms of this Agreement or (y) an election
made pursuant to Section 1.10(b). Calculation of all amounts payable to a Bank
under this Section 1.11 shall be made as though that Bank had actually funded
its relevant Eurodollar Loan through the purchase of a Eurodollar deposit
bearing interest at the Eurodollar Rate in an amount equal to the amount of that
Loan, having a maturity comparable to the relevant Interest Period and through
the transfer of such Eurodollar deposit from an offshore office of that Bank to
a domestic office of
-14-
that Bank in the United States of America (or Canada, in the case of Canadian
Dollar Loans); provided, however, that each Bank may fund each of its Eurodollar
Loans in any manner it sees fit and the foregoing assumption shall be utilized
only for the calculation of amounts payable under this Section 1.11.
1.12 Change of Lending Office. Each Bank agrees that, upon the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c)(i), 2.06 or 4.04 with respect to such Bank, it will, if
requested by the respective Borrower, use reasonable efforts (subject to overall
policy considerations of such Bank) to designate another lending office for any
Loans or Letters of Credit affected by such event; provided that such
designation is made on such terms that in the sole judgment of such Bank, such
Bank and its lending office suffer no economic, legal or regulatory
disadvantage, with the object of avoiding the consequences of the event giving
rise to the operation of any such Section. Nothing in this Section 1.12 shall
affect or postpone any of the obligations of either Borrower or the right of any
Bank provided in Sections 1.10, 2.06 or 4.04.
1.13 Tranche B Commitments. At any time and from time to time
on and after the Original Effective Date and prior to June 30, 1999, the Company
may request one or more Banks or other lending institutions to assume a Tranche
B Revolving Loan Commitment and to make Tranche B Revolving Loans to the Company
as provided in Section 1.01(c) and, in the sole discretion of each such Bank or
other institution, any such Bank or other institution may agree to so commit;
provided that (i) no Default or Event of Default then exists, (ii) the increase
in the Total Tranche B Revolving Loan Commitment pursuant to any such request
shall be in an aggregate amount of at least $50,000,000 and (iii) after giving
effect to each such increase, the Total Tranche B Revolving Loan Commitment
shall not exceed $250,000,000. The Company and each such Bank or other lending
institution (each an "Assuming Bank") which agrees to commit to make Tranche B
Revolving Loans shall execute and deliver to the Administrative Agent a Tranche
B Assumption Agreement substantially in the form of Exhibit B (with the increase
in, or in the case of a new Assuming Bank, assumption of, such Bank's Tranche B
Revolving Loan Commitment to be effective upon delivery of such Tranche B
Assumption Agreement to the Administrative Agent). The Administrative Agent
shall promptly notify each Bank as to the occurrence of the Initial Tranche B
Assumption Date and as to each Additional Tranche B Assumption Date occurring
thereafter. On each Tranche B Assumption Date, (x) Annex I shall be deemed
modified to reflect the revised Tranche B Revolving Loan Commitments of such
Banks, and (y) the Company shall pay to each such Assuming Bank such up front
fee (if any) as may have been agreed between the Company and such Assuming Bank.
Notwithstanding anything to the contrary contained in this Agreement, in
connection with any increase in the Total Tranche B Revolving Loan Commitment
after the Initial Tranche B Assumption Date, the Company shall, in coordination
with the Administrative Agent and the Banks with Tranche B Revolving Loan
Commitments, repay outstanding Tranche B Revolving Loans of certain Banks and,
if necessary, incur additional Tranche B Revolving Loans from other Banks, in
each case so that such Banks participate in each Borrowing of Tranche B
Revolving Loans pro rata on the basis of their Tranche B Revolving Loan
Commitments (after giving effect to any increase thereof). It is hereby agreed
that any breakage costs of the type described in
-15-
Section 1.11 incurred by the Banks in connection with the repayment of Tranche B
Revolving Loans contemplated by this Section 1.13 shall be for the account of
the Company.
SECTION 2. Letters of Credit.
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions herein set forth, the Company may request the Letter of Credit Issuer
at any time and from time to time on or after the Initial Borrowing Date and
prior to the Business Day next preceding the Original Final Maturity Date to
issue, for the account of the Company and in support of (x) trade obligations of
the Company and/or its Restricted Subsidiaries and/or (y) on a standby basis,
such other obligations (contingent or otherwise) of the Company and/or its
Restricted Subsidiaries to any other Person, in each case, that arise in the
ordinary course of business and are in respect of general corporate purposes
(including, without limitation, in connection with Permitted Acquisitions) of
the Company and/or its Restricted Subsidiaries, and subject to and upon the
terms and conditions herein set forth the Letter of Credit Issuer agrees to
issue from time to time, irrevocable letters of credit in such form as may be
approved by the Letter of Credit Issuer and the Administrative Agent (each such
letter of credit, a "Letter of Credit" and collectively, the "Letters of
Credit").
(b) Notwithstanding the foregoing, (i) no Letter of Credit
shall be issued the Stated Amount of which, when added to the Letter of Credit
Outstandings at such time, would exceed either (x) $40,000,000 or (y) when added
to the aggregate principal amount of all Tranche A Revolving Loans made by
Non-Defaulting Banks and Swingline Loans and the Dollar Equivalent of the
aggregate principal amount of Canadian Dollar Loans then outstanding, the
Adjusted Total Tranche A Revolving Loan Commitment at such time; (ii) each
Letter of Credit shall have an expiry date occurring not later than two years
after such Letter of Credit's date of issuance, provided that standby Letters of
Credit may provide that, absent notice to the contrary from the Letter of Credit
Issuer to the beneficiary thereof, the expiry date shall be automatically
extended for successive one year periods and (iii) no Letter of Credit shall
have an expiry date occurring later than the Business Day next preceding the
Original Final Maturity Date.
2.02 Minimum Stated Amount. The initial Stated Amount of each
Letter of Credit shall be not less than $5,000 or such lesser amount acceptable
to the Letter of Credit Issuer, provided that no more than 40 Letters of Credit
(or such greater number acceptable to the Letter of Credit Issuer) shall be
outstanding at any one time.
2.03 Letter of Credit Requests; Notices of Issuance. (a)
Whenever it desires that a Letter of Credit be issued, the Company shall give
the Administrative Agent and the Letter of Credit Issuer written notice (or
telephonic notice confirmed in writing) thereof prior to 12:00 Noon (New York
time) at least five Business Days' (or such shorter period as may be acceptable
to the 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 an application for such Letter of Credit and any
other documents that the Letter of Credit Issuer customarily requires in
connection therewith. The Administrative Agent shall promptly notify each Bank
of each Letter of Credit Request.
-16-
(b) The Letter of Credit Issuer shall, on the date of each
issuance of a Letter of Credit by it or amendment thereto, give the
Administrative Agent, each Bank and the Company written notice of the issuance
or amendment of such Letter of Credit, accompanied by a copy to the
Administrative Agent of the Letter of Credit or Letters of Credit issued by it
or of the amendment thereto.
2.04 Agreement to Repay Letter of Credit Drawings. (a) The
Company hereby agrees to reimburse the Letter of Credit Issuer, by making
payment to the Administrative Agent in immediately available funds at the
Payment Office, for any payment or disbursement made by the Letter of Credit
Issuer under any Letter of Credit issued by it (each such amount so paid or
disbursed until reimbursed, an "Unpaid Drawing") no later than one Business Day
following the date of such payment or disbursement, with interest on the amount
so paid or disbursed by the Letter of Credit Issuer, to the extent not
reimbursed prior to 1:00 P.M. (New York time) on the date of such payment or
disbursement, from and including the date paid or disbursed to but not including
the date the Letter of Credit Issuer is reimbursed therefor at a rate per annum
which shall be the Applicable Margin for Base Rate Loans plus the Base Rate as
in effect from time to time (plus an additional 2% per annum if not reimbursed
by the third Business Day after the date of such payment or disbursement), such
interest also to be payable on demand. The Letter of Credit Issuer shall provide
the Company prompt notice of any payment or disbursement made by it under any
Letter of Credit issued by it, although the failure of, or delay in, giving any
such notice shall not release or diminish the obligations of the Company under
this Section 2.04(a) or under any other Section of this Agreement.
(b) The Company's obligation under this Section 2.04 to
reimburse the Letter of Credit Issuer with respect to Unpaid Drawings
(including, in each case, interest thereon) shall be absolute and unconditional
under any and all circumstances, including, without limitation, those set forth
in Section 2.05(e)(i) through (v), inclusive, and irrespective of any setoff,
counterclaim or defense to payment which the Company may have or have had
against the Letter of Credit Issuer, the Administrative Agent or any Bank,
including, without limitation, any defense based upon the failure of any drawing
under a Letter of Credit to conform to the terms of the Letter of Credit or any
non-application or misapplication by the beneficiary of the proceeds of such
drawing; provided, however, that the Company shall not be obligated to reimburse
the Letter of Credit Issuer for any wrongful payment made by the Letter of
Credit Issuer under a Letter of Credit as a result of acts or omissions
constituting willful misconduct or gross negligence on the part of the Letter of
Credit Issuer.
2.05 Letter of Credit Participations. (a) Immediately upon the
issuance by the Letter of Credit Issuer of any Letter of Credit, the Letter of
Credit Issuer shall be deemed to have sold and transferred to each other Bank
with a Tranche A Revolving Loan Commitment, and each such Bank (each a
"Participant") shall be deemed irrevocably and unconditionally to have purchased
and received from such Letter of Credit Issuer, without recourse or warranty, an
undivided interest and participation, to the extent of such Bank's Adjusted
Percentage, in such Letter of Credit, each substitute letter of credit, each
drawing made thereunder and the obligations of the Company under this Agreement
with respect thereto (although Letter of Credit Fees shall be payable directly
to the Administrative Agent for the account of the Banks as provided in
-17-
Section 3.01(b) and the Participants shall have no right to receive any portion
of any Facing Fees) and any security therefor or guaranty pertaining thereto.
Upon any change in the Tranche A Revolving Loan Commitments or Adjusted
Percentages of the Banks pursuant to Section 1.10(c)(ii) or 12.04(b) or
otherwise, or upon the occurrence of a Bank Default, it is hereby agreed that,
with respect to all outstanding Letters of Credit and Unpaid Drawings, there
shall be an automatic adjustment to the participations pursuant to this Section
2.05 to reflect the new Adjusted Percentages of the assigning and assignee Banks
or of all Non-Defaulting Banks, as the case may be.
(b) In determining whether to pay under any Letter of Credit,
the Letter of Credit Issuer shall not have any obligation relative to the
Participants other than to determine that any documents required to be delivered
under such Letter of Credit have been delivered and that they appear to comply
on their face with the requirements of such Letter of Credit. Any action taken
or omitted to be taken by the Letter of Credit Issuer under or in connection
with any Letter of Credit if taken or omitted in the absence of gross negligence
or willful misconduct, shall not create for the Letter of Credit Issuer any
resulting liability.
(c) In the event that the Letter of Credit Issuer makes any
payment under any Letter of Credit and the Company shall not have reimbursed
such amount in full to the Letter of Credit Issuer pursuant to Section 2.04(a),
the Letter of Credit Issuer shall promptly notify the Administrative Agent, and
the Administrative Agent shall promptly notify each Participant of such failure,
and each Participant shall promptly and unconditionally pay to the
Administrative Agent for the account of the Letter of Credit Issuer, the amount
of such Participant's Adjusted Percentage of such unreimbursed payment in U.S.
Dollars and in same day funds; provided, however, that no Participant shall be
obligated to pay to the Administrative Agent its Adjusted Percentage of such
unreimbursed amount for any wrongful payment made by the Letter of Credit Issuer
under a Letter of Credit as a result of acts or omissions constituting willful
misconduct or gross negligence on the part of the Letter of Credit Issuer. If
the Administrative Agent so notifies any Participant required to fund a payment
under a Letter of Credit prior to 11:00 A.M. (New York time) on any Business
Day, such Participant shall make available to the Administrative Agent for the
account of the Letter of Credit Issuer such Participant's Adjusted Percentage of
the amount of such payment on such Business Day in same day funds. If and to the
extent such Participant shall not have so made its Adjusted Percentage of the
amount of such payment available to the Administrative Agent for the account of
the Letter of Credit Issuer, such Participant agrees to pay to the
Administrative Agent for the account of the Letter of Credit Issuer, forthwith
on demand such amount, together with interest thereon, for each day from such
date until the date such amount is paid to the Administrative Agent for the
account of the Letter of Credit Issuer at the overnight Federal Funds rate. The
failure of any Participant to make available to the Administrative Agent for the
account of the Letter of Credit Issuer its Adjusted Percentage of any payment
under any Letter of Credit shall not relieve any other Participant of its
obligation hereunder to make available to the Administrative Agent for the
account of the Letter of Credit Issuer its Adjusted Percentage of any payment
under any Letter of Credit on the date required, as specified above, but no
Participant shall be responsible for the failure of any other Participant to
make available to the Administrative Agent for the account of the Letter of
Credit Issuer such other Participant's Adjusted Percentage of any such payment.
-18-
(d) Whenever the Letter of Credit Issuer receives a payment of
a reimbursement obligation as to which the Administrative Agent has received for
the account of the Letter of Credit Issuer any payments from the Participants
pursuant to clause (c) above, the Letter of Credit Issuer shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Participant which has paid its Adjusted Percentage thereof, in U.S. Dollars and
in same day funds, an amount equal to such Participant's Adjusted Percentage of
the principal amount thereof and interest thereon accruing after the purchase of
the respective participations.
(e) The obligations of the Participants to make payments to
the Administrative Agent for the account of the Letter of Credit Issuer with
respect to Letters of Credit shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other
right which the Company may have at any time against a beneficiary
named in a Letter of Credit, any transferee of any Letter of Credit (or
any Person for whom any such transferee may be acting), the
Administrative Agent, the Letter of Credit Issuer, any Bank, or other
Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between the Company
and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or other document presented under
the Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
2.06 Increased Costs. If at any time after the Original
Effective Date, the adoption of any applicable law, rule or regulation, or any
change therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by the Letter of Credit
Issuer or any Participant with any request or directive (whether or not having
the force of law) by any such authority, central bank or comparable agency shall
either (i) impose, modify or make applicable any reserve, deposit, capital
adequacy or similar requirement against Letters of Credit issued by the Letter
of Credit Issuer or such Participant's participation therein, or (ii) impose on
the Letter of Credit Issuer or any Participant any other conditions affecting
this Agreement, any Letter of Credit or such Participant's participation
therein; and the result of any of the foregoing is to increase the cost to the
Letter of Credit Issuer or such
-19-
Participant of issuing, maintaining or participating in any Letter of Credit, or
to reduce the amount of any sum received or receivable by the Letter of Credit
Issuer or such Participant hereunder, then, upon demand to the Company by the
Letter of Credit Issuer or such Participant (a copy of which notice shall be
sent by the Letter of Credit Issuer or such Participant to the Administrative
Agent), accompanied by the certificate described in the last sentence of this
Section 2.06, the Company shall pay to the Letter of Credit Issuer or such
Participant such additional amount or amounts as will compensate the Letter of
Credit Issuer or such Participant for such increased cost or reduction. A
certificate submitted to the Company by the Letter of Credit Issuer or such
Participant, as the case may be (a copy of which certificate shall be sent by
the Letter of Credit Issuer or such Participant to the Administrative Agent),
setting forth the basis for the determination of such additional amount or
amounts necessary to compensate the Letter of Credit Issuer or such Participant
as aforesaid shall be final and conclusive and binding on the Company absent
manifest error, although the failure to deliver any such certificate shall not
release or diminish the Company's obligations to pay additional amounts pursuant
to this Section 2.06.
SECTION 3. Fees; Commitments.
3.01 Fees. (a) The Company agrees to pay to the Administrative
Agent for distribution to each Non-Defaulting Bank with a Revolving Loan
Commitment a commitment fee (the "Commitment Fee") for the period from the
Original Effective Date to but not including the date the Total Revolving Loan
Commitment has been terminated, computed at a per annum rate equal to the
Applicable Commitment Fee Percentage on the daily average Aggregate Unutilized
Revolving Loan Commitment of such Non-Defaulting Bank. Accrued Commitment Fees
shall be due and payable quarterly in arrears on the last Business Day of March,
June, September and December of each year and the date upon which the Total
Revolving Loan Commitment is terminated.
(b) The Company shall pay to the Administrative Agent for the
account of each Non-Defaulting Bank with a Tranche A Revolving Loan Commitment
pro rata on the basis of their respective Adjusted Percentages, a fee in respect
of each Letter of Credit (the "Letter of Credit Fee") computed at a rate equal
to the Applicable Letter of Credit Fee Percentage on the average daily Stated
Amount of such Letter of Credit. Accrued Letter of Credit Fees shall be due and
payable quarterly in arrears on the last Business Day of each March, June,
September and December of each year and on the date upon which the Total Tranche
A Revolving Loan Commitment shall be terminated.
(c) The Company shall pay to the Administrative Agent for the
account of the Letter of Credit Issuer a fee in respect of each Letter of Credit
issued by it (the "Facing Fee") computed at the rate of 1/4 of 1% per annum on
the average daily Stated Amount of such Letter of Credit. Accrued Facing Fees
shall be due and payable quarterly in arrears on the last Business Day of each
March, June, September and December of each year and on the date upon which the
Total Tranche A Revolving Loan Commitment shall be terminated.
-20-
(d) The Company hereby agrees to pay directly to the Letter of
Credit Issuer upon each issuance of, drawing under, and/or amendment of, a
Letter of Credit issued by it such amount as shall at the time of such issuance,
drawing or amendment be the administrative charge which the Letter of Credit
Issuer is customarily charging for issuances of, drawings under or amendments
of, letters of credit issued by it.
(e) The Company shall pay to the Administrative Agent, for its
own account, such other fees as have been agreed to in writing by the Company
and the Administrative Agent.
(f) All computations of Fees shall be made in accordance with
Section 12.07(b).
3.02 Voluntary Reduction of Commitments. Upon at least three
Business Days' prior written notice (or telephonic notice promptly confirmed in
writing) to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks), the Company
shall have the right, without premium or penalty, to terminate or partially
reduce the Total Unutilized Tranche A Revolving Loan Commitment and/or the Total
Unutilized Tranche B Revolving Loan Commitment; provided that (v) any such
termination or partial reduction shall apply to proportionately and permanently
reduce the Tranche A Revolving Loan Commitment or the Tranche B Revolving Loan
Commitment, as the case may be, of each of the Banks with such Commitments, (w)
any partial reduction pursuant to this Section 3.02 shall be in the amount of at
least $2,000,000, (x) the reduction to the Total Unutilized Tranche A Revolving
Loan Commitment shall in no case be in an amount which would cause the Tranche A
Revolving Loan Commitment of any Bank to be reduced (as required by the
preceding clause (v)) by an amount which exceeds the remainder of (i) the
Aggregate Unutilized Tranche A Commitment of such Bank as in effect immediately
before giving effect to such reduction minus (ii) such Bank's Adjusted
Percentage of the sum of (A) the aggregate principal amount of Swingline Loans
then outstanding and (B) the Dollar Equivalent of the aggregate principal amount
of Canadian Dollar Loans then outstanding, (y) each reduction to the Total
Tranche A Revolving Loan Commitment pursuant to this Section 3.02 shall reduce
the then remaining Scheduled A Commitment Reductions on a pro rata basis (based
upon the then remaining principal amount of each such Scheduled A Commitment
Reduction) and (z) each reduction to the Total Tranche B Revolving Loan
Commitment pursuant to this Section 3.02 shall reduce the then remaining
Scheduled B Commitment Reductions on a pro rata basis (based upon the then
remaining principal amount of each such Scheduled B Commitment Reduction).
3.03 Mandatory Reduction of Commitments, etc. (a) Subject to
Sections 3.02 and 3.03(g), the Total Tranche A Revolving Loan Commitment (and
the Tranche A Revolving Loan Commitment of each Bank with such a Commitment)
shall be permanently reduced on each date set forth below (provided that if any
date set forth below is not a Business Day then the permanent reduction shall
occur on the first Business Day immediately succeeding such date set forth
below) (each a "Scheduled A Commitment Reduction Date"), in the amount set forth
below opposite such date (each such reduction, as such reduction may have been
reduced pursuant to Sections 3.02 and/or 3.03(g), a "Scheduled A Commitment
Reduction"):
-21-
Scheduled A Commitment
Reduction Date Amount
---------------------- ------
June 30, 1999 $37,500,000
December 31, 1999 37,500,000
June 30, 2000 75,000,000
December 31, 2000 75,000,000
June 30, 2001 75,000,000
December 31, 2001 75,000,000
June 30, 2002 75,000,000
December 31, 2002 75,000,000
June 30, 2003 75,000,000
December 31, 2003 75,000,000
June 30, 2004 75,000,000
(b) Subject to Sections 3.02 and 3.03(g), the Total Tranche B
Revolving Loan Commitment (and the Tranche B Revolving Loan Commitment of each
Bank with such a Commitment) shall be permanently reduced on each date set forth
below (provided that if any date set forth below is not a Business Day then the
permanent reduction shall occur on the first Business Day immediately succeeding
such date set forth below) (each a "Scheduled B Commitment Reduction Date"), in
an amount equal to the product of (x) the Total Tranche B Revolving Loan
Commitment as of June 30, 1999 (immediately prior to giving effect to the
Scheduled B Commitment Reduction to occur on such date) multiplied by (y) the
percentage set forth below opposite such date (each such reduction, as such
reduction may have been reduced pursuant to Sections 3.02 and/or 3.03(g), a
"Scheduled B Commitment Reduction"):
Scheduled A Commitment
Reduction Date Amount
---------------------- ------
June 30, 1999 5%
December 31, 1999 5%
June 30, 2000 10%
December 31, 2000 10%
June 30, 2001 10%
December 31, 2001 10%
June 30, 2002 10%
December 31, 2002 10%
June 30, 2003 10%
December 31, 2003 10%
June 30, 2004 10%
(c) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Term Loan Commitment (and the Term Loan
Commitment of each Bank with such a Commitment) shall terminate on the Initial
Borrowing Date (after giving effect to the making of the Term Loans on such
date).
-22-
(d) The Total Revolving Loan Commitment (and the Revolving
Loan Commitment of each Bank) shall terminate in its entirety on the earlier of
(i) the date which is the earlier of (x) 30 days after any date on which a
Specified Change of Control Event occurs and (y) the date on which any Senior
Notes or any other Indebtedness of the Company or its Restricted Subsidiaries
are required to be repurchased, redeemed or prepaid as a result of any such
Specified Change of Control Event and (ii) the Original Final Maturity Date.
(e) With respect to any Asset Sale, (i) on the earliest of (x)
the date occurring one year after the consummation of such Asset Sale, (y) the
date, if any, following the date of consummation of such Asset Sale upon which
the Administrative Agent, on behalf of the Required Banks, shall have delivered
a written reinvestment termination notice to the Company, provided that such
notice may only be given while an Event of Default exists, and (z) the date the
Company or any of its Subsidiaries shall be required to make an offer to
purchase Senior Notes or any other Indebtedness of the Company or its Restricted
Subsidiaries (other than Indebtedness specifically relating to the assets sold
in such Asset Sale) with the proceeds received in connection with such Asset
Sale, and (ii) on any date after the earliest of the dates referred to in clause
(i) above of receipt by the Company or any of its Restricted Subsidiaries of
additional Net Cash Proceeds from such Asset Sale, in each case, the Total
Revolving Loan Commitment shall be reduced and the aggregate principal amount of
the Term Loans and the B Term Loans shall be repaid in an aggregate amount equal
to 100% of the then Remaining Net Cash Proceeds from such Asset Sale (with the
Tranche A Facility Percentage of such Remaining Net Cash Proceeds to be applied
to reduce the Total Tranche A Revolving Loan Commitment, the Tranche B Facility
Percentage to be applied to reduce the Total Tranche B Revolving Loan Commitment
and the Term Loan Facility Percentage to be applied as a repayment of the
aggregate principal amount of Term Loans, and with all such Remaining Net Cash
Proceeds to be applied as a repayment of the aggregate principal amount of the B
Term Loans after the Total Revolving Loan Commitment has terminated, all Term
Loans have been paid in full and all loans have been repaid and all commitments
terminated under the Additional Credit Agreement). Each reduction to the Total
Tranche A Revolving Loan Commitment pursuant to this Section 3.03(e) shall
reduce each of the remaining Scheduled A Commitment Reductions on a pro rata
basis (based upon the then remaining amount of each such Scheduled A Commitment
Reduction), and each reduction to the Total Tranche B Revolving Loan Commitment
pursuant to this Section 3.03(e) shall reduce each of the remaining Scheduled B
Commitment Reductions on a pro rata basis (based upon the then remaining amount
of each such Scheduled B Commitment Reduction).
(f) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total B Term Loan Commitment (and the B Term
Loan Commitment of each Bank with such a Commitment) shall terminate on the
Restatement Effective Date (after giving effect to the making of the B Term
Loans on such date).
(g) Each reduction to the Total Term Loan Commitment, the
Total B Term Loan Commitment, the Total Tranche A Revolving Loan Commitment and
the Total Tranche B Revolving Loan Commitment pursuant to this Section 3.03
shall be applied proportionately to reduce the Term Loan Commitment, the B Term
Loan Commitment, the Tranche A Revolving
-23-
Loan Commitment or the Tranche B Revolving Loan Commitment, as the case may be,
of each Bank with such a Commitment.
SECTION 4. Payments.
4.01 Voluntary Prepayments. Each Borrower shall have the right
to prepay the Loans incurred by it (and the Company on behalf of the Canadian
Borrower may, at its option, prepay the Canadian Dollar Loans incurred by the
Canadian Borrower), in whole or in part, without premium or penalty except as
otherwise provided in this Agreement, from time to time on the following terms
and conditions: (i) the Company or, in the case of any prepayment of Canadian
Dollar Loans, the Company or the Canadian Borrower, shall give the
Administrative Agent at the Notice Office written notice (or telephonic notice
promptly confirmed in writing) of its intent to prepay the Loans, whether such
Loans are Term Loans, B Term Loans, Tranche A Revolving Loans, Tranche B
Revolving Loans, Swingline Loans or Canadian Dollar Loans, the amount of such
prepayment and (in the case of Eurodollar Loans) the specific Borrowing(s)
pursuant to which made, which notice shall be given by the Company or the
Canadian Borrower, as the case may be, prior to 12:00 Noon (New York time) (x)
at least two Business Days prior to the date of such prepayment in the case of
Term Loans, B Term Loans, Revolving Loans or Canadian Dollar Loans, or (y) on
the date of such prepayment in the case of Swingline Loans, which notice shall
promptly be transmitted by the Administrative Agent to each of the Banks (or to
the Canadian Lender in the case of Canadian Dollar Loans); (ii) (x) each partial
prepayment of any Borrowing (other than a Borrowing of Swingline Loans and
Canadian Dollar Loans) shall be in an aggregate principal amount of at least
$1,000,000 and, if greater, in an integral multiple of $500,000, (y) each
partial prepayment of any Borrowing of Swingline Loans shall be in an aggregate
principal amount of at least $250,000 and, if greater, in an integral multiple
of $50,000 and (z) each partial prepayment of any Borrowing of Canadian Dollar
Loans shall be in an aggregate principal amount of at least Can. $50,000 and, if
greater, in an integral multiple of Can. $50,000, provided that no partial
prepayment of Eurodollar Loans made pursuant to a Borrowing shall reduce the
aggregate principal amount of the Loans outstanding pursuant to such Borrowing
to an amount less than the Minimum Borrowing Amount applicable thereto; (iii)
each prepayment of Term Loans or B Term Loans pursuant to this Section 4.01
shall reduce the then remaining Scheduled TL Repayments or Scheduled BTL
Repayments, as the case may be, on a pro rata basis (based upon the then
remaining principal amount of each such Scheduled TL Repayment or Scheduled BTL
Repayment, as the case may be); and (iv) each prepayment in respect of any Loans
made pursuant to a Borrowing shall be applied pro rata among such Loans;
provided that at the Company's election in connection with any prepayment of
Revolving Loans pursuant to this Section 4.01, such prepayment shall not be
applied to any Revolving Loans of a Defaulting Bank.
4.02 Mandatory Repayments. (a) (i) If on any date the sum of
(x) the aggregate outstanding principal amount of Tranche A Revolving Loans made
by Non-Defaulting Banks and Swingline Loans and the Dollar Equivalent of the
aggregate outstanding principal amount of Canadian Dollar Loans (in each case
after giving effect to all other repayments thereof on such date), plus (y) the
Letter of Credit Outstandings on such date exceeds the Adjusted Total Tranche A
Commitment as then in effect, the Company shall repay on such date the principal
of
-24-
Swingline Loans, and if no Swingline Loans are or remain outstanding, Tranche A
Revolving Loans of Non-Defaulting Banks in an aggregate amount equal to such
excess, and if no Tranche A Revolving Loans of Non-Defaulting Banks are or
remain outstanding thereafter, the Canadian Borrower shall (or, at its option,
the Company, on behalf of the Canadian Borrower, shall) repay on such date the
principal of Canadian Dollar Loans, in an aggregate amount equal to such excess.
If, after giving effect to the repayment of all outstanding Swingline Loans,
Tranche A Revolving Loans and Canadian Dollar Loans, the aggregate amount of
Letter of Credit Outstandings exceeds the Adjusted Total Tranche A Commitment
then in effect, the Company agrees to pay to the Administrative Agent an amount
in cash and/or Cash Equivalents equal to such excess (up to the aggregate amount
of Letter of Credit Outstandings) and the Administrative Agent shall hold such
payment as security for the obligations of the Company hereunder pursuant to a
cash collateral agreement to be entered into in form and substance satisfactory
to the Administrative Agent (which shall permit certain investments in Cash
Equivalents satisfactory to the Administrative Agent, until the proceeds are
applied to the secured obligations).
(ii) If on any date the aggregate outstanding principal amount
of Tranche A Revolving Loans made by any Defaulting Bank exceeds the Tranche A
Revolving Loan Commitment of such Defaulting Bank, the Company shall repay the
Tranche A Revolving Loans of such Defaulting Bank in an amount equal to such
excess.
(iii) If on any date the aggregate outstanding principal
amount of Tranche B Revolving Loans made by any Bank exceeds the Tranche B
Revolving Loan Commitment of such Bank, the Company shall repay the Tranche B
Revolving Loans of such Bank in an amount equal to such excess.
(b) If on any date the Dollar Equivalent of the aggregate
outstanding principal amount of Canadian Dollar Loans (after giving effect to
all other repayments thereof on such date) exceeds the Maximum Canadian Dollar
Amount as then in effect, the Canadian Borrower shall repay on such date the
principal of Canadian Dollar Loans in an amount such that after giving effect to
such repayment the Dollar Equivalent of the aggregate outstanding principal
amount of the Canadian Dollar Loans is equal to or less than the Maximum
Canadian Dollar Amount.
(c) In addition to any other mandatory repayments pursuant to
this Section 4.02, the Company shall repay, on each date set forth below
(provided that if any date set forth below is not a Business Day then the
repayment shall occur on the first Business Day immediately succeeding such date
set forth below) (each a "Scheduled TL Repayment Date"), the Term Loans in an
amount equal to the amount set forth below opposite such date (each such
repayment, as the same may be reduced as provided in Sections 4.01, and 4.02(e),
a "Scheduled TL Repayment"):
Scheduled TL Repayment Date Amount
--------------------------- ------
June 30, 2000 $25,000,000
December 31, 2000 25,000,000
-25-
Scheduled TL Repayment Date Amount
--------------------------- ------
June 30, 2001 25,000,000
December 31, 2001 25,000,000
June 30, 2002 25,000,000
December 31, 2002 25,000,000
June 30, 2003 25,000,000
December 31, 2003 25,000,000
June 30, 2004 50,000,000
(d) In the event that a Specified Change of Control Event
occurs, the Company shall repay all outstanding Term Loans and B Term Loans in
their entirety on the date which is the earlier of (i) 30 days after any date on
which such Specified Change of Control Event occurs and (ii) the date on which
any Senior Notes or any other Indebtedness of the Company or its Restricted
Subsidiaries are required to be repurchased, redeemed or prepaid as a result of
any such Specified Change of Control Event.
(e) The aggregate principal amount of Term Loans and B Term
Loans shall be repaid at the times, and in the amounts, provided in Section
3.03(e). The amount of each principal repayment of Term Loans or B Term Loans
pursuant to this Section 4.02(e) shall be applied to reduce each of the
remaining Scheduled TL Repayments or Scheduled BTL Repayments, as the case may
be, on a pro rata basis (based upon the then remaining amount of each such
Scheduled TL Repayment or Scheduled BTL Repayment, as the case may be).
(f) Notwithstanding anything to the contrary contained in this
Agreement, (i) all then outstanding Loans (other than B Term Loans) under this
Agreement shall be repaid in full on the Original Final Maturity Date, (ii) all
then outstanding Swingline Loans shall be repaid in full on the Swingline Expiry
Date and (iii) all then outstanding B Term Loans under this Agreement shall be
repaid in full on the Final Maturity Date.
(g) In addition to any other mandatory repayments pursuant to
this Section 4.02, the Company shall repay, on each date set forth below
(provided that if any date set forth below is not a Business Day then the
repayment shall occur on the first Business Day immediately succeeding such date
set forth below) (each a "Scheduled BTL Repayment Date"), the B Term Loans in an
amount equal to the amount set forth below opposite such date (each such
repayment, as the same may be reduced as provided in Sections 4.01, and 4.02(e),
a "Scheduled BTL Repayment"):
Scheduled BTL Repayment Date Amount
---------------------------- ------
June 30, 2000 $1,250,000
December 31, 2000 1,250,000
June 30, 2001 1,250,000
December 31, 2001 1,250,000
June 30, 2002 1,250,000
-26-
Scheduled BTL Repayment Date Amount
---------------------------- ------
December 31, 2002 1,250,000
June 30, 2003 1,250,000
December 31, 2003 1,250,000
July 31, 2004 240,000,000
(h) With respect to each repayment of Loans required by this
Section 4.02, the Company (or, in the case of Canadian Dollar Loans, the
Canadian Borrower or the Company on behalf of the Canadian Borrower) may
designate the Types of Loans which are to be repaid and the specific
Borrowing(s) pursuant to which made; provided that (i) Eurodollar Loans may be
designated for repayment pursuant to this Section 4.02 only on the last day of
an Interest Period applicable thereto unless all Eurodollar Loans under the
respective Tranche with Interest Periods ending on such date of required
repayment and all Base Rate Loans under the respective Tranche have been paid in
full; (ii) each repayment of any Loans made pursuant to a Borrowing shall be
applied pro rata among such Loans; (iii) notwithstanding the provisions of the
preceding clause (ii), no repayment of Tranche A Revolving Loans pursuant to
Section 4.02(a)(i) shall be applied to the Tranche A Revolving Loans of a
Defaulting Bank; and (iv) repayments of Tranche A Revolving Loans of Defaulting
Banks pursuant to Section 4.02(a)(ii) shall be applied pro rata among such
Tranche A Revolving Loans. In the absence of a designation by a Borrower as
described in the preceding sentence, the Administrative Agent shall, subject to
the above, make such designation in its sole discretion with a view, but no
obligation, to minimize breakage costs owing under Section 1.11. Notwithstanding
the foregoing provisions of this Section 4.02, if at any time the mandatory
repayment of Loans pursuant to Section 4.02(a) or (b) arising solely as a result
of a reduction to the Total Revolving Loan Commitment pursuant to Section
3.03(e) would result, after giving effect to the procedures set forth above in
this clause (h), in the Company (or, in the case of Canadian Dollar Loans, the
Canadian Borrower) incurring breakage costs under Section 1.11 as a result of
Eurodollar Loans being repaid other than on the last day of an Interest Period
applicable thereto (the "Affected Eurodollar Loans"), then the Company (or, in
the case of Canadian Dollar Loans, the Canadian Borrower or the Company on
behalf of the Canadian Borrower) may in its sole discretion initially deposit a
portion (up to 100%) of the amounts that otherwise would have been paid in
respect of the Affected Eurodollar Loans with the Administrative Agent to be
held as security for the obligations of the respective Borrower hereunder
pursuant to a cash collateral agreement to be entered into in form and substance
satisfactory to the Administrative Agent, with such cash collateral to be
released from such cash collateral account upon the first occurrence (or
occurrences) thereafter of the last day of an Interest Period applicable to the
relevant Loans that are Eurodollar Loans (or such earlier date or dates as shall
be requested by the respective Borrower), to repay an aggregate principal amount
of such Loans equal to the Affected Eurodollar Loans not initially repaid
pursuant to this sentence.
4.03 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement shall be made to
the Administrative Agent for the ratable account of the Banks entitled thereto
(based on each Bank's Pro Rata Share, if any), no later than 1:00 P.M. (New York
time) on the date when due and shall be made in immediately
-27-
available funds and in lawful money of the United States of America (or Canadian
Dollars in the case of Canadian Dollar Loans which have been assigned to the
other Banks by the Canadian Lender pursuant to Section 1.01(g)) at the Payment
Office, provided that payments in respect of Canadian Dollar Loans owing to the
Canadian Lender shall be made to the Canadian Lender no later than 1:00 P.M.
(New York time) on the date when due and shall be made in immediately available
funds and in lawful money of Canada at the Canadian Payment Office.
Notwithstanding anything to the contrary contained herein, any amounts owing or
payments required to be made by the Canadian Borrower hereunder, including,
without limitation, pursuant to Section 1.10, 1.11, 4.04 or 12.01, may, at the
option of the Company, be paid by the Company on behalf of the Canadian
Borrower. Any payments under this Agreement which are made later than 1:00 P.M.
(New York time) shall be deemed to have been made on the next succeeding
Business Day; provided, however, that to the extent that the Administrative
Agent shall have received any payment under this Agreement after 1:00 P.M. (New
York time) on a Business Day, the Administrative Agent shall use its best
efforts to distribute such payment as promptly as practicable on such date to
the Banks (other than any Bank that has consented in writing to waive its pro
rata share of such payment) pro rata based upon their respective shares, if any,
of the Obligations with respect to which such payment was received, and to the
extent that any such Bank receives its portion of such payment from the
Administrative Agent on such same date by a time satisfactory to such Bank, such
payment to such Bank shall be deemed to have been made on such date. Whenever
any payment to be made hereunder shall be stated to be due on a day which is not
a Business Day, the due date thereof shall be extended to the next succeeding
Business Day and, with respect to payments of principal, interest shall be
payable during such extension at the applicable rate in effect immediately prior
to such extension.
4.04 Net Payments. All payments made by each Borrower
hereunder will be made without setoff, counterclaim or other defense. Promptly
upon notice from any Bank to the respective Borrower, the Company (or, in the
case of Canadian Dollar Loans, each of the Company and the Canadian Borrower)
agrees to pay, prior to the date on which penalties attach thereto, all present
and future income, stamp and other taxes, levies, or costs and charges
whatsoever imposed, assessed, levied or collected on or in respect of any
Canadian Dollar Loan of any Type, or in respect of a Loan solely as a result of
the interest rate being determined by reference to the Eurodollar Rate, and/or
the provisions of this Agreement relating to the Eurodollar Rate, and/or the
recording, registration, notarization or other formalization of any thereof
and/or any payments of principal, interest or other amounts made on or in
respect of a Canadian Dollar Loan of any Type, or a Loan when the interest rate
is determined by reference to the Eurodollar Rate (all such taxes, levies, costs
and charges being herein collectively called "Taxes"); provided that Taxes shall
not include (x) taxes imposed on or measured by the overall net income or
receipts of the Administrative Agent or any Bank by the United States of America
or any political subdivision or taxing authority thereof or therein or (y) taxes
on or measured by the overall net income of any foreign office, branch or
subsidiary of the Administrative Agent or that Bank by any foreign country or
subdivision thereof in which the Administrative Agent's or that Bank's office,
branch or subsidiary is doing business. Each Borrower agrees to also pay such
additional amounts equal to increases in taxes payable by that Bank described in
the foregoing proviso which increases arise solely from the receipt by that Bank
of payments made by such Borrower described in the immediately preceding
sentence of this Section 4.04.
-28-
Promptly after the date on which payment of any such Tax is due pursuant to
applicable law, the respective Borrower will, at the request of that Bank,
furnish to that Bank evidence, in form and substance satisfactory to that Bank,
that the respective Borrower has met its obligation under this Section 4.04.
Each Borrower agrees to indemnify each Bank against, and reimburse each Bank on
demand for, any Taxes, as reasonably determined by that Bank in its good faith.
Such Bank shall provide the respective Borrower with appropriate receipts for
any payments or reimbursements made by such Borrower pursuant to this Section
4.04. Notwithstanding the foregoing, each Borrower shall be entitled, to the
extent it is required to do so by law, to deduct or withhold and pay to the
appropriate taxing authority within the time prescribed by applicable law (and
shall not be required to make payments as otherwise required in this Section on
account of such deductions or withholdings) income or other similar taxes
imposed by the United States of America from interest, fees or other amounts
payable hereunder for the account of the Administrative Agent or any Bank other
than the Administrative Agent or any Bank (i) who is a U.S. Person for Federal
income tax purposes or (ii) who has the Prescribed Forms on file with the
Company for the applicable year to the extent deduction or withholding of such
taxes is not required as a result of the filing of such Prescribed Forms,
provided that if a Borrower shall so deduct or withhold any such taxes, it shall
provide a statement to the Administrative Agent and such Bank, setting forth the
amount of such taxes so deducted or withheld, the applicable rate and any other
information or documentation which the Administrative Agent or such Bank may
reasonably request for assisting the Administrative Agent or such Bank to obtain
any allowable credits or deductions for the taxes so deducted or withheld in the
jurisdiction or jurisdictions in which the Administrative Agent or such Bank is
subject to tax. Notwithstanding anything to the contrary contained herein, the
Company shall compensate each Bank for all losses, expenses, liabilities, taxes
(including, without limitation, Taxes) or other costs which any such Bank may
incur or sustain as a result of the Company paying any obligations of the
Canadian Borrower hereunder or under any other Credit Document, which such Bank
would not otherwise incur or sustain if the Canadian Borrower had made any such
payments instead of the Company paying such amounts on behalf of the Canadian
Borrower.
SECTION 5. Conditions Precedent.
5.01 Conditions Precedent to the Restatement Effective Date.
The occurrence of the Restatement Effective Date pursuant to Section 12.10 and
the obligation of each Bank to make each Loan to the respective Borrower
hereunder (including, without limitation, the obligation of the Canadian Lender
to make each Canadian Dollar Loan hereunder), and the obligation of the Letter
of Credit Issuer to issue each Letter of Credit hereunder, are subject, on the
Restatement Effective Date, to the satisfaction of the following conditions:
(a) Execution of Agreement. This Agreement shall have been
executed and delivered in accordance with Section 12.10.
(b) No Default; Representations and Warranties. (i) There
shall exist no Default or Event of Default and (ii) all representations and
warranties contained herein or in the other Credit Documents in effect at such
time shall be true and correct in all material respects with the same effect as
though such representations and warranties had been made on and as of
-29-
such date, unless 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.
(c) Opinions of Counsel. The Administrative Agent shall have
received opinions, addressed to each of the Banks and dated the Restatement
Effective Date, (i) from Simpson, Thacher & ▇▇▇▇▇▇▇▇, special counsel to the
Credit Parties, which opinion shall cover the matters contained in Exhibit C-1
and such other matters incident to the transactions contemplated herein as the
Administrative Agent may reasonably request, (ii) from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.,
counsel to the Credit Parties, which opinion shall cover the matters contained
in Exhibit C-2 and such other matters incident to the transactions contemplated
herein as the Administrative Agent may reasonably request, and (iii) from White
& Case LLP, special counsel to the Administrative Agent, which opinion shall
cover the matters contained in Exhibit C-3.
(d) Corporate Proceedings. (i) The Administrative Agent shall
have received from each of the Company, the Canadian Borrower and each
Subsidiary Guarantor, a certificate, dated the Restatement Effective Date,
signed by the chairman, a vice chairman, the president, any vice-president or
the treasurer of such Person, and attested to by the secretary or any assistant
secretary of such Person, in the form of Exhibit D with appropriate insertions
and, to the extent required, together with copies of the Certificate of
Incorporation, By-Laws and the resolutions of such Person referred to in such
certificate, and the foregoing shall be satisfactory to the Administrative
Agent.
(ii) All corporate and legal proceedings and all instruments
and agreements in connection with the transactions contemplated by this
Agreement and the other Credit Documents shall be reasonably satisfactory in
form and substance to the Administrative Agent, and the Administrative Agent
shall have received all information and copies of all certificates, documents
and papers, including good standing certificates and any other records of
corporate proceedings and governmental approvals, if any, which the
Administrative Agent reasonably may have requested in connection therewith, such
documents and papers, where appropriate, to be certified by proper corporate or
governmental authorities.
(e) Guaranties. (i) Each Subsidiary Guarantor shall have duly
authorized, executed and delivered an amended and restated guaranty in the form
of Exhibit E-1 hereto (as amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof, the "Subsidiary Guaranty"), and
the Subsidiary Guaranty shall be in full force and effect.
(ii) The Company shall have duly authorized, executed and
delivered an amended and restated guaranty in the form of Exhibit E-2 hereto (as
amended, modified or supplemented from time to time in accordance with the terms
hereof and thereof, the "Company Guaranty"), and the Company Guaranty shall be
in full force and effect.
(f) Notice of Borrowing; Letter of Credit Request. The
Administrative Agent (and, in the case of any Borrowing of Canadian Dollar
Loans, the Canadian Lender) shall have received a Notice of Borrowing satisfying
the requirements of Section 1.03 with respect to any Borrowing of Loans on the
Restatement Effective Date; and the Administrative Agent and the Letter of
Credit Issuer shall have received a Letter of Credit Request satisfying the
requirements
-30-
of Section 2.03 with respect to the issuance of any Letter of Credit on the
Restatement Effective Date.
(g) Payment of Fees, etc. All costs, fees and expenses, and
all other compensation contemplated by this Agreement, due to the Administrative
Agent, the Letter of Credit Issuer or the Banks shall have been paid to the
extent due.
(h) Contribution Agreement. The Subsidiary Guarantors shall
have entered into an amended and restated contribution agreement in the form of
Exhibit F hereto (as amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof, the "Contribution Agreement"), and
the Contribution Agreement shall be in full force and effect.
(i) Existing Indebtedness Agreements. There shall have been
delivered to (or made available for review by) the Banks copies, certified (in
the case of those delivered) as true and correct by an appropriate officer of
the Company making such delivery, of all agreements evidencing or relating to
the Existing Debt or the Existing Contingent Obligations with respect to
Indebtedness for borrowed money (collectively, the "Existing Indebtedness
Agreements").
The occurrence of the Restatement Effective Date and the
acceptance of the benefits of any Credit Event on the Restatement Effective Date
shall constitute a representation and warranty by the Company to each of the
Banks that all of the conditions specified above exist as of the Restatement
Effective Date. All of the certificates, legal opinions and other documents and
papers referred to in this Section 5.01, unless otherwise specified, shall be
delivered to the Administrative Agent at its Notice Office for the account of
each of the Banks and in sufficient counterparts for each of the Banks and shall
be reasonably satisfactory in form and substance to the Administrative Agent.
5.02 Conditions Precedent to each Credit Event. The obligation
of each Bank to make each Loan to the respective Borrower hereunder (including,
without limitation, the obligation of the Canadian Lender to make each Canadian
Dollar Loan hereunder), and the obligation of the Letter of Credit Issuer to
issue each Letter of Credit hereunder, are subject, at the time of each such
Credit Event, to the satisfaction of the following conditions:
(a) No Default; Representations and Warranties. At the time of
each Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein or in the other Credit Documents in effect at such time shall
be true and correct in all material respects with the same effect as though such
representations and warranties had been made on and as of the date of such
Credit Event, unless 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.
(b) Notice of Borrowing; Letter of Credit Request. The
Administrative Agent (and, in the case of any Borrowing of Canadian Dollar
Loans, the Canadian Lender) shall have received a Notice of Borrowing satisfying
the requirements of Section 1.03 with respect to any Borrowing of Loans; and the
Administrative Agent and the Letter of Credit Issuer shall have
-31-
received a Letter of Credit Request satisfying the requirements of Section 2.03
with respect to the issuance of any Letter of Credit.
The acceptance of the benefits of each Credit Event shall
constitute a representation and warranty by the Company to each of the Banks
that all of the conditions specified above exist as of the date of such Credit
Event. All of the documents and papers referred to in this Section 5.02, unless
otherwise specified, shall be delivered to the Administrative Agent at its
Notice Office for the account of each of the Banks and in sufficient
counterparts for each of the Banks and shall be reasonably satisfactory in form
and substance to the Administrative Agent.
SECTION 6. Representations, Warranties and Agreements. In
order to induce the Banks to enter into this Agreement and to make the Loans and
issue and/or participate in the Letters of Credit provided for herein, the
Company makes the following representations and warranties to, and agreements
with, the Banks, all of which shall survive the execution and delivery of this
Agreement, the making of the Loans and the issuance of the Letters of Credit
(with the occurrence of each Credit Event on and after the Initial Borrowing
Date being deemed to constitute a representation and warranty that the matters
specified in this Section 6 are true and correct in all material respects on and
as of the Initial Borrowing Date and as of the date of each such Credit Event,
unless stated to relate to a specific earlier date):
6.01 Corporate Status. The Company and each of its Restricted
Subsidiaries (i) is a duly organized and validly existing corporation under the
laws of the jurisdiction of its organization and has the corporate power and
authority to own its property and assets and to transact the business in which
it is engaged and presently proposes to engage, (ii) is in good standing under
the laws of the jurisdiction of its organization and (iii) is duly qualified and
is authorized to do business and is in good standing in all jurisdictions where
it is required to be so qualified, except, in the cases of clauses (ii) and
(iii) above, for such failures to be in good standing and failures to be so
qualified which, in the aggregate, would not have a material adverse effect on
the condition (financial or otherwise), operations, assets, liabilities or
prospects of the Company and its Restricted Subsidiaries taken as a whole.
6.02 Corporate Power and Authority. Each of the Company and
each of its Restricted Subsidiaries has the corporate power and authority to
execute, deliver and carry out the terms and provisions of the Credit Documents
to which it is a party and has taken all necessary corporate action to authorize
the execution, delivery and performance of the Credit Documents to which it is a
party. Each of the Company and each of its Restricted Subsidiaries has duly
executed and delivered each Credit Document to which it is a party and each such
Credit Document constitutes the legal, valid and binding obligation of such
Person enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws generally affecting creditors' rights
and by equitable principles (regardless of whether enforcement is sought in
equity or at law).
-32-
6.03 No Violation. Neither the execution, delivery or
performance by the Company or any of its Restricted Subsidiaries of the Credit
Documents to which it is a party nor compliance by them with the terms and
provisions thereof, nor the consummation of the transactions contemplated
therein (i) will contravene in any material respect any applicable provision of
any law, statute, rule or regulation, or any order, writ, injunction or decree
of any court or governmental instrumentality, (ii) will conflict or be
inconsistent with or result in any breach of, any of the terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien upon
any of the property or assets of the Company or any of its Subsidiaries pursuant
to the terms of any indenture, mortgage, deed of trust, credit agreement, loan
agreement or other material agreement or instrument to which the Company or any
of its Subsidiaries is a party or by which any of them or any of their
respective property or assets is bound or to which it may be subject or (iii)
will violate any provision of the Certificate of Incorporation or By-Laws of the
Company or any of its Subsidiaries.
6.04 Litigation. There are no actions, suits or proceedings
pending, or, to the best knowledge of the Company, threatened, with respect to
the Company or any of its Subsidiaries (i) that are likely to have a material
adverse effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole or (ii) that could reasonably be expected to have a material adverse
effect on the rights or remedies of the Banks, the Letter of Credit Issuer or
the Administrative Agent or on the ability of the Company or of the Subsidiary
Guarantors, taken as a whole, in either case, to perform its or their respective
obligations hereunder and under the other Credit Documents to which it is or
they are, or will be, a party.
6.05 Use of Proceeds; Margin Regulations. (a) The proceeds of
all Terms Loans shall be utilized (i) to refinance the loans outstanding on the
Initial Borrowing Date under the Existing Credit Agreements, and (ii) to pay
certain fees and expenses arising in connection with such refinancing.
(b) The proceeds of all Revolving Loans, Swingline Loans and
Canadian Dollar Loans shall be used for the purposes referred to in Section
6.05(a) above and for general corporate and working capital purposes of the
Company and its Subsidiaries (including, without limitation, to finance
Permitted Acquisitions and refinance Senior Notes).
(c) The proceeds of all B Term Loans shall be used for the
general corporate and working capital purposes of the Company and its
Subsidiaries (including, without limitation, to finance Permitted Acquisitions
and refinance Senior Notes).
(d) Neither the making of any Loan hereunder, nor the use of
the proceeds thereof, will violate the provisions of Regulation T, U or X of the
Board of Governors of the Federal Reserve System and no part of the proceeds of
any Loan will be used to purchase or carry any Margin Stock or to extend credit
for the purpose of purchasing or carrying any Margin Stock, provided that the
Company may use the proceeds of Loans to purchase Margin Stock in compliance
with Regulations T, U and X, so long as at the time of the making of such Loan,
and
-33-
after giving effect thereto, not more than 25% of the value of the assets
subject to the provisions of Section 8 of the Company, or of the Company and its
Restricted Subsidiaries on a consolidated basis, shall constitute Margin Stock.
6.06 Governmental Approvals. No order, consent, approval,
license, authorization, or validation of, or filing, recording or registration
with, or exemption by, any foreign or domestic governmental or public body or
authority, or any subdivision thereof, is required to authorize or is required
in connection with (i) the execution, delivery and performance of any Credit
Document or (ii) the legality, validity, binding effect or enforceability of any
Credit Document, except those which have been obtained or made or those the
absence of which, individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on either (x) the condition
(financial or otherwise), operations, assets, liabilities or prospects of the
Company and its Restricted Subsidiaries taken as a whole or (y) the rights or
remedies of the Banks, the Letter of Credit Issuer or the Administrative Agent
or on the ability of the Company or of the Subsidiary Guarantors, taken as a
whole, in either case, to perform its or their respective obligations hereunder
and under the other Credit Documents to which it is or they are, or will be, a
party.
6.07 Investment Company Act. Neither the Company nor any of
its Restricted Subsidiaries is an "investment company" or a company "controlled"
by an "investment company," within the meaning of the Investment Company Act of
1940, as amended.
6.08 Public Utility Holding Company Act. Neither the Company
nor any of its Restricted Subsidiaries is a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding company" or of
a "subsidiary company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
6.09 True and Complete Disclosure. (a) All factual information
(taken as a whole) heretofore or contemporaneously furnished by the Company or
any of its Subsidiaries in writing to the Administrative Agent and/or any Bank
on or before the Restatement Effective Date (including, without limitation, (i)
the Information Memorandum and (ii) all information contained in the Credit
Documents) for purposes of or in connection with this Agreement or any
transaction contemplated herein is true and complete in all material respects on
the date as of which such information is dated or certified and not incomplete
by omitting to state any material fact necessary to make such information (taken
as a whole) not misleading at such time in light of the circumstances under
which such information was provided, it being understood and agreed that for
purposes of this Section 6.09(a), such factual information shall not include
projections and pro forma financial information.
(b) The projections and pro forma financial information
contained in the factual information referred to in paragraph (a) above were
based on good faith estimates and assumptions believed by such Persons to be
reasonable at the time made, it being recognized by the Banks that such
projections as to future events are not to be viewed as facts and that actual
results during the period or periods covered by any such projections may differ
from the projected results.
-34-
6.10 Financial Statements; Financial Condition. (a) The
consolidated balance sheets of the Company and its Subsidiaries as at December
31, 1997 and September 30, 1998 and the related consolidated statements of
income and cash flows of the Company and its Subsidiaries for the fiscal year or
nine-month period, as the case may be, ended as of said dates, which, in the
case of the December 31, 1997 statements, have been examined by Deloitte &
Touche, independent certified public accountants, who delivered an unqualified
opinion in respect thereof, present fairly the financial position of the Company
and its Subsidiaries at the dates of said statements and the results for the
period covered thereby. All such financial statements have been prepared in
accordance with GAAP consistently applied except to the extent provided in the
notes to said financial statements (subject, in the case of the September 30,
1998 statements, to normal year-end audit adjustments).
(b) Since December 31, 1997 and after giving effect to the
incurrence of Indebtedness hereunder and the other transactions contemplated
hereby, there has been no material adverse change in the condition (financial or
otherwise), operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole (other than any change in general
economic conditions or any change in conditions affecting the Business
generally).
6.11 Tax Returns and Payments. Each of the Company and each of
its Restricted Subsidiaries has filed all Federal income tax returns and all
other material tax returns, domestic and foreign, required to be filed by it and
has paid all Federal taxes and assessments shown to be due on such returns and
all other material taxes and assessments, domestic and foreign, in each case
payable by it which have become due, other than those not yet delinquent and
except for those contested in good faith and for which adequate reserves have
been provided in accordance with GAAP.
6.12 Compliance with ERISA. As of the Initial Borrowing Date,
there are no Plans and neither the Company nor any of its Restricted
Subsidiaries nor any ERISA Affiliate has incurred any unpaid material liability
or reasonably expects to incur any material liability with respect to any
"employee pension benefit plan" (as defined in Section 3(2) of ERISA) covered by
Title IV of ERISA. As of the date of each subsequent Credit Event, each Plan is
in substantial compliance with ERISA and the Code; no Reportable Event has
occurred with respect to a Plan; no Plan is insolvent or in reorganization; no
Plan has an accumulated or waived funding deficiency, has permitted decreases in
its funding standard account or has applied for an extension of any amortization
period within the meaning of Section 412 of the Code; neither the Company nor
any of its Restricted Subsidiaries nor any ERISA Affiliate has incurred or
reasonably expects to incur any liability to or on account of a Plan pursuant to
ERISA or the Code; no proceedings have been instituted by the PBGC to terminate
any Plan; no condition exists which presents a material risk to the Company, any
of its Restricted Subsidiaries or any ERISA Affiliate of incurring a liability
to or on account of a Plan pursuant to ERISA or the Code; no lien imposed under
the Code or ERISA on the assets of the Company, any of its Restricted
Subsidiaries or any ERISA Affiliate exists or is likely to arise on account of
any Plan; and the Company and its Restricted Subsidiaries do not maintain or
contribute to any "employee welfare benefit plan" (as defined in Section 3(1) of
ERISA), which provides benefits to retired
-35-
employees (other than as required by Section 601 of ERISA) where, with respect
to any of the foregoing representations in this Section 6.12, the liability for
or the lien which could arise as a result of, the particular circumstance or
event which is the subject of the representation, would be reasonably likely to
result in a material adverse effect on the condition (financial or otherwise),
operations, assets, liabilities or prospects of the Company and its Restricted
Subsidiaries taken as a whole. Using actuarial assumptions and computation
methods consistent with subpart 1 of subtitle E of Title IV of ERISA, the
aggregate liabilities of the Company, its Restricted Subsidiaries and ERISA
Affiliates to all Plans which are "multiemployer plans" (as defined in Section
4001(a)(3) of ERISA) (each a "Multiemployer Plan") in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
such Plan would not be reasonably likely to be an amount that could result in a
material adverse effect on the condition (financial or otherwise), operations,
assets, liabilities or prospects of the Company and its Restricted Subsidiaries
taken as a whole. Notwithstanding anything in this Section 6.12 to the contrary,
all representations and warranties made with respect to any Plan which is a
Multiemployer Plan shall be made to the best knowledge of the Company.
6.13 Subsidiaries. On the Restatement Effective Date, the
corporations listed on Annex III under the name of the Company are the only
Subsidiaries of the Company. Annex III correctly sets forth, as of the
Restatement Effective Date, the percentage ownership (direct and indirect) of
the Company in each class of capital stock of each of its Subsidiaries and also
identifies the direct owner thereof.
6.14 Intellectual Property. (a) The Company and each of its
Restricted Subsidiaries owns, or is licensed or otherwise authorized to sell,
distribute, use or exploit, all material copyrights, literary works, texts and
other works of authorship fixed in any tangible medium of expression necessary
for the present conduct of its business ("Copyrights"), except to the extent
that the failure to own or obtain licenses or authorizations with respect to any
of the foregoing, individually or in the aggregate, would not have a material
adverse effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole.
(b) The Company and each of its Restricted Subsidiaries owns
or is licensed to use all the patents, trademarks, permits, service marks, trade
names, technology, know-how and formulas, or rights with respect to the
foregoing, necessary for the present conduct of its business, except to the
extent that the failure to own or obtain licenses with respect to any of the
foregoing, individually or in the aggregate, would not have a material adverse
effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole (together with the Copyrights, "Intellectual Property").
(c) All Intellectual Property is protected in all material
respects under the laws of the United States relating to such Intellectual
Property and has been duly and properly registered or filed with or issued by
the appropriate governmental offices and jurisdictions for such registrations,
filings or issuances, except to the extent that the failure to make or obtain
such registrations, filings or issuances would not have a material adverse
effect on the condition
-36-
(financial or otherwise), operations, assets, liabilities or prospects of the
Company and its Restricted Subsidiaries taken as a whole.
(d) No material claim has been asserted by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property. The use of such
Intellectual Property by the Company or its Restricted Subsidiaries does not
infringe on the rights of any Person, except for such claims and infringements
as do not, individually or in the aggregate, give rise to any liabilities on the
part of the Company and its Restricted Subsidiaries that are material to the
Company and its Restricted Subsidiaries taken as a whole.
6.15 Compliance with Statutes, etc. The Company and each of
its Restricted Subsidiaries is in compliance with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including compliance with all
applicable Environmental Laws with respect to any Real Property and the
requirements of any permits issued under such Environmental Laws with respect to
any such Real Property or the operations of the Company or any of its
Subsidiaries), except such noncompliances as would not, in the aggregate, have a
material adverse effect on the condition (financial or otherwise), operations,
assets, liabilities or prospects of the Company and its Restricted Subsidiaries
taken as a whole.
SECTION 7. Affirmative Covenants. The Company hereby covenants
and agrees that on the Original Effective Date and thereafter for so long as
this Agreement is in effect and until the Commitments have terminated, no
Letters of Credit or Notes are outstanding and the Loans together with interest,
Fees and all other Obligations are paid in full:
7.01 Information Covenants. The Company will furnish to each
Bank:
(a) Annual Financial Statements. Within 100 days after the
close of each fiscal year of the Company, the consolidated balance sheets of
each of (A) the Company and its Subsidiaries and of (B) the Company and its
Restricted Subsidiaries, as at the end of such fiscal year and, in each case,
the related consolidated statements of income and retained earnings and of cash
flows for such fiscal year, setting forth for such fiscal year, in comparative
form, the corresponding figures for the preceding fiscal year and, in the case
of the figures with respect to the Company and its Restricted Subsidiaries the
corresponding figures from the budget for such fiscal year delivered pursuant to
Section 7.01(c); all of which shall be examined by Deloitte & Touche or such
other independent certified public accountants of recognized national standing
as shall be acceptable to the Administrative Agent, whose opinion shall not be
qualified as to the scope of audit or as to the status of the Company and its
Subsidiaries or of the Company and its Restricted Subsidiaries, as the case may
be, as a going concern, together with a certificate of such accounting firm
stating that in the course of its regular audit of the business of the Company
and its Subsidiaries, which audit was conducted in accordance with generally
accepted auditing standards, no Default or Event of Default which has occurred
and is continuing has come to its attention or, if such a Default or Event of
Default has come to its attention a statement as to the
-37-
nature thereof (provided that in no event shall such accountants be liable as a
result of this Agreement by reason of any failure to obtain knowledge of any
Default or Event of Default that would not be disclosed in the course of their
audit examination).
(b) Quarterly Financial Statements. As soon as available and
in any event within 50 days after the close of each of the first three quarterly
accounting periods in each fiscal year of the Company (beginning with the
quarterly accounting period ending June 30, 1996) and, at the sole option of the
Company, at any time prior to 100 days after the close of the fourth quarterly
accounting period in each fiscal year, the consolidated balance sheet of each of
(A) the Company and its Subsidiaries and of (B) the Company and its Restricted
Subsidiaries, as at the end of such quarterly period and the related
consolidated statements of income and retained earnings and of cash flows for
such quarterly period and for the elapsed portion of the fiscal year ended with
the last day of such quarterly period; all of which shall be in reasonable
detail and certified by the chief financial officer or other Authorized Officer
of the Company that they fairly present the financial condition of the Company
and its Subsidiaries or of the Company and its Restricted Subsidiaries, as the
case may be, as of the dates indicated and the results of their operations and
changes in their cash flows for the periods indicated, subject to changes
resulting from audit and normal year-end audit adjustments.
(c) Budgets; etc. Not more than 90 days after the commencement
of each fiscal year of the Company, budgets of the Company and its Restricted
Subsidiaries in reasonable detail for each of the four fiscal quarters of such
fiscal year setting forth Consolidated EBITDA and consolidated sales and setting
forth, with appropriate discussion, the principal assumptions upon which such
budgets are based.
(d) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Section 7.01(a) and (b), a certificate of
the chief financial officer, controller or chief accounting officer of the
Company (i) to the effect that no Default or Event of Default exists or, if any
Default or Event of Default does exist, specifying the nature and extent
thereof, which certificate shall set forth the calculations required to
establish whether the Company and its Subsidiaries were in compliance with the
provisions of Sections 8.04(c), 8.05(d), 8.07 and Sections 8.09 through and
including 8.11, as at the end of such fiscal quarter or year, as the case may be
and (ii) setting forth the calculations demonstrating (A) with respect to each
Affected Transaction consummated during the most recently ended fiscal quarter,
that the Company was in compliance, on a Pro Forma Basis, with Sections 8.09,
8.10 and 8.11 and (B) with respect to each business sold (or deemed sold)
pursuant to Section 8.02(c) hereof, compliance by the Company with clause (iii)
of such Section 8.02(c). In addition, at the time of the delivery of the
financial statements provided for in Section 7.01(a) and (b), a certificate of
the chief financial officer, controller or chief accounting officer of the
Company setting forth the amount of, and calculations required to establish the
amount of, Excess Cash Flow for the respective fiscal year or quarter.
(e) Notice of Default or Litigation. Promptly, and in any
event within three Business Days after any officer of the Company obtains
knowledge thereof, notice of (x) the occurrence of any event which constitutes a
Default or Event of Default, which notice shall
-38-
specify the nature thereof, the period of existence thereof and what action the
Company proposes to take with respect thereto and (y) the commencement of, or
threat of, or any significant development in, any litigation or governmental
proceeding pending against the Company or any of its Subsidiaries which is
likely to have a material adverse effect on the condition (financial or
otherwise), operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole, or the ability of the Company or of
the Subsidiary Guarantors, taken as a whole, in either case, to perform its or
their respective obligations hereunder or under any other Credit Document.
(f) Auditors' Reports. Promptly upon receipt thereof, a copy
of each report or "management letter" submitted to the Company or any of its
Subsidiaries by its independent accountants in connection with any annual,
interim or special audit made by them of the books of the Company or any of its
Subsidiaries.
(g) Other Information. Promptly upon transmission thereof,
copies of any filings and registrations with, and reports to, the SEC by the
Company or any of its Subsidiaries and, with reasonable promptness, such other
information or documents (financial or otherwise) as the Administrative Agent on
its own behalf or on behalf of the Required Banks may reasonably request from
time to time.
7.02 Books, Records and Inspections. The Company will, and
will cause each of its Restricted Subsidiaries to, permit, upon notice to the
chief financial officer or other Authorized Officer of the Company, officers and
designated representatives of the Administrative Agent or the Required Banks to
visit and inspect any of the properties or assets of the Company and any of its
Restricted Subsidiaries in whomsoever's possession, and to examine the books of
account of the Company and any of its Restricted Subsidiaries and discuss the
affairs, finances and accounts of the Company and of any of its Restricted
Subsidiaries with, and be advised as to the same by, their officers and
independent accountants, all at such reasonable times and intervals and to such
reasonable extent as the Administrative Agent or the Required Banks may desire.
7.03 Payment of Taxes. The Company will pay and discharge, and
will cause each of its Restricted Subsidiaries to pay and discharge, all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits, or upon any properties belonging to it, prior to the date on
which material penalties attach thereto, and all lawful claims for sums that
have become due and payable which, if unpaid, might become a Lien not otherwise
permitted under Section 8.03(a) or charge upon any properties of the Company or
any of its Restricted Subsidiaries; provided that neither the Company nor any of
its Restricted Subsidiaries shall be required to pay any such tax, assessment,
charge, levy or claim which is being contested in good faith and by proper
proceedings if it has maintained adequate reserves with respect thereto in
accordance with GAAP.
7.04 Corporate Franchises. The Company will do, and will cause
each of its Restricted Subsidiaries to do, or cause to be done, all things
necessary to preserve and keep in full force and effect its existence and its
rights, franchises, licenses, permits and Intellectual
-39-
Property rights except to the extent its failures to do so would not, in the
aggregate, have a material adverse effect on the condition (financial or
otherwise), operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole; provided, however, that any
transaction permitted by Section 8.02 will not constitute a breach of this
Section 7.04.
7.05 Compliance with Statutes, etc. The Company will, and will
cause each of its Restricted Subsidiaries to, comply with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including applicable statutes,
regulations, orders and restrictions relating to environmental standards and
controls) other than those the non-compliance with which would not have a
material adverse effect on the condition (financial or otherwise), operations,
assets, liabilities or prospects of the Company and its Restricted Subsidiaries
taken as a whole or on the ability of the Company or of the Subsidiary
Guarantors, taken as a whole, in either case, to perform its or their
obligations hereunder or under any other Credit Document.
7.06 ERISA. As soon as possible and, in any event, within 30
days after the Company, any of its Restricted Subsidiaries or any ERISA
Affiliate knows or could reasonably be expected to know of the occurrence of any
of the following and where it could reasonably be expected that a material
liability of the Company and its Restricted Subsidiaries and ERISA Affiliates,
taken as a whole, could result in connection therewith, the Company will deliver
to each of the Banks a certificate of the chief financial officer or other
Authorized Officer of the Company setting forth details as to such occurrence
and such action, if any, which the Company, such Restricted Subsidiary or such
ERISA Affiliate is required or proposes to take, together with any notices
required or proposed to be given to or filed with or by the Company, such
Restricted Subsidiary, such ERISA Affiliate, the PBGC, a Plan participant or the
Plan administrator with respect thereto: that a Reportable Event has occurred;
that an accumulated funding deficiency has been incurred or an application is
reasonably likely to be or has been made to the Secretary of the Treasury for a
waiver or modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code with respect to a Plan; that a Plan has been or is reasonably
likely to be terminated, reorganized, partitioned or declared insolvent under
Title IV of ERISA; that a Plan has an Unfunded Current Liability giving rise to
a lien under ERISA or the Code; that proceedings are reasonably likely to be or
have been instituted to terminate a Plan; that a proceeding has been instituted
pursuant to Section 515 of ERISA to collect a delinquent contribution to a Plan;
or that the Company, any of its Restricted Subsidiaries or any ERISA Affiliate
will or is reasonably likely to incur any liability (including any contingent or
secondary liability) to or on account of the termination of or withdrawal from a
Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409 or 502(i) or 502(1) of ERISA. At the request of any Bank, the
Company will deliver to such Bank a complete copy of the annual report (Form
5500) of each Plan required to be filed with the Internal Revenue Service.
7.07 End of Fiscal Years; Fiscal Quarters. The Company will,
for financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years to end on
-40-
December 31 of each year and (ii) each of its, and each of its Subsidiaries',
fiscal quarters to end on March 31, June 30, September 30 and December 31 of
each year.
7.08 Use of Proceeds. All proceeds of the Loans shall be used
as provided in Section 6.05.
7.09 Ownership of Subsidiaries. The Company will, at all
times, maintain, directly or indirectly, ownership of at least a majority of the
capital stock of its Restricted Subsidiaries, except to the extent 100% of the
capital stock owned by the Company or any Restricted Subsidiary of any such
Restricted Subsidiary is sold, transferred or disposed of in a transaction
permitted by Section 8.02(c) or (j) or any such Restricted Subsidiary is merged,
consolidated or liquidated in a transaction permitted by Section 8.02(e),
provided that the Company shall not be required to own a majority of the capital
stock of the Canadian Borrower so long as the Company continues to hold at least
as much of such capital stock as is held on the Original Effective Date.
7.10 Maintenance of Corporate Separateness. The Company will,
and will cause each of its Subsidiaries to, satisfy customary corporate
formalities, including the holding of regular board of directors' and
shareholders' meetings and the maintenance of corporate offices and records.
Neither the Company nor any Restricted Subsidiary shall make any payment to a
creditor of any Unrestricted Subsidiary in respect of any liability of such
Unrestricted Subsidiary, and no bank account of an Unrestricted Subsidiary shall
be commingled with any bank account of the Company or any of its Restricted
Subsidiaries. Any financial statements distributed to any creditors of an
Unrestricted Subsidiary shall clearly establish the separateness of such
Unrestricted Subsidiary from the Company and its Restricted Subsidiaries.
Finally, neither the Company nor any of its Subsidiaries shall take any action,
or conduct its affairs in a manner, which is likely to result in the corporate
existence of any Unrestricted Subsidiary which is a direct Subsidiary of the
Company or any Restricted Subsidiary being ignored by any court of competent
jurisdiction, or in the assets and liabilities of the Company or any Restricted
Subsidiary being substantively consolidated with those of any Unrestricted
Subsidiary in a bankruptcy, reorganization or other insolvency proceeding.
7.11 Canadian Borrower Capital Structure. The Company will, or
will cause K-III Directory Corporation, or any other domestic Wholly-Owned
Restricted Subsidiary of the Company to which all of the equity owned by the
Company or any of its Subsidiaries in the Canadian Borrower shall have been
transferred (such entity the "Replacement Canadian Parent"), to (i) continue to
be the owner of record of at least 25% of the issued and outstanding shares of
common stock of the Canadian Borrower, (ii) maintain in full force and effect
the Voting Trust Agreement, the Shareholders Agreement and the Canadian Borrower
Management Agreement, (iii) continue to own and hold the Convertible
Subordinated Debenture or to be the owner of record of all of the shares of
common stock of the Canadian Borrower issued upon the conversion thereof and
(iv) otherwise maintain the capital structure of the Canadian Borrower as is in
effect on the Original Effective Date.
-41-
SECTION 8. Negative Covenants. The Company hereby covenants
and agrees that as of the Original Effective Date, and thereafter for so long as
this Agreement is in effect and until the Commitments have terminated, no
Letters of Credit or Notes are outstanding and the Loans, together with
interest, Fees and all other Obligations are paid in full:
8.01 Changes in Business. The Company will not, and will not
permit any of its Restricted Subsidiaries to, engage in any businesses other
than Businesses, provided that the Company and its Restricted Subsidiaries may
engage in businesses other than a Business so long as the businesses engaged in
by the Company and its Restricted Subsidiaries, taken as a whole, consist
substantially of Businesses.
8.02 Consolidation, Merger, Sale or Purchase of Assets, etc.
The Company will not, and will not permit any of its Restricted Subsidiaries to,
wind up, liquidate or dissolve its affairs or enter into any transaction of
merger or consolidation, or convey, sell, lease or otherwise dispose of (or
agree to do any of the foregoing at any future time) all or any part of its
property or assets, or enter into any partnerships, joint ventures or
sale-leaseback transactions, or purchase or otherwise acquire (in one or a
series of related transactions) any part of the property or assets (other than
purchases or other acquisitions of inventory, materials and equipment (and, to
the extent consistent with industry practices, other tangible and intangible
assets) in the ordinary course of business) of any Person, except that the
following shall be permitted:
(a) any sale, transfer or other disposition of (x) inventory
in the ordinary course of business or (y) any other tangible or
intangible asset in the ordinary course of business of the Company
and/or its Restricted Subsidiaries;
(b) the advances, investments and loans permitted pursuant to
Section 8.05;
(c) Asset Sales constituting the disposition of a business
(including, without limitation, to the extent permitted in this Section
8.02(c), sales of the capital stock of a Restricted Subsidiary but
excluding sales of the stock of an Unrestricted Subsidiary); provided
that (i) no Default or Event of Default exists at such time or would
exist immediately after giving effect thereto; (ii) such sale, transfer
or disposition (or deemed sale, transfer or disposition pursuant to any
Permitted Restricted Subsidiary Conversion) (x) is for fair market
value, as determined in good faith by management of the Company (or, in
the case of any Permitted Restricted Subsidiary Conversion or Permitted
Restricted Asset Sale, to the extent requested by the Administrative
Agent or the Required Banks, as determined by a written opinion of
value reasonably satisfactory to the Administrative Agent by an
Appraisal Firm) and (y) except in the case of a Permitted Restricted
Subsidiary Conversion otherwise permitted pursuant to the terms hereof,
results in consideration in the form of cash, promissory notes issued
by the respective purchaser and/or other assets, provided that, to the
extent any such other assets are received by the Company and/or its
Restricted Subsidiaries in connection with any such Asset Sale, (I) the
market value of such other assets, when added to the aggregate amount
of other consideration received in connection with such Asset Sale,
shall equal or exceed the market value of the assets so sold (such
value to be set forth, to the extent requested by
-42-
the Administrative Agent or the Required Banks, in a written opinion of
value reasonably satisfactory to the Administrative Agent by an
Appraisal Firm) and (II) such assets are permitted to be acquired by
the Company or any of its Restricted Subsidiaries pursuant to Section
8.02(g) at the time of consummation of such Asset Sale (both before and
after giving effect to such Asset Sale); (iii) the businesses sold (or
deemed sold pursuant to any Permitted Restricted Subsidiary Conversion)
by the Company and/or its Restricted Subsidiaries pursuant to this
Section 8.02(c) in any fiscal year of the Company shall not, in the
aggregate, have EBITDA in the immediately preceding fiscal year in an
amount in excess of 25% of the Consolidated EBITDA of the Company and
its Restricted Subsidiaries for such preceding fiscal year, determined
on a pro forma basis as if (A) any dispositions (or deemed dispositions
pursuant to any Permitted Restricted Subsidiary Conversion) consummated
during such preceding fiscal year had been consummated on the first day
of such preceding fiscal year and (B) any acquisitions consummated
after the beginning of such preceding fiscal year but prior to the date
of any proposed Asset Sale pursuant to this Section 8.02(c) had been
consummated on the first day of such preceding fiscal year; and (iv) to
the extent such sale, transfer or disposition constitutes a sale,
transfer or disposition of less than 100% of the capital stock of any
Restricted Subsidiary of the Company, after giving effect to such sale,
transfer or disposition, the Company shall own at least a majority of
the capital stock of such Restricted Subsidiary;
(d) Asset Sales constituting the disposition of the capital
stock owned by the Company and its Restricted Subsidiaries or
Unrestricted Subsidiaries;
(e) any Restricted Subsidiary may be merged or consolidated
with or into, or be liquidated into, the Company or any other
Restricted Subsidiary of the Company, or all or any part of its
business, properties and assets may be conveyed, leased, sold or
otherwise transferred to the Company or any other Restricted
Subsidiary, provided that (v) in any such merger or consolidation
involving the Company, the Company shall be the surviving corporation,
(w) no Default or Event of Default exists or would exist after giving
effect thereto, (x) no Excluded Foreign Restricted Subsidiary or
Excluded Domestic Restricted Subsidiary may be the surviving
corporation of any such merger or consolidation (other than, in the
case of an Excluded Foreign Restricted Subsidiary, a merger or
consolidation with another Excluded Foreign Restricted Subsidiary and
other than, in the case of an Excluded Domestic Restricted Subsidiary,
a merger or consolidation with another Excluded Domestic Restricted
Subsidiary), (y) no businesses, properties or assets may be transferred
to Excluded Foreign Restricted Subsidiaries if after giving effect to
such transfer the Net Investments in Excluded Foreign Restricted
Subsidiaries would exceed $30,000,000 and (z) to the extent any
business, properties or assets are transferred to Excluded Domestic
Restricted Subsidiaries in connection with any such merger or
consolidation the Company shall have determined, with respect to such
transaction, that the Company and its Restricted Subsidiaries would
have been in compliance, on a Pro Forma Basis, with Sections 8.09, 8.10
and 8.11 of this Agreement;
-43-
(f) the Company and/or its Restricted Subsidiaries may lease
real or personal property (so long as such lease does not create
Capitalized Lease Obligations except as otherwise permitted by Section
8.04);
(g) so long as no Default or Event of Default exists or would
result therefrom, the Company and its Restricted Subsidiaries may
acquire assets, the capital stock of, or other ownership interests in,
any Person (any such acquisition permitted by this clause (g), a
"Permitted Acquisition"); provided that (A) after giving effect to any
such acquisition, the Company and its Restricted Subsidiaries shall be
in compliance with Section 8.01 hereof; (B) the Company shall have
determined, with respect to such acquisition, that, on a Pro Forma
Basis, the Company and its Restricted Subsidiaries would have been in
compliance with Sections 8.09, 8.10 and 8.11 of this Agreement; and (C)
to the extent that such acquisition is of the capital stock of or other
ownership interest in another Person (such Person, the "Acquired
Entity"), (I) such acquisition must be of at least a majority of such
capital stock or of such ownership interests, such Person shall
constitute a Restricted Subsidiary and all of the applicable provisions
of Section 8.14 shall have been complied with in respect of such
Restricted Subsidiary and (II) the Board of Directors or other
governing body of the Acquired Entity shall not have indicated, either
publicly or privately to the Company or any of its Restricted
Subsidiaries, its opposition to the consummation by the Company or such
Subsidiary of such acquisition;
(h) the Company and its Restricted Subsidiaries may sell or
discount, in each case without recourse, accounts receivable arising in
the ordinary course of business, but only in connection with the
compromise or collection thereof;
(i) Capital Expenditures by the Company and/or its Restricted
Subsidiaries made in the ordinary course of business; and
(j) the Company and its Restricted Subsidiaries may sell
assets (and may effect Permitted Restricted Subsidiary Conversions)
other than in the ordinary course of business, so long as (x) each such
asset is sold (or deemed sold pursuant to any Permitted Restricted
Subsidiary Conversion) at fair market value, as determined in good
faith by management of the Company; (y) each such sale (or deemed sale
pursuant to any Permitted Restricted Subsidiary Conversion) results in
consideration in the form of cash, promissory notes issued by the
respective purchaser and/or other assets, provided that, to the extent
any such other assets are received by the Company and/or its Restricted
Subsidiaries in connection with any such asset sale, (I) the market
value of such other assets, when added to the aggregate amount of other
consideration received in connection with such asset sale, shall equal
or exceed the market value of the assets so sold and (II) such assets
are permitted to be acquired by the Company or any of its Restricted
Subsidiaries pursuant to Section 8.02(g) at the time of consummation of
such asset sale (both before and after giving effect to such asset
sale); and (z) the aggregate value of all assets so sold (or deemed
sold pursuant to any Permitted Restricted Subsidiary Conversion) by the
Company and its Restricted Subsidiaries in any fiscal year shall not
exceed $25,000,000.
-44-
8.03 Liens. The Company will not, and will not permit any of
its Restricted Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon or with respect to any property or assets of any kind (real or
personal, tangible or intangible) of the Company or its Restricted Subsidiaries,
whether now owned or hereafter acquired, or sell any such property or assets
subject to an understanding or agreement, contingent or otherwise, to repurchase
such property or assets (including sales of accounts receivable or notes with
recourse to the Company or any of its Restricted Subsidiaries) or assign any
right to receive income, except:
(a) Liens for taxes not yet due or Liens for taxes being
contested in good faith and by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP;
(b) Liens in respect of property or assets of the Company or
any of its Restricted Subsidiaries imposed by law which were incurred
in the ordinary course of business and which have not arisen to secure
Indebtedness for borrowed money, such as carriers', warehousemen's and
mechanics' Liens, statutory landlord's Liens, and other similar Liens
arising in the ordinary course of business, and which either (x) do not
in the aggregate materially detract from the value of such property or
assets or materially impair the use thereof in the operation of the
business of the Company or its Restricted Subsidiaries or (y) are being
contested in good faith by appropriate proceedings, which proceedings
have the effect of preventing the forfeiture or sale of the property or
asset subject to such Lien;
(c) Liens in existence on the Original Effective Date which
are listed, and the property subject thereto described, in Annex IV,
without giving effect to any extensions or renewal thereof ("Permitted
Liens");
(d) Liens arising from judgments, decrees or attachments in
circumstances not constituting an Event of Default under Section 9.08;
(e) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, performance and return-of-money
bonds and other similar obligations incurred in the ordinary course of
business (exclusive of obligations in respect of the payment for
borrowed money);
(f) leases or subleases granted to third Persons not
interfering in any material respect with the business of the Company or
any of its Restricted Subsidiaries;
(g) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the ordinary conduct of the
business of the Company or any of its Restricted Subsidiaries;
-45-
(h) Liens arising from UCC financing statements regarding
leases permitted by this Agreement;
(i) purchase money Liens securing payables arising from the
purchase by the Company or any of its Restricted Subsidiaries of any
equipment or goods in the normal course of business, provided that such
payables shall not constitute Indebtedness;
(j) any interest or title of a lessor or sublessor under any
lease permitted by this Agreement;
(k) Liens created pursuant to Capital Leases permitted
pursuant to Section 8.04(c);
(l) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of custom duties in connection
with the importation of goods so long as such Liens attach only to the
imported goods;
(m) Liens on assets acquired (or owned by a Restricted
Subsidiary acquired) after the Original Effective Date securing
Indebtedness permitted under Section 8.04(g), provided that at the time
of such acquisition the value of the assets subject to such Liens does
not exceed 10% of the total value of the assets so acquired, or of the
assets of the Restricted Subsidiary so acquired, as the case may be;
(n) Liens arising out of consignment or similar arrangements
for the sale of goods entered into by the Company or any of its
Restricted Subsidiaries in the ordinary course of business;
(o) Liens created under this Agreement and/or the other Credit
Documents;
(p) Liens created under the Additional Credit Agreement, the
other Additional Facility Documents, the 1999 Additional Credit
Agreement and the other 1999 Additional Facility Documents; and
(q) Liens not otherwise permitted hereunder which secure
Indebtedness, Contingent Obligations or other obligations (in each case
permitted hereunder) not exceeding (as to the Company and its
Restricted Subsidiaries) $20,000,000 in the aggregate at any time
outstanding.
8.04 Indebtedness. The Company will not, and will not permit
any of its Restricted Subsidiaries to, contract, create, incur, assume or suffer
to exist any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the
other Credit Documents;
-46-
(b) (i) Indebtedness incurred pursuant to the Additional
Credit Agreement and the other Additional Facility Documents and (ii)
Indebtedness incurred pursuant to the 1999 Additional Credit Agreement
and the other 1999 Additional Facility Documents;
(c) Capitalized Lease Obligations of the Company and its
Restricted Subsidiaries; provided that the aggregate Capitalized Lease
Obligations under all Capital Leases outstanding at any one time shall
not exceed $50,000,000;
(d) Existing Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the Original Effective Date and listed on
Part A of Annex V hereto ("Existing Debt"), without giving effect to
any subsequent extension, renewal or refinancing thereof except
pursuant to Section 8.04(i);
(e) Indebtedness to the extent permitted pursuant to Section
8.05(c);
(f) Indebtedness evidenced by the Subordinated Exchange
Debentures after the issuance thereof in an aggregate principal amount
not to exceed $500,000,000 at any time outstanding;
(g) Indebtedness of a Restricted Subsidiary acquired after the
Original Effective Date (or Indebtedness assumed at the time of an
acquisition of an asset securing such Indebtedness), provided that (i)
such Indebtedness was not incurred in connection with or in
anticipation of such acquisition and (ii) at the time of such
acquisition such Indebtedness does not exceed 10% of the total value of
the assets of the Restricted Subsidiary so acquired, or of the asset so
acquired, as the case may be;
(h) additional Indebtedness of the Company and its Restricted
Subsidiaries not otherwise permitted hereunder; provided that (A) in no
event shall the final maturity of such Indebtedness occur prior to the
Final Maturity Date, (B) in no event shall such Indebtedness have a
shorter average life than the Loans hereunder, (C) in no event shall
such Indebtedness contain terms and conditions (including, without
limitation, with respect to the obligor and guarantors, if any, in
respect of such Indebtedness, prepayment and redemption provisions,
covenants, defaults, security, remedies and, if applicable,
subordination provisions) materially less favorable to the Company and
its Restricted Subsidiaries or to the Banks than the terms and
conditions of (I) in the case of Indebtedness issued to the public or
in accordance with Rule 144A or similar rule under the Securities Act
of 1933, as amended, the Senior Notes, (II) in the case of other senior
Indebtedness, this Agreement and the other Credit Documents, and (III)
in the case of other Indebtedness, similar Indebtedness of the Company
then outstanding or if no similar Indebtedness of the Company is then
outstanding, the Senior Notes (in each case excluding the impact of
market conditions on the interest rate and other economic terms) and
(D) the Company shall have determined, with respect to the incurrence
of such Indebtedness, that the Company and its Restricted Subsidiaries
would have been in compliance, on Pro Forma Basis, with Sections 8.09,
8.10 and 8.11 of this Agreement (any Indebtedness issued pursuant to
this Section 8.04(h), "Additional Indebtedness"), provided further,
that, the aggregate principal amount of any such Additional
-47-
Indebtedness incurred directly by the Subsidiary Guarantors (taken as a
whole), when added to the aggregate principal amount of Indebtedness
incurred directly by the Subsidiary Guarantors (taken as a whole)
pursuant to Section 8.04(j) shall not exceed $300,000,000 at any time
outstanding;
(i) Indebtedness of the Company and its Restricted
Subsidiaries constituting Permitted Refinancing Debt; and
(j) additional Indebtedness of the Company and its Restricted
Subsidiaries (including, but not limited to, Non-Facility Letter of
Credit Outstandings) not exceeding in an aggregate principal amount at
any one time outstanding an amount equal to $150,000,000, provided that
the aggregate principal amount of such Indebtedness incurred directly
by the Subsidiary Guarantors (taken as a whole), when added to the
aggregate principal amount of Additional Indebtedness incurred directly
by the Subsidiary Guarantors (taken as a whole) pursuant to Section
8.04(h), shall not exceed $300,000,000 at any time outstanding.
8.05 Advances, Investments and Loans. The Company will not,
and will not permit any of its Restricted Subsidiaries to, lend money or credit
or make advances to any Person, or purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to,
any Person, except:
(a) the Company and its Restricted Subsidiaries may invest in
cash and Cash Equivalents;
(b) the Company or any of its Restricted Subsidiaries may
acquire and hold receivables owing to it, if created or acquired in the
ordinary course of business and payable or dischargeable in accordance
with customary trade terms of the Company or such Restricted
Subsidiary, as the case may be;
(c) the Company may make intercompany loans and advances to
any Restricted Subsidiary, and any Restricted Subsidiary may make
intercompany loans and advances to any other Restricted Subsidiary or
the Company (collectively, "Intercompany Loans"), provided that (i) no
Intercompany Loan may be made to an Excluded Foreign Restricted
Subsidiary at any time if after giving effect to such Intercompany Loan
the Net Investments in Excluded Foreign Restricted Subsidiaries would
exceed $30,000,000, and (ii) no such Intercompany Loan may be made by
the Company or a Wholly-Owned Restricted Subsidiary to an Excluded
Domestic Restricted Subsidiary;
(d) so long as no Default or Event of Default exists or would
result therefrom, the Company and its Restricted Subsidiaries may make
loans and advances of cash to, or cash capital contributions in, any
Unrestricted Subsidiary of the Company; provided that (i) the sum of
(A) the aggregate amount of capital contributions made in, plus the
aggregate principal amount of loans or advances outstanding at any one
time made to, Unrestricted Subsidiaries after the Original Effective
Date pursuant to this clause (d) (such amount, the "Unrestricted
Subsidiary Investment Amount") plus (B) the Aggregate
-48-
Conversion Amount at such time, shall not exceed the Unrestricted
Subsidiary Investment Limit then in effect, and (ii) the Unrestricted
Subsidiary receiving cash proceeds from such loan, advance or
contribution shall utilize the entire amount of cash so received to
effectuate an acquisition of assets or capital stock of a Person not an
affiliate of the Company and its Subsidiaries (other than pursuant to a
Permitted Restricted Subsidiary Conversion or a Permitted Restricted
Asset Sale) or to develop the Business and to finance the working
capital needs of such Unrestricted Subsidiary;
(e) the Company and its Restricted Subsidiaries shall be
permitted to (i) make Permitted Acquisitions, (ii) engage in any
transaction to the extent permitted by Section 8.02(e) and (iii)
acquire and hold promissory notes issued by the purchasers of assets
sold in accordance with Section 8.02(c) or 8.02(j);
(f) the Company and any of its Restricted Subsidiaries may
acquire and own investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course
of business;
(g) the Company or any Subsidiary Guarantor may acquire
capital stock or other equity securities (or warrants, rights or
options with respect thereto) issued by any other Restricted
Subsidiary;
(h) Interest Rate Protection Agreements permitted by Section
8.06(e) shall be permitted;
(i) investments by the Company or Restricted Subsidiaries in
(x) Subsidiary Guarantors, provided that if the Subsidiary Guarantor in
which such investment is made is a newly-formed Subsidiary or a
Partially-Owned Restricted Subsidiary newly designated as a Subsidiary
Guarantor pursuant to Section 8.14(b)(x), all of the applicable
provisions of Section 8.14 shall have been satisfied with respect to
such Restricted Subsidiary, (y) Excluded Domestic Restricted
Subsidiaries, provided that, the Company shall have determined, in
connection with any such investment, that the Company and its
Restricted Subsidiaries would have been in compliance, on a Pro Forma
Basis, with Sections 8.09, 8.10 and 8.11 of this Agreement and (z) in
Excluded Foreign Restricted Subsidiaries, provided that no investment
in an Excluded Foreign Restricted Subsidiary may be made at any time if
after giving effect to such investment the Net Investments in Excluded
Foreign Restricted Subsidiaries would exceed $30,000,000;
(j) the Company and its Restricted Subsidiaries may make loans
and advances to officers, employees and agents in the ordinary course
of business (i) constituting travel advances or (ii) otherwise equal in
the aggregate for the Company and its Restricted Subsidiaries, in the
case of all loans and advances pursuant to this clause (ii), to no more
than $10,000,000 at any one time outstanding less the principal amount
of all Contingent Obligations then outstanding pursuant to Section
8.06(i);
-49-
(k) the Company may acquire obligations of, or make loans or
advances to, one or more management investors in connection with such
management investors' acquisition of shares of capital stock of the
Company, provided that (x) the aggregate amount of cash actually
advanced to all such management investors by the Company and its
Restricted Subsidiaries shall not exceed $10,000,000 at any time, and
(y) the aggregate principal amount of all such obligations, loans and
advances shall not exceed $25,000,000 at any one time outstanding; and
(l) advances, investments and loans not otherwise permitted
hereunder with an aggregate cost or principal amount, as the case may
be, not to exceed $25,000,000 at any time outstanding.
8.06 Contingent Obligations. The Company will not, and will
not permit any of its Restricted Subsidiaries to, contract, create, incur,
assume or suffer to exist any Contingent Obligations, except:
(a) any Subsidiary Guarantor may become liable as guarantor
with respect to any Indebtedness, obligation or liability of the
Company or any other Subsidiary Guarantor to the extent that such
Indebtedness, obligation or liability is otherwise permitted by this
Agreement, provided that a Subsidiary Guarantor (x) may not guaranty
any Subordinated Exchange Debentures and (y) may only guaranty
Permitted Refinancing Debt if and to the extent either (A) it
guarantied the indebtedness refinanced thereby or (B) such Subsidiary
Guarantor would have guarantied the indebtedness refinanced thereby if
it had been a Subsidiary of the Company while such indebtedness was
outstanding;
(b) Contingent Obligations pursuant to the Guaranties;
(c) Contingent Obligations pursuant to the Additional Facility
Documents and the 1999 Additional Facility Documents;
(d) Contingent Obligations in respect of the Letters of
Credit;
(e) Contingent Obligations under Interest Rate Protection
Agreements with respect to the Loans, loans incurred under the
Additional Credit Agreement or any other floating rate Indebtedness of
the Company and its Restricted Subsidiaries otherwise permitted by this
Agreement;
(f) Contingent Obligations pursuant to the Contribution
Agreement;
(g) Contingent Obligations of the Company outstanding on the
Original Effective Date and listed on Part B of Annex V hereto
("Existing Contingent Obligations"), without giving effect to any
subsequent extension, renewal or refinancing thereof;
-50-
(h) the Company may become liable as guarantor with respect to
any Indebtedness, obligation or liability of any Subsidiary Guarantor
to the extent that such Indebtedness, obligation or liability is
otherwise permitted by this Agreement;
(i) the Company and its Restricted Subsidiaries may guaranty
in the ordinary course of business loans and advances to officers,
employees and agents so long as the aggregate principal amount of the
loans and advances so guaranteed does not exceed $10,000,000 less the
principal amount of all loans and advances outstanding pursuant to
Section 8.05(j); and
(j) additional Contingent Obligations (including, without
limitation, Contingent Obligations consisting of Non-Facility Letters
of Credit and reimbursement obligations with respect thereto) not
otherwise permitted hereunder not exceeding (for the Company and all of
its Restricted Subsidiaries) in aggregate principal amount at any time
outstanding an amount equal to the lesser of (x) $30,000,000 and (y)
when added to the aggregate principal amount of Indebtedness
outstanding under Section 8.04(j) at such time, $150,000,000.
8.07 Dividends, etc. The Company will not, and will not permit
any of its Restricted Subsidiaries to, declare or pay any dividends (other than
dividends payable solely in capital stock of such Person) or return any capital
to, its stockholders or authorize or make any other distribution, payment or
delivery of property or cash to its stockholders as such, or redeem, retire,
purchase or otherwise acquire, directly or indirectly, for a consideration, any
shares of any class of its capital stock now or hereafter outstanding (or any
warrants for or options or stock appreciation rights in respect of any of such
shares), or set aside any funds for any of the foregoing purposes, and the
Company will not permit any of its Restricted Subsidiaries to purchase or
otherwise acquire for consideration any shares of any class of the capital stock
of the Company or any other Subsidiary, as the case may be, now or hereafter
outstanding (or any options or warrants or stock appreciation rights issued by
such Person with respect to its capital stock) (all of the foregoing
"Dividends"), except that:
(a) the Company may pay regularly accruing dividends on each
issuance of Preferred Stock through the issuance of additional shares
of such Preferred Stock, provided that the Company may pay such
regularly accruing dividends on its Preferred Stock in cash so long as
no Default or Event of Default exists at such time or would result
therefrom;
(b) any Subsidiary of the Company may pay Dividends to the
Company or to any Wholly-Owned Restricted Subsidiary of the Company;
(c) any Partially-Owned Restricted Subsidiary may pay cash
Dividends to its stockholders, provided that the Company and its
Restricted Subsidiaries must receive at least their proportionate share
of any Dividends paid by such Subsidiary;
(d) so long as no Default or Event of Default exists at such
time or would result therefrom (x) the Company may issue its
Subordinated Exchange Debentures in
-51-
exchange for its Senior Preferred Stock in accordance with the terms
thereof, (y) the Company may issue its Subordinated Exchange Debentures
in exchange for its Series B Preferred Stock in accordance with the
terms thereof and (z) the Company may issue its Subordinated Exchange
Debentures in exchange for its Series C Preferred Stock in accordance
with the terms thereof, provided that in each such case, the Company
shall have determined, with respect to such issuance, that the Company
and its Restricted Subsidiaries would have been in compliance, on a Pro
Forma Basis, with Sections 8.09, 8.10 and 8.11 of this Agreement;
(e) the Company may exchange shares of its common stock in
replacement for shares of outstanding Preferred Stock;
(f) the Company may issue Permitted Replacement Preferred
Stock so long as either (x) such stock is issued in exchange for or (y)
all of the proceeds from such issuance are used to redeem or
repurchase, shares of outstanding Preferred Stock;
(g) the Company may redeem or repurchase shares of its common
stock from management investors; provided that (x) no Default or Event
of Default is then in existence or would arise therefrom and (y) the
aggregate amount of all cash paid in respect of all such shares and
equity interests so redeemed or repurchased does not exceed the sum of
(i) $5,000,000 in any fiscal year or $15,000,000 in the aggregate after
the Original Effective Date and (ii) the amount of cash proceeds
received by the Company in respect of the issuance of common equity to
management investors on or after the Original Effective Date;
(h) the Company and its Subsidiaries may enter into
transactions permitted under Section 8.05(g);
(i) the Company and its Restricted Subsidiaries may acquire
the capital stock of Unrestricted Subsidiaries in accordance with the
provisions of this Agreement;
(j) so long as no Default or Event of Default exists at such
time or would result therefrom, the Company may redeem or repurchase
shares of its Preferred Stock at a price equal to the liquidation
preference thereof plus accrued but unpaid dividends thereon and any
applicable premium with respect thereto in exchange for, or with the
proceeds of, Additional Preferred Stock and/or Indebtedness incurred
under Sections 8.04(h) and/or 8.04(j) (it being understood and agreed
that such redemption and/or repurchase need not occur contemporaneously
with the issuance of such Additional Preferred Stock or Indebtedness);
(k) so long as no Default or Event of Default exists at such
time or would result therefrom, the Company may declare and pay cash
Dividends to the holders of its common stock (including, without
limitation, repurchases of shares of its common stock), provided that
(x) the aggregate amount of cash Dividends paid pursuant to this clause
(k) during any fiscal year of the Company does not exceed $25,000,000
and (y) the Company shall have determined, in connection with such
Dividend, that the Company and its
-52-
Restricted Subsidiaries would have been in compliance, on a Pro Forma
Basis, with Sections 8.09, 8.10 and 8.11 of this Agreement; and
(l) the Company may pay additional cash Dividends to the
holders of its common stock so long as (x) no Default or Event of
Default exists at such time or would result therefrom, (y) the Leverage
Ratio at such time is less than 4.00:1.00 and (z) the Company shall
have determined, in connection with such Dividend, that the Company and
its Restricted Subsidiaries would have been in compliance, on a Pro
Forma Basis, with Sections 8.09, 8.10 and 8.11 of this Agreement.
8.08 Transactions with Affiliates. The Company will not, and
will not permit any of its Restricted Subsidiaries to, enter into any
transaction or series of transactions, whether or not in the ordinary course of
business, with any Affiliate (other than the Company or any Restricted
Subsidiary) other than on terms and conditions substantially as favorable to the
Company or such Restricted Subsidiary as would be obtainable by the Company or
such Restricted Subsidiary at the time in a comparable arm's-length transaction
with a Person other than an Affiliate; provided that (i) the Company may pay
management and transaction fees to KKR or its affiliates which have been
disclosed in writing to the Banks prior to the Original Effective Date; (ii) the
payment of transaction fees to KKR for the rendering of financial advice and
services in connection with acquisitions, dispositions and financings by the
Company and its Restricted Subsidiaries in amounts which are in accordance with
past practices shall be permitted; (iii) loans and advances to officers,
employees and agents in the ordinary course of business shall be permitted; (iv)
customary fees may be paid to non-officer directors of the Company and/or its
Restricted Subsidiaries; (v) the loans, advances and contributions made (or
deemed made) in Unrestricted Subsidiaries in compliance with Section 8.05(d)
shall be permitted; and (vi) transactions specifically permitted by the
provisions of this Agreement to occur between the Company, its Restricted
Subsidiaries and their respective Affiliates shall be permitted to the extent so
otherwise specifically permitted.
8.09 Fixed Charge Coverage Ratio. The Company will not permit
the ratio of (i) Consolidated EBITDA of the Company and its Restricted
Subsidiaries to (ii) Consolidated Fixed Charges of the Company and its
Restricted Subsidiaries, for any Test Period, to be less than 1.05 to 1.0.
8.10 Interest Coverage Ratio. The Company will not permit the
ratio of (i) Consolidated EBITDA of the Company and its Restricted Subsidiaries
to (ii) Consolidated Interest Expense of the Company and its Restricted
Subsidiaries for any Test Period ending during a period listed below to be less
than the ratio set forth opposite such period below:
Period Ratio
------ -----
Original Effective Date to and including 1.80 to 1.00
December 31, 1999
January 1, 2000 to and including 2.00 to 1.00
-53-
Period Ratio
------ -----
December 31, 2000
January 1, 2001 to and including 2.25 to 1.00
December 31, 2001
January 1, 2002 and thereafter 2.50 to 1.00
8.11 Leverage Ratio. The Company will not permit the ratio
(the "Leverage Ratio") of (i) Consolidated Debt of the Company and its
Restricted Subsidiaries at any date of determination thereof to (ii)
Consolidated EBITDA of the Company and its Restricted Subsidiaries for the Test
Period then last ended, to exceed, at any time during a period set forth below,
the ratio set forth opposite such period below:
Period Ratio
------ -----
Original Effective Date to and including 6.00 to 1.00
December 31, 1999
January 1, 2000 to and including 5.50 to 1.00
December 31, 2000
January 1, 2001 to and including 5.00 to 1.00
December 31, 2001
January 1, 2002 and thereafter 4.50 to 1.00
8.12 Issuance of Stock. The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, issue,
sell, assign, pledge or otherwise encumber or dispose of any shares of its or
such Restricted Subsidiary's preferred or preference stock or other redeemable
equity securities (or warrants, rights or options to acquire shares of any of
the foregoing) except:
(a) in the case of shares of capital stock of the Company and
its Restricted Subsidiaries, to the extent permitted by Section 8.02,
8.03, 8.05, 8.07 or 8.13(b);
(b) issuances by Restricted Subsidiaries to the Company or to
Wholly-Owned Restricted Subsidiaries; and
(c) issuances by the Company of additional preferred stock not
otherwise permitted hereunder; provided that (A) in no event shall such
preferred stock contain any provision requiring mandatory redemption or
permitting any put with respect to all or any
-54-
portion of such stock prior to the Final Maturity Date, (B) in no event
shall such preferred stock contain terms and conditions (including,
without limitation, pay-in-kind features, liquidation preferences,
voting rights and exchange rights) materially less favorable to the
Company and its Restricted Subsidiaries or to the Banks than the terms
and conditions of the Existing Preferred Stock (excluding the impact of
market conditions on the dividend rate and other economic terms) and
(C) the Company shall have determined, in connection with such
issuance, that the Company and its Restricted Subsidiaries would have
been in compliance, on a Pro Forma Basis, with Sections 8.09, 8.10 and
8.11 of this Agreement, provided that, for purposes of the calculation
of compliance with Section 8.09, the ratio set forth in Section 8.09
shall be deemed to equal 1.25 to 1.0 (any Preferred Stock issued
pursuant to this Section 8.12(c), "Additional Preferred Stock").
8.13 Modifications of Certain Agreements, etc. The Company
will not, and will not permit any of its Subsidiaries to: (a) after the issuance
thereof, amend or modify (or permit the amendment or modification of) any of the
terms or provisions of the Senior Notes, the Additional Facility Documents, the
1999 Additional Facility Documents, the Preferred Stock, the Subordinated
Exchange Debentures, any Additional Indebtedness, any Permitted Refinancing
Debt, the Convertible Subordinated Debenture, the Canadian Borrower Management
Agreement, the Voting Trust Agreement, the Shareholders Agreement, or any
agreement related to any of the foregoing, provided that (i) Permitted
Amendments may be made to the Senior Notes, the Additional Facility Documents,
the 1999 Additional Facility Documents, the Preferred Stock, any Permitted
Refinancing Debt, any Additional Indebtedness, any Subordinated Exchange
Debenture, and the documents governing the terms of any of the foregoing and
(ii) amendments or modifications may be made to the Canadian Borrower Management
Agreement which, in the aggregate or individually, would not adversely affect
the interests of any Bank under this Agreement or the other Credit Documents (it
being understood and agreed that the annual fee payable to K-III Directory
Corporation or the Replacement Canadian Parent, if any, pursuant thereto may be
amended or modified); or (b) make (or give any notice in respect thereof) any
voluntary or optional payment or prepayment or redemption or acquisition for
value of (including, without limitation, by way of depositing with the trustee
with respect thereto money or securities before due for the purpose of paying
when due) or exchange of any Subordinated Exchange Debentures, or any Permitted
Refinancing Debt (to the extent issued to refinance Subordinated Exchange
Debentures), provided that the Subordinated Exchange Debentures and any
Permitted Refinancing Debt previously issued to refinance same may be (i)
refinanced with (A) Additional Indebtedness (to the extent that such Additional
Indebtedness would have qualified as Permitted Refinancing Debt in respect
thereof if it had been issued contemporaneously with such refinancing) and/or
Permitted Refinancing Debt or (B) the proceeds from a common equity issuance by
the Company or an issuance by the Company of Additional Preferred Stock, in each
case, after the Original Effective Date or (ii) exchanged for Additional
Preferred Stock or non-redeemable common equity of the Company (it being
understood and agreed that any refinancing of such Indebtedness need not occur
contemporaneously with the issuance of such Additional Indebtedness, Additional
Preferred Stock and/or common equity). In addition, the Company will not, and
will not permit any of its Restricted Subsidiaries to, agree to modify,
supplement, amend, rescind or otherwise alter the terms, conditions or
provisions of its Certificate of Incorporation (including, without limitation,
-55-
by the filing of any certificate of designation) or its By-Laws in any material
respect, other than such modifications, supplements or amendments that would not
materially adversely affect the interests of the Banks under this Agreement or
the other Credit Documents.
8.14 Limitation on the Creation of Subsidiaries; Redesignation
of Partially-Owned Restricted Subsidiaries. (a) Notwithstanding anything to the
contrary contained in this Agreement, the Company shall not, and shall not
permit any Subsidiary to, establish, create or acquire after the Original
Effective Date any Subsidiary unless (w) such Subsidiary is an Unrestricted
Subsidiary; (x) such Subsidiary is an Excluded Foreign Restricted Subsidiary;
(y) such Subsidiary is a Partially-Owned Restricted Subsidiary and at the time
of creation or acquisition thereof, the Company shall have made a Non-Guarantor
Designation with respect to such Partially-Owned Restricted Subsidiary in
accordance with the terms hereof or (z) such Subsidiary is a Restricted
Subsidiary (other than a Restricted Subsidiary of the type described in clauses
(x) or (y) above) and each such new Restricted Subsidiary becomes a party to the
Subsidiary Guaranty by executing a Subsidiary Assumption Agreement in the form
of Exhibit H hereto.
(b) At any time and from time to time, (x) the Company may
redesignate any Excluded Domestic Restricted Subsidiary as a Subsidiary
Guarantor by giving notice thereof to the Administrative Agent and by causing
such Subsidiary to become a party to the Subsidiary Guaranty by executing a
Subsidiary Assumption Agreement in the form of Exhibit H hereto, and (y) the
Company may redesignate any Subsidiary Guarantor which is a Partially-Owned
Restricted Subsidiary as an Excluded Domestic Restricted Subsidiary by making a
Non-Guarantor Designation with respect to such Subsidiary in accordance with the
terms hereof.
(c) At the time of the creation of any Subsidiary described in
clause (z) of Section 8.14(a) and at the time of any redesignation pursuant to
clause (x) of Section 8.14(b), each such new Subsidiary Guarantor shall execute
and deliver, or cause to be executed and delivered, in each case to the extent
not previously executed and delivered, all other relevant documentation of the
type described in Section 5 as such new Subsidiary Guarantor would have had to
deliver if such new Restricted Subsidiary had been a Restricted Subsidiary and a
Subsidiary Guarantor on the Initial Borrowing Date.
(d) Notwithstanding anything to the contrary contained in this
Section 8.14 or elsewhere in this Agreement, in no event shall any Subsidiary of
the Company guaranty any Indebtedness of the Company or any Wholly-Owned
Subsidiary unless such Subsidiary is a party to the Subsidiary Guaranty;
provided that, to the extent not prohibited by Section 8.04 hereof, (x) Excluded
Foreign Restricted Subsidiaries may guaranty Indebtedness of other Excluded
Foreign Restricted Subsidiaries and (y) Unrestricted Subsidiaries may guaranty
Indebtedness of other Unrestricted Subsidiaries.
8.15 Limitation on Payments Under the Non-Compete Notes. The
Company will not, and will not permit any of its Subsidiaries to, make any
payment representing the principal of, or interest on, any Non-Compete Note at
any time when any Default or Event of Default exists or would exist immediately
after giving effect to such payment.
-56-
SECTION 9. Events of Default. Upon the occurrence of any of
the following specified events (each an "Event of Default"):
9.01 Payments. (a) Either Borrower shall (i) default in the
payment when due of any principal of the Loans or (ii) default, and such default
shall continue for five or more days, in the payment when due of any Unpaid
Drawing, any interest on the Loans or any Fees or any other amounts owing
hereunder or under any other Credit Document or (b) any Guarantor shall default
in the payment when due of any amount in respect of any payment of the type
described in clause (a)(ii) above pursuant to its Guaranty, and such default
shall continue for five or more days; or
9.02 Representations, etc. Any representation, warranty or
statement made by either Borrower or any Subsidiary Guarantor herein or in any
other Credit Document or in any statement or certificate delivered pursuant
hereto or thereto shall prove to be untrue in any material respect on the date
as of which made or deemed made; or
9.03 Covenants. The Company shall (a) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 7.08, 7.11(i), (iii) or (iv) or 8, or (b) default in the due performance
or observance by it of any term, covenant or agreement (other than those
referred to in Section 9.01, 9.02 or clause (a) of this Section 9.03) contained
in this Agreement and such default shall continue unremedied for a period of at
least 30 days after notice to the defaulting party by the Administrative Agent
or the Required Banks; or
9.04 Default Under Other Agreements. (a) The Company or any of
its Restricted Subsidiaries shall (i) default in any payment with respect to any
Indebtedness or Contingent Obligation (other than the Obligations) beyond the
period of grace, if any, provided in the instrument or agreement under which
such Indebtedness or Contingent Obligation was created or (ii) default in the
observance or performance of any agreement or condition relating to any such
Indebtedness or Contingent Obligation 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 holders of such Indebtedness
or Contingent Obligation (or a trustee or agent on behalf of such holder or
holders) to cause any such Indebtedness or Contingent Obligation to become due
prior to its stated maturity; or (b) any Indebtedness or Contingent Obligation
(other than the Obligations) of the Company or any of its Restricted
Subsidiaries shall be declared to be due and payable, or shall be required to be
prepaid other than by a regularly scheduled required prepayment or as a
mandatory prepayment (unless such required prepayment or mandatory prepayment
results from a default thereunder or an event of the type that constitutes an
Event of Default), prior to the stated maturity thereof, provided that it shall
not constitute an Event of Default pursuant to clause (a) or (b) of this Section
9.04 unless the principal amount of any one issue of such Indebtedness or
Contingent Obligation exceeds $7,500,000 or the aggregate amount of all such
Indebtedness and Contingent Obligations referred to in clauses (a) and (b) above
exceeds $15,000,000 at any one time; or
-57-
9.05 Bankruptcy, etc. The Company or any of its Restricted
Subsidiaries shall commence a voluntary case concerning itself under Title 11 of
the United States Code entitled "Bankruptcy," as now or hereafter in effect, or
any successor thereto (the "Bankruptcy Code"); or an involuntary case is
commenced against the Company or any of its Restricted Subsidiaries and the
petition is not controverted within 10 days, or is not dismissed within 60 days,
after commencement of the case; or a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of the Company or any of its Restricted Subsidiaries; or the Company or
any of its Restricted Subsidiaries commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or
hereafter in effect relating to the Company or any of its Restricted
Subsidiaries; or there is commenced against the Company or any of its Restricted
Subsidiaries any such proceeding which remains undismissed for a period of 60
days; or the Company or any of its Restricted Subsidiaries is adjudicated
insolvent or bankrupt; or any order of relief or other order approving any such
case or proceeding is entered; or the Company or any of its Restricted
Subsidiaries suffers any appointment of any custodian or the like for it or any
substantial part of its property to continue undischarged or unstayed for a
period of 60 days; or the Company or any of its Restricted Subsidiaries makes a
general assignment for the benefit of creditors; or any corporate action is
taken by the Company or any of its Restricted Subsidiaries for the purpose of
effecting any of the foregoing; or
9.06 ERISA. (a) Any Plan shall fail to satisfy the minimum
funding standard required for any plan year or part thereof or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code; any Plan is, shall have been or is likely to be
terminated or the subject of termination proceedings under ERISA; any Plan shall
have an Unfunded Current Liability; or the Company, any Restricted Subsidiary or
any ERISA Affiliate has incurred or is likely to incur a liability to or on
account of a Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971, 4975 or 4980 of
the Code; or the Company or any Restricted Subsidiary has incurred or is likely
to incur liabilities pursuant to one or more employee welfare benefit plans (as
defined in Section 3(1) of ERISA) which provide benefits to retired employees
(other than as required by Section 601 of ERISA); and (b) there shall result
from any such event or events the imposition of a lien, the granting of a
security interest, or a liability or a material risk of incurring a liability,
on the part of the Company, any of its Restricted Subsidiaries or any ERISA
Affiliate, which lien, security interest or liability will have a material
adverse effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole; or
9.07 Guaranty. (a) Any Guaranty or any provision thereof shall
cease to be in full force and effect, or any Guarantor thereunder or any Person
acting on behalf of such Guarantor shall deny or disaffirm such Guarantor's
obligations under such Guaranty or (b) except as otherwise provided in Section
9.01(b), any Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed pursuant to
the respective Guaranty, provided that in the case of Section 13 of the
Subsidiary Guaranty, if the default constitutes a failure to perform or comply
with any provision,
-58-
covenant or agreement contained in Section 7 (other than Section 7.08) of this
Agreement, such default shall continue unremedied for a period of at least 30
days after notice to the defaulting Guarantor by the Administrative Agent or the
Required Banks; or
9.08 Judgments. One or more judgments or decrees shall be
entered against the Company or any of its Restricted Subsidiaries involving a
liability of $8,000,000 or more in the case of any one such judgment or decree
or $20,000,000 or more in the aggregate for all such judgments and decrees for
the Company and its Restricted Subsidiaries (not paid or to the extent not
covered by insurance) and any such judgments or decrees shall not have been
vacated, discharged or stayed or bonded pending appeal within 60 days from the
entry thereof; or
9.09 Ownership. A Change of Control Event shall have occurred;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent shall, upon the written
request of the Required Banks, by written notice to the Company, take any or all
of the following actions, without prejudice to the rights of the Administrative
Agent, the Letter of Credit Issuer or any Bank to enforce its claims against the
Company, except as otherwise specifically provided for in this Agreement
(provided that if an Event of Default specified in Section 9.05 shall occur with
respect to the Company, the result which would occur upon the giving of written
notice by the Administrative Agent as specified in clauses (i) and (ii) below
shall occur automatically without the giving of any such notice): (i) declare
the Total Commitment (or the unutilized portion thereof) terminated, whereupon
the Commitment of each Bank (or the unutilized portion thereof) shall forthwith
terminate immediately and any Commitment Fees shall forthwith become due and
payable without any other notice of any kind; (ii) declare the principal of and
any accrued interest in respect of all Loans and all obligations owing hereunder
(including Unpaid Drawings) to be, whereupon the same shall become, forthwith
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Company; (iii) terminate any Letter
of Credit which may be terminated in accordance with its terms; and (iv) direct
the Company to pay (and the Company hereby agrees upon receipt of such notice,
or upon the occurrence of any Event of Default specified in Section 9.05, to
pay) to the Administrative Agent at the Payment Office such additional amounts
of cash, to be held as security for the Company's reimbursement obligations in
respect of Letters of Credit then outstanding, equal to the aggregate Stated
Amount of all Letters of Credit then outstanding.
SECTION 10. Definitions. As used herein, the following terms
shall have the meanings herein specified unless the context otherwise requires.
Defined terms in this Agreement shall include in the singular number the plural
and in the plural the singular:
"Additional Credit Agreement" shall mean the credit agreement,
dated as of the date hereof, among the Company, various lending institutions,
The Bank of New York and Bankers Trust Company, as Co-Syndication Agents, The
Bank of Nova Scotia, as Documentation Agent, and The Chase Manhattan Bank, as
Administrative Agent, as amended, modified, supplemented or extended from time
to time in accordance with the terms thereof and hereof.
-59-
"Additional Facility Amount" shall mean at any time, the
aggregate commitments then outstanding under the Additional Credit Agreement,
provided that, if at such time, the commitments under the Additional Credit
Agreement shall have terminated "Additional Facility Amount" shall mean, at such
time, the aggregate principal amount of loans outstanding under the Additional
Credit Facility at such time.
"Additional Facility Documents" shall mean and include each of
the documents and other agreements entered into by the Company or any of its
Subsidiaries in connection with the Additional Credit Agreement (including,
without limitation, the Additional Credit Agreement and any guaranty or
guaranties relating thereto), as in effect on the Initial Borrowing Date and as
the same may be modified, supplemented or amended from time to time pursuant to
the terms hereof and thereof.
"Additional Indebtedness" shall have the meaning provided in
Section 8.04(h).
"Additional Preferred Stock" shall have the meaning provided
in Section 8.12(c).
"Additional Tranche B Assumption Date" shall mean the date on
which each Tranche B Assumption Agreement is delivered to the Administrative
Agent after the Initial Tranche B Assumption Date pursuant to Section 1.13 of
this Agreement.
"Adjusted Percentage" shall mean (x) at a time when no Bank
Default exists, for each Bank such Bank's Tranche A Percentage and (y) at a time
when a Bank Default exists (i) for each Bank that is a Defaulting Bank, zero and
(ii) for each Bank that is a Non-Defaulting Bank, the percentage determined by
dividing such Bank's Tranche A Revolving Loan Commitment at such time by the
Adjusted Total Tranche A Commitment at such time, it being understood that all
references herein to Tranche A Revolving Loan Commitments and the Adjusted Total
Tranche A Commitment at a time when the Total Tranche A Revolving Loan
Commitment or Adjusted Total Tranche A Commitment, as the case may be, has been
terminated shall be references to the Tranche A Revolving Loan Commitments or
Adjusted Total Tranche A Commitment, as the case may be, in effect immediately
prior to such termination, provided that (A) no Bank's Adjusted Percentage shall
change upon the occurrence of a Bank Default from that in effect immediately
prior to such Bank Default if, after giving effect to such Bank Default and any
repayment of Tranche A Revolving Loans, Swingline Loans and Canadian Dollar
Loans at such time pursuant to Section 4.02(a) or otherwise, the sum of (i) the
aggregate outstanding principal amount of Tranche A Revolving Loans of all
Non-Defaulting Banks plus (ii) the aggregate outstanding principal amount of
Swingline Loans plus (iii) the Dollar Equivalent of the aggregate outstanding
principal amount of Canadian Dollar
-60-
Loans plus (iv) the Letter of Credit Outstandings, exceeds the Adjusted Total
Tranche A Commitment; (B) the changes to the Adjusted Percentage that would have
become effective upon the occurrence of a Bank Default but that did not become
effective as a result of the preceding clause (A) shall become effective on the
first date after the occurrence of the relevant Bank Default on which the sum of
(i) the aggregate outstanding principal amount of the Tranche A Revolving Loans
of all Non-Defaulting Banks plus (ii) the aggregate outstanding principal amount
of Swingline Loans plus (iii) the Dollar Equivalent of the aggregate outstanding
principal amount of Canadian Dollar Loans plus (iv) the Letter of Credit
Outstandings is equal to or less than the Adjusted Total Tranche A Commitment;
and (C) if (i) a Non-Defaulting Bank's Adjusted Percentage is changed pursuant
to the preceding clause (B) and (ii) any repayment of such Bank's Tranche A
Revolving Loans, or of Unpaid Drawings with respect to Letters of Credit or of
Swingline Loans or Canadian Dollar Loans, that was made during the period
commencing after the date of the relevant Bank Default and ending on the date of
such change to its Adjusted Percentage must be returned to either Borrower as a
preferential or similar payment in any bankruptcy or similar proceeding of such
Borrower, then the change to such Non-Defaulting Bank's Adjusted Percentage
effected pursuant to said clause (B) shall be reduced to that positive change,
if any, as would have been made to its Adjusted Percentage if (x) such
repayments had not been made and (y) the maximum change to its Adjusted
Percentage would have resulted in the sum of the outstanding principal of
Tranche A Revolving Loans made by such Bank plus such Bank's new Adjusted
Percentage of the outstanding principal amount of Swingline Loans and Dollar
Equivalent of Canadian Dollar Loans and of Letter of Credit Outstandings
equaling such Bank's Tranche A Revolving Loan Commitment at such time.
"Adjusted Total Tranche A Commitment" shall mean at any time
the Total Tranche A Revolving Loan Commitment less the aggregate Tranche A
Revolving Loan Commitments of all Defaulting Banks.
"Adjusted Tranche A Commitment" for each Non-Defaulting Bank
shall mean at any time the product of such Bank's Adjusted Percentage and the
Adjusted Total Tranche A Commitment.
"Administrative Agent" shall have the meaning provided in the
first paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to Section 11.10.
"Affected Eurodollar Loan" shall have the meaning provided in
Section 4.02(h).
"Affected Period" shall mean, with respect to each Affected
Transaction, the period commencing on the date occurring twelve months prior to
the last day of the then most recently ended fiscal quarter of the Company and
ending on the date such Affected Transaction is consummated.
"Affected Transaction" shall mean and include each of the
following: (i) any transfer of assets to an Excluded Domestic Restricted
Subsidiary in connection with a transaction permitted pursuant to Section
8.02(e), (ii) any Permitted Acquisition, (iii) any incurrence of Additional
Indebtedness, (iv) any investment in an Excluded Domestic Restricted Subsidiary
pursuant to Section 8.05(d), (v) any issuance of Subordinated Exchange
Debentures, (vi) the payment of any Dividend as permitted by Section 8.07(k) or
(l), (vii) any issuance of Additional Preferred Stock, (viii) any Permitted
Restricted Subsidiary Conversion or Non-Guarantor Designation and (ix) any
designation of an Unrestricted Subsidiary as a Restricted Subsidiary pursuant to
the definition of "Restricted Subsidiaries."
-61-
"Affiliate" shall mean, with respect to any Person, any other
Person directly or indirectly controlling (including but not limited to all
directors and officers of such Person), controlled by, or under direct or
indirect common control with such Person. A Person shall be deemed to control a
corporation if such Person possesses, directly or indirectly, the power (i) to
vote 10% or more of the securities having ordinary voting power for the election
of directors of such corporation or (ii) to direct or cause the direction of the
management and policies of such corporation, whether through the ownership of
voting securities, by contract or otherwise.
"Aggregate Conversion Amount" shall mean, at any time, the sum
of the Conversion Value Amount with respect to each Permitted Restricted
Subsidiary Conversion consummated after the Original Effective Date but on or
prior to the date of determination thereof.
"Aggregate Unutilized Revolving Loan Commitment" with respect
to any Bank at any time shall mean the sum of (x) such Bank's Tranche A
Revolving Loan Commitment at such time less the sum of (i) the aggregate
outstanding principal amount of all Tranche A Revolving Loans made by such Bank
and (ii) such Bank's Adjusted Percentage of the Letter of Credit Outstandings at
such time and (y) such Bank's Tranche B Revolving Loan Commitment at such time
less the aggregate outstanding principal amount of all Tranche B Revolving Loans
made by such Bank.
"Aggregate Unutilized Tranche A Commitment" of any Bank at any
time shall mean the Aggregate Unutilized Revolving Loan Commitment of such Bank
at such time without giving effect to clause (y) of the definition of Aggregate
Unutilized Revolving Loan Commitment.
"Agreement" shall mean this Credit Agreement, as the same may
be from time to time modified, amended and/or supplemented.
"Applicable B Term Loan Margin" shall mean, at any time, (a)
with respect to Base Rate Loans, the margin set forth below under the heading
Applicable B Term Loan Base Rate Margin and (b) with respect to Eurodollar
Loans, the margin set forth below under the heading Applicable B Term Loan
Eurodollar Margin, in each case, opposite the ratio of (i) Consolidated Debt as
of the last day of the most recent fiscal year or fiscal quarter in respect of
which the Banks shall have received Section 7.01 Financials to (ii) Consolidated
EBITDA for the Test Period ending on the last day of such fiscal year or fiscal
quarter (it being understood that each Applicable B Term Loan Margin shall be in
effect from the date the respective Section 7.01 Financials are required to be
delivered to the Banks until the date the next such Section 7.01 Financials are
required to be delivered to the Banks at which time the Applicable B Term Loan
Margin shall be reset in accordance with the foregoing provisions of this
definition):
Applicable B Term Loan Applicable B Term Loan Base
Eurodollar Rate
Debt/EBITDA Ratio Margin Margin
----------------- ------ ------
-62-
5.00:1 or Greater 2.75% 1.75%
Less than 5.00:1 2.375% 1.375%
; provided that (I) until delivery of the Section 7.01 Financials for the fiscal
quarter ending September 30, 1999 the Applicable B Term Loan Margin shall be
2.75% for Eurodollar Loans and 1.75% for Base Rate Loans and (II) if (A) any
Section 7.01 Financials are not delivered when required (the "Late Section 7.01
Financials") and such Late Section 7.01 Financials establish that any Applicable
B Term Loan Margin would have been increased or reduced to an amount set forth
in the table above on the date that such Late Section 7.01 Financials were
required to have been delivered (the "Required Delivery Date") and (B) a
Borrower shall have made any interest payment during the period from the
Required Delivery Date to the actual date of delivery of such Late Section 7.01
Financials based upon any such lower or higher Applicable B Term Loan Margin,
then (x) in the case of actual payments based on any such lower Applicable B
Term Loan Margin, the respective Borrower shall pay in the form of a
supplemental interest payment, an amount which equals the difference between the
amount of interest which would otherwise have been paid determined as if the
Late Section 7.01 Financials were delivered on the Required Delivery Date and
the amount of such interest so paid, which supplemental interest payment shall
be due and payable on the date of delivery of the Late Section 7.01 Financials
and (y) in the case of actual payments made based on such higher Applicable B
Term Loan Margin, the Banks shall retain all such amounts so paid.
"Applicable Commitment Fee Percentage" shall mean 3/8 of 1%,
provided that in the event that and for so long as the ratio of (i) Consolidated
Debt as of the last day of the most recent fiscal year or fiscal quarter in
respect of which the Banks shall have received Section 7.01 Financials to (ii)
Consolidated EBITDA for the Test Period ending on the last day of such fiscal
year or fiscal quarter is less than 4.50:1, then the Applicable Commitment Fee
Percentage shall be 1/4 of 1% (it being understood that each Applicable
Commitment Fee Percentage shall be in effect from the date the respective
Section 7.01 Financials are required to be delivered to the Banks until the date
the next such Section 7.01 Financials are required to be delivered to the Banks
at which time the Applicable Commitment Fee Percentage shall be reset in
accordance with the foregoing provisions of this definition), provided further,
that if (A) any Section 7.01 Financials are not delivered when required (the
"Late Section 7.01 Financials") and such Late Section 7.01 Financials establish
that the Applicable Commitment Fee Percentage would have been increased or
reduced to a percentage set forth above on the date that such Late Section 7.01
Financials were required to have been delivered (the "Required Delivery Date")
and (B) the Company shall have made any payment of Commitment Fees during the
period from the Required Delivery Date to the actual date of delivery of such
Late Section 7.01 Financials based upon any such lower or higher Applicable
Commitment Fee Percentage, then (x) in the case of actual payments made based on
any such lower Applicable Commitment Fee Percentage, the Company shall pay in
the form of a supplemental Commitment Fee payment an amount which equals the
difference between the amount of Commitment Fees which would otherwise have been
paid determined as if the Late Section 7.01 Financials were delivered on the
Required Delivery Date and the amount of such Commitment Fees so paid, which
supplemental Commitment Fee payment shall be due and payable on the date of
delivery of such Late Section
-63-
7.01 Financials and (y) in the case of actual payments made based on such higher
Applicable Commitment Fee Percentage, the Banks shall retain all amounts so
paid.
"Applicable Letter of Credit Fee Percentage" shall mean, at
any time, the Applicable Margin then in effect for Eurodollar Loans less 1/4 of
1%.
"Applicable Margin" shall mean, at any time, (a) with respect
to Base Rate Loans, the margin set forth below under the heading Applicable Base
Rate Margin and (b) with respect to Eurodollar Loans, the margin set forth below
under the heading Applicable Eurodollar Margin, in each case, opposite the ratio
of (i) Consolidated Debt as of the last day of the most recent fiscal year or
fiscal quarter in respect of which the Banks shall have received Section 7.01
Financials to (ii) Consolidated EBITDA for the Test Period ending on the last
day of such fiscal year or fiscal quarter (it being understood that each
Applicable Margin shall be in effect from the date the respective Section 7.01
Financials are required to be delivered to the Banks until the date the next
such Section 7.01 Financials are required to be delivered to the Banks at which
time the Applicable Margin shall be reset in accordance with the foregoing
provisions of this definition):
Applicable Applicable Base
Eurodollar Rate
Debt/EBITDA Ratio Margin Margin
----------------- ------ ------
5.50:1 or Greater 1-1/2% 1/8 of 1%
Less than 5.50:1 but equal 1-1/8% 0%
to or greater than 5.00:1
Less than 5.00:1 but equal to or 7/8 of 1% 0%
greater than 4.50:1
Less than 4.50:1 but equal to or 5/8 of 1% 0%
greater than 4.00:1
Less than 4.00:1 1/2 of 1% 0%
; provided that if (A) any Section 7.01 Financials are not delivered when
required (the "Late Section 7.01 Financials") and such Late Section 7.01
Financials establish that any Applicable Margin would have been increased or
reduced to an amount set forth in the table above on the date that such Late
Section 7.01 Financials were required to have been delivered (the "Required
Delivery Date") and (B) a Borrower shall have made any interest payment during
the period from the Required Delivery Date to the actual date of delivery of
such Late Section 7.01 Financials based upon any such lower or higher Applicable
Margin, then (x) in the case of actual payments based on any such lower
Applicable Margin, the respective Borrower shall pay in the form of a
supplemental interest payment, an amount which equals the difference between the
amount of interest which would otherwise have been paid determined as if the
Late Section 7.01 Financials were delivered on the Required Delivery Date and
the amount of such interest so paid, which supplemental interest payment shall
be due and payable on the date of delivery of the Late Section 7.01 Financials
and (y) in the case of actual payments made based on such higher Applicable
Margin, the Banks shall retain all such amounts so paid.
-64-
"Appraisal Firm" shall mean an independent appraisal firm
(which may be an investment banking firm of national recognition) selected by,
and at the expense of, the Company and reasonably satisfactory to the
Administrative Agent.
"Approved Fund" shall mean, with respect to any Bank, any fund
or commingled investment vehicle that invests in loans and is managed or advised
by the same investment advisor (or an affiliate of such investment advisor) as
such Bank or an affiliate of such Bank.
"Asset Sale" shall mean any sale, transfer or other
disposition by the Company or any of its Restricted Subsidiaries to any Person
other than the Company or any Restricted Subsidiary of any asset (including,
without limitation, any capital stock or other securities of another Person, but
excluding any sale, transfer or other disposition by the Company of its capital
stock) of the Company or such Restricted Subsidiary, including, without
limitation, a Permitted Restricted Asset Sale and any sale, transfer or other
disposition deemed made pursuant to a Permitted Restricted Subsidiary Conversion
(other than (x) any sale, transfer or disposition of Cash Equivalents; (y) any
sale, transfer or disposition permitted by Section 8.02(a), (e) or (h); and (z)
for purposes of Sections 3.03(e), any sale, transfer or disposition of assets
(other than capital stock or other securities of any Subsidiary) that results in
Available Cash Proceeds (including Available Cash Proceeds of any related sale,
transfer or disposition) of not in excess of $10,000,000).
"Authorized Officer" shall mean any officer of the Company
designated as such in writing to the Administrative Agent by the Company, in
each case to the extent reasonably acceptable to the Administrative Agent.
"Available Cash Proceeds" shall mean, with respect to any
sale, lease, transfer or other disposition of assets, the aggregate cash
payments (including any cash received by way of deferred payment pursuant to a
note receivable issued in connection with such sale, lease, transfer or other
disposition, other than the portion of such deferred payment constituting
interest, and including any amounts received as disbursement or withdrawals from
any escrow or similar account established in connection with any such sale,
lease, transfer or other disposition, but, in either such case, only as and when
so received; but excluding any portion of cash payments which the Company
determines in good faith (x) should be reserved for post-closing adjustments (to
the extent the Company delivers to the Banks a certificate signed by its chief
financial officer, controller or chief accounting officer as to such
determination) or (y) must be applied to repurchase Senior Notes pursuant to the
Senior Note Documents (to the extent the Company delivers to the Banks a
certificate signed by its chief financial officer, controller or chief
accounting officer as to such determination), it being understood and agreed
that on the date that all such post-closing adjustments have been determined
and/or the date such repurchases shall be required to be effected, as the case
may be, the amount (if any) by which the reserved amount in respect of such sale
or disposition exceeds the actual post-closing adjustments payable by the
Company or any of its Subsidiaries or actual amount expended in connection with
such repurchases, as the case may be, shall constitute Available Cash Proceeds
on such date) received by the Company and/or any of its Subsidiaries from such
sale, lease, transfer or other disposition.
-65-
"Bank" shall have the meaning provided in the first paragraph
of this Agreement; provided that for purposes of references in this Agreement to
Canadian Dollar Loans, "Bank" shall include the Canadian Lender.
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing or to fund
its portion of any assignment of Canadian Dollar Loans under Section 1.01(g) or
to fund its portion of any unreimbursed payment under Section 2.05(c) or (ii) a
Bank having notified the Administrative Agent and/or the Company that it does
not intend to comply with the obligations under Section 1.01(b), 1.01(c),
1.01(e), 1.01(g) or 2.05(c), in the case of either (i) or (ii) as a result of
the appointment of a receiver or conservator with respect to such Bank at the
direction or request of any regulatory agency or authority.
"Bankruptcy Code" shall have the meaning provided in Section
9.05.
"Base Rate" at any time shall mean (i) in the case of Canadian
Dollar Loans, the Canadian Lender Prime Lending Rate as in effect from time to
time and (ii) in the case of Loans other than Canadian Dollar Loans, the higher
of (x) the rate which is 1/2 of 1% in excess of the Federal Funds Effective Rate
and (y) the Prime Lending Rate as in effect from time to time.
"Base Rate Loan" shall mean each Loan bearing interest at the
rates provided in Section 1.08(a).
"BONY Term Loan Facility" shall mean the credit facility among
the Company, various lending institutions and The Bank of New York, as Agent,
providing for the making of term loans to the Company in an aggregate amount not
to exceed $150,000,000 outstanding at any time, as same may have been modified,
supplemented or amended from time to time pursuant to the terms thereof.
"Borrower" shall mean each of the Company and the Canadian
Borrower.
"Borrowing" shall mean a borrowing of Loans under a single
Tranche from all Banks having Commitments with respect to such Tranche (or (x)
from Chase in the case of Swingline Loans and (y) from the Canadian Lender in
the case of Canadian Dollar Loans) on a given date (or resulting from
conversions on a given date), in each case, as required by the provisions of
this Agreement, being of a single Type of Loans and having, in the case of
Eurodollar Loans, the same Interest Period, provided that Base Rate Loans
incurred pursuant to Section 1.10(b) shall be considered part of any related
Borrowing of Eurodollar Loans.
"B Term Loan" shall have the meaning provided in Section
1.01(h).
"B Term Loan Commitment" shall mean, with respect to each
Bank, the amount set forth opposite such Bank's name in Annex I hereto directly
below the column entitled "B Term Loan Commitment," as same may be reduced from
time to time pursuant to Sections 3.03 and/or 9.
-66-
"Business" shall mean and include the communications,
information, education, publishing and/or media businesses.
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) or (iii) below, any day excluding Saturday, Sunday and
any day which shall be in the City of New York a legal holiday or a day on which
banking institutions are authorized by law or other governmental actions to
close, (ii) with respect to all notices and determinations in connection with,
and payments of principal and interest on, Eurodollar Loans, any day which is a
Business Day described in clause (i) and which is also a day for trading by and
between banks in U.S. dollar deposits in the interbank Eurodollar market and
(iii) with respect to all notices and determinations in connection with, and
payments of principal and interest on, Canadian Dollar Loans, any day which is a
Business Day described in clause (i) and which is also a day which is not in
Toronto, Canada a legal holiday or a day on which banking institutions are
authorized by law or other governmental actions to close.
"Canadian Borrower" shall have the meaning provided in the
first paragraph of this Agreement.
"Canadian Borrower Management Agreement" shall mean the
Management Agreement, dated as of March 9, 1994 between the Canadian Borrower
and K-III Directory Corporation, as amended to the Original Effective Date and
as further amended, modified or supplemented from time to time in accordance
with the terms hereof and thereof.
"Canadian Dollar" and "Can.$" shall mean freely transferable
lawful money of Canada.
"Canadian Dollar Loan" shall have the meaning provided in
Section 1.01(f).
"Canadian Lender" shall mean The Bank of Nova Scotia.
"Canadian Lender Prime Lending Rate" at any time shall mean
the higher of (i) the rate per annum designated by the Canadian Lender from time
to time (and in effect on such day) as its prime rate for Canadian Dollar
commercial loans made in Canada and (ii) one-half of one percent (1/2%) plus the
CDOR Rate from time to time (and in effect on such day), as advised by the
Canadian Lender to the Canadian Borrower and the Administrative Agent from time
to time. The Canadian Lender Prime Lending Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer.
The Canadian Lender may make commercial loans or other loans at rates of
interest at, above or below the Canadian Lender Prime Lending Rate.
"Canadian Notice Office" shall mean the office of the Canadian
Lender set forth as the Canadian Notice Office on Annex II hereto, or such other
office as the Canadian Lender may designate to the Company, the Administrative
Agent and the Banks from time to time.
-67-
"Canadian Payment Office" shall mean the office of the
Canadian Lender set forth as the Canadian Payment Office on Annex II hereto, or
such other office as the Canadian Lender may designate to the Company, the
Administrative Agent and the Banks from time to time.
"Capital Expenditures" shall mean, for any period, any
expenditures (whether paid in cash or accrued as liabilities and including in
all events all amounts expended or capitalized under Capital Leases) by any
Person during that period that, in conformity with GAAP, are or are required to
be included in the property, plant or equipment reflected in the balance sheet
of such Person.
"Capital Lease," as applied to any Person, shall mean any
lease of any property (whether real, personal or mixed) by that Person as lessee
which, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of that Person.
"Capitalized Lease Obligations" shall mean all obligations
under Capital Leases of the Company or any of its Restricted Subsidiaries in
each case taken at the amount thereof accounted for as liabilities in accordance
with GAAP.
"Cash Equivalents" shall mean (i) securities issued or
directly and fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and credit of
the United States of America is pledged in support thereof) having maturities of
not more than one year from the date of acquisition, (ii) U.S. dollar
denominated time deposits, certificates of deposit and bankers acceptances of
(x) any Bank, (y) any commercial bank of recognized standing having capital and
surplus in excess of $500,000,000 or (z) any bank whose short-term commercial
paper rating from Standard & Poor's Ratings Group ("S&P") is at least A-2 or the
equivalent thereof or from ▇▇▇▇▇'▇ Investors Service, Inc. ("▇▇▇▇▇'▇") is at
least P-2 or the equivalent thereof (any such bank or Bank, an "Approved Bank"),
in each case with maturities of not more than one year from the date of
acquisition, (iii) commercial paper issued by any Approved Bank or by the parent
company of any Approved Bank and commercial paper issued by, or guaranteed by,
any industrial or financial company with a short-term commercial paper rating of
at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent
thereof by Moody's, or guaranteed by any industrial company with a long term
unsecured debt rating of at least A or A2, or the equivalent of each thereof,
from S&P or Moody's, as the case may be, and in each case maturing within one
year after the date of acquisition, (iv) marketable direct obligations issued by
any state of the United States of America or any political subdivision of any
such state or any public instrumentality thereof maturing within one year from
the date of acquisition thereof and, at the time of acquisition, having one of
the two highest ratings obtainable from either S&P or Moody's and (v)
investments in money market funds substantially all the assets of which are
comprised of securities of the types described in clauses (i) through (iv)
above.
"CDOR Rate" shall mean that annual rate of interest equal to
the average "BA 1 Month" interest rates for Canadian Dollar denominated bankers'
acceptances displayed and identified as such on the "Reuters Screen CDOR Page"
(as defined in the International Swap and Derivatives Association, Inc.
definitions, as modified and amended from time to time) as of
-68-
10:00 A.M., Toronto, Ontario local time on any particular day and, if such day
is not a Business Day, then on the immediately preceding Business Day (as
adjusted by the Canadian Lender after 10:00 A.M., Toronto, Ontario local time to
reflect any error in a posted rate of interest or in the posted average annual
rate of interest). If such rates are not available on the Reuters Screen CDOR
Page on any particular day, then the CDOR Rate on that day shall be calculated
as the arithmetic mean of the 30 day rates applicable to Canadian dollar
denominated banker's acceptances quoted by four major Canadian Schedule I
chartered banks as of 10:00 A.M., Toronto, Ontario local time on such day, or if
such day is not a Business Day, then on the immediately preceding Business Day.
The four major Canadian Schedule I chartered banks shall, unless the Canadian
Borrower and the Canadian Lender otherwise agree, be The Toronto-Dominion Bank,
The Bank of Nova Scotia, Royal Bank of Canada and Canadian Imperial Bank of
Commerce. The arithmetic average of any rates or quotations to be calculated
hereunder shall be rounded, if necessary, to the nearest 1/100,000 of one
percent (.00001%), with five one millionths of a percentage point rounded
upwards. All dollar amounts used in or resulting from any calculation based on
the CDOR Rate will be rounded to the nearest cent (with one-half of one cent
rounded upwards).
"Change of Control Event" shall mean (a) any "Change of
Control" or similar term as defined in the indentures governing the terms of the
Senior Notes as in effect on the Initial Borrowing Date or in any agreement
governing any Indebtedness incurred pursuant to Section 8.04(f), (h), (i) or
(j), (b) KKR or one or more Affiliates of KKR shall cease to own (directly or
indirectly) at least 25% on a fully diluted basis of the economic and voting
interest in the Company's common stock or (c) any Person or "group" (within the
meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 ,
as amended) becomes the "beneficial owner" (as defined in Rule 13d-3 of the
Securities Exchange Act of 1934, as amended) of more of the voting common stock
of the Company than that owned (directly or indirectly) by KKR and its
Affiliates.
"Chase" shall mean The Chase Manhattan Bank or any successor
thereto by merger.
"Chase Revolving Credit Facility" shall mean the amended and
restated credit facility among the Company, the Canadian Borrower, various
lending institutions, Bank of America NT&SA, The Bank of New York, The Bank of
Nova Scotia, Bankers Trust Company, Canadian Imperial Bank of Commerce and
Societe Generale, as Co-Agents, and Chase, as Administrative Agent, providing
for the making of revolving loans and the issuance of, and participation in,
letters of credit in an aggregate amount not to exceed $670,000,000 outstanding
at any time, as same may have been modified, supplemented or amended from time
to time pursuant to the terms thereof.
"Chase Term Loan Facility" shall mean the credit facility
among the Company, various lending institutions, Bank of America Illinois, The
Bank of Nova Scotia, Chemical Bank, Midland Bank plc and The Industrial Bank of
Japan, Limited, as Co-Agents, and Chase, as Administrative Agent, providing for
the making of term loans in an aggregate amount not to
-69-
exceed $150,000,000 outstanding at any time, as same may have been modified,
supplemented or amended from time to time pursuant to the terms thereof.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time and the regulations promulgated and the rulings issued
thereunder. Section references to the Code are to the Code, as in effect at the
date of this Agreement and any subsequent provisions of the Code amendatory
thereof, supplemental thereto or substituted therefor.
"Commitment" shall mean, at any time, for any Bank the sum of
the Term Loan Commitment, B Term Loan Commitment, Tranche A Revolving Loan
Commitment, and Tranche B Revolving Loan Commitment of such Bank at such time.
"Commitment Fee" shall have the meaning provided in Section
3.01(a).
"Company" shall have the meaning provided in the first
paragraph of this Agreement.
"Company Guaranty" have the meaning provided in Section
5.01(e)(ii).
"Consolidated Capital Expenditures" shall mean, for any
period, the aggregate of all Capital Expenditures by the Company and its
Restricted Subsidiaries at such time determined on a consolidated basis.
"Consolidated Current Assets" shall mean, at any time, the
current assets (other than cash and Cash Equivalents, and deferred income taxes
to the extent included in current assets) of the Company and its Restricted
Subsidiaries at such time determined on a consolidated basis.
"Consolidated Current Liabilities" shall mean, at any time,
the current liabilities of the Company and its Restricted Subsidiaries
determined on a consolidated basis, but excluding (i) all short-term
Indebtedness for borrowed money, (ii) the current portion of any long-term
Indebtedness of the Company or its Restricted Subsidiaries, (iii) deferred
income taxes, (iv) liabilities arising from cash overdrafts, and (v) liabilities
arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument inadvertently (except in the case of daylight
overdrafts) drawn against insufficient funds in the ordinary course of business,
provided that such liabilities are extinguished within three Business Days of
their incurrence; in each case to the extent included in current liabilities.
"Consolidated Debt" shall mean all Indebtedness of the Company
and its Restricted Subsidiaries, determined on a consolidated basis, other than
Indebtedness owing by the Company to any of its Restricted Subsidiaries or by
any of the Company's Restricted Subsidiaries to the Company or any other
Restricted Subsidiary of the Company, provided that, for purposes of this
definition, (x) only the principal amount of Indebtedness outstanding under the
Non-Compete Notes issued as of the date of determination (net of the amount of
any reduction to the amounts owed under such Non-Compete Notes made in
accordance with the terms of the Non-Competition Agreement referred to in the
definition of Non-Compete Notes)
-70-
shall be included and (y) Indebtedness of any Partially-Owned Restricted
Subsidiary shall be included in Consolidated Debt in an aggregate amount equal
to the percentage equity ownership of the Company in such Partially-Owned
Restricted Subsidiary multiplied by the aggregate Indebtedness of such
Partially-Owned Restricted Subsidiary.
"Consolidated EBITDA" shall mean, for any period, (A) the sum
(without duplication) of the amounts for such period of (i) the net income (or
loss) of the Company and its Restricted Subsidiaries on a consolidated basis for
such period taken as a single accounting period, provided that, except as
provided in clauses (I) through (III) below, there shall be excluded from
Consolidated EBITDA (x) the net income (or loss) of all Unrestricted
Subsidiaries and all Partially-Owned Restricted Subsidiaries for such period and
(y) all cash or other payments received during such period by the Company and
its Restricted Subsidiaries from any Unrestricted Subsidiaries from dividends or
distributions (including tax sharing payments), in each case to the extent
otherwise included, (ii) provisions for taxes based on income, (iii)
Consolidated Interest Expense, (iv) amortization or write-off of deferred
financing costs, (v) losses on sales of assets (excluding sales in the ordinary
course of business) and other extraordinary losses, (vi) non-cash amounts
charged as compensation for "phantom stock" arrangements, (vii) all non-cash
interest expense not included in the foregoing clause (vi), (viii) depreciation
expense and (ix) amortization expense, in the case of each of clauses (ii)
through (ix) above to the extent deducted in determining net income (or loss)
pursuant to clause (i) above for such period, less (B) the amount for such
period of gains on sales of assets (excluding sales in the ordinary course of
business) and other extraordinary gains, in each case, to the extent included in
determining net income (or loss) pursuant to clause (A)(i) above for such
period, all as determined on a consolidated basis; provided, however, that (I)
for purposes of Section 8.11 and the definitions of Applicable Margin and
Applicable Commitment Fee Percentage, (1) there shall be included in determining
Consolidated EBITDA for any period (x) the net income (or loss) of any person,
business, property or asset (other than an Unrestricted Subsidiary) acquired and
not subsequently sold or otherwise disposed of (but not including the net income
(or loss) of any related person, business, property or assets to the extent not
so acquired) by the Company or one of its Restricted Subsidiaries during such
period (each such person, business, property or asset acquired and not
subsequently disposed of, an "Acquired Entity or Business"), and the net income
(or loss) of any Unrestricted Subsidiary that is converted into a Restricted
Subsidiary during such period (each, a "Converted Restricted Subsidiary"), in
each case based on the actual net income (or loss) of such Acquired Entity or
Business or Converted Restricted Subsidiary for the entire period (including the
portion thereof occurring prior to such acquisition or conversion) and (y) an
increase in respect of each Acquired Entity or Business acquired during such
period equal to the cost adjustment amount applicable to the relevant period
determined by the Company to represent the savings secured by the Company in
connection with its reduction of salary and other employment expenses and lease
and other contractual expenses with respect to such Acquired Entity or Business
and (2) there shall be excluded in determining Consolidated EBITDA for any
period the net income (or loss) of any person, business, property or asset
(other than an Unrestricted Subsidiary) sold or disposed of by the Company or
one of its Restricted Subsidiaries during such period (each such person,
business, property or asset so sold or disposed of, a "Sold Entity or
Business"), and the net income (or loss) of any Restricted Subsidiary that is
converted into an Unrestricted Subsidiary during such period (each, a "Converted
Unrestricted
-71-
Subsidiary"), in each case based on the actual net income (or loss) of such Sold
Entity or Business or Converted Unrestricted Subsidiary for the entire period
(including the portion thereof occurring prior to such sale, disposition or
conversion), (II) for purposes of this definition, subject to clause (III)
below, there shall be included or excluded any of the items described in the
above clauses (A) and (B) attributable to a Partially-Owned Restricted
Subsidiary, but only to the extent of the equity percentage ownership of the
Company in such Partially-Owned Restricted Subsidiary and (III) in the event the
aggregate portion of Consolidated EBITDA for any period attributable to
Partially-Owned Restricted Subsidiaries (the "Limited EBITDA Component") exceeds
an amount equal to 15% of the aggregate amount of Consolidated EBITDA of the
Company and its Restricted Subsidiaries for such period, the Limited EBITDA
Component (and accordingly Consolidated EBITDA), in each case, for such period,
shall be reduced such that the Limited EBITDA Component for such period equals
15% of the aggregate amount of such Consolidated EBITDA for such period.
"Consolidated Fixed Charges" shall mean, for any period, the
sum, without duplication, of the amounts for such period of (i) Consolidated
Interest Expense, plus consolidated cash Dividend expense payable in respect of
all Preferred Stock and common stock of the Company, (ii) provisions for taxes
based on income other than (x) changes in deferred taxes, (y) taxes on gains
resulting from sales of assets (other than sales in the ordinary course of
business) and (z) taxes on gains on extraordinary items, (iii) Consolidated
Capital Expenditures paid in cash, (iv) scheduled payments on Indebtedness for
borrowed money (including the Term Loans, the B Term Loans and the loans
outstanding under the Additional Credit Agreement and the 1999 Additional Credit
Agreement but excluding the Revolving Loans) and on the Non-Compete Notes (other
than, in the case of any payments referred to in this clause (iv), any interest
payments to the extent included in Consolidated Interest Expense), and (v) the
Net Maximum Exposure Reduction, if positive, for such period; all as determined
on a consolidated basis for the Company and its Restricted Subsidiaries;
provided that for purposes of this definition, fixed charges of the type
referred to in clauses (i)-(v) above of any Partially-Owned Restricted
Subsidiary shall be included in Consolidated Fixed Charges in an aggregate
amount equal to the percentage equity ownership of the Company in such
Partially-Owned Restricted Subsidiary multiplied by the fixed charges of the
type referred to above of such Partially-Owned Restricted Subsidiary for the
respective period.
"Consolidated Interest Expense" shall mean, for any period,
total interest expense (including that attributable to Capital Leases in
accordance with GAAP but excluding non-cash interest expenses) of the Company
and its Restricted Subsidiaries determined on a consolidated basis with respect
to all outstanding Indebtedness of the Company and its Restricted Subsidiaries,
including, without limitation, all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs (i.e., costs minus benefits) under Interest Rate Protection
Agreements, but excluding, however, amortization of deferred financing costs to
the extent included in total interest expense, all as determined on a
consolidated basis; provided that for purposes of this definition, interest
expense of the type referred to above of any Partially-Owned Restricted
Subsidiary shall be included in Consolidated Interest Expense in an aggregate
amount equal to the percentage equity ownership of the
-72-
Company in such Partially-Owned Restricted Subsidiary multiplied by the interest
expense of the type referred to above of such Partially-Owned Restricted
Subsidiary for the respective period.
"Contingent Obligations" shall mean as to any Person (i) any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (a) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (b) to advance or
supply funds (x) for the purchase or payment of any such primary obligation or
(y) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (c) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (d) otherwise to assure or hold
harmless the owner of such primary obligation against loss in respect thereof
and (ii) any Interest Rate Protection Agreement; provided, however, that the
term Contingent Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business. The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such Person is
required to perform thereunder) as determined by such Person in good faith.
"Contribution Agreement" shall have the meaning provided in
Section 5.01(h).
"Conversion Value Amount" shall have the meaning set forth in
the definition of Permitted Restricted Subsidiary Conversion.
"Convertible Subordinated Debenture" shall mean the debenture
issued by the Canadian Borrower to K-III Directory Corporation, convertible into
shares of the Canadian Borrower's common stock at the option of K-III Directory
Corporation, as amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof.
"Copyrights" shall have the meaning provided in
Section 6.14(a).
"Credit Documents" shall mean this Agreement, any Notes to the
extent issued, the Guaranties and the Contribution Agreement.
"Credit Event" shall mean the making of a Loan or the issuance
of a Letter of Credit.
"Credit Party" shall mean the Company, the Canadian Borrower
and each Subsidiary Guarantor.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
-73-
"Defaulting Bank" shall mean any Bank with respect to which a
Bank Default is in effect.
"Dividends" shall have the meaning provided in Section 8.07.
"Dollar Equivalent" shall mean, at any time of determination
thereof, the amount of U.S. Dollars which could be purchased with the same
amount of Canadian Dollars involved in such computation at the spot exchange
rate therefor as published in the New York edition of The Financial Times on the
date two Business Days prior to the date of any determination thereof for
purchase on such date, provided that if the New York edition of The Financial
Times is not published on such date, reference shall be made to such rate as set
forth in the most recently published New York edition of The Financial Times,
provided further, that if at any time the New York edition of The Financial
Times ceases to publish such exchange rates, the Dollar Equivalent shall be the
amount of U.S. Dollars which could be purchased with the amount of Canadian
Dollars involved in such computation at the spot rate therefor as quoted by the
Administrative Agent at approximately 11:00 A.M. (London time) on the date two
Business Days prior to the date of any determination thereof for purchase on
such date.
"EBITDA" shall mean, for any Restricted Subsidiary or
business, for any period, the portion of Consolidated EBITDA attributable to
such Restricted Subsidiary or business.
"Environmental Law" shall mean any federal, state, provincial
or local statute, law, rule, regulation, ordinance, code, policy or rule of
common law now or hereafter in effect and in each case as amended, and any
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to the environment,
health, safety or Hazardous Materials.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and the
rulings issued thereunder. Section references to ERISA are to ERISA as in effect
at the date of this Agreement and any subsequent provisions of ERISA amendatory
thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with the Company or any Subsidiary of the
Company would be deemed to be a "single employer" within the meaning of Section
414(b), (c), (m) or (o) of the Code.
"Eurodollar Loans" shall mean each Loan bearing interest at
the rates provided in Section 1.08(b).
"Eurodollar Rate" shall mean with respect to each Interest
Period for a Eurodollar Loan, (i) the arithmetic average (rounded to the nearest
1/100 of 1%) of the offered quotation to first-class banks in the interbank
Eurodollar market by each Reference Bank (or by the Canadian Lender in the case
of Canadian Dollar Loans) for U.S. dollar deposits (or Canadian Dollar deposits
in the case of Canadian Dollar Loans) of amounts in same day funds comparable to
the outstanding principal amount of the Eurodollar Loan of such Reference Bank
(or the Canadian
-74-
Lender, as the case may be) for which an interest rate is then being determined
with maturities comparable to the Interest Period to be applicable to such
Eurodollar Loan, determined as of 10:00 A.M. (New York time) on the date which
is two Business Days prior to the commencement of such Interest Period divided
(and rounded upward to the next whole multiple of 1/16 of 1%) by (ii) a
percentage equal to 100% minus the then stated maximum rate of all reserve
requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) applicable to any member bank of the
Federal Reserve System in respect of Eurocurrency liabilities as defined in
Regulation D (or any successor category of liabilities under Regulation D);
provided that if one or more of the Reference Banks fails to provide the
Administrative Agent with its aforesaid rate, then the Eurodollar Rate in
respect of Loans shall be determined based on the rate or rates provided to the
Administrative Agent by the other Reference Banks or Bank.
"Event of Default" shall have the meaning provided in Section
9.
"Excess Cash Flow" shall mean, for any period, the remainder
of (x) the sum of (i) Consolidated EBITDA for such period and (ii) the decrease,
if any, in Working Capital from the first day to the last day of such period,
minus (y) the sum of (i) the amount of Consolidated Fixed Charges for such
period (but in the case of Consolidated Capital Expenditures included therein,
only to the extent such expenditures are not financed by Indebtedness (other
than Loans hereunder)) and (ii) the increase, if any, in Working Capital from
the first day to the last day of such period, provided that in calculating the
amount referred to in clause (x)(ii) or (y)(ii) above, as the case may be, (A)
for any period during which the Company and/or any of its Restricted
Subsidiaries have consummated an Asset Sale pursuant to Section 8.02(c) or a
Permitted Acquisition, the portion of the change in Working Capital for such
period attributable to the entity or business sold or purchased shall be based
(x) in the case of an Asset Sale, on the change in Working Capital attributable
to the entity or business sold from the first day of such period to the date of
the consummation of such sale and (y) in the case of an acquisition, on the
change in Working Capital attributable to the entity or business acquired from
the date of consummation of such acquisition to the last day of such period and
(B) Working Capital shall only include the assets and liabilities of a
Partially-Owned Restricted Subsidiary to the extent of the percentage equity
interest of the Company in such Partially-Owned Restricted Subsidiary.
"Excess Cash Flow Amount" shall mean an amount which initially
shall be zero and which shall be (i) increased on the date of delivery of
Section 7.01 Financials in respect of the first three fiscal quarters in each
year of the Company (commencing with the fiscal quarter ended June 30, 1996) by
an amount (if positive) equal to 75% of Excess Cash Flow for the fiscal quarter
in respect of which such Section 7.01 Financials are delivered, provided that in
the event that Excess Cash Flow for the first and/or second fiscal quarter in
any fiscal year is negative, then for purposes of this clause (i) the Excess
Cash Flow for the third fiscal quarter in such fiscal year shall be deemed to be
reduced by the amount of such negative Excess Cash Flow for such first and/or
second quarter, and (ii) increased on the date of delivery of Section 7.01
Financials in respect of each fiscal year of the Company by an amount (if
positive) equal to 75% of the Excess Cash Flow for such fiscal year less an
amount (if any) equal to the aggregate amount by which
-75-
the Excess Cash Flow Amount was increased pursuant to clause (i) above in
respect of the first, second and third quarters in such fiscal year.
"Excluded Domestic Restricted Subsidiary" shall mean any
Partially-Owned Restricted Subsidiary with respect to which the Company shall
have made a Non-Guarantor Designation in accordance with the provisions hereof.
"Excluded Foreign Restricted Subsidiaries" shall mean (i)
Daily Racing Form of Canada Ltd., a Canada corporation, (ii) Admirefruit
Limited, a U.K. corporation, (iii) Canadian Red Book, Inc., a Canada
corporation, (iv) the Canadian Borrower and (v) each Restricted Subsidiary of
the Company established, created or acquired after the Original Effective Date
which is incorporated in a jurisdiction outside the United States, except to the
extent the requirements set forth in clause (z) of 8.14(a), and Section 8.14(c),
are satisfied with respect to such Subsidiary.
"Existing Contingent Obligations" shall have the meaning
provided in Section 8.06(g).
"Existing Credit Agreements" shall mean and include each of
the Chase Revolving Credit Facility, the Chase Term Loan Facility and the BONY
Term Loan Facility.
"Existing Debt" shall have the meaning provided in Section
8.04(d).
"Existing Indebtedness Agreements" shall have the meaning
provided in Section 5.01(i).
"Existing Preferred Stock" shall include preferred stock of
the Company issued prior to the Restatement Effective Date and listed on Annex
VI hereto, without giving effect to any extension or replacement thereof, as the
same may be modified, supplemented or amended from time to time pursuant to the
terms hereof and thereof.
"Facing Fee" shall have the meaning provided in Section
3.01(c).
"Federal Funds Effective Rate" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal Funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean (i) all amounts payable pursuant to, or
referred to in, Section 3.01 and (ii) all other fees payable to the
Administrative Agent or any Bank as may be agreed to from time to time between
the Company and the Administrative Agent or such Bank, as the case may be.
-76-
"Final Maturity Date" shall mean July 31, 2004.
"GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect from time to time; it being understood
and agreed that determinations in accordance with GAAP for purposes of Section
8, including defined terms as used therein, are subject (to the extent provided
therein) to Section 12.07(a).
"Guarantor" shall mean the Company and each Subsidiary
Guarantor.
"Guaranty" shall mean the Company Guaranty and the Subsidiary
Guaranty.
"Hazardous Materials" shall mean (a) any petrochemical or
petroleum products, radioactive materials, asbestos in any form that is or could
become friable, urea formaldehyde foam insulation, transformers or other
equipment that contain dielectric fluid containing levels of polychlorinated
biphenyls, and radon gas; and (b) any chemicals, materials or substances defined
as or included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," "restricted hazardous materials," "extremely hazardous
wastes," "restrictive hazardous wastes," "toxic substances," "toxic pollutants,"
"contaminants" or "pollutants," or words of similar import, under any applicable
Environmental Law.
"Indebtedness" of any Person shall mean without duplication
(i) all indebtedness of such Person for borrowed money, (ii) the deferred
purchase price of assets or services payable to the sellers thereof or any of
such seller's assignees which in accordance with GAAP would be shown on the
liability side of the balance sheet of such Person, (iii) the face amount of all
letters of credit issued for the account of such Person and, without
duplication, all drafts drawn thereunder, (iv) all Indebtedness of a second
Person secured by any Lien on any property owned by such first Person, whether
or not such Indebtedness has been assumed, (v) all Capitalized Lease Obligations
of such Person and (vi) all obligations of such Person to pay a specified
purchase price for goods or services whether or not delivered or accepted, i.e.,
take-or-pay and similar obligations, provided that Indebtedness shall not
include (x) trade payables and accrued expenses, in each case arising in the
ordinary course of business and (y) any obligations under Interest Rate
Protection Agreements.
"Information Memorandum" shall mean the Confidential
Information Memorandum dated February, 1999 and distributed to the Banks prior
to the Restatement Effective Date.
"Initial Borrowing Date" shall mean May 31, 1996.
"Initial Tranche B Assumption Date" shall mean the date on
which the first Tranche B Assumption Agreement is delivered to the
Administrative Agent pursuant to Section 1.13 of this Agreement.
"Intellectual Property" shall have the meaning provided in
Section 6.14(b).
"Intercompany Loan" shall have the meaning provided in Section
8.05(c).
-77-
"Interest Period" with respect to any Eurodollar Loan, shall
mean the interest period applicable thereto, as determined pursuant to Section
1.09.
"Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedging agreement or other similar agreement or
arrangement designed to protect the Company or any of its Subsidiaries against
fluctuations in interest rates.
"KKR" shall mean Kohlberg Kravis ▇▇▇▇▇▇▇ & Co., a Delaware
limited partnership.
"Leasehold" of any Person means all of the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Letter of Credit Fee" shall have the meaning provided in
Section 3.01(b).
"Letter of Credit Issuer" shall mean Chase.
"Letter of Credit Outstandings" shall mean, at any time, the
sum of, without duplication, (i) the aggregate Stated Amount of all outstanding
Letters of Credit and (ii) the aggregate amount of all Unpaid Drawings in
respect of all Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in
Section 2.03(a).
"Leverage Ratio" shall have the meaning provided in Section
8.11.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any similar
recording or notice statute, and any lease having substantially the same effect
as the foregoing).
"Loan" shall mean each and every Loan made by any Bank
hereunder, including Term Loans, B Term Loans, Tranche A Revolving Loans,
Tranche B Revolving Loans, Canadian Dollar Loans and Swingline Loans.
"Mandatory Borrowing" shall have the meaning provided in
Section 1.01(e).
"Margin Stock" shall have the meaning provided in Regulation
U.
"Maximum Canadian Dollar Amount" shall mean $40,000,000.
"Maximum Exposure" shall mean, for any period, an amount equal
to the maximum amount of the sum of (i) the principal amount of all outstanding
Revolving Loans, (ii) the principal amount of all outstanding Swingline Loans,
(iii) the Dollar Equivalent of the principal
-78-
amount of all outstanding Canadian Dollar Loans and (iv) the Letter of Credit
Outstandings, at any one time during such period.
"Maximum Swingline Amount" shall mean $40,000,000.
"Minimum Borrowing Amount" shall mean (i) for Term Loans,
$3,000,000; (ii) for B Term Loans, $3,000,000; (iii) for Revolving Loans,
$3,000,000; (iv) for Canadian Dollar Loans, Can. $50,000; and (v) for Swingline
Loans, $500,000.
"Minimum Retention Amount" shall mean, at any time,
$10,000,000 multiplied by a fraction (i) the numerator of which shall be the sum
of the outstanding Term Loans, and B Term Loans plus the Total Revolving Loan
Commitment at such time and (ii) the denominator of which shall be the sum of
$1,250,000,000 plus the Total Tranche B Revolving Loan Commitment at such time.
"Net Cash Proceeds" shall mean, with respect to any Asset
Sale, the Available Cash Proceeds resulting therefrom net of (a) cash expenses
of sale (including payment of principal, premium and interest of Indebtedness
specifically relating to the assets sold in such Asset Sale, relocation expenses
and severance and shutdown costs) and (b) taxes paid or payable as a result
thereof over and above the taxes which would otherwise have been payable in the
absence of such Asset Sale, provided that in the case of an Asset Sale by a
Partially-Owned Restricted Subsidiary, "Net Cash Proceeds" shall be the amount
as determined above in this definition multiplied by the percentage of the
capital stock of such Subsidiary owned, directly or indirectly, by the Company.
"Net Investments in Excluded Foreign Restricted Subsidiaries"
shall mean the remainder of (i) the sum of (x) the aggregate value of all
businesses, properties and assets transferred by the Company and/or its
Restricted Subsidiaries (other than Excluded Foreign Restricted Subsidiaries) to
Excluded Foreign Restricted Subsidiaries after the Original Effective Date, (y)
the aggregate outstanding principal amount of all Intercompany Loans made to
Excluded Foreign Restricted Subsidiaries by the Company and/or its Restricted
Subsidiaries (other than Excluded Foreign Restricted Subsidiaries) after the
Original Effective Date and (z) the aggregate amount of all investments by the
Company and its Restricted Subsidiaries (other than Excluded Foreign Restricted
Subsidiaries) in Excluded Foreign Restricted Subsidiaries after the Original
Effective Date, minus (ii) the sum of (x) the aggregate value of all businesses,
properties and assets transferred by Excluded Foreign Restricted Subsidiaries to
the Company and/or its Restricted Subsidiaries (other than Excluded Foreign
Restricted Subsidiaries) after the Original Effective Date and (y) the aggregate
amount of all cash dividends and other cash distributions on common stock paid
by Excluded Foreign Restricted Subsidiaries to the Company and its Restricted
Subsidiaries (other than Excluded Foreign Restricted Subsidiaries) after the
Original Effective Date.
"Net Maximum Exposure Reduction" shall mean, for any period,
the Maximum Exposure during such period less the sum of (i) the Total Revolving
Loan Commitment on the last day of such period, and (ii) an amount equal to the
aggregate amount of reductions to the
-79-
Total Tranche A Revolving Loan Commitment and the Total Tranche B Revolving Loan
Commitment during such period pursuant to Section 3.03(e).
"1999 Additional Credit Agreement" shall mean the credit
agreement, dated as of March 11, 1999, among the Company, various lending
institutions, The Bank of New York and Bankers Trust Company, as Co-Syndication
Agents, The Bank of Nova Scotia, as Documentation Agent, and The Chase Manhattan
Bank, as Administrative Agent, as amended, modified, supplemented or extended
from time to time in accordance with the terms thereof and hereof.
"1999 Additional Facility Documents" shall mean and include
each of the documents and other agreements entered into by the Company or any of
its Subsidiaries in connection with the 1999 Additional Credit Agreement
(including, without limitation, the 1999 Additional Credit Agreement and any
guaranty or guaranties relating thereto), as in effect on the Restatement
Effective Date and as the same may be modified, supplemented or amended from
time to time pursuant to the terms hereof and thereof.
"Non-Compete Notes" shall mean the promissory notes issued by
K-III Holdings Corporation III pursuant to the Non-Competition Agreement, dated
as of June 17, 1991, among PRIMEDIA Holdings, Inc. (f/k/a K-III Holdings
Corporation III), News America Holdings Incorporated and the other parties
thereto in an aggregate principal amount not to exceed $50,000,000, as such
notes may be amended, supplemented or otherwise modified from time to time in
accordance with the terms thereof.
"Non-Defaulting Bank" shall mean each Bank other than a
Defaulting Bank.
"Non-Facility Letter of Credit Outstandings" shall mean, at
any time, the sum of (i) the aggregate maximum amount available to be drawn
(regardless of whether any conditions for drawing could then be met) under all
outstanding Non-Facility Letters of Credit and (ii) the aggregate amount of all
Non-Facility Unpaid Drawings.
"Non-Facility Letters of Credit" shall mean each letter of
credit (other than any Letter of Credit issued pursuant to this Agreement)
issued for the account of the Company or any of its Restricted Subsidiaries,
provided that the reimbursement obligations of the Company or such Restricted
Subsidiary with respect to such letter of credit may be secured only to the
extent permitted by Section 8.03(q).
"Non-Facility Unpaid Drawings" shall mean all amounts paid or
disbursed by the issuers of Non-Facility Letters of Credit which have not been
reimbursed.
"Non-Guarantor Designation" shall mean and include each of (x)
the designation by the Company of any newly created or acquired Partially-Owned
Restricted Subsidiary and (y) the redesignation of any existing Partially-Owned
Restricted Subsidiary which is a Subsidiary Guarantor, in each case, as an
Excluded Domestic Restricted Subsidiary by delivery of a written notice to the
Administrative Agent of such designation or redesignation, as the case may be;
provided that the Company may only make a Non-Guarantor Designation hereunder
if, at the
-80-
time of such designation (i) no Default or Event of Default exists or would
result therefrom and (ii) the Company shall have determined, with respect to
such designation, that the Company and its Restricted Subsidiaries would have
been in compliance, on a Pro Forma Basis, with Sections 8.09, 8.10 and 8.11 of
this Agreement.
"Note" shall mean and include each promissory note, in the
form agreed by the Company and the Administrative Agent prior to the Original
Effective Date (or, in the case of B Term Loans, prior to the Restatement
Effective Date), to the extent issued pursuant to Section 1.05(b) hereof.
"Notice of Borrowing" shall have the meaning provided in
Section 1.03(a).
"Notice of Conversion" shall have the meaning provided in
Section 1.06.
"Notice Office" shall mean the office of the Administrative
Agent at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other office as the
Administrative Agent may designate to the Company and the Banks from time to
time.
"Obligations" shall mean all amounts, direct or indirect,
contingent or absolute, of every type or description, and at any time existing,
owing to the Administrative Agent or any Bank pursuant to the terms of this
Agreement or any other Credit Document.
"Original Credit Agreement" shall have the meaning provided in
the first Whereas clause of this Agreement.
"Original Effective Date" shall mean May 28, 1996.
"Original Final Maturity Date" shall mean June 30, 2004.
"Partially-Owned Restricted Subsidiary" shall mean any
Restricted Subsidiary of the Company to the extent that the Company and its
Wholly-Owned Restricted Subsidiaries shall own less than 100% of the capital
stock of such Restricted Subsidiary.
"Participant" shall have the meaning provided in Section
2.05(a).
"Payment Office" shall mean the office of the Administrative
Agent at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other office as the
Administrative Agent may designate to the Company and the Banks from time to
time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquisition" shall have the meaning provided in
Section 8.02(g).
"Permitted Amendments" shall mean, to any amendment or
supplement to or waiver of the documents governing or evidencing (x) any issue
of Indebtedness which does not (i) add, directly or indirectly, any new
covenant, event of default, collateral requirement or repay-
-81-
ment requirement (including pursuant to any put arrangement), (ii) modify in any
manner materially adverse to the issuer or guarantors thereof any existing
covenant, event of default, collateral requirement or repayment requirement
(including any shortening or any amortization requirements), (iii) increase the
interest rate thereon or modify in any manner the time or manner of payment of
such interest (including any option or right to pay such interest in kind), (iv)
modify any of the subordination provisions or (v) contain any provision which,
in the opinion of the Administrative Agent, is materially adverse to the
interests of the Banks, (y) any issue of Preferred Stock which does not (i) add,
directly or indirectly, any new covenant, default, voting, redemption, exchange
or put provision, (ii) modify in any manner adverse to the issuer thereof any
existing covenant, default, voting, redemption, exchange or put provision, (iii)
increase the dividend rate thereon or modify in any manner the time or manner of
payment of such dividends (including any option or right to pay such dividends
in kind) or (iv) contain any provision which, in the opinion of the
Administrative Agent, is materially adverse to the interests of the Banks or (z)
the sole effect of which is to (i) delete covenants or events of default and/or
(ii) add to, or increase existing, exceptions to the covenants contained
therein, or waive any of the covenants contained therein or any rights of the
holders of such Indebtedness or Preferred Stock, as the case may be, set forth
therein.
"Permitted Liens" shall have the meaning provided in Section
8.03(c).
"Permitted Refinancing Debt" shall mean Indebtedness issued in
connection with a refinancing of any or all of the Existing Debt, the
Subordinated Exchange Debentures, any Additional Indebtedness or any other
Permitted Refinancing Debt; provided that (i) such Indebtedness has a longer
average life than the Indebtedness being refinanced and (ii) such Indebtedness,
and the agreements and other documents entered into by the Company and/or any of
its Restricted Subsidiaries in connection therewith shall contain terms and
conditions (including, without limitation, with respect to the obligor and
guarantors, if any, in respect of such Indebtedness, amortization schedules,
interest rates, redemption provisions, covenants, defaults, security, remedies
and, if the Indebtedness so refinanced is subordinated to any other Indebtedness
of the Company or its Restricted Subsidiaries, subordination provisions) not
materially less favorable to the Company and its Restricted Subsidiaries or to
the Banks than the terms and conditions of the Indebtedness so refinanced
(excluding, for purposes of this clause (ii), the impact of market conditions on
the interest rate and other economic terms).
"Permitted Replacement Preferred Stock" shall mean preferred
stock of the Company issued in connection with the replacement and cancellation
of any outstanding Preferred Stock; provided that such preferred stock and the
agreements, certificates of designation and other documents entered into by the
Company in connection therewith shall contain terms and conditions (including,
without limitation, dividend rates, pay-in-kind features, redemption provisions,
put rights, liquidation preferences, voting rights and exchange rights) not
materially less favorable to the Company or to the Banks than the terms and
conditions of the preferred stock being replaced (excluding the impact of market
conditions on the dividend rate and other economic terms), as such preferred
stock may be amended, modified or supplemented from time to time in accordance
with the terms hereof and thereof.
-82-
"Permitted Restricted Asset Sale" shall mean any sale,
transfer or other disposition by the Company or any of its Restricted
Subsidiaries (other than the Canadian Borrower) to any Unrestricted Subsidiary
of any asset (including, without limitation, any capital stock or other
securities of another Person, but excluding any sale, transfer or other
disposition by the Company of its capital stock) of the Company or such
Restricted Subsidiary; provided that the Company or such Restricted Subsidiary
shall only be permitted to effectuate a Permitted Restricted Asset Sale so long
as (i) no Default or Event of Default exists or would result therefrom, (ii) the
Company shall have delivered to the Administrative Agent the opinion of value of
an Appraisal Firm to the extent required by Section 8.02(c) and (iii) the
Company shall have, or shall have caused such Restricted Subsidiary to have,
complied with the other terms and conditions of Section 8.02(c) or (j), as the
case may be.
"Permitted Restricted Subsidiary Conversion" shall mean the
redesignation by the Company of a Restricted Subsidiary (other than the Canadian
Borrower) of the Company as an Unrestricted Subsidiary of the Company pursuant
to a written notice to the Administrative Agent and the Banks; provided that any
such redesignation of a Restricted Subsidiary as an Unrestricted Subsidiary
shall be deemed to constitute a sale of all of the assets of the respective
Restricted Subsidiary for all purposes of this Agreement; provided further, that
the Company shall only be permitted to effectuate a Permitted Restricted
Subsidiary Conversion so long as (i) no Default or Event of Default exists or
would result therefrom, (ii) the Company shall have delivered to the
Administrative Agent the opinion of value of management of the Company or, to
the extent required by Section 8.02(c), the Appraisal Firm required by such
Section (the value set forth in any such opinion, the "Conversion Value
Amount"), (iii) the Company shall have complied with the other terms and
conditions of Section 8.02(c) or (j), as the case may be, (iv) the Aggregate
Conversion Amount at such time, when added to the Unrestricted Subsidiary
Investment Amount at such time shall not exceed the Unrestricted Subsidiary
Investment Limit then in effect, and (v) the Company shall have determined, with
respect to such conversion, that the Company and its Restricted Subsidiaries
would have been in compliance, on a Pro Forma Basis, with Sections 8.09, 8.10
and 8.11 of this Agreement.
"Person" shall mean any individual, partnership, joint
venture, firm, corporation, association, trust or other enterprise or any
government or political subdivision or any agency, department or instrumentality
thereof.
"Plan" shall mean any multiemployer or single-employer plan,
as defined in Section 4001 of ERISA, which is maintained or contributed to by
(or to which there is an obligation to contribute of) the Company, any
Restricted Subsidiary or an ERISA Affiliate, and each such plan for the five
year period immediately following the latest date on which the Company, any
Restricted Subsidiary or an ERISA Affiliate maintained, contributed to or had an
obligation to contribute to such plan.
"Preferred Stock" shall mean and include the Existing
Preferred Stock and, once issued, any Additional Preferred Stock and any
Permitted Replacement Preferred Stock.
-83-
"Prescribed Forms" shall mean such duly executed form(s) or
statement(s), and in such number of copies, which may, from time to time, be
prescribed by law and which, pursuant to applicable provisions of (a) an income
tax treaty between the United States and the country of residence of the Bank
providing the form(s) or statement(s), (b) the Code, or (c) any applicable rule
or regulation under the Code, permit the Company to make payments hereunder for
the account of such Bank free of deduction or withholding of income or similar
taxes.
"Prime Lending Rate" shall mean the rate which the
Administrative Agent announces from time to time as its prime commercial lending
rate, the Prime Lending Rate to change when and as such prime commercial lending
rate changes. The Prime Lending Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer.
The Administrative Agent may make commercial loans or other loans at rates of
interest at, above or below the Prime Lending Rate.
"Pro Forma Basis" shall mean, with respect to each Affected
Transaction in connection with which any calculation of compliance with any
financial covenant or financial term is required, the calculation thereof on a
pro forma basis, for the Test Period ended on the last day of the most recently
ended fiscal quarter, determined as if (x) such Affected Transaction, each other
Affected Transaction effected by Company during the Affected Period and any
reduction of Consolidated Debt during such Affected Period effected with the
proceeds received by the Company and/or its Restricted Subsidiaries of (A) the
issuance of common equity by the Company or (B) the sale of the capital stock or
other ownership interest of the Company in an Unrestricted Subsidiary (to the
extent not otherwise included in Consolidated EBITDA), in each case, had
occurred on the first day of such Affected Period, and (y) with respect to any
Affected Transaction involving the issuance of Indebtedness or Preferred Stock,
such Indebtedness and/or Preferred Stock had remained outstanding at all times
during such Affected Period.
"Pro Rata Share" shall mean, for each Bank, (i) with respect
to Term Loans, the percentage obtained by dividing such Bank's outstanding Term
Loans (if any) by the aggregate of all outstanding Term Loans, (ii) with respect
to B Term Loans, the percentage obtained by dividing such Bank's outstanding B
Term Loans (if any) by the aggregate of all outstanding B Term Loans, (iii) with
respect to Tranche A Revolving Loans, the percentage obtained by dividing such
Bank's Tranche A Revolving Loan Commitment (if any) by the Total Tranche A
Revolving Loan Commitment and (iv) with respect to Tranche B Revolving Loans,
the percentage obtained by dividing such Bank's Tranche B Revolving Loan
Commitment (if any) by the Total Tranche B Revolving Loan Commitment; provided
that, if at any time of the determination of a Bank's "Pro Rata Share," any
Commitments under a Tranche under this Agreement shall have been terminated, Pro
Rata Share shall be calculated with reference to the amount of Loans outstanding
under such Tranche rather than such Commitments.
"Real Property" of any Person shall mean all of the right,
title and interest of such Person in and to land, improvements and fixtures,
including Leaseholds.
"Reference Banks" shall mean Chase, The Bank of New York and
Bankers Trust Company.
-84-
"Register" shall have the meaning provided in Section 1.05(a).
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.
"Regulation U" shall mean Regulation U of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.
"Remaining Net Cash Proceeds" shall mean, with respect to any
Asset Sale, at any time, an amount equal to the Net Cash Proceeds from such
Asset Sale theretofore received by the Company and/or its Restricted
Subsidiaries minus the portion, if any, of such Net Cash Proceeds theretofore
expended by the Company or any of its Restricted Subsidiaries in furtherance of
the purchase, construction or other acquisition of assets to be employed in,
and/or the capital stock of any Person engaged in, the Business.
"Replaced Bank" shall have the meaning provided in Section
1.10(c)(ii).
"Replacement Bank" shall have the meaning provided in Section
1.10(c)(ii).
"Replacement Canadian Parent" shall have the meaning provided
in Section 7.11.
"Reportable Event" shall mean an event described in Section
4043(c) of ERISA with respect to a Plan other than those events as to which the
30-day notice is waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC
Regulation Section 2615.
"Required Banks" shall mean Non-Defaulting Banks whose
outstanding (a) Term Loans (or, if prior to the Initial Borrowing Date, Term
Loan Commitments), (b) B Term Loans and (c) outstanding Revolving Loan
Commitments (or, if after the Total Revolving Loan Commitment has been
terminated, outstanding Revolving Loans and Adjusted Percentages of Swingline
Loans, Dollar Equivalent of Canadian Dollar Loans and Letter of Credit
Outstandings) constitute at least 51% of the sum of (i) all outstanding Term
Loans (or, if prior to the Initial Borrowing Date, Term Loan Commitments) of
Non-Defaulting Banks plus (ii) all outstanding B Term Loans of Non-Defaulting
Banks plus (iii) the Adjusted Total Tranche A Commitment plus (iv) the Total
Tranche B Revolving Loan Commitment less the Tranche B Revolving Loan
Commitments of all Defaulting Banks (or, if after the Total Revolving Loan
Commitment has been terminated, the total outstanding Revolving Loans of
Non-Defaulting Banks and the aggregate Adjusted Percentages of all
Non-Defaulting Banks of the total outstanding Swingline Loans, Dollar Equivalent
of Canadian Dollar Loans and Letter of Credit Outstandings at such time).
"Restatement Effective Date" shall have the meaning provided
in Section 12.10.
"Restricted Subsidiaries" shall mean (x) all of the
Subsidiaries of the Company in existence on the Original Effective Date,
including, without limitation, the Canadian Borrower, (y) any Subsidiary owned
(directly or indirectly) by the Company that is created, established or
-85-
acquired after the Original Effective Date and which does not constitute an
Unrestricted Subsidiary on the date of the creation, establishment and/or
acquisition thereof and (z) any Unrestricted Subsidiary of the Company to the
extent designated by the Company as a Restricted Subsidiary hereunder by written
notice to the Administrative Agent; provided that the Company shall only be
permitted to so designate a new Restricted Subsidiary so long as (i) no Default
or Event of Default exists or would result therefrom, (ii) at least 51% of the
capital stock of such newly-designated Restricted Subsidiary is owned by the
Company or one or more Wholly-Owned Restricted Subsidiaries and all of the
applicable provisions of Section 8.14 shall have been complied with in respect
of such newly-designated Restricted Subsidiary, (iii) the Company shall have
determined, with respect to such designation, that the Company and its
Restricted Subsidiaries would have been in compliance, on a Pro Forma Basis,
with Sections 8.09, 8.10 and 8.11 of this Agreement and (iv) such Unrestricted
Subsidiary is permitted to be designated a Restricted Subsidiary pursuant to the
Senior Note Documents; provided further, that, at the time of any Permitted
Restricted Subsidiary Conversion or the sale of 100% of the capital stock owned
by the Company or any Restricted Subsidiary of a Restricted Subsidiary to an
Unrestricted Subsidiary pursuant to a Permitted Restricted Asset Sale, the
Restricted Subsidiary so converted or sold shall no longer constitute a
Restricted Subsidiary hereunder.
"Revolving Loan" shall have the meaning provided in Section
1.01(c).
"Revolving Loan Commitment" shall mean each Tranche A
Revolving Loan Commitment and each Tranche B Revolving Loan Commitment with the
Revolving Loan Commitment of any Bank at any time to equal the sum of its
Tranche A Revolving Loan Commitment and Tranche B Revolving Loan Commitment at
such time.
"Scheduled A Commitment Reduction" shall have the meaning
provided in Section 3.03(b).
"Scheduled A Commitment Reduction Date" shall have the meaning
provided in Section 3.03(b).
"Scheduled B Commitment Reduction" shall have the meaning
provided in Section 3.03(c).
"Scheduled B Commitment Reduction Date" shall have the meaning
provided in Section 3.03(c).
"Scheduled BTL Repayment" shall have the meaning provided in
Section 4.02(g).
"Scheduled BTL Repayment Date" shall have the meaning provided
in Section 4.02(g).
"Scheduled TL Repayment" shall have the meaning provided in
Section 4.02(c).
"Scheduled TL Repayment Date" shall have the meaning provided
in Section 4.02(c).
-86-
"SEC" shall mean the Securities and Exchange Commission or any
successor thereto.
"Section 7.01 Financials" shall mean the financial statements
delivered, or to be delivered, pursuant to Section 7.01(a) or (b).
"Senior Note Documents" shall mean and include each of the
documents and other agreements entered into by the Company or any of its
Subsidiaries (including, without limitation, the indentures pursuant to which
each issuance of the Senior Notes are issued and any guaranty or guaranties
relating thereto) relating to the issuance by the Company of any Senior Notes,
as in effect on the Initial Borrowing Date and as the same may be modified,
supplemented or amended from time to time pursuant to the terms hereof and
thereof.
"Senior Notes" shall mean and include the Company's (x) 7-5/8%
Senior Secured Notes due 2008, (y) 10-1/4% Senior Notes due 2004 and (z) 8-1/2%
Senior Notes due 2006, in each case, as in effect on the Restatement Effective
Date and as the same may be modified, supplemented or amended from time to time
pursuant to the terms hereof and thereof.
"Senior Preferred Stock" shall mean the Company's $2.875
Senior Exchangeable Preferred Stock, as in effect on the Initial Borrowing Date
and as the same may be modified, supplemented or amended from time to time
pursuant to the terms hereof and thereof.
"Series B Preferred Stock" shall mean the Company's $11.625
Series B Exchangeable Preferred Stock, as in effect on the Initial Borrowing
Date and as the same may be modified, supplemented or amended from time to time
pursuant to the terms hereof and thereof.
"Series C Preferred Stock" shall mean the Company's Series C
Exchangeable Preferred Stock, as in effect on the Initial Borrowing Date and as
the same may be modified, supplemented or amended from time to time pursuant to
the terms hereof and thereof.
"Shareholders Agreement" shall mean the Shareholders
Agreement, dated as of March 9, 1994 among all holders of the capital stock of
the Canadian Borrower, as amended to the Initial Borrowing Date and as further
amended, modified or supplemented from time to time in accordance with the terms
hereof and thereof.
"Specified Change of Control Event" shall mean a Change of
Control Event of the type described in clause (a) of the definition thereof.
"Stated Amount" of each Letter of Credit shall mean the
maximum amount available to be drawn thereunder (regardless of whether any
conditions for drawing could then be met).
"Subordinated Exchange Debentures" shall mean and include the
Company's (x) 11-1/2% Subordinated Debentures due 2004, (y) 11-5/8% Class B
Subordinated Exchange Debentures due 2005 and (z) 10% Subordinated Exchange
Debentures due 2008, in each case, in
-87-
the form delivered to the Banks on the Initial Borrowing Date and as the same
may be modified, supplemented or amended from time to time pursuant to the terms
hereof and thereof.
"Subsidiary" of any Person shall mean and include (i) any
corporation more than 50% of whose stock of any class or classes having by the
terms thereof ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time stock of any class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency) is at the time owned by such Person directly
or indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time, provided that the
Canadian Borrower shall be deemed to be a Subsidiary of the Company for all
purposes.
"Subsidiary Guarantor" shall mean (i) each Restricted
Subsidiary in existence on the Initial Borrowing Date (other than Excluded
Foreign Restricted Subsidiaries) and (ii) each Restricted Subsidiary of the
Company formed after the Initial Borrowing Date and each Excluded Domestic
Restricted Subsidiary designated as such by the Company, in each case, which has
executed and delivered a counterpart of the Subsidiary Guaranty to the
Administrative Agent on behalf of the Banks, provided that any such Restricted
Subsidiary which is a Partially-Owned Restricted Subsidiary shall cease to
constitute a Subsidiary Guarantor to the extent the Company shall have made a
Non-Guarantor Designation with respect to such Subsidiary in accordance with the
terms hereof.
"Subsidiary Guaranty" shall have the meaning provided in
Section 5.01(e)(i).
"Swingline Expiry Date" shall mean the date which is five
Business Days prior to the Original Final Maturity Date.
"Swingline Loan" shall have the meaning provided in Section
1.01(d).
"Taxes" shall have the meaning provided in Section 4.04.
"Term Loan" shall have the meaning provided in Section
1.01(a).
"Term Loan Commitment" shall mean, with respect to each Bank,
the amount set forth opposite such Bank's name in Annex I hereto directly below
the column entitled "Term Loan Commitment," as same may be reduced from time to
time pursuant to Sections 3.03 and/or 9.
"Term Loan Facility Percentage" shall mean, at any time, a
fraction (expressed as a percentage) the numerator of which is equal to the
aggregate principal amount of all Term Loans outstanding at such time and the
denominator of which is equal to the sum of (w) the Total Tranche A Revolving
Loan Commitment at such time, (x) the Total Tranche B Revolving Loan Commitment
at such time, (y) the aggregate principal amount of Term Loans then outstanding
and (z) the Additional Facility Amount at such time; provided that if at any
time of the determination of Term Loan Facility Percentage, the Total Tranche A
Revolving Loan Commitment
-88-
and/or the Total Tranche B Revolving Loan Commitment shall have terminated, the
Term Loan Facility Percentage shall be calculated based upon the aggregate
principal amount of Tranche A Revolving Loans or Tranche B Revolving Loans, as
the case may be, then outstanding.
"Test Period" shall mean the four consecutive fiscal quarters
of the Company then last ended.
"Total B Term Loan Commitment" shall mean, at any time, the
sum of the B Term Loan Commitments of each of the Banks.
"Total Commitment" shall mean, at any time, the sum of the
Commitments of each of the Banks.
"Total Revolving Loan Commitment" shall mean, at any time, the
sum of the Total Tranche A Revolving Loan Commitment and the Total Tranche B
Revolving Loan Commitment.
"Total Term Loan Commitment" shall mean, at any time, the sum
of the Term Loan Commitments of each of the Banks.
"Total Tranche A Revolving Loan Commitment" shall mean, at any
time, the sum of the Tranche A Revolving Loan Commitments of each of the Banks.
"Total Tranche B Revolving Loan Commitment" shall mean, at any
time, the sum of the Tranche B Revolving Loan Commitments of each of the Banks.
"Total Unutilized Tranche A Revolving Loan Commitment" shall
mean, at any time, (i) the Total Tranche A Revolving Loan Commitment at such
time less (ii) the sum of the aggregate principal amount of all Tranche A
Revolving Loans and Swingline Loans at such time, the Dollar Equivalent of the
aggregate principal amount of Canadian Dollar Loans at such time plus the Letter
of Credit Outstandings at such time.
"Total Unutilized Tranche B Revolving Loan Commitment" shall
mean, at any time, the Total Tranche B Revolving Loan Commitment at such time
less the aggregate principal amount of all Tranche B Revolving Loans at such
time.
"Tranche" shall mean the respective facility and commitments
utilized in making Loans hereunder, with there being six separate Tranches,
i.e., the Term Loans, the B Term Loans, the Tranche A Revolving Loans, the
Tranche B Revolving Loans, the Swingline Loans and the Canadian Dollar Loans.
0
"Tranche A Facility Percentage" shall mean, at any time, a
fraction (expressed as a percentage) the numerator of which is the Total Tranche
A Revolving Loan Commitment at such time and the denominator of which is equal
to the sum of (w) the Total Tranche A Revolving Loan Commitment at such time,
(x) the Total Tranche B Revolving Loan Commitment at such time, (y) the
aggregate principal amount of Term Loans then outstanding
-89-
and (z) the Additional Facility Amount at such time; provided that if at any
time of the determination of Tranche A Facility Percentage, the Total Tranche A
Revolving Loan Commitment and/or the Total Tranche B Revolving Loan Commitment
shall have terminated, Tranche A Facility Percentage shall be calculated based
upon the aggregate principal amount of Tranche A Revolving Loans or Tranche B
Revolving Loans, as the case may be, then outstanding.
"Tranche A Percentage" shall mean at any time for each Bank
the percentage obtained by dividing such Bank's Tranche A Revolving Loan
Commitment (if any) by the Total Tranche A Revolving Loan Commitment; provided
that at any time when the Total Tranche A Revolving Loan Commitment shall have
been terminated, each Bank's Tranche A Percentage shall be the percentage
obtained by dividing such Bank's Tranche A Revolving Loan Commitment (if any)
immediately prior to such termination by the Total Tranche A Revolving Loan
Commitment immediately prior to such termination.
"Tranche A Revolving Loan" shall have the meaning provided in
Section 1.01(b).
"Tranche B Assumption Agreement" shall mean and include each
Tranche B Assumption Agreement in the form of Exhibit B attached hereto executed
in accordance with Section 1.13 hereof.
"Tranche A Revolving Loan Commitment" shall mean, with respect
to each Bank, the amount set forth opposite such Bank's name in Annex I hereto
directly below the column entitled "Tranche A Revolving Loan Commitment", as
same may be reduced from time to time pursuant to Sections 3.02, 3.03 and/or 9.
"Tranche B Assumption Date" shall mean and include the Initial
Tranche B Assumption Date and each Additional Tranche B Assumption Date.
"Tranche B Facility Percentage" shall mean, at any time, a
fraction (expressed as a percentage) the numerator of which is the Total Tranche
B Revolving Loan Commitment at such time and the denominator of which is equal
to the sum of (w) the Total Tranche A Revolving Loan Commitment at such time,
(x) the Total Tranche B Revolving Loan Commitment at such time, (y) the
aggregate principal amount of Term Loans then outstanding and (z) the Additional
Facility Amount at such time; provided that if at any time of the determination
of Tranche B Facility Percentage, the Total Tranche A Revolving Loan Commitment
and/or the Total Tranche B Revolving Loan Commitment shall have terminated,
Tranche B Facility Percentage shall be calculated based upon the aggregate
principal amount of Tranche A Revolving Loans or Tranche B Revolving Loans, as
the case may be, then outstanding.
"Tranche B Revolving Loan" shall have the meaning provided in
Section 1.01(c).
"Tranche B Revolving Loan Commitment" shall mean, with respect
to each Bank, initially zero, as same may be increased from time to time
pursuant to Section 1.13 and reduced from time to time pursuant to Sections
3.02, 3.03 and/or 9.
-90-
"Type" shall mean any type of Loan determined with respect to
the interest option applicable thereto, i.e., a Base Rate Loan or Eurodollar
Loan.
"UCC" shall mean the Uniform Commercial Code as in effect in
the State of New York.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the actuarial present value of the accumulated plan
benefits under such Plan as of the close of its most recent plan year exceeds
the fair market value of the assets allocable thereto, each determined in
accordance with Statement of Financial Accounting Standards No. 87, based upon
the actuarial assumptions used by the Plan's actuary in the most recent annual
valuation of the Plan.
"Unpaid Drawing" shall have the meaning provided in Section
2.04(a).
"Unrestricted Subsidiary" shall mean (i) any Subsidiary of the
Company that is formed or acquired after the Original Effective Date, which is
funded through loans, advances and/ or capital contributions as permitted by,
and in compliance with, Section 8.05(d), provided that at the time of the
initial loan, advance or capital contribution by the Company or any Restricted
Subsidiary to such Subsidiary (x) the Company designates such Subsidiary as an
Unrestricted Subsidiary in a written notice to the Administrative Agent and (y)
such Subsidiary and the Company shall have entered into a tax sharing agreement
in form and substance reasonably satisfactory to the Required Banks, (ii) any
Restricted Subsidiary of the Company redesignated as an Unrestricted Subsidiary
pursuant to a Permitted Restricted Subsidiary Conversion and any Restricted
Subsidiary sold to an Unrestricted Subsidiary pursuant to a Permitted Restricted
Asset Sale, in each case to the extent consummated in accordance with the terms
of the respective definitions thereof and Section 8.02(c) or 8.02(j), as the
case may be, and (iii) each Subsidiary of an Unrestricted Subsidiary; provided
that, at the time of any designation of the type described in clause (z) of the
definition of "Restricted Subsidiary," the Subsidiary so designated shall no
longer constitute an Unrestricted Subsidiary hereunder.
-91-
"Unrestricted Subsidiary Investment Amount" shall have the
meaning provided in Section 8.05(d).
"Unrestricted Subsidiary Investment Limit" shall mean, at any
time, the sum of (i) $200,000,000, (ii) the Excess Cash Flow Amount at such
time, (iii) an amount equal to all cash or other payments received by the
Company and its Restricted Subsidiaries from Unrestricted Subsidiaries from
dividends or distributions after the Original Effective Date (provided that for
purposes of this clause (iii), cash and other payments received by a
Partially-Owned Restricted Subsidiary shall be added to the Unrestricted
Subsidiary Investment Limit only to the extent of the equity percentage
ownership of the Company in such Partially-Owned Restricted Subsidiary), plus
(iv) an amount equal to the aggregate net proceeds received by the Company from
the issuance of equity securities of the Company after the Original Effective
Date, provided that if the net proceeds from any such equity issuance are not
utilized to make a loan or advance to, or a cash capital contribution in, an
Unrestricted Subsidiary pursuant to Section 8.05(d) within 30 days following the
date of such equity issuance, then the net proceeds from such equity issuance
shall no longer be added to the Unrestricted Subsidiary Investment Limit.
"U.S. Dollars" and "$" shall mean freely transferable lawful
money of the United States of America.
"Voting Trust Agreement" shall mean the Voting Trust
Agreement, dated as of March 9, 1994 among all holders of the capital stock of
the Canadian Borrower, as amended to the Initial Borrowing Date and as further
amended, modified or supplemented from time to time in accordance with the terms
hereof and thereof.
"Wholly-Owned Restricted Subsidiary" shall mean any Restricted
Subsidiary of the Company which is not a Partially-Owned Restricted Subsidiary.
"Working Capital" shall mean the excess of Consolidated
Current Assets over Consolidated Current Liabilities.
"Written" or "in writing" shall mean any form of written
communication or a communication by means of telex, telecopier device, telegraph
or cable.
SECTION 11. The Administrative Agent.
11.01 Appointment. Each Bank hereby irrevocably designates and
appoints Chase as Administrative Agent of such Bank and to act as specified
herein and in the other Credit Documents, and each such Bank hereby irrevocably
authorizes Chase as the Administrative Agent for such Bank, to take such action
on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent agrees to act as such upon the
express conditions contained in this Section 11. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein or
in the other Credit Documents, or any fiduciary relationship with any Bank, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent. The provisions of this Section 11 are solely for the
benefit of the Administrative Agent and the Banks, and neither the Company nor
any of its Subsidiaries shall have any rights as a third party beneficiary of
any of the provisions hereof. In performing its functions and duties under this
Agreement, the Administrative Agent shall act solely as agent of the Banks and
the Administrative Agent neither assumes and nor shall it be deemed to have
assumed any obligation or relationship of agency or trust with or for the
Company or any of its Subsidiaries.
11.02 Delegation of Duties. The Administrative Agent may
execute any of its duties under this Agreement or any other Credit Document by
or through agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise required by Section 11.03.
-92-
11.03 Exculpatory Provisions. Neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or the
other Credit Documents (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Banks for
any recitals, statements, representations or warranties made by the Company, any
of its Subsidiaries or any of their respective officers contained in this
Agreement or the other Credit Documents or in any certificate, report, statement
or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or any other
Credit Document or for any failure of the Company or any of its Subsidiaries or
any of their respective officers to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be under any obligation to any
Bank to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or the other
Credit Documents, or to inspect the properties, books or records of the Company
or any of its Subsidiaries. The Administrative Agent shall not be responsible to
any Bank for the effectiveness, genuineness, validity, enforceability,
collectibility or sufficiency of this Agreement or any other Credit Document or
for any representations, warranties, recitals or statements made herein or
therein or made in any written or oral statement or in any financial or other
statements, instruments, reports, certificates or any other documents in
connection herewith or therewith furnished or made by the Administrative Agent
to the Banks or by or on behalf of either Borrower to the Administrative Agent,
or any Bank or be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained herein or therein or as to the use of the proceeds of the Loans or of
the existence or possible existence of any Default or Event of Default.
11.04 Reliance by Administrative Agent. The Administrative
Agent shall be entitled to rely, and shall be fully protected in relying, upon
any note, writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon advice
and statements of legal counsel (including, without limitation, counsel to the
Company), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Credit
Document unless it shall first receive such advice or concurrence of the
Required Banks as it deems appropriate or it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Credit Documents in
accordance with a request of the Required Banks, and such request and any action
taken or failure to act pursuant thereto shall be binding upon all the Banks.
11.05 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has actually received notice
from a Bank or the Company referring to this Agreement, describing such Default
or Event of Default and stating that such notice is a "notice
-93-
of default." In the event that the Administrative Agent receives such a notice,
the Administrative Agent shall give prompt notice thereof to the Banks. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Banks; provided
that, unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable in the best interests of the Banks.
11.06 Non-Reliance on Administrative Agent and Other Banks.
Each Bank expressly acknowledges that neither the Administrative Agent nor any
of its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates have made any representations or warranties to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Company or any of its Subsidiaries, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Bank. Each Bank
represents to the Administrative Agent that it has, independently and without
reliance upon the Administrative Agent or any other Bank, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other condition, prospects and creditworthiness of the Company and its
Subsidiaries and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Bank also represents that it will, independently and
without reliance upon the Administrative Agent or any other Bank, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement, and to make such investigation as it
deems necessary to inform itself as to the business, assets, operations,
property, financial and other condition, prospects and creditworthiness of the
Company and its Subsidiaries. The Administrative Agent shall not have any duty
or responsibility to provide any Bank with any credit or other information
concerning the business, operations, assets, property, financial and other
condition, prospects or creditworthiness of the Company or any of its
Subsidiaries which may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
11.07 Indemnification. The Banks agree to indemnify the
Administrative Agent in its capacity as such ratably according to their
respective "percentages" (which shall equal, for each Non-Defaulting Bank, that
percentage determined by dividing (i) the sum of (x) such Bank's Tranche A
Revolving Loan Commitment, (y) such Bank's Tranche B Revolving Loan Commitment
and (z) the outstanding principal amount of such Bank's Term Loans and B Term
Loans by (ii) the sum of (x) the Adjusted Total Tranche A Commitment, (y) the
Total Tranche B Revolving Loan Commitment less the Tranche B Revolving Loan
Commitment of each Defaulting Bank and (z) the total aggregate principal amount
of Term Loans and B Term Loans less any outstanding Term Loans and B Term Loans
of Defaulting Banks, it being understood and agreed that references herein to
Tranche A Revolving Loan Commitments and Tranche B Revolving Loan Commitments
(as well as to the Adjusted Total Tranche A Commitment and Total Tranche B
Revolving Loan Commitment) at a time when any such Commitment has been
terminated shall be references to such terminated Commitment as in effect
immediately prior to such termination), from and against any and all
liabilities, obligations, losses, damages, penalties,
-94-
actions, judgments, suits, costs, reasonable expenses or disbursements of any
kind whatsoever which may at any time (including, without limitation, at any
time following the payment of the Obligations) be imposed on, incurred by or
asserted against the Administrative Agent in its capacity as such in any way
relating to or arising out of this Agreement or any other Credit Document, or
any documents contemplated by or referred to herein or the transactions
contemplated hereby or any action taken or omitted to be taken by the
Administrative Agent under or in connection with any of the foregoing, but only
to the extent that any of the foregoing is not paid by the Company or any of its
Subsidiaries; provided that no Bank shall be liable to the Administrative Agent
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the gross negligence or willful misconduct of the Administrative
Agent. If and to the extent any amount paid to the Administrative Agent is
subsequently recovered by the Administrative Agent against the Company or any of
its Subsidiaries, the Administrative Agent shall promptly pay to each Bank to
the extent such Bank paid the Administrative Agent, its "percentage" of the
amount so recovered. If any indemnity furnished to the Administrative Agent for
any purpose shall, in the opinion of the Administrative Agent be insufficient or
become impaired, the Administrative Agent may call for additional indemnity and
cease, or not commence, to do the acts indemnified against until such additional
indemnity is furnished. The agreements in this Section 11.07 shall survive the
payment of all Obligations.
11.08 Administrative Agent in Its Individual Capacity. The
Administrative Agent and its respective affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Company and
its Subsidiaries as though the Administrative Agent were not the Administrative
Agent hereunder. With respect to the Loans made by it and all Obligations owing
to it, the Administrative Agent shall have the same rights and powers under this
Agreement as any Bank and may exercise the same as though it were not the
Administrative Agent, and the terms "Bank" and "Banks" shall include the
Administrative Agent in its individual capacity.
11.09 Holders. The Administrative Agent may deem and treat the
payee of any Note which has been issued hereunder as the owner thereof for all
purposes hereof unless and until a written notice of the assignment, transfer or
endorsement thereof, as the case may be, shall have been filed with the
Administrative Agent. Any request, authority or consent of any Person or entity
who, at the time of making such request or giving such authority or consent, is
the holder of any such Note shall be conclusive and binding on any subsequent
holder, transferee, assignee or indorsee, as the case may be, of such Note or of
any Note or Notes issued in exchange therefor.
11.10 Resignation of the Administrative Agent; Successor
Agent. The Administrative Agent may resign as the Administrative Agent upon 20
days' notice to the Banks. Upon the resignation of the Administrative Agent, the
Required Banks shall appoint from among the Banks a successor Administrative
Agent for the Banks subject to prior approval by the Company (such approval not
to be unreasonably withheld), whereupon such successor agent shall succeed to
the rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall include such successor agent effective upon its
appointment, and the resigning
-95-
Administrative Agent's rights, powers and duties as the Administrative Agent
shall be terminated, without any other or further act or deed on the part of
such former Administrative Agent or any of the parties to this Agreement. After
the resignation of the Administrative Agent hereunder, the provisions of this
Section 11 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.
SECTION 12. Miscellaneous.
12.01 Payment of Expenses, etc. The Company agrees to: (i)
whether or not the transactions herein contemplated are consummated, pay all
reasonable out-of-pocket costs and expenses of the Administrative Agent
(including, without limitation, the reasonable fees and disbursements of White &
Case LLP) in connection with the negotiation, preparation, execution and
delivery of the Credit Documents and the documents and instruments referred to
therein and any amendment, waiver or consent relating thereto and in connection
with the Administrative Agent's syndication efforts with respect to this
Agreement; (ii) pay all reasonable out-of-pocket costs and expenses of the
Administrative Agent, the Letter of Credit Issuer and each of the Banks in
connection with the enforcement of the Credit Documents and the documents and
instruments referred to therein and, after an Event of Default shall have
occurred and be continuing, the protection of the rights of the Administrative
Agent, the Letter of Credit Issuer and each of the Banks thereunder (including,
without limitation, the reasonable fees and disbursements of counsel (including
in-house counsel) for the Administrative Agent, the Letter of Credit Issuer and
for each of the Banks); (iii) pay and hold each of the Banks harmless from and
against any and all present and future stamp and other similar taxes with
respect to the foregoing matters and save each of the Banks harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Bank) to pay such taxes;
and (iv) indemnify the Administrative Agent, the Letter of Credit Issuer and
each Bank, its officers, directors, employees, representatives and agents from
and hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses incurred by any of them as a result of, or arising out of,
or in any way related to, or by reason of, any investigation, litigation or
other proceeding (whether or not the Administrative Agent, the Letter of Credit
Issuer or any Bank is a party thereto) related to the entering into and/or
performance of any Credit Document or the use of the proceeds of any Loans or
Letter of Credit hereunder or the consummation of any other transactions
contemplated in any Credit Document including, without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation, litigation or other proceeding (but excluding any such
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified).
12.02 Right of Setoff. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, upon the occurrence of an Event of Default, each
Bank (including to the extent such Bank is, or is deemed to be, the holder of a
funded participation in any Swingline Loan, Canadian Dollar Loan, and/or Letter
of Credit) is hereby authorized at any time or from time to time, without
presentment, demand, protest or other notice of any kind to the Company or any
of its Subsidiaries or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and apply
-96-
any and all deposits (general or special) and any other Indebtedness at any time
held or owing by such Bank (including, without limitation, by branches and
agencies of such Bank wherever located) to or for the credit or the account of
any Credit Party against and on account of the Obligations and liabilities of
such Credit Party to such Bank under this Agreement or under any of the other
Credit Documents, including, without limitation, all interests in Obligations of
such Credit Party purchased by such Bank pursuant to Section 12.06(b), and all
other claims of any nature or description arising out of or connected with this
Agreement or any other Credit Document, irrespective of whether or not such Bank
shall have made any demand hereunder and although said Obligations, liabilities
or claims, or any of them, shall be contingent or unmatured.
12.03 Notices. Except as otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including facsimile communication) and mailed, facsimilied or delivered, if to
a Borrower, at the address specified opposite its signature below or in the
other relevant Credit Documents, as the case may be; if to any Bank, at its
address specified for such Bank on Annex II hereto; or, at such other address as
shall be designated by any party in a written notice to the other parties
hereto. All such notices and communications shall be mailed, facsimilied or
cabled or sent by overnight courier, and shall be effective when received.
12.04 Benefit of Agreement. (a) This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto; provided that neither Borrower may
assign or transfer any of its respective rights or obligations hereunder without
the prior written consent of the Banks. Each Bank may at any time grant
participations in any of its rights hereunder to another financial institution;
provided further, that, in the case of any such participation, the participant
shall not have any rights under this Agreement or any of the other Credit
Documents (the participant's rights against such Bank in respect of such
participation to be those set forth in the agreement executed by such Bank in
favor of the participant relating thereto) and all amounts payable by either
Borrower hereunder shall be determined as if such Bank had not sold such
participation, except that the participant shall be entitled to receive the
additional amounts under Sections 1.10, 1.11, 2.06 and 4.04 of this Agreement
to, and only to, the extent that such Bank would be entitled to such benefits if
the participation had not been entered into or sold; and provided further, that
no Bank shall transfer, grant or assign any participation under which the
participant shall have rights to approve any amendment to or waiver of this
Agreement or any other Credit Document except to the extent such amendment or
waiver would (i) extend the final scheduled maturity of any Loan in which such
participant is participating (it being understood that any waiver of an
installment on, or the application of any prepayment or the method of
application of any prepayment to the amortization of the Loans shall not
constitute an extension of the final scheduled maturity date), or reduce the
rate or extend the time of payment of interest or Fees thereon (except in
connection with a waiver of the applicability of any post-default increase in
interest rates), or reduce the principal amount thereof, or increase such
participant's participating interest in any Commitment over the amount thereof
then in effect (it being understood that a waiver of any Default or Event of
Default or of a mandatory reduction in the Total Commitment shall not constitute
a change in the terms of any Commitment and that an increase in any Commitment
shall be permitted without the consent of any participant if such participant's
participation is not increased as a
-97-
result thereof), (ii) release the Company from the Company Guaranty or release
all or substantially all of the Subsidiary Guarantors from the Subsidiary
Guaranty (in each case except as expressly provided in the Credit Documents) or
(iii) in each case consent to the assignment or transfer by the Company, the
Canadian Borrower or any other Subsidiaries of the Company of any of its rights
and obligations under this Agreement or any other Credit Document except in
accordance with the terms hereof and thereof.
(b) Notwithstanding the foregoing, (x) any Bank may assign all
or a portion of its Loans and/or Commitment and its rights and obligations
hereunder to its parent corporation and/or any affiliate of such Bank which is
at least 50% owned by such Bank and/or its parent company and/or, in the case of
B Term Loans, an "Approved Fund" and (y) with the consent of the Administrative
Agent and the Company, and, in the case of any assignment of Tranche A Revolving
Loans and/or Tranche A Revolving Loan Commitments, of the Canadian Lender and
the Letter of Credit Issuer (which consents in each case shall not be
unreasonably withheld or delayed, it being understood that the Company may
withhold its consent if the result of any such assignment is that the assigning
Bank and/or the assignee Bank will not have a pro rata exposure in this
Agreement and the Additional Credit Agreement), any Bank may assign all or a
portion of its Loans and/or Commitments and its rights and obligations hereunder
to one or more commercial banks, other Persons who invest in commercial loan
facilities or other financial institutions (including one or more Banks). No
assignment pursuant to the immediately preceding sentence shall (x) to the
extent such transaction represents an assignment pursuant to clause (y) of the
preceding sentence (other than an assignment to a Bank), be in an aggregate
amount less than the minimum of $10,000,000 (or such lesser amount than
$10,000,000 as constitutes the assigning Bank's entire Commitment and
outstanding Loans or such lesser amount than $10,000,000 as may be approved by
the Administrative Agent and the Borrower ) or (y) so long as no Default or
Event of Default then exists, reduce the Loans and Commitments of the assigning
Bank to an aggregate amount less than the Minimum Retention Amount unless the
same are reduced to $0. If any Bank so sells or assigns all or a part of its
rights hereunder, any reference in this Agreement or the other Credit Documents
to such assigning Bank shall thereafter refer to such Bank and to the respective
assignee Bank to the extent of their respective interests and the respective
assignee Bank shall have, to the extent of such assignment (unless otherwise
provided therein), the same rights and benefits as it would if it were such
assigning Bank. Each assignment pursuant to this Section 12.04(b) shall be
effected by the assigning Bank and the assignee Bank executing an Assignment and
Assumption Agreement substantially in the form of Exhibit G (appropriately
completed). At the time of any such assignment, (i) Annex I shall be deemed to
be amended to reflect the Commitments and outstanding Loans of the respective
assignee Bank (which shall result in a direct reduction to the respective
Commitments of the assigning Bank) and of the other Banks, (ii) the
Administrative Agent shall record such assignment and the resultant effects
thereof on the Loans and/or Commitments of the assigning Bank and the assignee
Bank in the Register and (iii) the Administrative Agent shall receive from the
assigning Bank and/or the assignee Bank at the time of each assignment (other
than an assignment pursuant to clause (x) of the first sentence of this Section
12.04(b)) the payment of a nonrefundable assignment fee in an aggregate amount
of $3,000 with respect to each such assignment (provided that in the event of
simultaneous assignments relating to this Agreement and the Additional Credit
Agreement, the fees for such assignments shall total $3,000). Each
-98-
Bank and the Company agree to execute such documents (including, without
limitation, amendments to this Agreement and the other Credit Documents) as
shall be necessary to effect the foregoing. Promptly following any assignment
pursuant to this Section 12.04(b), the assigning Bank shall promptly notify the
Company thereof. Nothing in this Section 12.04(b) shall prevent or prohibit any
Bank from pledging its Loans or, if issued, Notes hereunder to a Federal Reserve
Bank in support of borrowings made by such Bank from such Federal Reserve Bank
or prevent any Bank which is an Approved Fund from, at any time, pledging all or
any portion of its Loans to its trustee or representative; provided, however,
that no such pledge shall release any Bank from its obligations hereunder or
substitute such Federal Reserve Bank, trustee or representative for such Bank as
a party hereto. Notwithstanding anything to the contrary contained herein, the
Canadian Dollar Loans may be assigned to the Banks as contemplated by Section
1.01(g). Except as specifically provided in the immediately preceding sentence
and in Section 1.01(g), the Canadian Lender shall not assign any portion of its
rights or obligations hereunder in respect of the Canadian Dollar Loans, except
an assignment of all of its rights and obligations in respect of such Canadian
Dollar Loans to one commercial bank or other financial institution acceptable to
the Administrative Agent, the Company and the Canadian Borrower.
(c) Notwithstanding any other provisions of this Section
12.04, no transfer or assignment of the interests or obligations of any Bank
hereunder or any grant of participations therein shall be permitted if such
transfer, assignment or grant would require the Company to file a registration
statement with the SEC or to qualify the Loans under the "Blue Sky" laws of any
State.
12.05 No Waiver; Remedies Cumulative. No failure or delay on
the part of the Administrative Agent, the Letter of Credit Issuer or any Bank in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between either Borrower and the Administrative
Agent, the Letter of Credit Issuer or any Bank shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies which the Administrative
Agent, the Letter of Credit Issuer or any Bank would otherwise have. No notice
to or demand on either Borrower in any case shall entitle such Borrower to any
other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Administrative Agent, the Letter of
Credit Issuer or the Banks to any other or further action in any circumstances
without notice or demand.
12.06 Payments Pro Rata. (a) The Administrative Agent agrees
that promptly after its receipt of each payment from or on behalf of a Borrower
in respect of any Obligations of such Borrower hereunder, it shall, except as
otherwise provided in this Agreement, distribute such payment to the Banks
(other than any Bank that has consented in writing to waive its pro rata share
of such payment) pro rata based upon their respective shares, if any, of the
Obligations with respect to which such payment was received.
-99-
(b) Each of the Banks agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings or Fees, of a sum which with respect to the
related sum or sums received by other Banks is in a greater proportion than the
total of such Obligation then owed and due to such Bank bears to the total of
such Obligation then owed and due to all of the Banks immediately prior to such
receipt, then such Bank receiving such excess payment shall purchase for cash
without recourse or warranty from the other Banks an interest in the Obligations
of the respective Borrower to such Banks in such amount as shall result in a
proportional participation by all of the Banks in such amount; provided that if
all or any portion of such excess amount is thereafter recovered from such Bank,
such purchase shall be rescinded and the purchase price restored to the extent
of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein,
the provisions of the preceding Sections 12.06(a) and (b) shall be subject to
the express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
12.07 Calculations; Computations. (a) The financial statements
to be furnished to the Banks pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Company to the Banks); provided that except as otherwise specifically
provided herein, all computations determining compliance with Section 8,
including definitions used therein, shall utilize accounting principles and
policies in effect at the time of the preparation of, and in conformity with
those used to prepare, the December 31, 1997 historical financial statements
delivered to the Banks pursuant to Section 6.10(a); provided further, that in
the event that the Accounting Standards Executive Committee of the AICPA adopts
the statement of position (substantially in the proposed form as of the Original
Effective Date) relating to computer software developed or obtained for internal
use, and the Company's independent auditors concur with such accounting change
as it relates to the presentation of the Company's financial statements, then
compliance with Section 8 will thereafter be determined giving effect to such
statement of position.
(b) All computations of interest (other than interest on Base
Rate Loans) and Fees hereunder shall be made on the actual number of days
elapsed over a year of 360 days. All computations of interest on Base Rate Loans
hereunder shall be made on the actual number of days elapsed over a year of 365
days.
12.08 Governing Law; Submission to Jurisdiction; Venue. (a)
THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. Any legal action or proceeding
with respect to this Agreement or any other Credit Document may be brought in
the courts of the State of New York or of the United States for the
-100-
Southern District of New York, and, by execution and delivery of this Agreement,
each Borrower hereby irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. Each Borrower hereby further irrevocably waives any claim that any such
courts lack jurisdiction over such Borrower, and agrees not to plead or claim,
in any legal action or proceeding with respect to this Agreement or any other
Credit Document brought in any of the aforesaid courts, that any such court
lacks jurisdiction over such Borrower. Each Borrower irrevocably consents to the
service of process in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to such Borrower, at
its address for notices pursuant to Section 12.03, such service to become
effective 30 days after such mailing. Each Borrower hereby irrevocably waives
and agrees not to plead or claim in any action or proceeding commenced hereunder
or under any other Credit Document that service of process was in any way
invalid or ineffective. The Company hereby represents and warrants that its
chief executive office is located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
and the Company hereby further agrees that it shall not move its chief executive
office unless it shall give the Administrative Agent not less than 30 days'
prior written notice of its intention so to do. The Company agrees that (x)
prior to moving its chief executive office outside New York City and (y) and if
for any reason any designee, appointee and agent previously appointed pursuant
to this sentence shall cease to be available to act as such, the Company shall
designate a designee, appointee and agent or replacement designee, appointee and
agent, as the case may be, in New York City on the terms and for the purposes of
this provision satisfactory to the Administrative Agent. Nothing herein shall
affect the right of the Administrative Agent, any Bank or the holder of any Note
to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against either Borrower in any other
jurisdiction.
(b) Each Borrower hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Agreement or any other Credit Document brought in the courts referred to in
clause (a) above and hereby further irrevocably waives and agrees not to plead
or claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum.
12.09 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. A
complete set of counterparts executed by all the parties hereto shall be lodged
with the Company and the Administrative Agent.
12.10 Effectiveness. This Agreement shall become effective on
the date (the "Restatement Effective Date") on which (i) each Borrower, the
Administrative Agent, the Required Banks (as defined in the Original Credit
Agreement) and each Bank that has a B Term Loan Commitment shall have signed a
copy hereof (whether the same or different copies) and shall have delivered the
same to the Administrative Agent at its Notice Office or, in the case of the
Banks, shall have given to the Administrative Agent telephonic (confirmed in
writing), written or facsimile notice (actually received) at such office that
the same has been signed and mailed to it and (ii) the conditions contained in
Section 5.01 are met to the satisfaction of the
-101-
Administrative Agent and the Required Banks (determined immediately after the
occurrence of the Restatement Effective Date). Unless the Administrative Agent
has received actual notice from any Bank that the conditions contained in
Section 5.01 have not been met to its satisfaction, upon the satisfaction of the
condition described in clause (i) of the immediately preceding sentence and upon
the Administrative Agent's good faith determination that the conditions
described in clause (ii) of the immediately preceding sentence have been met,
then the Restatement Effective Date shall have been deemed to have occurred,
regardless of any subsequent determination that one or more of the conditions
thereto have not been met (although the occurrence of the Restatement Effective
Date shall not release the Company from any liability for failure to satisfy one
or more the applicable conditions contained in Section 5.01). The Administrative
Agent will give the Borrower and each Bank prompt written notice of the
occurrence of the Restatement Effective Date.
12.11 Headings Descriptive. The headings of the several
sections and subsections of this Agreement are inserted for convenience only and
shall not in any way affect the meaning or construction of any provision of this
Agreement.
12.12 Amendment or Waiver. Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by each Borrower and the Required Banks; provided that no such
change, waiver, discharge or termination shall, without the consent of each Bank
(other than a Defaulting Bank) affected thereby, (i) extend any Scheduled A
Commitment Reduction Date, any Scheduled B Commitment Reduction Date, any
Scheduled TL Repayment Date, any Scheduled BTL Repayment Date or reduce the
amount of any Scheduled A Commitment Reduction, any Scheduled B Commitment
Reduction, any Scheduled TL Repayment or Scheduled BTL Repayment (or any
mandatory repayment arising as a result of any such Scheduled A Commitment
Reduction or any such Scheduled B Commitment Reduction) or extend the final
scheduled maturity of any Loan (it being understood that any waiver of the
application of any prepayment of or the method of application of any prepayment
to the amortization of the Loans shall not constitute any such extension), or
reduce the rate or extend the time of payment of interest (other than as a
result of waiving the applicability of any post-default increase in interest
rates) or Fees thereon, or reduce the principal amount thereof, or increase the
Commitments of any Bank over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or of a mandatory
repayment or reduction in the Total Commitment shall not constitute a change in
the terms of any Commitment of any Bank), (ii) release the Company from the
Company Guaranty or release all or substantially all of the Subsidiary
Guarantors from the Subsidiary Guaranty (in each case except as expressly
provided in the Credit Documents), (iii) amend, modify or waive any provision of
this Section, or Section 1.10, 1.11, 2.06, 4.04, 9.01, 11.07, 12.01, 12.02,
12.04, 12.06 or 12.07(b), (iv) reduce the percentage specified in, or otherwise
modify, the definition of, Required Banks, (v) increase the Maximum Canadian
Dollar Amount or (vi) consent to the assignment or transfer by any Credit Party
of any of its rights and obligations under this Agreement or any other Credit
Document except in accordance with the terms hereof or thereof. No provision of
Section 2 or 11 may be amended without the consent of the Letter of Credit
Issuer or the Administrative
-102-
Agent. No provision relating to Canadian Dollar Loans may be amended without the
consent of the Canadian Lender.
12.13 Survival. All indemnities set forth herein including,
without limitation, in Sections 1.10, 1.11, 2.06, 4.04, 11.07 or 12.01, shall
survive the execution and delivery of this Agreement and the making and
repayment of the Loans and the satisfaction of all other Obligations.
12.14 Domicile of Loans. Each Bank may transfer and carry its
Loans at, to or for the account of any branch office, subsidiary or affiliate of
such Bank, provided, that the Borrowers shall not be responsible for costs
arising under Sections 1.10, 1.11, 2.06 or 4.04 resulting from any such transfer
(other than a transfer pursuant to Section 1.12) to the extent such costs would
not otherwise be applicable to such Bank in the absence of such transfer.
12.15 Confidentiality. Each of the Banks agrees that it will
use its best efforts not to disclose without the prior consent of the Company
(other than to its employees, auditors, counsel or other professional advisors
and to affiliates or to another Bank if the Bank or such Bank's holding or
parent company in its sole discretion determines that any such party should have
access to such information) any information with respect to the Company or any
of its Subsidiaries which is furnished pursuant to this Agreement and which is
designated by the Company to the Banks in writing as confidential, provided that
any Bank may disclose any such information (a) as has become generally available
to the public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state, provincial or Federal regulatory
body having or claiming to have jurisdiction over such Bank or to the Federal
Reserve Board or the Federal Deposit Insurance Corporation, the National
Association of Insurance Commissioners or similar organizations (whether in the
United States or elsewhere) or their successors, (c) as may be required or
appropriate in response to any summons or subpoena or in connection with any
litigation, (d) in order to comply with any law, order, regulation or ruling
applicable to such Bank, and (e) to any prospective transferee in connection
with any contemplated transfer of any of the Loans and/or Commitments or any
interest herein by such Bank, provided that such prospective transferee agrees
to be bound by the provisions of this Section.
12.16 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS
AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
* * *
-103-
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the date
first above written.
Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ PRIMEDIA INC.
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By:__________________________
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq. Title: VP, Treasurer
c/o PRIMEDIA Inc. CANADIAN SAILINGS INC.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By:______________________
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq. Title: VP, Treasurer
THE CHASE MANHATTAN BANK
Individually and as
Administrative Agent
By:______________________
Title:
BANKERS TRUST COMPANY,
Individually and as
Co-Syndication Agent
By:______________________
Title:
-104-
THE BANK OF NEW YORK,
Individually and as
Co-Syndication Agent
By:______________________
Title:
THE BANK OF NOVA SCOTIA,
Individually, as Canadian Lender
and as Documentation Agent
By:______________________
Title:
BANK OF AMERICA NT&SA
By:______________________
Title:
NATIONSBANK OF TEXAS, N.A.
By:______________________
Title:
FLEET NATIONAL BANK
By:______________________
Title:
MARINE MIDLAND BANK
By:______________________
Title:
-105-
SOCIETE GENERALE, NEW YORK BRANCH
By:______________________
Title:
THE INDUSTRIAL BANK OF
JAPAN, LIMITED
By:______________________
Title:
ROYAL BANK OF CANADA
By:______________________
Title:
CIBC INC.
By:______________________
Title:
LTCB TRUST COMPANY
By:______________________
Title:
MELLON BANK, N.A.
By:______________________
Title:
-106-
THE DAI-ICHI KANGYO BANK, LTD.,
NEW YORK BRANCH
By:______________________
Title:
THE MITSUBISHI TRUST AND
BANKING CORPORATION
By:______________________
Title:
THE SAKURA BANK, LIMITED,
NEW YORK BRANCH
By:______________________
Title:
TORONTO DOMINION (NEW YORK), INC.
By:______________________
Title:
CREDIT LYONNAIS NEW YORK BRANCH
By:______________________
Title:
BANK OF MONTREAL,
CHICAGO BRANCH
By:______________________
Title:
-107-
CREDIT AGRICOLE INDOSUEZ
By:______________________
Title:
By:______________________
Title:
STB DELAWARE FUNDING TRUST I
By:______________________
Title:
UNION BANK OF CALIFORNIA, N.A.
By:______________________
Title:
SUMMIT BANK
By:______________________
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING
RATE FUND
By:______________________
Title:
DEBT STRATEGIES FUND II, INC.
By:______________________
Title:
DEBT STRATEGIES FUND III, INC.
By:______________________
Title:
-108-
BANK OF HAWAII
By:______________________
Title:
PARIBAS
By:______________________
Title:
NATEXIS BANQUE BFCE
By:______________________
Title:
CREDIT SUISSE FIRST BOSTON
By:______________________
Title:
By:______________________
Title:
▇▇▇▇▇▇ BANK, Plc
By:______________________
Title:
FIRST UNION NATIONAL BANK
By:______________________
Title:
-109-
THE SANWA BANK, LIMITED,
NEW YORK BRANCH
By:______________________
Title:
ALLSTATE INSURANCE COMPANY
By:______________________
Title:
By:______________________
Title:
ALLSTATE LIFE INSURANCE COMPANY
By:______________________
Title:
By:______________________
Title:
DLJ CAPITAL FUNDING, INC.
By:______________________
Title:
FRANKLIN FLOATING RATE TRUST
By:______________________
Title:
GENERAL ELECTRIC CAPITAL
CORP.
By:______________________
Title:
-110-
KZH HIGHLAND-2 LLC
By:______________________
Title:
KZH CYPRESSTREE-1 LLC
By:______________________
Title:
KZH SOLEIL-2 LLC
By:______________________
Title:
KZH III LLC
By:______________________
Title:
KZH IV LLC
By:______________________
Title:
METROPOLITAN LIFE INSURANCE
COMPANY
By:______________________
Title:
NEW YORK LIFE INSURANCE COMPANY
By:______________________
Title:
-111-
OCTAGON LOAN TRUST
by Octagon Credit Investors,
as Manager
By:______________________
Title:
KZH LANGDALE LLC
By:______________________
Title:
▇▇▇▇▇ BANK, N.A.
By:______________________
Title:
SENIOR DEBT PORTFOLIO
by Boston Management &
Research as Investment Advisor
By:______________________
Title:
CRESCENT/MACH I PARTNERS, L.P.
By:______________________
Title:
KZH CRESCENT LLC
By:______________________
Title:
KZH CRESCENT-2 LLC
By:______________________
Title:
-112-
KZH CRESCENT-3 LLC
By:______________________
Title:
▇▇▇ ▇▇▇▇▇▇ PRIME RATE
INCOME TRUST
By:______________________
Title:
-113-
ANNEX I
LIST OF BANKS
-------------
Tranche A Tranche B
Revolving Loan Revolving Loan Term Loan B Term Loan
Bank Commitment Commitment Commitment Commitment
---- ---------- ---------- ---------- ----------
The Chase Manhattan Bank $60,000,000 $26,500,000* $2,500,000 $63,000,000
Bank of America NT&SA 36,000,000 10,000,000* 2,000,000 10,000,000
Nationsbank of Texas, N.A. 24,000,000 10,000,000* 8,000,000
The Bank of New York 45,000,000 15,000,000* 15,000,000 10,000,000
The Bank of Nova Scotia 33,000,000 17,000,000* 11,000,000 5,000,000
Bankers Trust Company 33,666,667 19,833,333* 6,000,000
Fleet National Bank 30,000,000 15,000,000* 10,000,000
General Electric 32,000,000 13,000,000
Royal Bank of Canada 30,000,000 10,000,000
The Industrial Bank of Japan, Ltd. 36,000,000 2,000,000
Union Bank of California, N.A. 27,000,000 11,500,000 5,000,000
Societe Generale, 27,000,000 9,000,000
New York Branch
CIBC, Inc. 24,000,000 8,000,000
Marine Midland Bank 24,000,000 8,000,000
The Long-Term Credit Bank of Japan, Ltd. 24,000,000 8,000,000
The Mitsubishi Trust and Banking 24,000,000 8,000,000
Corporation
-114-
Tranche A Tranche B
Revolving Loan Revolving Loan Term Loan B Term Loan
Bank Commitment Commitment Commitment Commitment
---- ---------- ---------- ---------- ----------
Toronto Dominion Bank, 13,000,000 15,000,000* 2,000,000 15,000,000
New York Branch
Bank of Montreal, 15,000,000 10,000,000* 5,000,000
Chicago Branch
Credit Lyonnais 21,000,000 7,000,000
The Sakura Bank, Ltd. 18,000,000 6,000,000
Credit Agricole Indosuez 15,000,000 5,000,000
Credit Suisse First Boston 9,000,000 10,000,000* 3,000,000
Mellon Bank 15,000,000 5,000,000
The Dai-Ichi Kangyo Bank, Ltd. 13,500,000 4,500,000
STB Delaware Funding 15,000,000 5,000,000
Trust I
Summit Bank 15,000,000 5,000,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ Senior Floating Rate Fund 12,000,000 4,000,000 10,000,000
Debt Strategies Fund II 4,000,000
Debt Strategies Fund III 1,000,000
Bank of Hawaii 9,000,000 3,000,000
Paribas 9,000,000 3,000,000
▇▇▇▇▇▇ Bank, Plc . 9,000,000 3,000,000
Natexis Banque BFCE 8,333,333 1,666,667*
▇▇▇▇▇ Bank, N.A. 9,000,000 3,000,000
Tranche A Tranche B
Revolving Loan Revolving Loan Term Loan B Term Loan
Bank Commitment Commitment Commitment Commitment
---- ---------- ---------- ---------- ----------
First Union National Bank 9,000,000 3,000,000
The Sanwa Bank Ltd. 9,000,000 3,000,000
▇▇▇ ▇▇▇▇▇▇ Prime Rate 15,000,000
Income Trust
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Capital 6,000,000 2,000,000
Funding
KZH III LLC 4,000,000
KZH IV LLC 3,000,000
Octagon Loan Trust 25,000,000
Crescent / Mach I Partners, L.P. 3,000,000
KZH Crescent LLC 3,500,000
KZH Crescent-2 LLC 5,000,000
KZH Crescent-3 LLC 3,500,000
KZH Highland-2 LLC 10,000,000
Metropolitan Life Insurance Company 10,000,000
KZH-Soleil-2 LLC 20,000,000
Allstate Insurance Company 4,500,000
Allstate Life Insurance Company 5,500,000
Franklin Floating Rate Trust 10,000,000
New York Life Insurance Company 10,000,000
Tranche A Tranche B
Revolving Loan Revolving Loan Term Loan B Term Loan
Bank Commitment Commitment Commitment Commitment
---- ---------- ---------- ---------- ----------
KZH Langdale LLC 5,000,000
KZH-CypressTree-1 LLC 5,000,000
Total $750,000,000 $150,000,000* $250,000,000 $250,000,000
============ ============ ============ ============
* Pursuant to Tranch B Assumption Agreements, dated May 20, 1997.
ANNEX II
--------
BANK ADDRESSES
--------------
Bank Address
---- -------
The Chase Manhattan Bank. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Bankers Trust Company ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
The Bank of New York ▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇
Bank of Nova Scotia ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Canadian Notice Office and Canadian
Payment Office:
International Banking Division
Loan Administration and Agency Services
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇/2816/4089
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇/
▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇
Annex II
Page 2
Bank of America NT&SA ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
NationsBank of Texas, N.A. Bank of America
Entertainment/Media Group
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Fleet National Bank ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
General Electric Capital Corp. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Royal Bank of Canada ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
The Industrial Bank of 1251 Avenue of the Americas
Japan, Limited ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Annex II
Page 3
Union Bank of California, N.A. ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Societe Generale, New York 1221 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Senior Debt Portfolio ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
by Boston Management & 6th Floor
Research as Investment Manager ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇ ▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇
CIBC Inc. ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Marine Midland Bank, ▇▇▇ ▇▇▇▇▇▇▇▇
c/o HSBC Securities, Inc. ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
LTCB Trust Company ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Annex II
Page 4
The Mitsubishi Trust and ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Banking Corporation ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Toronto Dominion (New York), ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇. ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇
with a copy to:
▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Credit Lyonnais 1301 Avenue of the Americas
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ Legoulven
The Sakura Bank, Limited, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Arifumi Hirata
Credit Agricole Indosuez ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Annex II
Page 5
Credit Suisse First Boston 5 World Trade ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Mellon Bank, N.A. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇
The Dai-Ichi Kangyo Bank, Ltd., One World Trade Center
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
STB Delaware Funding Trust I ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Summit Bank ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ Senior Floating ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
Rate Fund Area 2C
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Annex II
Page 6
Debt Strategies Fund II, Inc. ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ / ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Debt Strategies Fund III, Inc. ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ / ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Bank of Hawaii ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Paribas ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ Bank Plc. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Natexis Banque BFCE ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ Bank, N.A. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Annex II
Page 7
First Union National Bank ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ 4829
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
The Sanwa Bank, Limited, Park Avenue Plaza
New York Branch ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. Small
▇▇▇ ▇▇▇▇▇▇ Prime Rate One Parkview Plaza
Income Trust ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
DLJ Capital Funding, Inc. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
KZH III LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
KZH IV LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Annex II
Page 8
Octagon Credit Investors ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Crescent/Mach I Partners, L.P. TCW Asset Management Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. Gold
With copies to:
Crescent/Mach I Partners, L.P.
c/o State Street Bank & Trust Co.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
KZH Crescent LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
KZH Crescent-2 LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Annex II
Page 9
KZH Crescent-3 LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
KZH Highland-2 LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Metropolitan Life Insurance ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
KZH Soleil-2 LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Allstate Insurance Company ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
Allstate Life Insurance Company ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
Annex II
Page 10
Franklin Floating Rate Trust ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
New York Life Insurance ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Company ▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
KZH Langdale LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
KZH CypressTree-1 LLC ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
ANNEX III
---------
SUBSIDIARIES
------------
ANNEX IV
--------
LIENS
-----
ANNEX V
-------
PART A. EXISTING DEBT
-------------
[To include existing Senior Notes and Non-Compete Notes]
PART B. EXISTING CONTINGENT OBLIGATIONS
-------------------------------
ANNEX VI
--------
EXISTING PREFERRED STOCK
ANNEX C-1
---------
FORM OF NOTICE OF BORROWING
---------------------------
[Date]
The Chase Manhattan Bank,
as Administrative Agent for the
Banks party to the Credit Agreement
referred to below
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ____________________
Ladies and Gentlemen:
The undersigned refers to the Credit Agreement, dated as of
May 24, 1996, as amended and restated as of March ___, 1999 (as further amended,
modified or supplemented from time to time, the "Credit Agreement," the terms
defined therein being used herein as therein defined), among PRIMEDIA Inc.,
certain Banks from time to time party thereto, The Bank of New York and Bankers
Trust Company, as Co-Syndication Agents, The Bank of Nova Scotia, as
Documentation Agent, and you, as Administrative Agent for such Banks, and hereby
gives you irrevocable notice, pursuant to Section 1.03 of the Credit Agreement,
that the undersigned hereby requests a Borrowing under the Credit Agreement, and
in that connection sets forth below the information relating to such Borrowing
(the "Proposed Borrowing") as required by Section 1.03 of the Credit Agreement:
(xvii) The Business Day of the Proposed Borrowing is
________, 19__.1
(xviii) The aggregate principal amount of the Proposed
Borrowing is $________.
(xix) The Proposed Borrowing is to consist of [Term Loans][B
Term Loans][Tranche A Revolving Loans][Tranche B Revolving
Loans][Swingline Loans][Canadian Dollar Loans].
(xx) The Proposed Borrowing is to consist of [Base Rate
Loans] [Eurodollar Loans].
--------
1 A Notice of Borrowing must be given at least one Business Day prior to the
date of the Proposed Borrowing in the case of Base Rate Loans and three
Business Days prior to the date of the Proposed Borrowing in the case of
Eurodollar Loans.
Annex C-1
Page2
[(xxi) The initial Interest Period for the Proposed Borrowing
is ___ months.]2
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the Proposed
Borrowing:
(A) the representations and warranties contained in the Credit
Agreement or the other Credit Documents are and will be true and
correct in all material respects, before and after giving effect to the
Proposed Borrowing and to the application of the proceeds thereof, as
though made on and as of such date, unless 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) no Default or Event of Default has occurred and is
continuing, or would result from such Proposed Borrowing or from the
application of the proceeds thereof.
Very truly yours,
PRIMEDIA INC.
By ________________________________
Title:
FORM OF TRANCHE B ASSUMPTION AGREEMENT
[Letterhead of Bank]
_____________, 199__
PRIMEDIA Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
re Tranche B Revolving Loan Commitment
----------------------------------------
--------
2 To be included for a Proposed Borrowing of Eurodollar Loans.