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Exhibit 10.3
US$1,100,000,000 CREDIT AGREEMENT
dated as of December 21, 1994,
as amended and restated as of
October 23, 1998
among
THE SEAGRAM COMPANY LTD.,
as Borrower
The LENDERS Party Hereto
and
BANK OF MONTREAL,
as Administrative Agent
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Defined Terms......................................................... 1
SECTION 1.02. Classification of Loans and Borrowings................................ 15
SECTION 1.03. Terms Generally ...................................................... 15
SECTION 1.04. Accounting Terms; GAAP................................................ 16
ARTICLE II
The Credits
SECTION 2.01. Commitments........................................................... 16
SECTION 2.02. Loans and Borrowings.................................................. 17
SECTION 2.03. Requests for Revolving Borrowings..................................... 17
SECTION 2.04. Competitive Bid Procedure............................................. 18
SECTION 2.05. Money Market Loans.................................................... 20
SECTION 2.06. Funding of Borrowings................................................. 22
SECTION 2.07. Interest Elections.................................................... 23
SECTION 2.08. Termination and Reduction of
Commitments....................................................... 24
SECTION 2.09. Repayment of Loans; Evidence of Debt.................................. 25
SECTION 2.10. Prepayment of Loans................................................... 25
SECTION 2.11. Fees.................................................................. 26
SECTION 2.12. Interest.............................................................. 27
SECTION 2.13. Alternate Rate of Interest............................................ 28
SECTION 2.14. Additional Interest on Eurodollar Loans;
Increased Costs................................................... 29
SECTION 2.15. Break Funding Payments................................................ 30
SECTION 2.16. Taxes................................................................. 31
SECTION 2.17. Payments Generally; Pro Rata Treatment;
Sharing of Setoffs................................................ 32
SECTION 2.18. Mitigation Obligations; Termination or
Replacement of Lenders............................................ 34
SECTION 2.19. Extension of Maturity Date............................................ 35
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ARTICLE III
Representations and Warranties
SECTION 3.01. Organization; Powers.................................................. 36
SECTION 3.02. Authorization; Enforceability......................................... 36
SECTION 3.03. Governmental Approvals; No Conflicts.................................. 36
SECTION 3.04. Financial Condition; No Material Adverse
Change............................................................. 37
SECTION 3.05. Properties............................................................ 37
SECTION 3.06. Litigation ........................................................... 37
SECTION 3.07. Compliance with Laws.................................................. 37
SECTION 3.08. Investment and Holding Company Status................................. 38
SECTION 3.09. ERISA................................................................. 38
SECTION 3.10. Disclosure............................................................ 38
SECTION 3.11. Regulation U and X.................................................... 38
SECTION 3.12. Pari Passu Ranking.................................................... 38
SECTION 3.13. Year 2000 ............................................................ 38
ARTICLE IV
Conditions
SECTION 4.01. Amendment Effective Date.............................................. 38
SECTION 4.02. Each Credit Event..................................................... 40
ARTICLE V
Affirmative Covenants
SECTION 5.01. Financial Statements and Other
Information........................................................ 40
SECTION 5.02. Notices of Material Events............................................ 42
SECTION 5.03. Existence; Conduct of Business........................................ 42
SECTION 5.04 Payment of Taxes...................................................... 42
SECTION 5.05. Maintenance of Insurance. ............................................ 43
SECTION 5.06. Books and Records; Inspection Rights.................................. 43
SECTION 5.07. Compliance with Laws.................................................. 43
SECTION 5.08. Use of Proceeds....................................................... 43
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ARTICLE VI
Negative Covenants
SECTION 6.01. Liens and Sale and Lease-Back Transactions............................ 43
SECTION 6.02. Fundamental Changes................................................... 45
SECTION 6.03. Transactions with Affiliates.......................................... 45
SECTION 6.04. Restrictive Agreements................................................ 45
SECTION 6.05. Leverage Ratio........................................................ 46
SECTION 6.06. Interest Coverage Ratio............................................... 46
ARTICLE VII
Events of Default..................................................... 47
ARTICLE VIII
The Administrative Agent.............................................. 49
ARTICLE IX
[INTENTIONALLY OMITTED]............................................... 52
ARTICLE X
Miscellaneous
SECTION 10.01. Notices............................................................... 52
SECTION 10.02. Waivers; Amendments................................................... 52
SECTION 10.03. Expenses; Indemnity; Damage Waiver.................................... 53
SECTION 10.04. Successors and Assigns................................................ 54
SECTION 10.05. Survival.............................................................. 58
SECTION 10.06. Counterparts; Integration;
Effectiveness....................................................... 58
SECTION 10.07. Severability.......................................................... 59
SECTION 10.08. Right of Setoff....................................................... 59
SECTION 10.09. Governing Law; Jurisdiction; Consent
to Service of Process............................................... 59
SECTION 10.10. WAIVER OF JURY TRIAL.................................................. 60
SECTION 10.11. Headings.............................................................. 61
SECTION 10.12. Confidentiality....................................................... 61
SECTION 10.13. Interest Rate Limitation.............................................. 61
SECTION 10.14. Effect of Amendment and Restatement................................... 62
SECTION 10.15. Language.............................................................. 62
SECTION 10.16. Superior Force........................................................ 62
SCHEDULES:
Schedule 2.01 -- Commitments
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EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B-1 -- Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Exhibit B-2 -- Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
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CREDIT AGREEMENT dated as of December 21,
1994, as amended and restated as of October 23, 1998,
among THE SEAGRAM COMPANY LTD., the LENDERS party
hereto and BANK OF MONTREAL, as Administrative Agent,
The parties hereto are parties to the Seagram Existing Credit
Agreement (such term and the other capitalized terms used herein having the
meanings hereinafter provided). The parties hereto desire to amend and restate
the Seagram Existing Credit Agreement in the form hereof. Accordingly the
parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this
Agreement, the following terms have the meanings specified below:
"364 Day Credit Agreement" means the Credit Agreement dated as
of October 21, 1998, among ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ & Sons, Inc., the Borrower, as
guarantor, ▇.▇. ▇▇▇▇▇▇▇ Corp., as guarantor, the Lenders party thereto, The
Chase Manhattan Bank, as administrative agent, Citibank, N.A., as syndication
agent, and Bank of America NT & SA and Bank of Montreal, as co-documentation
agents.
"ABR", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Acquisition" means the acquisition by the Borrower, directly
and/or through its Subsidiaries, of not less than 75% of the issued and
outstanding capital stock of Polygram from Philips Electronics N.V. and other
public stockholders for consideration consisting of common shares of the
Borrower and cash payments.
"Administrative Agent" means Bank of Montreal, in its capacity
as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum
equal to the greater of (a) the Prime Rate in effect on such day and (b) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in
the Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall
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be effective from and including the effective date of such change in the Prime
Rate or the Federal Funds Effective Rate, respectively.
"Amendment Effective Date" means the date on which the
conditions specified in Section 4.01 are satisfied (or waived in accordance with
Section 10.02).
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.
"Applicable Rate" means, for any day, with respect to any
Eurodollar Revolving Loan, or with respect to the facility fees payable
hereunder, as the case may be, the applicable rate per annum set forth below
under the caption "Eurodollar Spread" or "Facility Fee Rate", as the case may
be, based upon the ratings by ▇▇▇▇▇'▇ and S&P, respectively, applicable on such
date to the Index Debt; provided, that (i) before the Maturity Date, on any date
when outstanding Loans (including Competitive Loans) exceed 50% of the aggregate
Commitments, or (ii) after the Maturity Date, on any date when outstanding Loans
exceed 50% of the aggregate Commitments in effect immediately prior to the
Maturity Date, the Eurodollar Spread otherwise applicable to all outstanding
Revolving Loans shall be increased by 0.075%:
Eurodollar Facility Fee
Index Debt Ratings: Spread Rate
Category 1
> = A-/A3 0.210% 0.090%
Category 2
BBB+/Baa1 0.250% 0.100%
Category 3
BBB/Baa2 0.275% 0.125%
Category 4
BBB-/Baa3 0.300% 0.150%
Category 5
BB+/Ba1 0.400% 0.225%
Category 6