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EXHIBIT 10(g)
COMPOSITE CONFORMED COPY
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CREDIT, SECURITY AND GUARANTY AGREEMENT
Dated as of November 1, 1995
Among
ORION PICTURES CORPORATION
as Borrower
and
THE CORPORATE GUARANTORS REFERRED TO HEREIN
and
THE LENDERS REFERRED TO HEREIN
and
CHEMICAL BANK
as Agent
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TABLE OF CONTENTS
INTRODUCTORY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. THE LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.1. Revolving Credit Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.2. Term Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.3. Making of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.4. Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 2.5. Notes; Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 2.6. Interest on Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 2.7. Commitment Fees and Other Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 2.8. Optional and Mandatory Termination or
Reduction of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 2.9. Default Interest; Alternate Rate of
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 2.10. Interest Adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 2.11. Continuation and Conversion of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 2.12. Prepayment of Loans; Reimbursement of
Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 2.13. Change in Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 2.14. Change in Legality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 2.15. Manner of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 2.16. United States Withholdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 2.17. Provisions Relating to the Borrowing Base . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
3. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 3.1. Corporate Existence and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 3.2. Corporate Authority and No Violation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 3.3. Governmental Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 3.4. Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 3.5. No Material Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 3.6. Title to Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 3.7. UCC Filing Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 3.8. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 3.9. Federal Reserve Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 3.10. Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 3.11. Enforceability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 3.12. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 3.13. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 3.14. Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 3.15. True and Complete Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
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SECTION 3.16. Security Interests; Other Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 3.17. Ownership of Pledged Securities, Inactive
Subsidiaries, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 3.18. Ownership of Product; Copyrights and
Other Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 3.19. Distribution Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 3.20. Fictitious Names . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 3.21. Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 3.22. Environmental Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 3.23. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
4. CONDITIONS OF LENDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 4.1. Conditions Precedent to the Initial Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 4.2. Condition Precedent to Each Loan and
Each Letter of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
5. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 5.1. Financial Statement, Reports, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 5.2. Corporate Existence; Compliance with
Statutes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 5.3. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 5.4. Completion Guaranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.5. Taxes and Charges; Obligations in
Ordinary Course of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.6. Chief Executive Office; Corporate Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.7. ERISA Compliance and Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
SECTION 5.8. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 5.9. Access to Books and Records;
Examinations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 5.10. Third Party Audit Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 5.11. Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
SECTION 5.12. Material Adverse Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
SECTION 5.13. Further Assurances; Security Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
SECTION 5.14. Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 5.15. Copyright . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 5.16. Film Properties and Rights; Credit
Parties to Act as Pledgeholder. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 5.17. Laboratories; No Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 5.18. Lab Access Letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 5.19. Cash Receipts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 5.20. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 5.21. Security Agreements with the Guilds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 5.22. Bank Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
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SECTION 5.23. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 5.24. Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 5.25. Music . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 5.26. Distribution Agreements; Negative
Pickups; etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 5.27. Separate Corporate Structures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 5.28. Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
6. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 6.1. Limitation on Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 6.2. Limitation on Guaranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
SECTION 6.3. No Change in Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
SECTION 6.4. Consolidation, Merger, Sale or
Purchase of Assets, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
SECTION 6.5. Limitation on Loans and Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
SECTION 6.6. Limitation On Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 6.7. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 6.8. Limitation on Leases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 6.9. Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 6.10. Sale and Leaseback . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 6.11. ERISA Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 6.12. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 6.13. Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 6.14. Use of Proceeds of Loans and Requests
for Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 6.15. Budgeted Negative Cost; etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 6.16. Unrecouped Print and Advertising Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 6.17. Development Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 6.18. Principal Photography . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 6.19. Joint Venture; Co-Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 6.20. Free Cash Flow Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 6.21. Limitations on Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 6.22. Cumulative Film Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 6.23. Limitations on Net Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 6.24. Overhead Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 6.25. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 6.26. Special Purpose Distributors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
7. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 7.1. Term Loan Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 7.2. Revolving Loan Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
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8. SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 8.1. Security Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 8.2. Use of Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 8.3. Collection Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 8.4. Credit Parties to Hold in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
SECTION 8.5. Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
SECTION 8.6. Possession, Sale of Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
SECTION 8.7. Application of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 8.8. Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
SECTION 8.9. Financing Statements and Payment
Directions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
SECTION 8.10. Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
SECTION 8.11. Remedies Not Exclusive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
SECTION 8.12. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
SECTION 8.13. Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
SECTION 8.14. Release of Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
9. GUARANTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
SECTION 9.1. Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
SECTION 9.2. No Impairment of Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
SECTION 9.3. Continuation and Reinstatement, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
SECTION 9.4. Limitation on Guaranteed Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
SECTION 9.5. Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
10. CASH COLLATERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 10.1. Cash Collateral Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 10.2. Investment of Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 10.3. Grant of Security Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
SECTION 10.4. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
11. THE AGENT AND THE ISSUING BANK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
SECTION 11.1. Administration by Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
SECTION 11.2. Advances and Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112
SECTION 11.3. Sharing of Setoffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
SECTION 11.4. Agreement of Required Lenders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
SECTION 11.5. Notice to Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
SECTION 11.6. Liability of Agent and Issuing Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
SECTION 11.7. Reimbursement and Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
SECTION 11.8. Rights of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
SECTION 11.9. Independent Investigation by Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
SECTION 11.10. Notice of Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
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SECTION 11.11. Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
12. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
SECTION 12.1. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
SECTION 12.2. Survival of Agreement, Representations
and Warranties, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
SECTION 12.3. Successors and Assigns; Syndications;
Loan Sales; Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
SECTION 12.4. Expenses; Documentary Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
SECTION 12.5. Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122
SECTION 12.6. CHOICE OF LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
SECTION 12.7. No Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
SECTION 12.8. Extension of Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
SECTION 12.9. Amendments; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
SECTION 12.10. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
SECTION 12.11. WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
SECTION 12.12. SERVICE OF PROCESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
SECTION 12.13. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
SECTION 12.14. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
SECTION 12.15. Termination of Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
SECTION 12.16. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
SECTION 12.17. Subordination of Intercompany Advances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
v
7
Schedules
1 Schedule of Commitments
2 Approved Account Debtors/Allowable Amounts
3.2 Stock Transfer Restrictions
3.7 Chief Executive Offices; Location of Collateral
3.8 Litigation
3.13 ERISA
3.14 Material Agreements and Contracts
3.17(a) Partnerships Interests; Etc.
3.17(b) Subsidiaries
3.17(c) Inactive Subsidiaries
3.18(a) Product
3.18(b) Copyrights
3.20 Fictitious Names
6.1 Indebtedness
6.6 Liens
Exhibits
Exhibit A-1 - Form of Revolving Credit Note
Exhibit A-2 - Form of Term Note
Exhibit B-1 - Form of Copyright Security Agreement
Exhibit B-2 - Form of Copyright Security Agreement Supplement
Exhibit C-1 - Form of Pledgeholder Agreement (Uncompleted Product)
Exhibit C-2 - Form of Pledgeholder Agreement (Completed Product)
Exhibit D-1 - Form of Borrower Pledge Agreement
Exhibit D-2 - Form of Parent Pledge Agreement
Exhibit D-3 - Form of Subsidiary Pledge Agreement
Exhibit D-4 - Form of Pledge Agreement Supplement
Exhibit E - Form of Subordination Agreement
Exhibit F - Form of Laboratory Access Letter
Exhibit G - Form of Assignment and Acceptance
Exhibit H-1 - Opinion of Counsel to the Credit Parties
Exhibit H-2 - Opinion of Counsel to the Credit Parties
Exhibit H-3 - Opinion of Counsel to the Credit Parties
Exhibit I - Form of Compliance Certificate
Exhibit J - Form of Borrowing Base Certificate
Exhibit K - Form of Borrowing Certificate
Exhibit L - Form of Priority and Contribution Agreement
Exhibit M - Form of Guaranty Agreement
Exhibit N - Form of Instrument of Assumption and Joinder
Exhibit O - Form of Notice of Assignment and Irrevocable
Instructions
vi
8
CREDIT, SECURITY AND GUARANTY AGREEMENT,
dated as of November 1, 1995 among (i) ORION
PICTURES CORPORATION, a Delaware corporation (the
"Borrower"), (ii) the Corporate Guarantors referred
to herein, (iii) the Lenders referred to herein and
(iv) CHEMICAL BANK, a New York banking corporation,
as agent for the Lenders (in such capacity, the
"Agent") and as Issuing Bank.
INTRODUCTORY STATEMENT
All defined terms not otherwise defined above or in this
Introductory Statement are as defined in Article 1 hereof, or as defined
elsewhere herein.
On the date hereof the following mergers were consummated: (i)
the merger (the "Orion Merger") of Orion Pictures Corporation, a Delaware
corporation ("Old Orion") with and into, OPC Merger Corp., a Delaware
corporation and a wholly-owned and newly formed subsidiary of The Actava Group
Inc., a Delaware corporation ("Actava") with the Borrower being the survivor of
the Orion Merger; the Borrower has changed its name to Orion Pictures
Corporation; (ii) the merger (the "MITI Merger") of Metromedia International
Telecommunications, Inc., a Delaware corporation, into a wholly-owned and newly
formed subsidiary ("New MITI") of Actava, with New MITI being the surviving
corporation of the MITI Merger; and (iii) the merger (the "MCEG Merger" and,
together with the Orion Merger and the MITI Merger, the "Mergers") of MCEG
Sterling Incorporated, a Delaware corporation ("MCEG"), into ▇▇▇▇▇▇, with
▇▇▇▇▇▇ being the surviving corporation of the MCEG ▇▇▇▇▇▇. Actava has changed
its name to Metromedia International Group, Inc. (hereinafter referred to as
the "Parent"). Upon consummation of the Mergers the Parent transferred all of
the assets formerly owned by MCEG to the Borrower (the "MCEG Transfer"). The
Borrower will conduct the entertainment business formerly conducted by Old
Orion and MCEG.
The Borrower has requested that the Lenders make available a
$185,000,000 five-year secured credit facility
9
consisting of a term loan of $135,000,000 and a revolving credit facility of
$50,000,000. The proceeds of the term loan will be used to refinance and/or
repay a portion of the Bankruptcy Plan Debt of Old Orion. The proceeds of the
revolving credit facility will be used to finance the Borrower's development,
production, acquisition, worldwide distribution and exploitation of motion
pictures, video product and made-for-television product (other than the
production of newly created deficit-financed made-for-television programming),
in each case, including ancillary rights and for general working capital
purposes.
To provide assurance and security for the repayment of the
Loans and other Obligations of the Borrower hereunder, the Parent, the Borrower
and the Corporate Guarantors will provide or will cause to be provided to the
Agent for the benefit of the Lenders, the following (each as more fully
described herein):
(i) a security interest in the Collateral
pursuant to Article 8 hereof;
(ii) a guaranty of the Obligations pursuant to
Article 9 hereof;
(iii) a pledge of the capital stock of the
Corporate Guarantors pursuant to the Borrower Pledge
Agreement; and
(iv) a pledge of the capital stock of the Borrower
pursuant to the Parent Pledge Agreement.
As a result of the Mergers, a major shareholder of the Parent
will be Metromedia Company, a Delaware general partnership ("Metromedia") whose
general partners are ▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇") and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (▇▇▇▇▇
together with Metromedia, the "Guarantors"). To provide further assurance and
in order to induce the Agent and the Lenders to enter into this Agreement, the
Guarantors will provide to the Agent for the benefit of the Lenders, an
unconditional guaranty of payment of the Obligations under the revolving credit
facility.
Subject to the terms and conditions set forth herein, the
Agent is willing to act as agent for the Lenders and each Lender is willing to
make Loans to the Borrower and participate
-2-
10
in the Letters of Credit in an aggregate amount not in excess of its Commitment
hereunder.
Accordingly, the parties hereto hereby agree as follows:
1. DEFINITIONS
For the purposes hereof unless the context otherwise requires,
all Section references herein shall be deemed to correspond with Sections
herein, the following terms shall have the meanings indicated, all accounting
terms not otherwise defined herein shall have the respective meanings accorded
to them under GAAP and all terms defined in the UCC and not otherwise defined
herein shall have the respective meanings accorded to them therein. Unless the
content otherwise requires, any of the following terms may be used in the
singular or the plural, depending on the references:
"Acceptable L/C" shall mean an irrevocable letter of credit in
form and on terms acceptable to the Agent, payable in Dollars in New York City
(or another city acceptable to the Agent) and issued or confirmed by (i) any of
the Lenders or (ii) any commercial bank that has (or which is the principal
operating subsidiary of a holding company which has as of the time such Letter
of Credit is issued) public debt outstanding with a rating of at least "A" (or
the equivalent of an "A") from one of the nationally recognized debt rating
agencies or (iii) any other bank which the Agent may in its discretion
determine to be of acceptable credit quality.
"Active Preproduction" shall be defined with respect to any
item of Product as commencing upon the earlier of (i) eight weeks prior to the
scheduled date on which principal photography with respect to such item of
Product is to commence or (ii) the date that such item of Product has been
"greenlighted" as such term is understood in the motion picture industry.
"Affiliate" shall mean any Person, which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, another Person. For purposes of this definition, a Person shall be
deemed to be "controlled by" another Person if such latter Person possesses,
directly or
-3-
11
indirectly, power either to direct or cause the direction of the management and
policies of such controlled Person whether by contract or otherwise.
"Affiliated Group" shall mean a group of Persons, each of
which is an Affiliate (other than by reason of having common directors or
officers) of some other Person in the group.
"Agent" shall mean Chemical Bank, in its capacity as agent for
the Lenders hereunder, or such successor Agent as may be appointed pursuant to
Section 11.11.
"Aggregate Credit Exposure" shall mean the aggregate Credit
Exposure of all of the Lenders.
"Agreement" shall mean this Credit, Security and Guaranty
Agreement, as amended, supplemented, or restated from time to time in
accordance with the provisions hereof.
"Allowable Amount" shall mean, with respect to any Person or
Affiliated Group, such amount as may be specified as the maximum aggregate
exposure for an Approved Account Debtor on Schedule 2, provided, however, that
(i) the Agent may from time to time by written notice to the Borrower (which
notice shall be prospective only, i.e., to the extent that reducing such
Allowable Amount for any Approved Account Debtor would otherwise result in a
mandatory prepayment by the Borrower under Section 2.12, such reduction shall
not be given effect for purposes of such Section, but such reduction shall
nevertheless be effective for all other purposes under this Agreement
immediately upon the Borrower's receipt of such notice), decrease such amount
as the Agent, acting in good faith, may in its reasonable discretion deem
appropriate or (ii) the Required Lenders may, by written notice to the
Borrower, increase such amount as they may in their discretion deem
appropriate.
"Alternate Base Rate" shall mean for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Base CD Rate in effect on
such day plus 1% and (c) the Federal Funds Effective Rate in effect for such
day plus 1/2 of 1%. For purposes hereof, "Prime Rate" shall mean the rate of
interest per annum publicly announced from time to time by the
-4-
12
Agent as its prime rate in effect at its principal office in New York City.
"Base CD Rate" shall mean the sum of (a) the product of (i) the Three-Month
Secondary CD Rate and (ii) Statutory Reserves and (b) the Assessment Rate.
"Three-Month Secondary CD Rate" shall mean, for any day, the secondary market
rate for three-month certificates of deposit reported as being in effect on
such day (or, if such day is not a Business Day, the next preceding Business
Day) by the Board through the public information telephone line of the Federal
Reserve Bank of New York (which rate will, under current practices of the
Board, be published in Federal Reserve Statistical Release H.15(519) during the
week following such day), or, if such rate shall not be so reported on such day
or such next preceding Business Day, the average of the secondary market
quotations for three-month certificates of deposit of major money center banks
in New York City received at 10:00 a.m., New York City time, on such day (or,
if such day shall not be a Business Day, on the next preceding Business Day) by
the Agent from three New York City negotiable certificate of deposit dealers of
recognized standing selected by it. "Statutory Reserves" shall mean a fraction
(expressed as a decimal), the numerator of which is the number one and the
denominator of which is the number one minus the aggregate of the maximum
reserve percentages (including any marginal, special, emergency or supplemental
reserves) expressed as a decimal established by the Board of Governors of the
Federal Reserve System of the United States and any other banking authority to
which the Agent is subject for new negotiable nonpersonal time deposits in
dollars of over $100,000 with maturities approximately equal to three months.
Statutory Reserves shall be adjusted automatically on and as of the effective
date of any change in any reserve percentage. "Federal Funds Effective Rate"
shall mean, for any day 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 on the next succeeding 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 the day of such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it. If for any reason the Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Base CD Rate or the Federal Funds Effective Rate,
or both, for any reason, including without limitation the inability or
-5-
13
failure of the Agent to obtain sufficient quotations in accordance with the
terms hereof, the Alternate Base Rate shall be determined without regard to
clause (b) or (c), or both, of the first sentence of this definition, as
appropriate, until the circumstances giving rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime
Rate, the Three-Month Secondary CD Rate or the Federal Funds Effective Rate
shall be effective on the effective date of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate,
respectively.
"Alternate Base Rate Loan" shall mean a Loan based on the
Alternate Base Rate in accordance with the provisions of Article 2.
"Applicable Law" shall mean all provisions of statutes, rules,
regulations and orders of a Governmental Authority applicable to a Person and
decisional authorities, and all effective orders and decrees of all courts and
arbitrators of Governmental Authorities in proceedings or actions in which the
Person in question is a party.
"Applicable Margin" shall mean (i) as to Borrowings under the
Term Loan Commitment (x) in the case of Alternate Base Rate Loans, 2% per annum
and (y) in the case of Eurodollar Loans, 3% per annum and (ii) as to Borrowings
under the Revolving Credit Commitment (x) in the case of Alternate Base Rate
Loans, 1/2 of 1% per annum and (y) in the case of Eurodollar Loans, 1-1/2% per
annum.
"Approved Account Debtor" shall mean any Person or Affiliated
Group identified as such on Schedule 2 hereto; provided, however, that (i) the
Agent may from time to time by written notice to the Borrower (which notice
shall be prospective only, i.e., to the extent that removing such Person or
Affiliated Group from the Approved Account Debtor list would otherwise result
in a mandatory prepayment by the Borrower under Section 2.12, such removal
shall not be given effect for purposes of such Section, but such removal shall
nevertheless be effective for all other purposes under this Agreement
immediately upon the Borrower's receipt of such notice) delete such Persons or
Affiliated Groups as the Agent, acting in good faith may in its reasonable
discretion deem appropriate and (ii) the Required
-6-
14
Lenders may add, by written notice to the Borrower, a Person or an Affiliated
Group to the list of Approved Account Debtors as they may in their discretion
deem appropriate.
"Approved Completion Guarantor" shall mean a financially sound
and reputable completion guarantor approved by the Required Lenders in their
reasonable discretion. Fireman's Fund Insurance Company acting through its
agent International Film Guarantors, L.P. (the general partner of which is
International Film Guarantors Inc.), Motion Picture Guarantors Ltd. (to the
extent the Completion Guaranty is accompanied by a Wellington Insurance Company
"cut-through"), Film Finances, Inc. (to the extent the Completion Guaranty is
accompanied by a Lloyds of London "cut-through") and Cinema Completions
International, Inc./Continental Casualty Company are hereby pre-approved as
completion guarantors; provided, however, that such pre-approval may be revoked
by the Agent if deemed appropriate in its sole discretion or if so instructed
by the Required Lenders, at any time upon 30 days prior written notice to the
Borrower; but further, provided, that such pre-approval may not be revoked with
regard to any item of Product if a Completion Guaranty has already been issued
for such item of Product.
"Assessment Rate" shall mean, for any day, the annual
assessment rate (rounded upwards, if necessary, to the next higher 1/100 of 1%)
most recently estimated by the Agent as the then current net annual assessment
rate that will be employed in determining amounts payable by the Agent to the
Federal Deposit Insurance Corporation (or any successor) for insurance by such
Corporation (or such successor) of time deposits made in Dollars at the Agent's
domestic offices.
"Assignment and Acceptance" shall mean an agreement in the
form of Exhibit G hereto, executed by the assignor, assignee and other parties
as contemplated thereby.
"Authorized Officer" shall mean, with respect to any Person,
its chief financial officer, treasurer or secretary.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of
1978, as heretofore and hereafter amended, as codified at 11 U.S.C. Section
101 et seq.
-7-
15
"Bankruptcy Plan Debt" shall mean the obligations of Old Orion
pursuant to (i) the Reimbursement Agreement dated as of October 20, 1992, among
Old Orion, ▇▇▇▇▇ and Metromedia, (ii) the Talent Notes due March 1, 1999, (iii)
the 10% Subordinated Debentures due October 31, 2001 and (iv) the Creditor
Notes due March 1, 1999.
"Board" shall mean the Board of Governors of the Federal
Reserve System.
"Borrower Pledge Agreement" shall mean the Pledge Agreement,
dated the date hereof, delivered by the Borrower to the Agent for the benefit
of the Lenders, substantially in the form of Exhibit D-1 as the same may be
amended, modified or otherwise supplemented.
"Borrowing" shall mean a group of Loans of a single Interest
Rate Type and as to which a single Interest Period is in effect on a single
date.
"Borrowing Base" shall mean an amount equal to the sum,
without double-counting, of:
(a) 100% of the Other Receivables which are guaranteed by
Metromedia; provided that the amount included in the
Borrowing Base at any time shall not exceed
$20,000,000 in the aggregate for all such
receivables; plus
(b) 100% of the Other Receivables which are supported by
an Acceptable L/C; plus
(c) 90% of the Domestic Receivables; plus
(d) 85% of the Foreign Receivables; plus
(e) 50% of Other Receivables not included in clause (a)
or (b) above; provided that the amount included in
the Borrowing Base at any time shall not exceed
$5,000,000 in the aggregate for all such receivables
or $175,000 for any obligor; plus
(f) the Library Credit.
-8-
16
"Borrowing Base Calculation Date" shall mean the monthly
closing date of the Borrower for accounting purposes, but such date shall be no
later than the last Business Day of each month.
"Borrowing Base Certificate" shall be as defined in Section
5.1(e).
"Borrowing Base Delivery Date" shall mean the 20th day of each
calendar month after the date hereof based upon the prior month's Borrowing
Base Calculation Date provided that if any such day shall not be a Business
Day, the Borrowing Base Delivery Date shall be the next succeeding Business Day
and provided further that the Borrower may, at its option deliver Borrowing
Base Certificates more frequently.
"Borrowing Base Ratio" shall mean, at any date of
determination, the ratio of (i) the amount of the Receivables Borrowing Base as
reflected on the most recently delivered Borrowing Base Certificate, to (ii)
the aggregate amount of Term Loans outstanding at such date.
"Borrowing Certificate" shall mean the borrowing certificate,
substantially in the form of Exhibit K hereto, to be delivered by the Borrower
to the Agent in connection with each Borrowing.
"Budgeted Negative Cost" shall mean, with respect to any item
of Product, the amount of the cash budget (stated in Dollars) for such item of
Product including all costs customarily included in connection with the
acquisition of all underlying literary and musical rights with respect to such
item of Product and in connection with the preparation, production and
completion of such item of Product including costs of materials, equipment,
physical properties, personnel and services utilized in connection with such
item of Product, both "above-the-line" and "below-the-line", any Completion
Guaranty fee, and all other items customarily included in negative costs, but
excluding a contingency of up to 10%, production fees and overhead charges
payable to a Credit Party, finance charges and interest expense.
"Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banks are permitted to
-9-
17
close in the State of New York, the State of California or in Amsterdam, The
Netherlands; provided, however, that when used in connection with a Eurodollar
Loan, the term "Business Day" shall also exclude any day on which banks are not
open for dealings in Dollar deposits on the London Interbank Market.
"Capital Expenditures" shall mean, with respect to any Person
for any period, the sum of the aggregate of all expenditures (whether paid in
cash or accrued as a liability) by such Person during that period which, in
accordance with GAAP, are or should be included in "additions to property,
plant or equipment or similar items included in cash flows" (including Capital
Leases); provided, however, that Capital Expenditures shall not include
expenditures of proceeds of insurance settlements in respect of lost, destroyed
or damaged assets, equipment or other property to the extent such expenditures
are made to replace or repair such lost, destroyed or damaged assets, equipment
or other property within twelve months of such destruction or damage.
"Capital Lease" shall mean, as applied to any Person, any
lease of any property (whether real, personal or mixed) by that Person as
lessee which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Cash Collateral Account" shall be as defined in Section 10.1.
"Cash Equivalents" shall mean (i) marketable 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 twelve months from the date of acquisition, (ii)
time deposits, certificates of deposit or acceptances of a Lender, or any
commercial bank having a short-term deposit rating of at least A-1 or the
equivalent thereof by Standard & Poor's Corporation or at least P-1 or the
equivalent thereof by Moody's
-10-
18
Investors Service, Inc. with maturities of not more than twelve months from the
date of acquisition, or (iii) commercial paper rated at least A-2 or the
equivalent thereof by Standard & Poor's Corporation or at least P-2 or the
equivalent thereof by ▇▇▇▇▇'▇ Investors Service, Inc. and in each case maturing
within twelve months after the date of acquisition.
"Chemical Clearing Account" shall mean the account of the
Agent (for the benefit of the Lenders) maintained at the office of the Agent at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, designated as the "Orion
Pictures Corporation Agent Bank Clearing Account", Account No. 144-816770.
"Closing Date" shall mean the date on which (i) the Agent
shall have received counterparts of this Agreement executed by the Borrower,
each of the Corporate Guarantors as of such date, the Agent and each of the
Lenders as of such date, (ii) the conditions for the initial Loan or Letter of
Credit have been satisfied and (iii) the initial Loan is made hereunder.
"Code" shall mean the Internal Revenue Code of 1986 and the
rules, regulations and notices issued thereunder, as heretofore and hereafter
amended, as codified at 26 U.S.C. Section 1 et seq or any successor provision
thereto.
"Collateral" shall mean, with respect to each Credit Party,
all of such Credit Party's right, title and interest in personal property,
tangible and intangible, wherever located or situated and whether now owned or
hereafter acquired by such Credit Party, including but not limited to all
goods, accounts, intercompany obligations, contract rights, general
intangibles, equipment, copyrights and any proceeds thereon or income
therefrom, further including but not limited to all of such Credit Party's
right, title and interest in and to each and every item of Product, the
scenario, screenplay or script upon which an item of Product is based, all of
the properties thereof, tangible and intangible, and all domestic and foreign
copyrights and all other rights therein and thereto, of every kind and
character, whether now in existence or hereafter to be made or produced, and
whether or not in possession of such Credit Party, including with respect to
each and every item of Product and without limiting the foregoing language,
each and all of the following particular rights and properties (to the extent
they are owned or hereafter created or acquired by such Credit Party):
(i) all scenarios, screenplays and/or scripts at
every stage thereof;
-11-
19
(ii) all common law and/or statutory copyright and
other rights in all literary and other properties (hereinafter
called "said literary properties") which form the basis of
each item of Product and/or which are and/or will be
incorporated into each item of Product, all component parts of
each item of Product consisting of said literary and other
properties, all motion picture rights in and to the story, all
treatments of said story and other literary material, together
with all preliminary and final screenplays used and to be used
in connection with each item of Product, and all other
literary material upon which each item of Product is based or
from which it is adapted;
(iii) all motion picture rights in and to all music
and musical compositions used and to be used in each item of
Product, including, without limitation, all rights to record,
rerecord, produce, reproduce or synchronize all of said music
and musical compositions in and in connection with motion
pictures;
(iv) all tangible personal property relating to
each item of Product, including, without limitation, all
exposed film, developed film, positives, negatives, prints,
positive prints, answer prints, special effects, preparing
materials (including interpositives, duplicate negatives,
internegatives, color reversals, intermediates, lavenders,
fine grain master prints and matrices, and all other forms of
pre-print elements), sound tracks, cutouts, trims and any and
all other physical properties of every kind and nature
relating to such item of Product, whether in completed form or
in some state of completion, and all masters, duplicates,
drafts, versions, variations and copies of each thereof, in
all formats whether on film, videotape, disk or otherwise and
all music sheets and promotional materials relating to such
item of Product (collectively, the "Physical Materials");
(v) all collateral, allied, subsidiary and
merchandising rights appurtenant or related to each item of
Product including, without limitation, the following rights:
all rights to produce remakes or
-12-
20
sequels to each item of Product based upon each item of
Product, said literary properties or the theme of each item of
Product and/or the text or any part of said literary
properties; all rights throughout the world to broadcast,
transmit and/or reproduce by means of television (including
commercially sponsored, sustaining and subscription or "pay"
television) or by any process analogous thereto, now known or
hereafter devised, each item of Product or any remake or
sequel to such item of Product; all rights to produce
primarily for television or similar use a motion picture or
series of motion pictures, by use of film or any other
mechanical recording devise now known or hereafter devised,
based upon each item of Product, said literary properties or
any part thereof, including, without limitation, all
properties based upon any script, scenario or the like used in
each item of Product; all merchandising rights including,
without limitation, all rights to use, exploit and license
others to use and exploit any and all commercial tieups of any
kind arising out of or connected with said literary
properties, each item of Product, the title or titles of each
item of Product, the characters of each item of Product or
said literary properties and/or the names or characteristics
of said characters and including further, without limitation,
any and all commercial exploitation in connection with or
related to each item of Product, any remake or sequel thereof
and/or said literary properties;
(vi) all statutory copyrights, domestic and
foreign, obtained or to be obtained on the initial item of
Product, together with any and all copyrights obtained or to
be obtained in connection with each item of Product or any
underlying or component elements of such item of Product,
including, without limitation, all copyrights on the property
described in subparagraphs (i) through (v) inclusive, of this
paragraph, together with the right to copyright and all rights
to renew or extend such copyrights and the right to sue for
past, present and future infringements of copyrights;
-13-
21
(vii) all insurance policies connected with each
item of Product and all proceeds which may be derived
therefrom;
(viii) all rights to distribute, sell, rent, license
the exhibition of and otherwise exploit and turn to account
each item of Product, the negatives, sound tracks, prints and
motion picture rights in and to said story, other literary
material upon which each item of Product is based or from
which it is adapted, and said music and musical compositions
used or to be used in each item of Product;
(ix) any and all sums, proceeds, money, products,
profits or increases, including money profits or increases (as
those terms are used in the UCC or otherwise) or other
property obtained or to be obtained from the distribution,
exhibition, sale or other uses or dispositions of each item of
Product or any part of each item of Product, including,
without limitation, all proceeds, profits, products and
increases, whether in money or otherwise, from the sale,
rental or licensing of each item of Product and/or any of the
elements of each item of Product including from collateral,
allied, subsidiary and merchandising rights;
(x) the dramatic, nondramatic, stage, television,
radio and publishing rights, title and interest in and to each
item of Product, and the right to obtain copyrights and
renewals of copyrights therein;
(xi) the title of each item of Product and all
rights of such Credit Party to the use thereof, including,
without limitation, rights protected pursuant to trademark,
service mark, unfair competition and/or the rules and
principles of law and of any other applicable statutory,
common law, or other rule or principle of law;
(xii) any and all contract rights and/or chattel
paper which may arise in connection with each item of Product;
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(xiii) all accounts and/or other rights to payment
which such Credit Party presently owns or which may arise in
favor of such Credit Party in the future, including, without
limitation, any refund under a completion guaranty, all
accounts and/or rights to payment due from exhibitors in
connection with the distribution of each item of Product, and
from exploitation of any and all of the collateral, allied,
subsidiary, merchandising and other rights in connection with
each item of Product;
(xiv) any and all "general intangibles" (as that
term is defined in the UCC) not elsewhere included in this
definition, including, without limitation, any and all general
intangibles consisting of any right to payment which may arise
in the distribution or exploitation of any of the rights set
out herein, and any and all general intangible rights in favor
of such Credit Party or the Lenders for services or other
performances by any third parties, including actors, writers,
directors, individual producers and/or any and all other
performing or nonperforming artists in any way connected with
each item of Product, any and all general intangible rights in
favor of such Credit Party or the Lenders relating to licenses
of sound or other equipment, and licenses for photographic or
other processes, and any and all general intangibles related
to the distribution or exploitation of each item of Product
including general intangibles related to or which grow out of
the exhibition of each item of Product and the exploitation of
any and all other rights in each item of Product set out in
this definition;
(xv) any and all goods including inventory (as
that term is defined in the UCC) which may arise in connection
with the creation, production or delivery of each item of
Product and which goods pursuant to any production or
distribution agreement or otherwise are owned by such Credit
Party;
(xvi) all and each of the rights, regardless of
denomination, which arise in connection with the
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creation, production, completion of production, delivery,
distribution, or other exploitation of each item of Product,
including, without limitation, any and all rights in favor of
such Credit Party, the ownership or control of which are or
may become necessary in the opinion of the Agent, in order to
complete production of each item of Product in the event that
the Agent exercises any rights it may have to take over and
complete production of each item of Product;
(xvii) any and all documents issued by any
pledgeholder or bailee with respect to each item of Product,
the negatives, sound tracks or prints (whether or not in
completed form) with respect thereto;
(xviii) any and all production accounts or other bank
accounts established by such Credit Party with respect to such
item of Product;
(xix) any and all rights of such Credit Party under
contracts relating to the production of each item of Product;
(xx) any and all rights of such Credit Party under
Distribution Agreements relating to each item of Product; and
(xxi) the Pledged Securities.
"Collection Account" shall mean each account of the Borrower
maintained either at the office of the Agent at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ or at the office of a Collection Bank, other than the
Concentration Account.
"Collection Bank" shall mean a bank acceptable to the Agent.
"Collection Account Letter" shall mean a collection account
letter in form and substance satisfactory to the Agent, which letter shall be
executed with respect to a Collection Account by a Credit Party or a Special
Purpose Distributor in order to effectuate the provisions of Section 8.3
hereof.
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"Commitment" shall mean the Term Loan Commitment and the
Revolving Credit Commitment of each Lender up to an aggregate amount, at any
one time, not in excess of the amount set forth (i) opposite its name under the
column entitled "Total Commitment" in the Schedule of Commitments appearing in
Schedule 1 hereto, or (ii) in any applicable Assignment and Acceptance(s) to
which it may be a party, as the case may be, as such amount may be reduced from
time to time in accordance with the terms of this Agreement.
"Commitment Fee" shall be as defined in Section 2.7.
"Completed" and "Completion" shall mean, with respect to any
item of Product, that (i) sufficient elements have been delivered to, and
accepted by, a Person (other than the Borrower or an Affiliate thereof) to
permit such Person to exhibit or distribute the item of Product in the initial
market for which the item of Product is intended to be exhibited or distributed
or (ii) (x) if the item of Product is initially intended to be exhibited or
distributed in the theatrical market, the Borrower has certified to the Agent
that an independent Laboratory has in its possession a complete final 35-mm
composite positive print of the item of Product as finally cut, main and end
titled, edited, scored and assembled with sound track printed thereon in
perfect synchronization with the photographic action and fit and ready for
theatrical exhibition and distribution or (y) if the item of Product is
initially intended to be exhibited or distributed to the television or home
video market, the Borrower has certified to the Agent that an independent
Laboratory has in its possession a video master of the item of Product that is
fit and ready for television and/or home video exhibition and distribution,
provided that, in either case, if such certification shall not be verified to
the Agent by such independent laboratory within 20 Business Days thereafter,
such item of Product shall revert to being un-completed until the Agent
receives such verification or (iii) the item of Product has been actually
exhibited or distributed in the market for which it was intended to be
initially exhibited or distributed.
"Completion Guaranty" shall mean a motion picture completion
guaranty, in form and substance satisfactory to the Agent, issued by an
Approved Completion Guarantor which guarantees that the item of Product will be
Completed in a timely
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manner, or else payment made to the Agent on behalf of the Lenders of an amount
at least equal to the aggregate amount expended on the production of such item
of Product by or on behalf of any Credit Party plus interest on, and other bank
charges with respect to, such amount.
"Concentration Account" shall mean the account of the Borrower
maintained at the office of the Agent at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇-▇▇▇▇ designated as Orion Pictures Corporation Concentration Account,
Account No. 323-212050.
"Consolidated Subsidiaries" shall mean all Subsidiaries of the
Borrower that are required to be consolidated with the Borrower for financial
reporting purposes in accordance with GAAP.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower and its Subsidiaries, are
treated as a single employer under Section 414(b), (c), (m) or (o) of the Code.
"Copyright Security Agreement" shall mean a Copyright Security
Agreement, substantially in the form of Exhibit B-1, as the same may be amended
or supplemented from time to time by delivery of a Copyright Security Agreement
Supplement or otherwise.
"Copyright Security Agreement Supplement" shall mean a
Copyright Security Agreement Supplement, substantially in the form of Exhibit
B-2.
"Corporate Guarantors" shall mean all corporate Subsidiaries
of the Borrower (other than the Excluded Subsidiaries) now existing or
hereafter acquired or formed.
"Credit Exposure" shall mean, without duplication, with
respect to any Lender, the sum of such Lender's (i) aggregate outstanding Loans
hereunder, (ii) Pro Rata Share of the then current L/C Exposure, and (iii) the
amount by which the sum of such ▇▇▇▇▇▇'s Revolving Credit Commitment exceeds
the sum of its
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Revolving Credit Loans plus its Pro Rata Share of the then current L/C
Exposure.
"Credit Party" shall mean the Borrower or any of the Corporate
Guarantors.
"Cumulative Film Investment" shall mean, at any date for which
it is to be determined, the aggregate amount of the Borrower's and its
Consolidated Subsidiaries' investment in Product (including capitalized
distribution expenditures) from October 1, 1995 through such date treated as a
single accounting period as determined in accordance with GAAP.
"Currency Agreement" shall mean any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic cap or
other similar agreement designed to protect the Borrower against fluctuations
in currency values.
"Default" shall mean a Term Loan Default or a Revolving Loan
Default, as the context requires.
"Department of Labor" shall mean the United States Department
of Labor.
"Distribution Agreement" shall mean any agreement entered into
by the Borrower or a Subsidiary of the Borrower or a Special Purpose
Distributor pursuant to which the Borrower or such Subsidiary or such Special
Purpose Distributor has licensed, leased, assigned or sold distribution or
other exploitation rights to any item of Product in any media or territory to
an un-Affiliated Person.
"Distributor Security Documents" shall mean individually or
together, as the context so requires, any and all assignment agreement(s),
security Agreement(s), pledge agreement(s) film lease agreement(s) or other
documentation pursuant to which a Person who is hereafter approved by the Agent
to be a Special Purpose Distributor grants a security interest in, or grants
any right(s) relating to, an item of Product to a Credit Party, another Special
Purpose Distributor or the Agent (for the benefit of the Lenders) and/or
pursuant to which any such security interest or other right(s) is assigned to a
Credit Party or the Agent for the benefit of the Lenders, provided, that
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any and all such agreement(s) and document(s) are in form and substance
satisfactory to the Agent.
"Dollars" and "$" shall mean lawful money of the United States
of America.
"Domestic Receivables" shall mean Eligible Receivables from
Approved Account Debtors whose principal place of business and jurisdiction of
incorporation or formation are located within the United States.
"Eligible Receivables" shall mean, at any date at which the
amount thereof is to be determined, an amount equal to the sum of the present
values (discounted, in the case of amounts which are not due and payable within
12 months following the date of determination, on a quarterly basis by a rate
of interest equal to the greater of (x) the Alternate Base Rate in effect on
the date of the computation or (y) 10% per annum) of (a) all net amounts which
pursuant to a binding agreement are contractually obligated to be paid to any
Credit Party (either directly or through a Special Purpose Distributor) either
unconditionally or subject only to normal delivery requirements or other
conditions solely within the Credit Party's control, and which are reasonably
expected by the Credit Party to be payable and collected from Approved Account
Debtors (including, without limitation, amounts which a distributor has
reported to the Credit Party in writing (and such report has been forwarded to
the Agent) will be paid to the Credit Party following receipt by the
distributor of sums contractually obligated to be paid to the distributor from
third parties) minus (except in the case of Other Receivables which are
included in the Borrowing Base pursuant to clause (e) of the definition of the
Borrowing Base) (b) the sum of (i) the following items attributable to the
amounts referred to in clause (a) (based on the Credit Party's then best
estimates): minimum guarantees or advances payable by the Credit Party, third
party profit participations, residuals, commissions, foreign withholding,
remittance and similar taxes chargeable in respect of such accounts receivable,
and (ii) the outstanding amount of unrecouped advances to the extent subject to
repayment or adjustment from the amounts referred to in clause (a) pursuant to
approved Distribution Agreements, but Eligible Receivables shall not include
amounts which:
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(i) in the aggregate due from a
single Affiliated Group are in excess of the
Allowable Amount with respect to such Affiliated
Group;
(ii) to the extent such
receivables are more than 90 days past due in the
case of a domestic Approved Account Debtor and 120
days past due in the case of a foreign Approved
Account Debtor;
(iii) the portion of any
receivable which is not payable on or before December
31, 2000;
(iv) are in excess of 7-1/2% of
the Receivable Borrowing Base if they are to be paid
in a currency other than United States Dollars;
(v) may not be freely withdrawn
from the country where paid;
(vi) have been included in the
Borrower's estimated bad debts;
(vii) any receivable amount from
any (x) domestic obligor which has any receivable
amount from such obligor 120 or more days past due or
(y) any foreign obligor which has any receivable
amount from such obligor 150 or more days past due
(excluding for purposes hereof any receivable
designated by the Borrower on the Closing Date as a
"disputed receivable", any receivable amount
designated by the Borrower after the Closing Date as
such provided that such amount does not exceed
$20,000 for any obligor or any receivable amount that
is being disputed or contested in good faith);
(viii) for which there is bona fide
request for a material credit, adjustment,
compromise, offset, counterclaim or dispute;
provided, however, that only the amount in question
shall be excluded from such receivable;
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(ix) are attributable to an item
of Product in which the Borrower cannot warrant
sufficient title to the underlying rights to justify
such receivable;
(x) are attributable to an item
of Product that was acquired from a third party and
(x) the entire acquisition price or minimum advance
for such item of Product shall not have been paid to
the extent then due or (y) the third party has a
contractual right to terminate the acquisition
agreement;
(xi) the Agent (for the benefit
of the Lenders) does not have a first perfected
security interest in such receivable subject only to
guild liens on certain Product securing only
residuals payable on each such item of Product on a
non-crosscollateralized basis;
(xii) relate to Product as to
which the Agent has not received two fully executed
copies of a Laboratory Access Letter or a
Pledgeholder Agreement for Laboratories holding
physical elements sufficient to fully exploit the
rights held by the Credit Party in such Product;
(xiii) any receivable (x)
attributable to an item of Product which is subject
to reduction because the obligor thereunder has not
recouped a minimum advance that such obligor paid
with respect to another item of Product or (y) that
is otherwise subject to contractual rights of offset
or reduction by the obligor;
(xiv) are attributable to Product
which has not been Completed;
(xv) in the sole and reasonable
discretion of the Agent, contain a material
performance obligation on the part of the Credit
Party where such obligation is contingent upon
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future events not within the Credit Party's absolute
control; or
(xvi) any other receivable which
is reasonably determined by the Agent or Required
Lenders to be unacceptable.
"Environmental Laws" shall mean any and all federal, state,
local or municipal laws, rules, orders, regulations, statutes, ordinances,
codes, decrees or requirements of any Governmental Authority regulating,
relating to or imposing liability or standards of conduct concerning any
Hazardous Material or environmental protection or health and safety, without
limitation, the Clean Water Act also known as the Federal Water Pollution
Control Act ("FWPCA"), 33 U.S.C. Section 1251 et seq., the Clean Air Act
("CAA"), 42 U.S.C. Section Section 7401 et seq., the Federal Insecticide,
Fungicide and Rodenticide Act ("FIFRA"), 7 U.S.C. Section Section 136 et seq.,
the Surface Mining Control and Reclamation Act ("SMCRA"), 30 U.S.C. Section
Section 1201 et seq. the Comprehensive Environmental Response, Compensation
and Liability Act ("CERCLA"), 42 U.S.C. Section 9601 et seq., the Superfund
Amendment and Reauthorization Act of 1986 ("▇▇▇▇"), Public Law 99-499, 100
Stat. 1613, the Emergency Planning and Community Right to Know Act ("ECPCRKA"),
42 U.S.C. Section 11001 et seq., the Resource Conservation and Recovery Act
("RCRA"), 42 U.S.C. Section 6901 et seq., the Occupational Safety and Health
Act, as amended ("OSHA"), 29 U.S.C. Section 655 and Section 657, together, in
each case, with any amendment thereof, and the regulations adopted and the
publications promulgated thereunder and all substitutions thereof.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974 and the regulations promulgated thereunder, in each case, as amended
from time to time.
"Eurodollar Loan" shall mean a loan based on the LIBO Rate in
accordance with the provisions of Article 2.
"Event of Default" shall mean a Term Loan Event of Default or
a Revolving Loan Event of Default, as the context requires.
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"Executive Officer" shall mean an "executive officer", as such
term is defined for purposes of Regulation S-K under the Securities Exchange
Act of 1934, as amended.
"Excluded Subsidiaries" shall mean (i) Mintaka Films B.V., a
wholly-owned subsidiary of the Borrower, organized under the laws of the
Netherlands and (ii) each Inactive Subsidiary.
"Fee Letter" shall mean that certain letter agreement dated
September 7, 1995 between Old Orion and the Agent, relating to the payment of
certain fees by the Borrower as the successor to Old Orion.
"Foreign Receivables" shall mean all Eligible Receivables
which are not Domestic Receivables.
"Free Cash Flow" shall mean, at any date for which it is to be
determined, the aggregate amount of the Borrower's and its Consolidated
Subsidiaries' Operating Cash Flow plus any net investment (whether as equity or
Subordinated Indebtedness) by the Parent in the Borrower, minus the sum of (i)
all Capital Expenditures and Investments (other than Investments in Product)
and (ii) actual debt repayments (other than repayments of Revolving Credit
Loans), from October 1, 1995 through such date treated as a single accounting
period as determined in accordance with GAAP.
"Fundamental Documents" shall mean this Agreement, the Notes,
the Pledgeholder Agreements, the Copyright Security Agreement, the Copyright
Security Agreement Supplements, the Pledge Agreements, the Pledge Agreement
Supplements, the Subordination Agreements, the Guaranty Agreement, the
Instruments of Assumption and Joinder, the Notices of Assignment and
Irrevocable Instruction, the Distributor Security Documents, or any other
ancillary document which is required or otherwise executed in connection with
this Agreement or any other Fundamental Document.
"GAAP" shall mean generally accepted accounting principles
consistently applied (except for accounting changes in response to FASB
releases or other authoritative pronouncements); provided, however, compliance
with the financial covenants
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contained in Sections 6.20 through 6.24 shall be based on such GAAP as were in
effect on September 7, 1995.
"Governmental Authority" shall mean any federal, state,
municipal or other governmental department, commission, board, bureau, agency,
or instrumentality, or other court or arbitrator, in each case whether of the
United States or a foreign jurisdiction.
"Guaranteed Obligations" shall mean all the Obligations of the
Borrower.
"Guaranty" shall mean, as to any Person, any direct or
indirect obligation of such Person guaranteeing any Indebtedness, Capital
Lease, dividend or other monetary obligation ("primary obligation") 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, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (a) for the purchase or payment of any such primary obligation or
(b) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii)
to purchase property, securities or services, in each case, primarily for the
purpose of assuring the owner of any such primary obligation of the repayment
of such primary obligation or (iv) as a general partner of a partnership or a
joint venturer of a joint venture in respect of Indebtedness of such
partnership or such joint venture which is treated as a general partnership for
purposes of Applicable Law except to the extent that such Indebtedness of such
partnership or joint venture is nonrecourse to such Person. The amount of any
Guaranty shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guaranty is made or,
if not stated or determinable, the maximum reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder). The
term "Guaranty" shall not include the endorsement for deposit or collection in
the ordinary course of business.
"Guaranty Agreement" shall mean the Guaranty Agreement, dated
the date hereof, delivered by the Guarantors to the Agent
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33
for the benefit of the Lenders, substantially in the form of Exhibit M, as the
same may be amended, modified or otherwise supplemented.
"Hazardous Materials" shall mean any flammable materials,
explosives, radioactive materials, hazardous materials, hazardous wastes,
hazardous or toxic substances, or similar materials defined in any
Environmental Law.
"Inactive Subsidiary" shall mean each Subsidiary of the
Borrower listed on Schedule 3.17(c).
"Indebtedness" shall mean (without double counting), at any
time and with respect to any Person, (i) indebtedness of such Person for
borrowed money (whether by loan or the issuance and sale of debt securities) or
for the deferred purchase price of property or services purchased (other than
amounts constituting accrued expenses and trade payables (payable within 120
days) arising in the ordinary course of business); (ii) obligations of such
Person in respect of letters of credit, acceptance facilities, or drafts or
similar instruments issued or accepted by banks and other financial
institutions for the account of such Person; (iii) obligations of such Person
under Capital Leases and (iv) indebtedness of others of the type described in
clauses (i), (ii) and (iii) hereof which such Person has (a) directly or
indirectly assumed or guaranteed in connection with a Guaranty or (b) secured
by a Lien (other than Liens of carriers, warehousemens, mechanics, repairmens
or other similar non-consensual Liens arising in the ordinary course of
business) on the assets of such Person, whether or not such Person has assumed
such indebtedness.
"Initial Date" shall mean (i) in the case of the Agent, the
date hereof, (ii) in the case of each Lender which is an original party to this
Agreement, the date hereof and (iii) in the case of any other Lender, the
effective date of the Assignment and Acceptance pursuant to which it became a
Lender.
"Instrument of Assumption and Joinder" shall mean the
Instrument of Assumption and Joinder substantially in the form of Exhibit N
pursuant to which Subsidiaries of the Borrower become parties to this Agreement
as contemplated by Section 5.20.
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34
"Interest Payment Date" shall mean (i) as to any Eurodollar
Loan having an Interest Period of one, two or three months, the last day of
such Interest Period, (ii) as to any Eurodollar Loan having an Interest Period
of six months or more, the last day of an Interest Period and, in addition,
each day during such Interest Period that would have been an Interest Payment
Date had successive Interest Periods of three months' duration been applicable
to such Eurodollar Loan, and (iii) as to Alternate Base Rate Loans, the last
Business Day of each September, December, March and June.
"Interest Period" shall mean as to any Eurodollar Loan, the
period commencing on the date of such Loan or the last day of the preceding
Interest Period and ending on the numerically corresponding day (or if there is
no corresponding day, the last day) in the calendar month that is one, two,
three, six or twelve months thereafter as the Borrower may elect; provided,
however, that if any Interest Period would end on a day which shall not be a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day, unless with respect to Eurodollar Loans only, such next
succeeding Business Day would fall in the next calendar month, in which case,
such Interest Period shall end on the next preceding Business Day.
"Interest Rate Protection Agreements" shall mean any interest
rate swap agreement, interest rate cap agreement or other financial agreement
or arrangement designed to protect the Credit Parties against fluctuations in
interest rates.
"Interest Rate Type" shall be as defined in Section 2.3.
"Investment" shall include any stock, evidence of indebtedness
or other security of any Person, any loan, advance, contribution of capital
(including obligations of a partner or joint venturer to satisfy additional
capital calls), extension of credit or commitment therefor (except for current
trade and customer accounts receivable for services rendered in the ordinary
course of business and payable in accordance with customary trading terms in
the ordinary course of business), and any purchase of (i) any security of
another Person or (ii) any business or undertaking of any Person or any
commitment to make any such purchase, or any other investment.
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"Issuing Bank" shall mean Chemical Bank, a New York banking
corporation.
"Laboratory" shall mean any laboratory which is located in the
United States, Canada or United Kingdom and is reasonably acceptable to the
Agent.
"Laboratory Access Letter" shall mean a letter agreement among
(i) a laboratory holding any elements of an item of Product to which any Credit
Party has the right of access, (ii) such Credit Party and (iii) the Agent,
substantially in the form of Exhibit F or a form otherwise acceptable to the
Agent.
"L/C Exposure" shall mean, at any time, the amount expressed
in Dollars of the aggregate face amount of all drafts which may then or
thereafter be presented by beneficiaries under all Letters of Credit then
outstanding plus (without duplication) the face amount of all drafts which have
been presented under Letters of Credit but have not yet been paid or have been
paid but not reimbursed, whether directly or from the proceeds of a Loan.
"Lender" and "Lenders" shall mean the financial institutions
whose names appear on the signature pages hereof on the date hereof and any
assignee of a Lender pursuant to Section 12.3.
"Lending Office" shall mean, with respect to any of the
Lenders, the branch or branches (or affiliate or affiliates) from which any
such Lender's Eurodollar Loans or Alternate Base Rate Loans, as the case may
be, are made or maintained and for the account of which all payments of
principal of, and interest on, such ▇▇▇▇▇▇'s Eurodollar Loans or Alternate Base
Rate Loans are made, as notified to the Agent from time to time.
"Letter of Credit" shall mean a letter of credit issued
pursuant to Section 2.4.
"LIBO Rate" shall mean, with respect to the Interest Period
for a Eurodollar Loan, an interest rate per annum equal to the quotient
(rounded upwards to the next 1/16 of 1%) of (A) the rate at which Dollar
deposits approximately equal in principal amount to the Agent's portion of such
Eurodollar Loan and for a
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36
maturity equal to the applicable Interest Period are offered to the Eurodollar
Lending Office of the Agent in immediately available funds in the London
Interbank Market for Eurodollars at approximately 11:00 A.M., London time, two
Business Days prior to the commencement of such Interest Period divided by (B)
one minus the applicable statutory reserve requirements of the Agent, expressed
as a decimal (including, without duplication or limitation, basic,
supplemental, marginal and emergency reserves), from time to time in effect
under Regulation D or similar regulations of the Board of Governors of the
Federal Reserve System of the United States. It is agreed that for purposes of
this definition, Eurodollar Loans made hereunder shall be deemed to constitute
Eurocurrency Liabilities as defined in Regulation D and to be subject to the
reserve requirements of Regulation D.
"Library Credit" shall mean the lesser of (i) $35,000,000 and
(ii) 26% of the aggregate Borrowing Base at the date of determination,
representing the estimated value attributable to the unsold rights as set forth
in that certain Library Valuation Schedule dated October 1995 in various
markets and territories for the Borrower's Product, as such amount may be
reduced from time to time by the value allocable to rights licensed, sold or
otherwise exploited.
"Lien" shall mean any mortgage, copyright mortgage, pledge,
security interest, encumbrance, lien or charge of any kind whatsoever
(including any conditional sale or other title retention agreement, any lease
in the nature of security, and the filing of, or agreement to give, any
financing statement under the Uniform Commercial Code of any jurisdiction).
"Loans" shall mean the Term Loans and the Revolving Credit
Loans made hereunder in accordance with the provisions of Article 2, whether
made as a Eurodollar Loan or an Alternate Base Rate Loan, as permitted hereby.
"Margin Stock" shall have the meaning given to such term in
Regulation U of the Board.
"Material Adverse Effect" shall mean any change or effect that
(a) has a materially adverse effect on the business, assets, properties,
operations or financial condition of the
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Borrower individually or of the Borrower and its Subsidiaries, taken as a
whole, (b) materially impairs the ability of the Credit Parties to perform
their respective obligations under the Fundamental Documents to which it is a
party or (c) materially impairs the validity or enforceability of, or
materially impairs the rights, remedies or benefits available to the Lenders
under, the Fundamental Documents; provided, however, that any change or effect
will be deemed to have a "Material Adverse Effect" if and only if such change
or effect when taken together with all other current changes and effects (both
positive and negative) with respect to the Borrower individually or of the
Borrower and its Subsidiaries, taken as a whole, as the context requires
(including all other changes and effects which would cause such representation
or warranty to be untrue or such covenant to be breached but for the fact that
such representation, warranty or covenant is subject to a "Material Adverse
Effect" exception) would result in a "Material Adverse Effect", even though,
individually, such change or effect might not do so.
"Metromedia Holders" shall mean collectively Metromedia
Company, ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Met International, Inc., Met Telcell,
Inc. and MetProductions, Inc.
"Multiemployer Plan" means a Plan which is a "multiemployer
plan" as defined in Section 4001(a)(3) of ERISA.
"Negative Pickup" shall mean, with respect to any item of
Product produced by a third party, a commitment to pay a certain sum of money
or other Investment made by a Credit Party in order to obtain ownership or
distribution rights in such item of Product, but which does not require any
payment unless such person has received delivery of all items necessary to
exploit the distribution rights.
"Net Loss" shall mean, for any period, the net loss, if any,
of the Borrower and its Consolidated Subsidiaries for such period as determined
in accordance with GAAP.
"Notes" shall mean the Term Notes and the Revolving Credit
Notes.
"Notice of Assignment and Irrevocable Instructions" shall mean
the Notice of Assignment and Irrevocable Instructions
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substantially in the form of Exhibit O or in such other form as shall be
acceptable to the Agent, including without limitation the inclusion of such
notice and instructions in a Distribution Agreement.
"Obligations" shall mean the obligation to make due and
punctual payment of principal of and interest on the Loans, the Commitment
Fees, reimbursement obligations in respect of Letters of Credit, costs and
attorneys' fees and all other monetary obligations of the Borrower to the
Agent, the Issuing Bank or any Lender under this Agreement, the Notes or the
other Fundamental Documents or the Fee Letter and all amounts payable by the
Borrower to any Lender under a Currency Agreement or Interest Rate Protection
Agreement.
"Operating Cash Flow" shall mean, for any period for which it
is to be determined, the amount of "Cash provided by operations" of the
Borrower and its Consolidated Subsidiaries as determined in accordance with
GAAP.
"Other Receivables" shall mean receivables that meet all of
the requirements of an "Eligible Receivable" other than that the obligor is not
an Approved Account Debtor or the amount of such receivables exceeds the
Allowable Amount with respect to an Approved Account Debtor.
"Parent Pledge Agreement" shall mean the Pledge Agreement,
dated the date hereof, delivered by the Parent to the Agent for the benefit of
the Lenders, substantially in the form of Exhibit D-2 as the same may be
amended, modified or otherwise supplemented.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Percentage" shall mean, with respect to any Lender, its
ratable share expressed as a percentage equal to the ratio obtained by dividing
the applicable Commitment of such Lender by the applicable aggregate
Commitments of the Lenders.
"Permitted Indebtedness" shall mean the Indebtedness permitted
under Section 6.1.
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"Permitted Encumbrances" shall mean Liens permitted under
Section 6.6.
"Person" shall mean any natural person, corporation, division
of a corporation, limited liability company, partnership, trust, joint venture,
association, company, estate, unincorporated organization or government or any
agency or political subdivision thereof.
"Plan" shall mean an "employee pension benefit plan" as
defined in Section 3(2) of ERISA maintained by the Borrower or any member of
the Controlled Group, or to which the Borrower or any member of the Controlled
Group contributes or is required to contribute or any other plan covered by
Title IV of ERISA.
"Pledge Agreements" shall mean collectively (i) the Parent
Pledge Agreement, (ii) the Borrower Pledge Agreement and (iii) the Subsidiary
Pledge Agreements.
"Pledge Agreement Supplement" shall mean a Pledge Agreement
Supplement, substantially in the form of Exhibit D-4.
"Pledged Securities" shall be as defined in the Pledge
Agreements.
"Pledgeholder Agreement" shall mean a laboratory pledgeholder
agreement with respect to an item of Product among the appropriate Credit
Party, the Agent, an Approved Completion Guarantor for such item of Product (if
the Product is not completed) and one or more laboratories substantially in the
form of Exhibit C-1 or Exhibit C-2, as the case may be, or in such other form
as shall be acceptable to the Agent.
"Priority and Contribution Agreement" shall mean the Priority
and Contribution Agreement substantially in the form of Exhibit L, as such
Priority and Contribution Agreement may be amended, supplemented or otherwise
modified from time to time.
"Product" shall mean any motion picture, film or video tape
produced for theatrical, non-theatrical, television or video release or for
release in any other medium, in each case whether recorded on film, videotape,
cassette, cartridge, disc or on or by any other means, method, process or
device whether now known
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or hereafter developed, with respect to which a Credit Party (i) is the initial
copyright owner or (ii) has acquired or has contracted to acquire an equity
interest or distribution rights. The term "item of Product" shall include,
without limitation, the scenario, screenplay or script upon which such Product
is based, all of the properties thereof, tangible and intangible, and whether
now in existence or hereafter to be made or produced, whether or not in
possession of the Credit Parties, and all rights therein and thereto, of every
kind and character.
"Pro Rata Share" shall mean, with respect to any Obligation or
other amount, each Lender's pro rata share of such Obligation or other amount
determined in accordance with such Lender's Percentage.
"Quiet Enjoyment" shall be as defined in Section 8.13.
"Receivables Borrowing Base" shall mean, at any date for which
it is to be determined, the amount of the Borrowing Base exclusive of the
Library Credit adjusted to include any Eligible Receivable or any portion
thereof which is payable on or before December 31, 2003.
"Regulation D" shall mean Regulation D of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation G" shall mean Regulation G of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation U" shall mean Regulation U of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation X" shall mean Regulation X of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Reportable Event" shall mean any reportable event as defined
in Section 4043 of ERISA.
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"Required Lenders" shall mean Lenders whose then outstanding
Credit Exposure collectively equals at least 66-2/3% of the Aggregate Credit
Exposure; except in the case of waivers or amendments affecting Section 6.15
and Section 6.18, in which event Required Lenders shall equal at least 51%.
"Restricted Payment" shall mean (i) any distribution, dividend
or other direct or indirect payment on account of shares of any class of stock
of, partnership interest in, or any other equity interest of, a Credit Party,
other than a dividend, distribution or other payment payable solely in
additional shares of common stock, (ii) any redemption or other acquisition,
re-acquisition or retirement by a Credit Party of any class of its own stock or
other equity interest of a Credit Party or an Affiliate, now or hereafter
outstanding, (iii) any payment made to retire, or obtain the surrender of any
outstanding warrants, puts or options or other rights to purchase or acquire
shares of any class of stock of, or any equity interest of a Credit Party, now
or hereafter outstanding and (iv) any payment by a Credit Party of principal
of, premium, if any, or interest on, or any redemption, purchase, retirement,
defeasance, sinking fund or similar payment with respect to, any Subordinated
Indebtedness now or hereafter outstanding.
"Revolving Credit Commitment" shall mean the commitment of
each Lender to make Revolving Credit Loans to the Borrower and to participate
in Letters of Credit from the Initial Date applicable to such Lender through
the Revolving Credit Commitment Termination Date up to an aggregate amount, at
any one time, not in excess of the amount set forth (i) opposite its name under
the column entitled "Revolving Credit Commitment" in the Schedule of
Commitments appearing in Schedule 1, or (ii) in any applicable Assignment and
Acceptance(s) to which it may be a party, as the case may be, as such amount
may be reduced from time to time in accordance with the terms of this
Agreement.
"Revolving Credit Commitment Termination Date" shall mean the
earliest to occur of: (i) December 31, 2000 or (ii) such earlier date on which
the Revolving Credit Commitment shall terminate in accordance with Section 2.8
or Section 7.2.
"Revolving Credit Loans" shall be as defined in Section 2.1.
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"Revolving Credit Notes" shall be as defined in Section 2.5.
"Revolving Loan Default" shall mean any event, act or
condition which with notice or lapse of time, or both, would constitute a
Revolving Loan Event of Default.
"Revolving Loan Events of Default" shall have the meaning
given such term in Section 7.2.
"SEC Filings" shall mean collectively:
(i) Old Orion's Annual Report on Form 10-K for the fiscal
year ended February 28, 1995 and Form 10-K/A Amendment No. 1 filed on June 28,
1995 amending Old Orion's Form 10-K for the fiscal year ended February 28,
1995;
(ii) Old Orion's Quarterly Report on Form 10-Q for the
quarter ended May 31, 1995;
(iii) Old Orion's Quarterly Report on Form 10-Q for the
quarter ended August 31, 1995;
(iv) Old Orion's Current Report on Form 8-K dated August
31, 1995;
(v) Old Orion's Current Report on Form 8-K dated
September 7, 1995;
(vi) Old Orion's Current Report on Form 8-K dated
September 27, 1995; and
(vii) the Joint Proxy Statement dated September 28, 1995 of
Actava, Old Orion, ▇▇▇▇ and MCEG, as supplemented by the Supplement dated
October 16, 1995.
"Special Purpose Distributor" shall mean any Person that
pursuant to Section 6.26 hereof, is hereafter approved by the Agent to be a
Special Purpose Distributor.
"Subordinated Indebtedness" shall mean any Indebtedness of the
Borrower as to which the obligee of such Indebtedness has agreed in writing,
pursuant to the Subordination Agreement or on
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terms otherwise acceptable to the Required Lenders in their sole discretion, to
be subordinate and junior in right of payment to the rights of the Lenders with
respect to the Obligations.
"Subordination Agreement" shall mean collectively (i) the
Subordination Agreement dated the date hereof, among the Borrower, Metromedia,
▇▇▇▇▇ and the Agent and (ii) the Subordination Agreement dated the date hereof,
among the Borrower, certain Affiliates of the Borrower party thereto and the
Agent, each substantially in the form of Exhibit E, as the same may be amended,
supplemented or modified by from time to time.
"Subsidiary" shall mean with respect to any Person, any
corporation, limited liability company, association, joint venture, partnership
or other business entity (whether now existing or hereafter organized) of which
at least a majority of the voting stock or other ownership interests having
ordinary voting power for the election of directors (or the equivalent) is, at
the time as of which any determination is being made, owned or controlled by
such Person or one or more Subsidiaries of such Person or by such Person and
one or more Subsidiaries of such Person.
"Subsidiary Pledge Agreements" shall mean the Pledge
Agreements, dated the date hereof, delivered by each Corporate Guarantor that
owns a Subisidiary to the Agent for the benefit of the Lenders, each
substantially in the form of Exhibit D-3, as the same may be amended, modified
or otherwise supplemented.
"Term Loan Commitment" shall mean the commitment of each
Lender to make Term Loans to the Borrower up to an aggregate amount, at any one
time, not in excess of the amount set forth (i) opposite its name under the
column entitled "Term Loan Commitment" in the Schedule of Commitments appearing
in Schedule 1, or (ii) in any applicable Assignment and Acceptance(s) to which
it may be a party, as the case may be, as such amount may be reduced from time
to time in accordance with the terms of this Agreement.
"Term Loan Default" shall mean any event, act or condition
which with notice or lapse of time, or both, would constitute a Term Loan Event
of Default.
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"Term Loan Events of Default" shall have the meaning given
such term in Section 7.1.
"Term Loans" shall be as defined in Section 2.2.
"Term Notes" shall be as defined in Section 2.5.
"Total Commitment" shall mean the aggregate amount of the
Commitments then in effect, of all of the Lenders as such amount may be reduced
from time to time in accordance with the terms of this Agreement.
"UCC" shall mean the Uniform Commercial Code as in effect in
the State of New York on the date of execution of this Agreement.
"Unrecouped Print and Advertising Expense" shall mean, with
respect to an item of Product initially released after the date hereof, an
amount equal to (a) total print and advertising expenses minus (b) the sum of
(i) total billed receivables, plus (ii) total receipts plus (iii) estimated
receivables computed on the basis of 40% of reported box office receipts for
engagements which have not yet been billed or collected minus (c) any such
expenses which have been written off.
"Welfare Plan" shall mean each "employee welfare benefit plan"
as defined in Section 3(1) of ERISA maintained by the Borrower or any member of
the Controlled Group, or to which the Borrower or any member of the Controlled
Group contributes or is required to contribute.
2. THE LOANS
SECTION 2.1. Revolving Credit Loans.
(a) Each Lender, severally and not jointly, agrees, upon
the terms and subject to the conditions hereof, to make loans (the "Revolving
Credit Loans") to the Borrower, on any Business Day and from time to time from
the Closing Date to but excluding the Revolving Credit Commitment Termination
Date, each in an aggregate principal amount which when added to the aggregate
principal amount of all Revolving Credit Loans then outstanding to the Borrower
from such Lender, plus such Lender's
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Pro Rata Share of the then current L/C Exposure does not exceed such ▇▇▇▇▇▇'s
Revolving Credit Commitment (after giving effect to all Revolving Credit Loans
repaid and all reimbursements of Letters of Credit made concurrently with the
making of any Revolving Credit Loans). Subject to Section 2.3, the Loans shall
be made at such times as the Borrower shall request.
(b) Subject to the terms and conditions hereof, the
Borrower may borrow, repay and re-borrow amounts constituting the Revolving
Credit Commitments.
(c) No Revolving Credit Loan shall be made which would
result in the sum of the aggregate amount of all outstanding Revolving Credit
Loans, plus the then current L/C exposure exceeding the total Revolving Credit
Commitment then in effect (after giving effect to all Revolving Credit Loans
repaid and all reimbursements of Letters of Credit made concurrently with the
making of any Revolving Credit Loans).
SECTION 2.2. Term Loans.
(a) Each Lender, severally and not jointly, agrees, upon
the terms and subject to the conditions hereof, to make loans (the "Term
Loans") to the Borrower on the Closing Date in a total principal amount not
exceeding the amount of such ▇▇▇▇▇▇'s Term Loan Commitment. The aggregate
amount of the Term Loans shall not exceed the lesser of (i) the Borrowing Base
and (ii) the aggregate amount of the Term Loan Commitment then in effect.
(b) Once repaid, amounts constituting the Term Loan
Commitment may not be reborrowed.
SECTION 2.3. Making of Loans.
(a) Each Loan shall be either an Alternate Base Rate Loan
or Eurodollar Loan (each such type of Loan, an "Interest Rate Type") as the
Borrower may request; provided that no more than an aggregate of twenty
separate Eurodollar Loans would be outstanding with respect to any Lender (for
purposes of determining the number of such Loans outstanding, Loans with
Interest Periods commencing or ending on different dates shall be counted as
different Loans). Subject to Section 2.13(d), each Lender may at its option
fulfill its Commitment with respect to
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any Eurodollar Loans by causing a foreign branch or affiliate to make such
Loan, provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms hereof and of
the relevant Note. Subject to the other provisions of this Section, Section
2.9(b) and Section 2.14, Loans of more than one Interest Rate Type may be
outstanding at the same time.
(b) The Borrower hereby requests the Lenders to make the
Term Loan, upon satisfaction of all the condition hereof, in the principal
amount set forth on the initial Borrowing Certificate.
(c) The Borrower shall give the Agent prior written,
telecopier or telephonic (promptly confirmed in writing) notice of each
Borrowing consisting of a Revolving Credit Loan hereunder; such notice shall be
irrevocable and to be effective, must be received by the Agent not later than
12:30 p.m., New York City time, (i) in the case of Alternate Base Rate Loans,
on the Business Day preceding the date on which such Loan is to be made and
(ii) in the case of Eurodollar Loans, on the fourth Business Day preceding the
date on which such Loan is to be made. Such notice shall specify (A) the
amount of the proposed borrowing, (B) the date thereof (which shall be a
Business Day) and (C) whether the Loan then being requested is to be (or what
portion or portions thereof are to be) an Alternate Base Rate Loan or a
Eurodollar Loan and the Interest Period or Interest Periods with respect
thereto in the case of Eurodollar Loans. In the case of a Eurodollar Loan, if
no election of an Interest Period is specified in such notice, such notice
shall be deemed a request for an Interest Period of one month. If no election
is made as to the Interest Rate Type of any Loan, such notice shall be deemed a
request for an Alternate Base Rate Loan. The Lenders shall not be required to
make Loans hereunder more often than three times each calendar week.
(d) Each Loan requested hereunder on any date shall be
made by each Lender in accordance with its respective Percentage.
(e) The Agent shall promptly notify each Lender of its
proportionate share of each Borrowing, the date of such Borrowing, the type or
types of Loans being requested and the Interest Periods applicable thereto. On
the Borrowing date
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specified in such notice, each Lender shall make its share of the Borrowing
available at the office of Chemical Bank, Agent Bank Services Department, ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇
▇. ▇▇▇▇▇▇, for credit to the Chemical Clearing Account and in each case no
later than 12:00 noon New York City time in Federal or other immediately
available funds. Upon receipt of the funds to be made available by the Lenders
to fund any Borrowing hereunder, the Agent shall disburse such funds by
depositing them into an account of the Borrower maintained by the Agent.
(f) The aggregate amount of any Borrowing consisting of
Eurodollar Loans shall be in a minimum aggregate principal amount of $1,000,000
or such greater amount which is an integral multiple of $100,000, and the
aggregate amount of any Borrowing consisting of Alternate Base Rate Loans shall
be in a minimum aggregate principal amount of $500,000 or such greater amount
which is an integral multiple of $100,000 (or such lesser amount as shall equal
(i) the available but unused portion of the aggregate Commitments, then in
effect or (ii) the amount of any Borrowing to fund drawings under Letters of
Credit).
SECTION 2.4. Letters of Credit.
(a) (i) Upon the terms and subject to the conditions hereof,
the Issuing Bank agrees to issue Letters of Credit payable in Dollars from time
to time after the Closing Date and prior to the Revolving Credit Commitment
Termination Date upon the request of the Borrower, provided that (A) the
Borrower shall not request that any Letter of Credit be issued if, after giving
effect thereto, the sum of the then current L/C Exposure plus the aggregate
Revolving Credit Loans then outstanding would exceed the Revolving Credit
Commitment, (B) the Borrower shall not request that any Letter of Credit be
issued if, after giving effect thereto, the L/C Exposure would exceed
$10,000,000, and (C) in no event shall the Issuing Bank issue (x) any Letter of
Credit having an expiration date later than the tenth day prior to the
Revolving Credit Commitment Termination Date or (y) any Letter of Credit having
an expiration date more than two years after its date of issuance.
(ii) Immediately upon the issuance of each Letter of
Credit, each Lender shall be deemed to, and hereby agrees to,
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have irrevocably purchased from the Issuing Bank a participation in such Letter
of Credit in accordance with such ▇▇▇▇▇▇'s Percentage of the Revolving Credit
Commitments.
(iii) Each Letter of Credit may, at the option of the
Issuing Bank, provide that the Issuing Bank may (but shall not be required to)
pay all or any part of the maximum amount which may at any time be available
for drawing thereunder to the beneficiary thereof upon the occurrence of a
Revolving Loan Event of Default and the acceleration of the maturity of the
Loans, provided that, if payment is not then due to the beneficiary, the
Issuing Bank shall deposit the funds in question in an account with the Issuing
Bank to secure payment to the beneficiary and any funds so deposited shall be
paid to the beneficiary of the Letter of Credit if conditions to such payment
are satisfied or returned to the Issuing Bank for distribution to the Lenders
(or, if all Obligations shall have been paid in full in cash, paid over to the
Borrower) if no payment to the beneficiary has been made and the final date
available for drawings under the Letter of Credit has passed. Each payment or
deposit of funds by the Issuing Bank as provided in this paragraph shall be
treated for all purposes of this Agreement as a drawing duly honored by such
Issuing Bank under the related Letter of Credit.
(b) Whenever the Borrower desires the issuance of a
Letter of Credit, it shall deliver to the Agent a written notice no later than
1:00 p.m. New York time at least five Business Days prior to the proposed date
of issuance. That notice shall specify (i) the proposed date of issuance
(which shall be a Business Day under the laws of the jurisdiction of the
Issuing Bank), (ii) the face amount of the Letter of Credit, (iii) the
expiration date of the Letter of Credit, and (iv) the name and address of the
beneficiary. Such notice shall be accompanied by a brief description of the
underlying transaction and upon request of the Issuing Bank, the Borrower shall
provide additional details regarding the underlying transaction. Concurrently
with the giving of written notice of a request for the issuance of a Letter of
Credit, the Borrower shall provide a precise description of the documents and
the verbatim text of any certificate to be presented by the beneficiary of such
Letter of Credit which, if presented by such beneficiary prior to the
expiration date of the Letter of Credit, would require the Issuing Bank to make
payment under the Letter of Credit; provided
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that the Issuing Bank, in its reasonable discretion, may require changes in any
such documents and certificates. Upon issuance, the Issuing Bank shall notify
the Agent of the issuance of such Letter of Credit. Promptly after receipt of
such notice, the Agent shall notify each Lender of the issuance and the amount
of each such ▇▇▇▇▇▇'s respective participation therein.
(c) The acceptance or payment of drafts under any Letter
of Credit shall be made in accordance with the terms of such Letter of Credit
and, in that connection, the Issuing Bank shall be entitled to honor any drafts
and accept any documents presented to it by the beneficiary of such Letter of
Credit in accordance with the terms of such Letter of Credit and believed by
the Issuing Bank in good faith to be genuine. The Issuing Bank shall not have
any duty to inquire as to the accuracy or authenticity of any draft or other
drawing documents which may be presented to it, but shall be responsible only
to determine in accordance with customary commercial practices that the
documents which are required to be presented before payment or acceptance of a
draft under any Letter of Credit have been delivered and that they comply on
their face with the requirements of that Letter of Credit.
(d) If the Issuing Bank shall make payment on any draft
presented under a Letter of Credit, the Issuing Bank shall give notice of such
payment to the Agent and the Lenders and each Lender hereby authorizes and
requests the Issuing Bank to advance for its account pursuant to the terms
hereof its share of such payment based upon its participation in the Letter of
Credit and agrees promptly to reimburse the Issuing Bank in immediately
available funds for the Dollar equivalent of the amount so advanced on its
behalf. If such reimbursement is not made by any Lender in immediately
available funds on the same day on which the Issuing Bank shall have made
payment on any such draft, such Lender shall pay interest thereon to the
Issuing Bank at a rate per annum equal to the Issuing Bank's cost of obtaining
overnight funds in the New York Federal Funds Market.
(e) If any draft is presented under a Letter of Credit,
the payment of which is required to be made at any time on or before the
Revolving Credit Commitment Termination Date, then a payment by the Issuing
Bank on such draft shall constitute an Alternate Base Rate Loan, and interest
shall accrue from the
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date the Issuing Bank makes payment on such draft under such Letter of Credit.
If any draft is presented under a Letter of Credit, the payment of which is
required to be made after the Revolving Credit Commitment Termination Date or
at the time when a Revolving Loan Event of Default or Default under Section 7.2
shall have occurred and then be continuing, then the Borrower shall upon demand
by the Issuing Bank immediately pay to the Issuing Bank, in immediately
available funds, the full amount of such draft together with interest thereon
at the rate per annum of 2% in excess of the Alternate Base Rate from the date
on which the Issuing Bank makes such payment of such draft until the date it
receives full reimbursement for such payment from the Borrower. The Borrower
further agrees that the Issuing Bank may reimburse itself for such drawing from
the balance in the Concentration Account or from the balance in any other
account of the Borrower maintained with the Issuing Bank.
(f) (i) The Borrower agrees to pay the following amount to
the Issuing Bank with respect to Letters of Credit issued by it hereunder:
(A) with respect to the issuance, amendment or
transfer of each Letter of Credit and each drawing made
thereunder, documentary and processing charges in accordance
with such Issuing Bank's standard schedule for such charges in
effect at the time of such issuance, amendment, transfer or
drawing, as the case may be; and
(B) a fronting fee, computed at a rate equal to
1/4 of 1% per annum of the daily average face amount of each
outstanding Letter of Credit issued by the Issuing Bank, such
fee to be due and payable quarterly in arrears on and through
the last Business Day of each September, December, March and
June (commencing the last business day of December 1995) prior
to the Revolving Credit Commitment Termination Date, on the
Revolving Credit Commitment Termination Date and on the
expiration of the last outstanding Letter of Credit.
(ii) The Borrower agrees to pay to the Agent for
distribution to each Lender in respect of all Letters of Credit outstanding
such ▇▇▇▇▇▇'s Pro Rata Share of a commission equal to
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1-1/2% per annum (calculated in the same manner as interest) of the maximum
amount available from time to time to be drawn under such outstanding Letters
of Credit, payable quarterly in arrears on and through the last Business Day of
each September, December, March and June (commencing the last business day of
December 1995) prior to the Revolving Credit Commitment Termination Date, and
on the later of the Revolving Credit Commitment Termination Date and the
expiration of the last outstanding Letter of Credit; and
(iii) Promptly upon receipt by the Issuing Bank or the
Agent of any amount described in clause (ii) of this Section 2.4(f), or any
amount described in Section 2.4(e) previously reimbursed to the Issuing Bank by
the Lenders, the Issuing Bank or Agent shall distribute to each Lender its Pro
Rata Share of such amount. Amounts payable under clauses (i)(A) and (i)(B) of
this Section 2.4(f) shall be paid directly to the Issuing Bank and shall be for
its exclusive use.
(g) If by reason of (i) any change after the date hereof
in Applicable Law, or in the interpretation or administration thereof
(including, without limitation, any request, guideline or policy not having the
force of law) by any Governmental Authority charged with the administration or
interpretation thereof, or (ii) compliance by the Issuing Bank or any Lender
with any direction, request or requirement (whether or not having the force of
law) issued after the date hereof by any Governmental Authority or monetary
authority (including any change whether or not proposed or published prior to
the date hereof), including, without limitation, Regulation D:
(A) the Issuing Bank or any Lender shall be
subject to any tax, levy, charge or withholding of any nature
(other than withholding tax imposed by the United States of
America or political subdivision or taxing authority thereof
or therein or any other tax, levy, charge or withholding (i)
that is measured with respect to the overall net income of the
Issuing Bank or such Lender (or is imposed in lieu of a tax on
net income) or of a Lending Office of the Issuing Bank or such
Lender, and that is imposed by the United States of America,
or by the jurisdiction in which the Issuing Bank or such
Lender is incorporated, or in which such
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Lending Office is located, managed or controlled or in which
the Issuing Bank or such Lender has its principal office (or
any political subdivision or taxing authority thereof or
therein) or (ii) that is imposed solely by reason of the
Issuing Bank or such Lender failing to make a declaration of,
or otherwise to establish, nonresidence, or to make any other
claim for exemption, or otherwise to comply with any
certification, identification, information, documentation or
reporting requirements prescribed under the laws of the
relevant jurisdiction, in those cases where the Issuing Bank
or such Lender may properly make the declaration or claim or
so establish nonresidence or otherwise comply) or to any
variation thereof or to any penalty with respect to the
maintenance or fulfillment of its obligations under this
Section 2.4, whether directly or by such being imposed on or
suffered by the Issuing Bank or any Lender;
(B) any reserve, deposit or similar requirement is or
shall be applicable, imposed or modified in respect of any Letter of Credit
issued by the Issuing Bank or participations therein purchased by any Lender;
or
there shall be imposed on the Issuing Bank or any Lender any other condition
regarding this Section 2.4, any Letter of Credit issued pursuant to this
Section 2.4 or any participation therein;
and the result of the foregoing is to directly or indirectly increase the cost
to the Issuing Bank or any Lender of issuing, making or maintaining any Letter
of Credit or of purchasing or maintaining any participation therein, or to
reduce the amount receivable in respect thereof by the Issuing Bank or any
Lender, then and in any such case the Issuing Bank or such Lender may, at any
time, notify the Borrower, and the Borrower shall pay on demand such amounts as
the Issuing Bank or such Lender may specify to be necessary to compensate the
Issuing Bank or such Lender for such additional cost or reduced receipt. The
determination by the Issuing Bank or any Lender, as the case may be, of any
amount due pursuant to this Section 2.4 as set forth in a certificate setting
forth the calculation thereof in
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reasonable detail shall, in the absence of manifest error, be final, conclusive
and binding on all of the parties hereto.
(h) If at any time when a Revolving Loan Event of Default
shall have occurred and be continuing, any Letters of Credit shall remain
outstanding, then the Agent may, and if directed by the Required Lenders shall,
require the Borrower to deliver to the Issuing Bank Cash Equivalents in an
amount equal to the full amount of the L/C Exposure or to furnish other
security acceptable to the Agent and the Issuing Bank. Any amounts so
delivered pursuant to the preceding sentence shall be applied to reimburse the
Issuing Bank for the amount of any drawings honored under Letters of Credit;
provided, however, that if prior to the Revolving Credit Commitment Termination
Date, (i) no Revolving Loan Event of Default is then continuing, the Issuing
Bank shall return all of such collateral relating to such deposit to the
Borrower if requested by them or (ii) Letters of Credit shall expire or be
returned by the beneficiary so that the amount of the Cash Equivalents
delivered to the Issuing Bank hereunder shall exceed the L/C Exposure, then
such excess shall first be applied to pay any Obligations then due under this
Agreement and the remainder shall be returned to the Borrower.
(i) Notwithstanding the termination of the Commitments
and the payment of the Loans, the obligations of the Borrower under this
Section 2.4 shall remain in full force and effect until the Agent, the Issuing
Bank and the Lenders shall have been irrevocably released from their
obligations with regard to any and all Letters of Credit.
(j) This Section 2.4 shall not be amended without the
written consent of the Issuing Bank and the Agent.
SECTION 2.5. Notes; Repayment.
(a) The Revolving Credit Loans made by each Lender
hereunder shall be evidenced by a Revolving Credit promissory note
substantially in the form of Exhibit A-1 (each a "Revolving Credit Note") in
the face amount of such ▇▇▇▇▇▇'s Revolving Credit Commitment, payable to the
order of such ▇▇▇▇▇▇, duly executed on behalf of the Borrower and dated the
date hereof. The outstanding principal balance of each Revolving Credit Loan
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as evidenced by a Revolving Credit Note shall be payable on the Revolving
Credit Commitment Termination Date.
(b) The Term Loans made by each Lender hereunder shall be
evidenced by a promissory note substantially in the form of Exhibit A-2 (each a
"Term Note") in the face amount of such ▇▇▇▇▇▇'s Term Loan Commitment, payable
to the order of such ▇▇▇▇▇▇, duly executed on behalf of the Borrower and dated
the date hereof. The principal amount of the Term Loans as evidenced by the
Term Notes shall be payable in twenty (20) equal quarterly installments payable
on the last Business Day of each March, June, September and December commencing
March 1996 with the balance of the Term Loans payable in full on December 31,
2000.
(c) Each of the Notes shall bear interest on the
outstanding principal balance thereof as set forth in Section 2.6 hereof. Each
Lender and the Agent on its behalf is hereby authorized by the Borrower, but
not obligated, to enter the amount of each Loan and the amount of each payment
or prepayment of principal or interest thereon in the appropriate spaces on the
reverse of or on an attachment to the appropriate Note; provided, however, that
the failure of any Lender or the Agent to set forth such Loans, principal
payments or other information, or any error with respect thereto, shall not in
any manner affect the obligation of the Borrower to repay the Loans.
SECTION 2.6. Interest on Loans.
(a) In the case of a Eurodollar Loan, interest shall be
payable at a rate per annum (computed on the basis of the actual number of days
elapsed over a year of 360 days) equal to the LIBO Rate plus the Applicable
Margin. Interest shall be payable in arrears on each Eurodollar Loan on each
applicable Interest Payment Date, at maturity and on the date of a conversion
of such Eurodollar Loan to an Alternate Base Rate Loan. The Agent shall
determine the applicable LIBO Rate for each Interest Period as soon as
practicable on the date when such determination is to be made in respect of
such Interest Period and shall notify the Borrower and the Lenders of the
applicable interest rate so determined. Such determination shall be conclusive
absent manifest error.
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(b) In the case of an Alternate Base Rate Loan, interest
shall be payable at a rate per annum (computed on the basis of the actual
number of days elapsed over a year of 360 days) equal to the Alternate Base
Rate plus the Applicable Margin. Interest shall be payable in arrears on each
Alternate Base Rate Loan on each applicable Interest Payment Date, on the
Revolving Credit Commitment Termination Date and at maturity.
(c) Anything in this Agreement or the Notes to the
contrary notwithstanding, the interest rate on the Loans or with respect to any
drawing under a Letter of Credit shall in no event be in excess of the maximum
rate permitted by Applicable Law.
(d) Interest in respect of any Loan hereunder shall
accrue from and including the date of such Loan to but excluding the date on
which such Loan is paid or, if applicable, converted to a Loan of a different
Interest Rate Type.
SECTION 2.7. Commitment Fees and Other Fees.
(a) The Borrower agrees to pay to the Agent quarterly in
arrears for the account of each Lender in accordance with its Percentage, on
the last Business Day of each March, June, September and December in each year
(commencing December 1995) prior to the Revolving Credit Commitment Termination
Date, and on the Revolving Credit Commitment Termination Date, an aggregate fee
(the "Commitment Fee") of 1/2 of 1% per annum on the average daily amount by
which such ▇▇▇▇▇▇'s Revolving Credit Commitment exceeds the sum of the
principal balance of such ▇▇▇▇▇▇'s Revolving Credit Loans outstanding plus such
▇▇▇▇▇▇'s Pro Rata Share of the L/C Exposure during the period then ended,
computed on the basis of the actual number of days elapsed over a year of 360
days. Such Commitment Fees shall commence to accrue on the Closing Date and
shall cease to accrue on December 31, 2000.
(b) In addition, the Borrower agrees to pay to the Agent,
on the date this Agreement is executed by all the parties hereto, any and all
fees that are then due and payable pursuant to the Fee Letter.
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SECTION 2.8. Optional and Mandatory Termination or Reduction
of Commitments.
(a) Upon at least three Business Days' prior written,
telegraphic or telephonic notice (provided that such telephonic notice is
immediately followed by written confirmation) to the Agent, the Borrower may at
any time in whole permanently terminate, or from time to time in part
permanently reduce, the aggregate Revolving Credit Commitment. In the case of
a partial reduction, each such reduction of the Revolving Credit Commitment
shall be in a minimum aggregate principal amount of $2,500,000 or an integral
multiple thereof; provided, however, that the aggregate Revolving Credit
Commitment may not be reduced by more than the amount of the then unused
Revolving Credit Commitment and may not be reduced to an amount less than the
aggregate principal amount of the Revolving Credit Loans outstanding plus the
then current L/C Exposure. Any partial reduction of the Revolving Credit
Commitment shall be made among the Lenders in accordance with their respective
Percentages.
(b) Simultaneously with each such termination or
reduction of the Revolving Credit Commitment, the Borrower shall pay to the
Agent for the benefit of each Lender all accrued and unpaid Commitment Fees on
the amount of the Revolving Credit Commitment so terminated or reduced through
the date of such termination or reduction.
(c) Any reduction of the Revolving Credit Commitment
pursuant to this Section shall be applied to reduce the Revolving Credit
Commitment of each Lender in accordance with its respective Percentage.
SECTION 2.9. Default Interest; Alternate Rate of Interest.
(a) If the Borrower shall default in the payment of the
principal of, or interest on any Loan or any other amount becoming due
hereunder, whether at stated maturity, by acceleration or otherwise, the
Borrower shall on demand from time to time pay interest, to the extent
permitted by Applicable Law on all Loans and overdue amounts outstanding up to
the date of actual payment of such defaulted amount (after as well as before
judgment) at the following rates per annum: (i) for the
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remainder of the then current Interest Period for each Eurodollar Loan, the
rate applicable to such Loan plus 2% per annum and (ii) in the case of any
other amount, the rate that would be applicable to an Alternate Base Rate Loan
plus 2% per annum.
(b) In the event, and on each occasion, that on the day
two Business Days prior to the commencement of any Interest Period for a
Eurodollar Loan, (i) the Agent shall have received notice from any Lender of
such ▇▇▇▇▇▇'s determination (which determination, absent manifest error, shall
be conclusive) that Dollar deposits in the amount of the principal amount of
such Eurodollar Loan are not generally available in the London Interbank
Market, or (ii) the Agent shall have determined that reasonable means do not
exist for ascertaining the applicable LIBO Rate, the Agent shall, as soon as
practicable thereafter, give written or telegraphic notice of such
determination to the Borrower and the Lenders, such request and any further
request by the Borrower for a Eurodollar Loan (or conversion to or continuation
as a Eurodollar Loan pursuant to Section 2.11), made after receipt of such
notice, shall be deemed a request for an Alternate Base Rate Loan; provided,
however, that in the circumstances described in clause (i) above such deemed
request shall only apply to the affected ▇▇▇▇▇▇'s portion thereof. After such
notice shall have been given and until the circumstances giving rise to such
notice no longer exist, each request (or portion thereof, as the case may be)
for a Eurodollar Loan, to the extent such request relates to such affected
Lender's portion, shall be deemed to be a request for an Alternate Base Rate
Loan.
SECTION 2.10. Interest Adjustments.
If the provisions of this Agreement or the Notes would at any
time require payment by the Borrower to any Lender of any amount of interest in
excess of the maximum amount then permitted by the law applicable to the Loans,
the interest payments to such Lender shall be reduced to the extent and in such
a manner as is necessary in order that the Lenders not receive interest in
excess of such maximum amount. To the extent that, pursuant to the foregoing
sentence, the Lenders shall receive interest payments hereunder or under the
Notes in an amount less than the amount otherwise provided hereunder, such
deficit (hereinafter called the "Interest Deficit") will cumulate and will be
carried
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forward (without interest) until the termination of this Agreement. Interest
otherwise payable to the Lenders hereunder and under the Notes for any
subsequent period shall be increased by the maximum amount of the Interest
Deficit that may be so added without causing the Lenders to receive interest in
excess of the maximum amount then permitted by the law applicable to the Loans.
The amount of the Interest Deficit relating to the Loans and the Notes shall be
treated as a prepayment penalty and paid in full at the time of any optional
prepayment by the Borrower to the Lenders of all the Loans at the time
outstanding pursuant to Section 2.12(a) hereof. The amount of the Interest
Deficit relating to the Loans and the Notes at the time of any complete payment
of the Loans at that time outstanding (other than an optional prepayment
thereof pursuant to Section 2.12(a)) shall be cancelled and not paid.
SECTION 2.11. Continuation and Conversion of Loans.
The Borrower shall have the right, at any time, to convert any
Loan or portion thereof to a Loan of a different Interest Rate Type or to
continue a Eurodollar Loan for a successive Interest Period, subject to the
following:
(a) the Borrower shall give the Agent prior notice of
each continuation or conversion hereunder of at least four Business Days; such
notice shall be irrevocable and to be effective, must be received by the Agent
not later than 12:30 p.m. New York City time;
(b) no Event of Default or Default shall have occurred
and be continuing at the time of any conversion to a Eurodollar Loan or
continuation of any such Loan into a subsequent Interest Period;
(c) no Loan (or portion thereof) may be converted to a
Eurodollar Loan if, after such conversion, and after giving effect to any
concurrent prepayment of Loans, an aggregate of more than twenty separate
Eurodollar Loans would be outstanding with respect to any Lender (for purposes
of determining the number of such Loans outstanding, Loans with Interest
Periods commencing or ending on different dates shall be counted as different
Loans even if made on the same date);
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(d) if fewer than all Loans at the time outstanding shall
be continued or converted, such continuation or conversion shall be made pro
rata among the Lenders in accordance with the respective Percentage of the
principal amount of such Loans held by the Lenders immediately prior to such
continuation or conversion;
(e) the aggregate principal amount of Loans continued as,
or converted to, Eurodollar Loans as part of the same continuation or
conversion, shall not be less than $1,000,000 or such greater amount which is
an integral multiple of $100,000;
(f) the Interest Period with respect to a new Eurodollar
Loan effected by a continuation or conversion shall commence on the date of
such continuation or conversion;
(g) if a Eurodollar Loan is converted to an Alternate
Base Rate Loan other than on the last day of the Interest Period with respect
thereto, the amounts required by Section 2.12 shall be paid upon such
conversion;
(h) each request for a continuation as or conversion to a
Eurodollar Loan which fails to state an applicable Interest Period shall be
deemed to be a request for an Interest Period of one month; and
(i) accrued interest on a Eurodollar Loan (or portion
thereof) being converted to an Alternate Base Rate Loan shall be paid by the
Borrower at the time of conversion.
In the event that the Borrower shall not give notice to
continue or convert any Eurodollar Loan as provided above, such Loan (unless
repaid) shall automatically be continued as a Eurodollar Loan with an Interest
Period of one month at the expiration of the then current Interest Period. The
Agent shall, after it receives notice from the Borrower, promptly give the
Lenders notice of any continuation or conversion. It is understood by all
parties to this Agreement that the continuation or conversion of any Loan
pursuant to this Section 2.11 does not constitute a repayment and a reborrowing
hereunder and is not subject to the conditions set forth in Section 4.2 and
that the designation of a Loan as an Alternate Base Rate Loan or Eurodollar
Loan, and the designation of applicable Interest
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Periods, is solely a mechanism for determining the interest rate applicable to
such Loan.
SECTION 2.12. Prepayment of Loans; Reimbursement of Lenders.
(a) Subject to the terms of paragraph (b) of this Section
2.12, the Borrower shall have the right at any time and from time to time to
prepay any (i) Alternate Base Rate Loan, in whole or in part, upon at least one
Business Day's prior written, telephonic (provided that such telephonic notice
is immediately followed by written confirmation) or telegraphic notice to the
Agent in the minimum principal amount of $500,000 or such greater amount which
is an integral multiple of $100,000 and (ii) any Eurodollar Loan, in whole or
in part, upon at least four Business Days' written notice to the Agent, in the
principal amount of $1,000,000 or such greater amount which is an integral
multiple of $100,000. Each notice of prepayment shall specify the prepayment
date, the principal amount to be prepaid and the Loans to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay each such Loan in the
amount and on the date stated therein. All prepayments under this Section
2.12(a) shall be accompanied by accrued but unpaid interest on the principal
amount being prepaid to the date of (but not including) prepayment. All
prepayments under this Section 2.12 with regard to the Term Loan shall be
applied against the remaining scheduled amortization payments in order of
maturity.
(b) The Borrower shall reimburse each Lender on demand
for any loss incurred or to be incurred by it in the reemployment of the funds
released (i) by any prepayment or conversion (for any reason whatsoever) of a
Eurodollar Loan required or permitted under this Agreement, if such Loan is
prepaid or converted other than on the last day of the Interest Period for such
Loan, or (ii) in the event that after the Borrower delivers a notice of
Borrowing under Section 2.3(c) or notice of continuation or conversion in
respect of Eurodollar Loans, such Loan is not made on the first day of the
Interest Period specified in such notice of Borrowing for any reason other than
(A) a suspension or limitation under Section 2.9(b) of the right of the
Borrower to select a Eurodollar Loan or (B) a breach by the Lenders of their
obligations hereunder. Such loss shall be the amount as reasonably determined
by such Lender as the excess, if any, of
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(I) the amount of interest which would have accrued to such Lender on the
amount so paid or not borrowed, continued or converted at a rate of interest
equal to the interest rate applicable to such Loan pursuant to Section 2.6
hereof for the period from the date of such payment or failure to borrow,
continue or convert to the last day (x) in the case of a payment other than on
the last day of the Interest Period for such Loan, of the then current Interest
Period for such Loan, or (y) in the case of such failure to borrow, continue or
convert, of the Interest Period for such Loan which would have commenced on the
date of such failure to borrow, continue or convert, over (II) the amount
realized by such ▇▇▇▇▇▇ in reemploying the funds not advanced or the funds
received in prepayment or realized from the Loan so continued or converted
during the period referred to above. Each Lender shall deliver to the Borrower
from time to time one or more certificates setting forth the amount of such
loss (and in reasonable detail the manner of computation thereof) as determined
by such Lender, which certificates shall be conclusive absent manifest error.
(c) In the event the Borrower fails to prepay any Loan on
the date specified in any prepayment notice delivered pursuant to Section
2.12(a), the Borrower on demand by any Lender shall pay to the Agent for the
account of such Lender any amounts required to compensate such Lender for any
actual loss reasonably incurred by such Lender as a result of such failure to
prepay, including, without limitation, any actual loss, cost or expenses
incurred by reason of the acquisition of deposits or other funds by such Lender
to fulfill deposit obligations incurred in anticipation of such prepayment.
Each Lender shall deliver to the Borrower and the Agent promptly after such
prepayment one or more certificates setting forth the amount of such loss (and
in reasonable detail the manner of computation thereof) as determined by such
Lender, which certificates shall be conclusive absent manifest error.
(d) Within five (5) days after the delivery to the Agent
of each Borrowing Base Certificate, the Borrower shall prepay the Term Loans to
the extent, if any, that the sum of the Term Loans outstanding exceeds the
Borrowing Base as set forth on such Borrowing Base Certificate.
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(e) If upon the delivery to the Agent of each Borrowing
Base Certificate the Borrowing Base Ratio is less than 0.85:1, the Term Loan
shall be repaid on the last Business Day of each week by an amount equal to the
balance in the Concentration Account so long as such balance exceeds $150,000.
(f) Simultaneously with each termination and/or optional
reduction of the Revolving Credit Commitment pursuant to Section 2.8, the
Borrower shall pay to the Agent for the benefit of the Lenders the excess of
the aggregate outstanding principal amount of the Revolving Credit Loans over
the reduced Revolving Credit Commitment, all accrued and unpaid interest
thereon and the Commitment Fees on the amount of the Revolving Credit
Commitment so terminated or reduced through the date thereof.
(g) If at any time the amount of the Revolving Credit
Loans outstanding plus the L/C Exposure shall ever exceed the Revolving Credit
Commitment hereunder, the Borrower will immediately prepay Revolving Credit
Loans to the extent the outstanding Revolving Credit Loans plus the L/C
Exposure exceed the Revolving Credit Commitment.
(h) An amount equal to 100% of the net cash proceeds of
all issuances by the Borrower of any additional debt or equity securities to
any Person that is not an Affiliate of the Borrower shall be applied to prepay
the Term Loan, and subsequent to the repayment in full of the Term Loan, shall
be applied to repay the Revolving Credit Loans with a corresponding reduction
in the Revolving Credit Commitment.
(i) At the option of the Borrower, all prepayments under
this Section shall be applied to repay Alternate Base Rate Loans or Eurodollar
Loans in such order as the Borrower requests. In the event that the Borrower
shall not give notice as to how such prepayments are to be applied, such
prepayment will be applied, first, to prepay Alternate Base Rate Loans and,
second, to prepay Eurodollar Loans in order of maturity of the scheduled
termination of Interest Periods with respect thereto.
(j) If on any day on which Loans would otherwise be
required to be prepaid under this Section but for the operation of this Section
2.12(j) (each a "Prepayment Date"), the amount of such required prepayment
exceeds the then outstanding aggregate
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principal amount of Loans which consist of Alternate Base Rate Loans, and no
Default or Event of Default is then continuing, then on such Prepayment Date
the Borrower may, at its option, deposit Dollars into the Cash Collateral
Account in an amount equal to such excess. If the Borrower makes such deposit
(i) only the outstanding Alternate Base Rate Loans shall be required to be
prepaid on such Prepayment Date, and (ii) on the last day of each Interest
Period in effect after such Prepayment Date the Agent is irrevocably authorized
and directed to apply funds from the Cash Collateral Account (and liquidate
investments held in the Cash Collateral Account as necessary) to prepay
Eurodollar Loans for which the Interest Period is then ending until the
aggregate of such prepayments equals the prepayment which would have been
required on such Prepayment Date but for the operation of this Section 2.12(j).
SECTION 2.13. Change in Circumstances.
(a) In the event that after the date hereof any change in
Applicable Law or in the interpretation or administration thereof (including,
without limitation, any request, guideline or policy not having the force of
law) by any Governmental Authority charged with the administration or
interpretation thereof or, with respect to clause (ii), (iii) or (iv) below any
change in conditions, shall occur which shall:
(i) subject any Lender to, or increase the net
amount of, any tax, levy, impost, duty, charge, fee, deduction
or withholding with respect to any Eurodollar Loan (other than
withholding tax imposed by the United States of America or any
political subdivision or taxing authority thereof or therein
or any other tax, levy, impost, duty, charge, fee, deduction
or withholding (x) that is measured with respect to the
overall net income of such Lender (or is imposed in lieu of a
tax on net income) or of a Lending Office of such Lender, and
that is imposed by the United States of America, or by the
jurisdiction in which such Lender or Lending Office is
incorporated, in which such Lending Office is located, managed
or controlled or in which such Lender has its principal office
(or any political subdivision or taxing authority thereof or
therein)); or, (y) that is imposed solely by reason of
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any Lender failing to make a declaration of, or otherwise to
establish, nonresidence, or to make any other claim for
exemption, or otherwise to comply with any certification,
identification, information, documentation or reporting
requirements prescribed under the laws of the relevant
jurisdiction, in those cases where a Lender may properly make
such declaration or claim or so establish nonresidence or
otherwise comply); or
(ii) change the basis of taxation of any payment
to any Lender of principal of or interest on any Eurodollar
Loan or other fees and amounts payable to any Lender
hereunder, or any combination of the foregoing; other than
taxes imposed on the overall net income of any Lender for any
Eurodollar Loan by any jurisdiction where its Lending Office
is located; or
(iii) impose, modify or deem applicable any
reserve, special deposit or similar requirement against any
assets of, deposits with or for the account of or loans or
commitments by an office of such Lender with respect to any
Eurodollar Loan; or
(iv) impose upon such Lender or the London
Interbank Market any other condition with respect to the
Eurodollar Loans or this Agreement;
and the result of any of the foregoing shall be to, directly or indirectly,
increase the cost to such Lender of making or maintaining any Eurodollar Loan
hereunder or to reduce the amount of any payment (whether of principal,
interest or otherwise) received or receivable by such Lender, or to require
such Lender to make any payment in connection with any Eurodollar Loan, in each
case by or in an amount which such Lender in its sole judgment shall deem
material, then and in each case the Borrower agrees to pay to the Agent for the
account of such ▇▇▇▇▇▇, as provided in paragraph (c) below, such amounts as
shall be necessary (after adjusting, if necessary, to avoid double counting) to
compensate such Lender for such cost, reduction or payment.
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(b) If any Lender shall have determined that the
applicability of any law, rule, regulation or guideline adopted pursuant to or
arising out of the July 1988 report of the Basle Committee on Banking
Regulations and Supervisory Practices entitled "International Convergence of
Capital Measurement and Capital Standards", or the adoption after the date
hereof of any law, rule, regulation or guideline regarding capital adequacy, or
any change after the date hereof in any of the foregoing or in the
interpretation or administration of any of the foregoing by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or any Lender's holding company 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 Lender's capital or on the capital of such
Lender's holding company, if any, as a consequence of this Agreement or the
Loans made or Letters of Credit issued or participated in by such Lender
pursuant hereto to a level below that which such Lender or such Lender's
holding company could have achieved but for such applicability, adoption,
change or compliance (taking into consideration such Lender's policies and the
policies of such Lender's holding company with respect to capital adequacy) by
an amount deemed by such Lender in its sole judgment to be material, then from
time to time the Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such Lender's holding company for any
such reduction suffered to the extent attributable to this Agreement or the
Loans made pursuant hereto.
(c) Each Lender shall deliver to the Borrower and the
Agent, with reasonable promptness, after it becomes aware of an event set forth
in paragraph (a) or (b) above, one or more certificates setting forth the
amounts due to such Lender under paragraphs (a) and (b) above, the changes as a
result of which such amounts are due and the manner of computing such amounts.
Each such certificate shall be conclusive in the absence of manifest error.
The Borrower shall pay to the Agent for the account of each such Lender the
amounts shown as due on any such certificate within ten Business Days after its
receipt of the same. No failure on the part of any Lender to demand
compensation under paragraph (a) or (b) above on any one occasion
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shall constitute a waiver of its rights to demand compensation on any other
occasion. The protection of this Section shall be available to each Lender
regardless of any possible contention of the invalidity or inapplicability of
any law, regulation or other condition which shall give rise to any demand by
such Lender for compensation thereunder.
(d) Each Lender agrees that, with reasonable promptness,
after it becomes aware of the occurrence of an event or the existence of a
condition that (i) would cause it to incur any material increased cost
hereunder or render it unable to perform its agreements hereunder for the
reasons specifically set forth in Section 2.4(g) or Section 2.9(b) or this
Section 2.13 or Section 2.16 or (ii) would require the Borrower to pay an
increased amount under Section 2.4(g), Section 2.9(b), this Section 2.13 or
Section 2.16, it will notify the Borrower as promptly as practicable of such
event or condition and, to the extent not inconsistent with such Lender's
internal policies, will use its reasonable efforts to make, fund or maintain
the affected Eurodollar Loans of such Lender, or, if applicable, to participate
in Letters of Credit as required under Section 2.4, through another Lending
Office of such Lender if as a result thereof the additional monies which would
otherwise be required to be paid or the reduction of amounts receivable by such
Lender in respect of such Loans would be materially reduced, or such inability
to perform would cease to exist, or the increased costs which would otherwise
be required to be paid in respect of such Loans pursuant to Section 2.4(g),
Section 2.9(b), this Section 2.13 or Section 2.16 would be materially reduced
or the taxes or other amounts otherwise payable under Section 2.4(g), Section
2.9(b), this Section 2.13 or Section 2.16 would be materially reduced, and if,
as determined by such Lender, in its discretion, the making, funding or
maintaining of such Loans through such other Lending Office would not otherwise
materially adversely affect such Loans or such Lender.
(e) If the Borrower shall receive notice from any Lender
that Eurodollar Loans are no longer available from such Lender pursuant to
Section 2.14 that amounts are due to such Lender pursuant to paragraph (c)
hereof or that any of the events designated in paragraph (d) hereof have
occurred, the Borrower may (but subject in any such case to the payments
required by Sections 2.12(b) and 2.12(g)), upon at least five Business Days'
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prior written or telecopier notice to such Lender and the Agent, but not more
than 60 days after receipt of notice from such Lender, identify to the Agent a
lending institution acceptable to the Borrower and the Agent, which will
purchase the Commitments, the amount of outstanding Loans, any participations
in Letters of Credit from the Lender providing such notice and such Lender
shall thereupon assign its Commitment, any Loans owing to such Lender, any
participations in Letters of Credit and the Notes held by such Lender to such
replacement lending institution pursuant to Section 13.3.
SECTION 2.14. Change in Legality.
(a) Notwithstanding anything to the contrary contained
elsewhere in this Agreement, if any change after the date hereof in Applicable
Law or guideline, or change in the interpretation thereof by any Governmental
Authority charged with the administration thereof, shall make it unlawful for
any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to a Eurodollar Loan, then, by
written notice to the Borrower and the Agent, such Lender may (i) declare that
Eurodollar Loans will not thereafter be made by such Lender hereunder whereupon
such ▇▇▇▇▇▇'s Percentage of any subsequent Eurodollar Loan shall, instead, be
an Alternate Base Rate Loan unless such declaration is subsequently withdrawn
and/or (ii) require that, subject to Section 2.12(b), all outstanding
Eurodollar Loans made by it be converted to Alternate Base Rate Loans,
whereupon all of such Eurodollar Loans shall automatically be converted to
Alternate Base Rate Loans as of the effective date of such notice as provided
in paragraph (b) below. If the Commitment of any Lender with respect to any
Eurodollar Loan is suspended pursuant to this Section 2.14 and such Lender
shall notify the Agent and the Borrower that it is once again legal for such
Lender to make or maintain Eurodollar Loans, such ▇▇▇▇▇▇'s Commitment to make
or maintain Eurodollar Loans shall be reinstated.
(b) A notice to the Borrower by any Lender pursuant to
paragraph (a) above shall be effective for purposes of clause (ii) thereof, (i)
on the last day of the current Interest Period for each outstanding Eurodollar
Loan if it shall be lawful for such Eurodollar Loans to remain outstanding and
(ii) on the date of receipt of such notice by the Borrower in all other cases.
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SECTION 2.15. Manner of Payments.
All payments of interest and repayments of principal in
respect of any Loans shall be pro rata among the Lenders in accordance with
their Percentage. Payments of Commitment Fees shall be allocated among Lenders
in accordance with Section 2.7. All payments by the Borrower hereunder and
under the Notes shall be made in Dollars in immediately available funds at the
office of Chemical Bank, the Agent Bank Services Department, ▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
for credit to the Chemical Clearing Account in each case by 12:00 noon, New
York City time, on the date on which such payment shall be due.
SECTION 2.16. United States Withholdings.
(a) Prior to the date of the initial Loans hereunder, and
prior to the effective date set forth in the Assignment and Acceptance with
respect to any Lender becoming a Lender after the date hereof, and from time to
time thereafter if requested by the Borrower or the Agent or required because,
as a result of a change in law or a change in circumstances or otherwise, a
previously delivered form or statement becomes incomplete or incorrect in any
material respect, each Lender organized under the laws of a jurisdiction
outside the United States shall provide, if applicable, the Agent and the
Borrower with complete, accurate and duly executed forms or other statements
prescribed by the Internal Revenue Service of the United States certifying such
▇▇▇▇▇▇'s exemption from, or entitlement to a reduced rate of, United States
withholding taxes (including backup withholding taxes) with respect to all
payments to be made to such Lender hereunder and under the Notes.
(b) The Borrower and the Agent shall be entitled to
deduct and withhold any and all present or future taxes or withholdings, and
all liabilities with respect thereto, from payments hereunder or under the
Notes, if and to the extent that the Borrower or the Agent in good faith
determine that such deduction or withholding is required by the law of the
United States, including, without limitation, any applicable treaty of the
United States. In the event the Borrower or the Agent shall so determine that
deduction or withholding of taxes is required,
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they shall advise the affected Lender as to the basis of such determination
prior to actually deducting and withholding such taxes. In the event the
Borrower or the Agent shall so deduct or withhold taxes from amounts payable
hereunder, such party (i) shall pay to or deposit with the appropriate taxing
authority in a timely manner the full amount of taxes it has deducted or
withheld; (ii) shall provide evidence of payment of such taxes to, or the
deposit thereof with, the appropriate taxing authority and a statement setting
forth the amount of taxes deducted or withheld, the applicable rate, and any
other information or documentation reasonably requested by the Lenders from
whom the taxes were deducted or withheld; and (iii) shall forward to such
Lenders any official tax receipts or other documentation with respect to the
payment or deposit of the deducted or withheld taxes as may be issued from time
to time by the appropriate taxing authority. Unless the Borrower and the Agent
have received forms or other documents satisfactory to them indicating that
payments hereunder or under any Note are not subject to United States
withholding tax or are subject to such tax at a rate reduced by an applicable
tax treaty, the Borrower or the Agent may withhold taxes from such payments at
the applicable statutory rate in the case of payments to or for any Lender
organized under the laws of a jurisdiction outside the United States.
(c) Each Lender agrees (i) that as between it and the
Borrower or the Agent, it shall be the Person to deduct and withhold taxes, and
to the extent required by law it shall deduct and withhold taxes, on amounts
that such Lender may remit to any other Person(s) by reason of any undisclosed
transfer or assignment of an interest in this Agreement to such other Person(s)
pursuant to Section 13.3(g); and (ii) to indemnify the Borrower and the Agent
and any officers, directors, agents, or employees of the Borrower or the Agent
against and to hold them harmless from any tax, interest, additions to tax,
penalties, reasonable counsel and accountants' fees and disbursements arising
from the assertion by any appropriate United States taxing authority of any
claim against them relating to a failure to withhold taxes as required by law
with respect to amounts described in clause (i) of this paragraph (c).
(d) Each assignee of a Lender's interest in this
Agreement in conformity with Section 13.3 shall be bound by this
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Section 2.16, so that such assignee will have all of the obligations and
provide all of the forms and statements and all indemnities, representations
and warranties required to be given under this Section 2.16.
(e) Notwithstanding the foregoing, in the event that any
withholding taxes shall become payable solely as a result of any change in any
statute, treaty, ruling, determination or regulation occurring after the
Initial Date in respect of any sum payable hereunder or under any other
Fundamental Document to any Lender or the Agent (i) the sum payable by the
Borrower shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.16) such Lender or the Agent (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall
pay the full amount deducted to the relevant taxation authority or other
authority in accordance with Applicable Law.
(f) In the event that a Lender receives a refund of or
credit for taxes withheld pursuant to clause (e) of this Section, which credit
or refund is identifiable by such ▇▇▇▇▇▇ as being a result of taxes withheld in
connection with sums payable hereunder, such Lender shall promptly notify the
Agent and the Borrower and shall remit to the Borrower the amount of such
refund or credit allocable to payments made hereunder.
SECTION 2.17. Provisions Relating to the Borrowing Base.
In the event the Agent notifies the Borrower that a Person is
to be deleted as an Approved Account Debtor in accordance with the definition
thereof, no additional Eligible Receivables from such Person may be included in
the Borrowing Base subsequent to such notice unless fully secured by an
Acceptable L/C or guaranteed by Metromedia (to the extent such guaranteed
amount does not exceed the aggregate amount permitted for receivables
guaranteed by Metromedia) or the Agent thereafter notifies the Borrower that
such Person is reinstated as an Approved Account Debtor in accordance with the
definition thereof. In the event the Agent notifies the Borrower that the
Allowable Amount with respect to an Approved Account Debtor is to
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be reduced in accordance with the definition of Approved Account Debtor, no
additional Eligible Receivables from such Approved Account Debtor may be
included in the Borrowing Base subsequent to such notice if such inclusion
would result in the aggregate amount of Eligible Receivables from such Approved
Account Debtor being in excess of the Allowable Amount after giving effect to
such reduction unless the Agent thereafter notifies the Borrower that the
Allowable Amount may be increased in accordance with the definition of Approved
Account Debtor or unless any such excess amount is supported by an Acceptable
L/C or guaranteed by Metromedia (to the extent such guaranteed amount does not
exceed the aggregate amount permitted for receivables guaranteed by
Metromedia). Notwithstanding the foregoing, even if a Person is deleted as an
Approved Account Debtor or the Allowable Amount set forth in Schedule 2 hereto
with respect to an Approved Account Debtor has been reduced, an item that was
included as an Eligible Receivable on the most recent Borrowing Base
Certificate received by the Agent prior to any such deletion or reduction, may
continue to be included as an Eligible Receivable in any subsequent Borrowing
Base Certificate.
3. REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Issuing Bank to enter
into this Agreement and to make the Loans and issue, and purchase
participations in the Letters of Credit as provided herein, the Credit Parties,
jointly and severally, hereby make the following representations and warranties
to the Lenders:
SECTION 3.1. Corporate Existence and Power.
Each of the Credit Parties has been duly organized, is validly
existing and in good standing under the laws of its jurisdiction of
incorporation and is in good standing as a foreign corporation in all
jurisdictions where the nature of its properties or business so requires,
including, without limitation, in any jurisdiction in which the failure to be
in good standing would render any Eligible Receivable otherwise unenforceable
or would give rise to a material liability of any Credit Party. Each of the
Credit Parties has the corporate power to own its respective properties and
carry on its businesses as now being conducted, and in the case of each Credit
Party to execute, deliver and perform its obligations under the
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Fundamental Documents and all other documents contemplated hereby to which it
is or will be a party as provided herein, in the case of the Borrower to borrow
and execute and deliver the Notes hereunder, and in the case of each Credit
Party to grant to the Agent for the benefit of the Lenders, a security interest
in the Collateral as contemplated by Article 8 hereof and by the Fundamental
Documents to which it is or will be a party and in the case of each Corporate
Guarantor to guaranty the Obligations as contemplated by Article 9 hereof.
SECTION 3.2. Corporate Authority and No Violation.
(a) The consummation of the Mergers and the execution,
delivery and performance of this Agreement and the other Fundamental Documents
to which it is a party, by each Credit Party, in the case of the Borrower, the
borrowings hereunder and the execution and delivery of the Notes; in the case
of each Credit Party, the grant to the Agent for the benefit of the Lenders of
the security interests contemplated by Article 8 hereof; in the case of each
Corporate Guarantor, the guaranty of the Obligations as contemplated in Article
9 hereof; (i) have been duly authorized by all necessary corporate action on
the part of each such Credit Party, (ii) will not violate any provision of any
Applicable Law applicable to any of the Credit Parties or any of their
respective properties or assets, (iii) will not violate any provision of the
Certificate of Incorporation or By-Laws of any of the Credit Parties, (iv) will
not violate, conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any provision of any
Distribution Agreement, indenture, agreement, bond, note, or other similar
instrument to which any Credit Party is a party or by which any such party or
any of their respective properties or assets are bound, and (v) will not result
in the creation or imposition of any Lien upon any property or assets of any
Credit Party other than as a result of this Agreement and the other Fundamental
Documents to which it is a party, except to the extent, with respect to clauses
(ii), (iv) and (v), as does not and will not have a Material Adverse Effect.
(b) Except as set forth on Schedule 3.2, there are no
restrictions on the transfer of any of the Pledged Securities subject to the
Pledge Agreements other than as a result of this
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Agreement or the Pledge Agreements or applicable securities laws and the
regulations promulgated thereunder.
SECTION 3.3. Governmental Approval.
All authorizations, approvals, registrations or filings with
any governmental or public regulatory body or authority of the United States or
any state thereof (other than UCC financing statements and the Copyright
Security Agreement, which have been delivered to the Agent prior to the making
of the initial Loan hereunder, in form suitable for recording or filing with
the appropriate filing office) required for the execution, delivery and
performance by any Credit Party of this Agreement and the other Fundamental
Documents to which it is a party, and the execution and delivery by the
Borrower of the Notes, have been duly obtained or made, or duly applied for and
are in full force and effect, and if any such further authorizations,
approvals, registrations or filings should hereafter become necessary, the
Credit Parties will use their best efforts to obtain or make all such
authorizations, approvals, registrations or filings.
SECTION 3.4. Financial Condition.
(i) The audited consolidated balance sheet of the
Borrower and its Subsidiaries at the fiscal year ended February 28, 1995 and
(ii) the unaudited consolidated and consolidating balance sheet of the Borrower
and its Subsidiaries at May 31, 1995, together with the related statements of
cash flows and the related notes and supplemental information for the audited
statements, have been prepared in accordance with GAAP in effect as of such
date consistently applied, except as otherwise indicated in the notes to such
financial statements and subject in the case of unaudited statements to changes
resulting from year-end and audit adjustments. All of such financial
statements fairly present the financial position or the results of operations
of the Borrower and its Subsidiaries on a consolidated basis at the dates or
for the periods indicated, subject to year-end and audit adjustments in the
case of unaudited statements, and reflect all known liabilities, contingent or
otherwise, that GAAP require, as of such dates, to be shown or reserved
against.
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SECTION 3.5. No Material Adverse Change.
(a) Since February 28, 1995, except as described in the
SEC Filings, there has been no event or events which have had a Material
Adverse Effect. At the Closing Date, there has not been any material change in
the information contained in the Confidential Information Memorandum dated
October 1995, which change has not been previously disclosed to the Lenders in
writing.
(b) No Credit Party prior to or at or after the date
hereof is entering into the arrangements contemplated hereby and by the other
Fundamental Documents, or intends to make any transfer or incur any obligations
hereunder or thereunder, with actual intent to hinder, delay or defraud either
present or future creditors. On and as of the date hereof, on a pro forma
basis after giving effect to all Indebtedness (including the Loans) (w) each
Credit Party expects the cash available to such Credit Party, after taking into
account all other anticipated uses of the cash of such Credit Party (including
the payments on or in respect of debt referred to in clause (y) of this Section
3.5(b)), will be sufficient to satisfy all final judgments for money damages
which have been docketed against such Credit Party or which may be rendered
against such Credit Party in any action in which such Credit Party is a
defendant (taking into account the reasonably anticipated maximum amount of any
such judgment and the earliest time at which such judgment might be entered);
(x) the sum of the present fair saleable value of the assets of each Credit
Party will exceed the probable liability of such Credit Party on its debts
(including its Guaranties); (y) no Credit Party will have incurred or intends
to, or believes that it will, incur debts beyond its ability to pay such debts
as such debts mature (taking into account the timing and amounts of cash to be
received by such Credit Party from any source, and of amounts to be payable on
or in respect of debts of such Credit Party and the amounts referred to in
clause (w)); and (z) each Credit Party will have sufficient capital with which
to conduct its present and proposed business and the property of such Credit
Party does not constitute unreasonably small capital with which to conduct its
present or proposed business. For purposes of this Section 3.5, "debt" means
any liability on a claim, and "claim" means (i) right to payment whether or not
such right is reduced to judgment, liquidated,
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unliquidated, fixed, contingent, matured, unmatured, disputed (other than those
being disputed in good faith), undisputed, legal, equitable, secured or
unsecured, or (ii) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured.
SECTION 3.6. Title to Properties.
As of the date hereof, each of the Borrower and its
Subsidiaries has title or valid leasehold interests to each of its material
properties and assets reflected on the balance sheets referred to in Section
3.4, and all such properties and assets are free and clear of Liens, except
Permitted Encumbrances.
SECTION 3.7. UCC Filing Information.
The chief executive offices of each Credit Party are on the
date hereof as set forth on Schedule 3.7 hereto, which offices are the places
where each of such Persons are "located" for the purpose of Section 9-103(3)(d)
of the UCC in effect in the State of New York and any State in which any such
Person is so located, and the places in which each such Person keeps the
records concerning the Collateral on the date hereof or regularly keeps any
goods included in the Collateral on the date hereof are also listed on Schedule
3.7 hereto.
SECTION 3.8. Litigation.
Except as set forth in Schedule 3.8 or as disclosed in the SEC
Filings, there are no judgments, orders, lawsuits, actions, suits or other
proceedings pending at law or in equity, or, to the knowledge of the Credit
Parties, threatened, against or affecting the Borrower, its Subsidiaries or any
of their respective properties, by or before any Governmental Authority or
arbitrator, which would reasonably be expected to have a Material Adverse
Effect or which involve this Agreement or any of the lending transactions
contemplated hereby. Except as disclosed on Schedule 3.8, neither the Borrower
nor any of its Subsidiaries is in default with respect to any order, writ,
injunction, decree,
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material rule or material regulation of any Governmental Authority.
SECTION 3.9. Federal Reserve Regulations.
Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin Stock.
No part of the proceeds of the Loans will be used, whether immediately,
incidentally or ultimately, to purchase or carry any Margin Stock, to extend
credit to others for the purpose of purchasing or carrying any Margin Stock or
for any other purpose violative of or inconsistent with any of the provisions
of Regulation G, T, U or X of the Board.
SECTION 3.10. Investment Company Act.
None of the Credit Parties are, or will during the term of
this Agreement be, (x) an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended, or (y) subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act or any foreign, federal or local
statute or regulation limiting its ability to incur indebtedness for money
borrowed or guarantee such indebtedness as contemplated hereby or by any other
Fundamental Document.
SECTION 3.11. Enforceability.
This Agreement and each other Fundamental Document will
constitute legal, valid and enforceable obligations of each Credit Party which
is a party thereto (subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and to general principles of
equity).
SECTION 3.12. Taxes.
The Borrower and each of its Subsidiaries has filed or caused
to be filed all federal, state and local tax returns which are required to be
filed in all jurisdictions which are significant to the business of the Credit
Parties, and have paid
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or have caused to be paid all taxes as shown on said returns or on any
assessment received by them in writing, to the extent that such taxes have
become due, except as permitted by Section 5.5 hereof. No Credit Party knows
of any material additional assessments or any basis therefor. Each Credit
Party reasonably believes that the charges, accruals and reserves on its books
in respect of taxes or other governmental charges are adequate.
SECTION 3.13. Compliance with ERISA.
The Borrower and each member of the Controlled Group is in
compliance in all material respects with the applicable provisions of ERISA and
the Code. Except as set forth in Schedule 3.13 hereto: (i) each Plan, and to
the best of the knowledge of the Borrower and every member of the Controlled
Group, each Plan which is a Multiemployer Plan, which is intended to be tax
qualified under Section 401(a) of the Code has been determined by the Internal
Revenue Service to qualify under Section 401 of the Code, and the trusts
created thereunder have been determined to be exempt from tax under the
provisions of Section 501 of the Code (except with respect to amendments
required by legislation or regulations for which the remedial amendment period
has not lapsed), and to the knowledge of the Borrower and every member of the
Controlled Group nothing has occurred which would cause the loss of such
qualification or the imposition of any tax liability or penalty under the Code
or ERISA; (ii) with respect to each Plan (other than a Multiemployer Plan), and
each Welfare Plan, all reports required under ERISA, the Code or any other
applicable law or regulation to be filed by the Borrower or any member of the
Controlled Group with the relevant governmental authority have been duly filed
to the knowledge of the Borrower and every member of the Controlled Group and
all such reports are true and correct in all material respects as of the date
given; (iii) neither the Borrower nor any member of the Controlled Group has
engaged in a "prohibited transaction", as such term is defined in Section 4975
of the Code or in a transaction prohibited by Section 406 of ERISA, in
connection with any Plan or Welfare Plan which would subject the Borrower or
any member of the Controlled Group (after giving effect to any statutory and
regulatory exemption) to the tax on prohibited transactions imposed by Section
4975 of the Code or any other liability; (iv) no Plan which is not a
Multiemployer Plan has been, or is in the process of being, terminated nor has
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any material accumulated funding deficiency (as defined in Section 412(a) of
the Code) been incurred (without regard to any waiver granted under Section 412
of the Code), nor has any such funding waiver from the Internal Revenue Service
been received or requested, nor has the Borrower nor any member of the
Controlled Group failed to make any contributions or to pay any amounts due and
owing as required by the terms of any Plan and not within a reasonable time
cured such failure; (v) the value of the assets of each Plan (other than a
Multiemployer Plan) equalled or exceeded the present value of the accrued
benefits of each such Plan as of the end of the preceding plan year using Plan
actuarial assumptions as in effect for such plan year which assumptions are
reasonable; (vi) there has not been any Reportable Event (other than a
Reportable Event for which the 30 day notice requirement to the PBGC has been
waived under regulations issued under ERISA) or any event requiring disclosure
under Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Plan (other
than a Multiemployer Plan); (vii) there are no claims (other than claims for
benefits in the normal course), actions or lawsuits asserted or instituted
against, and neither the Borrower nor any member of the Controlled Group has
knowledge of any threatened litigation or claims or any event which could
reasonable be expected to result in litigation or claims against (a) the assets
of any Plan (other than a Multiemployer Plan) or against any fiduciary of such
Plan with respect to the operation of such Plan or (b) the assets of any
Welfare Plan or against any fiduciary thereof with respect to the operation of
any such Welfare Plan; (viii) neither the Borrower nor any member of the
Controlled Group has incurred (a) any material withdrawal liability (and no
event has occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) as determined under Section 4201 of
ERISA as a result of a complete or partial withdrawal (within the meaning of
Section 4203 or 4205 of ERISA) from a Multiemployer Plan, or (b) any material
liability (and no event has occurred which would result in such liability)
under ERISA Section 4062, 4063 or 4064 to the PBGC, to a trust established
under ERISA Section 4041 or 4042 or to a trustee appointed under ERISA Section
4042; (ix) to the best of the knowledge of the Borrower and every member of the
Controlled Group, if the Borrower or any member of the Controlled Group were to
withdraw or partially withdraw from a Multiemployer Plan, no withdrawal
liability, as determined under Section 4201 of ERISA, would result; (x) neither
the Borrower nor any member of the Controlled Group or any organization to
which the Borrower or any member of the Controlled Group is a successor or
parent corporation within the meaning of Section 4069(b) of ERISA has engaged
in a transaction within the meaning of Section 4069 of ERISA within the
previous five years; and (xi) neither the Borrower nor any member
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of the Controlled Group maintains or has established any Welfare Plan which
provides for continuing health benefits or coverage for any participant or any
beneficiary of a participant after such participant's termination of
employment, except as may be required by Section 4980B of the Code or Sections
601 through 608 of ERISA at the expense of the participant or the beneficiary
of the participant.
SECTION 3.14. Agreements.
(a) After giving effect to the Mergers and following the
refinancing of the Bankruptcy Plan Debt, neither the Borrower nor any of its
Subsidiaries is in material default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in any
agreement or instrument to which it is a party, except to the extent any such
default would not have a Material Adverse Effect.
(b) Schedule 3.14 is a true and complete listing as of
the date hereof of (i) after giving effect to the Mergers and the refinancing
of the Bankruptcy Plan Debt, all credit agreements, indentures, and other
agreements related to any Indebtedness for borrowed money of the Borrower and
its Subsidiaries, (ii) all joint venture and co-production agreements to which
the Borrower or any of its Subsidiaries is a party with respect to uncompleted
Product, all material output and multi-picture Distribution Agreements and
other Distribution Agreements giving rise to Eligible Receivables to which the
Borrower or any of its Subsidiaries is a party, and (iii) all other material
contracts and agreements (other than chain-of-title documents) entered into by
the Borrower or any of its Subsidiaries or by which the Borrower or any of its
Subsidiaries is bound. The agreements listed on Schedule 3.14 have been made
available to the Lenders.
SECTION 3.15. True and Complete Disclosure.
Neither this Agreement nor the Confidential Information
Memorandum dated October 1995 (other than the financial
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projections furnished to the Lenders prior to the date hereof (the
"Projections")) at the time it was furnished, contained any untrue statement of
a material fact or omitted to state a material fact, under the circumstances
under which it was made, necessary in order to make the statements contained
herein or therein not misleading. The Projections are based on good faith
estimates and assumptions believed to be reasonable at the time made, provided,
however, that the Borrower makes no representation or warranty that such
assumptions will prove in the future to be accurate or that the Borrower and
its Consolidated Subsidiaries will achieve the financial results reflected in
such Projections. Except as set forth in the SEC filings, at the date hereof,
there is no fact known to the Borrower which materially and adversely affects,
or is reasonably expected to materially and adversely affect the business,
properties, assets, operations or condition (financial or otherwise) of the
Credit Parties, taken as a whole (excluding general industry and economic
conditions).
SECTION 3.16. Security Interests; Other Security.
(a) This Agreement and the other Fundamental Documents,
when executed and delivered and, upon the making of the initial Loan hereunder,
will create and grant to the Agent for the benefit of the Lenders (upon the
filing of the appropriate UCC-1 financing statements and upon the filing of the
Copyright Security Agreement with the United States Copyright Office) valid and
perfected first priority perfected security interests in the Collateral subject
only to Permitted Encumbrances.
(b) No Person has, and on the date of each Borrowing
hereunder no Person will have, any right, title or interest in or to the
Collateral which is, or which shall be, prior, paramount, superior or equal to
the right, title and interest of the Agent for the benefit of the Lenders
therein or thereto, except for Permitted Encumbrances.
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SECTION 3.17. Ownership of Pledged Securities, Inactive
Subsidiaries, etc.
(a) Except as set forth on Schedule 3.17(a) or Schedule
3.17(b), neither the Borrower nor any Subsidiary on the date hereof owns any
voting stock, partnership interest or any other beneficial equity interest in
any other Person.
(b) Annexed hereto as Schedule 3.17(b) is a correct and
complete list, as of the date hereof, of each corporate Subsidiary of the
Borrower showing, as to each such Subsidiary of the Borrower, its name, the
jurisdiction of its incorporation, its authorized capitalization, the number of
shares of its capital stock outstanding, and the ownership of the capital stock
of each such Subsidiary of the Borrower.
(c) Annexed hereto as Schedule 3.17(c) is a correct and
complete list of each Inactive Subsidiary. No Inactive Subsidiary owns any
assets or engages in any business activities of any nature.
SECTION 3.18. Ownership of Product; Copyrights and Other
Rights.
On the date hereof, the Product listed on Schedule 3.18(a)
comprises all of the Product in which the Borrower or any of its Subsidiaries
has any right, title or interest in or to (either directly or through a joint
venture or partnership). As to each item listed on Schedule 3.18(b) hereto the
party holding such interests has duly recorded its interests in the United
States Copyright Office and has delivered copies of all such recordation to the
Agent. All Product and all component parts thereof do not and will not violate
or infringe upon in any material respect any copyright, right of privacy,
trademark, patent, trade name, performing right or any literary, dramatic,
musical, artistic, personal, private, contract or copyright right or any other
right of any Person or contain any libelous or slanderous material. There is
no claim, suit, action or proceeding pending or to the knowledge of any Credit
Party, threatened against the Borrower or any of its Subsidiaries that involves
a claim of infringement of any copyright with respect to any Product listed on
Schedule 3.18(a) or Schedule 3.18(b) and no Credit Party has knowledge of any
existing infringement by any
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other Person of any copyright held by the Borrower or any of its Subsidiaries
with respect to any Product listed on Schedule 3.18(a) or Schedule 3.18(b),
which in each case could reasonably be expected to have a Material Adverse
Effect.
SECTION 3.19. Distribution Rights.
Each Credit Party has sufficient right, title and interest in
each item of Product to enable it to enter into and perform all agreements
generating Eligible Receivables and accounts receivable reflected on the most
recently delivered balance sheet of the Borrower and is not in breach of any of
its obligations under such agreements, nor does the Borrower have knowledge of
any breach, including an anticipatory breach, of any other parties thereto
which, in the case of accounts receivable (other than Eligible Receivables)
such breach could reasonably be expected to have a Material Adverse Effect.
SECTION 3.20. Fictitious Names.
Except as set forth on Schedule 3.20, no Credit Party has done
business within the last five years, is doing business or intends to do
business other than under its full corporate name, including, without
limitation, under any trade name or other doing business name.
SECTION 3.21. Compliance with Laws.
Neither the Borrower nor any of its Subsidiaries is in
violation of any Applicable Law except for violations which could not
reasonably be expected to have a Material Adverse Effect. The borrowings
hereunder, the intended use of the proceeds of the Loans as described in the
preamble hereto and as contemplated by Section 5.8 and any other transactions
contemplated hereby will not violate any Applicable Law.
SECTION 3.22. Environmental Liabilities.
(a) No Credit Party has, to the best of its knowledge,
used, stored, treated, transported, manufactured, refined, handled, produced or
disposed of any Hazardous Materials on, under, at, from, or in any way
affecting, any of its properties or assets, or otherwise, in any manner which
at the time of the
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action in question violated any Environmental Law governing the use, storage,
treatment, transportation, manufacture, refinement, handling, production or
disposal of Hazardous Materials and to the best of the Credit Parties'
knowledge, no prior owner of such property or asset or any tenant, subtenant,
prior tenant or prior subtenant thereof has used Hazardous Materials on or
affecting such property or asset, or otherwise, in any manner which at the time
of the action in question violated any Environmental Law governing the use,
storage, treatment, transportation, manufacture, refinement, handling,
production or disposal of Hazardous Materials, except in each instance such
violations as in the aggregate would not have a Material Adverse Effect.
(b) To the best of the Credit Parties' knowledge, no
Credit Party has any obligations or liabilities, known or unknown, matured or
not matured, absolute or contingent, assessed or unassessed, where such would
reasonably be expected to have a Material Adverse Effect on any Credit Party
and no claims have been made against any Credit Party during the past five
years and no presently outstanding citations or notices have been issued
against any Credit Party, where such could reasonably be expected to have a
Material Adverse Effect on any Credit Party, which in either case have been or
are imposed by reason of or based upon any provision of any Environmental Law,
including, without limitation, any such obligations or liabilities relating to
or arising out of or attributable, in whole or in part, to the manufacture,
processing, distribution, use, treatment, storage, disposal, transportation or
handling of any Hazardous Materials by any Credit Party or any of its
employees, agents representatives or predecessors in interest in connection
with or in any way arising from or relating to any Credit Party or any of its
respective properties, or relating to or arising from or attributable, in whole
or in part, to the manufacture, processing, distribution, use, treatment,
storage, disposal, transportation or handling of any such substance, by any
other Person at or on or under any of the real properties owned or used by any
Credit Party or any other location where such could have a Material Adverse
Effect.
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SECTION 3.23. Fiscal Year.
In connection with the Mergers, the Borrower has changed its
fiscal year end to December 31.
4. CONDITIONS OF LENDING
SECTION 4.1. Conditions Precedent to the Initial Loan.
The obligation of each Lender and the Issuing Bank to make its
initial Loan or to issue and purchase participations in the initial Letter of
Credit is subject to the following conditions precedent:
(a) Corporate Documents of Credit Parties. On or prior
to the making of the initial Loans, the Agent shall have received with respect
to each Credit Party (except for the items described in clause (iii) below),
with copies for each of the Lenders:
(i) a copy of such Credit Party's certificate of
incorporation certified as of a recent date by the Secretary
of State of the State of such Credit Party's incorporation;
(ii) a certificate of each such Secretary of
State, dated as of a recent date, as to the good standing of
and payment of taxes by such Credit Party, which lists the
charter documents on file in the office of such Secretary of
State;
(iii) a certificate dated as of a recent date as to
the good standing of the Borrower issued by the Secretary of
State of each jurisdiction in which the Borrower is qualified
as a foreign corporation;
(iv) a certificate of the Secretary of such Credit
Party dated the date of the initial Loans and certifying (A)
that attached thereto is a true and complete copy of the
by-laws of such Credit Party as in effect on the date of such
certification, (B) that attached thereto is a true and
complete copy of resolutions adopted by the Board of Directors
of such
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Credit Party authorizing the execution, delivery and
performance in accordance with their respective terms of the
Fundamental Documents executed by such Credit Party and any
other documents required or contemplated hereunder or
thereunder, the grant of the security interests in the
Collateral, and in the case of the Borrower, the borrowings
hereunder and that such resolutions have not been amended,
rescinded or supplemented and are currently in effect, (C)
that the certificate of incorporation of such Credit Party has
not been amended since the date of the last amendment thereto
indicated on the certificate of the Secretary of State
furnished pursuant to clause (i) above and (D) as to the
incumbency and specimen signature of each officer executing
any Fundamental Document on behalf of such Credit Party or any
other document delivered by it in connection herewith or
therewith (such certificate to contain a certification by
another officer of such Credit Party as to the incumbency and
signature of the officer signing the certificate referred to
in this clause (iv)); and
(v) such additional supporting documents as the
Agent or its counsel or any Lender may reasonably request.
(b) Notes. The Agent shall have received the Notes,
dated as of the date hereof, duly executed by the Borrower.
(c) Security and Other Documentation. The Agent shall
have received (i) two duly executed original counterparts of the Copyright
Security Agreement listing each item of Product in which any Credit Party has a
copyrightable interest executed by each Credit Party which is a copyright
proprietor of such item of Product or which otherwise owns a copyrightable
interest thereto, (ii) two duly executed original counterparts of each of the
Pledge Agreements accompanied by the Pledged Securities, with undated stock
powers executed in blank and (iii) the appropriate UCC-1 financing statements
relating to the Collateral.
(d) Security Interests in Copyrights and other
Collateral. The Agent shall have received evidence reasonably satisfactory to
it that the Credit Parties have sufficient right,
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title and interest in and to the Collateral which they purport to own
(including appropriate licenses under copyright), as set forth in their
financial statements and in other documents presented to the Lenders to enable
them to perform the Distribution Agreements and to grant to the Agent for the
benefit of the Lenders the security interests contemplated by this Agreement.
(e) Subordination Agreements. The Agent shall have
received two duly executed counterparts of each Subordination Agreement.
(f) Guaranty Agreement. The Agent shall have received
two duly executed counterparts of the Guaranty Agreement.
(g) Mergers Completed. The Mergers and the MCEG Transfer
shall have been consummated on terms satisfactory to the Agent.
(h) Laboratory Access Letters and Pledgeholder
Agreements. The Agent shall have received duly executed Laboratory Access
Letters from the Borrower's principal Laboratories covering all Completed
Product which the Credit Parties only have access rights to and duly executed
Pledgeholder Agreements for each item of Product for which any Credit Party has
control over any physical elements thereof as listed on Schedule 3.18.
(i) Opinions of Counsel. The Agent shall have received
the written opinions dated the date hereof and addressed to the Agent and the
Lenders (i) substantially in the forms attached hereto as Exhibits H-1 and H-2,
each in form and substance reasonably satisfactory to the Agent, of ▇▇▇▇,
▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Credit Parties and (ii)
substantially in the form attached hereto as Exhibit H-3, in form and substance
reasonably satisfactory to the Agent, of ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to
the Credit Parties.
(j) UCC Financing Statements. The Agent shall have
received, in form reasonably satisfactory to it, UCC financing statements
executed on behalf of each Credit Party for filing in all jurisdictions in
which the Agent deems necessary or desirable to make a filing in order to
provide the Agent (for the benefit
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of the Lenders) with a perfected security interest in the Collateral.
(k) Borrowing Base Certificate. The Agent shall have
received an initial Borrowing Base Certificate dated as of September 30, 1995
substantially in the form attached hereto as Exhibit J demonstrating in detail
that the Borrowing Base equals or exceeds $135,000,000.
(l) Existing Indebtedness. Simultaneously with the
making of the initial Loans, the Bankruptcy Plan Debt shall have been paid in
full, and all security interests, liens and other Encumbrances granted
thereunder shall have been released except Permitted Encumbrances.
(m) Financial Statements. The Agent and the Lenders
shall have received and be satisfied with the true and complete copies of all
of the financial statements referred to in Section 3.4.
(n) Payment of Fees. The Borrower shall have paid all
costs and fees which the Agent and the Lenders are entitled to receive on the
Closing Date pursuant to the terms of this Agreement or the Fee Letter, which
costs and fees have been invoiced at or prior to the making of the initial
Loans.
(o) Priority and Contribution Agreement. The Agent shall
have received the Priority and Contribution Agreement, duly executed by all
parties thereto.
(p) No Material Adverse Change. Since February 28, 1995
there shall have been no event or events which have had a Material Adverse
Effect which have not been disclosed in the SEC Filings.
(q) Insurance. The Borrower shall have furnished the
Agent with (i) a summary of all existing insurance coverage, (ii) evidence
acceptable to the Agent that the insurance policies required by Section 5.3
have been obtained and are in full force and effect and (iii) Certificates of
Insurance with respect to all existing insurance coverage which certificates
shall name Chemical Bank, as Agent, as the certificate holder and shall
evidence the Borrower's compliance with Section 5.3(f) with
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respect to all insurance coverage existing as of the Closing Date.
(r) Delivery of Agreements. The Agent shall have
received and be satisfied with the terms and provisions of all agreements
listed on Schedule 3.14 to the extent requested by the Agent.
(s) Borrowing Certificate. The Agent shall have received
the initial Borrowing Certificate duly executed on behalf of the Borrower by an
Authorized Officer.
(t) Notices of Assignment and Irrevocable Instructions.
The Agent shall have received, with respect to each Eligible Receivable
included in the initial Borrowing Base Certificate, a Notice of Assignment and
Irrevocable Instructions executed by the appropriate Credit Party.
(u) Required Consents and Approvals. The Agent shall be
satisfied that all required consents and approvals have been obtained with
respect to the transactions contemplated hereby from all Governmental
Authorities with jurisdiction over the business and activities of any Credit
Party as of the date hereof, and from any other entity whose consent or
approval the Agent in its reasonable discretion deems necessary to consummate
the transactions contemplated hereby.
(v) Parent Investment. The Parent shall have invested at
least $72,000,000 in the Borrower in the form of equity or Subordinated
Indebtedness on terms and conditions satisfactory in all respects to the Agent.
(w) Approval of Counsel to the Agent. All legal matters
incident to this Agreement and the transactions contemplated hereby shall be
reasonably satisfactory to ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel to the Agent.
(x) Other Documents. The Agent shall have received such
other documentation as the Agent may reasonably request.
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SECTION 4.2. Condition Precedent to Each Loan and Each Letter
of Credit.
The obligations of the Lenders and the Issuing Bank to make
each Loan and to issue and purchase participations in each Letter of Credit are
subject to the following conditions precedent:
(a) Notice. The Agent shall have received a notice with
respect to such Borrowing or the Issuing Bank shall have received a notice with
respect to such Letter of Credit as required by Article 2 hereof.
(b) Borrowing Certificate. The Agent shall have received
a Borrowing Certificate with respect to such Borrowing, duly executed by an
Authorized Officer of the Borrower.
(c) Representations and Warranties. The representations
and warranties set forth in Article 3 hereof shall be true and correct in all
material respects on and as of the date of each Borrowing or the issuance of
each Letter of Credit hereunder (except to the extent that such representations
and warranties relate solely to an earlier date and except as affected by
transactions expressly contemplated hereby), with the same effect as if made on
and as of such date.
(d) No Revolving Loan Event of Default. On the date of
each Borrowing or the issuance of each Letter of Credit, no Revolving Loan
Event of Default or Revolving Loan Default shall have occurred and be
continuing.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the matters and to the extent
specified in paragraphs (b) through (d) of this Section.
5. AFFIRMATIVE COVENANTS
Each of the Credit Parties covenants and agrees that from the
date hereof and until (i) the payment in full of (x) all Commitment Fees
payable hereunder and (y) the principal of and the interest on the Notes, (ii)
the satisfaction of all other Obligations, (iii) the termination of the
Commitments (including
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any commitment to issue any Letter of Credit), (iv) the expiration, termination
or cancellation of all Letters of Credit and (v) the termination of this
Agreement, unless the Required Lenders shall otherwise consent in writing, each
of them will:
SECTION 5.1. Financial Statement, Reports, etc.
(a) Furnish to the Lenders, as soon as available, but in
any event within 90 days after the end of each fiscal year of the Borrower
commencing with fiscal year ending December 31, 1995 the audited consolidated
balance sheet of each of the Parent and its Consolidated Subsidiaries and the
Borrower and its Consolidated Subsidiaries as at the end of, and the related
consolidated statements of income, stockholders' equity and cash flows (along
with the related notes and supplemental information) for such year, and the
comparative financial statements as at the end of, and for, the preceding
fiscal year, if any, accompanied by an auditor's report and opinion of KPMG
Peat Marwick LLP or such other independent public accountants of nationally
recognized standing as shall be retained by the Parent and reasonably
acceptable to the Agent, which report shall be prepared in accordance with
generally accepted auditing standards relating to reporting and which report
shall be unqualified as to the scope of audit and as to the status of the
Borrower as a going concern and shall state that such financial statements
fairly present the financial condition of each of the Parent and its
Consolidated Subsidiaries and the Borrower and its Consolidated Subsidiaries as
at the dates indicated and the results of its operations and cash flows for the
periods indicated in conformity with GAAP (except for accounting changes in
response to FASB releases or other authoritative pronouncements with which such
independent public accountants concur); and an Authorized Officer of each of
the Parent and the Borrower shall certify that such financial statements fairly
present the financial condition of the Parent and the Borrower on a
consolidated basis as at the dates indicated and the results of its operations
and cash flows for the periods indicated in conformity with GAAP;
(b) Furnish to the Lenders, as soon as available, but in
any event within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, the unaudited consolidated and
consolidating balance sheet of each of
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the Parent and its Consolidated Subsidiaries and the Borrower and its
Consolidated Subsidiaries as at the end of, and the related unaudited
statements of income, cash flow and stockholders' equity for, such quarter and
for the period from the beginning of the then current fiscal year to the end of
such fiscal quarter, in each case consistent with prior practice and showing
intercompany eliminations certified by an Authorized Officer of each of the
Parent and the Borrower, to the effect that such financial statements, although
not examined by independent public accountants, reflect all adjustments
necessary to fairly present the financial position of the Parent and the
Borrower as at the dates indicated and the results of their operations for the
periods indicated in conformity with GAAP, subject only to year-end and audit
adjustments;
(c) Furnish to the Lenders, together with the delivery of
the statements referred to in paragraphs (a) and (b) of this Section 5.1, a
certificate of an Authorized Officer of each of the Parent and the Borrower
substantially in the form of Exhibit I hereto (i) stating that the signer has
reviewed the terms of this Agreement and has made such examinations and
investigations as are deemed necessary to express an informed opinion whether
any condition or event which would constitute an Event of Default or Default
and stating whether or not he has knowledge of any such condition or event and,
if so, specifying each such condition or event of which he has knowledge and
the nature thereof and (ii) demonstrating in reasonable detail compliance with
the provisions of Sections 6.20, 6.22 and 6.23.
(d) Furnish to the Lenders, together with each set of
audited financial statements required by paragraph (a) above, a report from the
independent public accountants rendering the report thereon (i) stating that
such Person has made such examination or investigation as is necessary to
enable it to express an informed opinion as to the matters referred to in
clause (ii) of this Section 5.1(d), it being understood that no special audit
procedures are required hereby and (ii) stating whether, in connection with
their audit examination, any condition or event, at any time during or at the
end of the accounting period covered by such financial statements, which
constitutes an Event of Default has come to their attention, and if such a
condition or event has come to their attention, specifying the nature and
period, if known, of existence thereof;
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(e) Deliver to the Agent, on or prior to each Borrowing
Base Delivery Date, a certificate substantially in the form of Exhibit J hereto
(a "Borrowing Base Certificate") setting forth the amount of each component to
be included in the Borrowing Base as of the Borrowing Base Calculation Date
immediately preceding such Borrowing Base Delivery Date attached to which shall
be detailed information including the calculation of each such component in the
form attached to the Borrowing Base Certificate;
(f) Deliver to the Agent, within 10 days of receipt
thereof, copies of all reports submitted by independent public accountants to
the Parent or the Borrower in connection with each annual, interim or special
audit of the financial statements of the Parent or the Borrower, including,
without limitation, the comment letter submitted by such accountants to
management in connection with their annual audit;
(g) Deliver to the Agent, on the monthly Borrowing Base
Delivery Date, an aging of receivables;
(h) Promptly upon their becoming available, copies of all
financial statements, reports, notices and proxy statements sent or made
available by the Parent, the Borrower or any of the Parent's Subsidiaries to
its security holders generally, of all regular and periodic reports and all
registration statements and prospectuses, if any, filed by any of them with any
securities exchange or with the Securities and Exchange Commission, or any
comparable foreign bodies, and of all press releases and other statements made
available generally by any of them to the public concerning material
developments in the business of the Parent, the Borrower or any of the Parent's
Subsidiaries;
(i) Deliver to the Agent, promptly upon any Executive
Officer of any Credit Party obtaining knowledge (a) of any Default, or becoming
aware that any Lender has given notice or taken any other action with respect
to a claimed Event of Default or (b) that any Person has given any notice to
any Credit Party or taken any other action with respect to a claimed default or
event or condition of the type referred to in Section 7.1(f), a certificate of
an Authorized Officer of the Borrower, specifying the nature and period of
existence of any such condition or event, or specifying the notice given or
action taken by such
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holder or Person and the nature of such claimed Event of Default or condition
and what action the Borrower has taken, is taking and proposes to take with
respect thereto;
(j) Deliver to the Agent, promptly upon any Executive
Officer of the Borrower obtaining knowledge of (i) the institution of, or
threat in writing of, any action, suit, proceeding, investigation or
arbitration by any Governmental Authority or other Person against or affecting
a Credit Party or any of their respective assets which could reasonably be
expected to have a Material Adverse Effect, or (ii) any material development in
any such action, suit, proceeding, investigation or arbitration (whether or not
previously disclosed to the Lenders), notice thereof to the Agent and provide
such other information as may be reasonably available to it (without waiver of
any applicable evidentiary privilege) to enable the Lenders to evaluate such
matters; and, in addition to the requirements set forth in clauses (i) and (ii)
of this Section, the Borrower upon request shall promptly give notice of the
status of any action, suit, proceeding, investigation or arbitration covered by
a report delivered to the Agent pursuant to clause (i) and (ii) above to the
Lenders and provide such other information as may be reasonably available to it
to enable the Lenders to evaluate such matters;
(k) Deliver to the Lenders, within 90 days after the end
of each fiscal year, in the form previously delivered to the Agent, a net worth
certificate for each of the Guarantors, which net worth certificate shall
certify that either Metromedia or ▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ have a net
worth of at least $1,000,000,000;
(l) Deliver to the Agent, (a) 5 days prior to the
commencement of principal photography of an item of Product to be produced by a
Credit Party or for which a Credit Party has a financial risk (i.e., payment by
the Credit Party is not conditioned upon delivery) (or such later date that is
acceptable to the Agent) and (b) 5 days prior to payment of the acquisition
cost for a Negative Pickup (or such later date that is acceptable to the Agent)
each of the following to the extent applicable (it being understood that for
purposes of subparagraph (b), clauses (i), (viii) and (ix) shall not be
applicable), (i) the budget for such item of Product, (ii) a schedule
identifying all agreements
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executed by a Credit Party in connection with such item of Product which
provide for deferments of compensation or a gross or net profit participation,
(iii) copies of such of the foregoing agreements as the Agent may reasonably
request, (iv) certificates or binders of insurance with respect to such item of
Product (and policies of insurance if requested by the Agent), including all
forms of insurance coverage required by Section 5.3 hereof for items of Product
described in subparagraph (a) of this Section 5.1(l) and the insurance coverage
required by Section 5.3(d) for items of Product described in subparagraph (b)
of this Section 5.1(l), (v) copies of all instruments of transfer or other
instruments (in recordable form) necessary to establish, to the reasonable
satisfaction of the Agent, in the appropriate Credit Party ownership of
sufficient copyright rights in the literary properties upon which such item of
Product is to be based to enable such Credit Party to produce and/or distribute
such item of Product and to grant the Agent the security interests therein
which are contemplated by this Agreement which documents shall evidence to the
Agent's reasonable satisfaction the Credit Party's rights in, and with respect
to, such item of Product, (vi) an executed Copyright Security Agreement
Supplement with respect to such item of Product, (vii) executed Pledgeholder
Agreements or Laboratory Access Letters, as appropriate, with respect to such
item of Product, (viii) a schedule of sources and uses demonstrating in detail
the sources and uses of all cash necessary to complete and deliver the Product
and (ix) a Completion Guaranty with respect to such Product in form and
substance satisfactory to the Agent naming the Agent, for the benefit of the
Lenders, as a beneficiary thereof to the extent of the Borrower's financial
interest in such Product;
(m) Deliver to the Agent, within 15 days of the end of
each calendar month with respect to each item of Product being produced by the
Borrower from the beginning of preproduction for such item of Product until
such item of Product is Completed, all periodic financial reports prepared by
or for any Credit Party with respect to each such item of Product, including a
monthly statement of the Borrower's cost basis in such item of Product and the
estimated cost to complete such item of Product;
(n) Deliver to the Agent within 30 days of the end of
each June 30 and December 31, updated cash flow projections for the ensuing
four quarters in the format previously delivered to
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the Lenders demonstrating that sufficient cash will be available from
operations, borrowings under this Agreement and amounts committed to be funded
by third parties approved by the Agent, as and when needed to fund all
reasonably anticipated cash requirements;
(o) Deliver to the Agent, within 30 days after each
theatrical item of Product produced by a Credit Party is Completed, a tentative
negative cost statement, and within 120 days after each theatrical item of
Product is Completed, the final negative cost statement; and
(p) Deliver to the Agent, with reasonable promptness,
such other information and data with respect to the Credit Parties or any
Special Purpose Distributor from time to time as may be reasonably requested by
the Agent on behalf of the Lenders.
SECTION 5.2. Corporate Existence; Compliance with Statutes.
Do or cause to be done all things necessary to (i) preserve,
renew and keep in full force and effect its corporate existence, rights,
licenses, permits and franchises required to conduct its businesses and (ii)
comply in all respects with all applicable statutes, regulations and orders of,
and all applicable restrictions imposed by, any Governmental Authority, except
to the extent that the failure to do any of the foregoing would not reasonably
be expected to result in a Material Adverse Effect.
SECTION 5.3. Insurance.
(a) Keep its assets which are of an insurable character
insured (to the extent and for time periods consistent with normal U.S. motion
picture industry practices) by financially sound and reputable insurers against
loss or damage by fire, explosion, theft or other hazards which are included
under extended coverage and in an amount not less than the insurable value of
the property insured or such lesser amounts, and with such self-insured
retention or deductible levels, as are consistent with normal U.S. motion
picture industry practices.
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(b) Maintain with financially sound and reputable
insurers, insurance against loss or damage due to fire, explosion, theft or
other hazards and risks and liability to persons and property to the extent and
in the manner customary for major independent production companies in the U.S.
motion picture industry in connection with motion pictures of like size and
type as the Product; provided, however, that workers' compensation insurance or
similar coverage may be effected with respect to its operations in any
particular state or other jurisdiction through an insurance fund operated by
such state or jurisdiction.
(c) Upon the request of the Agent, the Borrower will
render to the Agent a statement in such detail as the Agent may request as to
all such insurance coverage.
(d) Maintain, or cause to be maintained, in effect during
the period from the commencement of principal photography of each item of
Product produced by any Credit Party, through the third anniversary of the date
on which such item of Product is completed in the U.S. and/or as otherwise
required by applicable contracts, an "Errors and Omissions" policy to provide
coverage to the extent and in such manner as is customary in the U.S. motion
picture industry for motion pictures of like type but, at minimum, to the
extent and in such manner as is required under all applicable contracts
relating thereto.
(e) Maintain, or cause to be maintained, in effect during
the period from the commencement of principal photography of each item of
Product produced by any Credit Party (1) until such time as the Agent shall
have been provided with satisfactory evidence of the existence of one negative
in one location and an interpositive or internegative in another location of
the final theatrical version of the Completed Product, insurance on the
negatives and sound tracks of such item of Product in an amount not less than
the cost of re-shooting the principal photography of the item of Product, and
(2) until principal photography of such item of Product has been concluded, a
cast insurance policy with respect to such item of Product, which provides
coverage to the extent and in such manner as is customary in the U.S. motion
picture industry for motion pictures of a like type, but at minimum, to the
extent required under all applicable contracts relating thereto.
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(f) Cause all such above-described insurance (excluding
workers' compensation insurance) to (1) provide for the benefit of the Lenders
that 30 days' prior written notice of suspension, cancellation, termination,
modification, non-renewal or lapse or material change of coverage shall be
given to the Agent; (2) name the Agent for the benefit of the Lenders and any
other party providing financing for such item of Product as the loss payee
(except for errors and omissions insurance and other third party liability
insurance), provided, however, that production insurance recoveries received
prior to completion or abandonment of an item of Product may be utilized to
finance the production of such item of Product; and (3) to the extent that
neither the Agent nor the Lenders shall be liable for premiums or calls, name
the Agent for the benefit of the Lenders as an additional insured including,
without limitation, under any "Errors and Omissions" policy.
SECTION 5.4. Completion Guaranties.
Obtain a Completion Guaranty from an Approved Completion
Guarantor on terms and conditions satisfactory to the Agent naming the Agent
for the benefit of the Lenders as a beneficiary thereunder to the extent of the
Credit Party's financial interest for all Product which a Credit Party is
producing or in which a Credit Party has an Investment which is subject to
completion risk.
SECTION 5.5. Taxes and Charges; Obligations in Ordinary
Course of Business.
Duly pay and discharge, or cause to be paid and discharged,
before the same shall become delinquent and/or the basis for penalties
(monetary or otherwise) or interest assessment, all federal, state or local
taxes, assessments, levies and other governmental charges, imposed upon the
Borrower, any of its Subsidiaries (other than an Inactive Subsidiary) or their
respective properties, sales and activities, or any part thereof, or upon the
income or profits therefrom, as well as all claims for labor, materials or
supplies which if unpaid might by law become a Lien upon any of the property of
the Borrower or any Subsidiary (other than an Inactive Subsidiary); provided,
however, that any such tax, assessment, charge, levy or claim need not be paid
if the validity or amount thereof shall
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currently be contested in good faith by appropriate proceedings and if the
Borrower shall have set aside on its books proper reserves (to the extent
required by GAAP) adequate with respect thereto if reserves shall be deemed
necessary by such Person in accordance with GAAP; and provided, further, that
the Borrower will pay all such taxes, assessments, levies or other governmental
charges forthwith upon the commencement of proceedings to foreclose any Lien
which may have attached as security therefor. Each Credit Party will promptly
pay and the Borrower shall cause each Excluded Subsidiary to promptly pay when
due all other obligations incident to its respective operations; provided,
however, that any such obligations need not be paid if the payment thereof
shall currently be contested in good faith by appropriate proceedings and if
the Borrower shall have set aside on its books proper reserves (to the extent
required by GAAP) adequate with respect thereto if reserves shall be deemed
necessary; and provided, further, the Borrower will pay all such obligations
forthwith upon the commencement of procedures to foreclose any Lien which may
have attached as security therefor.
SECTION 5.6. Chief Executive Office; Corporate Name.
No Credit Party will change its name or the location of its
chief executive offices or any of the offices where any such entity keeps the
books and records (including records on Eligible Receivables) with respect to
the Collateral owned by it or move any Collateral from the locations presently
kept (except as permitted in Section 5.17) without (i) giving the Agent 15
days' written notice of such change or move and (ii) filing any additional UCC
financing statements and such other documents reasonably requested by the Agent
or which are otherwise necessary or desirable to continue the first perfected
security interest of the Agent for the benefit of the Lenders in the
Collateral.
SECTION 5.7. ERISA Compliance and Reports.
(a) For each Plan (including each such Plan which is
hereafter adopted by the Borrower or any member of the Controlled Group) which
is intended to be tax qualified under Section 401(a) of the Code: the Borrower
shall, or shall cause such member of the Controlled Group to, (a) from and
after the adoption of any
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Plan, use its best efforts to cause such Plan to be qualified within the
meaning of Section 401(a) of the Code and to be administered in all material
respects in accordance with the requirements of ERISA and Section 401(a) of the
Code; and (b) not take any action which would cause such Plan not to be
qualified within the meaning of Section 401(a) of the Code or not to be
administered in all material respects in accordance with the requirements of
ERISA and Section 401(a) of the Code.
(b) As soon as possible, and in any event within 10
Business Days after the Borrower or any member of the Controlled Group knows or
has reason to know that the Borrower or any member of the Controlled Group (i)
will give or is required to give notice to the PBGC of any Reportable Event
with respect to any Plan which might constitute grounds for a termination of
such Plan under Title IV of ERISA, or knows that the plan administrator of any
Plan has given or is required to give notice of any such Reportable Event; or
(ii) receives notice from the PBGC under Title IV of ERISA of an intent to
terminate or appoint a trustee to administer any Plan, the Borrower shall, and
shall cause such member of the Controlled Group to, deliver to the Agent at the
Borrower's expense, a statement of the chief financial officer of the Borrower
or such member of the Controlled Group describing such event, together with a
copy of the notice of such Reportable Event given or required to be given to
the PBGC or a copy of such notice from the PBGC, and any correspondence with,
or filings made with, the PBGC or the Department of Labor, and the action, if
any, which the Borrower or such member of the Controlled Group proposes to take
with respect thereto.
(c) The Borrower shall and shall cause each member of the
Controlled Group to deliver to the Agent at the Borrower's expense: (i) if
requested by the Agent, promptly after the filing thereof by the Borrower or
such member of the Controlled Group with the Department of Labor or Internal
Revenue Service or the PBGC, copies of each annual and other report with
respect to each Plan or Welfare Plan; (ii) promptly after receipt thereof, a
copy of any notice, determination letter, ruling or opinion that the Borrower
or such member of the Controlled Group may receive from the PBGC, Department of
Labor or Internal Revenue Service with respect to any Plan or Welfare Plan
(other than notices, determination letters, rulings or opinions of general
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applicability); (iii) promptly and in any event within 10 Business Days after
receipt thereof, a copy of any correspondence that the Borrower or such member
of the Controlled Group receives or receives from the Plan Sponsor (as defined
by Section 4001(a)(10) of ERISA) of any Plan concerning potential withdrawal
liability pursuant to Section 4219 of ERISA and/or Section 4202 of ERISA, and a
statement from the chief financial officer of the Borrower or such member of
the Controlled Group setting forth details as to the events giving rise to such
potential withdrawal liability and the action which the Borrower or such member
of the Controlled Group proposes to take with respect thereto; (iv)
notification within 10 Business Days of any intention of the Borrower or any
member of the Controlled Group to withdraw, in whole or in part, from any
Multiemployer Plan; (v) notification within 30 Business Days of any material
increases in the benefits of, or contributions to, any existing Plan or Welfare
Plan or the establishment of any new Plans or Welfare Plans, or the
commencement of contributions to any such Plan to which the Borrower or such
member of the Controlled Group was not previously contributing; (vi)
notification within 30 Business Days of any Reportable Event with respect to
any Plan (other than a Reportable Event for which the 30 day notice requirement
to the PBGC has been waived under regulations issued under ERISA); and (vii)
notification within 10 Business Days of a request for a minimum funding waiver
or the incurrence of an accumulated funding deficiency under Section 412 of the
Code with respect to any Plan or any failure by the Borrower or any member of
the Controlled Group to make a required contribution to any Plan and not within
a reasonable time cured such deficiency.
SECTION 5.8. Use of Proceeds.
(a) Use the proceeds of the Term Loans solely to
refinance a portion of the Bankruptcy Plan Debt.
(b) Use the proceeds of the Revolving Credit Loans solely
to (i) finance the Borrower's development, production (both directly and
through certain of the Corporate Guarantors), acquisition, worldwide
distribution and exploitation of motion pictures, video product and
made-for-television product (other than the production of newly created
deficit-financed made-for-television programming), in each case, including
ancillary rights therein and (ii) for general working capital purposes.
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SECTION 5.9. Access to Books and Records; Examinations.
(a) Maintain or cause to be maintained at all times true
and complete books and records of its financial operations (in accordance with
GAAP); and provide the Agent and its designated representatives access after
reasonable notice to all such books and records and to any of its properties or
assets during regular business hours, in order that the Agent may make such
examinations and make abstracts from such books, accounts, records and other
papers pertaining to the Collateral and may discuss the affairs, finances and
accounts with, and be advised as to the same by, officers and independent
accountants, all as the Agent may reasonably deem appropriate for the purpose
of verifying the accuracy of the Borrowing Base Certificates and the various
other reports delivered by any Credit Party to the Agent pursuant to this
Agreement or for otherwise ascertaining compliance with this Agreement or any
other Fundamental Documents. Each of the Credit Parties hereby authorizes the
Agent following notice to the Borrower to confirm with account debtors and
other payors the amounts and terms of all Eligible Receivables included in the
Borrowing Base. Each of the Credit Parties hereby agrees that, upon the
occurrence and during the continuance of an Event of Default, the Agent shall
be entitled to confirm directly with account debtors the amounts and terms of
all accounts receivable. The Agent ▇▇▇▇▇▇ agrees to provide the applicable
Credit Party with copies of any written request sent by the Agent to such
account debtors.
(b) Provide the Agent and its representatives reasonable
access to any such material properties during regular business hours in order
that the Agent or its representatives may inspect such properties and may
discuss the affairs and finances and accounts with, and be advised as to the
same by, officers and (upon prior notice to the Borrower) independent
accountants, all as the Agent may deem appropriate for ascertaining compliance
with this Agreement.
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SECTION 5.10. Third Party Audit Rights.
Promptly notify the Agent of, and allow the Agent access to
the results of, all audits conducted by a Credit Party of any third party
licensee, partnership and joint venture under any material agreement with
respect to any item of Product included in the Collateral. Each Credit Party
will exercise its audit rights with respect to any third party licensees,
partnerships and joint ventures under any agreement with respect to an item of
Product included in the Collateral upon the reasonable request of the Agent,
provided, however, that if the Credit Party shall object to performing such
audit, the audit shall not be undertaken and the receivables in the Borrowing
Base from such third party licensee, partnership or joint venture in connection
with the item of Product shall be eliminated from the Borrowing Base. After
any Event of Default has occurred and is continuing, the Agent shall have the
right to exercise through any Credit Party such Credit Party's right to audit
any obligor under an agreement with respect to any item of Product included in
the Collateral.
SECTION 5.11. Maintenance of Properties.
Keep its properties which are material to the business in good
repair, working order and condition and, from time to time, (i) make all
necessary and proper repairs, renewals, replacements, additions and
improvements thereto and (ii) comply at all times with the provisions of all
material leases and other material agreements to which it is a party so as to
prevent any loss or forfeiture thereof or thereunder unless compliance
therewith is being currently contested in good faith by appropriate proceedings
and appropriate reserves have been established in accordance with GAAP.
SECTION 5.12. Material Adverse Effect.
Promptly report to the Agent and the Lenders, after any
Executive Officer of a Credit Party obtains knowledge of same, any event or
series of events which would have a Material Adverse Effect.
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SECTION 5.13. Further Assurances; Security Interests.
(a) Upon the request of the Agent, duly execute and
deliver, or cause to be duly executed and delivered, at the cost and expense of
the Borrower, such further instruments as may be necessary or proper, in the
reasonable judgment of the Agent, to carry out the provisions and purposes of
this Agreement and the other Fundamental Documents, and to do, all things
necessary or proper, in the reasonable judgment of the Agent, to provide,
perfect or preserve the Liens hereunder and under the Fundamental Documents,
and in the Collateral, the Pledged Securities and any portion of any of the
foregoing.
(b) Upon the request of the Agent, promptly perform or
cause to be performed any and all acts and execute or cause to be executed, at
the cost and expense of Borrower, any and all documents (including, without
limitation, the execution, amendment or supplementation of any financing
statement and continuation statement or other statement) for filing under the
provisions of the UCC and the rules and regulations thereunder, or any other
statute, rule or regulation of any applicable foreign, federal, state or local
jurisdiction, which are necessary or advisable in the judgment of the Agent,
from time to time, in order to grant and maintain in favor of the Agent for the
benefit of the Lenders as beneficiaries thereof the perfected security interest
in the Collateral contemplated by the Fundamental Documents and a pledge of the
Pledged Securities of the Credit Parties as provided for in the Pledge
Agreements and to carry out the provisions and purposes of the Fundamental
Documents.
(c) Promptly deliver or cause to be delivered to the
Lenders from time to time such other documentation, consents, authorizations
and approvals in form and substance reasonably satisfactory to the Agent, as
the Agent shall deem reasonably necessary or advisable to perfect or maintain
the Liens of the Agent for the benefit of the Lenders.
(d) With respect to each Distribution Agreement relating
to Product produced or acquired after the date hereof, as promptly as
practicable execute and cause each party thereto to duly execute and deliver to
the Agent an original Notice of Assignment and Irrevocable Instructions.
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(e) With respect to each Distribution Agreement relating
to Product on Schedule 3.18(a) or Schedule 3.18(b) (other than Distribution
Agreements giving rise to Eligible Receivables) use commercially reasonable
efforts to execute and cause each party thereto to duly execute and deliver to
the Agent an original Notice of Assignment and Irrevocable Instructions.
SECTION 5.14. Performance of Obligations.
Duly observe and perform all material terms and conditions of
all production services agreements with respect to an item of Product, the
Distribution Agreements, the Completion Guaranty (and all related agreements
with an Approved Completion Guarantor), all agreements that are included in the
chain of title for an item of Product and all other material agreements with
respect to the production, development and/or exploitation of an item of
Product and diligently protect and enforce the rights of any Credit Party under
all such agreements in a manner consistent with prudent business judgment.
SECTION 5.15. Copyright.
(a) In connection with each item of Product, with respect
to which a Credit Party is or becomes the copyright proprietor thereof or to
the extent such interest is obtained by a Credit Party, or a Credit Party
otherwise acquires a copyrightable interest in, take any and all actions
necessary to register the copyright for such item of Product in the name of
such Credit Party in conformity with the laws of the United States, and
immediately deliver to the Agent (i) written evidence of the registration of
any and all such copyrights for inclusion in the Collateral and (ii) a
Copyright Security Agreement Supplement, relating to such item of Product
executed by such Credit Party and all other parties to the Copyright Security
Agreement; provided, that, notwithstanding the foregoing, no such registration
need be made with respect to a script or a screenplay unless either the Credit
Party has invested at least $500,000 in such item of Product or the item of
Product is scheduled to commence principal photography.
(b) As soon as a completed item of Product can be
copyrighted (but in any event no later than 30 days after theatrical release of
such item of Product), to the extent a
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Credit Party is or becomes the copyright proprietor thereof or to the extent
such interest is obtained by a Credit Party, or a Credit Party otherwise
acquires a copyrightable interest in such item of Product, take any and all
actions reasonably necessary, to the extent possible, to register the copyright
for such item of Product (including the underlying literary rights thereto) in
the name of such Credit Party, in conformity with the laws of the United States
and such other jurisdictions as the Agent may reasonably specify, and
immediately deliver to the Agent (i) written evidence of the registration of
any and all such copyrights for inclusion in the Collateral and (ii) a
Copyright Security Agreement Supplement relating to any such item executed by
such Credit Party and all other parties to the Copyright Security Agreement.
(c) Obtain instruments of transfer or other documents
evidencing the interests of the Credit Parties with respect to the copyrights
relating to Product in which the Credit Parties are not entitled to be the
initial copyright proprietor, and promptly record such instruments of transfer
on the United States Copyright Register and, to the extent possible, in such
other jurisdictions as the Agent may reasonably request.
SECTION 5.16. Film Properties and Rights; Credit Parties to
Act as Pledgeholder.
Subject to the rights of third parties, act as pledgeholder
for the Agent on behalf of the Lenders with the same effect as if the Agent for
the benefit of the Lenders were a pledgee in possession of all property
relating to Product which are now or hereafter in the (actual or constructive)
possession of any such Credit Party, subject to such access as shall be
necessary to produce and distribute such Product.
SECTION 5.17. Laboratories; No Removal.
(a) To the extent any Credit Party has control over, or
rights to receive any of the physical elements of, any item of Product, deliver
or cause to be delivered to a Laboratory or Laboratories all negative and
preprint material and all sound track materials with respect to each such item
of Product; notwithstanding the foregoing, with respect to items of Product in
existence on the Closing Date that are (1) not related to
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Eligible Receivables, (2) not included in the calculation of the Library Credit
and (3) not material in the aggregate to the Credit Parties, each Credit Party
shall use reasonable commercial efforts to cause the materials relating to such
items of Product to be delivered to a Laboratory. Prior to requesting any such
Laboratory to deliver such negative or other preprint or sound track material
to another Laboratory, such Credit Party shall provide the Agent with a
Laboratory Access Letter or a Pledgeholder Agreement executed by such other
Laboratory and all the other parties to such Pledgeholder Agreement (other than
the Agent). Each Credit Party hereby agrees not to remove or cause the removal
of the original negative and film or sound materials with respect to any item
of Product owned by such Credit Party or in which such Credit Party has an
interest (i) to a location outside the United States, other than the United
Kingdom or Canada or (ii) to any state where UCC-1 financing statements (or in
the case of jurisdictions outside the United States, documents similar in
purpose and effect) have not been filed against such Credit Party holding any
rights to such item of Product.
(b) During production of any item of Product produced by
a Credit Party, promptly deliver the exposed negative for such item of Product
to the appropriate Laboratory on a daily basis.
SECTION 5.18. Lab Access Letter.
Deliver to the Agent two fully executed copies of a Laboratory
Access Letter with respect to each item of Product, if any, for which such
Credit Party has rights of access to the physical elements of such item of
Product, but does not own such physical elements; notwithstanding the
foregoing, with respect to items of Product in existence on the Closing Date
that are (1) not related to Eligible Receivables, (2) not included in the
calculation of the Library Credit and (3) not material in the aggregate to the
Credit Parties, each Credit Party shall use reasonable commercial efforts to
deliver any such Laboratory Access Letters.
SECTION 5.19. Cash Receipts.
In the event the Borrower receives (i) payment or payments
from any account debtor or obligor in excess of $10,000, which payment should
have been deposited in a Collection Account
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or (ii) the proceeds of any sale of Collateral in excess of $10,000, the
Borrower shall promptly remit such payment or proceeds to the Agent to be
applied in accordance with Section 2.12(e) and Section 8.3.
SECTION 5.20. Subsidiaries.
Cause each (i) corporation which becomes a Subsidiary of the
Borrower after the Closing Date and (ii) Inactive Subsidiary which becomes
active after the Closing Date to deliver to the Agent as promptly as
practicable an Instrument of Assumption and Joinder duly executed by such
Subsidiary, appropriate UCC-1 financing statements executed by such Subsidiary
and to the extent the stock of such Subsidiary has not previously been pledged
to the Agent, a Pledge Agreement Supplement duly executed by the Borrower
accompanied by the stock certificates of such Subsidiary together with undated
stock powers executed in blank.
SECTION 5.21. Security Agreements with the Guilds.
Furnish to the Agent duly executed copies of (i) each security
agreement relating to an item of Product entered into by a Credit Party with
any guild after the Closing Date and (ii) a subordination agreement from the
applicable guild with respect to the security interest and other rights granted
to it pursuant to each such security agreement delivered to the Agent pursuant
to clause (i) above. Each such subordination agreement shall be in the form
customarily entered into by the Agent and the applicable guild or in such other
form as may be acceptable to the Agent.
SECTION 5.22. Bank Accounts.
Provide the Agent with a list of all bank accounts maintained
by any Credit Party.
SECTION 5.23. Liens.
Defend the Collateral and the Pledged Securities against any
and all Liens, claims and other impediments howsoever arising, other than
Permitted Encumbrances.
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SECTION 5.24. Production.
Use its reasonable commercial efforts to cause any item of
Product being produced by any Credit Party or, in which any Credit Party has an
Investment of at least $250,000 to be produced in accordance with the standards
set forth in, and within the time period established in, all acquisition and
license agreements with respect to such item of Product to which a Credit Party
is a party.
SECTION 5.25. Music.
When an item of Product has been scored, if requested by the
Agent, deliver to the Agent (a) written evidence of the music synchronization
rights obtained from the composer or the licensor of the music and (b) copies
of all music cue sheets with respect to such item of Product.
SECTION 5.26. Distribution Agreements; Negative Pickups; etc.
(a) Furnish to the Agent promptly upon receipt thereof
copies of all Negative Pickup agreements and all agreements relating to joint
ventures or co-productions which are entered into by a Credit Party and the
originals of all Acceptable L/C's (including any amendments thereto) which are
received by a Credit Party (whether pursuant to a Distribution Agreement or
otherwise) after the date hereof.
(b) Furnish to the Agent, concurrently with the delivery
of each Borrowing Base Certificate, a list in the form of Schedule 3.14 hereto
of all material Distribution Agreements and amendments to Distribution
Agreements that were previously delivered to the Agent or included on any such
list or included on Schedule 3.14 executed during the preceding month.
(c) From time to time (i) furnish to the Agent such
information and reports regarding the Distribution Agreements to which a Credit
Party is a party as the Agent may reasonably request and (ii) upon the
occurrence and continuation of an Event of Default and the reasonable request
of the Agent, make to the other parties to a Distribution Agreement to which a
Credit Party is a party such demands and requests for information and reports
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or for action as the Credit Party is entitled to make under each such
Distribution Agreement.
(d) Take all action on its part to be performed necessary
to effect timely payments under all Acceptable L/C's, including, without
limitation, timely preparation, acquisition and presentation of all documents,
drafts or other instruments required to effect payment thereunder.
(e) In the case of each item of Product which is to be
acquired pursuant to a Negative Pickup arrangement, furnish to the Agent copies
of all instruments of transfer or other instruments (in recordable form)
("Chain of Title Documents") necessary to establish that the producer who is
party to such Negative Pickup agreement owns sufficient copyright rights in the
literary property upon which such item of Product is to be based to enable such
producer to produce such item of Product and to grant to the Credit Party all
rights being acquired pursuant to such Negative Pickup agreement. The Borrower
will deliver such Chain of Title Documents to the Agent five (5) days prior to
the expiration of any right to withhold payment of the minimum guaranty under
such Negative Pickup agreement on the basis of a defect in the chain of title
for such item of Product but no later than the first inclusion of such item of
Product in the Borrowing Base.
SECTION 5.27. Separate Corporate Structures.
(a) Not permit all of the officers and directors of the
Parent and/or the Parent's other Subsidiaries to be officers or directors of
the Borrower (or any of its Subsidiaries).
(b) Cause, if any of the Borrower's Affiliates (other
than its Subsidiaries) have directors and/or officers in common with the Parent
and/or the Parent's other Subsidiaries, and if the Borrower and its
Subsidiaries share the same employees with the Parent and/or the Parent's other
Subsidiaries, the salaries and expenses related to providing benefits to such
officers, directors and employees to be fairly and nonarbitrarily allocated
among such entities, with the result that each such entity bears its fair share
of the salary and benefit costs associated with all such common officers,
directors and employees.
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(c) Cause, if the Borrower (or its Subsidiaries) and the
Parent and/or the Parent's other Subsidiaries jointly contract to do business
with vendors or service providers, the costs incurred in so doing to be fairly
and nonarbitrarily allocated among such entities, with the result that each
such entity bears its fair share of such costs.
(d) Cause, if the Borrower (or any of its Subsidiaries)
and the Parent and/or the Parent's other Subsidiaries have offices in the same
location, the overhead expenses to be fairly and nonarbitrarily allocated among
such entities, with the result that each bears its fair share of such overhead
expenses.
(e) Cause the Borrower and each of its Subsidiaries to
maintain checking accounts with commercial banking institutions which are
separate from those of the Parent and/or the Parent's other Subsidiaries.
(f) Conduct its affairs strictly in accordance with its
Certificate of Incorporation and By-Laws and to observe all necessary,
appropriate, and customary corporate and other organizational formalities,
including, but not limited to, keeping separate and accurate minutes of
meetings of its board of directors and shareholders passing all resolutions or
consents necessary to authorize actions to be taken, and maintaining accurate
and separate books, records and accounts and in a manner permitting its assets
and liabilities to be easily separated and readily ascertained.
(g) Cause each of the Borrower (and its Subsidiaries) and
the Parent and/or the Parent's other Subsidiaries not to hold itself out to the
public or to any of its individual creditors as being a unified entity with
common assets and liabilities with the other.
(h) Cause each of Borrower's and its Subsidiaries'
operations to be conducted without an intent to hinder, delay or defraud any
creditors in connection with its respective assets and operations.
(i) Not permit the Borrower to amend Section 11 of its
Certificate of Incorporation.
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SECTION 5.28. Environmental Laws.
(a) Promptly notify the Agent upon any Credit Party
becoming aware of any violation or potential violation or noncompliance with,
or liability or potential liability under any Environmental Laws which, when
taken together with all other pending violations, would reasonably be expected
to have a Material Adverse Effect on the Credit Parties, taken as a whole, and
promptly furnish to the Agent all notices of any nature which any Credit Party
may receive from any Governmental Authority or other Person with respect to any
violation, or potential violation or non-compliance with, or liability or
potential liability under any Environmental Laws which, in any case or when
taken together with all such other notices, could reasonably be expected to
have a Material Adverse Effect on the Credit Parties, taken as a whole.
(b) Comply with and use reasonable efforts to ensure
compliance by all tenants and subtenants with all Environmental Laws, and
obtain and comply in all material respects with and maintain, and use best
efforts to ensure that all tenants and subtenants obtain and comply in all
material respects with and maintain, any and all licenses, approvals,
registrations or permits required by Environmental Laws.
(c) Conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required
under all Environmental Laws and promptly comply in all material respects with
all lawful orders and directives of all Governmental Authorities.
(d) Defend, indemnify and hold harmless the Agent and the
Lenders, and their respective employees, agents, trustees, officers and
directors, from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind of nature, known or
unknown, contingent or otherwise, arising out of, or in any way related to the
violation of or non-compliance by any Credit Party with any Environmental Laws,
or any orders, requirements or demands of Governmental Authorities related
thereto, including, without limitation, reasonable attorney and consultant
fees, investigation and laboratory fees, court costs and litigation
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expenses, but excluding therefrom all claims, demands, penalties, arising out
of or resulting from (i) the gross negligence or willful misconduct of such
indemnified party or (ii) any acts or omissions of any indemnified party
occurring after such indemnified party is in possession of, or controls the
operation of, any property or asset.
6. NEGATIVE COVENANTS
Each of the Credit Parties covenants and agrees that from the
date hereof and until (i) the payment in full of (x) the Commitment Fees
payable hereunder and (y) the principal of and interest on the Notes, (ii) the
satisfaction of all other Obligations, (iii) the termination of the Commitments
(including any commitment to issue any Letter of Credit), (iv) the expiration,
termination or cancellation of all Letters of Credit and (v) the termination of
this Agreement, unless the Required Lenders shall otherwise consent in writing,
each of them will not, directly or indirectly:
SECTION 6.1. Limitation on Indebtedness.
Incur, create, assume or suffer to exist any Indebtedness
except:
(a) Indebtedness represented by the Notes and the other
Obligations;
(b) Indebtedness in existence on the date hereof which is
listed on Schedule 6.1, but not any increases, extensions or renewals thereof,
except for extensions or renewals on substantially the same terms;
(c) liabilities relating to participations, deferments, guild
residuals and similar payments payable in connection with the production of
Product;
(d) Guaranties permitted under Section 6.2;
(e) liabilities for acquisitions of rights or Product
incurred in the ordinary course of business and not otherwise prohibited
hereunder;
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(f) Indebtedness owed to a Credit Party by another Credit
Party; provided that (i) such Indebtedness is subordinated to the Obligations
and (ii) each such Credit Party is organized under the laws of a state in the
United States;
(g) Subordinated Indebtedness;
(h) Indebtedness in respect of Negative Pickup
transactions of up to $5,000,000 per item of Product, except that two items of
Product per fiscal year may be up to $7,000,000 per item of Product for all
items of Product produced or acquired during that year, which are otherwise
permitted hereunder; and
(i) purchase money Indebtedness (including Capital
Leases), to the extent secured by a Lien permitted by Section 6.6(h), not in
excess of $2,000,000 outstanding at any one time.
SECTION 6.2. Limitation on Guaranties.
Provide any Guaranty, either directly or indirectly, except:
(a) obligations with respect to investments in Product
(whether pursuant to a Negative Pickup or otherwise) to the extent otherwise
permitted hereunder;
(b) Guaranties of performance under guild agreements, or to
suppliers or Laboratories providing services in connection with the production
of Product, which are incurred in the ordinary course of business;
(c) Guaranties by the Borrower of performance obligations of
a Corporate Guarantor incurred in the ordinary course of business; and
(d) Endorsements of negotiable instruments for deposit or
collection in the ordinary course of business.
SECTION 6.3. No Change in Business.
Engage in any business activities other than activities
relating to the development, production, acquisition, exploitation and
worldwide distribution of Product (other than
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the production of newly created deficit-financed made-for-television
programming), in each case, including the ancillary rights therein, financial
consulting and video duplication and post-production.
SECTION 6.4. Consolidation, Merger, Sale or Purchase of
Assets, etc.
Whether in one transaction or a series of transactions, wind
up, liquidate or dissolve its affairs, or enter into any transaction of merger
or consolidation, or sell or otherwise dispose of all or substantially all of
its property, stock or assets or agree to do or suffer any of the foregoing
except that a Corporate Guarantor may merge with and into (i) the Borrower or
(ii) another Corporate Guarantor.
SECTION 6.5. Limitation on Loans and Investments.
Create, make or incur any non-Product-related Investment, loan
or advance except:
(a) Investments in Cash Equivalents, provided such securities
are deposited with the Agent to be held as Collateral;
(b) loans to a Credit Party to the extent permitted by and as
described in Section 6.1(f); and
(c) Investments existing on the Closing Date as set forth on
Schedule 3.17(a).
SECTION 6.6. Limitation On Liens.
Create, incur, assume or cause to exist any Lien upon any
asset or revenue stream except:
(a) Liens pursuant to written security agreements in favor of
guilds which are required pursuant to the terms of collective bargaining
agreements on terms satisfactory to the Agent;
(b) deposits under workers' compensation, unemployment
insurance and Social Security laws or to secure statutory obligations or bonds
incurred in the ordinary course of business;
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(c) Liens for taxes, assessments or other governmental
charges or levies due and payable, the validity or amount of which is currently
being contested in good faith by appropriate proceedings pursuant to the terms
of Section 5.5 hereof;
(d) Liens on assets of the Credit Parties existing as of
the date hereof described in Schedule 6.6;
(e) possessory Liens incurred in the ordinary course of
business (including Liens in favor of Laboratories, landlords, mechanics,
carriers, warehousemen and suppliers of materials and equipment) which secure
normal trade debt not yet due and payable and do not secure obligations for
borrowed money; provided that the aggregate amount of such secured trade
payables which remain outstanding more than 60 days after creation shall not
exceed $1,000,000;
(f) Liens or rights in connection with an item of Product
granted to an Approved Completion Guarantor for such item of Product, which
Liens or grants of rights are in form and substance customary for the industry
or otherwise acceptable to the Agent;
(g) Liens pursuant to this Agreement and the other
Fundamental Documents;
(h) purchase money Liens granted to the vendor or Person
financing the acquisition of property, plant or equipment if (i) limited to the
specific assets acquired and, in the case of tangible assets, other property
which is an improvement to or is acquired for specific use in connection with
such acquired property or which is real property being improved by such
acquired property; (ii) the debt secured by the Lien is the unpaid balance of
the acquisition cost of the specific assets on which the Lien is granted; and
(iii) such transaction does not otherwise violate this Agreement;
(i) Liens securing certain Subordinated Indebtedness made by
any of the Metromedia Holders which Indebtedness and Liens are subordinated
pursuant to a Subordination Agreement;
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(j) Liens arising out of attachments, judgments or awards as
to which an appeal or other appropriate proceedings for contest or review are
promptly commenced (and as to which foreclosure and other enforcement
proceedings (i) shall not have been commenced (unless fully bonded or otherwise
effectively stayed) or (ii) in any event shall be promptly fully bonded or
otherwise effectively stayed);
(k) Liens granted to producers in connection with the
acquisition of Product provided that such Liens do not extend to any item of
Product other than the item of Product being acquired and the parties have
entered into an intercreditor agreement with the Agent satisfactory in form and
substance to the Agent; and
(l) protective Liens granted to licensees under Distribution
Agreements provided such Liens solely secure the distribution rights granted to
the licensee pursuant to such Distribution Agreement.
SECTION 6.7. Restricted Payments.
Pay, declare or become obligated to make any Restricted
Payments except Restricted Payments to the Borrower.
SECTION 6.8. Limitation on Leases.
Create, incur or assume Consolidated lease expense for all
Credit Parties for (i) fiscal years 1995 and 1996 in excess of $2,500,000 and
(ii) each fiscal year thereafter in excess of the amount permitted for the
immediately preceding fiscal year plus 5% of such amount (but specifically
excluding amounts expended to create, acquire or distribute an item of
Product).
SECTION 6.9. Receivables.
Sell, discount or otherwise dispose of notes, accounts
receivable or other obligations owing to a Credit Party except for the purpose
of collection in the ordinary course of business.
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SECTION 6.10. Sale and Leaseback.
Enter into any arrangement with any Person or Persons other
than a Credit Party, whereby in contemporaneous transactions a Credit Party
sells essentially all of its right, title and interest in an item of Product
and such Credit Party or another Credit Party acquires or licenses the right to
distribute or exploit such item of Product in media and markets accounting for
substantially all the value of such item of Product.
SECTION 6.11. ERISA Compliance.
The Borrower shall not, directly or indirectly, nor permit any
member of the Controlled Group, directly or indirectly, to (i) engage in a
"prohibited transaction" as defined in Section 4975 of the Code or Section 406
of ERISA which could reasonably be expected to subject the Borrower or such
member of the Controlled Group (after giving effect to any statutory and/or
regulatory exemption), to the tax on prohibited transactions imposed by Section
4975 of the Code or any other liability; (ii) terminate any Plan subject to
Title IV of ERISA; (iii) make a complete or partial withdrawal (within the
meaning of Section 4201 of ERISA) from any Multiemployer Plan so as to result
in any liability to the Borrower or any member of the Controlled Group; (iv)
enter into any new Plan or modify any existing Plan or engage in any other
action which would increase the Borrower's or any member of the Controlled
Group's obligations under any Plan; (v) enter any new Welfare Plan or modify
any existing Welfare Plan to provide for continuing health benefits or coverage
for any participant or any beneficiary of a participant after such
participant's termination of employment, except as may be required by Section
4980B of the Code or Sections 601 through 608 of ERISA; (vi) fail to make
required contributions to any Plan, Welfare Plan or Multiemployer Plan; (vii)
permit the present value of all accrued benefits under each Plan (using the
actuarial assumptions utilized by the PBGC upon termination of a plan) to
exceed the fair market value of Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for each such Plan; (viii)
breach or permit any employee, officer, or director of the Borrower or any
member of the Controlled Group or any trustee or administrator of any Plan or
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Welfare Plan to breach any fiduciary responsibility imposed under Title I of
ERISA with respect to any Plan or Welfare Plan; or (ix) engage or allow any
member of the Controlled Group to engage in any transaction which would result
in the incurrence of a liability under Section 4069 of ERISA.
SECTION 6.12. Transactions with Affiliates.
Directly or indirectly enter into any transaction with an
Affiliate (other than a Credit Party) unless such transaction (i) is on an
arm's-length basis, (ii) occurs in the ordinary course of business or (iii) is
approved by the Agent.
SECTION 6.13. Hazardous Materials.
Cause or permit any of its properties or assets to be used to
generate, manufacture, refine, transport, treat, store, handle, dispose,
transfer, produce or process Hazardous Materials, except in compliance in all
material respects with all applicable Environmental Laws, nor release,
discharge, dispose of or permit or suffer any release or disposal as a result
of any intentional act or omission on its part of Hazardous Material onto any
such property or asset in material violation of any Environmental Law.
SECTION 6.14. Use of Proceeds of Loans and Requests for
Letters of Credit.
Use the proceeds of Loans or request any Letter of Credit
hereunder other than for the purposes set forth in, and as required by, Section
5.8.
SECTION 6.15. Budgeted Negative Cost; etc.
Incur any obligation in connection with any item of Product
produced by a Credit Party with a Budgeted Negative Cost in excess of
$5,000,000, execute a Negative Pickup obligating the Borrower to pay a minimum
guarantee of more than $5,000,000 for any item of Product, incur acquisition
costs of more than $5,000,000 for any item of Product, except that in any
fiscal year up to two items of Product may be up to $7,000,000 per item of
Product.
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SECTION 6.16. Unrecouped Print and Advertising Expenses.
Permit Unrecouped Print and Advertising Expenses in the
aggregate to exceed $6,000,000 at any time.
SECTION 6.17. Development Costs.
Permit development costs to exceed $3,000,000 in the aggregate
at any time or to exceed $500,000 per item of Product for which Active
Preproduction has not yet commenced which, in either case, have neither been
written off or capitalized as part of the cost of production of the item of
Product.
SECTION 6.18. Principal Photography.
For theatrical items of Product where a Credit Party is
responsible for the management of the production, permit more than five items
of Product to be in Active Preproduction and not Completed at any one time and
permit more than three such items of Product to be in principal photography at
any one time.
SECTION 6.19. Joint Venture; Co-Production.
Enter into any joint venture agreement or co-production
agreement without the Agent's prior consent.
SECTION 6.20. Free Cash Flow Ratio.
The ratio of Free Cash Flow to Cumulative Film Investment
shall never be less than:
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Period Ratio
------ -----
for the four quarters
commencing with quarter
ending 12/31/96 through
12/30/97 positive
for the four quarters
commencing with quarter
ending 12/31/97 through
12/30/98 .45: 1
for the four quarters
commencing with quarter
ending 12/31/98 through
12/30/99 .65: 1
for the four quarters
commencing with quarter
ended 12/31/99 through
12/30/00 .70: 1
for the quarter ended
12/31/00 1: 1
SECTION 6.21. Limitations on Capital Expenditures.
Make or incur any obligation to make Capital Expenditures for
any fiscal year in excess of $2,000,000 (but specifically excluding amounts
expended to create, acquire or distribute an item of Product and the aggregate
of all expenditures properly capitalized in accordance with GAAP by a Person to
acquire, by purchase or otherwise, the business, property or fixed assets of,
or stock, or other evidence of beneficial ownership, in part or in whole, of
any other Person other than the portion of such expenditure allocable, in
accordance with GAAP, to net current assets).
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SECTION 6.22. Cumulative Film Investment.
At the end of each fiscal quarter, the Cumulative Film
Investment shall not exceed Free Cash Flow by more than $50,000,000.
SECTION 6.23. Limitations on Net Loss.
The Net Loss shall never be greater than:
Period Amount
------ ------
fiscal year
1996 $22,500,000
fiscal year
1997 10,500,000
fiscal year
1998 8,000,000
fiscal year
1999 5,000,000
fiscal year
2000 0
SECTION 6.24. Overhead Expenses.
Permit aggregate cash overhead expenses for any fiscal year to
be more than $20,000,000.
SECTION 6.25. Fiscal Year.
Change its fiscal year end to other than December 31.
SECTION 6.26. Special Purpose Distributors.
Enter into any transaction with any Person where such
Person(s) effectively acts as a distributor or intermediary for the
exploitation of Product in one or more territories in an arrangement whereby it
is intended that payments under Distribution Agreements entered into by such
Person with third
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parties will be included in the Borrowing Base (provided such payments
constitute Eligible Receivables) unless such transaction as well as the
proposed Person who will effectively act as a distributor or intermediary, have
been approved in writing by the Agent. Each Credit Party agrees that it will
enter into, and require each Special Purpose Distributor to enter into, such
Distributor Security Documents as the Agent may request, which shall among
other things assign to the Agent (for the benefit of the Lenders) the security
interest and other rights that it receives from each Special Purpose
Distributor pursuant to a film lease agreement, a security agreement or
otherwise.
SECTION 6.27. Interest Rate Protection Agreements, etc.
Enter into any Interest Rate Protection Agreement or Currency
Agreement for other than bona fide hedging purposes.
7. EVENTS OF DEFAULT
SECTION 7.1. Term Loan Events of Default.
In the case of the happening and during the continuance of any
of the following events (herein called "Term Loan Events of Default"):
(a) any representation or warranty made by a Credit Party
in this Agreement or any other Fundamental Document to which it is a party or
any statement or representation made in any report, financial statement,
certificate or other document furnished directly to the Agent or any Lender
pursuant to this Agreement or any other Fundamental Document, shall prove to
have been false or misleading (considered in the context of all other
information provided to the Lenders) in any material respect when made or
delivered;
(b) default shall be made in the payment of principal of
the Notes as and when due and payable, whether by reason of maturity, mandatory
prepayment, acceleration or otherwise;
(c) default shall be made in the payment of interest on
the Notes, Commitment Fees or other amounts payable to the Agent or a Lender
under this Agreement, under any Currency
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Agreement, under any Interest Rate Protection Agreement or under the Fee
Letter, when and as the same shall become due and payable, whether at the due
date thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise and such default shall continue unremedied for five (5)
days;
(d) default shall be made in the due observance or
performance of any covenant, condition or agreement contained in Section 5.1(i)
(with respect to notice of Defaults or Events of Default), Section 5.8 or
Article 6 of this Agreement;
(e) default shall be made in the due observance or
performance of any other covenant, condition or agreement to be observed or
performed pursuant to the terms of this Agreement or any other Fundamental
Document or by any Credit Party in the due observance or performance of any
other covenant, condition or agreement to be observed or performed pursuant to
the terms of any Fundamental Document to which such Credit Party is a party and
such default shall continue unremedied for twenty (20) days after the Borrower
receives written notice or actual knowledge thereof;
(f) default in payment shall be made with respect to any
Indebtedness (other than the Obligations) of the Borrower or any of its
Subsidiaries in an amount or amounts over $1,000,000 in the aggregate; or other
default in connection with any such Indebtedness, if the effect of such other
default is to accelerate following any applicable grace periods or to permit
the holder thereof to accelerate the maturity of such Indebtedness or to permit
the holder thereof to cause such Indebtedness to become due prior to its stated
maturity following any applicable grace periods, and such default shall not be
remedied, cured, waived or consented to within the period of grace with respect
thereto; or any such Indebtedness shall not be paid when due;
(g) the Borrower or any of its Subsidiaries (other than
the Inactive Subsidiaries) shall generally not pay its debts as they become due
or shall admit in writing its inability to pay its debts, or shall make a
general assignment for the benefit of creditors; or the Borrower or any of its
Subsidiaries shall commence any case, proceeding or other action seeking to
have an order for relief entered on its behalf as a debtor or to
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adjudicate it a bankrupt or insolvent or seeking reorganization, arrangement,
adjustment, liquidation, dissolution or composition of it or its debts under
any law relating to bankruptcy, insolvency, reorganization or relief of debtors
or seeking appointment of a receiver, trustee, custodian or other similar
official for it or for all or any substantial part of its property or shall
file an answer or other pleading in any such case, proceeding or other action
admitting the material allegations of any petition, complaint or similar
pleading filed against it or consenting to the relief sought therein; or the
Borrower or any of its Subsidiaries shall take any action to authorize any of
the foregoing;
(h) any involuntary case, proceeding or other action
against the Borrower or any of its Subsidiaries (other than the Inactive
Subsidiaries) shall be commenced seeking to have an order for relief entered
against it as debtor or to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or seeking appointment of a
receiver, trustee, custodian or other similar official for it or for all or any
substantial part of its property, and such case, proceeding or other action (i)
results in the entry of any order for relief against it or (ii) shall remain
undismissed for a period of ninety (90) days;
(i) final judgment(s) for the payment of money in excess
of $1,000,000 shall be rendered against the Borrower or any of its Subsidiaries
and within thirty (30) days from the entry of such judgment shall not have been
discharged or stayed pending appeal or shall not have been discharged within
thirty (30) days from the entry of a final order of affirmance on appeal;
(j) a Reportable Event relating to a failure to meet
minimum funding standards or an inability to pay benefits when due shall have
occurred with respect to any Plan under the control of the Borrower or any of
its Subsidiaries shall not have been remedied within thirty (30) days after the
occurrence of such Reportable Event; or a trustee shall be appointed by a
United States District Court to administer such Plan, or the Pension Benefits
Guaranty Corporation shall institute proceedings
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to terminate such Plan and the Agent shall have notified the Borrower that the
Required Lenders have made a determination that on the basis of such Reportable
Event, appointment of trustee or commencement of proceedings, there are
reasonable grounds to believe that such occurrence would have a Material
Adverse Effect;
(k) the Pledge Agreements, this Agreement, the Copyright
Security Agreement, any Copyright Security Agreement Supplement (each a
"Security Document") shall, for any reason, not be or shall cease to be in full
force and effect or shall be declared null and void or any of the Security
Documents shall not give or shall cease to give the Agent the Liens, rights,
powers and privileges purported to be created thereby in favor of the Agent for
the benefit of the Lenders, superior to and prior to the rights of all third
Persons and subject to no other Liens (other than Permitted Encumbrances), or
the validity or enforceability of the Liens granted, to be granted, or
purported to be granted, by any of the Security Documents shall be contested by
any Credit Party or any of its Affiliates, provided that no such defect in the
Security Documents shall give rise to an Event of Default under this paragraph
(k) unless such defect or such failure shall affect Collateral that is or
should be subject to a Lien in favor of the Agent having an aggregate value in
excess of $1,000,000;
(l) failure to submit any Borrowing Base Certificate to
the Agent within ten (10) Business Days of the date such certificate was due
pursuant to the terms of this Agreement if at such time any Term Loans are
currently outstanding;
(m) a Revolving Loan Event of Default shall have occurred;
(n) a Change in Management shall occur; for purposes
hereof, a "Change in Management" shall mean that any one of Existing Management
shall cease to be performing his or her current duties for the Borrower and an
acceptable successor has not been replaced within one hundred twenty (120) days
of such discontinuance (a successor shall be deemed acceptable if not objected
to by the Required Lenders within 5 days of notice of the replacement);
"Existing Management" shall mean the Persons performing the functions of chief
executive officer, chief
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financial officer, general counsel and head of production for the Borrower as
of the Closing Date and any acceptable (determined as set forth above)
successor to such Person;
(o) any of the Metromedia Holders shall have disaffirmed
in writing their respective obligations under the Subordination Agreement or a
court of competent jurisdiction shall determine that the Subordination
Agreement is void or voidable;
then, in every such event and at any time thereafter during the continuance of
such event, the Agent may, or if directed by the Required Lenders shall, take
any or all of the following actions, at the same or different times: declare
the principal of and the interest on the Term Loans and the Term Notes or
thereunder to be forthwith due and payable, whereupon the same shall become and
be forthwith due and payable, without presentment, demand, protest, notice of
acceleration or other notice of any kind, all of which are hereby expressly
waived, anything in this Agreement or in the Term Notes to the contrary
notwithstanding. If a Term Loan Event of Default specified in paragraph (g) or
(h) above shall have occurred, the principal of, and interest on, the Loans and
the Notes and all other amounts payable hereunder and thereunder automatically
become due and payable without presentment, demand, protest, or other notice of
any kind, all of which are hereby expressly waived, anything in this Agreement
or the Term Notes to the contrary notwithstanding. Such remedies shall be in
addition to any other remedy available to the Lenders pursuant to Applicable
Law or otherwise.
SECTION 7.2. Revolving Loan Events of Default.
In the case of the happening and during the continuance of any
of the following events (herein called "Revolving Loan Events of Default"):
(a) default shall be made in the payment of principal of
the Notes as and when due and payable, whether by reason of maturity, mandatory
prepayment, acceleration or otherwise;
(b) default shall be made in the payment of interest on
the Notes, Commitment Fees or other amounts payable to the Agent or a Lender
under this Agreement, under any Currency
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Agreement, under any Interest Rate Protection Agreement or under the Fee
Letter, when and as the same shall become due and payable, whether at the due
date thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise and such default shall continue unremedied for five (5)
days;
(c) the Guaranty Agreement shall for any reason, not be
or shall cease to be in full force and effect, or shall be declared null and
void, or becomes unenforceable, or it shall be terminated, or disaffirmed by
any Guarantor thereunder;
(d) a Change in Control shall occur; for purposes hereof,
a "Change in Control" shall mean (x) a change of ownership of the Borrower
which results in its not being wholly-owned by the Parent, (y) a change of
ownership of the Parent which results in (1) the Metromedia Holders not having
beneficial ownership or common voting power of at least 25% of the common
voting power of the Parent, (2) any "person" (as such term is defined in 13(d)
and 14(d) of the Securities and Exchange Act of 1934) having more common voting
power than the Metromedia Holders or (3) any person other than the Metromedia
Holders for any reason obtaining the right to appoint a majority of the Board
of Directors;
(e) an Estate Default shall occur; for purposes hereof an
"Estate Default" shall mean (a) a failure by the estate of any of ▇▇▇▇ ▇. ▇▇▇▇▇
or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, within ninety (90) days of the death of such individual,
or a failure by a conservator, committee or guardian (a "conservator") for the
assets of such individual within ninety (90) days of the appointment of any
such conservator, (1) to duly allow and assume, or otherwise confirm, a
creditor's claim filed against the estate or the conservator in accordance with
applicable law relating to the obligations of such individual under the
Guaranty (which, in the case of the death of such individual, shall, if
required by applicable law, be evidenced by a creditor's claim filed against
the estate in accordance with applicable law) and (2) to agree for the benefit
of the Lenders and the Agent to maintain (unless the Agent is furnished with
cash collateral, a letter of credit or other collateral acceptable to the Agent
in an amount equal to the lesser of (x) such estate's maximum exposure under
the Guaranty or (y) $35,000,000 in the case of the estate of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
and in the case of ▇▇▇▇ ▇. ▇▇▇▇▇ such estate's maximum exposure
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under the Guaranty) the net worth of the estate (disregarding the separate
status of the Borrower) of: (A) in the case of ▇▇▇▇ ▇. ▇▇▇▇▇ at least
$1,000,000,000 and (B) in the case of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ at least $35,000,000 and
not to make any beneficial distribution from the estate that would cause its
net worth to be less than such amount and (3) to provide a suitable legal
opinion regarding such allowance and assumption or confirmation and such
agreement or (b) any rejection, or attempt at rejection, by the estate of any
such individual or a conservator for his assets of his obligations under the
Guaranty or the taking of any action or the filing of any motion by such estate
or conservator that could reasonably be expected to materially adversely affect
or impede the enforceability of such obligation;
then, in every such event and at any time thereafter during the continuance of
such event, the Agent may, or if directed by the Required Lenders shall, take
any or all of the following actions, at the same or different times: (x)
terminate forthwith the Commitments and/or (y) declare the principal of and the
interest on the Loans and the Notes and all other amounts payable hereunder or
thereunder to be forthwith due and payable, whereupon the same shall become and
be forthwith due and payable, without presentment, demand, protest, notice of
acceleration or other notice of any kind, all of which are hereby expressly
waived, anything in this Agreement or in the Notes to the contrary
notwithstanding.
8. SECURITY
SECTION 8.1. Security Interest.
As security for the due and punctual payment of the
Obligations (including post-petition interest, to the extent permitted by
Applicable Law), each of the Credit Parties hereby mortgages, pledges, assigns,
transfers, sets over, conveys and delivers to the Agent for the benefit of the
Lenders and grants to the Agent for the benefit of the Lenders a security
interest in all of its right, title and interest in and to the Collateral.
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SECTION 8.2. Use of Collateral.
So long as no Event of Default shall have occurred and be
continuing, and subject always to the various provisions of this Agreement and
the other Fundamental Documents, each of the Credit Parties may use the
Collateral in any lawful manner permitted hereunder.
SECTION 8.3. Collection Accounts.
(a) On or before the Closing Date, the Borrower will
establish the Collection Accounts and execute and deliver a Collection Letter
with respect to each such Collection Account established with a Collection
Bank.
(b) The Credit Parties shall direct all Persons who
become licensees, buyers or account debtors under receivables with respect to
any item of Product included in the Collateral to be notified of the assignment
to the Agent (on behalf of the Lenders) of the proceeds of each Distribution
Agreement, and cause each Acceptable L/C to provide that payment thereunder
shall be made directly to a Collection Account.
(c) The Credit Parties will execute documentation
(including, without limitation, Notices of Assignment and Irrevocable
Instructions, assignment agreements, and other documentation) as may now or
hereafter be required by the Agent in order to reflect the security interest of
the Agent (on behalf of the Lenders) in the proceeds in the Collection
Accounts, to provide for the deposit into a Collection Account of the monies
referred to in Section 8.3(b) and to otherwise effectuate the provisions of
this Section 8.3.
(d) In the event the Borrower receives payment from any
Person or proceeds under an Acceptable L/C, which payment should have been
remitted directly to a Collection Account, the Borrower shall promptly remit
such payment or proceeds to a Collection Account to be applied in accordance
with the terms of this Agreement.
(e) All amounts on deposit in the Collection Accounts
shall be remitted to the Concentration Account to be applied as set forth in
Section 2.12(e); provided that to the extent the
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Borrowing Base Ratio equals or exceeds 0.85:1, the amount on deposit in the
Concentration Account will be available to the Borrower on the last Business
Day of each week and the Borrower may instruct that the Agent transfer such
amounts to the Borrower's operating account or to another account designated by
the Borrower. During any period that the Borrower is in compliance with the
Borrowing Base Ratio, the Agent may reasonably request that the Borrower
deliver a Borrowing Base Certificate.
SECTION 8.4. Credit Parties to Hold in Trust.
Upon the occurrence and during the continuance of an Event of
Default, each Credit Party will, upon receipt by it of any revenue, income,
profits or other sums in which a security interest is granted by this Article
8, payable pursuant to any agreement or otherwise, or of any check, draft,
note, trade acceptance or other instrument evidencing an obligation to pay any
such sum, hold the sum or instrument in trust for the Lenders, and forthwith,
without any notice, demand or other action on the part of the Lenders
whatsoever (all notices, demands, or other actions on the part of the Lenders
being expressly waived), endorse, transfer and deliver any such sums or
instruments or both to the Agent to be applied to the repayment of the
Obligations in accordance with the provisions of Section 8.7 hereof.
SECTION 8.5. Collections.
During the continuance of an Event of Default the Agent may,
in its sole discretion, in its name or in the name of the applicable Credit
Parties or otherwise, demand, sue for, collect or receive any money or property
at any time payable or receivable on account of or in exchange for, or make any
compromise or settlement deemed desirable with respect to, any items comprising
the Collateral, but shall be under no obligation so to do, or the Agent may
extend the time of payment, arrange for payment in installments, or otherwise
modify the payment terms, or release any item of Collateral, without thereby
incurring responsibility to, or discharging or otherwise affecting any
liability of, the Credit Parties. The Agent will not be required to take any
steps to preserve any rights against prior parties to the Collateral. If any
Credit Party fails to
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make any payment or take any action required under this Agreement or the
Borrower fails to make any payment under the Notes, the Agent may make such
payments and take all such actions as the Agent deems necessary to protect the
Lenders' security interests in the Collateral and/or the value thereof, and the
Agent is hereby authorized (without limiting the general nature of the
authority hereinabove conferred) to pay, purchase, contest or compromise any
encumbrances, charges or Liens which in the judgment of the Agent appear to be
equal to, prior to or superior to the security interests of the Lenders in the
Collateral and any encumbrances, charges or Liens not expressly permitted by
this Agreement.
SECTION 8.6. Possession, Sale of Collateral.
During the continuance of an Event of Default, the Agent may
enter upon the premises, or wherever the Collateral may be, and take possession
of the Collateral, and may demand and receive such possession from any Person
who has possession thereof, and the Agent may take such measures as it may deem
necessary or proper for the care or protection thereof, including the right to
remove all or any portion of the Collateral, and with or without taking such
possession may sell or cause to be sold, whenever the Agent shall decide, in
one or more sales or parcels, at such prices as the Agent may deem best, and
for cash or on credit or for future delivery, without assumption of any credit
risk, all or any portion of the Collateral, at any broker's board or at public
or private sale, without demand of performance or notice of intention to sell
or of time or place of sale (except 10 days' written notice to the Credit
Parties of the time and place of such sale or sales and such other notices as
may be required by Applicable Law and cannot be waived), and the Agent or any
other Person may be the purchaser of all or any portion of the Collateral so
sold and thereafter hold the same free (to the fullest extent permitted by
Applicable Law) from any claim or right of whatever kind, including any equity
of redemption, of the Credit Parties, any such
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demand, notice, claim, right or equity being hereby expressly waived and
released to the fullest extent permitted by Applicable Law. At any sale or
sales made pursuant to this Article 8, the Agent may bid for or purchase, free
(to the fullest extent permitted by Applicable Law) from any claim or right of
whatever kind, including any equity of redemption, of any of the Credit
Parties, any such demand, notice, claim, right or equity being hereby expressly
waived and released, any part of or all of the Collateral offered for sale, and
may make any payment on account thereof by using any claim for moneys then due
and payable to the Agent and the Lenders (subject to the provisions of Article
11 hereof) by the Credit Parties hereunder as a credit against the purchase
price. The Agent shall in any such sale make no representations or warranties
with respect to the Collateral or any part thereof, and neither the Agent nor
any Lender shall be chargeable with any of the obligations or liabilities of
any Credit Party. The Credit Parties hereby agree (i) that they will, jointly
and severally, indemnify and hold the Agent and the Lenders harmless from and
against any and all claims with respect to the Collateral asserted before the
taking of actual possession or control of the relevant Collateral by the Agent
pursuant to this Article 8, or arising out of any act of, or omission to act on
the part of, any Person (other than the Agent or Lenders) prior to such taking
of actual possession or control by the Agent, or arising out of any act on the
part of any of the Credit Parties, or their agents before or after the
commencement of such actual possession or control by the Agent; and (ii)
neither the Agent nor any Lender shall have liability or obligation to any of
the Credit Parties arising out of any such claim except for acts of willful
misconduct or gross negligence or not taken in good faith. Subject only to the
lawful rights of third parties, any Laboratory which has possession of any of
the Collateral is hereby constituted and appointed by the Credit Parties as
pledgeholder for the Agent and, upon the occurrence of an Event of Default,
each such pledgeholder is hereby authorized to sell all or any portion of the
Collateral upon the order and direction of the Agent, and each of the Credit
Parties hereby waives any and all claims for damages or otherwise, for any
action taken by such pledgeholder in accordance with the terms of the UCC as
adopted and in effect in New York not otherwise waived hereunder. In any
action hereunder the Agent shall be entitled to the appointment of a receiver
without notice, to take possession of all or any portion of the Collateral and
to exercise such powers as the court shall confer upon the receiver.
Notwithstanding the foregoing, upon the occurrence of an Event of Default and
during the continuation of such Event of Default, the Agent shall be entitled
to apply, without notice to the Credit Parties, any cash or cash items
constituting Collateral in the possession of the Agent to payment of the
Obligations.
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SECTION 8.7. Application of Proceeds.
Upon the occurrence of and during the continuance of an Event
of Default, the balance in the Concentration Account and any other account of
any Credit Party with any Lender, all other income on the Collateral and all
proceeds from any sale of the Collateral pursuant hereto shall be applied first
toward payment of the reasonable costs and expenses incurred by the Agent in
enforcing this Agreement, in realizing on or protecting any Collateral and in
enforcing or collecting any Obligations or any Guaranty thereof, including,
without limitation, the reasonable attorney's fees and expenses incurred by the
Agent, and then to the payment in full of the Obligations as set forth in
Section 11.2(b), provided, however, that the Agent may, with the consent of the
Required Lenders in their discretion, apply funds comprising the Collateral to
pay the cost (i) of completing any item of Product owned in whole or in part by
a Credit Party in any stage of production and (ii) of making delivery under the
Distribution Agreements with respect to such item of Product. Any amounts
remaining after such payment in full shall be remitted to the appropriate
Credit Party or as a court of competent jurisdiction may otherwise direct.
SECTION 8.8. Power of Attorney.
Upon the occurrence and during the continuance of such Event
of Default, (a) each of the Credit Parties does hereby irrevocably make,
constitute and appoint the Agent or any of its officers or designees its true
and lawful attorney-in-fact with full power in the name of the Agent or such
Credit Party to receive, open and dispose of all mail addressed to the Credit
Parties, and to endorse any notes, checks, drafts, money orders or other
evidences of payment relating to the Collateral that may come into the
possession of the Agent, with full power and right to cause each Credit Party's
mail to be transferred to the Agent's own offices or otherwise, and to do any
and all other acts necessary or proper to carry out the intent of this
Agreement and grant the security interests hereunder and under the other
Fundamental Documents, and each of the Credit Parties hereby ratify and confirm
all that the Agent or its substitutes shall properly do by virtue of this
Section; (b) each of the Credit Parties does hereby further irrevocably make,
constitute and appoint the Agent or any of its officers or designees its
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true and lawful attorney-in-fact in the name of the Agent or such Credit Party
(i) to enforce each of such Credit Party's rights under and pursuant to all
agreements with respect to the Collateral, all for the sole benefit of the
Agent for the benefit of the Lenders and to enter into such other agreements as
may be necessary or appropriate in the judgment of the Agent to complete the
production, distribution or exploitation of any item of Product which is
included in the Collateral, (ii) to enter into and perform such agreements as
may be necessary in order to carry out the terms, covenants and conditions of
the Fundamental Documents which are required to be observed or performed by
such Credit Party, (iii) to execute such other and further mortgages, pledges
and assignments of the Collateral, and related instruments or agreements, as
the Agent may reasonably require for the purpose of perfecting, protecting,
maintaining or enforcing the security interest granted to the Agent on behalf
of the Lenders hereunder and under the other Fundamental Documents, and (iv) to
do any and all other things necessary or proper to carry out the intention of
this Agreement and the grant of the security interest hereunder and under the
other Fundamental Documents. The Credit Parties hereby ratify and confirm in
advance all that the Agent as such attorney-in-fact or its substitutes shall
properly do by virtue of this power of attorney. In the event the Agent
exercises the power of attorney granted herein, the Agent shall, concurrently
with such exercise, provide written notice to the Borrower and the Lenders in
accordance with Section 12.1.
SECTION 8.9. Financing Statements and Payment Directions.
So long as the security interests of the Lenders in the
Collateral shall not have terminated pursuant to Section 8.12, each of the
Credit Parties hereby authorizes the Agent to file UCC financing statements and
any amendments thereto or continuations thereof and any other appropriate
security documents or instruments (including, without limitation, Copyright
Security Agreements and Copyright Security Agreement Supplements) and to give
any notices necessary or desirable to perfect the Lien in the Collateral in all
cases with regard to the Collateral without the signature of the Credit Parties
or to execute such items as attorney-in-fact for such Credit Party. In the
event the Agent exercises the power of attorney granted
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herein, the Agent shall, concurrently with such exercise, provide written
notice to the Credit Parties in accordance with Section 12.1. The Credit
Parties further authorize the Agent, so long as an Event of Default shall have
occurred and be continuing, to notify any account debtor that all sums payable
to the Credit Parties relating to the Collateral shall be paid as provided
herein or as otherwise directed by the Agent and to confirm directly with
account debtors the amounts payable by them to a Credit Party with regard to
the Collateral and the terms of all accounts receivable.
SECTION 8.10. Further Assurances.
Upon the request of the Agent, each of the Credit Parties
hereby agrees to duly and promptly execute and deliver, or cause to be duly
executed and delivered, at the cost and expense of the Credit Parties, such
further instruments as may be necessary or proper, in the judgment of the
Agent, to carry out the provisions and purposes of this Article 8, and to do
all things necessary, in the judgment of the Agent, to perfect and preserve the
Liens of the Agent for the benefit of the Lenders hereunder and under the
Fundamental Documents, and in the Collateral or any portion thereof.
SECTION 8.11. Remedies Not Exclusive.
The remedies conferred upon or reserved to the Agent in this
Article 8 are intended to be in addition to, and not in limitation of, any
other remedy or remedies available to the Agent. Without limiting the
generality of the foregoing, the Agent and the Lenders shall have all rights
and remedies of a secured creditor under Article 9 of the UCC or other
Applicable Law.
SECTION 8.12. Termination.
The security interest granted under this Article 8 shall
terminate when all the Obligations (including all amounts owing to any
Guarantor under the Guaranty Agreement pursuant to such Guarantor's rights of
subrogation) shall have been fully paid and performed, the Commitments
(including any commitment to issue any Letter of Credit) shall have terminated
and all Letters of Credit shall have expired or been terminated or cancelled.
At
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such time all rights to the Collateral pledged or assigned by the Credit
Parties shall revert to the Credit Parties. Upon such termination the Agent
will, at the Borrower's expense, execute and deliver to a Credit Party such
documents (in form and substance satisfactory to the Agent) as such Credit
Party shall reasonably request to evidence such termination.
SECTION 8.13. Quiet Enjoyment.
The Lenders acknowledge that their security interest hereunder
is subject to the rights of Quiet Enjoyment of various licensees (which are not
Affiliates of any Credit Party) under license agreements and distributors under
Distribution Agreements, whether existing on the date hereof or hereafter
executed. For the purpose hereof, "Quiet Enjoyment" shall mean in connection
with the rights of licensees under license agreements and distributors under
Distribution Agreements, the Lenders' agreement that their rights under this
Agreement and the Fundamental Documents and in the Collateral are subject to
the rights of such licensees or distributors to distribute, exhibit and/or to
exploit the Product licensed to them, and to receive prints or have access to
preprint material in connection therewith and that even if the Lenders shall
become the owner of the Collateral in case of an Event of Default, the Lenders'
ownership rights shall be subject to the rights of said licensees and
distributors; provided, however, that such licensee or such distributor shall
not be in default under the relevant license or Distribution Agreement and,
provided, further except as set forth above, the Lenders shall not be
responsible for any liability or obligation of any Credit Party under any
license agreement.
SECTION 8.14. Release of Collateral.
Unless a Default or Event of Default shall have occurred and
be continuing, upon request by a Credit Party to the Agent in writing, the
Agent shall release its security interest in any Collateral sold by such Credit
Party in compliance with the terms of this Credit Agreement and the other
Fundamental Documents.
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9. GUARANTY
SECTION 9.1. Guaranty.
(a) Each of the Corporate Guarantors, jointly, severally
and absolutely, unconditionally and irrevocably guarantees to the Agent and the
Lenders the due and punctual payment by, and performance of, the Guaranteed
Obligations (including interest accruing on and after the filing of any
petition in bankruptcy or of reorganization of the obligor whether or not
post-filing interest is allowed in such proceeding). Each of the Corporate
Guarantors further agrees that the Obligations may be extended or renewed, in
whole or in part, without notice or further assent from it (except as may be
otherwise required herein), and it will remain bound upon this Guaranty
notwithstanding any extension or renewal of any Obligation.
(b) Each of the Corporate Guarantors waives presentation
to, demand for payment from and protest to, as the case may be, the Borrower or
any Corporate Guarantor or any other guarantor, and also waives notice of
protest for nonpayment, notice of acceleration and notice of intent to
accelerate. The obligations of the Corporate Guarantors hereunder shall not be
affected by (i) the failure of the Agent or any Lender to assert any claim or
demand or to enforce any right or remedy against the Borrower or any Corporate
Guarantor, or any other guarantor under the provisions of this Agreement or any
other agreement or otherwise; (ii) any extension or renewal of any provision
hereof or thereof; (iii) any rescission, waiver, compromise, acceleration,
amendment or modification of any of the terms or provisions of this Agreement,
the Notes or of any other agreement; (iv) the release, exchange, waiver or
foreclosure of any security held by the Agent (for the benefit of the Lenders)
for the Obligations or any of them; (v) the failure of the Agent or any Lender
to exercise any right or remedy against any other guarantor of the Obligations;
or (vi) the release or substitution of any Corporate Guarantor or any other
guarantor.
(c) Each of the Corporate Guarantors further agrees that
this Guaranty is a continuing guaranty and constitutes a guaranty of
performance and of payment when due and not just of collection, and waives any
right to require that any resort be
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had by the Agent to any security held for payment of the Obligations or to any
balance of any deposit, account or credit on the books of the Agent in favor of
the Borrower, any other Corporate Guarantor or to any other Person.
(d) Each of the Corporate Guarantors hereby expressly
assumes all responsibilities to remain informed of the financial condition of
the Borrower, the Corporate Guarantors and any other guarantors and any
circumstances affecting the Collateral, or the Pledged Securities or the
ability of the Borrower to perform under this Agreement.
(e) Each Corporate Guarantors' Guaranty hereunder shall
not be affected by the genuineness, validity, regularity or enforceability of
the Obligations, the Notes or any other instrument evidencing any Obligations,
or by the existence, validity, enforceability, perfection, or extent of any
collateral therefor or by any other circumstance relating to the Obligations
which might otherwise constitute a defense to this Guaranty. Neither the Agent
nor any Lender makes any representation or warranty in respect to any such
circumstances and nor has any duty or responsibility whatsoever to any
Corporate Guarantor in respect to the management and maintenance of the
Obligations or the Collateral or the Pledged Securities.
SECTION 9.2. No Impairment of Guaranty.
The obligations of the Corporate Guarantors hereunder shall
not be subject to any reduction, limitation, impairment or termination for any
reason, including, without limitation, any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to any defense (other than
payment in full of the Obligations) or set-off, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of the Corporate Guarantors
hereunder shall not be discharged or impaired or otherwise affected by the
failure of the Agent to assert any claim or demand or to enforce any remedy
under this Agreement or any other agreement, by any waiver or modification of
any provision thereof, by any default, failure or delay, willful or otherwise,
in the performance of the Obligations, or by any other act or thing or omission
or delay to do any other
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act or thing which may or might in any manner or to any extent vary the risk of
the Corporate Guarantors or would otherwise operate as a discharge of the
Corporate Guarantors as a matter of law, unless and until the Guaranteed
Obligations are paid in full, the Commitments have terminated and each
outstanding Letter of Credit has expired or otherwise been terminated.
SECTION 9.3. Continuation and Reinstatement, etc.
(a) Each of the Corporate Guarantors further agrees that
its guaranty hereunder shall continue to be effective or be reinstated, as the
case may be, if at any time payment, or any part thereof, of principal of or
interest on or any fees on any Guaranteed Obligation is rescinded or must
otherwise be restored by the Agent upon the bankruptcy or reorganization of the
Borrower or any other Corporate Guarantor, or otherwise. In furtherance of the
provisions of this Article 9, and not in limitation of any other right which
the Agent may have at law or in equity against the Borrower or a Corporate
Guarantor or any other person by virtue hereof, upon failure of the Borrower to
pay any Guaranteed Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice or otherwise, each of the Corporate
Guarantors hereby promises to and will, upon receipt of written demand by the
Agent on behalf of the Lenders, forthwith pay or cause to be paid to the Agent
for the benefit of the Lenders in cash an amount equal to the unpaid amount of
all the Guaranteed Obligations with interest on the portion thereof that
represents outstanding loans and/or reimbursement obligations with respect to
Letters of Credit (but without duplication of interest included in such
Guaranteed Obligations) at a rate of interest equal to the rate specified in
Section 2.9(a) hereof, and thereupon the Agent shall assign such Guaranteed
Obligation, together with all security interests, if any, then held by the
Agent in respect of such Guaranteed Obligation, to the Corporate Guarantors
making such payment; such assignment to be subordinate and junior first to the
rights of the Agent on behalf of the Lenders and second to either of the
Guarantors if applicable under the Priority and Contribution Agreement with
regard to amounts payable by the Borrower in connection with the remaining
unpaid Obligations and to be pro tanto to the extent to which the Obligation in
question was discharged by the Corporate Guarantor or Corporate Guarantors
making such payments.
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(b) Upon payment by any Corporate Guarantor of any sums
to the Agent on behalf of the Lenders hereunder or to the Lenders, all rights
of such Corporate Guarantor against the Borrower, arising as a result thereof
by way of right of subrogation or otherwise, shall in all respects be
subordinate and junior in right of payment to the prior final and indefeasible
payment in full of first all the Obligations to the Agent on behalf of the
Lenders or to the Lenders and second to either of the Guarantors if applicable
under the Guaranty Agreement.
(c) Each Corporate Guarantor which guarantees obligations
hereunder, to the fullest extent permitted by Applicable Law, waives all rights
of such Corporate Guarantor against the Borrower or either of the Guarantors
arising as a result of payments made pursuant to such guarantees by way of
right of subrogation or otherwise. If any amount shall be paid to such
Corporate Guarantor for the account of the Borrower involved, such amount shall
be held in trust for the benefit of the Agent and shall forthwith be paid to
the Agent for the benefit of the Lenders to be credited and applied to the
Obligations when due and payable.
SECTION 9.4. Limitation on Guaranteed Amount.
Notwithstanding any other provision of this Article 9, the
amount guaranteed by any Corporate Guarantor hereunder shall be limited to the
extent, if any, required so that its obligations under this Article 9 shall not
be subject to avoidance under Section 548 of the Bankruptcy Code or to being
set aside or annulled under any Applicable Law relating to fraud on creditors.
In determining the limitations, if any, on the amount of such Corporate
Guarantor's obligations hereunder pursuant to the preceding sentence, any
rights of subrogation or contribution which such Corporate Guarantor may have
under this Article 9 or Applicable Law shall be taken into account.
SECTION 9.5. Termination.
The guarantees under this Article 9 shall terminate when all
the Obligations shall have been fully paid and performed, the Commitments
(including any commitment to issue any
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Letter of Credit) shall have been terminated and all Letters of Credit shall
have expired or been terminated or cancelled.
10. CASH COLLATERAL
SECTION 10.1. Cash Collateral Account.
On or prior to the Closing Date, there shall be established
with the Agent a collateral account in the name of the Agent (the "Cash
Collateral Account"), into which the Borrower shall from time to time deposit
Dollars pursuant to the express provisions of this Agreement requiring or
permitting such deposits. Except to the extent otherwise provided in this
Article 10, the Cash Collateral Account shall be under the sole dominion and
control of the Agent.
SECTION 10.2. Investment of Funds.
(a) The Agent is hereby authorized and directed to invest
and reinvest the funds from time to time deposited in the Cash Collateral
Account or the Concentration Account on the instructions of the Borrower
(provided that such notice may be given verbally to be confirmed promptly in
writing) or, if the Borrower shall fail to give such instruction upon delivery
of any such funds, in the sole discretion of the Agent, provided that in no
event may the Borrower give instructions to the Agent to, or may the Agent in
its discretion, invest or reinvest funds in the Cash Collateral Account or the
Concentration Account, as the case may be, in other than Cash Equivalents
described in clause (i) of the definition of Cash Equivalents, or described in
clauses (ii) and (iii) of the definition of Cash Equivalents to the extent
issued by Chemical Bank.
(b) Any net income or gain on the investment of funds
from time to time held in the Cash Collateral Account or the Concentration
Account, as the case may be, shall be promptly reinvested by the Agent as a
part of the Cash Collateral Account or the Concentration Account, as the case
may be, and any net loss on any such investment shall be charged against the
Cash Collateral Account or the Concentration Account, as the case may be.
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(c) Neither the Agent nor the Lenders shall be a trustee
for the Borrower or shall have any obligations or responsibilities, or shall be
liable for anything done or not done, in connection with the Cash Collateral
Account or the Concentration Account, as the case may be, except as expressly
provided herein and except that the Agent shall have the obligations of a
secured party under the UCC. The Agent and the Lenders shall not have any
obligation or responsibilities and shall not be liable in any way for any
investment decision made pursuant to this Section 10.2 or for any decrease in
the value of the investments held in the Cash Collateral Account or the
Concentration Account, as the case may be.
SECTION 10.3. Grant of Security Interest.
For value received and to induce the Lenders to make Loans
from time to time to the Borrower as provided for in this Agreement, as
security for the payment of all of the Obligations, the Borrower hereby assigns
to the Agent (for the benefit of the Lenders), and grants to the Agent (for the
benefit of the Lenders), a first and prior Lien upon all the rights in and to
the Cash Collateral Account and the Concentration Account all cash, documents,
instruments and securities from time to time held therein, and all rights
pertaining to investments of funds in the Cash Collateral Account and the
Concentration Account and all products and proceeds of any of the foregoing.
All cash, documents, instruments and securities from time to time on deposit in
the Cash Collateral Account and the Concentration Account and all rights
pertaining to investments of funds in the Cash Collateral Account and the
Concentration Account shall immediately and without any need for any further
action on the part of the Borrower, any Lender or the Agent, become subject to
the Lien set forth in this Section 10.3, be deemed Collateral for all purposes
hereof and be subject to the provisions of this Agreement.
SECTION 10.4. Remedies.
At any time during the continuation of an Event of Default,
the Agent may sell any documents, instruments and securities held in the Cash
Collateral Account and the Concentration Account and may immediately apply the
proceeds thereof and any other cash held in the Cash Collateral Account
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and the Concentration Account to the satisfaction of the Obligations in such
order as the Agent may determine, but subject to the rights of the Lenders.
Any amounts remaining after such application shall be paid or delivered to the
Borrower or as a court of competent jurisdiction may direct.
11. THE AGENT AND THE ISSUING BANK
SECTION 11.1. Administration by Agent.
(a) The general administration of the Fundamental
Documents and any other documents contemplated by this Agreement shall be by
the Agent or its designees. Except as otherwise expressly provided herein,
each of the Lenders hereby irrevocably authorizes the Agent, at its discretion,
to take or refrain from taking such actions as agent on its behalf and to
exercise or refrain from exercising such powers under the Fundamental
Documents, the Notes and any other documents contemplated by this Agreement as
are delegated by the terms hereof or thereof, as appropriate, together with all
powers reasonably incidental thereto. The Agent shall have no duties or
responsibilities except as set forth in the Fundamental Documents.
(b) The Lenders hereby authorize the Agent (in its sole
discretion):
(i) in connection with the sale or other disposition of
any asset included in the Collateral, in accordance with the
terms of this Agreement, to release a Lien granted to it (for
the benefit of the Lenders) on such asset;
(ii) to determine that the cost to the Borrower or another
Credit Party is disproportionate to the benefit to be realized
by the Lenders by perfecting a Lien in a given asset or group
of assets included in the Collateral (other than any item
which is to be included in the Borrowing Base) and that the
Borrower or such other Credit Party should not be required to
perfect such Lien in favor of the Agent (for the benefit of
the Lenders);
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(iii) to appoint ▇▇▇▇▇▇▇ or other Persons to be the holder
of record of a Lien to be granted to the Agent (for the
benefit of the Lenders) or to hold on behalf of the Agent such
collateral or instruments relating thereto;
(iv) to modify any of the Fundamental Documents (other
than this Agreement, the Notes and the Guaranty) in order to
(x) cure any ambiguity, omission, defect or inconsistency, (y)
comply with the terms of transactions which are permitted by
the terms of Articles 5 or 6 hereof or which are otherwise
consented to by the requisite Lenders in accordance with the
terms hereof and (z) to add covenants of a Credit Party for
the benefit of the Lenders;
(v) to grant the right of Quiet Enjoyment to licensees
pursuant to the terms of Section 8.13; and
(vi) enter guild subordination agreements with the guilds
with respect to the security interests in favor of the guilds
required pursuant to the terms of the collective bargaining
agreements.
SECTION 11.2. Advances and Payments.
(a) On the date of each Loan, the Agent shall be
authorized (but not obligated) to advance, for the account of each of the
Lenders, the amount of the Loan to be made by it in accordance with its
Percentage hereunder. Each of the Lenders hereby authorizes and requests the
Agent to advance for its account, pursuant to the terms hereof, the amount of
the Loan to be made by it, of the Lenders agrees forthwith to reimburse the
Agent in immediately available funds for the amount so advanced on its behalf
by the Agent. If any such reimbursement is not made in immediately available
funds on the same day on which the Agent shall have made any such amount
available on behalf of any Lender, such Lender shall pay interest to the Agent
at a rate per annum equal to the Agent's cost of obtaining overnight funds in
the New York Federal Funds Market for the first three days following the time
when the Lender fails to make the required reimbursement, and thereafter at a
rate per annum equal to the Alternate Base Rate plus the Applicable Margin for
Alternate Base
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Rate Loans. If and to the extent that any such reimbursement shall not have
been made to the Agent, the Borrower agrees to repay to the Agent forthwith on
demand a corresponding amount with interest thereon for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Agent at the Alternate Base Rate plus the Applicable Margin for
Alternate Base Rate Loans.
(b) As between the Agent and the Lenders, any amounts
received by the Agent in connection with the Fundamental Documents (other than
amounts to which the Agent or any Lender is entitled pursuant to 2.13 and
12.5), the application of which is not otherwise provided for, shall be
applied, first, to pay accrued but unpaid Commitment Fees in accordance with
each Lender's Percentage, second, to pay accrued but unpaid interest on the
Term Notes in accordance with the amount of outstanding Term Loans owed to each
Lender, third, the principal balance outstanding on the Term Notes (with
amounts payable on the principal balance outstanding on the Term Notes in
accordance with each Lender's Percentage) and amounts outstanding under
Currency Agreements and Interest Rate Protection Agreements and, fourth, to pay
accrued but unpaid interest on the Revolving Credit Notes in accordance with
the amount of outstanding Revolving Credit Loans owed to each Lender, fifth,
the principal balance outstanding on the Revolving Credit Notes (with amounts
payable in the principal balance outstanding in the Revolving Credit Notes in
accordance with each Lender's Percentage) and, sixth, to pay any other amounts
then due under this Agreement. All amounts to be paid to any Lender by the
Agent shall be credited to that ▇▇▇▇▇▇, after collection by the Agent, in
immediately available funds either by wire transfer or deposit in such ▇▇▇▇▇▇'s
correspondent account with the Agent, or as such ▇▇▇▇▇▇ and the Agent shall
from time to time agree.
SECTION 11.3. Sharing of Setoffs.
Each of the Lenders agrees that if it shall, through the
exercise of a right of banker's lien, setoff or counterclaim against the
Borrower (including, but not limited to, a secured claim under Section 506 of
Title 11 of the United States Code or other security or interest arising from,
or in lieu of, such secured claim and received by such Lender under any
applicable bankruptcy, insolvency or other similar law) or otherwise, obtain
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payment in respect of its Loans as a result of which the unpaid portion of its
Loans and L/C Exposure is proportionately less than the unpaid portion of the
Loans and L/C Exposure of any of the other Lenders (a) it shall promptly
purchase at par (and shall be deemed to have thereupon purchased) from such
other Lenders an interest in the Loans or Letters of Credit of such other
Lenders, so that the aggregate unpaid principal amount of each of the Lenders'
Loans and its interest in Loans and Letters of Credit of the other Lenders
shall be in the same proportion to the aggregate unpaid principal amount of all
Loans then outstanding and L/C Exposure as the principal amount of its Loans
and L/C Exposure prior to the obtaining of such payment was to the principal
amount of all Loans outstanding and L/C Exposure prior to the obtaining of such
payment and (b) such other adjustments shall be made from time to time as shall
be equitable to ensure that the Lenders share the benefit of such payments pro
rata. If all or any portion of such excess payment is thereafter recovered
from the Lender which originally received such excess payment, such purchase
(or portion thereof) shall be cancelled and the purchase price restored to the
extent of such recovery. The Borrower expressly consents to the foregoing
arrangements and agree that any Lender or Lenders holding (or deemed to be
holding) a participation or other interest in a Note or Letter of Credit may
exercise any and all rights of banker's lien, setoff or counterclaim with
respect to any and all moneys owing by the Borrower to such Lender or Lenders
as fully as if such Lender or Lenders held a Note and was the original obligee
thereon or was the issuer of the Letter of Credit, in the amount of such
participation or other interest.
SECTION 11.4. Agreement of Required Lenders.
Upon any occasion requiring or permitting an approval,
consent, waiver, election or other action on the part of the Required Lenders,
action shall be taken by the Agent for and on behalf of, or for the benefit of,
all Lenders upon the direction of the Required Lenders, and any such action
shall be binding on all Lenders. No amendment, modification, consent or waiver
shall be effective except in accordance with the provisions of Section 12.9
hereof.
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SECTION 11.5. Notice to Lenders.
Upon receipt by the Agent from the Borrower of any written
communication calling for an action on the part of the Lenders, or upon written
notice to the Agent of any Default or Event of Default, the Agent will in turn
promptly inform the other Lenders in writing (which shall include facsimile
communications) of the nature of such communication or of the Default or Event
of Default, as the case may be.
SECTION 11.6. Liability of Agent and Issuing Bank.
(a) The Agent or the Issuing Bank, when acting on behalf
of the Lenders, may execute any of its duties under this Agreement or the other
Fundamental Documents by or through its officers, agents, and employees, and
neither the Agent, the Issuing Bank nor their respective directors, officers,
agents, or employees shall be liable to the Lenders or any of them for any
action taken or omitted to be taken in good faith nor be responsible to the
Lenders or to any of them for the consequences of any oversight or error of
judgment, or for any loss, unless the same shall happen through its gross
negligence or willful misconduct. The Agent, the Issuing Bank and their
respective directors, officers, agents, and employees shall in no event be
liable to the Lenders or to any of them for any action taken or omitted to be
taken by it pursuant to instructions received by it from the Lenders or in
reliance upon the advice of counsel selected by it with reasonable care.
Without limiting the foregoing, neither the Agent, the Issuing Bank nor any of
their respective directors, officers, employees, or agents shall be responsible
to any of the Lenders for the due execution, validity, genuineness,
effectiveness, sufficiency, or enforceability of, or for any statement,
warranty, or representation in, or for the perfection of any security interest
contemplated by, this Agreement, the Copyright Security Agreement, any
Copyright Security Agreement Supplement or any of the other Fundamental
Documents or any related agreement, document or order, or for the designation
or failure to designate this transaction as a "Highly Leveraged Transaction"
for regulatory purposes or for freedom of any of the Collateral or any of the
Pledged Securities from prior liens or security interests, or shall be required
to ascertain or to make any inquiry concerning the performance or observance by
the Borrower
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or any other Credit Party of any of the terms, conditions, covenants, or
agreements of this Agreement, any Completion Guaranty for an item of Product,
or any of the other Fundamental Documents or any related agreement or document.
(b) Neither the Agent as Agent for the Lenders hereunder,
the Issuing Bank nor any of their respective directors, officers, employees, or
agents shall have any responsibility to any Credit Party on account of the
failure or delay in performance or breach by any of the Lenders (other than the
Agent) of any of their respective obligations under this Agreement, the other
Fundamental Documents or any related agreement or document or in connection
herewith or therewith.
(c) The Agent as agent for the Lenders hereunder and the
Issuing Bank in such capacities, shall be entitled to rely on any
communication, instrument, or document believed by it to be genuine or correct
and to have been signed or sent by a Person or Persons believed by it to be the
proper Person or Persons, and it shall be entitled to rely on advice of legal
counsel, independent public accountants, and other professional advisers and
experts selected by it.
SECTION 11.7. Reimbursement and Indemnification.
Each Lender agrees (i) to reimburse the Agent for such
▇▇▇▇▇▇'s Percentage of any expenses and fees incurred for the benefit of the
Lenders under the Fundamental Documents for which the Agent is entitled to seek
reimbursement from any Credit Party but which has not actually been reimbursed
by or on behalf of any Credit Party, including, without limitation, counsel
fees and compensation of agents and employees paid for services rendered on
behalf of the Lenders, and any other expense incurred in connection with the
operations or enforcement thereof not reimbursed by or upon behalf of the
Borrower, (ii) to indemnify and hold harmless the Agent and any of its
directors, officers, employees, or agents, on demand, in the amount of its
proportionate share, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed on,
incurred by, or asserted against it or any of them in any way relating to or
arising out of any Completion Guaranty for an item of Product, the
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Fundamental Documents or any action taken or omitted by it or any of them under
any Completion Guaranty for an item of Product, the Fundamental Documents or
any related agreement or document, to the extent not reimbursed by a Credit
Party and (iii) in the case of only those Lenders holding Revolving Credit
Commitments, to indemnify and hold harmless the Issuing Bank and any of its
directors, officers, employees, or agents, on demand, in the amount of its
Percentage, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs expenses or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against it or any of them in any way relating to or arising out of the
issuance of any Letters of Credit or the failure to issue Letters of Credit if
such failure or issuance was at the direction of Required Lenders holding at
least 66-2/3% of the Revolving Credit Commitments (except in the case of clause
(i), (ii) or (iii) above, as shall result from the gross negligence or willful
misconduct of the Person to be reimbursed, indemnified or held harmless, as
applicable).
SECTION 11.8. Rights of Agent.
It is understood and agreed that the Agent shall have the same
duties, rights and powers as a Lender hereunder (including the right to give
such instructions) as the other Lenders and may exercise such rights and
powers, as well as its rights and powers under other agreements and instruments
to which it is or may be a party, and engage in other transactions with any
Credit Party, as though it were not the Agent for Lenders or the Issuing Bank
under this Agreement and the other Fundamental Documents.
SECTION 11.9. Independent Investigation by ▇▇▇▇▇▇▇.
Each of the Lenders acknowledges that it has decided to enter
into this Agreement, and to make the Loans and participate in the Letters of
Credit hereunder based upon its own analysis of the transactions contemplated
hereby and of the creditworthiness of the Credit Parties and agrees that
neither the Agent nor the Issuing Bank shall bear any responsibility for such
creditworthiness.
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SECTION 11.10. Notice of Transfer.
The Agent may deem and treat any Lender which is a party to
this Agreement on the date hereof as the owner of such ▇▇▇▇▇▇'s respective
portions of the Loans and participations in Letters of Credit for all purposes,
unless and until a written notice of the assignment or transfer thereof
executed by any such Lender shall have been received by the Agent and become
effective pursuant to Section 12.3 hereof.
SECTION 11.11. Successor Agent.
The Agent may resign at any time by giving written notice
thereof to the Lenders and the Borrower, but such resignation shall not become
effective until acceptance by a successor Agent of its appointment pursuant
hereto. Upon any such resignation, the retiring Agent shall promptly appoint a
successor Agent from among the Lenders, which is sophisticated in entertainment
industry lending, provided that such replacement is reasonably acceptable (as
evidenced in writing) to the Borrower and the Required Lenders. If no
successor agent shall have been so appointed by the retiring Agent and shall
have accepted such appointment, within 30 days after the retiring Agent's
giving of notice of resignation, the Borrower may appoint a successor agent
(which successor may be replaced by the Required ▇▇▇▇▇▇▇ provided that such
successor is sophisticated in the entertainment industry lending and reasonably
acceptable to the Borrower), which shall be either a Lender or a commercial
bank organized under the laws of the United States of America or of any State
thereof and having a combined capital and surplus of at least $250,000,000 and
which is sophisticated in entertainment industry lending. Upon the acceptance
of any appointment as Agent hereunder by a successor agent, such successor
agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged, except for any liabilities incurred prior thereto, from its duties
and obligations under this Agreement the other Fundamental Documents and any
other credit documentation. After any retiring Agent's resignation hereunder
as Agent, the provisions of this Article 11 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement.
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SECTION 11.12. Dissemination of Information.
The Agent shall deliver to the Lenders copies of (i) all items
received from the Borrower pursuant to Section 5.1(e) and Section 5.1(n) and
(ii) any other information received by the Agent pursuant to any provision of
this Agreement, copies of which are requested of any Lender.
12. MISCELLANEOUS
SECTION 12.1. Notices.
Notices and other communications provided for herein shall be
in writing and shall be delivered or mailed (or if by facsimile, delivered by
such equipment) addressed, if to the Agent, the Issuing Bank or Chemical Bank,
to it at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, III,
facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ with a copy to CBC-USA, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or if to a Credit
Party to it at 1888 Century Park East, Seventh Floor, Los Angeles, CA 90067,
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇, facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to ▇▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ or to a Lender, to it at
its address set forth on the signature page of this Agreement, or such other
address as such party may from time to time designate by giving written notice
to the other parties hereunder. All notices and other communications given to
any party hereto in accordance with the provisions of this Agreement shall be
deemed to have been given on the fifth Business Day after the date when sent by
registered or certified mail, postage prepaid, return receipt requested, if by
mail, or when receipt is acknowledged, if by any other method, in each case
addressed to such party as provided in this Section 12.1 or in accordance with
the latest unrevoked written direction from such party.
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SECTION 12.2. Survival of Agreement, Representations and
Warranties, etc.
All warranties, representations, covenants and agreements made
by any of the Credit Parties herein, in any other Fundamental Document or in
any certificate or other instrument delivered by it or on its behalf pursuant
to this Agreement or any other Fundamental Document shall be considered to have
been relied upon by the Lenders, and shall survive the making of the Loans and
the issuance of the Letters of Credit herein contemplated and the execution and
delivery to the Agent of the Notes regardless of any investigation made by the
Agent or the Lenders or on their behalf and shall continue in full force and
effect so long as any amount due or to become due hereunder is outstanding and
unpaid, so long as the Letter of Credit remains outstanding and so long as any
Commitment has not been terminated. All statements in any such certificate or
other instrument delivered pursuant to this Agreement or a Fundamental Document
shall constitute representations and warranties made by the Credit Parties
hereunder.
SECTION 12.3. Successors and Assigns; Syndications; Loan
Sales; Participations.
(a) Whenever in this Agreement any of the parties hereto
is referred to, such reference shall be deemed to include the successors and
assigns of such party (provided, however, that neither the Borrower nor any
other Credit Party may assign its respective rights or obligations hereunder
without the prior written consent of all the Lenders), and all covenants,
promises and agreements by or on behalf of the Credit Parties which are
contained in this Agreement shall bind and inure to the benefit of the
successors and assigns of all such parties.
(b) Each of the Lenders may, with the prior written
consent of the Agent which consent shall not be unreasonably withheld, assign
to one or more banks or other entities (other than a competitor of the
Borrower) all or a portion of its interests, rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment,
and the same portion of the Loans at the time owing to it, the Notes held by it
and its obligations and rights with regard to any Letters of Credit); provided,
however, that (i)
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each such assignment shall be of a constant, and not a varying, percentage of
all of the assigning ▇▇▇▇▇▇'s interests, rights and obligations under this
Agreement, (ii) the amount of the Commitment of the assigning Lender being
assigned pursuant to each such assignment (determined as of the effective date
of the Assignment and Acceptance with respect to such assignment delivered to
the Agent) shall be (x) in the case of a Lender which has a Term Loan
Commitment only, in a minimum amount of $5,000,000 and (y) in the case of any
other Lender, in a minimum amount of $10,000,000 and (iii) the parties to each
such assignment shall execute and deliver to the Agent, for its acceptance and
recording in the Register (as defined below), an Assignment and Acceptance,
together with the assigning ▇▇▇▇▇▇'s original Notes and a processing and
recordation fee of $2,500 to be paid to the Agent by the assigning ▇▇▇▇▇▇, such
fee not to be paid or reimbursed by the Borrower. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall not (unless
otherwise agreed to by the Agent) be earlier than five Business Days after the
date of acceptance and recording by the Agent, (x) the assignee thereunder
shall be a party hereto and, to the extent provided in such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and under the
other Fundamental Documents and shall be bound by the provisions hereof and
thereof and (y) the assigning Lender thereunder shall, to the extent provided
in such Assignment and Acceptance, be relieved of its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of the assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto).
(c) Notwithstanding the other provisions of this Section
12.3(b), each Lender may at any time make an assignment of its interests,
rights and obligations under this Agreement to (i) any Affiliate of such Lender
(other than a competitor of the Borrower) or (ii) any other Lender hereunder,
provided that after giving effect to such assignment, the assignee's Percentage
shall not exceed the Agent's Percentage without the consent of the Agent which
consent shall not be unreasonably withheld.
(d) By executing and delivering an Assignment and
Acceptance, the assigning Lender thereunder and the assignee
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thereunder confirm to and agree with each other and the other parties hereto as
follows: (i) other than the representation and warranty that it is the legal
and beneficial owner of the interest being assigned thereby and that such
interest is free and clear of any adverse claim, the assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the other Fundamental Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Fundamental
Documents or any other instrument or document furnished pursuant hereto or
thereto; (ii) such Lender assignor makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any of the
Credit Parties or the performance or observance by any of the Credit Parties of
any of their obligations under the Fundamental Documents or any other
instrument or document furnished pursuant hereto or thereto; (iii) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the most recent financial statements delivered pursuant to Sections
5.1(a) and 5.1(b) (or if none of such financial statements shall have then been
delivered, then copies of the financial statements referred to in Section 3.4
hereof) and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into such Assignment and
Acceptance; (iv) such assignee agrees that it will, independently and without
reliance upon the Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement or any other Fundamental Document; (v) such assignee appoints
and authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement or any other Fundamental Document as
are delegated to the Agent by the terms hereof or thereof, together with such
powers as are reasonably incidental thereto; and (vi) such assignee agrees that
it will be bound by the provisions of this Agreement and it will perform in
accordance with their terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Lender.
(e) The Agent shall maintain at its address at which
notices are to be given to it pursuant to Section 12.1 a copy of
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each Assignment and Acceptance and a register for the recordation of the names
and addresses of the Lenders and the Commitments of, and principal amount of
the Loans owing to, each Lender from time to time (the "Register"). The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Credit Parties, the Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of the
Fundamental Documents. The Register shall be available for inspection by any
Credit Party or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an assignee together with the assigning
▇▇▇▇▇▇'s original Notes and the processing and recordation fee, the Agent
shall, if such Assignment and Acceptance has been completed and is in the form
of Exhibit G hereto, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt written
notice thereof to the Borrower. Within five (5) Business Days after receipt of
the notice, the Borrower, at its own expense, shall execute and deliver to the
Agent, in exchange for the surrendered Notes, new Notes to the order of such
assignee in amounts equal to the Commitment assumed by it pursuant to such
Assignment and Acceptance and, if the assigning ▇▇▇▇▇▇ has retained a
Commitment hereunder, new Notes to the order of the assigning ▇▇▇▇▇▇ in amounts
equal to the Commitments retained by it hereunder. Such new Notes shall be in
an aggregate principal amount equal to the principal amount of the surrendered
Notes, shall be dated the date of the surrendered Notes and shall otherwise be
in substantially the forms of Exhibits A-1 and A-2. In addition each Credit
Party will promptly, at its own expense, execute such amendments to the
Fundamental Documents to which it is a party and such additional documents, and
take such other actions as the Agent or the assignee Lender may reasonably
request in order to give such assignee Lender the full benefit of the Liens
contemplated by the Fundamental Documents and the guaranty contemplated hereby.
(g) Each of the Lenders may, without the consent of the
Borrower, the Agent or the other Lenders, sell participations to one or more
banks or other entities in all or a portion of its rights and obligations under
this Agreement (including, without
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limitation, all or a portion of its Commitment, the Loans owing to it and the
Notes held by it); provided, however, that (i) any such Lender's obligations
under this Agreement shall remain unchanged, (ii) such participant shall not be
granted any voting rights or any right to control the vote of such Lender under
this Agreement, except with respect to proposed changes to interest rates,
amounts of Commitments, releases of all or substantially all of the Collateral
and Pledged Securities, maturity of any Loan and fees (as applicable to such
participant), (iii) any such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations, (iv) the
participating banks or other entities shall be entitled to the cost protection
provisions contained in Sections 2.12, 2.13, and 2.14 and 11.3 hereof but a
participant shall not be entitled to receive pursuant to such provisions an
amount larger than its share of the amount to which the Lender granting such
participation is actually entitled to receive and (v) the Credit Parties, the
Agent and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such ▇▇▇▇▇▇'s rights and obligations under this
Agreement.
(h) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
12.3, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Credit Parties; provided that
prior to any such disclosure, each such assignee or participant or proposed
assignee or participant shall agree in writing to preserve in accordance with
Section 12.16 hereof the confidentiality of any confidential information
relating to any Credit Party received from such Lender.
(i) The Borrower consents that any Lender may at any time
and from time to time pledge or otherwise grant a security interest in any Loan
or in any Note evidencing the Loans (or any part thereof) to any Federal
Reserve Bank.
SECTION 12.4. Expenses; Documentary Taxes.
Whether or not the transactions hereby contemplated shall be
consummated, the Borrower agrees to pay all reasonable fees and out-of-pocket
expenses incurred by the Agent or Chemical Securities Inc. in connection with,
or growing out of, the
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performance of due diligence, the syndication of the credit facility
contemplated hereby, the negotiation, preparation, execution, delivery, waiver
or modification, administration and enforcement of this Agreement, the Pledged
Securities, the Notes and the other Fundamental Documents or any Completion
Guaranty for an item of Product, the making of the Loans, the issuance of the
Letters of Credit or the Collateral including but not limited to the reasonable
out-of-pocket costs and internally allocated charges of audit or field
examination of the Agent in connection with the administration of this
Agreement, the verification of financial data and the transactions contemplated
hereby, and the reasonable fees and disbursements of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇
LLP, counsel for the Agent, and any other legal counsel that the Agent shall
retain as well as all reasonable out-of-pocket expenses and reasonable
allocated costs incurred by the Agent, the Issuing Bank or the Lenders in the
enforcement or protection (as distinguished from administration) of the rights
and remedies of the Lenders in connection with this Agreement, the other
Fundamental Documents, the Letters of Credit or the Notes, or as a result of
any transaction, action or non-action arising from any of the foregoing,
including but not limited to the reasonable fees and disbursements of any
outside counsel for the Agent, the Issuing Bank or the Lenders. Such payments
shall be made on the date of execution of this Agreement by the Borrower and
thereafter on demand. The Borrower agrees that it shall indemnify the Agent,
the Issuing Bank and the Lenders from and hold them harmless against any
documentary taxes, assessments or charges made by any Governmental Authority by
reason of the execution and delivery of this Agreement, the Notes (excluding
Notes executed and delivered solely as a result of an assignment pursuant to
Section 12.3) or the issuance of Letters of Credit. The obligations of the
Borrower under this Section shall survive the termination of this Agreement
and/or the payment of the Loans and/or the expiration of any Letter of Credit.
SECTION 12.5. Indemnity.
The Borrower agrees (a) to indemnify and hold harmless the
Agent and the Lenders and their respective directors, officers, employees,
trustees and agents and, in addition, in connection with matters relating to
the Letters of Credit, the Issuing Bank and its directors, officers, employees
and agents (each an "Indemnified Party") (to the full extent permitted by
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Applicable Law) from and against any and all claims, demands, losses, judgments
and liabilities (including liabilities for penalties) 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 any Lender or
the Agent is a party thereto) related to the entering into and/or performance
of any Fundamental Document or the use of the proceeds of any Loans hereunder
or the issuance of any Letter of Credit or the consummation of any other
transactions contemplated in any Fundamental 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 of an
Indemnified Party to the extent incurred by reason of the gross negligence or
willful misconduct of the Indemnified Party). If any proceeding, including any
governmental investigation, shall be instituted involving any Indemnified
Party, in respect of which indemnity may be sought against the Borrower, such
Indemnified Party shall promptly notify the Borrower in writing, and the
Borrower shall assume the defense thereof on behalf of such Indemnified Party
including the employment of counsel (reasonably satisfactory to such
Indemnified Party) and payment of all reasonable expenses. Any Indemnified
Party shall have the right to employ separate counsel in any such proceeding
and participate in the defense thereof, but the fees and expenses of such
separate counsel shall be at the expense such Indemnified party unless (i) the
employment of such separate counsel has been specifically authorized by the
Borrower or (ii) the named parties to any such action (including any impleaded
parties) include such Indemnified Party and the Borrower and such Indemnified
Party shall have been advised in writing by counsel to the Agent that an actual
conflict of interest exists between such Indemnified Party and the Borrower (in
which case the Borrower shall not have the right to assume the defense of such
action on behalf of such Indemnified Party). At any time after the Borrower
has assumed the defense of any proceeding involving any Indemnified Party in
respect of which indemnity has been sought against the Borrower, such
Indemnified Party may elect, by written notice to the Borrower, to withdraw its
request for indemnity and thereafter the defense of such proceeding shall be
maintained by counsel of the Indemnified Party's choosing at the Indemnified
Party's expense. The foregoing indemnity agreement includes any reasonable
costs
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incurred by an Indemnified Party in connection with any action or proceeding
which may be instituted in respect of the foregoing by the Agent or the Issuing
Bank or by any other Person either against the Agent, the Issuing Bank or the
Lenders or in connection with which any officer or employee of the Agent, the
Issuing Bank or the Lenders is called as a witness or deponent, including, but
not limited to, the reasonable fees and disbursements of ▇▇▇▇▇▇, ▇▇▇▇▇ &
▇▇▇▇▇▇▇ LLP, counsel to the Agent and any out-of-pocket costs incurred by the
Agent, the Issuing Bank or the Lenders in appearing as a witness or in
otherwise complying with legal process served upon them. The obligations of
the Borrower under this Section 12.5 shall survive the termination of this
Agreement, the payment of the Loans and/or the expiration or termination of any
Letter of Credit and shall inure to the benefit of any Person who was a Lender
notwithstanding such Person's Assignment of all its Loans and Commitment
hereunder.
If a Credit Party shall fail to do any act or thing which it
has covenanted to do hereunder, under a Fundamental Document or a Completion
Guaranty, or any representation or warranty of a Credit Party shall be
breached, the Agent may (but shall not be obligated to) do the same or cause it
to be done or remedy any such breach and there shall be added to the
Obligations hereunder the cost or expense incurred by the Agent in so doing,
and any and all amounts expended by the Agent in taking any such action shall
be repayable to it upon its demand therefor and shall bear interest at 3% in
excess of the Alternate Base Rate from time to time in effect for Revolving
Credit Loans from the date advanced to the date of repayment.
SECTION 12.6. CHOICE OF LAW.
THIS AGREEMENT AND THE NOTES SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
MADE AND TO BE PERFORMED WHOLLY WITHIN SUCH STATE AND, IN THE CASE OF
PROVISIONS RELATING TO INTEREST RATES, ANY APPLICABLE LAW OF THE UNITED STATES
OF AMERICA. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN SUCH LETTER OF
CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM CUSTOMS AND
PRACTICES FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION NO. 500
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(THE "UNIFORM CUSTOMS") AND, AS TO MATTERS NOT GOVERNED BY THE UNIFORM CUSTOMS,
THE LAWS OF THE STATE OF NEW YORK.
SECTION 12.7. No Waiver.
No failure on the part of the Agent, any Lender or the Issuing
Bank to exercise, and no delay in exercising, any right, power, privilege or
remedy hereunder or under the Notes, any other Fundamental Document or with
regard to any Letter of Credit shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power, privilege or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power, privilege or remedy. All remedies hereunder are cumulative and
are not exclusive of any other remedies provided by law.
SECTION 12.8. Extension of Maturity.
Should any payment of principal of or interest on the Notes or
any other amount due hereunder become due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day (other than the maturity of a Eurodollar Loan if the next Business
Day shall fall in the next calendar month, in which case, such maturity shall
end on the next preceding Business Day) and, in the case of principal, interest
shall be payable thereon at the rate per annum herein specified during such
extension.
SECTION 12.9. Amendments; Waivers.
No modification, amendment or waiver of any provision of this
Agreement, and no consent to any departure by a Credit Party from the
provisions of this Agreement, shall in any event be effective unless the same
shall be in writing and signed by the Required Lenders, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such modification,
amendment or waiver shall without the written consent of all the Lenders, (i)
increase the Commitment of a Lender; (ii) alter the stated maturity or
principal amount of any Loan, or the rate of interest payable thereon, or the
maturity or amount of any other payment required to be made under this
Agreement; (iii) decrease the Commitment of any Lender; (iv) amend or
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modify any provision of this Agreement which provides for the unanimous consent
or approval of the Lenders; (v) amend this Section 12.9 or the definition of
Required Lenders; (vi) subordinate the Obligations hereunder to other
Indebtedness or subordinate the security interests of the Lenders in the
Collateral except as permitted by Section 11.1; (vii) authorize the release of
any Collateral or any Pledged Securities, except as permitted by Section 11.1;
(viii) release any Guarantor; or (ix) amend Section 2.12(d), Section 2.12(e) or
Section 12.3(a). No such amendment, modification or waiver may adversely
affect the rights and obligations of the Agent hereunder without its prior
written consent or the rights and obligations of the Issuing Bank without its
prior written consent. No notice to or demand on any Credit Party which is a
party hereto shall entitle such Credit Party to any other or further notice or
demand in the same, similar or other circumstances. Each holder of a Note
shall be bound by any amendment, modification, waiver or consent authorized as
provided herein, whether or not a Note shall have been marked to indicate such
amendment, modification, waiver or consent and any consent by any holder of a
Note shall bind any Person subsequently acquiring a Note, whether or not a Note
is so marked.
SECTION 12.10. Severability.
Any provision of this Agreement or of the Notes which is
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without invalidating the remaining provisions hereof, and any
such invalidity, illegality or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
SECTION 12.11. WAIVER OF JURY TRIAL.
TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE
WAIVED, EACH CREDIT PARTY HEREBY WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT
(WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN
ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION
ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR ANY
FUNDAMENTAL DOCUMENT, IN EACH CASE WHETHER NOW EXISTING OR
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HEREAFTER ARISING OR WHETHER IN CONTRACT OR TORT OR OTHERWISE. EACH CREDIT
PARTY ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE LENDERS THAT THE PROVISIONS
OF THIS SECTION 12.11 CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH THE LENDERS
HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT AND ANY
OTHER FUNDAMENTAL DOCUMENT. THE AGENT OR ANY LENDER MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 12.11 WITH ANY COURT AS WRITTEN EVIDENCE
OF THE CONSENT OF ANY CREDIT PARTY TO THE WAIVER OF ITS RIGHTS TO TRIAL BY
JURY.
SECTION 12.12. SERVICE OF PROCESS.
EACH CREDIT PARTY (EACH THE "SUBMITTING PARTY") HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE COURTS OF THE STATE OF NEW
YORK AND TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK, FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER
PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER
HEREOF BROUGHT BY THE AGENT. EACH SUBMITTING PARTY TO THE EXTENT PERMITTED BY
APPLICABLE LAW (A) HEREBY WAIVES, AND AGREES NOT TO ASSERT, BY WAY OF MOTION,
AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH COURTS, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF
THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT
OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT
FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER OR THAT
THIS AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE ENFORCED IN OR BY SUCH
COURT, AND (B) HEREBY WAIVES THE RIGHT TO ASSERT IN ANY SUCH ACTION, SUIT OR
PROCEEDING ANY OFFSETS OR COUNTERCLAIMS EXCEPT COUNTERCLAIMS THAT ARE
COMPULSORY. EACH SUBMITTING PARTY HEREBY CONSENTS TO SERVICE OF PROCESS BY
MAIL AT THE ADDRESS TO WHICH NOTICES ARE GIVEN PURSUANT TO SECTION 12.1. EACH
SUBMITTING PARTY AGREES THAT ITS SUBMISSION TO JURISDICTION AND CONSENT TO
SERVICE OF PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF THE AGENT, THE
ISSUING BANK AND THE LENDERS. FINAL JUDGMENT AGAINST ANY SUBMITTING PARTY IN
ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE, AND MAY BE ENFORCED IN
ANY OTHER JURISDICTION (X) BY SUIT, ACTION OR PROCEEDING ON THE JUDGMENT, A
CERTIFIED OR TRUE COPY OF WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE FACT AND
THE AMOUNT OF INDEBTEDNESS OR LIABILITY THEREIN DESCRIBED OR (Y) IN ANY OTHER
MANNER PROVIDED BY OR PURSUANT TO THE LAWS OF SUCH OTHER JURISDICTION,
PROVIDED, HOWEVER, THAT THE AGENT, THE
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ISSUING BANK OR A LENDER MAY AT ITS OPTION BRING SUIT, OR INSTITUTE OTHER
JUDICIAL PROCEEDINGS AGAINST ANY SUBMITTING PARTY OR ANY OF THEIR RESPECTIVE
ASSETS IN ANY STATE OR FEDERAL COURT OF THE UNITED STATES OR OF ANY COUNTRY OR
PLACE WHERE ANY SUBMITTING PARTY OR SUCH ASSETS MAY BE FOUND.
SECTION 12.13. Headings.
Section headings used herein and the Table of Contents are for
convenience only and are not to affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 12.14. Execution in Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall constitute an original, but all of which taken together
shall constitute one and the same instrument.
SECTION 12.15. Termination of Agreement.
Except for the provisions of this Agreement and the
Fundamental Documents which by their terms survive the termination of this
Agreement and the Fundamental Documents, this Agreement, each Fundamental
Document, the security interest granted pursuant to Article 8 and the guaranty
pursuant to Article 9 shall terminate when all the Obligations shall have been
fully paid and performed and any amounts owing to any Guarantor pursuant to
such Guarantor's rights of subrogation are paid in full, the Commitments
(including any commitment to issue any Letter of Credit) shall have terminated
and all Letters of Credit shall have expired or been terminated or cancelled.
SECTION 12.16. Confidentiality.
Each of the Lenders understands that the information furnished
to it pursuant to this Agreement will be received by it prior to the time that
such information shall have been made public, and each of the Lenders hereby
agrees that it will keep, and will direct its officers and employees to keep,
all the information provided to it pursuant to this Agreement confidential
prior to its becoming public (through publication
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other than as a result of action by one of the Lenders in violation of
this Section 12.16) except that Lenders shall be permitted to disclose such
information (i) to officers, directors, employees, representatives, agents,
auditors, consultants, advisors, lawyers and affiliates of such Lender, in the
ordinary course of business who have been made aware of the confidential nature
of the information; (ii) to such officers, directors, employees, agents and
representatives of a prospective assignee or participant as need to know such
information in connection with the evaluation of a possible participation in
the Loans hereunder (who agrees in writing to be bound by this provision will
be informed of the confidential nature of the material); (iii) as required by
Applicable Law, or pursuant to subpoenas or other legal process, or as
requested by governmental agencies and examiners or to others and the right of
the Lenders to use such information in proceedings to enforce their rights and
remedies hereunder or under any other Fundamental Document or in any proceeding
against the Lenders in connection with this Agreement or under any other
Fundamental Document or the transactions contemplated hereunder; (iv) to the
extent such information (A) becomes publicly available other than as a result
of a breach of this Agreement or (B) becomes available to a Lender or a
participant on a non-confidential basis, not in breach of any agreement or
other obligation to the Borrower, from a source other than the Borrower; (v) to
the extent the Borrower shall have consented to such disclosure in writing;
(vi) to any corporation controlled by a Lender or a Lender's participant or
under common control with a Lender or a ▇▇▇▇▇▇'s participant in connection with
the sale of a participation by such Lender or participant to such other
corporation provided such transferee agrees in writing to be bound by this
provision; or (vii) in accordance with Section 12.3(h) herein.
SECTION 12.17. Subordination of Intercompany Advances.
(a) Each Credit Party hereby agrees that any Indebtedness
or other intercompany receivables or advances of any other Credit Party,
directly or indirectly, in favor of such Credit Party of whatever nature at any
time outstanding shall be completely subordinate in right of payment to the
prior payment in full of the Obligations, and that no payment on any such
Indebtedness shall be made (i) except intercompany receivables and advances
permitted pursuant to the terms hereof may be repaid
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in the ordinary course of business so long as no Default or Event of Default,
shall have occurred and be continuing and (ii) except as specifically consented
to by all the Lenders in writing, until the prior payment in full of all
Obligations and termination of the Commitment.
(b) In the event that any payment or any such
Indebtedness shall be received by such Credit Party other than as permitted by
Section 12.17(a) before payment in full of all Obligations and termination of
the Commitment, such Credit Party shall receive such payments and hold the same
in trust for, and shall immediately pay over to, the Agent on behalf of the
Lenders all such sums to the extent necessary so that the Lenders shall have
been paid all Obligations owed or which may become owing.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and the year first written.
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BORROWER:
ORION PICTURES CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: President & Chief
Executive Officer
GUARANTORS:
BRIGHTON PRODUCTIONS, INC.
▇▇▇▇▇▇▇▇▇▇▇ MUSIC LIMITED
▇▇▇▇▇ MUSIC PUBLICATIONS
F.P. PRODUCTIONS
MUSICWAYS, INC.
OPC MUSIC PUBLISHING, INC.
ORION HOME ENTERTAINMENT
CORPORATION
ORION MUSIC PUBLISHING, INC.
ORION PICTURES DISTRIBUTION
(CANADA) INC.
ORION PICTURES DISTRIBUTION
CORPORATION
ORION PRODUCTIONS, INC.
ORION TV PRODUCTIONS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: President & Chief
Executive Officer
As Authorized Signature of
Each of the Foregoing
MCEG STERLING ENTERTAINMENT
MCEG STERLING PRODUCTIONS
MCEG STERLING DEVELOPMENT
MCEG STERLING COMPUTER
SERVICES
167
MCEG STERLING ADMINISTRATIONS
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: President & Chief
Executive Officer
As Authorized Signature of
Each of the Foregoing
LENDERS:
CHEMICAL BANK
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇ III
Title: Managing Director
168
AMSOUTH BANK OF ALABAMA
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
169
THE BANK OF CALIFORNIA, N.A.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President/Manager
170
THE BANK OF NEW YORK
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
171
BANQUE FRANCAISE DU COMMERCE
EXTERIEUR
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: First Vice President and
Regional Manager
By: /s/ ▇▇▇▇▇ ▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Assistant Vice President
172
DE NATIONALE INVESTERINGSBANK, N.V.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: General Manager
By: /s/ ▇▇▇▇ van't Hoenderdaal
-----------------------------
Name: ▇▇▇▇ van't Hoenderaal
Title: Senior Account Manager
173
THE FIRST NATIONAL BANK OF BOSTON
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director
174
IMPERIAL BANK
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Title: Assistant Vice President
175
PILGRIM PRIME RATE TRUST
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant Portfolio
Manager
176
PRIME INCOME TRUST
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
177
PROTECTIVE LIFE INSURANCE
COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇ CFA
Title: Principal Protective
Asset Management Co.
178
THE SUMITOMO TRUST & BANKING
CO., LTD., NEW YORK BRANCH
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
Manager, Corporate
Finance Dept.
179
VAN ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PRIME RATE
INCOME TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President -
Portfolio Manager
180
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
181
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING RATE
FUND, INC.
By: /s/ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Authorized Signatory
182
▇▇▇▇▇▇▇ ▇▇▇▇▇ PRIME RATE PORTFOLIO
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Asset Management,
L.P., as Investment Advisor
By: /s/ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Authorized Signatory
183
EXHIBIT A-1
FORM OF REVOLVING CREDIT NOTE
$ New York, New York
as of November 1, 1995
FOR VALUE RECEIVED, ORION PICTURES CORPORATION, A Delaware
corporation (the "Obligor"), DOES HEREBY PROMISE TO PAY to the order of [INSERT
NAME OF LENDER] (the "Lender") at the office of Chemical Bank at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, ▇▇ lawful money of the United States of
America in immediately available funds, the principal amount of ________
DOLLARS ($______), or the aggregate unpaid principal amount of all Revolving
Credit Loans (as defined in the Credit Agreement referred to below) made by the
Lender to the Obligor pursuant to said Credit Agreement, whichever is less, on
such date or dates as is required by said Credit Agreement, and to pay interest
on the unpaid principal amount from time to time outstanding hereunder, in like
money, at such office and at such times as set forth in Section 2.15 of said
Credit Agreement.
The Obligor and any and all sureties, guarantors and endorsers
of this Note and all other parties now or hereafter liable hereon severally
waive grace, demand, presentment for payment, protest, notice of any kind
(including, but not limited to, notice of dishonor, notice of protest, notice
of intention to accelerate or notice of acceleration) and diligence in
collecting and bringing suit against any party hereto and agree to the extent
permitted by applicable law (i) to all extensions and partial payments, with or
without notice, before or after maturity, (ii) to any substitution, exchange or
release of any security now or hereafter given for this Note, (iii) to the
release of any party primarily or secondarily liable hereon, and (iv) that it
will not be necessary for any holder of this Note, in order to enforce payment
of this Note, to first institute or exhaust such holder's remedies against the
Obligor or any other party liable hereon or against any security for this Note.
The
184
nonexercise by the holder of any of its rights hereunder in any particular
instance shall not constitute a waiver thereof in that or any subsequent
instance.
This Note is one of the Revolving Credit Notes referred to in
that certain Credit, Security and Guaranty Agreement dated as of November 1,
1995 (as the same may be amended, supplemented or otherwise modified, renewed
or replaced from time to time, the "Credit Agreement"), among the Obligor, the
Guarantors referred to therein, the Lenders referred to therein and Chemical
Bank as Agent and as Issuing Bank, and is entitled to the benefits of, and is
secured by the security interests granted in the Credit Agreement and the other
security documents and guarantees referred to and described therein, which
among other things, contains provisions for optional and mandatory prepayment
and for acceleration of the maturity hereof upon the occurrence of certain
events, all as provided in the Credit Agreement.
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
ORION PICTURES CORPORATION
By:
-----------------------------
Name:
Title:
185
[LAST PAGE OF NOTE]
Unpaid Name of
Principal Person
Payments Balance Making
Date Amount of Loan Principal Interest of Note Notation
---- -------------- --------- -------- --------- --------
186
EXHIBIT A-2
FORM OF TERM NOTE
$__________ New York, New York
as of November 1, 1995
FOR VALUE RECEIVED, ORION PICTURES CORPORATION, a Delaware
corporation (the "Obligor"), DOES HEREBY PROMISE TO PAY to the order of [INSERT
NAME OF LENDER] (the "Lender") at the office of Chemical Bank at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, ▇▇ lawful money of the United States of
America in immediately available funds, the principal amount of ___________
DOLLARS ($__________), or such lesser amount as shall then constitute the
Lender's percentage of the Term Loan (as defined in the Credit Agreement
referred to below) made by the Lender to the Obligor pursuant to said Credit
Agreement, on such date or dates as is required by said Credit Agreement, and
to pay interest on the unpaid principal amount from time to time outstanding
hereunder, in like money, at such office, as set forth in Section 2.15 of said
Credit Agreement.
The Obligor and any and all sureties, guarantors and endorsers
of this Note and all other parties now or hereafter liable hereon severally
waive grace, demand, presentment for payment, protest, notice of any kind
(including, but not limited to, notice of dishonor, notice of protest, notice
of intention to accelerate or notice of acceleration) and diligence in
collecting and bringing suit against any party hereto and agree to the extent
permitted by applicable law (i) to all extensions and partial payments, with or
without notice, before or after maturity, (ii) to any substitution, exchange or
release of any security now or hereafter given for this Note, (iii) to the
release of any party primarily or secondarily liable hereon, and (iv) that it
will not be necessary for any holder of this Note, in order to enforce payment
of this Note, to first institute or exhaust such holder's remedies against the
Obligor or any other party liable therefor or against any security for this
Note. The
187
nonexercise by the holder of any of its rights hereunder in any particular
instance shall not constitute a waiver thereof in that or any subsequent
instance.
This Note is one of the Term Notes referred to in that certain
Credit, Security and Guaranty Agreement dated as of November 1, 1995 (as the
same may be amended, supplemented or otherwise modified, renewed or replaced
from time to time, the "Credit Agreement"), among the Obligor, the Corporate
Guarantors referred to therein, the Lenders referred to therein, and Chemical
Bank as Agent and as Fronting Bank, and is entitled to the benefits of and is
secured by the security interests granted in the Credit Agreement and the other
security documents referred to and described therein, which among other things
contains provisions for optional and mandatory prepayment, and for acceleration
of the maturity hereof upon the occurrence of certain events, all as provided
in the Credit Agreement.
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
ORION PICTURES CORPORATION
By ____________________________
Name:
Title:
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188
[LAST PAGE OF NOTE]
Unpaid Name of
Principal Person
Payments Balance Making
Date Amount of Loan Principal Interest of Note Notation
---- -------------- --------- -------- --------- --------
189
EXHIBIT B-1
FORM OF COPYRIGHT SECURITY AGREEMENT
WHEREAS, Orion Pictures Corporation, a Delaware corporation
("Parent") and each Subsidiary of Parent whose name appears at the foot hereof
(collectively the "Grantors") hold certain copyrights and rights under
copyright with respect to certain movies-of-the-week, television series, motion
pictures, films, videotapes or other programs produced for television release
or for release in any other medium, shown on network, free and cable, pay
and/or other television medium (including, without limitation, first-run
syndication) in each case whether recorded on film, videotape, cassette,
cartridge, disc or on or by any other means, method, process or device whether
now owned or hereafter developed, including, without limitation, those United
States copyright registrations listed on Schedule 1 hereto (the "Product");
WHEREAS, the Grantors are parties to a Credit, Security and
Guaranty Agreement dated as of November 1, 1995, as the same may be amended,
supplemented or otherwise modified, renewed or replaced from time to time be
amended (the "Credit Agreement"), among the Grantors, the Lenders named therein
(the "Lenders"), and Chemical Bank as Agent and as Issuing Bank;
WHEREAS, pursuant to the terms of the Credit Agreement, the
Grantors granted to the Agent (for the benefit of the Lenders) a security
interest in all of the personal property of the Grantors including all right,
title and interest of the Grantors in, to and under any copyright or copyright
license whether now existing or hereafter arising or acquired, and all proceeds
thereof to secure the payment of the Obligations (as such term is defined in
the Credit Agreement);
NOW THEREFORE, for good and valuable consideration the receipt
and sufficiency of which is hereby acknowledged, Grantors do, as security for
the Obligations, hereby grant to the Agent (for the benefit of the Lenders) a
continuing security interest in all the Grantors' right, title and interest in
and to each and every item of Product, the scenario, screenplay or script upon
190
which an item of Product is based, all of the properties thereof, tangible and
intangible, and all domestic and foreign copyrights and all other rights
therein and thereto, of every kind and character, whether now in existence or
hereafter to be made or produced, and whether or not in possession of such
Grantors, including with respect to each and every item of Product and without
limiting the foregoing language, each and all of the following particular
rights and properties (to the extent they are owned or hereafter created or
acquired by Grantors):
(i) all scenarios, screenplays and/or scripts at
every stage thereof;
(ii) all common law and/or statutory copyright and
other rights in all literary and other properties (hereinafter
called "said literary properties") which form the basis of the
item of Product and/or which are or will be incorporated into
the item of Product, all component parts of the item of
Product consisting of said literary and other properties, all
motion picture rights in and to the story, all treatments of
said story and other literary material, together with all
preliminary and final screenplays used and to be used in
connection with the item of Product, and all other literary
material upon which the item of Product is based or from which
it is adapted;
(iii) all motion picture rights in and to all music
and musical compositions used and to be used in the item of
Product, including, without limitation, all rights to record,
rerecord, produce, reproduce or synchronize all of said music
and musical compositions in and in connection with motion
pictures;
(iv) all tangible personal property relating to
each item of Product, including, without limitation, all
exposed film, developed film, positives, negatives, prints,
positive prints, answer prints, special effects, preparing
materials (including interpositives, duplicate negatives,
internegatives, color reversals, intermediates, lavenders,
fine grain master prints and matrices, and all other forms of
pre-print elements), sound tracks, cutouts, trims and any and
all other
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physical properties of every kind and nature relating to such
item of Product, whether in completed form or in some state of
completion, and all masters, duplicates, drafts, versions,
variations and copies of each thereof, in all formats whether
on film, videotape, disk or otherwise and all music sheets and
promotional materials relating to such item of Product
(collectively, the "Physical Materials");
(v) all collateral, allied, subsidiary and
merchandising rights appurtenant or related to each item of
Product including, without limitation, the following rights:
all rights to produce remakes or sequels to each item of
Product based upon each item of Product, said literary
properties or the theme of each item of Product and/or the
text or any part of said literary properties; all rights
throughout the world to broadcast, transmit and/or reproduce
by means of television (including commercially sponsored,
sustaining and subscription or "pay" television) or by any
process analogous thereto, now known or hereafter devised,
each item of Product or any remake or sequel to such item of
Product; all rights to produce primarily for television or
similar use a motion picture or series of motion pictures, by
use of film or any other mechanical recording device now known
or hereafter devised, based upon each item of Product, said
literary properties or any part thereof, including, without
limitation, all properties based upon any script, scenario or
the like used in each item of Product; all merchandising
rights including, without limitation, all rights to use,
exploit and license others to use and exploit any and all
commercial tieups of any kind arising out of or connected with
said literary properties, each item of Product, the title or
titles of each item of Product, the characters of each item of
Product or said literary properties and/or the names or
characteristics of said characters and including further,
without limitation, any and all commercial exploitation in
connection with or related to each item of Product, any remake
or sequel thereof and/or said literary properties;
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192
(vi) all statutory copyrights, domestic and
foreign, obtained or to be obtained on the initial item of
Product, together with any and all copyrights obtained or to
be obtained in connection with each item of Product or any
underlying or component elements of such item of Product,
including, without limitation, all copyrights on the property
described in subparagraphs (i) through (v) inclusive, of this
paragraph, together with the right to copyright and all rights
to renew or extend such copyrights and the right to sue for
past, present and future infringements of copyright;
(vii) all insurance policies connected with each
item of Product and all proceeds which may be derived
therefrom;
(viii) all rights to distribute, sell, rent,
license the exhibition of and otherwise exploit and turn to
account each item of Product, the negatives, sound tracks,
prints and motion picture rights in and to said story, other
literary material upon which each item of Product is based or
from which it is adapted, and said music and musical
compositions used or to be used in each item of Product;
(ix) any and all sums, proceeds, money, products,
profits or increases, including money profits or increases (as
those terms are used in the New York Uniform Commercial Code
(the "UCC") or otherwise) or other property obtained or to be
obtained from the distribution, exhibition, sale or other uses
or dispositions of each item of Product or any part of each
item of Product, including, without limitation, all proceeds,
profits, products and increases, whether in money or
otherwise, from the sale, rental or licensing of each item of
Product and/or any of the elements of each item of Product
including from collateral, allied, subsidiary and
merchandising rights;
(x) the dramatic, nondramatic, stage, television,
radio and publishing rights, title and
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193
interest in and to each item of Product, and the right to
obtain copyrights and renewals of copyrights therein;
(xi) the title of each item of Product and all
rights of such Grantor to the use thereof, including, without
limitation, rights protected pursuant to trademark, service
mark, unfair competition and/or the rules and principles of
law and of any other applicable statutory, common law, or
other rule or principle of law;
(xii) any and all contract rights and/or chattel
paper which may arise in connection with each item of Product;
(xiii) all accounts and/or other rights to payment
which such Grantor presently owns or which may arise in favor
of such Grantor in the future, including, without limitation,
any refund under a completion guaranty, all accounts and/or
rights to payment due from exhibitors in connection with the
distribution of each item of Product, and from exploitation of
any and all of the collateral, allied, subsidiary,
merchandising and other rights in connection with each item of
Product;
(xiv) any and all "general intangibles" (as that
term is defined in the UCC) not elsewhere included in this
definition, including, without limitation, any and all general
intangibles consisting of any right to payment which may arise
in the distribution or exploitation of any of the rights set
out herein, and any and all general intangible rights in favor
of such Grantor or the Lenders for services or other
performances by any third parties, including actors, writers,
directors, individual producers and/or any and all other
performing or nonperforming artists in any way connected with
each item of Product, any and all general intangible rights in
favor of such Grantor or the Lenders relating to licenses of
sound or other equipment, licenses for photographic or other
process, and all general intangibles related to the
distribution
- 5 -
194
or exploitation of each item of Product including general
intangibles related to or which grow out of the exhibition of
each item of Product and the exploitation of any and all other
rights in each item of Product set out in this definition;
(xv) any and all goods including inventory (as
that term is defined in the UCC) which may arise in
connection with the creation, production or delivery of each
item of Product and which goods pursuant to any production or
distribution agreement or otherwise are owned by such Grantor;
(xvi) all and each of the rights, regardless of
denomination, which arise in connection with the creation,
production, completion of production, delivery, distribution,
or other exploitation of each item of Product, including,
without limitation, any and all rights in favor of such
Grantor, the ownership or control of which are or may become
necessary in the opinion of the Agent, in order to complete
production of each item of Product in the event that the Agent
exercises any rights it may have to take over and complete
production of each item of Product;
(xvii) any and all documents issued by any
pledgeholder or bailee with respect to each item of Product,
the negatives, sound tracks or prints (whether or not in
completed form) with respect thereto;
(xviii) any and all production accounts or other
bank accounts established by such Grantor with respect to such
item of Product;
(xix) any and all rights of such Grantor under
contracts relating to the production of each item of Product;
and
(xx) any and all rights of such Grantor under any
agreement entered into by such Grantor pursuant to which such
Grantor has licensed, leased, assigned or sold distribution or
other exploitation rights to any
- 6 -
195
item of Product in any media or territory to an unaffiliated
person.
Each of the Grantors agrees that if any person, firm or
corporation shall do or perform any acts which the Agent believes constitute a
copyright infringement of the photoplay or of any of the literary, dramatic or
musical material contained in the Product, or constitute a plagiarism, or
violate or infringe any right of any Grantor or the Lenders therein or if any
person, firm or corporation shall do or perform any acts which the Agent
believes constitute an unauthorized or unlawful distribution, exhibition, or
use thereof, then and in any such event, upon 30 days' prior written notice to
such Grantor, while an Event of Default is continuing, the Agent may and shall
have the right to take such steps and institute such suits or proceedings as
the Agent may deem advisable or necessary to prevent such acts and conduct and
to secure damages and other relief by reason thereof, and to generally take
such steps as may be advisable or necessary or proper for the full protection
of the rights of the parties. The Agent may take such steps or institute such
suits or proceedings in its own name or in the name of such Grantor or in the
names of the parties jointly.
This Copyright Security Agreement is made for collateral
purposes only. This security interest is granted in conjunction with the
security interests granted to the Agent (for the benefit of the Lenders)
pursuant to the Credit Agreement. The parties do hereby further acknowledge
and affirm that the rights and remedies of the Agent (for the benefit of the
Lenders) with respect to the security interest made and granted hereby are more
fully set forth in the Credit Agreement, and are subject to the limitations
(including certain rights of quiet enjoyment in favor of licensees) set forth
in the Credit Agreement, the terms and provisions of which are incorporated by
reference herein as if fully set forth herein.
THIS COPYRIGHT SECURITY AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
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196
IN WITNESS WHEREOF, the Grantors have caused this Copyright
Security Agreement to be duly executed by its officer thereunto duly authorized
as of November 1, 1995.
ORION PICTURES CORPORATION
BRIGHTON PRODUCTIONS, INC.
▇▇▇▇▇▇▇▇▇▇▇ MUSIC LIMITED
▇▇▇▇▇ MUSIC PUBLICATIONS
F.P. PRODUCTIONS
MUSICWAYS, INC.
OPC MUSIC PUBLISHING, INC.
ORION HOME ENTERTAINMENT
CORPORATION
ORION MUSIC PUBLISHING, INC.
ORION PICTURES DISTRIBUTION
(CANADA) INC.
ORION PICTURES DISTRIBUTION
CORPORATION
ORION PRODUCTIONS, INC.
ORION TV PRODUCTIONS, INC.
By _____________________________
Name:
Title:
Address: 1888 Century Park East
Los Angeles, CA 90067
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197
MCEG STERLING ENTERTAINMENT
MCEG STERLING PRODUCTIONS
MCEG STERLING DEVELOPMENT
MCEG STERLING COMPUTER SERVICES
MCEG STERLING ADMINISTRATIONS
By _____________________________
Name:
Title:
Address: 1888 Century Park East
Los Angeles, CA 90067
Accepted:
CHEMICAL BANK, individually
and as Agent
By:_______________________
Name:
Title:
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198
STATE OF )
: ss.:
COUNTY OF )
On the ____ day of __________, in the year 1995, before me personally
came _____________________, to me known, who, being by me sworn, did say that
he resides at ________________________; that he is an Authorized Signatory of
Orion Pictures Corporation, Brighton Productions, Inc., ▇▇▇▇▇▇▇▇▇▇▇ Music
Limited, ▇▇▇▇▇ Music Publications, F.P. Productions, Musicways, Inc., OPC Music
Publishing, Inc., Orion Home Entertainment Corporation, Orion Music Publishing,
Inc., Orion Pictures Distribution (Canada) Inc., Orion Pictures Distribution
Corporation, Orion Productions, Inc. and Orion TV Productions, Inc., which
corporations are described in, and which corporations executed the above
instrument, and that he signed his name by order of the Board of Directors of
each of said corporations.
___________________________________
Notary Public
199
STATE OF )
: ss.:
COUNTY OF )
On the ____ day of __________, in the year 1995, before me personally
came _____________________, to me known, who, being by me sworn, did say that
he resides at ________________________; that he is an Authorized Signatory of
MCEG Sterling Entertainment, MCEG Sterling Productions, MCEG Sterling
Development, MCEG Sterling Computer Services and MCEG Sterling Administrations,
which corporations are described in, and which corporations executed the above
instrument, and that he signed his name by order of the Board of Directors of
each of said corporations.
___________________________________
Notary Public
200
SCHEDULE 1 to Copyright
Security Agreement
Title Registration No. Date of Registration
----- ---------------- --------------------
201
EXHIBIT B-2
FORM OF
SUPPLEMENT NO. __ TO THE COPYRIGHT SECURITY
AGREEMENT DATED AS OF NOVEMBER 1, 1995
WHEREAS, ORION PICTURES CORPORATION, a Delaware corporation
(the "Grantor") is party to a Credit, Security and Guaranty Agreement dated as
of November 1, 1995 (as such agreement may be amended, supplemented or
otherwise modified, renewed or replaced from time to time, the "Credit
Agreement") among the Grantor, the Corporate Guarantors referred to therein,
the Lenders referred to therein and Chemical Bank as Agent and as Issuing Bank;
WHEREAS, pursuant to the terms of the Credit Agreement, the
Grantor has granted to the Agent (for the benefit of the Lenders) a security
interest in all right, title and interest of the Grantor in and to all personal
property, whether now owned, presently existing or hereafter acquired or
created, including, without limitation, all right, title and interest of the
Grantor in, to and under any item of Product being used herein as defined in the
Copyright Security Agreement referred to below) and any copyright or copyright
license, whether now existing or hereafter arising, acquired or created, and all
proceeds thereof or income therefrom, to secure the payment and performance of
the Obligations (such term being used herein as defined in the Credit Agreement)
pursuant to the Credit Agreement;
WHEREAS, the Grantor is a party to a Copyright Security
Agreement, dated as of November 1, 1995 (as the same has been, or may hereafter
be, amended or supplemented from time to time, the "Copyright Security
Agreement"), pursuant to which the Grantor has granted to the Agent (for the
benefit of the Lenders), as security for the Obligations, a continuing security
interest in all of the Grantor's right, title and interest in and to all
personal property, tangible and intangible, wherever located or situated and
whether now owned, presently existing or hereafter
202
acquired or created, including but not limited to, all goods, accounts,
instruments, intercompany obligations, contract rights, documents, chattel
paper, general intangibles, equipment, machinery, inventory, copyrights,
trademarks, trade names, insurance proceeds, cash, bank accounts and the
securities pledged to the Agent (for the benefit of the Lenders) pursuant to the
Credit Agreement, and any proceeds thereof or income therefrom, further
including but not limited to, all of the Grantor's right, title and interest in
and to each and every item of Product the scenario, screenplay or script upon
which an item of Product is based, all of the properties thereof, tangible and
intangible, and all domestic and foreign copyrights and all other rights therein
and thereto, of every kind and character, whether now in existence or hereafter
to be made or produced, and whether or not in possession of the Grantor, all as
more fully set forth in the Copyright Security Agreement;
WHEREAS, the Grantor has acquired or created additional items
of Product since the date of execution of the Copyright Security Agreement and
the most recent Supplement thereto and holds certain additional copyrights and
rights under copyright with respect to items of Product;
WHEREAS, Schedule 1 to the Copyright Security Agreement does
not reflect (i) item(s) of Product acquired or created by the Grantor since the
date of execution of the Copyright Security Agreement and the most recent
Supplement thereto or (ii) all the copyrights and rights under copyright held
by the Grantor;
THEREFORE,
A. The Grantor does hereby grant to the Agent (for the
benefit of the Lenders), as security, a continuing security interest
in and to all of the Grantor's right, title and interest in and to
each and every item of Product being added to Schedule 1 to the
Copyright Security Agreement pursuant to paragraph (b) below, the
scenario, screenplay or script upon which such item of Product is
based, all of the properties thereof, tangible and intangible, and all
domestic and foreign copyrights and all other rights therein and
thereto, of every kind and character, whether now in existence or
hereafter to be made or produced, and whether or not in possession of
the
2
203
Grantor, all as contemplated by, and as more fully set forth in, the
Copyright Security Agreement.
B. Schedule 1 to the Copyright Security Agreement is
hereby supplemented, effective as of the date hereof, so as to reflect
all of the copyrights and rights under copyright with respect to the
item(s) of Product in and to which the Grantor has granted a
continuing security interest to the Agent (for the benefit of the
Lenders) pursuant to the terms of the Copyright Security Agreement and
the Credit Agreement. The following item(s) of Product and copyright
information are hereby added to Schedule 1 to the Copyright Security
Agreement:
3
204
Date of
Title Registration No. Registration
----- ---------------- ------------
Except as expressly supplemented hereby, the Copyright
Security Agreement shall continue in full force and effect in accordance with
the provisions thereof on the date hereof. As used in the Copyright Security
Agreement, the terms "Agreement", "this Agreement", "this Copyright Security
Agreement", "herein", "hereafter", "hereto", "hereof" and words of similar
import, shall, unless the context otherwise requires, mean the Copyright
Security Agreement as supplemented by this Supplement.
Except as expressly supplemented hereby, the Copyright
Security Agreement, all documents contemplated thereby and any previously
executed Supplements thereto, are each hereby confirmed and ratified by the
Grantor.
The execution and filing of this Supplement, and the addition
of the item(s) of Product set forth herein to Schedule 1 to the Copyright
Security Agreement are not intended by the parties to derogate from, or
extinguish, any of the Agent's rights or remedies under (i) the Copyright
Security Agreement and/or any agreement, amendment or supplement thereto or any
other instrument executed by the Grantor and heretofore recorded or submitted
for recording in the U.S. Copyright Office or (ii) any financing statement,
continuation statement, deed or charge or other instrument executed by the
Grantor and heretofore filed in any state or country in the United States of
America or elsewhere.
4
205
IN WITNESS WHEREOF, the Grantor has caused this Supplement No.
___ to the Copyright Security Agreement to be duly executed by its duly
authorized officer as of _____________, ____.
ORION PICTURES CORPORATION
By:__________________________
Name:
Title:
5
206
STATE OF ______________ )
: ss.:
COUNTY OF _____________ )
On this the ___ day of __________, ____, before me,
________________________________, the undersigned Notary Public, personally
appeared _________________________________________,
[ ] personally known to me,
[ ] proved to me on the basis of satisfactory evidence, to be
the _________________________ of the corporation known as Orion Pictures
Corporation who executed the foregoing instrument on behalf of the corporation,
and acknowledged that such corporation executed it pursuant to a resolution of
its Board of Directors.
WITNESS my hand and official seal.
______________________________
Notary Public
6
207
EXHIBIT C-1
FORM OF PLEDGEHOLDER AGREEMENT (UNCOMPLETED PRODUCT)
AGREEMENT dated as of ________________,
____ (the "Agreement") among (i) [INSERT NAME OF
LABORATORY] (ii) [INSERT NAME OF EACH CREDIT
PARTY WHO HAS CONTROL OVER THE PHYSICAL ELEMENTS
OF THE COLLATERAL] (collectively referred to
herein as the "Producer(s)"), (iii) [INSERT NAME
OF COMPLETION GUARANTOR] (the "Completion
Guarantor") and (iv) Chemical Bank, as agent for
the Lenders referred to in the Credit Agreement
hereinafter defined (the "Agent").
Pursuant to the Credit, Security and Guaranty Agreement dated
as of November 1, 1995, among Orion Pictures Corporation (the "Borrower"), the
guarantors referred to therein, the lenders referred to therein (the "Lenders")
and the Agent (as the same may be amended, supplemented or otherwise modified,
renewed or replaced from time to time, the "Credit Agreement"), the Lenders
have agreed, subject to the terms and conditions set forth in the Credit
Agreement, to make loans to the Borrower in connection with, among other
things, the acquisition, production and distribution of the Product (as
hereinafter defined); and the Producer(s) have granted to the Agent for the
benefit of the Lenders a security interest in, among other things, all of their
right, title and interest in and to the [DESCRIBE NATURE OF PRODUCT, I.E.
THEATRICAL MOTION PICTURE, MOVIE-OF-THE-WEEK, ETC.] currently entitled "[INSERT
THE NAME OF THE PRODUCT]" (hereinafter called the "Product") as security for
various obligations of the Producer(s) to the Lenders. Such security interest
covers, among other things, all physical properties of every kind or nature of,
or relating to, the Product and all versions thereof, including, without
limitation, exposed film, developed film, positives, negatives, prints,
positive prints,
208
answer prints, special effects, preparing materials (including interpositives,
duplicate negatives, internegatives, color reversals, intermediates, lavenders,
fine grain master prints and matrices, and all other forms of pre-print
elements), sound tracks, cutouts, trims and any and all other physical
properties of every kind and nature of, or relating to, the Product, whether in
completed form or in some state of completion, and all masters, duplicates,
drafts, versions, variations and copies of each thereof, in all formats whether
on film, videotape, disk or otherwise and all music sheets and promotional
materials relating to the Product all of the foregoing items being hereinafter
collectively called the "Collateral".
Pursuant to the Completion Guaranty dated as of [_________],
199[_] among the Completion Guarantor, the Producer(s) and the Agent (the
"Completion Guaranty"), the Completion Guarantor has agreed to guaranty the
completion and delivery of the Product. In connection therewith, the
Producer(s) have granted to the Completion Guarantor, a security interest in
certain assets that are included in the Collateral, all as specified in, and
subject to the terms and conditions of, the Producer's Completion Agreement
dated as of [____________], 199[_] between the Producer(s) and the Completion
Guarantor (the "Producer's Agreement").
From time to time, the Laboratory will have in its possession
certain items of the Collateral.
Accordingly, the parties hereto hereby agree as follows:
1. Each of the Producer(s), the Completion Guarantor,
and the Agent hereby appoint the Laboratory as the pledgeholder of all items of
Collateral that may from time to time come into the possession or control of
the Laboratory. The Laboratory agrees to hold all such items of Collateral as
pledgeholder for the Agent (for the benefit of the Lenders) subject to the
following terms and conditions:
a. Except as permitted by Section 1(b) below,
the Laboratory will keep all items of Collateral at the
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209
laboratories or storage facilities listed on Schedule 1
hereto, and will not deliver such property to anyone.
b. Subject to the provisions of Sections 1(c)
and 1(d) below, the Laboratory will permit the Producers:
i) to have access to the negatives and
other pre-print material of the Product (but not
remove them from the possession of the Laboratory)
for purposes of inspecting, cutting, scoring or
similar purposes;
ii) to obtain a reasonable number of
positive prints including without limitation,
dailies, for the purposes of editing and previewing
the Product;
iii) to direct the making of pre-print
material and positive prints of the Product and
trailers thereof and the delivery thereof to the
Producers or distributors, licensees or other parties
as the Producers may direct;
iv) to remove reasonable amounts of
material for processing by optical and/or sound
houses which agree in writing to be bound by the
terms hereof or enter into a separate laboratory
pledgeholder agreement substantially in the form
hereof, and to return such materials when processed
to the Laboratory;
v) with the prior written consent of
the Agent, to forward any item of Collateral to
another laboratory. The Agent hereby consents to the
Laboratory's forwarding original material or elements
constituting Collateral, if requested to do so by the
Producer(s) [OR THE COMPLETION GUARANTOR], to any of
the laboratories listed in Schedule 3 hereto. The
Agent's consent contained in this clause (v) may be
revoked at any time by written notice to the
Laboratory [,THE COMPLETION
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GUARANTOR] and the Producers from the Agent. In
addition, such consent shall be deemed to be revoked
at any time upon receipt by the Laboratory of written
notice from the Agent, that an Event of Default has
occurred under the Credit Agreement; and
vi) to forward any of the
above-mentioned property to another laboratory,
approved by the Agent, if the Agent has previously
received a Pledgeholder Agreement executed by such
laboratory.
c. If and when the Laboratory shall receive written
notice from the Agent that an Event of Default shall have
occurred under the Credit Agreement, the Laboratory shall take
no further orders from the Producers and will hold all items
of Collateral within its possession or under its control as
pledgeholder hereunder, subject only (i) to the order and
instruction of the Agent; and (ii) to the rights of the Agent,
and/or the Completion Guarantor to have access to and/or
delivery of items referred to in Section 6 below.
d. If and when the Laboratory shall receive
written notice from the Completion Guarantor that the
Completion Guarantor has exercised its right to take over the
production of the Product under the Producer's Agreement and,
unless and until the Laboratory shall have received written
notice from the Agent to the contrary, the Laboratory shall
allow the Completion Guarantor to exercise the rights set
forth in clauses (i), (ii), (iii) and (iv) of Section 1(b)
hereof. Following such notice from the Completion Guarantor,
the Laboratory will not permit the Producer(s) to have any
further access to, or direct any further actions to be taken
with respect to, the Collateral in the Laboratory's possession
or under its control or to obtain any prints thereof.
-4-
211
e. If the Completion Guarantor takes over the
production of the Product and requests that the Collateral be
moved to a different laboratory, the Agent agrees to consent
to such move so long as a laboratory pledgeholder agreement is
executed by the various parties hereto (other than the
Laboratory) and by the replacement laboratory, substantially
in the form hereof and so as long as the replacement
laboratory is reasonably satisfactory to the Agent.
2. The Producer(s) agree with the Agent that during
production of the Product they will deliver the daily rushes for the Product to
the Laboratory as soon as practicable and will use their best efforts to
deliver the daily rushes on a weekly basis.
3. The Laboratory shall keep the original negatives of
the Product in film vaults separate from and at a reasonable distance from
protective duplicating materials (whether protective masters, fine grains,
duplicate negatives or otherwise) to afford protection against any loss or
damage, whether by fire or other disaster or otherwise. The Laboratory shall
keep the Agent and the Completion Guarantor advised in writing of the actual
location of the film vaults where all items of the Collateral are kept,
including information as to the separate film vaults utilized for the original
negatives and protective materials as aforesaid.
4. Subject to the rights of the Completion Guarantor,
the Laboratory agrees that in its capacity as pledgeholder it is holding and
has possession of the Collateral and the physical properties thereof
constructively for the Agent (for the benefit of the Lenders) and upon written
request of the Agent (a copy of which will be sent to the Completion Guarantor
unless its rights hereunder have terminated as contemplated by Section 8
hereof), will hold a sale or sales of the Collateral or any part thereof in
accordance with the direction and instruction of the Agent, at the expense of
the Agent, or in the alternative will cause to be delivered or made available
to the Agent or its nominee (in all cases, pursuant to written instructions
from the Agent) the Collateral and all physical properties thereof in the
possession of the Laboratory or under its control for the purpose of enabling
the Agent to deal with the same pursuant to the Credit
-5-
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Agreement. Nothing herein contained shall be construed to waive any rights of
the Laboratory as specified under Section 9 hereof.
5. Each of the Completion Guarantor and the Producer(s)
hereby waives any claim for damages or otherwise which it may have against the
Laboratory for any acts which the Laboratory may take as pledgeholder, pursuant
to the direction of the Agent.
6. Subject to Section 9 hereof, the Laboratory agrees
that, despite the existence of any other claim which the Laboratory may have
against the Producer(s) and/or the Completion Guarantor and/or any third-party
distributor of the Product, the Laboratory shall accept and fulfill orders for
laboratory work and any other material which may be required by the Agent or
any other third-party distributor of the Product, subject to satisfactory
credit arrangements being made with the Laboratory with respect to any charges
incurred on behalf of the Agent or any such third-party distributor, and the
Laboratory will not assert any claim or lien, statutory or otherwise, against
the Agent or against the Product (except as set forth in Section 9 hereof) with
respect to any charges for laboratory services or materials ordered by the
Producer(s), the designees of the Producer(s), any third-party distributor of
the Product or the Completion Guarantor.
7. The parties hereto agree that the Agent and its
respective designees, successors and assigns shall each be entitled to
unilaterally remove from the Laboratory materials made pursuant to an order
contemplated by Section 6 hereof, which materials shall not be subject to this
Agreement.
8. The rights granted hereunder to the Completion
Guarantor shall (i) at all times be junior and subordinate to the rights
hereunder of the Agent and (ii) terminate upon the completion and delivery of
the Product, unless prior to such completion and delivery of the Product, the
Completion Guarantor has notified the Agent and the Laboratory in writing that
it has or anticipates that it will have to advance its own funds to complete
the Product. Notwithstanding anything to the contrary in this Agreement, the
Completion Guarantor shall have no rights under this Agreement if the Agent
gives written notice to the
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Laboratory and the Completion Guarantor that the Product has been completed and
delivered without the requirement that the Completion Guarantor advance any of
its own funds pursuant to the Completion Guaranty. The Completion Guarantor
hereby agrees that in the event that the Completion Guarantor shall have been
released in writing from all of its obligations under the Completion Guaranty
for the Product, any amendment or termination of this Agreement thereafter
shall not require the Completion Guarantor's consent.
9. The Laboratory shall hold and/or process the
Collateral under its standard terms of business as set forth in Schedule 2
hereto, except that any liens arising in favor of the Laboratory shall be
limited to an aggregate amount of $_______ at any one time outstanding for
processing and/or storing the Collateral and/or materials delivered therefrom
for the Producers, any of their designees and/or the Completion Guarantor.
Except as provided in the prior sentence, the rights of the Laboratory in the
Collateral shall be subordinate and junior to the rights of the Agent and the
Completion Guarantor in respect of the Collateral.
10. The Agent shall promptly give written notice to the
Laboratory when the Agent's (on behalf of the Lenders) security interests in
the Collateral has terminated. Upon receipt of such written notice, the
Laboratory's obligations hereunder as pledgeholder for the Agent shall
terminate.
11. This Agreement shall be binding on and inure to the
benefit of the parties hereto and the successors and assigns of each of the
parties.
12. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
13. No amendment to this Agreement shall be effective
unless in writing and signed by the Producer(s), the Agent and the Laboratory
and if the Laboratory has not received the notice from the Agent contemplated
by Section 8 hereof, then also the Completion Guarantor. This Agreement may be
executed in two or
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214
more counterparts, each of which shall constitute an original, but all of which
when taken together, shall constitute but one instrument, and shall become
effective on the date on which each of the Completion Guarantor and the Agent
shall have received a fully-executed copy of this Agreement. Promptly
thereafter, the Producers shall deliver or mail counterparts of this Agreement
bearing the signature of each of the parties hereto to each party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first written above.
[Laboratory]
By_____________________________
Name:
Title:
Address:
Attn:
ORION PICTURES CORPORATION
By_____________________________
Name:
Title:
Address:
Attn:
[LIST EACH OTHER CREDIT PARTY]
By_____________________________
Name:
Title:
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215
Address:
Attn:
[COMPLETION GUARANTOR]
By_____________________________
Name:
Title:
Address:
Attn:
CHEMICAL BANK, as Agent
By_____________________________
Name:
Title:
Address:
Attn:
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216
Schedule 1
List of Laboratory and Storage Facilities
-10-
217
Schedule 2
[Attach Laboratory's Standard Terms of Business]
-11-
218
Schedule 3
List of Laboratories
California:
Deluxe Laboratories
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(213) 462-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇
Preferred Media, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇ ▇▇▇▇, Facilities Manager
FilmTreat West Corp.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, President
New York:
Preferred Media, Inc.
▇▇▇ ▇. ▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
New Jersey:
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219
Preferred Media, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
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220
EXHIBIT C-2
FORM OF PLEDGEHOLDER AGREEMENT (COMPLETED PRODUCT)
AGREEMENT dated as of _______________,
____ (the "Agreement") among (i) [INSERT NAME OF
LABORATORY] (ii) [INSERT NAME OF EACH CREDIT
PARTY WHO HAS CONTROL OVER THE PHYSICAL ELEMENTS
OF THE COLLATERAL] (collectively referred to
herein as the "Producer(s)"), and (iii) Chemical
Bank, as agent for the Lenders referred to in
the Credit Agreement hereinafter defined (the
"Agent").
Pursuant to the Credit, Security and Guaranty Agreement dated
as of November 1, 1995, among Orion Pictures Corporation (the "Borrower"), the
guarantors referred to therein, the lenders referred to therein (the "Lenders")
and the Agent (as the same may be amended, supplemented or otherwise modified,
renewed or replaced from time to time, the "Credit Agreement"), the Lenders
have agreed, subject to the terms and conditions set forth in the Credit
Agreement, to make loans to the Borrower in connection with, among other
things, the acquisition, production and distribution of the Product (as
hereinafter defined); and the Producer(s) have granted to the Agent for the
benefit of the Lenders a security interest in, among other things, all of their
right, title and interest in and to any motion picture, film or video tape
produced for theatrical, non-theatrical, television or video release in any
other medium, with respect to which the Producer(s) (i) is the initial
copyright owner or (ii) has acquired or has contracted to acquire an equity
interest or distribution rights (hereinafter called the "Product") as security
for various obligations of the Producers to the Lenders. Such security
interest covers, among other things, all physical properties of every kind or
nature of, or relating to, the Product and all versions thereof, including,
without limitation, exposed film, developed film, positives, negatives, prints,
221
positive prints, answer prints, special effects, preparing materials (including
interpositives, duplicate negatives, internegatives, color reversals,
intermediates, lavenders, fine grain master prints and matrices, and all other
forms of pre-print elements), sound tracks, cutouts, trims and any and all
other physical properties of every kind and nature of, or relating to, the
Product, whether in completed form or in some state of completion, and all
masters, duplicates, drafts, versions, variations and copies of each thereof,
in all formats whether on film, videotape, disk or otherwise and all music
sheets and promotional materials relating to the Product, all of the foregoing
items being hereinafter collectively called the "Collateral".
From time to time, the Laboratory will have in its possession
certain items of the Collateral.
Accordingly, the parties hereto hereby agree as follows:
1. Each of the Producer(s) and the Agent hereby appoint
the Laboratory as the pledgeholder of all items of Collateral that may from
time to time come into the possession or control of the Laboratory. The
Laboratory agrees to hold all such items of Collateral as pledgeholder for the
Agent (for the benefit of the Lenders) subject to the following terms and
conditions:
(a) Except as permitted by Section 1(b) below,
the Laboratory will keep all items of Collateral at the
laboratories or storage facilities listed on Schedule 1
hereto, and will not deliver such property to anyone.
(b) Subject to the provisions of Section 1(c) the
Laboratory will permit the Producer(s):
(i) to have access to the negatives and
other pre-print material of the Product (but not
remove them from the possession of the Laboratory)
for purposes of inspecting, cutting, scoring or
similar purposes;
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222
(ii) to obtain a reasonable number of
positive prints including without limitation,
dailies, for the purposes of editing and previewing
the Product;
(iii) to direct the making of pre-print
material and positive prints of the Product and
trailers thereof and the delivery thereof to the
Producers or distributors, licensees or other parties
as the Producer(s) may direct;
(iv) to remove reasonable amounts of
material for processing by optical and/or sound
houses which agree in writing to be bound by the
terms hereof or enter into a separate laboratory
pledgeholder agreement substantially in the form
hereof, and to return such materials when processed
to the Laboratory;
(v) with the prior written consent of
the Agent, to forward any item of Collateral to
another laboratory. The Agent hereby consents to the
Laboratory's forwarding original material or elements
constituting Collateral, if requested to do so by the
Producer(s) to any of the laboratories listed in
Schedule 3 hereto. The Agent's consent contained in
this clause (v) may be revoked at any time by written
notice to the Laboratory and the Producer(s) from the
Agent. In addition, such consent shall be deemed to
be revoked at any time upon receipt by the Laboratory
of written notice from the Agent, that an Event of
Default has occurred under the Credit Agreement; and
(vi) to forward any of the
above-mentioned property to another laboratory,
approved by the Agent, if the Agent has previously
received a Pledgeholder Agreement executed by such
laboratory.
(c) If and when the Laboratory shall receive written
notice from the Agent that an Event of Default shall
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223
have occurred under the Credit Agreement, the Laboratory shall
take no further orders from the Producers and will hold all
items of Collateral within its possession or under its control
as pledgeholder hereunder, subject only (i) to the order and
instruction of the Agent; and (ii) to the rights of the Agent
to have access to and/or delivery of items referred to in
Section 5 below.
2. The Laboratory shall keep the original negatives of
the Product in film vaults separate from and at a reasonable distance from
protective duplicating materials (whether protective masters, fine grains,
duplicate negatives or otherwise) to afford protection against any loss or
damage, whether by fire or other disaster or otherwise. The Laboratory shall
keep the Agent advised in writing of the actual location of the film vaults
where all items of the Collateral are kept, including information as to the
separate film vaults utilized for the original negatives and protective
materials as aforesaid.
3. The Laboratory agrees that in its capacity as
pledgeholder it is holding and has possession of the Collateral and the
physical properties thereof constructively for the Agent (for the benefit of
the Lenders) and upon written request of the Agent, will hold a sale or sales
of the Collateral or any part thereof in accordance with the direction and
instruction of the Agent, at the expense of the Agent, or in the alternative
will cause to be delivered or made available to the Agent or its nominee (in
all cases, pursuant to written instructions from the Agent) the Collateral and
all physical properties thereof in the possession of the Laboratory or under
its control for the purpose of enabling the Agent to deal with the same
pursuant to the Credit Agreement. Nothing herein contained shall be construed
to waive any rights of the Laboratory as specified under Section 7 hereof.
4. Each of the Producers hereby waive any claim for
damages or otherwise which it may have against the Laboratory for any acts
which the Laboratory may take as pledgeholder, pursuant to the direction of the
Agent.
5. Subject to Section 7 hereof, the Laboratory agrees
that, despite the existence of any other claim which the
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224
Laboratory may have against the Producer(s) and/or any third-party distributor
of the Product, the Laboratory shall accept and fulfill orders for laboratory
work and any other material which, following the occurrence and continuation of
an Event of Default, may be required by the Agent or any other third-party
distributor of the Product, subject to satisfactory credit arrangements being
made with the Laboratory with respect to any charges incurred on behalf of the
Agent or any such third-party distributor, and the Laboratory will not assert
any claim or lien, statutory or otherwise, against the Agent or against the
Product (except as set forth in Section 7 hereof) with respect to any charges
for laboratory services or materials ordered by the Producer(s), the designees
of the Producer(s), any third-party distributor of the Product.
6. The parties hereto agree that the Agent and its
respective designees, successors and assigns shall each be entitled to
unilaterally remove from the Laboratory materials made pursuant to an order
contemplated by Section 5 hereof, which materials shall not be subject to this
Agreement.
7. The Laboratory shall hold and/or process the
Collateral under its standard terms of business as set forth in Schedule 2
hereto, except that any liens arising in favor of the Laboratory shall be
limited to an aggregate amount of $______ per any item of Product at any one
time outstanding for processing and/or storing the Collateral and/or materials
delivered therefrom for the Producer(s) and/or any of their designees. Except
as provided in the prior sentence, the rights of the Laboratory in the
Collateral shall be subordinate and junior to the rights of the Agent in
respect of the Collateral.
8. The Agent shall promptly give written notice to the
Laboratory when the Agent's (on behalf of the Lenders) security interests in
the Collateral has terminated. Upon receipt of such written notice, the
Laboratory's obligations hereunder as pledgeholder for the Agent shall
terminate.
9. This Agreement shall be binding on and inure to the
benefit of the parties hereto and the successors and assigns of each of the
parties.
- 5 -
225
10. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
11. No amendment to this Agreement shall be effective
unless in writing and signed by the Producer(s), the Agent and the Laboratory.
This Agreement may be executed in two or more counterparts, each of which shall
constitute an original, but all of which when taken together, shall constitute
but one instrument, and shall become effective on the date on which the Agent
shall have received a fully-executed copy of this Agreement. Promptly
thereafter, the Producer(s) shall deliver or mail counterparts of this
Agreement bearing the signature of each of the parties hereto to each party
hereto.
12. This Agreement shall supersede and replace all
previous Laboratory Pledgeholder Agreements, among the Laboratory, the
Producer(s) and the Agent, executed in connection with this Product and the
related Collateral.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first written above.
[Laboratory]
By_____________________________
Name:
Title:
Address:
Attn:
- 6 -
226
ORION PICTURES CORPORATION
By_____________________________
Name:
Title:
Address:
Attn:
[LIST EACH OTHER CREDIT PARTY]
By_____________________________
Name:
Title:
Address:
Attn:
CHEMICAL BANK, as Agent
By_____________________________
Name:
Title:
Address:
Attn:
- 7 -
227
Schedule 1
List of Laboratory and Storage Facilities
- 8 -
228
Schedule 2
[Attach Laboratory's Standard Terms of Business]
- 9 -
229
Schedule 3
List of Laboratories
California:
Deluxe Laboratories
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(213) 462-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇
Preferred Media, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇ ▇▇▇▇, Facilities Manager
FilmTreat West Corp.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, President
New York:
Preferred Media, Inc.
▇▇▇ ▇. ▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
New Jersey:
Preferred Media, Inc.
- 10 -
230
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
- 11 -
231
EXHIBIT D-1
FORM OF BORROWER PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of November
1, 1995 between ORION PICTURES CORPORATION, a
Delaware corporation (the "Pledgor") and
CHEMICAL BANK, as Agent for the Lenders
referred to herein (in such capacity, the
"Agent").
Introductory Statement
Pursuant to a Credit, Security and Guaranty Agreement dated as
of November 1, 1995 among the Pledgor, the Corporate Guarantors referred to
therein, the Lenders referred to therein and the Agent (said agreement as it
may hereafter be amended, supplemented or otherwise modified, renewed or
replaced from time to time in accordance with its terms being the "Credit
Agreement"), the Lenders have agreed to make loans (the "Loans") to the
Pledgor.
The Pledgor owns beneficially and of record all of the issued
and outstanding shares of the capital stock of each Subsidiary listed on
Schedule 1 hereto (being referred to herein as the "Pledged Affiliates").
In order to induce the Lenders to enter into the Credit
Agreement and make the Loans to the Pledgor and to secure the obligations of
the Pledgor under the Credit Agreement (such obligations of the Pledgor being
hereinafter referred to as the "Obligations"), the Pledgor is pledging to the
Agent, for the ratable benefit of the Lenders, all of the issued and
outstanding capital stock of the Pledged Affiliates, all as more fully set
forth herein.
Accordingly, the parties hereto agree as follows (capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in the Credit Agreement):
232
1. Pledge. (a) As security for payment in full of the
Obligations, the Pledgor hereby pledges, hypothecates, assigns, transfers, sets
over and delivers unto the Agent, for the ratable benefit of the Lenders, and
grants a security interest in (i) all the capital stock of each of the Pledged
Affiliates which the Pledgor owns beneficially and of record, and (ii) all
proceeds of such capital stock and all other securities or other property at
any time and from time to time receivable or otherwise distributed in respect
of or in exchange for any or all of such capital stock or additional
securities. All items referred to in clauses (i) and (ii) of this Section 1
are hereinafter referred to collectively as the "Pledged Securities". (1)
(b) The Pledgor shall deliver to the Agent the
certificates representing the Pledged Securities accompanied by undated stock
powers executed in blank and by such other instruments or documents as the
Agent or its counsel shall reasonably request.
2. Registration in Nominee Name; Denominations. The Agent
shall have the right (in its sole and absolute discretion) to hold the
certificates representing any Pledged Securities in its own name, the name of
its nominee or in the name of the Pledgor, endorsed or assigned in blank or in
favor of the Agent. Upon the occurrence and during the continuation of an
Event of Default, the Agent shall have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.
3. ▇▇▇▇▇▇▇'s Representations, Warranties and Covenants. The
Pledgor hereby represents and warrants to and/or covenants and agrees with the
Agent as follows:
(i) the Pledged Securities constitute 100% of the
issued and outstanding equity securities of each of the Pledged Affiliates;
____________________
(1) The Agent has the discretion to limit this Lien to 65% of the Pledged
Securities of the capital stock of a Pledged Affiliate that is a foreign
controlled subsidiary.
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233
(ii) the Pledged Securities are duly authorized,
validly issued, fully paid and non-assessable;
(iii) there are no restrictions on the transfer of
the Pledged Securities other than as a result of the Credit Agreement or
applicable securities laws or the regulations promulgated thereunder;
(iv) the Pledgor has good title to the Pledged
Securities;
(v) the Pledged Securities are not subject to any
prior liens or encumbrances;
(vi) the Pledgor has the right to pledge the
Pledged Securities hereunder free of any encumbrances, and without the consent
of the creditors of the Pledged Affiliates or any other person or any
government agency whatsoever;
(vii) the Pledgor has full power and authority to
execute, deliver and perform this Agreement and to pledge the Pledged
Securities hereunder;
(viii) the Pledgor will not take any action to allow
any additional equity securities of the Pledged Affiliates to be issued or
grant any options or warrants, unless such securities are pledged to the Agent,
for the ratable benefit of the Lenders, on terms satisfactory to the Agent as
security for the Obligations;
(ix) the execution, delivery and performance of
this Agreement will not violate any provision of law, administrative
regulation, any order of any court or other agency of government, any provision
of any indenture, agreement or other instrument to which the Pledgor is a
party, or be in conflict with, result in a material breach of or constitute
(with due notice and/or lapse of time) a material default under any such
indenture, agreement or other instrument;
(x) there are no pending legal or governmental
proceedings to which the Pledgor is a party or to which any of its properties
is subject which will materially affect the Pledgor's ability to perform its
obligations hereunder; and
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234
(xi) on the date hereof, the Pledged Securities
consist of the securities listed on Schedule 2.
4. Voting Rights; Dividends; etc. (a) Unless and until an
Event of Default shall have occurred and be continuing:
(i) The Pledgor shall be entitled to exercise any
and all voting and/or consensual rights and powers accruing to the owner of the
Pledged Securities or any part thereof for any purpose not inconsistent with
the terms hereof and of the Credit Agreement.
(ii) Any dividends or distributions of any kind
whatsoever received by the Pledgor, whether resulting from a subdivision,
combination, or reclassification of the outstanding capital stock of the shares
or received in exchange for the Pledged Securities or any part thereof or as a
result of any merger, consolidation, acquisition, or other exchange of assets
to which the shares may be a party, or otherwise, shall be and become part of
the Pledged Securities pledged hereunder and shall immediately be delivered to
the Agent to be held subject to the terms of this Agreement.
(iii) The Agent shall execute and deliver to the
Pledgor, or cause to be executed and delivered to the Pledgor, all such
proxies, powers of attorney and other instruments as the Pledgor may reasonably
request for the purpose of enabling the Pledgor to exercise the voting and/or
consensual rights and powers which it is entitled to exercise pursuant to
clause (i) above.
(b) Upon the occurrence and during the continuance of an
Event of Default, all rights of the Pledgor to (i) exercise the voting and/or
consensual rights and powers which it is entitled to exercise pursuant to
Section 4(a)(i) hereof and (ii) receive and retain dividends and distributions
which the Pledgor would be entitled to receive and retain pursuant to Section
4(a)(ii), if any, shall cease and all such rights shall thereupon become vested
in the Agent for the ratable benefit of the Lenders, which shall have the sole
and exclusive right and authority to exercise such voting and/or consensual
rights; provided, however, that to the extent any governmental consents or
filings are required for the exercise by the Agent of any of the foregoing
rights and powers, the Agent shall refrain from
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exercising such rights or powers until the making of such required filings, the
receipt of such consents and the expiration of all related waiting periods.
5. Remedies Upon Default. (a) If an Event of Default shall
have occurred and be continuing, the Agent may sell the Pledged Securities, or
any part thereof, at public or private sale or at any broker's board or on any
securities exchange, for cash, upon credit or for future delivery as the Agent
shall deem appropriate subject to the terms hereof or as otherwise provided in
the New York Uniform Commercial Code. The Agent shall be authorized at any
such sale (if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to persons who will represent and agree that they are
purchasing the Pledged Securities for their own account and not with a view to
the distribution or sale thereof, and upon consummation of any such sale the
Agent shall have the right to assign, transfer, and deliver to the purchaser or
purchasers thereof the Pledged Securities so sold. Each such purchaser at any
such sale shall hold the property sold absolutely, free from any claim or right
on the part of the Pledgor.
(b) The Agent shall give the Pledgor 10 days' written
notice of the Agent's intention to make any such public or private sale, or
sale at any broker's board or on any such securities exchange, or of any other
disposition of the Pledged Securities contemplated by Section 5(a). Such
notice, in the case of public sale, shall state the time and place for such
sale and, in the case of sale at a broker's board or on a securities exchange,
shall state the board or exchange at which such sale is to be made and the day
on which the Pledged Securities, or portion thereof, will first be offered for
sale at such board or exchange. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places within
the State of New York or California as the Agent may fix and shall state in the
notice of such sale. At any such sale, the Pledged Securities, or portion
thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Agent may (in its sole and absolute discretion) determine. The
Agent shall not be obligated to make any sale of the Pledged Securities if it
shall determine not to do so, regardless of the fact that notice of sale of the
Pledged Securities may have been given. The Agent may, without notice or
publication, adjourn any
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public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case the sale of all or any part of the Pledged Securities is
made on credit or for future delivery, the Pledged Securities so sold shall be
retained by the Agent until the sale price is paid by the purchaser or
purchasers thereof, but the Agent shall not incur any liability in case any
such purchaser or purchasers shall fail to take up and pay for the Pledged
Securities so sold and, in case of any such failure, such Pledged Securities
may be sold again upon like notice. At any sale or sales made pursuant to this
Section 5, the Agent may bid for or purchase, free from any claim or right of
whatever kind, including any equity of redemption, of the Pledgor, any such
demand, notice, claim, right or equity being hereby expressly waived and
released, any or all of the Pledged Securities offered for sale, and may make
any payment on the account thereof by using any claim for moneys then due and
payable to the Agent by the Debtors or the Pledgor as a credit against the
purchase price; and the Agent, upon compliance with the terms of sale, may
hold, retain and dispose of the Pledged Securities without further
accountability therefor to the Pledgor or any third party. The Agent shall in
any such sale make no representations or warranties with respect to the Pledged
Securities or any part thereof, and the Agent shall not be chargeable with any
of the obligations or liabilities of the Pledgor with respect thereto. The
Pledgor hereby agrees (i) it will indemnify and hold the Agent harmless from
and against any and all claims with respect to the Pledged Securities asserted
before the taking of actual possession or control of the Pledged Securities by
the Agent pursuant to this Agreement or arising out of any act of, or omission
to act on the part of, any party other than the Agent prior to such taking of
actual possession or control by the Agent, or arising out of any act on the
part of the Pledgor or its agents before or after the commencement of such
actual possession or control by the Agent; and (ii) the Agent shall have no
liability or obligation arising out of any such claim. As an alternative to
exercising the power of sale herein conferred upon it, the Agent may proceed by
a suit or suits at law or in equity to foreclose this Agreement and to sell the
Pledged Securities, or any portion thereof, pursuant to a judgment or decree of
a court or courts having competent jurisdiction.
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6. Application of Proceeds of Sale and Cash. The proceeds of
sale of the Pledged Securities sold pursuant to Section 5 hereof shall be
applied by the Agent (in such order as the Agent shall in its sole discretion
determine) to the payment in full of the Obligations and the payment of costs
incurred by the Agent while enforcing its rights pursuant to this Agreement.
7. Agent Appointed Attorney-in-Fact. Upon the occurrence of
an Event of Default and during the continuance of an Event of Default, the
Pledgor hereby appoints the Agent its attorney-in-fact for the purpose of
carrying out the provisions of this Agreement and the pledge of the Pledged
Securities hereunder and taking any action and executing any instrument which
the Agent may deem necessary or advisable to accomplish the purposes hereof,
which appointment is irrevocable and coupled with an interest. Without
limiting the generality of the foregoing, the Agent shall have the right and
power to receive, endorse, and collect all checks and other orders for the
payment of money made payable to the Pledgor representing any dividend or other
distribution payable in respect of the Pledged Securities or any part thereof
and to give full discharge for the same.
8. Securities Act, etc. In view of the position of the
Pledgor in relation to the Pledged Securities, or because of other present or
future circumstances, a question may arise under the Securities Act of 1933, as
amended, as now or hereafter in effect, or any similar statute hereafter
enacted analogous in purpose or effect (such Act and any such similar statute
as from time to time in effect being hereinafter called the "Federal Securities
Laws"), with respect to any disposition of the Pledged Securities permitted
hereunder. The Pledgor understands that compliance with the Federal Securities
Laws may very strictly limit the course of conduct of the Agent if the Agent
were to attempt to dispose of all or any part of the Pledged Securities, and
may also limit the extent to which or the manner in which any subsequent
transferee of any Pledged Securities may dispose of the same. Similarly, there
may be other legal restrictions or limitations affecting the Agent in any
attempt to dispose of all or any part of the Pledged Securities under
applicable "Blue Sky" or other state securities laws, or similar laws analogous
in purpose or effect. Under applicable law, in the absence of an agreement to
the contrary, the Agent may be held to have certain general duties and
obligations to the Pledgor to make some effort
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towards obtaining a fair price even though the Obligations may be discharged or
reduced by the proceeds of a sale at a lesser price. The Pledgor hereby agrees
that the Agent shall not have any such general duty or obligation to it, and
the Pledgor will not attempt to hold the Agent responsible for selling all or
any part of the Pledged Securities at an inadequate price, even if the Agent
shall accept the first offer received or does not approach more than one
possible purchaser. Without limiting the generality of the foregoing, the
provisions of this Section 8 would apply if, for example, the Agent were to
place all or any part of the Pledged Securities for private placement by an
investment banking firm, or if such investment banking firm purchased all or
any part of the Pledged Securities for its own account, or if the Agent placed
all or any part of the Pledged Securities privately with a purchaser or
purchasers.
9. Termination. The pledge hereunder shall terminate when
all of the Obligations and all amounts payable to the Guarantors under the
Guaranty Agreement shall have been fully paid and the Commitments have
terminated. At such time the Agent shall, at the sole cost and expense of the
Pledgor, assign and deliver to the Pledgor, or to such person or persons as the
Pledgor shall designate, against receipt, such of the Pledged Securities (if
any) as shall not have been sold or otherwise applied by the Agent pursuant to
the terms hereof and shall still be held by it hereunder, together with
appropriate instruments of reassignment and release. Any such reassignment
shall be without recourse upon or warranty by the Agent (except as to acts of
the Agent or persons claiming through the Agent).
10. Notices. All demands, notices and other communications
which any party hereto may desire or may be required to give to any other party
hereunder shall be in writing (including telegraphic communication) and shall
be mailed, telegraphed or delivered to such other party at its address on the
signature pages hereto or to any such party at such other address as shall be
designated by such party in a written notice to the other party, complying as
to delivery with the terms of this Section 10. All such demands, notices and
other communications shall be effective when received or five business days
after mailing, whichever is earlier.
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11. SERVICE OF PROCESS. THE PLEDGOR (A) HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF THE STATE COURTS OF THE STATE OF NEW YORK AND TO
THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK FOR THE PURPOSE OF ANY SUIT, ACTION, OR OTHER PROCEEDING ARISING
OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF BROUGHT BY THE
AGENT OR ITS SUCCESSORS OR ASSIGNS AND (B) HEREBY WAIVES, AND AGREES NOT TO
ASSERT, BY WAY OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION,
OR PROCEEDING, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION
OF THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM
ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION, OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION, OR PROCEEDING IS
IMPROPER OR THAT THIS AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE
ENFORCED IN OR BY SUCH COURT, AND (C) HEREBY WAIVES IN ANY SUCH SUIT, ACTION,
OR PROCEEDING ANY OFFSETS OR COUNTERCLAIMS WHICH ARE UNRELATED TO THE
TRANSACTIONS CONTEMPLATED HEREIN. THE PLEDGOR HEREBY CONSENTS TO SERVICE OF
PROCESS BY REGISTERED MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN.
THE PLEDGOR AGREES THAT ITS SUBMISSION TO JURISDICTION AND ITS CONSENT TO
SERVICE OF PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF THE LENDERS.
FINAL JUDGMENT AGAINST THE PLEDGOR IN ANY SUCH SUIT, ACTION, OR PROCEEDING
SHALL BE CONCLUSIVE, AND MAY BE ENFORCED IN OTHER JURISDICTIONS (A) BY SUIT,
ACTION, OR PROCEEDING ON THE JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL
BE CONCLUSIVE EVIDENCE OF THE FACT AND OF THE AMOUNT OF ANY INDEBTEDNESS OR
LIABILITY OF THE PLEDGOR THEREIN DESCRIBED OR (B) IN ANY OTHER MANNER PROVIDED
BY OR PURSUANT TO THE LAWS OF SUCH OTHER JURISDICTION; PROVIDED, HOWEVER, THAT
THE AGENT MAY AT ITS OPTION BRING SUIT, OR INSTITUTE OTHER JUDICIAL PROCEEDINGS
AGAINST THE PLEDGOR OR ANY OF ITS ASSETS IN ANY STATE OR FEDERAL COURT OF THE
UNITED STATES OR OF ANY COUNTRY OR PLACE WHERE THE PLEDGOR OR SUCH ASSETS MAY
BE FOUND. THE PLEDGOR FURTHER COVENANTS AND AGREES THAT SO LONG AS THIS
AGREEMENT SHALL BE IN EFFECT, IT SHALL MAINTAIN A DULY APPOINTED AGENT FOR THE
RECEIPT AND ACCEPTANCE ON ITS BEHALF OF SERVICE OF SUMMONS AND OTHER LEGAL
PROCESSES, AND UPON FAILURE TO DO SO THE CLERK OF EACH COURT TO WHOSE
JURISDICTION IT HAS SUBMITTED SHALL BE DEEMED TO BE ITS RESPECTIVE DESIGNATED
AGENT UPON WHOM SUCH PROCESS MAY BE SERVED ON ITS BEHALF, AND NOTIFICATION BY
THE ATTORNEY FOR THE PLAINTIFF, COMPLAINANT OR PETITIONER THEREIN BY MAIL.
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12. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW WHICH CANNOT BE WAIVED, THE PLEDGOR HEREBY WAIVES, AND COVENANTS
THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY
RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND,
ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE
SUBJECT MATTER HEREOF, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING
OR WHETHER IN CONTRACT OR TORT OR OTHERWISE. THE PLEDGOR ACKNOWLEDGES THAT IT
HAS BEEN INFORMED THAT THE PROVISIONS OF THIS SECTION 12 CONSTITUTE A MATERIAL
INDUCEMENT UPON WHICH THE OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY
IN ENTERING INTO THIS AGREEMENT. THE PARTIES HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 12 WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE PLEDGOR TO THE WAIVER OF ITS RIGHTS TO TRIAL BY JURY.
13. CHOICE OF LAW. THIS AGREEMENT AND ANY INSTRUMENT OR
AGREEMENT REQUIRED HEREUNDER SHALL BE DEEMED TO BE MADE UNDER, SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
14. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
15. Further Assurances. The Pledgor, at its own expense,
will execute and deliver, from time to time, any and all further, or other,
instruments, and perform such acts, as the Agent may reasonably request to
effect the purposes of this Agreement and to secure to the Agent for the
ratable benefit of the Lenders, the benefits of all rights, authorities, and
remedies conferred upon the Agent and the Lenders by the terms of this
Agreement.
16. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall
constitute an original for all purposes, but all such counterparts taken
together shall constitute the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
ORION PICTURES CORPORATION
By:________________________
Name:
Title:
Address:
CHEMICAL BANK
By:_______________________
Name:
Title:
Address:
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SCHEDULE 1
Pledged Affiliates
ORION HOME ENTERTAINMENT CORPORATION
ORION PICTURES DISTRIBUTION CORPORATION
ORION TV PRODUCTIONS, INC.
MUSICWAYS, INC.
ORION MUSIC PUBLISHING, INC.
ORION PRODUCTIONS, INC.
MCEG STERLING PRODUCTIONS
MCEG STERLING COMPUTER SERVICES
MCEG STERLING ADMINISTRATIONS
MCEG STERLING ENTERTAINMENT
MCEG STERLING DEVELOPMENT
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SCHEDULE 2
Pledged Securities
Pledged Affiliate Stock Certificate No. No. of Shares
----------------- --------------------- -------------
244
EXHIBIT D-2
FORM OF PARENT PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of November
1, 1995 between METROMEDIA INTERNATIONAL
GROUP, INC., a Delaware corporation (the
"Pledgor") and CHEMICAL BANK, as Agent for
the Lenders referred to herein (in such
capacity, the "Agent").
Introductory Statement
Pursuant to a Credit, Security and Guaranty Agreement dated as
of November 1, 1995 among Orion Pictures Corporation (the "Borrower"), the
Corporate Guarantors referred to therein, the Lenders referred to therein and
the Agent (said agreement as it may hereafter be amended, supplemented or
otherwise modified, renewed or replaced from time to time in accordance with
its terms being the "Credit Agreement"), the Lenders have agreed to make loans
(the "Loans") to the Borrower.
The Pledgor owns beneficially and of record all of the issued
and outstanding shares of the capital stock of the Borrower.
In order to induce the Lenders to enter into the Credit
Agreement and make the Loans to the Borrower and to secure the obligations of
the Borrower under the Credit Agreement (such obligations of the Borrower being
hereinafter referred to as the "Obligations"), the Pledgor is pledging to the
Agent, for the ratable benefit of the Lenders, all of the issued and
outstanding capital stock of the Borrower, all as more fully set forth herein.
Accordingly, the parties hereto agree as follows (capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in the Credit Agreement):
245
1. Pledge. (a) As security for payment in full of the
Obligations, the Pledgor hereby pledges, hypothecates, assigns, transfers, sets
over and delivers unto the Agent, for the ratable benefit of the Lenders, and
grants a security interest in (i) all the capital stock of each of the Borrower
which the Pledgor owns beneficially and of record, and (ii) all proceeds of
such capital stock and all other securities or other property at any time and
from time to time receivable or otherwise distributed in respect of or in
exchange for any or all of such capital stock or additional securities. All
items referred to in clauses (i) and (ii) of this Section 1 are hereinafter
referred to collectively as the "Pledged Securities".
(b) The Pledgor shall deliver to the Agent the
certificates representing the Pledged Securities accompanied by undated stock
powers executed in blank and by such other instruments or documents as the
Agent or its counsel shall reasonably request.
2. Registration in Nominee Name; Denominations. The Agent
shall have the right (in its sole and absolute discretion) to hold the
certificates representing any Pledged Securities in its own name, the name of
its nominee or in the name of the Pledgor, endorsed or assigned in blank or in
favor of the Agent. Upon the occurrence and during the continuation of an
Event of Default, the Agent shall have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.
3. ▇▇▇▇▇▇▇'s Representations, Warranties and Covenants. The
Pledgor hereby represents and warrants to and/or covenants and agrees with the
Agent as follows:
(i) the Pledged Securities constitute 100% of the
issued and outstanding equity securities of the Borrower;
(ii) the Pledged Securities are duly authorized,
validly issued, fully paid and non-assessable;
(iii) there are no restrictions on the transfer of
the Pledged Securities other than as a result of the Credit
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Agreement or applicable securities laws or the regulations promulgated
thereunder;
(iv) the Pledgor has good title to the Pledged
Securities;
(v) the Pledged Securities are not subject to any
prior liens or encumbrances;
(vi) the Pledgor has the right to pledge the
Pledged Securities hereunder free of any encumbrances, and without the consent
of the creditors of the Borrower or any other person or any government agency
whatsoever;
(vii) the Pledgor has full power and authority to
execute, deliver and perform this Agreement and to pledge the Pledged
Securities hereunder;
(viii) the Pledgor will not take any action to allow
any additional equity securities of the Borrower to be issued or grant any
options or warrants, unless such securities are pledged to the Agent, for the
ratable benefit of the Lenders, on terms satisfactory to the Agent as security
for the Obligations;
(ix) the execution, delivery and performance of
this Agreement will not violate any provision of law, administrative
regulation, any order of any court or other agency of government, any provision
of any indenture, agreement or other instrument to which the Pledgor is a
party, or be in conflict with, result in a material breach of or constitute
(with due notice and/or lapse of time) a material default under any such
indenture, agreement or other instrument;
(x) there are no pending legal or governmental
proceedings to which the Pledgor is a party or to which any of its properties
is subject which will materially affect the Pledgor's ability to perform its
obligations hereunder; and
(xi) on the date hereof, the Pledged Securities
consist of the securities listed on Schedule 1.
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4. Voting Rights; Dividends; etc. (a) Unless and until an
Event of Default shall have occurred and be continuing:
(i) The Pledgor shall be entitled to exercise any
and all voting and/or consensual rights and powers accruing to the owner of the
Pledged Securities or any part thereof for any purpose not inconsistent with
the terms hereof and of the Credit Agreement.
(ii) Any dividends or distributions of any kind
whatsoever received by the Pledgor, whether resulting from a subdivision,
combination, or reclassification of the outstanding capital stock of the shares
or received in exchange for the Pledged Securities or any part thereof or as a
result of any merger, consolidation, acquisition, or other exchange of assets
to which the shares may be a party, or otherwise, shall be and become part of
the Pledged Securities pledged hereunder and shall immediately be delivered to
the Agent to be held subject to the terms of this Agreement.
(iii) The Agent shall execute and deliver to the
Pledgor, or cause to be executed and delivered to the Pledgor, all such
proxies, powers of attorney and other instruments as the Pledgor may reasonably
request for the purpose of enabling the Pledgor to exercise the voting and/or
consensual rights and powers which it is entitled to exercise pursuant to
clause (i) above.
(b) Upon the occurrence and during the continuance of an
Event of Default, all rights of the Pledgor to (i) exercise the voting and/or
consensual rights and powers which it is entitled to exercise pursuant to
Section 4(a)(i) hereof and (ii) receive and retain dividends and distributions
which the Pledgor would be entitled to receive and retain pursuant to Section
4(a)(ii), if any, shall cease and all such rights shall thereupon become vested
in the Agent for the ratable benefit of the Lenders, which shall have the sole
and exclusive right and authority to exercise such voting and/or consensual
rights; provided, however, that to the extent any governmental consents or
filings are required for the exercise by the Agent of any of the foregoing
rights and powers, the Agent shall refrain from exercising such rights or
powers until the making of such required filings, the receipt of such consents
and the expiration of all related waiting periods.
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5. Remedies Upon Default. (a) If an Event of Default shall
have occurred and be continuing, the Agent may sell the Pledged Securities, or
any part thereof, at public or private sale or at any broker's board or on any
securities exchange, for cash, upon credit or for future delivery as the Agent
shall deem appropriate subject to the terms hereof or as otherwise provided in
the New York Uniform Commercial Code. The Agent shall be authorized at any
such sale (if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to persons who will represent and agree that they are
purchasing the Pledged Securities for their own account and not with a view to
the distribution or sale thereof, and upon consummation of any such sale the
Agent shall have the right to assign, transfer, and deliver to the purchaser or
purchasers thereof the Pledged Securities so sold. Each such purchaser at any
such sale shall hold the property sold absolutely, free from any claim or right
on the part of the Pledgor.
(b) The Agent shall give the Pledgor 10 days' written
notice of the Agent's intention to make any such public or private sale, or
sale at any broker's board or on any such securities exchange, or of any other
disposition of the Pledged Securities contemplated by Section 5(a). Such
notice, in the case of public sale, shall state the time and place for such
sale and, in the case of sale at a broker's board or on a securities exchange,
shall state the board or exchange at which such sale is to be made and the day
on which the Pledged Securities, or portion thereof, will first be offered for
sale at such board or exchange. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places within
the State of New York or California as the Agent may fix and shall state in the
notice of such sale. At any such sale, the Pledged Securities, or portion
thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Agent may (in its sole and absolute discretion) determine. The
Agent shall not be obligated to make any sale of the Pledged Securities if it
shall determine not to do so, regardless of the fact that notice of sale of the
Pledged Securities may have been given. The Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case the
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sale of all or any part of the Pledged Securities is made on credit or for
future delivery, the Pledged Securities so sold shall be retained by the Agent
until the sale price is paid by the purchaser or purchasers thereof, but the
Agent shall not incur any liability in case any such purchaser or purchasers
shall fail to take up and pay for the Pledged Securities so sold and, in case
of any such failure, such Pledged Securities may be sold again upon like
notice. At any sale or sales made pursuant to this Section 5, the Agent may
bid for or purchase, free from any claim or right of whatever kind, including
any equity of redemption, of the Pledgor, any such demand, notice, claim, right
or equity being hereby expressly waived and released, any or all of the Pledged
Securities offered for sale, and may make any payment on the account thereof by
using any claim for moneys then due and payable to the Agent by the Debtors or
the Pledgor as a credit against the purchase price; and the Agent, upon
compliance with the terms of sale, may hold, retain and dispose of the Pledged
Securities without further accountability therefor to the Pledgor or any third
party. The Agent shall in any such sale make no representations or warranties
with respect to the Pledged Securities or any part thereof, and the Agent shall
not be chargeable with any of the obligations or liabilities of the Pledgor
with respect thereto. The Pledgor hereby agrees (i) it will indemnify and hold
the Agent harmless from and against any and all claims with respect to the
Pledged Securities asserted before the taking of actual possession or control
of the Pledged Securities by the Agent pursuant to this Agreement or arising
out of any act of, or omission to act on the part of, any party other than the
Agent prior to such taking of actual possession or control by the Agent, or
arising out of any act on the part of the Pledgor or its agents before or after
the commencement of such actual possession or control by the Agent; and (ii)
the Agent shall have no liability or obligation arising out of any such claim.
As an alternative to exercising the power of sale herein conferred upon it, the
Agent may proceed by a suit or suits at law or in equity to foreclose this
Agreement and to sell the Pledged Securities, or any portion thereof, pursuant
to a judgment or decree of a court or courts having competent jurisdiction.
6. Application of Proceeds of Sale and Cash. The proceeds of
sale of the Pledged Securities sold pursuant to Section 5 hereof shall be
applied by the Agent (in such order as
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the Agent shall in its sole discretion determine) to the payment in full of the
Obligations and the payment of costs incurred by the Agent while enforcing its
rights pursuant to this Agreement.
7. Agent Appointed Attorney-in-Fact. Upon the occurrence of
an Event of Default and during the continuance of an Event of Default, the
Pledgor hereby appoints the Agent its attorney-in-fact for the purpose of
carrying out the provisions of this Agreement and the pledge of the Pledged
Securities hereunder and taking any action and executing any instrument which
the Agent may deem necessary or advisable to accomplish the purposes hereof,
which appointment is irrevocable and coupled with an interest. Without
limiting the generality of the foregoing, the Agent shall have the right and
power to receive, endorse, and collect all checks and other orders for the
payment of money made payable to the Pledgor representing any dividend or other
distribution payable in respect of the Pledged Securities or any part thereof
and to give full discharge for the same.
8. Securities Act, etc. In view of the position of the
Pledgor in relation to the Pledged Securities, or because of other present or
future circumstances, a question may arise under the Securities Act of 1933, as
amended, as now or hereafter in effect, or any similar statute hereafter
enacted analogous in purpose or effect (such Act and any such similar statute
as from time to time in effect being hereinafter called the "Federal Securities
Laws"), with respect to any disposition of the Pledged Securities permitted
hereunder. The Pledgor understands that compliance with the Federal Securities
Laws may very strictly limit the course of conduct of the Agent if the Agent
were to attempt to dispose of all or any part of the Pledged Securities, and
may also limit the extent to which or the manner in which any subsequent
transferee of any Pledged Securities may dispose of the same. Similarly, there
may be other legal restrictions or limitations affecting the Agent in any
attempt to dispose of all or any part of the Pledged Securities under
applicable "Blue Sky" or other state securities laws, or similar laws analogous
in purpose or effect. Under applicable law, in the absence of an agreement to
the contrary, the Agent may be held to have certain general duties and
obligations to the Pledgor to make some effort towards obtaining a fair price
even though the Obligations may be discharged or reduced by the proceeds of a
sale at a lesser price. The Pledgor hereby agrees that the Agent shall not
have
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any such general duty or obligation to it, and the Pledgor will not attempt to
hold the Agent responsible for selling all or any part of the Pledged
Securities at an inadequate price, even if the Agent shall accept the first
offer received or does not approach more than one possible purchaser. Without
limiting the generality of the foregoing, the provisions of this Section 8
would apply if, for example, the Agent were to place all or any part of the
Pledged Securities for private placement by an investment banking firm, or if
such investment banking firm purchased all or any part of the Pledged
Securities for its own account, or if the Agent placed all or any part of the
Pledged Securities privately with a purchaser or purchasers.
9. Termination. The pledge hereunder shall terminate when
all of the Obligations and all amounts payable to the Guarantors under the
Guaranty Agreement shall have been fully paid and the Commitments have
terminated. At such time the Agent shall, at the sole cost and expense of the
Pledgor, assign and deliver to the Pledgor, or to such person or persons as the
Pledgor shall designate, against receipt, such of the Pledged Securities (if
any) as shall not have been sold or otherwise applied by the Agent pursuant to
the terms hereof and shall still be held by it hereunder, together with
appropriate instruments of reassignment and release. Any such reassignment
shall be without recourse upon or warranty by the Agent (except as to acts of
the Agent or persons claiming through the Agent).
10. Notices. All demands, notices and other communications
which any party hereto may desire or may be required to give to any other party
hereunder shall be in writing (including telegraphic communication) and shall
be mailed, telegraphed or delivered to such other party at its address on the
signature pages hereto or to any such party at such other address as shall be
designated by such party in a written notice to the other party, complying as
to delivery with the terms of this Section 10. All such demands, notices and
other communications shall be effective when received or five business days
after mailing, whichever is earlier.
11. SERVICE OF PROCESS. THE PLEDGOR (A) HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF THE STATE COURTS OF THE STATE OF NEW YORK AND TO
THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK, FOR
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THE PURPOSE OF ANY SUIT, ACTION, OR OTHER PROCEEDING ARISING OUT OF OR BASED
UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF BROUGHT BY THE AGENT OR ITS
SUCCESSORS OR ASSIGNS AND (B) ▇▇▇▇▇▇ ▇▇▇▇▇▇, AND AGREES NOT TO ASSERT, BY WAY
OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION, OR PROCEEDING,
ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF THE
ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT OR
EXECUTION, THAT THE SUIT, ACTION, OR PROCEEDING IS BROUGHT IN AN INCONVENIENT
FORUM, THAT THE VENUE OF THE SUIT, ACTION, OR PROCEEDING IS IMPROPER OR THAT
THIS AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE ENFORCED IN OR BY SUCH
COURT, AND (C) HEREBY WAIVES IN ANY SUCH SUIT, ACTION, OR PROCEEDING ANY
OFFSETS OR COUNTERCLAIMS WHICH ARE UNRELATED TO THE TRANSACTIONS CONTEMPLATED
HEREIN. THE PLEDGOR HEREBY CONSENTS TO SERVICE OF PROCESS BY REGISTERED MAIL
AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN. THE PLEDGOR AGREES THAT ITS
SUBMISSION TO JURISDICTION AND ITS CONSENT TO SERVICE OF PROCESS BY MAIL IS
MADE FOR THE EXPRESS BENEFIT OF THE LENDERS. FINAL JUDGMENT AGAINST THE
PLEDGOR IN ANY SUCH SUIT, ACTION, OR PROCEEDING SHALL BE CONCLUSIVE, AND MAY BE
ENFORCED IN OTHER JURISDICTIONS (A) BY SUIT, ACTION, OR PROCEEDING ON THE
JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE
FACT AND OF THE AMOUNT OF ANY INDEBTEDNESS OR LIABILITY OF THE PLEDGOR THEREIN
DESCRIBED OR (B) IN ANY OTHER MANNER PROVIDED BY OR PURSUANT TO THE LAWS OF
SUCH OTHER JURISDICTION; PROVIDED, HOWEVER, THAT THE AGENT MAY AT ITS OPTION
BRING SUIT, OR INSTITUTE OTHER JUDICIAL PROCEEDINGS AGAINST THE PLEDGOR OR ANY
OF ITS ASSETS IN ANY STATE OR FEDERAL COURT OF THE UNITED STATES OR OF ANY
COUNTRY OR PLACE WHERE THE PLEDGOR OR SUCH ASSETS MAY BE FOUND. THE PLEDGOR
FURTHER COVENANTS AND AGREES THAT SO LONG AS THIS AGREEMENT SHALL BE IN EFFECT,
IT SHALL MAINTAIN A DULY APPOINTED AGENT FOR THE RECEIPT AND ACCEPTANCE ON ITS
BEHALF OF SERVICE OF SUMMONS AND OTHER LEGAL PROCESSES, AND UPON FAILURE TO DO
SO THE CLERK OF EACH COURT TO WHOSE JURISDICTION IT HAS SUBMITTED SHALL BE
DEEMED TO BE ITS RESPECTIVE DESIGNATED AGENT UPON WHOM SUCH PROCESS MAY BE
SERVED ON ITS BEHALF, AND NOTIFICATION BY THE ATTORNEY FOR THE PLAINTIFF,
COMPLAINANT OR PETITIONER THEREIN BY MAIL.
12. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW WHICH CANNOT BE WAIVED, THE PLEDGOR HEREBY WAIVES, AND COVENANTS
THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY
RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND,
ACTION, OR
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CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT
MATTER HEREOF, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING OR
WHETHER IN CONTRACT OR TORT OR OTHERWISE. THE PLEDGOR ACKNOWLEDGES THAT IT HAS
BEEN INFORMED THAT THE PROVISIONS OF THIS SECTION 12 CONSTITUTE A MATERIAL
INDUCEMENT UPON WHICH THE OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY
IN ENTERING INTO THIS AGREEMENT. THE PARTIES HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 12 WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE PLEDGOR TO THE WAIVER OF ITS RIGHTS TO TRIAL BY JURY.
13. CHOICE OF LAW. THIS AGREEMENT AND ANY INSTRUMENT OR
AGREEMENT REQUIRED HEREUNDER SHALL BE DEEMED TO BE MADE UNDER, SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
14. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
15. Further Assurances. The Pledgor, at its own expense,
will execute and deliver, from time to time, any and all further, or other,
instruments, and perform such acts, as the Agent may reasonably request to
effect the purposes of this Agreement and to secure to the Agent for the
ratable benefit of the Lenders, the benefits of all rights, authorities, and
remedies conferred upon the Agent and the Lenders by the terms of this
Agreement.
16. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall
constitute an original for all purposes, but all such counterparts taken
together shall constitute the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
METROMEDIA INTERNATIONAL GROUP, INC.
By:________________________
Name:
Title:
Address:
CHEMICAL BANK
By:_______________________
Name:
Title:
Address:
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SCHEDULE 1
Pledged Securities
Stock Certificate No. No. of Shares
--------------------- -------------
256
EXHIBIT D-3
FORM OF SUBSIDIARY PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of November
1, 1995 between [INSERT NAME OF SUBSIDIARY]
(the "Pledgor") and CHEMICAL BANK, as Agent
for the Lenders referred to herein (in such
capacity, the "Agent").
Introductory Statement
Pursuant to a Credit, Security and Guaranty Agreement dated as
of November 1, 1995 among Orion Pictures Corporation (the "Borrower"), the
Corporate Guarantors referred to therein, the Lenders referred to therein and
the Agent (said agreement as it may hereafter be amended, supplemented or
otherwise modified, renewed or replaced from time to time in accordance with
its terms being the "Credit Agreement"), the Lenders have agreed to make loans
(the "Loans") to the Borrower.
The Pledgor owns beneficially and of record all of the issued
and outstanding shares of the capital stock of each Subsidiary listed on
Schedule 1 hereto (being referred to herein as the "Pledged Affiliates").
In order to induce the Lenders to enter into the Credit
Agreement and make the Loans to the Borrower and to secure the obligations of
the Borrower under the Credit Agreement (such obligations of the Borrower being
hereinafter referred to as the "Obligations"), the Pledgor is pledging to the
Agent, for the ratable benefit of the Lenders, all of the issued and
outstanding capital stock of the Pledged Affiliates, all as more fully set
forth herein.
Accordingly, the parties hereto agree as follows (capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in the Credit Agreement):
257
1. Pledge. (a) As security for payment in full of the
Obligations, the Pledgor hereby pledges, hypothecates, assigns, transfers, sets
over and delivers unto the Agent, for the ratable benefit of the Lenders, and
grants a security interest in (i) all the capital stock of each of the Pledged
Affiliates which the Pledgor owns beneficially and of record, and (ii) all
proceeds of such capital stock and all other securities or other property at
any time and from time to time receivable or otherwise distributed in respect
of or in exchange for any or all of such capital stock or additional
securities. All items referred to in clauses (i) and (ii) of this Section 1
are hereinafter referred to collectively as the "Pledged Securities". (1)
(b) The Pledgor shall deliver to the Agent the
certificates representing the Pledged Securities accompanied by undated stock
powers executed in blank and by such other instruments or documents as the
Agent or its counsel shall reasonably request.
2. Registration in Nominee Name; Denominations. The Agent
shall have the right (in its sole and absolute discretion) to hold the
certificates representing any Pledged Securities in its own name, the name of
its nominee or in the name of the Pledgor, endorsed or assigned in blank or in
favor of the Agent. Upon the occurrence and during the continuation of an
Event of Default, the Agent shall have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.
3. ▇▇▇▇▇▇▇'s Representations, Warranties and Covenants. The
Pledgor hereby represents and warrants to and/or covenants and agrees with the
Agent as follows:
(i) the Pledged Securities constitute 100% of the
issued and outstanding equity securities of each of the Pledged Affiliates;
____________________
(1) The Agent has the discretion to limit the Lien to 65% of the Pledged
Securities of the capital stock of a Pledged Affiliate that is a foreign
controlled subsidiary.
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(ii) the Pledged Securities are duly authorized,
validly issued, fully paid and non-assessable;
(iii) there are no restrictions on the transfer of
the Pledged Securities other than as a result of the Credit Agreement or
applicable securities laws or the regulations promulgated thereunder;
(iv) the Pledgor has good title to the Pledged
Securities;
(v) the Pledged Securities are not subject to any
prior liens or encumbrances;
(vi) the Pledgor has the right to pledge the
Pledged Securities hereunder free of any encumbrances, and without the consent
of the creditors of the Pledged Affiliates or any other person or any
government agency whatsoever;
(vii) the Pledgor has full power and authority to
execute, deliver and perform this Agreement and to pledge the Pledged
Securities hereunder;
(viii) the Pledgor will not take any action to allow
any additional equity securities of the Pledged Affiliates to be issued or
grant any options or warrants, unless such securities are pledged to the Agent,
for the ratable benefit of the Lenders, on terms satisfactory to the Agent as
security for the Obligations;
(ix) the execution, delivery and performance of
this Agreement will not violate any provision of law, administrative
regulation, any order of any court or other agency of government, any provision
of any indenture, agreement or other instrument to which the Pledgor is a
party, or be in conflict with, result in a material breach of or constitute
(with due notice and/or lapse of time) a material default under any such
indenture, agreement or other instrument;
(x) there are no pending legal or governmental
proceedings to which the Pledgor is a party or to which any of its properties
is subject which will materially affect the Pledgor's ability to perform its
obligations hereunder; and
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(xi) on the date hereof, the Pledged Securities
consist of the securities listed on Schedule 2.
4. Voting Rights; Dividends; etc. (a) Unless and until an
Event of Default shall have occurred and be continuing:
(i) The Pledgor shall be entitled to exercise any
and all voting and/or consensual rights and powers accruing to the owner of the
Pledged Securities or any part thereof for any purpose not inconsistent with
the terms hereof and of the Credit Agreement.
(ii) Any dividends or distributions of any kind
whatsoever received by the Pledgor, whether resulting from a subdivision,
combination, or reclassification of the outstanding capital stock of the shares
or received in exchange for the Pledged Securities or any part thereof or as a
result of any merger, consolidation, acquisition, or other exchange of assets
to which the shares may be a party, or otherwise, shall be and become part of
the Pledged Securities pledged hereunder and shall immediately be delivered to
the Agent to be held subject to the terms of this Agreement.
(iii) The Agent shall execute and deliver to the
Pledgor, or cause to be executed and delivered to the Pledgor, all such
proxies, powers of attorney and other instruments as the Pledgor may reasonably
request for the purpose of enabling the Pledgor to exercise the voting and/or
consensual rights and powers which it is entitled to exercise pursuant to
clause (i) above.
(b) Upon the occurrence and during the continuance of an
Event of Default, all rights of the Pledgor to (i) exercise the voting and/or
consensual rights and powers which it is entitled to exercise pursuant to
Section 4(a)(i) hereof and (ii) receive and retain dividends and distributions
which the Pledgor would be entitled to receive and retain pursuant to Section
4(a)(ii), if any, shall cease and all such rights shall thereupon become vested
in the Agent for the ratable benefit of the Lenders, which shall have the sole
and exclusive right and authority to exercise such voting and/or consensual
rights; provided, however, that to the extent any governmental consents or
filings are required for the exercise by the Agent of any of the foregoing
rights and powers, the Agent shall refrain from
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exercising such rights or powers until the making of such required filings, the
receipt of such consents and the expiration of all related waiting periods.
5. Remedies Upon Default. (a) If an Event of Default shall
have occurred and be continuing, the Agent may sell the Pledged Securities, or
any part thereof, at public or private sale or at any broker's board or on any
securities exchange, for cash, upon credit or for future delivery as the Agent
shall deem appropriate subject to the terms hereof or as otherwise provided in
the New York Uniform Commercial Code. The Agent shall be authorized at any
such sale (if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to persons who will represent and agree that they are
purchasing the Pledged Securities for their own account and not with a view to
the distribution or sale thereof, and upon consummation of any such sale the
Agent shall have the right to assign, transfer, and deliver to the purchaser or
purchasers thereof the Pledged Securities so sold. Each such purchaser at any
such sale shall hold the property sold absolutely, free from any claim or right
on the part of the Pledgor.
(b) The Agent shall give the Pledgor 10 days' written
notice of the Agent's intention to make any such public or private sale, or
sale at any broker's board or on any such securities exchange, or of any other
disposition of the Pledged Securities contemplated by Section 5(a). Such
notice, in the case of public sale, shall state the time and place for such
sale and, in the case of sale at a broker's board or on a securities exchange,
shall state the board or exchange at which such sale is to be made and the day
on which the Pledged Securities, or portion thereof, will first be offered for
sale at such board or exchange. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places within
the State of New York or California as the Agent may fix and shall state in the
notice of such sale. At any such sale, the Pledged Securities, or portion
thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Agent may (in its sole and absolute discretion) determine. The
Agent shall not be obligated to make any sale of the Pledged Securities if it
shall determine not to do so, regardless of the fact that notice of sale of the
Pledged Securities may have been given. The Agent may, without notice or
publication, adjourn any
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public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case the sale of all or any part of the Pledged Securities is
made on credit or for future delivery, the Pledged Securities so sold shall be
retained by the Agent until the sale price is paid by the purchaser or
purchasers thereof, but the Agent shall not incur any liability in case any
such purchaser or purchasers shall fail to take up and pay for the Pledged
Securities so sold and, in case of any such failure, such Pledged Securities
may be sold again upon like notice. At any sale or sales made pursuant to this
Section 5, the Agent may bid for or purchase, free from any claim or right of
whatever kind, including any equity of redemption, of the Pledgor, any such
demand, notice, claim, right or equity being hereby expressly waived and
released, any or all of the Pledged Securities offered for sale, and may make
any payment on the account thereof by using any claim for moneys then due and
payable to the Agent by the Debtors or the Pledgor as a credit against the
purchase price; and the Agent, upon compliance with the terms of sale, may
hold, retain and dispose of the Pledged Securities without further
accountability therefor to the Pledgor or any third party. The Agent shall in
any such sale make no representations or warranties with respect to the Pledged
Securities or any part thereof, and the Agent shall not be chargeable with any
of the obligations or liabilities of the Pledgor with respect thereto. The
Pledgor hereby agrees (i) it will indemnify and hold the Agent harmless from
and against any and all claims with respect to the Pledged Securities asserted
before the taking of actual possession or control of the Pledged Securities by
the Agent pursuant to this Agreement or arising out of any act of, or omission
to act on the part of, any party other than the Agent prior to such taking of
actual possession or control by the Agent, or arising out of any act on the
part of the Pledgor or its agents before or after the commencement of such
actual possession or control by the Agent; and (ii) the Agent shall have no
liability or obligation arising out of any such claim. As an alternative to
exercising the power of sale herein conferred upon it, the Agent may proceed by
a suit or suits at law or in equity to foreclose this Agreement and to sell the
Pledged Securities, or any portion thereof, pursuant to a judgment or decree of
a court or courts having competent jurisdiction.
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6. Application of Proceeds of Sale and Cash. The proceeds of
sale of the Pledged Securities sold pursuant to Section 5 hereof shall be
applied by the Agent (in such order as the Agent shall in its sole discretion
determine) to the payment in full of the Obligations and the payment of costs
incurred by the Agent while enforcing its rights pursuant to this Agreement.
7. Agent Appointed Attorney-in-Fact. Upon the occurrence of
an Event of Default and during the continuance of an Event of Default, the
Pledgor hereby appoints the Agent its attorney-in-fact for the purpose of
carrying out the provisions of this Agreement and the pledge of the Pledged
Securities hereunder and taking any action and executing any instrument which
the Agent may deem necessary or advisable to accomplish the purposes hereof,
which appointment is irrevocable and coupled with an interest. Without
limiting the generality of the foregoing, the Agent shall have the right and
power to receive, endorse, and collect all checks and other orders for the
payment of money made payable to the Pledgor representing any dividend or other
distribution payable in respect of the Pledged Securities or any part thereof
and to give full discharge for the same.
8. Securities Act, etc. In view of the position of the
Pledgor in relation to the Pledged Securities, or because of other present or
future circumstances, a question may arise under the Securities Act of 1933, as
amended, as now or hereafter in effect, or any similar statute hereafter
enacted analogous in purpose or effect (such Act and any such similar statute
as from time to time in effect being hereinafter called the "Federal Securities
Laws"), with respect to any disposition of the Pledged Securities permitted
hereunder. The Pledgor understands that compliance with the Federal Securities
Laws may very strictly limit the course of conduct of the Agent if the Agent
were to attempt to dispose of all or any part of the Pledged Securities, and
may also limit the extent to which or the manner in which any subsequent
transferee of any Pledged Securities may dispose of the same. Similarly, there
may be other legal restrictions or limitations affecting the Agent in any
attempt to dispose of all or any part of the Pledged Securities under
applicable "Blue Sky" or other state securities laws, or similar laws analogous
in purpose or effect. Under applicable law, in the absence of an agreement to
the contrary, the Agent may be held to have certain general duties and
obligations to the Pledgor to make some effort
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towards obtaining a fair price even though the Obligations may be discharged or
reduced by the proceeds of a sale at a lesser price. The Pledgor hereby agrees
that the Agent shall not have any such general duty or obligation to it, and
the Pledgor will not attempt to hold the Agent responsible for selling all or
any part of the Pledged Securities at an inadequate price, even if the Agent
shall accept the first offer received or does not approach more than one
possible purchaser. Without limiting the generality of the foregoing, the
provisions of this Section 8 would apply if, for example, the Agent were to
place all or any part of the Pledged Securities for private placement by an
investment banking firm, or if such investment banking firm purchased all or
any part of the Pledged Securities for its own account, or if the Agent placed
all or any part of the Pledged Securities privately with a purchaser or
purchasers.
9. Termination. The pledge hereunder shall terminate when
all of the Obligations and all amounts payable to the Guarantors under the
Guaranty Agreement shall have been fully paid and the Commitments have
terminated. At such time the Agent shall, at the sole cost and expense of the
Pledgor, assign and deliver to the Pledgor, or to such person or persons as the
Pledgor shall designate, against receipt, such of the Pledged Securities (if
any) as shall not have been sold or otherwise applied by the Agent pursuant to
the terms hereof and shall still be held by it hereunder, together with
appropriate instruments of reassignment and release. Any such reassignment
shall be without recourse upon or warranty by the Agent (except as to acts of
the Agent or persons claiming through the Agent).
10. Notices. All demands, notices and other communications
which any party hereto may desire or may be required to give to any other party
hereunder shall be in writing (including telegraphic communication) and shall
be mailed, telegraphed or delivered to such other party at its address on the
signature pages hereto or to any such party at such other address as shall be
designated by such party in a written notice to the other party, complying as
to delivery with the terms of this Section 10. All such demands, notices and
other communications shall be effective when received or five business days
after mailing, whichever is earlier.
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11. SERVICE OF PROCESS. THE PLEDGOR (A) HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF THE STATE COURTS OF THE STATE OF NEW YORK AND TO
THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK FOR THE PURPOSE OF ANY SUIT, ACTION, OR OTHER PROCEEDING ARISING
OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF BROUGHT BY THE
AGENT OR ITS SUCCESSORS OR ASSIGNS AND (B) HEREBY WAIVES, AND AGREES NOT TO
ASSERT, BY WAY OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION,
OR PROCEEDING, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION
OF THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM
ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION, OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION, OR PROCEEDING IS
IMPROPER OR THAT THIS AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE
ENFORCED IN OR BY SUCH COURT, AND (C) HEREBY WAIVES IN ANY SUCH SUIT, ACTION,
OR PROCEEDING ANY OFFSETS OR COUNTERCLAIMS WHICH ARE UNRELATED TO THE
TRANSACTIONS CONTEMPLATED HEREIN. THE PLEDGOR HEREBY CONSENTS TO SERVICE OF
PROCESS BY REGISTERED MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN.
THE PLEDGOR AGREES THAT ITS SUBMISSION TO JURISDICTION AND ITS CONSENT TO
SERVICE OF PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF THE LENDERS.
FINAL JUDGMENT AGAINST THE PLEDGOR IN ANY SUCH SUIT, ACTION, OR PROCEEDING
SHALL BE CONCLUSIVE, AND MAY BE ENFORCED IN OTHER JURISDICTIONS (A) BY SUIT,
ACTION, OR PROCEEDING ON THE JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL
BE CONCLUSIVE EVIDENCE OF THE FACT AND OF THE AMOUNT OF ANY INDEBTEDNESS OR
LIABILITY OF THE PLEDGOR THEREIN DESCRIBED OR (B) IN ANY OTHER MANNER PROVIDED
BY OR PURSUANT TO THE LAWS OF SUCH OTHER JURISDICTION; PROVIDED, HOWEVER, THAT
THE AGENT MAY AT ITS OPTION BRING SUIT, OR INSTITUTE OTHER JUDICIAL PROCEEDINGS
AGAINST THE PLEDGOR OR ANY OF ITS ASSETS IN ANY STATE OR FEDERAL COURT OF THE
UNITED STATES OR OF ANY COUNTRY OR PLACE WHERE THE PLEDGOR OR SUCH ASSETS MAY
BE FOUND. THE PLEDGOR FURTHER COVENANTS AND AGREES THAT SO LONG AS THIS
AGREEMENT SHALL BE IN EFFECT, IT SHALL MAINTAIN A DULY APPOINTED AGENT FOR THE
RECEIPT AND ACCEPTANCE ON ITS BEHALF OF SERVICE OF SUMMONS AND OTHER LEGAL
PROCESSES, AND UPON FAILURE TO DO SO THE CLERK OF EACH COURT TO WHOSE
JURISDICTION IT HAS SUBMITTED SHALL BE DEEMED TO BE ITS RESPECTIVE DESIGNATED
AGENT UPON WHOM SUCH PROCESS MAY BE SERVED ON ITS BEHALF, AND NOTIFICATION BY
THE ATTORNEY FOR THE PLAINTIFF, COMPLAINANT OR PETITIONER THEREIN BY MAIL.
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12. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW WHICH CANNOT BE WAIVED, THE PLEDGOR HEREBY WAIVES, AND COVENANTS
THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY
RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND,
ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE
SUBJECT MATTER HEREOF, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING
OR WHETHER IN CONTRACT OR TORT OR OTHERWISE. THE PLEDGOR ACKNOWLEDGES THAT IT
HAS BEEN INFORMED THAT THE PROVISIONS OF THIS SECTION 12 CONSTITUTE A MATERIAL
INDUCEMENT UPON WHICH THE OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY
IN ENTERING INTO THIS AGREEMENT. THE PARTIES HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 12 WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE PLEDGOR TO THE WAIVER OF ITS RIGHTS TO TRIAL BY JURY.
13. CHOICE OF LAW. THIS AGREEMENT AND ANY INSTRUMENT OR
AGREEMENT REQUIRED HEREUNDER SHALL BE DEEMED TO BE MADE UNDER, SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
14. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
15. Further Assurances. The Pledgor, at its own expense,
will execute and deliver, from time to time, any and all further, or other,
instruments, and perform such acts, as the Agent may reasonably request to
effect the purposes of this Agreement and to secure to the Agent for the
ratable benefit of the Lenders, the benefits of all rights, authorities, and
remedies conferred upon the Agent and the Lenders by the terms of this
Agreement.
16. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall
constitute an original for all purposes, but all such counterparts taken
together shall constitute the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
[NAME OF SUBSIDIARY]
By:________________________
Name:
Title:
Address:
CHEMICAL BANK
By:________________________
Name:
Title:
Address:
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SCHEDULE 1
Pledged Affiliates
268
SCHEDULE 2
Pledged Securities
Pledged Affiliate Stock Certificate No. No. of Shares
----------------- --------------------- -------------
269
EXHIBIT D-4
FORM OF
SUPPLEMENT NO. __ TO THE PLEDGE
AGREEMENT DATED AS OF NOVEMBER 1, 1995
WHEREAS, Orion Pictures Corporation, a Delaware
corporation (the "Borrower") is party to a Credit, Security and Guaranty
Agreement dated as of November 1, 1995 (as such agreement may be amended,
supplemented or otherwise modified, renewed or replaced from time to time, the
"Credit Agreement") among the Borrower, the guarantors referred to therein, the
lenders referred to therein (the "Lenders") and Chemical Bank as agent for the
Lenders (in such capacity, the "Agent"). All terms not otherwise defined in
this Pledge Agreement Supplement are used herein as defined in the Credit
Agreement;
WHEREAS, the Pledgor is a party to a Pledge
Agreement, dated as of November 1, 1995 (as the same has been, or may hereafter
be, amended or supplemented from time to time, the "Pledge Agreement");
WHEREAS, the Pledgor [HAS ACQUIRED OR HAS FORMED] a
Subsidiary (the "New Subsidiary") since the date of execution of the Pledge
Agreement and the most recent Supplement thereto and the Pledgor desires to
enter into this Supplement in order to pledge all of the equity securities of
such New Subsidiary which the Pledgor now owns beneficially and of record;
WHEREAS, Pledgor owns beneficially and of record
[__%] of the issued and outstanding shares of the capital stock of the New
Subsidiary;
THEREFORE,
A. The Pledgor does hereby pledge, hypothecate,
assign, transfer, set over and deliver unto the Agent (for the
benefit of the Lenders), a continuing security interest
270
in the Pledged Securities (as such term is defined in the
Pledge Agreement as supplemented hereby).
B. Each of Schedule 1 and Schedule 2 to the
Pledge Agreement is hereby supplemented, effective as of the
date hereof, so as to reflect the pledge of the equity
securities of the New Subsidiary. Attached hereto is Schedule
1 and Schedule 2, each supplemented to reflect the pledge of
the Pledged Securities of the New Subsidiary which Schedules
shall supersede any prior Schedules so delivered.
Except as expressly supplemented hereby, the Pledge
Agreement shall continue in full force and effect in accordance with the
provisions thereof on the date hereof. As used in the Pledge Agreement, the
terms "Agreement", "this Agreement", "this Pledge Agreement", "herein",
"hereafter", "hereto", "hereof" and words of similar import, shall, unless the
context otherwise requires, mean the Pledge Agreement as supplemented by this
Supplement.
Except as expressly supplemented hereby, the Pledge
Agreement, all documents contemplated thereby and any previously executed
Supplements thereto, are each hereby confirmed and ratified by the Pledgor.
The execution of this Supplement, and the addition of
the New Subsidiary to the Pledge Agreement are not intended by the parties to
derogate from, or extinguish, any of the Agent's rights or remedies under (i)
the Pledge Agreement and/or any agreement, amendment or supplement thereto or
any other instrument executed by the Pledgor or (ii) any financing statement,
continuation statement or other instrument executed by the Pledgor.
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271
IN WITNESS WHEREOF, the Pledgor has caused this
Supplement No. ___ to the Pledge Agreement to be duly executed officer as of
_____________, ____.
ORION PICTURES CORPORATION
By:_________________________
Name:
Title:
CHEMICAL BANK, as Agent
By:___________________________
Name:
Title:
Executed in
New York, New York
on _____________
3
272
SCHEDULE 1
Subsidiaries
[REVISE]
4
273
SCHEDULE 2
Pledged Securities
[REVISE]
5
274
EXHIBIT E
FORM OF SUBORDINATION AGREEMENT
SUBORDINATION AGREEMENT dated as of
November 1, 1995 (as amended, supplemented,
otherwise modified, renewed or replaced from
time to time, the "Subordination Agreement")
among (i) Orion Pictures Corporation (the
"Obligor"), (ii) Metromedia International
Group, Inc., MetProductions, Inc. and
Metromedia International Telecommunications,
Inc., (collectively, the "Subordinated
Creditors") and (iii) Chemical Bank, as agent
for the Lenders referred to in the Credit
Agreement (the "Agent").
Introductory Statement
Pursuant to the terms of a Credit, Security and Guaranty
Agreement dated as of November 1, 1995 among the Obligor, the lenders referred
to therein (the "Lenders"), and the Agent (the "Credit Agreement") the Lenders
have agreed, subject to the terms and conditions thereof, to make loans (the
"Loans") to the Obligor. The Credit Agreement, the Notes referred to therein,
any Interest Rate Protection Agreement or Currency Agreement entered into with
any Lender and the other documents, instruments and agreements contemplated
thereby as they may be amended or otherwise modified from time to time, shall
hereinafter be referred to as "Senior Obligation Documents". For purposes of
this Subordination Agreement, unless otherwise defined herein, capitalized
terms used herein shall have the meanings given to such terms in the Credit
Agreement.
The Subordinated Creditors have previously made loans to the
Obligor, and may from time to time hereafter make additional loans to the
Obligor. The obligations of the Obligor to repay the principal amount of any
loans and all interest thereon and all other amounts payable to the
Subordinated
275
Creditors in connection therewith are hereinafter referred to as the
"Subordinated Obligations". Any promissory note evidencing any such loan, any
replacements or substitutes therefore and any other related agreement are
hereinafter referred to as "Junior Obligation Documents".
In order to induce the Agent and the Lenders to enter into the
Credit Agreement, the Subordinated Creditors have agreed, subject to the
provisions of this Subordination Agreement, that the Subordinated Obligations
shall be subordinate to the Senior Obligations (as hereinafter defined).
NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. Agreement to Subordinate. The Subordinated Creditors
agree that the Subordinated Obligations are and shall be subordinate and
subject in right of payment, to the extent and in the manner hereinafter set
forth, to the prior payment in full of the Senior Obligations and that any
guarantees, security interests, mortgages and other liens securing payment of
the Subordinated Obligations are and shall be subordinate, to the fullest
extent permitted by law and as hereinafter set forth, to any guarantees,
security interests and mortgages and other liens securing payment of the Senior
Obligations, notwithstanding the perfection, order of perfection or failure to
perfect, any such security interest or other lien, or the filing or recording,
order of filing or recording, or failure to file or record this Subordination
Agreement or any instrument or other document in any filing or recording office
in any jurisdiction. The term "Senior Obligations" shall mean all obligations
of the Obligors under the Senior Obligation Documents including, without
limitation, whether outstanding at the date hereof or hereafter incurred or
created, all obligations to pay principal, premium, if any, interest
(including, without limitation, interest accruing after the commencement of any
bankruptcy, insolvency, reorganization or similar proceedings with respect to
the Obligor, whether or not determined to be an allowed claim in any such
proceeding), charges, costs, expenses and fees including, without limitation,
the disbursements and reasonable fees of counsel to the Agent or the Lenders,
all obligations to reimburse or indemnify the Agent and/or any Lender in any
way, and all
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renewals, extensions, restructurings, refinancings or refunding of any
indebtedness under the Senior Obligation Documents in the nature of a "workout"
or otherwise.
The expressions "prior payment in full", "payment in full",
"paid in full" or any other similar term(s) or phrase(s) when used herein with
respect to Senior Obligation Documents shall mean the payment in full, in cash,
of all of the Senior Obligations and the termination of the Commitments.
2. Restrictions on Payment of the Subordinated
Obligations, etc. The Subordinated Creditors will not ask, demand, sue for,
take or receive, directly or indirectly, from the Obligor or any affiliate
thereof, in cash or other property, by set-off, by realizing upon collateral,
by foreclosing on any lien or otherwise, by exercise of any remedies or rights
under the Junior Obligation Documents or by executions, garnishments, levies,
attachments or by any other action relating to the Subordinated Obligations, or
in any other manner, payment of, or additional security for, all or any part of
the Subordinated Obligations unless and until the Senior Obligations shall have
been paid in full. The Obligor will not make any payment on any of the
Subordinated Obligations, or take any other action, in contravention of the
provisions of this Subordination Agreement. The Subordinated Creditors
expressly agree that, unless and until such time as the Loans shall be
accelerated, any payment in respect of the Subordinated Obligations which is
not made in a timely manner by reason of the provisions of this Subordination
Agreement shall be deemed to be deferred until such time as payment can be made
in compliance with this Subordination Agreement and the Obligors shall not be
in default under any of the Junior Obligation Documents by reason thereof.
Each Subordinated Creditor further acknowledges and agrees
that it will not take any collateral of the Obligor unless and until the Senior
Obligations have been paid in full.
3. Additional Provisions Concerning Subordination. The
Subordinated Creditors and the Obligor agree as follows:
a. In the event of (i) any dissolution, winding up,
liquidation or reorganization of the Obligor (whether voluntary or involuntary
and whether in bankruptcy, insolvency or
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receivership proceedings, or upon an assignment for the benefit of creditors or
proceedings for voluntary or involuntary liquidation, dissolution or other
winding up of the Obligor, whether or not involving insolvency or bankruptcy,
or any other marshalling of the assets and liabilities of the Obligor or
otherwise); or (ii) any Event of Default (as such term is defined in the Credit
Agreement) which has not been waived or cured or an event which with notice
and/or passage of time would constitute an Event of Default (as such term is
defined in the Credit Agreement) which has not been waived or cured, or
acceleration of maturity regarding the Subordinated Obligations:
(1) all Senior Obligations shall first be paid to
the Agent for the benefit of the Lenders in full before any
payment or distribution is made upon the principal of or
interest on or any fees, costs, charges or expenses in
connection with the Subordinated Obligations, and before any
other action described in Sections 2 and 4 hereof is taken by
the Subordinated Creditors; and
(2) any payment or distribution of assets of the
Obligor, whether in cash, property or securities to which the
Subordinated Creditors would be entitled except for the
provisions hereof, shall be paid or delivered by the Obligor,
or any receiver, trustee in bankruptcy, liquidating trustee,
disbursing agent, agent or other person making such payment or
distribution, directly to the Agent for the benefit of the
Lenders, to the extent necessary to pay in full all Senior
Obligations remaining unpaid, after giving effect to any
concurrent payment or distribution to the Agent for the
benefit of the Lenders before any payment or distribution is
made to the Subordinated Creditors;
b. In any proceeding referred to or resulting from any event
referred to in subsection (a) of this Section 3 commenced by or against the
Obligor:
(1) the Agent may, and is hereby irrevocably
authorized and empowered (in its own name or in the name of
the Subordinated Creditors or otherwise), but shall have no
obligation to, (i) demand, sue for,
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collect and receive every payment or distribution referred to
in subsection (a) of this Section 3 and give acquittance
therefor, (ii) file claims and proofs of claim in the name of
the Subordinated Creditors in respect of the Subordinated
Obligations, but only if the Subordinated Creditors have not
filed any claims or proofs of claim with respect to the
Subordinated Obligations before the expiration of the time to
file such, and (iii) take such other action as the Agent may
deem necessary or advisable for the exercise or enforcement of
any of the rights or interests of the Agent and the Lenders
hereunder; and
(2) the Subordinated Creditors will duly and
promptly take such action as the Agent may reasonably request
to collect the Subordinated Obligations for the account of the
Agent and to file appropriate claims or proofs of claim with
respect thereto, to execute and deliver to the Agent such
powers of attorney, assignments or other instruments as the
Agent may request in order to enable it to enforce any and all
claims with respect to the Subordinated Obligations, and to
collect and receive any and all payments or distributions
which may be payable or deliverable upon or with respect to
the Subordinated Obligations;
c. All payments or distributions upon or with respect to
the Subordinated Obligations which are received by the Subordinated Creditors
contrary to the provisions of this Subordination Agreement shall be deemed to
be the property of the Agent, shall be received in trust for the benefit of the
Agent, shall be segregated from other funds and property held by the
Subordinated Creditors and shall be forthwith paid over to the Agent for the
benefit of the Lenders in the same form as so received (with any necessary
endorsement) to be applied to the payment or prepayment of the Senior
Obligations until the Senior Obligations shall have been paid in full;
d. The Subordinated Creditors hereby waive any requirement
for marshalling of assets by the Agent in connection with any foreclosure of
any lien of the Agent under the Senior Obligation Documents;
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e. The Subordinated Creditors shall not take any action to
impair or otherwise adversely affect the foreclosure of, or other realization
of the Agent's rights under the Senior Obligation Documents; and
f. The Agent is hereby authorized to demand specific
performance of this Subordination Agreement at any time when the Subordinated
Creditors shall have failed to comply with any of the provisions of this
Subordination Agreement, and the Subordinated Creditors hereby irrevocably
waive any defense based on the adequacy of a remedy at law which might be
asserted as a bar to such remedy of specific performance.
4. Subrogation. Subject to the payment in full of (x)
all Senior Obligations and (y) the (i) subrogation rights of Metromedia Company
and ▇▇▇▇ ▇. ▇▇▇▇▇ under the Guaranty Agreement and (ii) the provisions of the
Priority and Contribution Agreement to the extent of payments received by the
Agent for application against the Senior Obligations which would be payable to
the Subordinated Creditors for application against the Subordinated Obligations
but for the provisions of this Subordination Agreement, the Subordinated
Creditors shall be subrogated to the rights of the Agent and the Lenders to
receive payments or distributions of cash, property or securities of the
Obligor applicable to the Senior Obligations until the principal of (and
premium, if any) and interest on the Subordinated Obligations shall be paid in
full; and, for the purposes of such subrogation, no payments or distributions
to the Agent and the Lenders of any cash, property or securities to which the
Subordinated Creditors would be entitled except for the provisions of this
Section, and no payments over to the Agent and the Lenders pursuant to the
provisions of this Subordination Agreement by the Subordinated Creditor, shall,
as between, the Obligor, its creditors other than the Agent and the Lenders,
and the Subordinated Creditors, be deemed to be a payment by the Obligor to or
on account of the Senior Obligations. The Subordinated Creditors agree that no
payment or distribution to the Agent for the benefit of the Lenders pursuant to
the provisions of this Subordination Agreement shall entitle the Subordinated
Creditors to exercise any rights of subrogation in respect thereof until the
Senior Obligations shall have been paid in full.
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5. Assignment and Pledge of Subordinated Obligations.
As security for the payment of all Senior Obligations and for performance by
the Subordinated Creditors of this Subordination Agreement, the Subordinated
Creditors do hereby transfer, assign and pledge to the Agent for the benefit of
the Lenders, and grant to the Agent for the benefit of the Lenders a security
interest in, all right, title and interest of the Subordinated Creditors in and
to the Subordinated Obligations together with any collateral security at any
time held or received therefor, with all of the rights therein and thereto of
the Subordinated Creditors including the right on the part of the Agent to
collect and enforce the Subordinated Obligations by suit, proof of debt or
claim in any proceeding under the Bankruptcy Code or any amendments thereto, or
in any dissolution, insolvency, liquidation or other proceeding involving an
adjustment of the indebtedness of the Obligor on the Subordinated Obligations
or application of the assets of the Obligor to the payment in liquidation
thereof, or otherwise. The Agent, in its own name or on behalf of the
Subordinated Creditors as holder of the Subordinated Obligations, may accept or
reject any plan of reorganization, readjustment, or compromise or otherwise.
The Subordinated Creditors and the Obligor further agree that
at no time hereafter will any part of the Subordinated Obligations be
represented by any negotiable instruments or other writings, unless such
negotiable instruments or other writings are delivered to the Agent, duly
endorsed, or assigned by the Subordinated Creditors, if payable to the
Subordinated Creditors. In the event of the failure of the Subordinated
Creditors to endorse said negotiable instruments or other writings, the Agent
is hereby irrevocably constituted and appointed attorney-in-fact for the
Subordinated Creditors with full power to make any such endorsements.
6. Legend. Each of the Subordinated Creditors and the
Obligor will cause each promissory note evidencing any of the Subordinated
Obligations, any replacement thereof and any mortgage or security document
relating thereto to include or have endorsed thereon the following provision:
"The indebtedness evidenced or secured by this
instrument is subordinated to other indebtedness pursuant to,
and to the extent provided in, and is
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otherwise subject to the terms of, the Subordination Agreement
dated as of November 1, 1995 by and among (i) Orion Pictures
Corporation, as Obligor, (ii) Metromedia International Group,
Inc., MetProductions, Inc. and Metromedia International
Telecommunications, Inc., as Subordinated Creditors and (iii)
Chemical Bank, as Agent for the Lenders."
7. Negative Covenants of the Subordinated Creditors. So long
as any of the Senior Obligations shall remain outstanding, the Subordinated
Creditors will not, without the prior written consent of the Agent:
a. Sell, assign, pledge, encumber or otherwise dispose of any
instrument evidencing the indebtedness owed to the Subordinated Creditors or
any collateral securing the Subordinated Obligations unless such sale,
assignment, pledge, encumbrance or other disposition is made expressly subject
to this Subordination Agreement and the other party to such sale, assignment,
pledge, encumbrance or other disposition consents in writing to be bound by the
terms hereof;
b. Permit the terms of the Junior Obligation Documents or
collateral securing any Subordinated Obligations to be changed in any way which
would limit or impair these subordination provisions, increase the interest
payable thereon, change any payment date thereunder or accept any collateral;
c. Declare all or any portion of the Subordinated Obligations
due and payable prior to the date fixed therefor or realize upon, or otherwise
exercise any remedies with respect to, any collateral securing the Subordinated
Obligations or take any other action described in Section 2 hereof; or
d. Commence, or join with any creditor other than the Lenders
in commencing any proceeding referred to in Section 3(a) hereof.
8. Obligations Unconditional. All rights and interests of
the Agent and the Lenders hereunder, and all agreements and obligations of the
Subordinated Creditors and the Obligor hereunder, shall remain in full force
and effect irrespective of:
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a. Any lack of validity or enforceability of any Senior
Obligation Document or any other agreement or instrument relating thereto;
b. Any change in the time, manner or place of payment of, or
in any other term of, all or any of the Senior Obligations, or any other
amendment or waiver of or any consent to departure from any Senior Obligation
Document;
c. Any exchange, release or nonperfection of any collateral,
or any release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the Senior Obligations;
d. Any other circumstances which might otherwise constitute a
defense available to, or a discharge of, the Obligor in respect of the Senior
Obligations or of the Subordinated Creditors or the Obligor in respect of this
Subordination Agreement; or
e. Further subordinate the Subordinated Obligations.
9. Additional Agreements and Waivers by the Subordinated
Creditors. The Subordinated Creditors waive, to the fullest extent permitted
by law, any right to request marshalling of assets or equitable subordination
(whether under or pursuant to 11 U.S.C. Section 510 or otherwise) and any
right to assert that the Agent or any Lender has in any way failed to comply
with the provisions of the Uniform Commercial Code, including the provisions
of Article 9 thereof.
10. Representations and Warranties. Each Subordinated
Creditor hereby represents and warrants that:
a. such Subordinated Creditor has the power and authority and
the legal right to execute and deliver, and to perform its obligations
under, this Subordination Agreement, and has taken all necessary
action to authorize the execution, delivery and performance of this
Subordination Agreement;
b. this Subordination Agreement constitutes a legal, valid and
binding obligation of such Subordinated Creditor
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enforceable in accordance with its terms, except as affected by
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting the
enforcement of creditors' rights generally, general equitable
principles and an implied covenant of good faith and fair dealing;
c. the execution, delivery and performance of this
Subordination Agreement will not violate in any material respect any
provision of any Applicable Law or any agreement to which such
Subordinated Creditor is a party;
d. no consent or authorization of, filing with, or other act
by or in respect of, any arbitrator or Governmental Authority and no
consent of any other Person (including, without limitation, any
partner, stockholder or creditor of such Subordinated Creditor) is
required in connection with the execution, delivery, performance,
validity or enforceability of this Subordination Agreement;
e. no litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority is pending or, to the
knowledge of such Subordinated Creditor, threatened by or against such
Subordinated Creditor with respect to this Subordination Agreement;
f. the agreements governing the Subordinated Obligations of
such Subordinated Creditor do not and will not contain (i) any default
which is triggered by (A) a default under any other agreements to
which the Obligor is a party or (B) any other Indebtedness of the
Obligor being declared due and payable prior to its stated maturity or
(ii) without limiting clause (i) above, any covenants or events of
default which are more strict than those contained in the Credit
Agreement; and
g. such Subordinated Creditor is an Affiliate of the Obligors
and the Subordinated Obligations are permitted by Section 6.1 of the
Credit Agreement.
11. Present Subordinated Obligations. Each of the
Subordinated Creditors hereby represents and warrants that the
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outstanding Subordinated Obligations as of the this date are $______.
12. Further Assurances. The Subordinated Creditors and the
Obligor will, at their own expense and at any time and from time to time,
promptly execute and deliver all further instruments and documents, and take
all further action that the Agent may reasonably request, in order to perfect
or otherwise protect any right or interest granted or purported to be granted
hereby or to enable the Agent to exercise and enforce its rights and remedies
hereunder. The Subordinated Creditors further authorize the Agent to file UCC
financing statements and any amendments thereto or continuations thereof with
regard to the Subordinated Obligations without the Subordinated Creditors'
signatures.
13. Expenses. The Obligor agrees to pay to the Agent, upon
demand, the amount of any and all reasonable expenses, including the reasonable
fees and expenses of counsel for the Agent, which the Agent may incur in
connection with the exercise or enforcement against the Subordinated Creditors
of any of the rights or interests of the Agent or the Lenders hereunder.
14. Notice. All demands, notices and other communications
which any party hereto may desire or may be required to give to any other party
hereunder shall be in writing (including telegraphic communication) and shall
be mailed, telecopied, telegraphed or delivered to such other party at its
address as set forth on the signature pages hereof or to any such party at such
other address as shall be designated by such party in a written notice to each
other party, complying as to delivery with the terms of this Section 14. All
such demands, notices, and other communications shall be effective when
received.
15. SERVICE OF PROCESS. EACH OF THE SUBORDINATED CREDITORS
AND THE OBLIGOR (A) HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE
COURTS OF THE STATE OF NEW YORK AND THE JURISDICTION OF THE UNITED STATE
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, FOR THE PURPOSE OF ANY
SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON THIS
SUBORDINATION AGREEMENT OR THE SUBJECT MATTER HEREOF BROUGHT BY THE AGENT OR
ITS SUCCESSORS OR ASSIGNS AND (B) HEREBY WAIVES AND AGREES NOT TO ASSERT, BY
WAY OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH
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SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE
JURISDICTION OF THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE
FROM ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN
AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER OR THAT THIS SUBORDINATION AGREEMENT OR THE SUBJECT MATTER HEREOF MAY
NOT BE ENFORCED IN OR BY SUCH COURT, AND (C) HEREBY WAIVES IN ANY SUCH ACTION,
SUIT OR PROCEEDING ANY OFFSETS OR COUNTERCLAIMS (EXCEPT FOR COMPULSORY
COUNTERCLAIMS). EACH OF THE SUBORDINATED CREDITORS AND THE OBLIGOR HEREBY
CONSENTS TO SERVICE OF PROCESS BY REGISTERED MAIL AT THE ADDRESS TO WHICH
NOTICES ARE TO BE GIVEN. EACH OF THE SUBORDINATED CREDITORS AND THE OBLIGOR
AGREES THAT ITS SUBMISSION TO JURISDICTION AND ITS CONSENT TO SERVICE OF
PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF THE AGENT. FINAL JUDGMENT
AGAINST THE SUBORDINATED CREDITORS OR THE OBLIGOR IN ANY SUCH ACTION, SUIT OR
PROCEEDING SHALL BE CONCLUSIVE, AND MAY BE ENFORCED IN OTHER JURISDICTIONS (A)
BY SUIT, ACTION OR PROCEEDING ON THE JUDGMENT, A CERTIFIED OR TRUE COPY OF
WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE FACT AND OF THE AMOUNT OF ANY
INDEBTEDNESS OR LIABILITY OF THE SUBORDINATED CREDITORS OR THE OBLIGOR THEREIN
DESCRIBED OR (B) IN ANY OTHER MANNER PROVIDED BY OR PURSUANT TO THE LAWS OF
SUCH OTHER JURISDICTION; PROVIDED, HOWEVER, THAT THE AGENT MAY AT ITS OPTION
BRING SUIT, OR INSTITUTE OTHER JUDICIAL PROCEEDINGS AGAINST THE SUBORDINATED
CREDITORS OR THE OBLIGOR OR ANY OF THEIR RESPECTIVE ASSETS IN ANY STATE OR
FEDERAL COURT OF THE UNITED STATES OR OF ANY COUNTRY OR PLACE WHERE THE
SUBORDINATED CREDITORS, THE OBLIGOR OR THEIR RESPECTIVE ASSETS MAY BE FOUND.
EACH OF THE SUBORDINATED CREDITORS AND THE OBLIGOR FURTHER COVENANTS AND AGREES
THAT SO LONG AS THIS SUBORDINATION AGREEMENT SHALL BE IN EFFECT, EACH SHALL
MAINTAIN A DULY APPOINTED AGENT FOR THE RECEIPT AND ACCEPTANCE ON ITS BEHALF OF
SERVICE OF SUMMONS AND OTHER LEGAL PROCESSES, AND UPON FAILURE TO DO SO THE
CLERK OF EACH COURT TO WHOSE JURISDICTION IT HAS SUBMITTED SHALL BE DEEMED TO
BE ITS RESPECTIVE DESIGNATED AGENT UPON WHOM SUCH PROCESS MAY BE SERVED ON ITS
BEHALF, AND NOTIFICATION BY THE ATTORNEY FOR PLAINTIFF, COMPLAINANT OR
PETITIONER THEREIN BY MAIL OR TELEGRAPH TO ANY SUBORDINATED CREDITOR OR THE
OBLIGOR OF THE FILING OF EACH SUIT, ACTION OR PROCEEDING SHALL BE DEEMED
SUFFICIENT NOTICE THEREOF.
16. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY
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HERETO HEREBY WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS
PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN
RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF
OR BASED UPON THIS SUBORDINATION AGREEMENT OR THE SUBJECT MATTER HEREOF, IN
EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING OR WHETHER IN CONTRACT OR
TORT OR OTHERWISE. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED
THAT THE PROVISIONS OF THIS SECTION 16 CONSTITUTE A MATERIAL INDUCEMENT UPON
WHICH THE OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO
THIS SUBORDINATION AGREEMENT. THE PARTIES HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 16 WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF SUCH OTHER PARTY TO THE WAIVER OF ITS RIGHTS TO TRIAL BY JURY.
17. Miscellaneous.
a. No amendment of any provision of this Subordination
Agreement shall be effective unless it is in writing and signed by the
Subordinated Creditors, the Obligor and the Agent, and no waiver of any
Subordination Agreement, and no consent to any departure therefrom, shall be
effective unless it is in writing and signed by the Agent, and any such waiver
or consent shall be effective only in the specific instance and for the
specific purpose for which given.
b. No failure on the part of the Agent to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right.
c. Any provision of this Subordination Agreement which is
prohibited or unenforceable in any jurisdiction, shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or invalidity
without invalidating the remaining portions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
d. This Subordination Agreement shall be binding on the
Subordinated Creditors and the Obligor and their respective successors and
assigns including, without limitation, any holders of the instruments
evidencing the Subordinated Obligations.
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e. This Subordination Agreement, and any modifications or
amendments hereto, may be executed by one or more of the parties to this
Subordination Agreement on any number of separate counterparts, and all said
counterparts taken together shall be deemed to constitute one and the same
instrument.
f. This Subordination Agreement and any supplement or
agreement required hereunder shall be governed by and construed in accordance
with the laws of the State of New York without regard to principles of
conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have executed this
Subordination Agreement on the date first above written.
OBLIGOR:
ORION PICTURES CORPORATION
By_________________________
Name:
Title:
Address: 1888 Century Park East
Los Angeles, CA 90067
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
SUBORDINATED CREDITORS:
METROMEDIA
INTERNATIONAL GROUP, INC.
By_________________________
Name:
Title:
Address:
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METPRODUCTIONS, INC.
By_________________________
Name:
Title:
Address:
METROMEDIA INTERNATIONAL
TELECOMMUNICATIONS, INC.
By_________________________
Name:
Title:
Address:
CHEMICAL BANK,
as Agent
Executed in New York, New
York on ________, 1995
By_________________________
Name:
Title:
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, III
with a copy to:
CBC-USA, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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EXHIBIT F
FORM OF LABORATORY ACCESS LETTER
[DATE]
[ADDRESS TO LABORATORY]
This letter will confirm the terms of an agreement among you (the
"Laboratory"), [INSERT THE NAME OF THE CREDIT PARTY THAT HAS ACCESS RIGHTS TO
THE PHYSICAL ELEMENTS OF THE PRODUCT LISTED ON SCHEDULE 1 HERETO] (the
"Producer") and Chemical Bank as agent for the Lenders referred to in the
Credit Agreement hereinafter defined (the "Agent") relating to the items of
Product (the "Product") described on Schedule 1 hereto.
Reference is hereby made to that certain Credit, Security, and
Guaranty Agreement dated as of November 1, 1995 among [ORION PICTURES
CORPORATION OR THE PRODUCER], [THE PRODUCER, AS A GUARANTOR,] the other
guarantors named therein, the Lenders named therein and the Agent (as the same
may be amended, supplemented or otherwise modified, renewed or replaced from
time to time, the "Credit Agreement").
The Laboratory now has or may have in its possession or under its
control certain of the negatives, dupe negatives, fine grain prints,
soundtracks, positive prints, video tape masters or other physical properties
in connection with the Product, whether or not in completed form (all of the
foregoing physical properties now or hereafter in the Laboratory's possession
or control are herein collectively referred to as the "Physical Materials").
The Producer now possesses certain rights in connection with the Product and
the Physical Materials, including, without limitation, rights of access with
respect to the Physical Materials (the "Access Rights").
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto hereby agree as follows:
290
1. The Laboratory ▇▇▇▇▇▇ agrees and confirms to the Agent that the
Producer is entitled to exercise the Access Rights with respect to the Physical
Materials. The Producer and the Agent hereby confirm to the Laboratory, and
the Laboratory hereby acknowledges, that in order to secure the Producer's
obligations under the Credit Agreement, the Producer has, pursuant to the
Credit Agreement, inter alia, granted to the Agent (for the benefit of the
Lenders) a security interest in and to the Producer's right, title and interest
in and to personal property, including without limitation, the Access Rights.
2. The parties hereto hereby agree that, upon written notice from the
Agent to the Laboratory that the Agent (on behalf of the Lenders) has exercised
its security interest with respect to Access Rights, the Laboratory shall
accord to the Agent (or the Agent's successors or assigns) the non-exclusive
right to exercise the Access Rights including, without limitation, the right to
have access to the Physical Materials and to order and receive from the
Laboratory (on the Laboratory's normal and customary terms) all materials and
services customarily rendered or furnished by the Laboratory in connection with
the Physical Materials.
3. Laboratory and the other parties hereto hereby agree (a) that
the Laboratory will not look to any party hereunder for payment of any charges
incurred by any other person or entity with respect to the Product(s) or the
Physical Materials (it being understood and agreed that all services or
materials ordered by any party shall be at the sole cost and expense of the
party ordering the same) and (b) that, except for liens within the limits
provided in Paragraph 4: (i) the rights of any party hereunder (including,
without limitation, Agent's non-exclusive right to exercise the Access Rights)
shall not be affected, diminished, impeded or interfered with by reason of any
failure of any other person or entity to pay for any charges which have
heretofore been incurred or which may hereinafter be incurred in connection
with the Product(s) or the Physical Materials, and (ii) any claim or lien which
Laboratory may assert against any party hereto with respect to services or
materials furnished or rendered by Laboratory at the request of such party with
respect to the Product(s) or the Physical Materials will not interfere with any
other party's rights of access with respect to the Physical Materials or other
rights referred to hereunder.
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4. If the Laboratory shall have been notified by the Agent that
an Event of Default (as defined in the Credit Agreement) has occurred and is
continuing under the Credit Agreement, the parties hereto agree that they will
not agree to alter, amend, supplement, terminate or replace the Access Rights
without the prior written consent of Agent, and that the Physical Materials may
not be released to any other entity (including another laboratory) without
Agent's prior written consent.
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Kindly confirm your agreement to and acceptance of the foregoing
by signing in the space provided below.
Very truly yours,
[PRODUCER]
By:___________________________
Name:
Title:
AGREED AND ACCEPTED BY:
[LABORATORY]
By:_______________________
Name:
Title:
CHEMICAL BANK, as Agent
By:_______________________
Name:
Title:
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EXHIBIT G
FORM OF ASSIGNMENT AND ACCEPTANCE
Dated _____________, ____
Reference is made to the Credit, Security and Guaranty
Agreement dated as of November 1, 1995 (as the same may be amended,
supplemented or otherwise modified, renewed or replaced from time to time, the
"Agreement") among ORION PICTURES CORPORATION (the "Borrower"), the guarantors
named therein, the lenders named therein (the "Lenders") and Chemical Bank, as
agent for the Lenders (in such capacity, the "Agent"). Terms defined in the
Agreement are used herein with the same meaning.
____________________ (the "Assignor") and ____________ (the
"Assignee") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to
the Assignee without recourse to the Assignor, and the Assignee hereby
irrevocably purchases and assumes from the Assignor without recourse to the
Assignor, an undivided _____% interest (1) in and to all the Assignor's rights
and obligations under the Agreement as of the Effective Date (such term being
used herein as hereinafter defined) (including, without limitation, such
percentage interest in (a) the Commitment of the Assignor on the Effective
Date, (b) the outstanding Loans owing to the Assignor on the Effective Date,
together with all unpaid interest accrued to the Effective Date and (c) the
Assignor's participation in outstanding Letters of Credit as of the Effective
Date) provided, however, it is expressly understood and agreed that (x) the
Assignor is not assigning to the Assignee and the Assignor shall retain (i) all
of the Assignor's rights under Section 2.4(g) and 2.13 of the Agreement with
respect to any
____________________
(1) The amount of the Commitment to be assigned must be in the minimum
principal amount as set forth in Section 12.3(b) of the Agreement.
294
cost, reduction or payment incurred or made prior to the Effective Date
including, without limitation, the rights to indemnification and to
reimbursement for taxes, costs and expenses and (ii) any and all amounts paid
to the Assignor prior to the Effective Date and (y) both Assignor and Assignee
shall be entitled to the benefits of Sections 12.4 and 12.5 of the Agreement.
2. The Assignor (i) represents that as of the date
hereof (without giving effect to assignments thereof which have not yet become
effective) its Percentage under the Agreement is _____%, its Commitment under
the Agreement is $__________, the outstanding balance of its Loans is
$___________, and its Pro Rata Share of the current L/C Exposure is
$__________; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Agreement,
the Fundamental Documents or any other instrument or document furnished
pursuant thereto, other than that it is the legal and beneficial owner of the
interest being assigned by it hereunder and that such interest is free and
clear of any adverse claim; (iii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any of the
Credit Parties or the performance or observance by any of the Credit Parties of
any of its obligations under the Agreement or any other instrument or document
furnished pursuant thereto; and (iv) attaches the Notes held by it and requests
that the Agent exchange such Notes for new Notes payable to the Assignor (if
the Assignor has retained a Commitment under the Agreement) and new Notes
payable to the Assignee, in the respective amount(s) which reflect the
assignment being made hereby (and after giving effect to any other assignments
which have become effective on the Effective Date).
3. The Assignee (i) represents and warrants that it is
legally authorized to enter into this Assignment and Acceptance; (ii) confirms
that it has received a copy of the Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 5.1 thereof (or if no
such statements have been delivered as of the date hereof, pursuant to Section
3.4 thereof) and such other documents and
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information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (iii) agrees that it
will, independently and without reliance upon the Agent, the Assignor or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Agreement or any other Fundamental Document; (iv)
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under the Agreement as are delegated to the Agent
by the terms thereof, together with such powers as are reasonably incidental
thereto; (v) agrees that it will be bound by the provisions of the Agreement
and will perform in accordance with their terms all the obligations which by
the terms of the Agreement are required to be performed by it as a Lender; (vi)
agrees that it will keep confidential all information with respect to the
Credit Parties furnished to it by the Credit Parties or the Assignor (other
than information generally available to the public or otherwise available to
the Assignor on a non-confidential basis); and (vii) attaches the forms
prescribed by the Internal Revenue Service of the United States certifying as
to the Assignee's exemption from United States withholding taxes with respect
to all payments to be made to the Assignee under the Agreement or such other
documents as are necessary to indicate that all such payments are subject to
such tax at a rate reduced by any applicable tax treaty. (2)
4. The effective date for this Assignment and Acceptance
shall be ________________ (the "Effective Date"). (3) Following the execution of
this Assignment and Acceptance by the Assignee and the Assignor, it will be
delivered to the Agent for acceptance and recording by the Agent pursuant to
Section 12.3 of the Agreement.
____________________
(2) If the Assignee is organized under the laws of a jurisdiction outside the
United States.
(3) Such date shall be not earlier than five Business Days after the date of
acceptance and recording by the Agent.
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5. Upon such acceptance and recording, from and after
the Effective Date, (i) the Assignee shall be a party to the Agreement and, to
the extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and under the other Fundamental Documents
and shall be bound by the provisions thereof and (ii) the Assignor shall, to
the extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Agreement (and if this
Assignment and Acceptance covers all or the remaining portion of the Assignor's
rights and obligations under the Agreement, the Assignor shall cease to be a
party thereto).
6. Upon the acceptance and recording by the Agent, from
and after the Effective Date, the Agent shall make all payments in respect of
the interest assigned hereby (including payments of principal, interest, fees
and other amounts) to the Assignee whether such amounts have accrued prior to
the Effective Date or accrue subsequent to the Effective Date. The Assignor
and Assignee shall make all appropriate adjustments in payments made by the
Agent for periods prior to the Effective Date or with respect to the making of
this assignment directly between themselves.
7. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
8. This Assignment and Acceptance may be executed in
counterparts, each of which shall be deemed to constitute an original, but all
of which when taken together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be duly executed by their respective duly
authorized officers.
[NAME OF ASSIGNOR]
By____________________________
Name:
Title:
[NAME OF ASSIGNEE]
By____________________________
Name:
Title:
CONSENTED TO:
CHEMICAL BANK, As Agent
By:_____________________
Name:
Title:77
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EXHIBIT I
FORM OF COMPLIANCE CERTIFICATE
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected [INSERT TITLE OF AUTHORIZED
OFFICER] of Orion Pictures Corporation (the "Borrower");
2. I have reviewed the terms of the Credit, Security and
Guaranty Agreement dated as of November 1, 1995 (as the same may be amended,
supplemented or otherwise modified, renewed or replaced from time to time, the
"Credit Agreement"), among the Borrower, the Corporate Guarantors referred to
therein, the Lenders referred to therein, and Chemical Bank as Agent and as
Issuing Bank. The financial statements attached hereto fairly present the
financial condition of the Parent and its Consolidated Subsidiaries, including
the Borrower on a consolidated basis as at the dates indicated. Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in the Credit Agreement.
3. The examinations described in paragraph (2) did not
disclose the existence of any condition or event which constitutes an Event of
Default or Default during, or at the end of, the accounting period covered by
the attached financial statements or as of the date of this Certificate, except
as set forth in paragraph (4) below;
4. In the course of the performance of my duties, I have
made such examinations and investigations as are deemed necessary to express an
informed opinion whether any condition or event which would constitute an Event
of Default or Default. As of the date of this Certificate, I have no knowledge
of any such condition or event, except as set forth below:
Describe below (or in a separate attachment to this
Certificate) the exceptions, if any, to paragraphs (3) and (4) above by
listing, in detail, the nature of each condition or event, the period during
which it has existed and the action
299
which the Borrower has taken, is taking, or proposes to take, with respect to
each such condition or event:
________________________________________________________________________________
________________________________________________________________________________
5. Attached hereto, in reasonable detail, are the
computations and comparisons required to demonstrate in detail compliance with
the provisions of Sections 6.20, 6.22 and 6.23 of the Credit Agreement.
The foregoing certifications, together with the computations
and comparisons set forth in the attachments hereto and the financial
statements attached to this Certificate in support hereof, are made and
delivered this _____ day of __________, pursuant to Section 5.1 of the Credit
Agreement.
ORION PICTURES CORPORATION
By__________________________
Name:
Title:
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Attachments
1. financial statements; and
2. the computations and comparisons (in reasonable
detail) required to demonstrate compliance with the provisions of Sections
6.20, 6.22 and 6.23 of the Credit Agreement.
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EXHIBIT J
Form of Borrowing Base Certificate
as of ________________
The undersigned (the "Borrower") HEREBY CERTIFIES the
following information as of __________, _____ pursuant to the Credit, Security
and Guaranty Agreement dated as of November 1, 1995, among the Borrower, the
guarantors named therein, the lenders named therein and Chemical Bank as Agent
and as Issuing Bank, as the same may be amended, supplemented or otherwise
modified from time to time (herein called the "Credit Agreement"), the defined
terms therein being herein used with the same meanings:
ITEM (from detailed Amount Advance Borrowing
schedules attached) $000's Rate Base
------ ------ ---------
a. Other Receivables
which are guaranteed
by Metromedia ______x 100% = _________
b. Other Receivables
which are supported
by an Acceptable L/C ______x 100% = _________
c. Domestic
Receivables ______x 90% = _________
d. Foreign
Receivables ______x 85% = _________
e. Other Receivables
not included in
item (a) or (b)
above ______x 50% = _________
f. Library Credit ______x 100% = _________
g. Less Amounts
Payable to Third
Parties not Already
Deducted (________)
TOTAL BORROWING BASE
==========
MINUS
-----
Outstanding Term Loans _________
Total outstanding _________
Availability _________
302
The Borrower has no reason to believe that the aggregate principal
amount of all Term Loans outstanding as of the date of this certificate would
exceed the Borrowing Base if such Borrowing Base was computed as of the date of
this certificate.
IN WITNESS WHEREOF, the undersigned has caused this certificate to be
executed this day of , ____
ORION PICTURES CORPORATION
By____________________________
Name:
Title:
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EXHIBIT K
FORM OF BORROWING CERTIFICATE
The undersigned HEREBY CERTIFIES with respect to the Borrowing
to be made on the date indicated below pursuant to the Credit, Security and
Guaranty Agreement dated as of November 1, 1995, among Orion Pictures
Corporation (the "Borrower") the Corporate Guarantors named therein, the
Lenders named therein and Chemical Bank as Agent and as Issuing Bank (as the
same may be amended, supplemented or otherwise modified, renewed or replaced
from time to time, the "Credit Agreement"; capitalized terms used herein and
not otherwise defined shall have the meanings set forth in the Credit
Agreement) that:
(a) the representations and warranties contained in the
Credit Agreement are true and correct in all material respects on and
as of the date hereof (except to the extent that such representations
and warranties expressly relate to an earlier date) as if such
representations and warranties had been made on and as of the date
hereof;
(b) no Revolving Loan Default or Revolving Loan Event of
Default has occurred or is continuing, nor shall any such event occur
by reason of the making of the Loan(s) requested herein; and
(c) the Borrower requests [a] Loan(s) on the terms and
conditions as stated in the Credit Agreement and the related Notes:
(i) the requested Business Day of the Loan is
__________, ____; and
(ii) the type of Loan(s) requested, the amounts
thereof and the Interest Period(s), if a Eurodollar Loan is
requested, are as follows:
TYPE INTEREST PERIOD AMOUNT
---- --------------- ------
304
IN WITNESS WHEREOF, the undersigned has caused this certificate to be
executed this __ day of ____________, ____.
ORION PICTURES CORPORATION
By:_________________________
Name:
Title:
305
EXHIBIT L
FORM OF PRIORITY AND CONTRIBUTION AGREEMENT
This PRIORITY AND CONTRIBUTION AGREEMENT (as the same may be
amended, supplemented or otherwise modified, renewed or replaced from time to
time, the "Agreement") is entered into as of November 1, 1995 by and among
Orion Pictures Corporation (the "Borrower"), Metromedia Company, a Delaware
general partnership ("Metromedia"), ▇▇▇▇ ▇. ▇▇▇▇▇, a general partner of
Metromedia ("▇▇▇▇▇"; together with Metromedia, the "Parent Guarantors") and the
Corporate Guarantors which are party to the Credit Agreement (as hereinafter
defined) (such Corporate Guarantors together with the Borrower being referred
to herein collectively as the "Contributors" and individually as a
"Contributor") for the purpose of establishing the respective rights and
obligations of contribution among the Parent Guarantors and the Contributors in
connection with the Credit Agreement and the Guaranty (as hereinafter defined).
Capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Credit Agreement.
Recitals
WHEREAS, the Contributors have entered into a Credit, Security
and Guaranty Agreement dated as of November 1, 1995, with the lenders referred
to therein (the "Lenders") and Chemical Bank, as Agent and as Issuing Bank
(said agreement, as it may be amended, supplemented or otherwise modified,
renewed or replaced from time to time in accordance with its terms being the
"Credit Agreement"), pursuant to which (i) the Lenders have made available to
the Borrower a $185,000,000 five-year secured credit facility consisting of a
term loan of $135,000,000 and a revolving credit facility of $50,000,000 and
(ii) the Corporate Guarantors have guaranteed the Obligations (such term being
used herein as defined in the Credit Agreement) of the Borrower;
WHEREAS, pursuant to the Credit Agreement, the Contributors
have granted to the Agent for the benefit of the Lenders a security interest in
the Collateral as security for their respective obligations under the Credit
Agreement;
306
WHEREAS, pursuant to the Guaranty dated as of the date hereof,
issued by each of the Parent Guarantors (the "Guaranty"), the Parent Guarantors
have provided to the Agent for the benefit of the Lenders, an unconditional
guaranty of payment of the Revolving Credit Loans;
WHEREAS, as a result of the transactions contemplated by the
Credit Agreement, the Contributors and the Parent Guarantors will benefit,
directly and indirectly, from the Obligations and in consideration thereof
desire to enter into this Agreement to allocate such benefits among themselves
and to provide a fair and equitable arrangement to make contributions in the
event (i) any payment is made by a Contributor or Parent Guarantor under the
Credit Agreement or the Guaranty or to otherwise satisfy any Obligations, or
(ii) the Agent (on behalf of the Lenders) exercises any right of set-off
against any Contributor or Parent Guarantor or recourse against any of the
Collateral owned by a Contributor (such payment or recourse being referred to
herein as a "Contribution");
NOW, THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, the Contributors and the Parent Guarantors hereby agree as
follows:
SECTION 1. Contribution. In the event any Parent Guarantor or
Contributor makes any Contribution, such Parent Guarantor or Contributor shall
be entitled to a contribution from certain other Contributors for all payments,
damages and expenses incurred by such Parent Guarantor or Contributor in
discharging any of the Obligations, in the manner and to the extent set forth
in this Agreement. The amount of any Contribution under this Agreement shall
be equal to the payment made by such Parent Guarantor or Contributor pursuant
to the Credit Agreement or Guaranty or the fair saleable value of the
Contributor's portion of the Collateral against which recourse is exercised,
and shall be determined as of the date on which such payment is made or
recourse is exercised, as the case may be.
SECTION 2. Parent Payment. In the event that either Parent
Guarantor makes a Contribution (a "Parent Payment"):
(a) each of the Contributors hereby acknowledges
that each Parent Guarantor shall be fully subrogated to
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307
the extent of such Parent Payment to all of the rights and
remedies (including without limitation all of the security
interests) of the Agent and the Lenders under all of the
Fundamental Documents against each of the Contributors; and
(b) each of the Contributors agrees that it is
jointly and severally liable to reimburse each Parent
Guarantor in full, (together with interest calculated in
accordance with the Credit Agreement) for any Parent Payment
without regard to any rights (including, without limitation,
those rights provided in this Agreement) that such Contributor
may have against any other Contributor of the Obligations
which might otherwise limit such Contributor's joint and
several liability to reimburse each Parent Guarantor in full.
SECTION 3. Priority of Parent Guarantor. Each of the
Contributors hereby agrees that all of the rights of each Parent Guarantor
referred to in this Agreement shall have priority over any right of any
Contributor, whether direct or indirect, by contribution, subrogation,
reimbursement, indemnification or otherwise, to demand any payment,
contribution or reimbursement whatsoever from any other Contributor until such
time as any and all Parent Payments have been repaid to each Parent Guarantor
in full and neither Parent Guarantor has any further obligations under the
Parent Guaranty, and until such time as the Contributors shall not be entitled
to exercise any such rights against any other Contributor. The forgoing shall
not prevent the making of any payment otherwise permitted under the Fundamental
Documents, including, without limitation, any Restricted Payment otherwise
permitted thereunder.
SECTION 4. No Duty to Contributor. Except for duties
expressly stated to be applicable to the Agent and the Lenders under the
Fundamental Documents and non-waivable, mandatory duties imposed by law, each
of the Contributors hereby acknowledges and agrees that (i) neither of the
Parent Guarantors has any duties to any Contributor with respect to the method,
manner and timing of the exercise or nonexercise of any of such Parent
Guarantor's rights to recover payment of any Parent Payment and (ii) to the
extent that any such duties may exist, they are hereby waived.
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SECTION 5. Parent Guarantor's Right of Set-off. In
the event that either Parent Guarantor makes any Parent Payment, each Parent
Guarantor is hereby irrevocably authorized by each Contributor at any time and
from time to time without notice to such Contributor, any such notice being
hereby waived by such Contributor, to set off and appropriate and apply any and
all deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by either Parent Guarantor to or for the
credit or the account of such Contributor, or any part thereof in such amounts
as either Parent Guarantor may elect, on account of the liabilities of such
Contributor hereunder or under the Fundamental Documents and claims of every
nature and description of either Parent Guarantor against such Contributor, in
any currency, whether arising hereunder or otherwise, as either Parent
Guarantor may elect, whether or not either Parent Guarantor has made any demand
for payment and although such liabilities and claims may be contingent or
unmatured. Each Parent Guarantor shall notify such Contributor promptly of any
such set-off made by it and the application made by it of the proceeds thereof;
provided that the failure to give such notice shall not affect the validity of
such set-off and application. The rights of each Parent Guarantor under this
Section 5 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which either Parent Guarantor may have
against any Contributor.
SECTION 6. Benefit Amount Defined. For purposes of this
Agreement, the "Benefit Amount" of any Contributor as of any date of
determination shall be the net value of the benefits to such Contributor from
extensions of credit made by the Lenders to the Borrower under the Credit
Agreement. Such benefits (collectively, the "Benefits") shall include, without
limitation, benefits of funds constituting proceeds of Loans which are advanced
to a Borrower by the Lenders and which are in turn advanced or contributed by
the Borrower to such Contributor. In the case of any proceeds of Loans or
Benefits advanced or contributed to, or received by, a Person (an "Owned
Entity") any of the equity interests of which are owned directly or indirectly
by a Contributor, the Benefit Amount of such Contributor with respect thereto
shall be that portion of the net value of the benefits attributable to such
proceeds of Loans or Benefits equal
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to the direct or indirect percentage ownership of such Contributor in its Owned
Entity.
SECTION 7. Contribution Obligation. In the event that any of
the Contributors (a "Corporate Contributor") is required to make a
Contribution:
(a) each such Corporate Contributor hereby waives
any and all rights, whether direct or indirect, or by
contribution, subrogation, reimbursement, indemnification or
otherwise, to demand any payment, contribution or
reimbursement whatsoever from either Parent Guarantor or its
successors or assigns under the Guaranty as a result of such
Contribution; and
(b) each other Contributor shall be liable to such
Corporate Contributor in an amount equal to the greater of (A)
the product of (i) a fraction the numerator of which is the
Benefit Amount of such Contributor, and the denominator of
which is the total amount of Obligations and (ii) the amount
of Obligations paid by such Corporate Contributor and (B) 95%
of the excess of the fair saleable value of the property of
such Contributor over the total liabilities of such
Contributor (including the maximum amount reasonably expected
to become due in respect of contingent liabilities), as the
case may be, determined as of the date on which the payment by
a Corporate Contributor is deemed made for purposes of this
Agreement or any recourse is exercised against a Corporate
Contributor's portion of the Collateral, as the case may be
(giving effect to all payments made by other Corporate
Contributors and to the exercise of recourse against any other
Corporate Contributor's portion of the Collateral as of such
date in a manner to maximize the amount of such
contributions).
SECTION 8. Allocation Among Multiple Corporate Contributors.
In the event that at any time there exists more than one Corporate Contributor
with respect to any Contribution (in any such case, the "Applicable
Contribution"), then payment from other Corporate Contributors pursuant to this
Agreement shall be allocated among such Corporate Contributors in proportion to
the total amount of the Contribution made for or on account of the Borrower by
each such Corporate Contributor
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pursuant to the Applicable Contribution. In the event that at any time any
Contributor pays an amount under this Agreement in excess of the amount
calculated pursuant to clause (b)(A) of Section 7 hereof, that Contributor
shall be deemed to be a Corporate Contributor to the extent of such excess and
shall be entitled to contribution from the other Contributors in accordance
with the provisions of this Agreement.
SECTION 9. Subrogation. Any payments made hereunder by the
Borrower shall be credited against amounts payable by the Borrower pursuant to
any subrogation rights of the Contributors which received the payments under
this Agreement.
SECTION 10. Preservation of Rights. This Agreement shall not
limit any right which any Contributor may have against any other Person which
is not a party hereto.
SECTION 11. Subsidiary Payment. The amount of contribution
payable under this Agreement by any Contributor shall be reduced by the amount
of any contribution paid hereunder by a guarantor of such Contributor.
SECTION 12. Equitable Allocation. If as a result of any
reorganization, recapitalization, or other corporate change in the Borrower or
any Affiliate or guarantor of the Borrower, or as a result of any amendment,
waiver or modification of the terms and conditions governing the Credit
Agreement or the Obligations, or for any other reason, the contributions under
this Agreement become inequitable as between the Corporate Guarantors, the
parties hereto shall promptly modify and amend this Agreement to provide for an
equitable allocation of the contributions as between the Corporate Guarantors.
Any of the foregoing modifications and amendments shall be in writing and
signed by all parties hereto.
SECTION 13. Asset of Party to Which Contribution is Owing.
The parties hereto acknowledge that the right to contribution hereunder shall
constitute an asset in favor of the party to which such contribution is owing.
SECTION 14. Subordination. No payments payable by a
Contributor pursuant to the terms hereof shall be paid until all Obligations
then due and payable by the Borrower to any Lender, are paid in full in cash
and the Commitments are terminated. Nothing contained in this Agreement shall
affect the Obligations
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or the obligations of any party hereto to any Lender under the Credit Agreement
or any other Fundamental Document.
SECTION 15. Non-Exclusivity. Notwithstanding anything in
this Agreement to the contrary, the rights accorded to each Parent Guarantor
hereunder shall be in addition to, and not in lieu of, any rights that either
Parent Guarantor may have to be reimbursed for all Parent Payments at common
law, in equity, by separate agreement or otherwise; provided, that none of such
rights may be exercised until the Obligations have been fully satisfied, and
all such rights are subject to the terms and provisions of the Fundamental
Documents.
SECTION 16. Continued Effectiveness. The rights of each of
the Parent Guarantor under this Agreement shall continue to be effective, or be
reinstated, as the case may be, if any payment made hereunder, or any part
thereof, on account of any of the Obligations is at any time rescinded or at
any time must otherwise be restored or returned by either of the Parent
Guarantors upon the insolvency, bankruptcy, dissolution, liquidation or
reorganization of any Contributor, or upon or as a result of the appointment or
a receiver, intervenor or conservator of, or trustee or similar officer for,
any Contributor or any substantial part of their property, or otherwise, all as
though such payments had not been made.
SECTION 17. Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
SECTION 18. Successors and Assigns; Amendments. This
Agreement shall be binding upon each party hereto and its respective successors
and assigns and shall inure to the benefit of the parties hereto and their
respective successors and assigns, and in the event of any transfer or
assignment of rights by a Contributor, the rights and privileges herein
conferred upon that Contributor shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and condition hereof.
Each reference herein to any party hereto shall be deemed to include its
successors and assigns, all of
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whom shall be bound and benefited by the provisions of this Agreement. Each
Contributor agrees to cause any other guarantor or other obligor on all or any
portion of the obligations guaranteed by the Parent Guarantor which is
controlled by any Contributor or which becomes such a guarantor or obligor with
the cooperation of any Contributor to enter into an agreement identical to this
one with such other guarantor or obligor being defined as a "Contributor".
Except as specifically required under Section 12 and as contemplated by the
Instrument of Assumption and Joinder, this Agreement shall not be amended
without the prior written consent of the Required Lenders.
SECTION 19. Termination. This Agreement shall remain in
effect and shall not be terminated until the Credit Agreement, all amounts owed
to the Parent Guarantors and this Agreement have been discharged or otherwise
satisfied in accordance with its respective terms.
SECTION 20. CHOICE OF LAW. THIS AGREEMENT AND ANY INSTRUMENT
OR AGREEMENT REQUIRED HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
SECTION 21. Counterparts. This Agreement, and any
modifications or amendments hereto, may be executed in any number of
counterparts, each of which when so executed and delivered shall constitute an
original for all purposes, but all such counterparts taken together shall
constitute one and the same instrument.
SECTION 22. Effectiveness. This Agreement shall become
effective as to any party upon the execution hereof by such party and delivery
of its executed counterpart to the Agent.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first written above.
ORION PICTURES CORPORATION
By________________________
Name:
Title:
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CORPORATE GUARANTORS:
BRIGHTON PRODUCTIONS, INC.
▇▇▇▇▇▇▇▇▇▇▇ MUSIC LIMITED
▇▇▇▇▇ MUSIC PUBLICATIONS
F.P. PRODUCTIONS
MUSICWAYS, INC.
OPC MUSIC PUBLISHING, INC.
ORION HOME ENTERTAINMENT
CORPORATION
ORION MUSIC PUBLISHING, INC.
ORION PICTURES DISTRIBUTION
(CANADA) INC.
ORION PICTURES DISTRIBUTION
CORPORATION
ORION PRODUCTIONS, INC.
ORION TV PRODUCTIONS, INC.
By_____________________________
Name:
Title:
Address: 1888 Century Park East
Los Angeles, CA 90067
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MCEG STERLING ENTERTAINMENT
MCEG STERLING PRODUCTIONS
MCEG STERLING DEVELOPMENT
MCEG STERLING COMPUTER SERVICES
MCEG STERLING ADMINISTRATIONS
By_____________________________
Name:
Title:
Address: 1888 Century Park East
Los Angeles, CA 90067
PARENT GUARANTORS:
METROMEDIA COMPANY, a general partnership
By:____________________________
Name:
Title:
_______________________________
▇▇▇▇ ▇. ▇▇▇▇▇
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EXHIBIT M
FORM OF GUARANTY AGREEMENT
GUARANTY AGREEMENT, dated as of
November 1, 1995 (as the same may be
amended from time to time, the
"Guaranty Agreement") among (i) ▇▇▇▇
▇. ▇▇▇▇▇, an individual residing at
c/o Metromedia Company, ▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
("▇▇▇▇▇"); (ii) METROMEDIA COMPANY,
a Delaware general partnership
("Metromedia"; together with ▇▇▇▇▇,
the "Guarantors" or individually, a
"Guarantor") and (iii) CHEMICAL
BANK, a New York banking
corporation, as agent for the
Lenders referred to below (in such
capacity, the "Agent").
Pursuant to the Credit, Security and Guaranty Agreement dated
as of November 1, 1995 (as the same may be amended, supplemented, or otherwise
modified, renewed or replaced from time to time, the "Credit Agreement") among
Orion Pictures Corporation, a Delaware corporation (the "Borrower"), the
Corporate Guarantors referred to therein, the Lenders referred to therein and
Chemical Bank, as Issuing Bank and Agent, the Lenders have agreed to make Term
Loans to the Borrower in an aggregate principal amount equal to $135,000,000
and to make Revolving Credit Loans to the Borrower in an aggregate principal
amount outstanding at any one time not in excess of $50,000,000. Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in the Credit Agreement.
As an inducement to the Lenders to make the Revolving Credit
Loans and issue Letters of Credit to the Borrower, the Guarantors have agreed
to guaranty such obligations of the Borrower to the extent and in accordance
with the terms hereof.
316
Therefore, for good and valuable consideration, the receipt of
which is hereby acknowledged by the Guarantors, the parties hereto agree as
follows:
1. GUARANTY
SECTION 1.1. Guaranty. (a) The Guarantors, jointly and
severally, unconditionally and irrevocably guarantee the due and punctual
payment by the Borrower, subject to Section 4.1, of all principal of and
interest on the Revolving Credit Loans made and to be made by the Lenders to
the Borrower, as and when such amounts shall become due and payable whether by
scheduled maturity, acceleration or otherwise and any extensions or renewals
thereof, reimbursement obligations in respect of Letters of Credit, related
costs and attorney's fees, and all other monetary obligations of the Borrower
to the Lenders, the Agent or the Issuing Bank under the Credit Agreement which
directly relate or are properly allocable to the Revolving Credit Loans or the
Letters of Credit (the "Guaranteed Obligations"). To the extent any amount is
not clearly allocable to the Revolving Credit Loans or the Letters of Credit,
the Agent shall allocate such amounts pro-rata based upon the then outstanding
Term Loans and Revolving Credit Loans and L/C Exposure. The Guaranteed
Obligations shall not include the Term Loans or interest and fees payable on
the Term Loan.
(b) In furtherance of the provisions of this Guaranty
Agreement, and not in limitation of any other right which the Lenders may have
at law or in equity against the Borrower or any other guarantor of the
Guaranteed Obligations, upon failure of the Borrower to pay any of the
Guaranteed Obligations when and as the same shall become due, whether at
maturity, by acceleration, after notice or otherwise, each Guarantor hereby
promises to and will, upon receipt of written demand by the Agent on behalf of
▇▇▇▇▇▇▇, forthwith pay or cause to be paid to the Agent on behalf of ▇▇▇▇▇▇▇ in
cash an amount equal to the unpaid balance of the Guaranteed Obligations,
subject always to the limitation set forth in Section 4.1 hereof.
(c) Each Guarantor, to the extent permitted by applicable
law, waives presentation to, demand for payment from and protest to the
Borrower and also waives notice of protest for nonpayment, notice of
acceleration and notice of intent to
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accelerate. The obligations of each Guarantor hereunder shall not be affected
by (i) the failure of the Agent or any Lender to assert any claim or demand or
to enforce any right or remedy against the Borrower or any other guarantor of
the Guaranteed Obligations under the provisions of the Credit Agreement or any
other agreement or otherwise; (ii) any extension or renewal of any provision
hereof or thereof; (iii) any rescission, waiver, compromise, acceleration,
amendment or modification of any of the terms or provisions of the Credit
Agreement, the Revolving Credit Notes or any other agreement; (iv) the release,
exchange, waiver or foreclosure of any security held by the Agent for the
Guaranteed Obligations or any of them or (v) the failure of the Agent or any
Lender to exercise any right or remedy against any other guarantor of the
Guaranteed Obligations. Notwithstanding the foregoing, the consent of
Metromedia shall be required prior to any written amendment, waiver or
modification to the Credit Agreement.
(d) Each Guarantor further agrees that this guaranty is
acontinuing guaranty and constitutes a guaranty of performance and of payment
when due and not just of collection, and waives, to the extent permitted by
applicable law, any right to require that any resort be had by the Agent or the
Lenders to any security held for payment of the Guaranteed Obligations or to
any balance of any deposit, account or credit on the books of the Agent or any
Lender in favor of the Borrower or any other guarantor or to any other person.
(e) Each Guarantor hereby expressly assumes all
responsibilities to remain informed of the financial condition of the Borrower
and each other guarantor of the Guaranteed Obligations and any circumstances
affecting the Collateral or the ability of the Borrower to perform under the
Credit Agreement.
(f) This guaranty shall not be affected by the genuineness,
validity, regularity or enforceability of the Guaranteed Obligations, the
Revolving Credit Notes or any other instrument evidencing any of the Guaranteed
Obligations, or by the existence, validity, enforceability, perfection or
extent of any collateral therefor or by any other circumstance relating to the
Guaranteed Obligations which might otherwise constitute a defense to the
guaranty under this Guaranty Agreement. The Agent makes no representation or
warranty in respect to any such
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circumstances nor has any duty or responsibility whatsoever to the Guarantors
in respect to the management and maintenance of the Guaranteed Obligations or
the Collateral.
SECTION 1.2. No Impairment of Guaranty. The obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including, without limitation, any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense (other than payment of the Guaranteed Obligations) or
set-off, counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality or unenforceability of the Guaranteed Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations
of each Guarantor hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Agent or any Lender to assert any claim or
demand or to enforce any remedy hereunder or under the Credit Agreement or any
other agreement, by any waiver or modification of any provision thereof, by any
default, failure, or delay, willful or otherwise, in the performance of the
Guaranteed Obligations, or by any other act or thing, or omission or delay to
do any other act or thing, which may or might in any manner or to any extent
vary the risk of the Guarantor or would otherwise operate as a discharge of the
Guarantor as a matter of law, unless and until the Guaranteed Obligations are
paid in full.
SECTION 1.3. Continuation and Reinstatement, etc. Each
Guarantor further agrees that its or his, as the case may be, guaranty
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of principal of or interest on any
Obligation is rescinded or must otherwise be restored by the Agent upon the
bankruptcy or other reorganization of the Borrower or any other guarantor of
the Guaranteed Obligations or otherwise.
SECTION 1.4. Subrogation. Subject to the prior final and
indefeasible payment in full of all Obligations and to the extent of payments
received by the Agent from a Guarantor on the Guaranteed Obligations, such
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Guarantor shall be subrogated to the rights of the Agent and the Lenders to
receive payments or distributions of cash, property or securities of the
Borrower applicable to the Obligations; provided, however, that all such rights
of subrogation shall be subordinated and junior in right of payment to the
prior payment in full of the Obligations to the Agent and the Lenders in the
manner and to the extent set forth in the Subordination Agreement, dated the
date hereof, attached hereto as Exhibit 1 and the Priority and Contribution
Agreement.
2. REPRESENTATIONS AND WARRANTIES
Each Guarantor makes the following representations and
warranties to the Lenders, all of which shall survive the execution and
delivery of the Revolving Credit Notes and this Guaranty Agreement and the
making of the loans evidenced and to be evidenced by the Revolving Credit
Notes:
(i) Metromedia is a Delaware general partnership
whose general partners are ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇.
(ii) Metromedia has been duly organized and is
validly existing in good standing under the laws of its
jurisdiction of organization.
(iii) The execution, delivery and performance of
this Guaranty Agreement by the Guarantors (a) in the case of
Metromedia, has been duly authorized by all necessary
partnership action, (b) will not violate, or involve any of
the Lenders in a violation of, any provision of applicable law
or any order of any governmental authority or any judgment of
any court applicable to the Guarantor his or its property, as
the case may be, (c) will not violate any indenture, any
agreement for borrowed money, any bond, note or other similar
instrument or any other material agreement to which any
Guarantor is a party or by which any Guarantor or any of its
or his, as the case may be, property is bound, (d) will not be
in conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under, any such
indenture, agreement, bond, note, instrument or other material
agreement and (e) will not result in the creation or
imposition of any lien, charge or encumbrance of any nature
whatsoever upon any property or assets of any Guarantor other
than pursuant to this Guaranty.
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(iv) This Guaranty Agreement constitutes the legal,
valid and binding obligation of the Guarantors, enforceable in
accordance with its terms, subject (a) as to the enforcement
of remedies, to applicable bankruptcy, reorganization,
insolvency and other laws affecting creditors' rights
generally and to moratorium laws from time to time in effect,
(b) to general equitable principles which may limit the right
to obtain the remedy of specific performance and (c) the
qualification that the enforceability of indemnification
provisions may be limited by applicable federal and state
securities laws, rules and regulations.
(v) The Guarantors will realize a direct economic
benefit as a result of the Loans being made to the Borrower
pursuant to the Credit Agreement.
(vi) The net worth certificate as at November 1,
1995, in the form which the Guarantors have previously
provided to the Lenders, fairly presents the minimum net worth
of the Guarantors as at such date.
3. COVENANT
SECTION 3.1. Net Worth Certificate. The Guarantors hereby
agree to deliver to the Agent, within 90 days after the end of each fiscal year
of the Borrower, a net worth certificate in the form previously delivered to
the Lenders, certifying that Metromedia or ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ have a
net worth of at least $1,000,000,000.
4. REDUCTION OF GUARANTEED OBLIGATIONS
SECTION 4.1. Reduction of Guaranteed Obligations. In the
event that the Term Loans shall be completely repaid at or before December 31,
2000, then the maximum liability of the Guarantors pursuant to Section 1.1
hereof shall be limited to the amount, if any, by which the Guaranteed
Obligations outstanding at December 31, 2000 (together related interest, fees
and expenses) exceeds 66.67% of the amount of the Receivables Borrowing Base
determined as of such date.
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5. MISCELLANEOUS
SECTION 5.1. Notices. Notices and other communications
provided for herein shall be in writing and shall be delivered or mailed (or if
by telecopier, delivered by such equipment) addressed, if to the Agent, to it
at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, III,
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to CBC-USA, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇ or if to Metromedia, to it at One Meadowlands
Plaza, East Rutherford, New Jersey 07073, Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Telecopy No.:
(▇▇▇) ▇▇▇-▇▇▇▇, or if to ▇▇▇▇▇, to him at c/o Metromedia Company, ▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ or such other address as such party may from time to
time designate by giving written notice to the other party hereunder. All
notices and other communications given to any party hereto in accordance with
the provisions of this Guaranty Agreement shall be deemed to have been given on
the fifth Business Day after the date when sent by registered or certified
mail, postage prepaid return receipt requested, if by mail, or when receipt is
acknowledged, if by telecopier, in each case addressed to such party as
provided in this Section 5.1 or in accordance with the latest unrevoked written
direction from such party.
SECTION 5.2. Successors. Each reference herein to a party
hereto shall be deemed to include their respective successors, assigns, heirs,
executors, administrators and legal representatives including but not by way of
limitation, any party in whose favor the provisions of the Revolving Credit
Notes shall inure, all of whom shall be bound by the provisions of this
Guaranty Agreement.
SECTION 5.3. SERVICE OF PROCESS. EACH GUARANTOR (I) HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE COURTS OF THE STATE OF NEW
YORK IN NEW YORK COUNTY AND TO THE JURISDICTION OF THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, FOR THE PURPOSE OF ANY SUIT,
ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON THIS GUARANTY
AGREEMENT, OR THE SUBJECT MATTER HEREOF BROUGHT BY THE AGENT OR ITS SUCCESSORS
OR ASSIGNS AND (II) HEREBY WAIVES, AND AGREES NOT TO ASSERT, BY WAY OF MOTION,
AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR PROCEEDING, ANY CLAIM
THAT HE OR IT, AS THE
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CASE MAY BE, IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF THE ABOVE-NAMED
COURTS, THAT HIS OR ITS, AS THE CASE MAY BE, PROPERTY IS EXEMPT OR IMMUNE FROM
ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER, OR THAT THIS GUARANTY AGREEMENT OR THE SUBJECT MATTER HEREOF OR
THEREOF MAY NOT BE ENFORCED IN OR BY SUCH COURT, AND (III) HEREBY AGREES NOT TO
ASSERT ANY OFFSETS OR COUNTERCLAIMS (OTHER THAN COMPULSORY COUNTERCLAIMS) IN
ANY SUCH ACTION, SUIT OR PROCEEDING. EACH GUARANTOR HEREBY CONSENTS TO SERVICE
OF PROCESS BY CERTIFIED MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN,
AND AGREES THAT THE SUBMISSION TO JURISDICTION AND THE CONSENT TO SERVICE OF
PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF THE AGENT AND THE LENDERS.
FINAL JUDGMENT AGAINST ANY GUARANTOR IN ANY SUCH ACTION, SUIT OR PROCEEDING
SHALL BE CONCLUSIVE, AND MAY BE ENFORCED IN OTHER JURISDICTIONS (X) BY SUIT,
ACTION OR PROCEEDING ON THE JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL
BE CONCLUSIVE EVIDENCE OF THE FACT AND OF THE AMOUNT OF ANY INDEBTEDNESS OR
LIABILITY OF SUCH GUARANTOR THEREIN DESCRIBED OR (Y) IN ANY OTHER MANNER
PROVIDED BY, OR PURSUANT TO, THE LAWS OF SUCH OTHER JURISDICTION; PROVIDED,
HOWEVER, THAT THE AGENT MAY AT ITS OPTION BRING SUIT OR INSTITUTE OTHER
JUDICIAL PROCEEDINGS AGAINST A GUARANTOR OR ANY OF HIS OR ITS, AS THE CASE MAY
BE, ASSETS IN ANY STATE OR FEDERAL COURT OF THE UNITED STATES OR OF ANY COUNTRY
OR PLACE WHERE SUCH GUARANTOR OR SUCH ASSETS MAY BE FOUND.
SECTION 5.4. GOVERNING LAW. THIS GUARANTY AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 5.5. No Waiver, etc. Neither a failure nor a delay
on the part of the Agent in exercising any right, power or privilege under this
Guaranty Agreement shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege. The rights, remedies and benefits of the Agent herein
expressly specified are cumulative and not exclusive of any other rights,
remedies or benefits which it may have under this Guaranty Agreement, at law,
in equity, by statute, or otherwise.
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SECTION 5.6. Modification, etc. No modification, amendment
or waiver of any provision of this Guaranty Agreement, nor the consent to any
departure by a Guarantor therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Agent and the Lenders, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given. No notice to or demand on a Guarantor in any case
shall entitle such Guarantor to any other or further notice or demand in the
same, similar or other circumstances.
SECTION 5.7. Severability. If any one or more of the
provisions contained in this Guaranty Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall in no way be affected or impaired
thereby.
SECTION 5.8. Headings. Section headings used herein are for
convenience of reference only and are not to affect the construction of, or be
taken into consideration in interpreting, this Guaranty Agreement.
SECTION 5.9. WAIVER OF JURY TRIAL. TO THE EXTENT NOT
PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH GUARANTOR HEREBY
WAIVES, AND COVENANTS THAT HE OR IT, AS THE CASE MAY BE, WILL NOT ASSERT
(WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN
ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION
ARISING OUT OF OR BASED UPON THIS GUARANTY AGREEMENT OR THE SUBJECT MATTER
HEREOF, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING OR WHETHER IN
CONTRACT OR TORT OR OTHERWISE. EACH GUARANTOR ACKNOWLEDGES THAT HE OR IT, AS
THE CASE MAY BE, HAS BEEN INFORMED BY THE AGENT THAT THE PROVISIONS OF THIS
SECTION 5.9 CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH THE LENDERS HAVE
RELIED, ARE RELYING AND WILL RELY IN MAKING THE LOANS EVIDENCED BY THE
REVOLVING CREDIT NOTES AND ENTERING INTO THIS GUARANTY AGREEMENT. THE AGENT
MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 5.9 WITH ANY COURT
AS WRITTEN EVIDENCE OF THE CONSENT OF EACH GUARANTOR TO THE WAIVER OF HIS OR
ITS, AS THE CASE MAY BE, RIGHTS TO TRIAL BY JURY.
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IN WITNESS WHEREOF, each of the Guarantor and the Agent has
caused this Guaranty Agreement to be executed by its duly authorized officer,
all as of the date first written above.
METROMEDIA COMPANY, a general
partnership
By:___________________________
Name:
Title:
______________________________
▇▇▇▇ ▇. ▇▇▇▇▇
Executed by the Agent CHEMICAL BANK
in New York, New York
By:____________________________
Name:
Title:
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EXHIBIT N
FORM OF INSTRUMENT OF ASSUMPTION AND JOINDER
Instrument of ASSUMPTION AND JOINDER AGREEMENT dated as of
_________, ____ (the "Assumption Agreement") made by [INSERT NAME OF CREDIT
PARTY] a [INSERT STATE OF INCORPORATION] corporation ("[INSERT ABBREVIATED NAME
["NAME"] OF CREDIT PARTY]") in favor of the lenders (the "Lenders") referred to
in that certain Credit, Security and Guaranty Agreement dated as of November 1,
1995 (as the same may be amended, supplemented or otherwise modified, renewed
or replaced from time to time, the "Credit Agreement"; capitalized terms used
herein and not otherwise defined shall have the meanings set forth in the
Credit Agreement) among Orion Pictures Corporation, a Delaware corporation (the
"Borrower"), the Corporate Guarantors referred to therein, the Lenders and
Chemical Bank, as Agent and as Issuing Bank.
W I T N E S S E T H
[NAME] [EITHER (I) IS A RECENTLY FORMED [INSERT STATE OF
INCORPORATION] CORPORATION OR (II) A FORMERLY INACTIVE SUBSIDIARY] and is a
Subsidiary of the Borrower. Pursuant to Section 5.20 of the Credit Agreement,
[NAME] is required to execute this document (as a [EITHER (I) NEWLY FORMED
SUBSIDIARY OF THE BORROWER OR (II) A FORMERLY INACTIVE SUBSIDIARY OF THE
BORROWER]).
NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, the receipt of which is ▇▇▇▇▇▇ acknowledged,
[NAME] ▇▇▇▇▇▇ agrees as follows:
1. Assumption and Joinder.
(a) [NAME] hereby expressly confirms that it has
assumed, and ▇▇▇▇▇▇ agrees to perform and observe, each and every one of the
covenants, rights, promises, agreements, terms,
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conditions, obligations, appointments, duties and liabilities of (i) a
Corporate Guarantor under the Credit Agreement, the Notes and all the other
Fundamental Documents and (ii) a Contributor (as such term is defined in the
Contribution Agreement) under the Contribution Agreement. By virtue of the
foregoing, [NAME] hereby accepts and assumes any liability of (x) a Corporate
Guarantor and/or a Credit Party related to each representation or warranty,
covenant or obligation made by a Corporate Guarantor and/or a Credit Party in
the Credit Agreement or any other document and hereby expressly affirms, on the
date hereof, for the benefit of the Lenders, each of such representations,
warranties, covenants and obligations and (y) a Contributor related to each
covenant or obligation made by a Contributor in the Contribution Agreement and
hereby expressly affirms, on the date hereof, each of such covenants and
obligations.
(b) All references to the term "Corporate
Guarantor" or "Credit Party" in the Credit Agreement or any other Fundamental
Document, or in any document or instrument executed and delivered or furnished,
or to be executed and delivered or furnished, in connection therewith shall be
deemed to be references to, and shall include, [NAME].
(c) All references to the term "Contributor" in
the Contribution Agreement, or in any document or instrument executed and
delivered or furnished, or to be executed and delivered or furnished, in
connection therewith shall be deemed to be references to, and shall include,
[NAME].
2. Representations and Warranties. [NAME] ▇▇▇▇▇▇
represents and warrants to the Lenders as follows:
(a) [NAME] has the requisite corporate power and
authority to enter into this Assumption Agreement and to perform its
obligations hereunder and under the Credit Agreement, the Contribution
Agreement and the other Fundamental Documents. The execution, delivery and
performance of this Assumption Agreement by [NAME] and the performance of its
obligations under the Credit Agreement and the other Fundamental Documents have
been duly
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authorized by the Board of Directors of [NAME] and no other corporate
proceedings on the part of [NAME] are necessary to authorize the execution,
delivery or performance of this Assumption Agreement, the transactions
contemplated hereby or the performance of its obligations under the Credit
Agreement or any other Fundamental Document. This Assumption Agreement has
been duly executed and delivered by [NAME]. This Assumption Agreement and the
Credit Agreement each constitutes a legal, valid and binding obligation of
[NAME], enforceable against it in accordance with its terms, subject as to the
enforcement of remedies, to applicable bankruptcy, insolvency and similar laws
affecting creditors rights generally and to general principles of equity.
(b) The representations and warranties set forth
in Article 3 of the Credit Agreement are true and correct on and as of the date
hereof (except to the extent that such representations and warranties expressly
relate to an earlier date) with the same effect as if made on and as of the
date hereof.
(c) The authorized capitalization of [NAME], the
number of shares of its capital stock outstanding on the date hereof, and the
ownership of each outstanding capital stock is set forth on Schedule 1 hereto.
(d) On the date hereof [NAME] has not done
business, is not doing business and does not intend to do business other than
under its full corporate name, including, without limitation, under any trade
name or other doing business name and is in good standing in all jurisdictions
where the nature of its properties or business so requires.
(e) The chief executive office of [NAME] is
located at [INSERT ADDRESS] Such office is the place where [NAME] is "located"
for the purpose of the UCC and the Uniform Commercial Code in effect in the
state in which [NAME] is so located, and the place where [NAME] keeps the
records concerning the Collateral on the date hereof. The only places at which
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[NAME] regularly keeps any goods included in the Collateral on the date hereof
are the places listed on Schedule 2 hereto.
3. Further Assurances. At any time and from time to
time, upon the Agent's request and at the sole expense of [NAME], [NAME] will
promptly and duly execute and deliver any and all further instruments and
documents and take such further action as the Agent reasonably deems necessary
to effect the purposes of this Assumption Agreement.
4. Binding Effect; Assignment. This Assumption
Agreement shall be binding upon [NAME] and shall inure to the benefit of the
Lenders and their respective successors and assigns.
5. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered by its duly authorized officer as
of the date first above written.
[NAME]
By: _______________________________
Name:
Title:
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SCHEDULE 1
Capital Stock of [NAME]
Authorized capitalization:
Number of shares of capital stock
outstanding:
Ownership of the outstanding
capital stock:
331
SCHEDULE 2
Location of Collateral
332
EXHIBIT O
FORM OF NOTICE OF ASSIGNMENT
AND IRREVOCABLE INSTRUCTIONS
ORION PICTURES CORPORATION
1888 Century Park East
Los Angeles, CA 90067
As of _____________
[INSERT NAME AND ADDRESS OF ACCOUNT DEBTOR]
Re: [DESCRIBE AGREEMENT WITH ACCOUNT DEBTOR
(THE "AGREEMENT")]
Dear Sir or Madam:
The undersigned has created a security interest in its
benefits and rights to receive payments under the Agreement referred to above,
for the benefit of the Lenders party to that certain Credit, Security and
Guaranty Agreement dated as of November 1, 1995 (as the same may be amended,
supplemented or otherwise modified, renewed or replaced from time to time, the
"Credit Agreement") among Orion Pictures Corporation (the "Company"), the
Corporate Guarantors named therein, the Lenders named therein and Chemical
Bank, as Agent and Issuing Bank.
The Company hereby irrevocably instructs and authorizes you to
pay all monies from time to time owing or to become due from you to us pursuant
to the Agreement as follows:
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If by wire transfer, to:
Chemical Bank
Collection Account
for credit to Orion Pictures Corporation
Concentration Account
Account No. 144021927
ABA # ▇▇▇▇▇▇▇▇▇
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334
If by mail or hand delivery, to:
Orion Pictures
Post Office Box 305050
Newark, New Jersey 07193-5050
This authority and instruction is coupled with an interest and
may not be modified, terminated or revoked without the prior written consent of
the Agent.
Upon the occurrence of an Event of Default (as such term is
defined in the Credit Agreement), the Agent shall have the right to modify this
authority and instruction by written notice to the parties hereto.
Please signify your acknowledgment hereof by signing and
returning to the Agent at the address below the acknowledgment and confirmation
as set out below.
Very truly yours,
ORION PICTURES CORPORATION
By:___________________________
Name:
Title:
To: Chemical Bank, as Agent
c/o ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-0060
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
WE ACKNOWLEDGE RECEIPT, of the foregoing notice of irrevocable authority and
instruction and undertake to comply with it. We hereby confirm and agree that
all monies owing under the Agreement shall be paid immediately when they are
due subject only to the Agreement between us and the Company.
3
335
Dated this ______ day of ______
[NAME OF ACCOUNT DEBTOR]
By:_________________________
Name:
Title:
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EXHIBIT 1
TO GUARANTY AGREEMENT
FORM OF SUBORDINATION AGREEMENT
SUBORDINATION AGREEMENT dated as of
November 1, 1995 (as amended, supplemented,
otherwise modified, renewed or replaced from
time to time, the "Agreement") among (i)
ORION PICTURES CORPORATION (the "Obligor"),
(ii) METROMEDIA COMPANY, a Delaware general
partnership ("Metromedia"), (iii) ▇▇▇▇ ▇.
▇▇▇▇▇, an individual residing at c/o
Metromedia Company, ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇ ("▇▇▇▇▇"; together with
Metromedia, the "Subordinated Creditors") and
(iii) CHEMICAL BANK, as agent for the Lenders
referred to in the Credit Agreement (the
"Agent").
Introductory Statement
Pursuant to the terms of a Credit, Security and Guaranty
Agreement dated as of November 1, 1995 among the Obligor, the lenders referred
to therein (the "Lenders"), and the Agent (the "Credit Agreement") the Lenders
have agreed, subject to the terms and conditions thereof, to make loans (the
"Loans") to the Obligor. The Credit Agreement, the Notes referred to therein,
any Interest Rate Protection Agreement or Currency Agreement entered into with
any Lender and the other documents, instruments and agreements contemplated
thereby as they may be amended or otherwise modified from time to time, shall
hereinafter be referred to as "Senior Obligation Documents". For purposes of
this Agreement, unless otherwise defined herein, capitalized terms used herein
shall have the meanings given to such terms in the Credit Agreement.
The Subordinated Creditors have entered into a Guaranty
Agreement dated the date hereof between the Subordinated
337
Creditors and the Agent pursuant to which the Subordinated Creditors have
guaranteed certain obligations of the Obligor to the Lenders. Any obligation
of the Obligor to repay or reimburse the Subordinated Creditors for amounts
paid by the Subordinated Creditors in connection with the Guaranty Agreement
whether arising by subrogation or otherwise are hereinafter referred to as the
"Subordinated Obligations". Any document or instrument evidencing any
obligation, any replacements or substitutes therefore and any other related
agreement are hereinafter referred to as "Junior Obligation Documents".
In order to induce the Agent and the Lenders to enter into the
Credit Agreement, the Subordinated Creditors have agreed, subject to the
provisions of this Subordination Agreement, that the Subordinated Obligations
shall be subordinate to the Senior Obligations (as hereinafter defined).
NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. Agreement to Subordinate. The Subordinated Creditors
agree that the Subordinated Obligations are and shall be subordinate and
subject in right of payment, to the extent and in the manner hereinafter set
forth, to the prior payment in full of the Senior Obligations and that any
guarantees, security interests, mortgages and other liens securing payment of
the Subordinated Obligations are and shall be subordinate, to the fullest
extent permitted by law and as hereinafter set forth, to any guarantees,
security interests and mortgages and other liens securing payment of the Senior
Obligations, notwithstanding the perfection, order of perfection or failure to
perfect, any such security interest or other lien, or the filing or recording,
order of filing or recording, or failure to file or record this Subordination
Agreement or any instrument or other document in any filing or recording office
in any jurisdiction. The term "Senior Obligations" shall mean all obligations
of the Obligors under the Senior Obligation Documents including, without
limitation, whether outstanding at the date hereof or hereafter incurred or
created, all obligations to pay principal, premium, if any, interest
(including, without limitation, interest accruing after the commencement of any
bankruptcy, insolvency, reorganization or similar proceedings with respect to
the
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Obligor, whether or not determined to be an allowed claim in any such
proceeding), charges, costs, expenses and fees including, without limitation,
the disbursements and reasonable fees of counsel to the Agent or the Lenders,
all obligations to reimburse or indemnify the Agent and/or any Lender in any
way, and all renewals, extensions, restructurings, refinancings or refunding of
any indebtedness under the Senior Obligation Documents in the nature of a
"workout" or otherwise.
The expressions "prior payment in full", "payment in full",
"paid in full" or any other similar term(s) or phrase(s) when used herein with
respect to Senior Obligation Documents shall mean the payment in full, in cash,
of all of the Senior Obligations and the termination of the Commitments.
2. Restrictions on Payment of the Subordinated
Obligations, etc. The Subordinated Creditors will not ask, demand, sue for,
take or receive, directly or indirectly, from the Obligor or any affiliate
thereof, in cash or other property, by set-off, by realizing upon collateral,
by foreclosing on any lien or otherwise, by exercise of any remedies or rights
under the Junior Obligation Documents or by executions, garnishments, levies,
attachments or by any other action relating to the Subordinated Obligations, or
in any other manner, payment of, or additional security for, all or any part of
the Subordinated Obligations unless and until the Senior Obligations shall have
been paid in full. The Obligor will not make any payment on any of the
Subordinated Obligations, or take any other action, in contravention of the
provisions of this Subordination Agreement. The Subordinated Creditors
expressly agree that, unless and until such time as the Loans shall be
accelerated, any payment in respect of the Subordinated Obligations which is
not made in a timely manner by reason of the provisions of this Subordination
Agreement shall be deemed to be deferred until such time as payment can be made
in compliance with this Subordination Agreement and the Obligors shall not be
in default under any of the Junior Obligation Documents by reason thereof.
Each Subordinated Creditor further acknowledges and agrees
that it will not take any collateral of the Obligor unless and until the Senior
Obligations have been paid in full.
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3. Additional Provisions Concerning Subordination. The
Subordinated Creditors and the Obligor agree as follows:
a. In the event of (i) any dissolution, winding up,
liquidation or reorganization of the Obligor (whether voluntary or involuntary
and whether in bankruptcy, insolvency or receivership proceedings, or upon an
assignment for the benefit of creditors or proceedings for voluntary or
involuntary liquidation, dissolution or other winding up of the Obligor,
whether or not involving insolvency or bankruptcy, or any other marshalling of
the assets and liabilities of the Obligor or otherwise); or (ii) any Event of
Default (as such term is defined in the Credit Agreement) which has not been
waived or cured or an event which with notice and/or passage of time would
constitute an Event of Default (as such term is defined in the Credit
Agreement) which has not been waived or cured, or acceleration of maturity
regarding the Subordinated Obligations:
(1) all Senior Obligations shall first be paid to
the Agent for the benefit of the Lenders in full before any
payment or distribution is made upon the principal of or
interest on or any fees, costs, charges or expenses in
connection with the Subordinated Obligations, and before any
other action described in Sections 2 and 4 hereof is taken by
the Subordinated Creditors; and
(2) any payment or distribution of assets of the
Obligor, whether in cash, property or securities to which the
Subordinated Creditors would be entitled except for the
provisions hereof, shall be paid or delivered by the Obligor,
or any receiver, trustee in bankruptcy, liquidating trustee,
disbursing agent, agent or other person making such payment or
distribution, directly to the Agent for the benefit of the
Lenders, to the extent necessary to pay in full all Senior
Obligations remaining unpaid, after giving effect to any
concurrent payment or distribution to the Agent for the
benefit of the Lenders before any payment or distribution is
made to the Subordinated Creditors;
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b. In any proceeding referred to or resulting from any event
referred to in subsection (a) of this Section 3 commenced by or against the
Obligor:
(1) the Agent may, and is hereby irrevocably
authorized and empowered (in its own name or in the name of
the Subordinated Creditors or otherwise), but shall have no
obligation to, (i) demand, sue for, collect and receive every
payment or distribution referred to in subsection (a) of this
Section 3 and give acquittance therefor, (ii) file claims and
proofs of claim in the name of the Subordinated Creditors in
respect of the Subordinated Obligations, but only if the
Subordinated Creditors have not filed any claims or proofs of
claim with respect to the Subordinated Obligations before the
expiration of the time to file such, and (iii) take such other
action as the Agent may deem necessary or advisable for the
exercise or enforcement of any of the rights or interests of
the Agent and the Lenders hereunder; and
(2) the Subordinated Creditors will duly and
promptly take such action as the Agent may reasonably request
to collect the Subordinated Obligations for the account of the
Agent and to file appropriate claims or proofs of claim with
respect thereto, to execute and deliver to the Agent such
powers of attorney, assignments or other instruments as the
Agent may request in order to enable it to enforce any and all
claims with respect to the Subordinated Obligations, and to
collect and receive any and all payments or distributions
which may be payable or deliverable upon or with respect to
the Subordinated Obligations;
c. All payments or distributions upon or with respect to
the Subordinated Obligations which are received by the Subordinated Creditors
contrary to the provisions of this Subordination Agreement shall be deemed to
be the property of the Agent, shall be received in trust for the benefit of the
Agent, shall be segregated from other funds and property held by the
Subordinated Creditors and shall be forthwith paid over to the Agent for the
benefit of the Lenders in the same form as so received (with any necessary
endorsement) to be applied to the
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payment or prepayment of the Senior Obligations until the Senior Obligations
shall have been paid in full;
d. The Subordinated Creditors hereby waive any requirement
for marshalling of assets by the Agent in connection with any foreclosure of
any lien of the Agent under the Senior Obligation Documents;
e. The Subordinated Creditors shall not take any action to
impair or otherwise adversely affect the foreclosure of, or other realization
of the Agent's rights under the Senior Obligation Documents; and
f. The Agent is hereby authorized to demand specific
performance of this Subordination Agreement at any time when the Subordinated
Creditors shall have failed to comply with any of the provisions of this
Subordination Agreement, and the Subordinated Creditors hereby irrevocably
waive any defense based on the adequacy of a remedy at law which might be
asserted as a bar to such remedy of specific performance.
4. Subrogation. Subject to the payment in full of all
Senior Obligations to the extent of payments received by the Agent for
application against the Senior Obligations which would be payable to the
Subordinated Creditors for application against the Subordinated Obligations but
for the provisions of this Subordination Agreement, the Subordinated Creditors
shall be subrogated to the rights of the Agent and the Lenders to receive
payments or distributions of cash, property or securities of the Obligor
applicable to the Senior Obligations until the principal of (and premium, if
any) and interest on the Subordinated Obligations shall be paid in full; and,
for the purposes of such subrogation, no payments or distributions to the Agent
and the Lenders of any cash, property or securities to which the Subordinated
Creditors would be entitled except for the provisions of this Section, and no
payments over to the Agent and the Lenders pursuant to the provisions of this
Subordination Agreement by the Subordinated Creditor, shall, as between, the
Obligor, its creditors other than the Agent and the Lenders, and the
Subordinated Creditors, be deemed to be a payment by the Obligor to or on
account of the Senior Obligations. The Subordinated Creditors agree that no
payment or distribution to the Agent for the benefit of the Lenders pursuant to
the
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provisions of this Subordination Agreement shall entitle the Subordinated
Creditors to exercise any rights of subrogation in respect thereof until the
Senior Obligations shall have been paid in full.
5. Assignment and Pledge of Subordinated Obligations.
As security for the payment of all Senior Obligations and for performance by
the Subordinated Creditors of this Subordination Agreement, the Subordinated
Creditors do hereby transfer, assign and pledge to the Agent for the benefit of
the Lenders, and grant to the Agent for the benefit of the Lenders a security
interest in, all right, title and interest of the Subordinated Creditors in and
to the Subordinated Obligations together with any collateral security at any
time held or received therefor, with all of the rights therein and thereto of
the Subordinated Creditors including the right on the part of the Agent to
collect and enforce the Subordinated Obligations by suit, proof of debt or
claim in any proceeding under the Bankruptcy Code or any amendments thereto, or
in any dissolution, insolvency, liquidation or other proceeding involving an
adjustment of the indebtedness of the Obligor on the Subordinated Obligations
or application of the assets of the Obligor to the payment in liquidation
thereof, or otherwise. The Agent, in its own name or on behalf of the
Subordinated Creditors as holder of the Subordinated Obligations, may accept or
reject any plan of reorganization, readjustment, or compromise or otherwise.
The Subordinated Creditors and the Obligor further agree that
at no time hereafter will any part of the Subordinated Obligations be
represented by any negotiable instruments or other writings, unless such
negotiable instruments or other writings are delivered to the Agent, duly
endorsed, or assigned by the Subordinated Creditors, if payable to the
Subordinated Creditors. In the event of the failure of the Subordinated
Creditors to endorse said negotiable instruments or other writings, the Agent
is hereby irrevocably constituted and appointed attorney-in-fact for the
Subordinated Creditors with full power to make any such endorsements.
6. Legend. Each of the Subordinated Creditors and the
Obligor will cause each promissory note evidencing any of the Subordinated
Obligations, any replacement thereof and any
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mortgage or security document relating thereto to include or have endorsed
thereon the following provision:
"The indebtedness evidenced or secured by this
instrument is subordinated to other indebtedness pursuant to,
and to the extent provided in, and is otherwise subject to the
terms of, the Subordination Agreement dated as of November 1,
1995 by and among (1) Orion Pictures Corporation, as Obligor,
(ii) Metromedia Company, a Delaware general partnership, ▇▇▇▇
▇. ▇▇▇▇▇, as Subordinated Creditors and (iii) Chemical Bank,
as Agent for the Lenders."
7. Negative Covenants of the Subordinated Creditors. So long
as any of the Senior Obligations shall remain outstanding, the Subordinated
Creditors will not, without the prior written consent of the Agent:
a. Sell, assign, pledge, encumber or otherwise dispose of any
instrument evidencing the indebtedness owed to the Subordinated Creditors or
any collateral securing the Subordinated Obligations unless such sale,
assignment, pledge, encumbrance or other disposition is made expressly subject
to this Subordination Agreement and the other party to such sale, assignment,
pledge, encumbrance or other disposition consents in writing to be bound by the
terms hereof;
b. Permit the terms of the Junior Obligation Documents or
collateral securing any Subordinated Obligations to be changed in any way which
would limit or impair these subordination provisions, increase the interest
payable thereon, change any payment date thereunder or accept any collateral;
c. Declare all or any portion of the Subordinated Obligations
due and payable prior to the date fixed therefor or realize upon, or otherwise
exercise any remedies with respect to, any collateral securing the Subordinated
Obligations or take any other action described in Section 2 hereof; or
d. Commence, or join with any creditor other than the Lenders
in commencing any proceeding referred to in Section 3(a) hereof.
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8. Obligations Unconditional. All rights and interests of
the Agent and the Lenders hereunder, and all agreements and obligations of the
Subordinated Creditors and the Obligor hereunder, shall remain in full force
and effect irrespective of:
a. Any lack of validity or enforceability of any Senior
Obligation Document or any other agreement or instrument relating thereto;
b. Any change in the time, manner or place of payment of, or
in any other term of, all or any of the Senior Obligations, or any other
amendment or waiver of or any consent to departure from any Senior Obligation
Document;
c. Subject to the terms of the Guaranty Agreement, any
exchange, release or nonperfection of any collateral, or any release or
amendment or waiver of or consent to departure from any guaranty, for all or
any of the Senior Obligations;
d. Any other circumstances which might otherwise constitute a
defense available to, or a discharge of, the Obligor in respect of the Senior
Obligations or of the Subordinated Creditors or the Obligor in respect of this
Subordination Agreement; or
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e. Further subordinate the Subordinated Obligations.
9. Additional Agreements and Waivers by the
Subordinated Creditors. The Subordinated Creditors waive, to the fullest
extent permitted by law, any right to request marshalling of assets or
equitable subordination (whether under or pursuant to 11 U.S.C. Section 510 or
otherwise) and any right to assert that the Agent or any Lender has in any way
failed to comply with the provisions of the Uniform Commercial Code, including
the provisions of Article 9 thereof.
10. Representations and Warranties. Each Subordinated
Creditor hereby represents and warrants that:
a. such Subordinated Creditor has the power and authority and
the legal right to execute and deliver, and to perform its obligations
under, this Subordination Agreement, and has taken all necessary
action to authorize the execution, delivery and performance of this
Subordination Agreement;
b. this Subordination Agreement constitutes a legal, valid and
binding obligation of such Subordinated Creditor enforceable in
accordance with its terms, except as affected by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting the enforcement of
creditors' rights generally, general equitable principles and an
implied covenant of good faith and fair dealing;
c. the execution, delivery and performance of this
Subordination Agreement will not violate in any material respect any
provision of any Applicable Law or any agreement to which such
Subordinated Creditor is a party;
d. no consent or authorization of, filing with, or other act
by or in respect of, any arbitrator or Governmental Authority and no
consent of any other Person (including, without limitation, any
partner, stockholder or creditor of such Subordinated Creditor) is
required in connection with the execution, delivery, performance,
validity or enforceability of this Subordination Agreement;
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e. no litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority is pending or, to the
knowledge of such Subordinated Creditor, threatened by or against such
Subordinated Creditor with respect to this Subordination Agreement;
f. the agreements governing the Subordinated Obligations of
such Subordinated Creditor do not and will not contain (i) any default
which is triggered by (A) a default under any other agreements to
which the Obligor is a party or (B) any other Indebtedness of the
Obligor being declared due and payable prior to its stated maturity or
(ii) without limiting clause (i) above, any covenants or events of
default which are more strict than those contained in the Credit
Agreement; and
g. such Subordinated Creditor is an Affiliate of the Obligors
and the Subordinated Obligations are permitted by Section 6.1 of the
Credit Agreement.
11. Present Subordinated Obligations. Each of the
Subordinated Creditors hereby represents and warrants that the outstanding
Subordinated Obligations as of the this date are $______.
12. Further Assurances. The Subordinated Creditors and the
Obligor will, at their own expense and at any time and from time to time,
promptly execute and deliver all further instruments and documents, and take
all further action that the Agent may reasonably request, in order to perfect
or otherwise protect any right or interest granted or purported to be granted
hereby or to enable the Agent to exercise and enforce its rights and remedies
hereunder. The Subordinated Creditors further authorize the Agent to file UCC
financing statements and any amendments thereto or continuations thereof with
regard to the Subordinated Obligations without the Subordinated Creditors'
signatures.
13. Expenses. The Obligor agrees to pay to the Agent, upon
demand, the amount of any and all reasonable expenses, including the reasonable
fees and expenses of counsel for the Agent, which the Agent may incur in
connection with the exercise
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or enforcement against the Subordinated Creditors of any of the rights or
interests of the Agent or the Lenders hereunder.
14. Notice. All demands, notices and other communications
which any party hereto may desire or may be required to give to any other party
hereunder shall be in writing (including telegraphic communication) and shall
be mailed, telecopied, telegraphed or delivered to such other party at its
address as set forth on the signature pages hereof or to any such party at such
other address as shall be designated by such party in a written notice to each
other party, complying as to delivery with the terms of this Section 14. All
such demands, notices, and other communications shall be effective when
received.
15. SERVICE OF PROCESS. EACH OF THE SUBORDINATED CREDITORS
AND THE OBLIGOR (A) HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE
COURTS OF THE STATE OF NEW YORK AND THE JURISDICTION OF THE UNITED STATE
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, FOR THE PURPOSE OF ANY
SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON THIS
SUBORDINATION AGREEMENT OR THE SUBJECT MATTER HEREOF BROUGHT BY THE AGENT OR
ITS SUCCESSORS OR ASSIGNS AND (B) HEREBY WAIVES AND AGREES NOT TO ASSERT, BY
WAY OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF
THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT
OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT
FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER OR THAT
THIS SUBORDINATION AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE ENFORCED
IN OR BY SUCH COURT, AND (C) HEREBY WAIVES IN ANY SUCH ACTION, SUIT OR
PROCEEDING ANY OFFSETS OR COUNTERCLAIMS (EXCEPT FOR COMPULSORY COUNTERCLAIMS).
EACH OF THE SUBORDINATED CREDITORS AND THE OBLIGOR HEREBY CONSENTS TO SERVICE
OF PROCESS BY REGISTERED MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN.
EACH OF THE SUBORDINATED CREDITORS AND THE OBLIGOR AGREES THAT ITS SUBMISSION
TO JURISDICTION AND ITS CONSENT TO SERVICE OF PROCESS BY MAIL IS MADE FOR THE
EXPRESS BENEFIT OF THE AGENT. FINAL JUDGMENT AGAINST THE SUBORDINATED
CREDITORS OR THE OBLIGOR IN ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE
CONCLUSIVE, AND MAY BE ENFORCED IN OTHER JURISDICTIONS (A) BY SUIT, ACTION OR
PROCEEDING ON THE JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL BE
CONCLUSIVE EVIDENCE OF THE FACT AND OF THE AMOUNT OF ANY INDEBTEDNESS OR
LIABILITY OF THE
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SUBORDINATED CREDITORS OR THE OBLIGOR THEREIN DESCRIBED OR (B) IN ANY OTHER
MANNER PROVIDED BY OR PURSUANT TO THE LAWS OF SUCH OTHER JURISDICTION;
PROVIDED, HOWEVER, THAT THE AGENT MAY AT ITS OPTION BRING SUIT, OR INSTITUTE
OTHER JUDICIAL PROCEEDINGS AGAINST THE SUBORDINATED CREDITORS OR THE OBLIGOR OR
ANY OF THEIR RESPECTIVE ASSETS IN ANY STATE OR FEDERAL COURT OF THE UNITED
STATES OR OF ANY COUNTRY OR PLACE WHERE THE SUBORDINATED CREDITORS, THE OBLIGOR
OR THEIR RESPECTIVE ASSETS MAY BE FOUND. EACH OF THE SUBORDINATED CREDITORS
AND THE OBLIGOR FURTHER COVENANTS AND AGREES THAT SO LONG AS THIS SUBORDINATION
AGREEMENT SHALL BE IN EFFECT, EACH SHALL MAINTAIN A DULY APPOINTED AGENT FOR
THE RECEIPT AND ACCEPTANCE ON ITS BEHALF OF SERVICE OF SUMMONS AND OTHER LEGAL
PROCESSES, AND UPON FAILURE TO DO SO THE CLERK OF EACH COURT TO WHOSE
JURISDICTION IT HAS SUBMITTED SHALL BE DEEMED TO BE ITS RESPECTIVE DESIGNATED
AGENT UPON WHOM SUCH PROCESS MAY BE SERVED ON ITS BEHALF, AND NOTIFICATION BY
THE ATTORNEY FOR PLAINTIFF, COMPLAINANT OR PETITIONER THEREIN BY MAIL OR
TELEGRAPH TO ANY SUBORDINATED CREDITOR OR THE OBLIGOR OF THE FILING OF EACH
SUIT, ACTION OR PROCEEDING SHALL BE DEEMED SUFFICIENT NOTICE THEREOF.
16. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES, AND
COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR
OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE,
CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS
SUBORDINATION AGREEMENT OR THE SUBJECT MATTER HEREOF, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING OR WHETHER IN CONTRACT OR TORT OR OTHERWISE.
EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED THAT THE PROVISIONS OF
THIS SECTION 16 CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH THE OTHER PARTIES
HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO THIS SUBORDINATION
AGREEMENT. THE PARTIES HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION 16 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF SUCH OTHER
PARTY TO THE WAIVER OF ITS RIGHTS TO TRIAL BY JURY.
17. Miscellaneous.
a. No amendment of any provision of this Subordination
Agreement shall be effective unless it is in writing and signed by the
Subordinated Creditors, the Obligor and the Agent, and no
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waiver of any Subordination Agreement, and no consent to any departure
therefrom, shall be effective unless it is in writing and signed by the Agent,
and any such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
b. No failure on the part of the Agent to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right.
c. Any provision of this Subordination Agreement which is
prohibited or unenforceable in any jurisdiction, shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or invalidity
without invalidating the remaining portions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
d. This Subordination Agreement shall be binding on the
Subordinated Creditors and the Obligor and their respective successors and
assigns including, without limitation, any holders of the instruments
evidencing the Subordinated Obligations.
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350
e. This Subordination Agreement, and any modifications or
amendments hereto, may be executed by one or more of the parties to this
Subordination Agreement on any number of separate counterparts, and all said
counterparts taken together shall be deemed to constitute one and the same
instrument.
f. This Subordination Agreement and any supplement or
agreement required hereunder shall be governed by and construed in accordance
with the laws of the State of New York without regard to principles of
conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have executed this
Subordination Agreement on the date first above written.
OBLIGOR:
ORION PICTURES CORPORATION
By_________________________
Name:
Title:
Address: 1888 Century Park East
Los Angeles, CA 90067
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
with a copy to:
▇▇▇▇, ▇▇▇▇▇, Rifkind,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇
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SUBORDINATED CREDITORS:
METROMEDIA COMPANY, a general
partnership
By_________________________
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇
By_________________________
▇▇▇▇ ▇. ▇▇▇▇▇
Address: c/o Metromedia Company
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
CHEMICAL BANK,
as Agent
Executed in New York, New
York on ________, 1995 By_________________________
Name:
Title:
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, III
with a copy to:
CBC-USA, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-16-
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SCHEDULE 1
Revolving Credit Term Loan
Lender Commitment Commitment
---------------------------------- ---------------- ----------
CHEMICAL BANK $14,000,000 $16,000,000
DE NATIONALE INVESTERINGSBANK, N.V. 6,000,000 9,000,000
THE FIRST NATIONAL BANK 6,000,000 9,000,000
OF BOSTON
AMSOUTH BANK OF ALABAMA 4,000,000 6,000,000
THE BANK OF CALIFORNIA, N.A. 4,000,000 6,000,000
THE BANK OF NEW YORK 4,000,000 6,000,000
BANQUE FRANCAISE DU COMMERCE 4,000,000 6,000,000
EXTERIEUR
IMPERIAL BANK 4,000,000 6,000,000
SUMITOMO TRUST & BANKING CO., LTD., 4,000,000 6,000,000
NEW YORK BRANCH
PILGRIM PRIME RATE TRUST 0 10,000,000
PRIME INCOME TRUST 0 10,000,000
PROTECTIVE LIFE INSURANCE COMPANY 0 10,000,000
VAN ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PRIME 0 15,000,000
RATE INCOME TRUST
SENIOR DEBT PORTFOLIO 0 10,000,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING
RATE FUND, INC. 0 5,000,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ PRIME RATE
PORTFOLIO 0 5,000,000
----------- ------------
$50,000,000 $135,000,000
353
Exhibit 10(h)
EXECUTION COPY
================================================================================
CREDIT AGREEMENT
between
METROMEDIA INTERNATIONAL GROUP, INC.
and
CHEMICAL BANK
Dated as of November 1, 1995
================================================================================
354
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2. AMOUNT AND TERMS OF COMMITMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.1 Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.2 Procedure for Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.3 Commitment Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.4 Termination or Reduction of Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.5 Repayment of Loans; Evidence of Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.6 Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.7 Conversion and Continuation Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.8 Minimum Amounts and Maximum Number of Tranches . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.9 Maintenance, of Loan to Value Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.10 Interest Rates and Payment Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.11 Computation of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.12 Inability to Determine Interest Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.13 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.14 Requirements of Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.15 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.16 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.17 Change of Lending Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 3. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.1 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.2 No Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3.3 Existence; Compliance with Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3.4 Corporate Power; Authorization; Enforceable Obligations . . . . . . . . . . . . . . . . . . . . . . . . 20
3.5 No Legal Bar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3.6 No Material Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3.7 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3.8 Ownership of Property; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.9 Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.11 Federal Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.12 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.13 Investment Company Act; Other Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
3.14 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
3.15 Purpose of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
355
Page
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3.17 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
3.18 Regulation H . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
4.1 Conditions to Initial Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
4.2 Conditions to Each Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 5. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
5.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
5.2 Certificates; Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
5.3 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
5.4 Conduct of Business and Maintenance of Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
5.5 Maintenance of Property; Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
5.6 Inspection of Property; Books and Records; Discussions . . . . . . . . . . . . . . . . . . . . . . . . 30
5.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
5.8 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
5.9 Registration of Stock of Roadmaster Industries, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 6. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
6.1 Limitation on Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
6.2 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
6.3 Limitation on Guarantee Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.4 Limitation on Fundamental Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.5 Limitation on Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.6 Limitation on Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.7 Limitation on Investments, Loans and Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6.8 Limitation on Optional Payments and Modifications of Debt Instruments . . . . . . . . . . . . . . . . . 36
6.9 Limitation on Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.10 Limitation on Sales and Leasebacks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.11 Limitation on Lines of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 7. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 8. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
8.4 Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
8.5 Payment of Expenses and Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
8.6 Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
8.7 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ii
356
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8.8 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
8.9 Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
8.10 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
8.11 Submission To Jurisdiction; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
8.12 Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
8.13 WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
8.14 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SCHEDULES
3.3 Existence
3.12 ERISA
3.14 Subsidiaries
3.17 Environmental Matters
6.1 Indebtedness
6.2 Liens
6.3 Guarantees
6.7 Loans and Advances
6.9 Transactions with Affiliate
EXHIBITS
Exhibit A Form of Note
Exhibit B Form of Opinion of Long, ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇
Exhibit C Form of Closing Certificate
Exhibit D Form of MITI Guarantee
Exhibit E Form of Intercreditor Agreement
Exhibit F Form of Snapper Mortgage
Exhibit G Form of Stock Pledge Agreement
Exhibit H Form of Snapper Security Agreement
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