EXHIBIT 4(f)
FIFTH MODIFICATION AGREEMENT
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FIFTH MODIFICATION AGREEMENT ("AGREEMENT") ENTERED INTO AS OF THE 11TH DAY OF
JUNE, 2001 BY AND BETWEEN KABLE NEWS COMPANY, INC., AN ILLINOIS CORPORATION
("BORROWER"), AMREP CORPORATION, AN OKLAHOMA CORPORATION ("PARENT"), KABLE NEWS
EXPORT, LTD., A DELAWARE CORPORATION, KABLE NEWS COMPANY OF CANADA LTD., AN
ONTARIO, CANADA CORPORATION, KABLE NEWS INTERNATIONAL, INC., A DELAWARE
CORPORATION, KABLE FULFILLMENT SERVICES OF OHIO, INC., A DELAWARE CORPORATION,
DISTRIBUNET INC., A DELAWARE CORPORATION AND MAGAZINE CONNECTION INC., A
DELAWARE CORPORATION (COLLECTIVELY REFERRED TO HEREIN AS "SUBSIDIARIES" AND
BORROWER, PARENT AND SUBSIDIARIES COLLECTIVELY REFERRED TO HEREIN AS "BORROWING
PARTIES"), AND AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO INDIVIDUALLY
AND AS AGENT ("AGENT") FOR HELLER FINANCIAL, INC. ("HELLER"), FIFTH THIRD BANK,
CHICAGO FORMERLY KNOWN AS OLD KENT BANK ("FIFTH THIRD"), NATIONAL CITY BANK OF
MICHIGAN/ILLINOIS ("NATIONAL CITY") AND FIRST BANK ("FIRST BANK") (AGENT,
HELLER, FIFTH THIRD, NATIONAL CITY AND FIRST BANK COLLECTIVELY REFERRED TO
HEREIN AS "LENDERS")
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, Borrower has executed that certain Loan Agreement dated September 15,
1998 as modified by that certain Modification Agreement ("First Modification")
dated July 7, 1999, that certain Second Modification Agreement ("Second
Modification") dated June 29, 2000, that certain Third Modification Agreement
("Third Modification") dated December 15, 2000 and that certain Fourth
Modification Agreement ("Fourth Modification") dated March 16, 2001 (the "Loan
Agreement") relating to certain Loans ("Loans") made by Lenders to Borrower, to
wit, a certain Forty Million and No/100 Dollar ($40,000,000.00) Secured
Revolving Credit Facility, a certain One Million Two Hundred Thousand and No/100
Dollar ($1,200,000.00) Secured Term Loan and a certain One Million Five Hundred
Thousand and No/100 Dollar ($1,500,000.00) Secured Term Loan; and
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WHEREAS, the Loans are evidenced by Notes (the "Notes") executed by
Borrower and delivered to the Lenders; and
WHEREAS, in connection with the Loans, Borrower and each Subsidiary have
executed and delivered certain Security Agreements ("Security Agreements"); and
WHEREAS, in connection with the Loans, Borrower has executed and delivered
that certain Trademark Collateral Assignment and Security Agreement ("Trademark
Assignment"); and
WHEREAS, in connection with the Loans, Parent and each Subsidiary have
executed and delivered those certain Guaranties ("Guaranties"); and
WHEREAS, in connection with the Loans, Parent has executed and delivered
that certain Stock Pledge Agreement ("Stock Pledge"); and
WHEREAS, Borrower has failed to comply with Section 6.24.2 of the Loan
Agreement (the "Financial Covenant Non Compliance") and Lenders have granted a
limited waiver of the Financial Covenant Non Compliance pursuant to the Fourth
Modification and at the time of the execution of the Fourth Modification there
was also executed by Borrower and delivered to Lender a certain Note Pledge
Agreement ("Note Pledge Agreement") dated March 16, 2001 pledging to Agent for
the ratable benefit of the Lenders that certain Note ("Pledged Note") dated
March 16, 2001 in the original principal amount of Four Million Four Hundred
Thousand and No/100 Dollars ($4,400,000.00) executed by Parent and payable to
Borrower (the Loan Agreement, Notes, Security Agreements, Trademark Assignment,
Guaranties, Stock Pledge Agreement and Note Pledge Agreement together with the
First Modification, Second Modification, Third Modification, Fourth
Modification, this Agreement and the herein defined Additional Loan Documents
are collectively referred to herein as the "Loan Documents"); and
WHEREAS, subsequent to the execution of the Fourth Modification, Borrowing
Parties and Agent on behalf of the Lenders have executed that certain
Forbearance Agreement ("Forbearance Agreement") dated April 30, 2001 which among
other matters provided that Lenders would forbear from exercising all their
rights and remedies under the Loan Documents as a result of certain "Existing
Defaults" as defined in the Forbearance Agreement for a limited period of time
but for no later than May 31, 2001 (the "Forbearance Period"); and
WHEREAS the Forbearance Period has now expired and Lenders and Borrowing
Parties are desirous of setting forth the terms of their continued relationship
as borrower and lenders as restructured and modified (the "Loan Restructuring")
in accordance with and on the conditions as set forth herein.
NOW THEREFORE, in consideration of the mutual premises of the parties
hereto, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged,
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IT IS AGREED:
1. Preambles. The preambles to this Agreement are fully incorporated herein
by this reference thereto with the same force and effect as though restated
herein.
2. Defined Terms. To the extent not otherwise defined herein to the
contrary, all capitalized terms and/or phrases used in this Agreement shall have
the respective meanings assigned to them in the Loan Documents.
3. Continued Loan Relationship and Loan Restructuring. Borrowing Parties
and Lenders hereby agree that they will continue their loan relationship in
accordance with the Loan Documents conditioned however on:
(a) An amendment of the Loan Documents which restructures the terms of
the Loans as set forth hereafter in this Agreement,
(b) The delivery by Borrowing Parties of the Additional Loan Documents
as set forth in Paragraph 4 hereof, and
(c) Borrowing Parties compliance with all the other terms and
conditions of this Agreement.
4. Additional Loan Documents. Borrowing Parties will execute and deliver or
cause the following documents (the "Additional Loan Documents") to be delivered
to Agent on behalf of the Lenders in a form and content acceptable to Agent and
its counsel:
Contemporaneously with the execution of this Agreement:
(a) Mortgage or Deed of Trust (the "Colorado Mortgage") encumbering a
certain parcel of vacant land, located in Douglas County, Colorado (the
"Colorado Property") executed by Amrepco, Inc., a Colorado corporation
("Amrepco").
(b) Collateral Assignment ("Amrepco Assignment") of all right, title
and interest of Amrepco under (i) that certain Escrow Agreement (the
"Collateral Escrow Agreement") relating to the sale of the Colorado
Property to Penrose Island Development, LLC ("Penrose"), (ii) that certain
Purchase and Sale Agreement ("Colorado Sale Agreement") dated April 27,
2001 and all amendments thereto between Amrepco and Scott L. Carlson and
subsequently assigned by Scott L. Carlson to Penrose and (iii) that certain
note dated April 30, 2001 in the original principal amount of Six Million
Nine Hundred Seventy Thousand Four Hundred and No/100 Dollars
($6,970,400.00) executed by Penrose and payable to Amrepco and collateral
assignment of deed of trust relating to the Pledged Note executed by
Amrepco ("Deed of Trust Assignment").
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(c) ALTA mortgage loan policy from a title company acceptable to Agent
insuring the lien of the Colorado Mortgage on the Colorado property in a
form and content acceptable to Agent and its counsel.
(d) ALTA survey of the Colorado Property in a form and content
acceptable to Agent and its counsel.
(e) Mortgage or Deed of Trust and Assignment of Rents (the "Illinois
Mortgage") encumbering those certain parcels of real estate and
improvements thereon located in Ogle County, Illinois (the "Illinois
Property") executed by Borrower.
(f) Mortgage or Deed of Trust and Assignment of Rents (the "Ohio
Mortgage") encumbering those certain parcels of real estate and
improvements thereon located in Marion County, Ohio (the "Ohio Property")
executed by Kable Fulfillment Services of Ohio, Inc., a Delaware
corporation ("Fulfillment").
(g) Environmental report in a form and content acceptable to Agent on
the Colorado Property.
(h) UCC-1 Financing Statements executed by Amrepco, Borrower,
Fulfillment and Magazine Connection Inc. ("Connection"), a Delaware
corporation relating to the Amrepco Assignment, Colorado Mortgage, Illinois
Mortgage, Ohio Mortgage, as well as the Amendment of the Trademark
Assignment and Trademark Assignment Agreement described in (l) and (m)
below.
(i) Consent Letter from Wells Fargo addressed to Agent consenting to
the transfer by Amrepco of Four Million Four Hundred Thousand and No/100
Dollars ($4,400,000.00) from the proceeds of the sale of the Colorado
Property to Parent free and clear of any claim of Wells Fargo for use in
satisfying in full the payment of the Parent Note as defined in the Loan
Agreement.
(j) Flood Plain Certificates for the Colorado Property, Illinois
Property and Ohio Property.
(k) UCC-1 Financing Statements executed by Magazine Connection Inc.
for filing in Illinois and Texas.
(l) Amendment of the Trademark Assignment executed by Borrower to
reflect the addition of a new trademark to wit "Magazine Connection".
(m) Trademark Assignment Agreement executed by Connection.
(n) Copies of all documents of record affecting the Colorado Property.
(o) Certificates of insurance showing Agent as mortgagee and lender
loss payee relating to the Ohio Property and Illinois Property.
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(p) Environmental Indemnity Agreements executed by Borrower,
Fulfillment and Amrepco relating to the Illinois Property, Ohio Property
and Colorado Property respectively.
(q) Corporate certificates with attached (i) certified copy of
Articles of Incorporation, (ii) By-laws, (iii) certificate of incumbency,
(iv) current good standing certificate and (v) corporate resolutions for
all Borrowing Parties and Amrepco.
(r) Opinion letters from counsel to Borrowing Parties and Amrepco in a
form and content acceptable to Agent and its counsel.
And by no later than July 15, 2001:
(i) ALTA mortgagee loan policy from a title company acceptable to
Agent insuring the lien of the Illinois Mortgage on the Illinois
Property in a form and content acceptable to Agent and its counsel.
(ii) ALTA Survey of the Illinois Property in a form and content
acceptable to Agent and its counsel.
(iii) ALTA Loan Policy from a title company acceptable to Agent
insuring the lien of the Ohio Mortgage on the Ohio Property in a form
and content acceptable to Agent and its counsel.
(iv) ALTA Survey of the Ohio Property in a form and content
acceptable to Agent and its counsel.
(v) Current UCC, tax and judgment lien searches for all Borrowing
Parties and Amrepco showing no matters unacceptable to Agent.
(vi) Environmental reports in a form and content acceptable to
Agent on the Illinois Property and Ohio Property.
(vii) Copies of all documents of record affecting the Illinois
Property.
(viii) Copies of all documents of record affecting the Ohio
Property.
5. Modification of Loan Agreement. It is hereby agreed that the Loan
Agreement be and hereby is modified as follows effective as of the date of this
Agreement:
(a) The definition of "Facility Termination Date" is hereby restated
to read:
"Facility Termination Date" means July 31, 2001. However, said
Facility Termination Date will be automatically extended to
(i) September 30, 2001 if by no later than July 31, 2001, the
principal balance of the Revolving Loan outstanding is
permanently reduced to Twenty Five Million Six Hundred Thousand
and No/100 Dollars ($25,600,000.00), and further extended,
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(ii) to May 1, 2002 if by no later than September 30, 2001,
Parent has repaid the full principal amount of Four Million Four
Hundred Thousand and No/100 Dollars ($4,400,000.00) due on the
Parent Note to Borrower ("Parent Repayment") and the full amount
of said Parent Repayment has been paid to Agent for the ratable
benefit of all Lenders to reduce the then outstanding principal
balance of the Revolving Loan."
(b) The definition of "Revolving Loan Commitment" is hereby restated
to read:
"Revolving Loan Commitment" means that portion of the Aggregate
Commitment equal to (i) Thirty Million and No/100 Dollars
($30,000,000.00) for the period commencing June 11, 2001 to and
including July 30, 2001 ("First Period") but permanently reduced
to Twenty Five Million Six Hundred Thousand and No/100 Dollars
($25,600,000.00) on the day of receipt by Agent of the full
Parent Repayment if said Parent Repayment is received during the
First Period; (ii) Twenty Five Million Six Hundred Thousand and
No/100 Dollars ($25,600,000.00) for the period from July 31, 2001
to December 30, 2001 ("Second Period"); (iii) Twenty Three
Million Five Hundred Thousand and No/100 Dollars ($23,500,000.00)
for the period from December 31, 2001 to April 29, 2002 ("Third
Period"); and (iv) Twenty Million Five Hundred Thousand and
No/100 Dollars ($20,500.000.00) for the period from April 30,
2002 and at all times thereafter ("Fourth Period"). The amounts
of the Revolving Loan Commitment stated in the Second Period,
Third Period and Fourth Period above shall all automatically be
permanently reduced by Five Hundred Thousand and No/100 Dollars
($500,000.00) upon receipt by Borrower of the Imaging Lease
Financing."
(c) The following additional definitions are hereby added to Article
I:
"Imaging Project" means the acquisition by Borrower of certain
Banctec Transports, file servers, workstations, licenses and
professional services and other miscellaneous costs not to exceed
in the aggregate One Million Nine Hundred Forty Seven Thousand
and No/100 Dollars ($1,947,000.00.)"
"Imaging Lease Financing" means receipt of funds from a
third-party lender or lenders for lease or conventional financing
for a portion of the Imaging Project in an aggregate amount of at
least One Million Four Hundred Thousand and No/100 Dollars
($1,400,000.00)."
"Parent Note" means that certain Note dated March 16, 2001
executed by Parent payable to Borrower in the original principal
amount of Four Million Four Hundred Thousand and No/100 Dollars
($4,400,000.00)."
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(d) Section 2.17 of the Loan Agreement is hereby restated to read:
"2.17 Limitation on Outstanding Amount of Revolving Loan. At no
time shall the outstanding amount of the Revolving Loan exceed
the lesser of (x) the then Revolving Loan Commitment or
(y) (i) for the period from June 11, 2001 to the date of the
receipt of the Parent Repayment by Agent eighty percent (80%) of
the Eligible Accounts, (ii) from the date of the receipt by Agent
of the Parent Repayment to December 30, 2001, seventy-five
percent (75%) of the Eligible Accounts, and (iii) from
December 31, 2001 through May 1, 2002, seventy percent (70%) of
the Eligible Accounts."
(e) The following sentence is hereby added to Section 6.1(ii) of the
Loan Agreement:
"Said interim monthly financial statements shall include monthly
balance sheets, profit and loss statements, and cash flow
statements prepared in accordance with GAAP (but without the full
footnotes GAAP calls for) and a direct gross margin contribution
report by line of business for the Borrower and each Subsidiary."
(f) In addition to all other reporting requirements contained in
Section 6.1 of the Loan Agreement, the following additional reporting
requirement is hereby added:
"(xv) Within twenty-five (25) days of the end of each fiscal
quarter of Borrower, a financial report on the results of the
Investments, as defined in the Second Modification Agreement
dated June 29, 2000 in a form and content acceptable to Agent."
(g) Section 6.14(vii) of the Loan Agreement is hereby restated to
read:
"(vii) Loans to publishers evidenced by promissory notes which
shall bear interest on the unpaid principal balance as well as
advances or loans to publishers for movie tie-ins even if not
evidenced by a promissory note but all of which shall not exceed
One Million Five Hundred Thousand and No/100 Dollars
($1,500,000.00) in the aggregate. The name of each publisher and
the amounts of said loans or advances shall be included in the
monthly Compliance Certificate required to be delivered under
Section 6.1(x) hereof."
(h) The phrase "(a) may pay to the Parent on a quarterly basis an
amount not to exceed fifty percent (50%) of the Borrower's Consolidated Net
Income after provision for income taxes for the preceding fiscal quarter,
as shown on the Borrower's financial statements, provided, however, that at
the end of any fiscal year the aggregate of such quarterly payments shall
not exceed fifty percent (50%) of the Borrower's Consolidated Net Income
after provision for income taxes for such fiscal year" is hereby deleted
from Section 6.10 of the Loan Agreement.
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(i) Section 6.14(viii) of the Loan Agreement is hereby restated to
read:
"(viii) Loans or advances to Parent or any Affiliate not
exceeding in the aggregate (x) One Hundred Thousand and No/100
Dollars ($100,000.00) plus (y) the principal balance of the
Parent Note until repaid, plus (z) amounts lent or advanced to
the Parent to pay state and federal taxes attributable to its
ownership of Borrower and Subsidiaries."
(j) Section 6.24.2 of the Loan Agreement is hereby restated to read:
"6.24.2 Consolidated Cash Flow Coverage. The Borrower will
maintain a Consolidated Cash Flow Coverage Ratio calculated on a
trailing twelve month basis at all times equal to the following
ratios for the periods indicated:
Period Ratio
From May 31, 2001 to Not less than .6 to 1.
July 31, 2001
From August 1, 2001 to Not less than .65 to 1.
September 30, 2001
From October 1, 2001 to Not less than .75 to 1.
November 30, 2001
From December 1, 2001 to Not less than .85 to 1.
December 31, 2001
From January 1, 2002 to Not less than 1.5 to 1.
March 31, 2002
From April 1, 2002 to Not less than 2. to 1."
May 1, 2002
(k) Section 6.24.3 of the Loan Agreement is hereby restated to read:
"6.24.3 Consolidated Tangible Net Worth. The Borrower will
maintain the following minimum Consolidated Tangible Net Worth
amounts at all times during the following periods:
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Consolidated Tangible
Period Net Worth
From May 31, 2001 to $8,000,000.00
October 30, 2001
From October 31, 2001 to $8,500,000.00
January 30, 2002
From January 31, 2002 to $9,000,000.00
April 29, 2002
From April 30, 2002 and $9,500,000.00"
thereafter
For the purpose of determining Consolidated Tangible Net Worth
under this Section, the principal balance of the Parent Note will not
be excluded.
(l) Section 6.14(v) is hereby deleted from the Loan Agreement.
(m) The following additional covenants are hereby added to Article VI
of the Loan Agreement.
"6.27 Limitation of Investments in Connection. During the period
from May 1, 2001 to April 30, 2002 the sum of all "Connection
Investments" by Borrower or any of its Subsidiaries in Connection
shall not exceed Seven Hundred Fifty Thousand and No/100 Dollars
($750,000.00). As used herein the term "Connection Investments"
means the aggregate of all (a), capital contributions to
Connection in the form of cash or property for any purpose, (b)
loans for any purpose to Connection, (c) any guaranty of any debt
of Connection, (d) a pledge of any assets of Borrower or any of
its Subsidiaries to secure any debt of Connection, (e) cash paid
or property transferred to acquire any ownership interest in or
the right to acquire any ownership interest in Connection, and
(f) cash advances to Connection to fund operating losses of
Connection. The determination of the value of any property used
in calculating the amount of the Connection Investments shall be
done by Agent in its sole discretion. Borrower further agrees
that in addition to all other matters to be shown on the
Compliance Certificate that there also shall be shown thereon in
a form and content acceptable to Agent the amount of the
outstanding Connection Investments.
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6.28 Limitations on Investments in the Partnerships and
Management. Notwithstanding anything to the contrary contained in
this Agreement, during the period from May 1, 2001 to April 30,
2002, Borrower and Subsidiaries of Borrower shall not make
Investments, as said term is defined in Paragraph 4 of the Second
Modification Agreement dated June 29, 2000 entered into and
between Agent, Borrower and all Subsidiaries of Borrower, in the
Partnerships or Management which exceed in the aggregate Five
Hundred Thousand and No/100 Dollars ($500,000.00.)"
(n) The reference to "50 Basis Points" contained in the Pricing
Schedule attached to the Loan Agreement is hereby changed to "100 Basis
Points".
(o) In addition to all other Defaults contained in Article VII of the
Loan Agreement the following events shall also constitute a Default under
the Loan Agreement:
"7.22 Failure of Borrower, Parent or any Subsidiary to fulfill
any of the terms and conditions contained in that certain Fifth
Modification Agreement ("Fifth Modification") dated June 11, 2001
executed by Agent, Borrower, Parent and Subsidiaries.
7.23 A default or event of default occurs under the Additional
Loan Documents as said term is defined in the Fifth
Modification."
6. Conditions Precedent. Agent's execution of the present Agreement on
behalf of all Lenders and their agreement to the terms and conditions hereof is
expressly conditioned on the delivery to Agent of the following documents in a
form and content acceptable to Agent and its counsel:
(a) Duplicate counterparts of this Agreement executed by the Borrowing
Parties,
(b) Payment of the Extension Fee,
(c) Delivery of the Additional Loan Documents,
(d) Payment of all Costs.
7. Extension Fee. In consideration of Lenders entering into the present
Agreement and modifying and restructuring the Loans as described herein,
Borrower shall pay to Agent for the ratable benefit of all Lenders an extension
fee (the "Extension Fee") equal to Seventy Five Thousand and No/100 Dollars
($75,000.00) contemporaneously with the execution of this Agreement.
8. Release of Colorado Mortgage, Amrepco Assignment and Deed of Trust
Assignment. Agent shall cause North American Title Company as escrow agent to
release the Colorado Mortgage, Amrepco Assignment and Deed of Trust Assignment
upon the payment to Agent for the ratable benefit of all Lenders the full amount
of the Parent Note equaling Four Million Four Hundred Thousand and No/100
Dollars ($4,400,000.00).
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9. Release of Ohio Mortgage. Provided no Default or Unmatured Default then
exists, Agent shall release the Ohio Mortgage contemporaneously with the sale of
the Ohio Property to a third party by Fulfillment in an arms-length transaction
(the "Bona Fide Sale") but only on the conditions that:
(a) All the net proceeds ("Net Proceeds") of the Bona Fide Sale shall
be deposited with Agent for the ratable benefit of all Lenders and only
released to Fulfillment to pay for expenses for leasehold improvements to
Fulfillment's business location in Ohio, and
(b) Agent for the ratable benefit of all the Lenders is given a valid
first lien on all said leasehold improvements to be evidenced by such
documents as may be required by Agent and its counsel.
To the extent said Net Proceeds are not used for the aforesaid leasehold
improvements, they shall be paid to Agent for the ratable benefit of all Lenders
and the then amount of the Revolving Loan Commitment reduced by the amount of
said application.
10. Costs. Concurrently with the execution of this Agreement, Borrower
shall pay or cause to be paid to Agent in immediately available funds all fees
and expenses of Lenders relating to this Agreement and the transactions
contemplated herein, including, without limitations, reasonable fees and
expenses of Agent's counsel (the "Costs").
11. Other Loan Documents Modifications. All Loan Documents are hereby
deemed amended and modified to provide that any and all references to any Loan
Documents therein are hereby deemed to be references to said Loan Documents as
modified by this Agreement.
12. Other Documents. At Agent's request, the Borrowing Parties hereby agree
to execute and deliver promptly to Agent such other documents as Agent, in its
reasonable discretion, shall deem necessary or appropriate to evidence the
transactions contemplated herein.
13. Reaffirmation. The Borrowing Parties do hereby reaffirm each and every
covenant, condition, obligation and provision set forth in the Loan Documents,
as modified hereby. The Borrowing Parties hereby restate and reaffirm all of the
warranties and representations contained in the Loan Documents, as modified
hereby, as being true and correct as of the date hereof.
14. References. All references herein to any of the Loan Documents shall be
understood to be to the Loan Documents as modified hereby. All references in any
of the Loan Documents to any other one or more of the Loan Documents shall
hereafter be deemed to be to such document(s) as modified hereby.
15. No Defense, Counterclaims. Each Borrowing Party hereby represents and
warrants to, and covenants with, Lenders that as of the date hereof, (a) each
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Borrowing Party has no defenses, offsets or counterclaims of any kind or nature
whatsoever against any Lender with respect to the Loans or any of the Loan
Documents, or any action previously taken or not taken by any Lender with
respect thereto or with respect to any security interest, encumbrance, lien or
collateral in connection therewith to secure the liabilities of each Borrowing
Party, and (b) that the Lenders have fully performed all obligations to each
Borrowing Party which it may have had or has on and of the date hereof.
16. Release. Without limiting the generality of the foregoing, each
Borrowing Party, on its own behalf and on the behalf of its representatives,
partners, shareholders, subsidiaries, affiliated and related entities,
successors and assigns (hereinafter collectively referred to as the "Borrowing
Group" and as to the Borrowing Group, each Borrowing Party represents and
warrants that it has the right, power and authority to waive, release and
forever discharge on behalf of the Borrowing Group, the "Bank Group" as
hereinafter defined) waives, releases and forever discharges each Lender, and
their respective officers, directors, subsidiaries, affiliated and related
companies or entities, agents, servants, employees, shareholders,
representatives, successors, assigns, attorneys, accountants, assets and
properties, as the case may be (together hereinafter referred to as the "Bank
Group") from and against all manner of actions, cause and causes of action,
suits, debts, sums of money, accounts, reckonings, bonds, bills, specialties,
covenants, contracts, controversies, agreements, promises, obligations,
liabilities, costs, expenses, losses, damages, judgments, executions, claims and
demands, of whatsoever kind or nature, in law or in equity, whether known or
unknown, whether or not concealed or hidden, arising out of or relating to any
matter, cause or thing whatsoever, that any of the Borrowing Group, jointly or
severally, may have had, or now have or that may subsequently accrue against the
Bank Group by reason of any matter or thing whatsoever arising out of or in way
connected to, directly, or indirectly, the Loans and/or any of the Loan
Documents through the date hereof, Each Borrowing Party acknowledges and agrees
that Lenders are specifically relying upon the representations, warranties,
covenants and agreements contained herein and that such representations,
warranties, covenants and agreements constitute a material inducement to enter
into this Agreement.
17. No Custom. This Agreement shall not establish a custom or waive, limit
or condition the rights and remedies of Lenders under the Loan Documents, all of
which rights and remedies are expressly reserved.
18. Reaffirmation of Loan Documents, No Novation. Except as may be
expressly set forth herein to the contrary, the Loan Documents remain
unmodified, and all other terms and conditions thereof remain in full force and
effect. Notwithstanding anything to the contrary contained herein, Borrowing
Parties and Lenders expressly state, declare and acknowledge that this Agreement
is intended only to modify each Borrowing Party's continuing obligations in the
manner set forth herein, and is not intended as a novation of any and all
amounts presently due and owing from any Borrowing Party to Lenders.
19. Captions; Counterparts. The captions used herein are for convenience of
reference only and shall not be deemed to limit or affect the construction and
interpretation of the terms of this Agreement. This Agreement may be signed in
counterparts, each of which shall be deemed an original and all of which shall
be deemed one Agreement.
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20. Choice of Law and Severability. This Agreement shall be governed and
construed under the laws of the State of Illinois. If any provision of this
Agreement is held invalid or unenforceable, the remainder of this Agreement will
not be affected thereby and the provisions of this Agreement shall be severable
in any such instance.
(THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK AND THE SIGNATURES BEGIN
ON THE NEXT PAGE.)
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
BORROWER:
KABLE NEWS COMPANY, INC.,
an Illinois corporation
By: /s/ Michael P. Duloc
Title: President
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PARENT: KABLE NEWS INTERNATIONAL, INC., a
Delaware corporation
AMREP CORPORATION, an Oklahoma
corporation
By: /s/ Michael P. Duloc
By: /s/ Peter M. Pizza Title: President
Title: Vice President
KABLE FULFILLMENT SERVICES OF
OHIO, INC., a Delaware corporation
SUBSIDIARIES:
KABLE NEWS EXPORT, LTD., a Delaware By: /s/ Bruce Obendorf
corporation
Title: Vice President
By: /s/ Michael P. Duloc
Title: President
DISTRIBUNET INC., a Delaware
corporation
KABLE NEWS COMPANY OF CANADA LTD.,
an Ontario, Canada corporation By: /s/ Michael P. Duloc
Title: President
By: /s/ Michael P. Duloc
Title: President
MAGAZINE CONNECTION INC., a
Delaware corporation
By: /s/ Michael P. Duloc
Title: President
LENDERS:
AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO, as Agent and Lender
By: /s/ Susan B Kreusi
Title: First Vice President
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FIFTH THIRD BANK, CHICAGO
By: /s/ Jeffrey S. Armstrong
Title: Vice President
NATIONAL CITY BANK OF MICHIGAN/ILLINOIS
By: /s/ Elizabeth Brandt
Title: Vice President
FIRST BANK
By: /s/ Joseph D. Pauge
Title: Vice President
HELLER FINANCIAL, INC.
By: /s/ Dennis Graham
Title: Assistant Vice President
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