Exhibit 10(c)
CREDIT AGREEMENT
BETWEEN
THE INTERPUBLIC GROUP OF COMPANIES, INC.
AND
CHEMICAL BANK
____________________
US$10,000,000
____________________
Dated as of June 25, 1996
PAGE
TABLE OF CONTENTS
SECTION PAGE
SECTION 1
INTERPRETATIONS AND DEFINITIONS
1.1 Definitions 1
1.2 Accounting Terms and Determinations 7
SECTION 2
THE LOANS
2.1 Commitment 8
2.2 Method of Borrowing 8
2.3 The Note 10
2.4 Maturity of Loans 10
2.5 Interest Rates 10
2.6 Fees 14
2.7 Optional Termination or Reduction of Commitment 14
2.8 Mandatory Termination or Reduction of Commitment 14
2.9 Optional Prepayments 15
2.10 General Provisions as to Payments 15
2.11 Computation of Interest and Fees 15
2.12 Funding Losses 16
2.13 Extension of Commitment 16
2.14 Subsidiary Borrowers 16
SECTION 3
CONDITIONS OF LENDING
3.1 All Loans 18
3.2 Initial Loan 18
SECTION 4
CHANGE IN CIRCUMSTANCES AFFECTING LOANS
4.1 Basis for Determining Interest Rate Inadequate 20
4.2 Illegality 20
4.3 Increased Costs and Reduced Returns 20
SECTION 5
REPRESENTATIONS AND WARRANTIES
5.1 Corporate Existence and Power 23
5.2 Corporate and Governmental Authorization;
Contravention 23
5.3 Binding Effect 23
5.4 Financial Information 23
5.5 Litigation 24
5.6 Compliance with ERISA 24
5.7 Taxes 24
5.8 Subsidiaries 24
PAGE
SECTION PAGE
SECTION 6
COVENANTS
6.1 Information 25
6.2 Maintenance of Property; Insurance 27
6.3 Conduct of Business and Maintenance of Existence 27
6.4 Compliance with Laws 27
6.5 Inspection of Property, Books and Records 28
6.6 Cash Flow to Total Borrowed Funds 28
6.7 Total Borrowed Funds to Consolidated Net Worth 28
6.8 Minimum Consolidated Net Worth 28
6.9 Negative Pledge 29
6.10 Consolidations, Mergers and Sales of Assets 30
6.11 Use of Proceeds 30
SECTION 7
EVENTS OF DEFAULT
7.1 Events of Default 31
SECTION 8
MISCELLANEOUS
8.1 Notices 34
8.2 Amendments and Waivers; Cumulative Remedies 34
8.3 Successors and Assigns 34
8.4 Expenses; Documentary Taxes; Indemnification 35
8.5 Withholding Taxes 36
8.6 Counterparts 37
8.7 Headings; Table of Contents 37
8.8 Governing Law 37
PAGE
AGREEMENT dated as of June 25, 1996 between THE INTERPUBLIC GROUP
OF COMPANIES, INC., a Delaware corporation (the "Borrower"), and
CHEMICAL BANK (the "Bank").
SECTION I
INTERPRETATIONS AND DEFINITIONS
1.1 Definitions. The following terms, as used herein, shall
have the following respective meanings:
"Adjusted CD Rate" has the meaning set forth in Section
2.5(b) hereof.
"Adjusted London Interbank Offered Rate" has the
meaning set forth in Section 2.5(c) hereof.
"Applicable Lending Office" means, with respect to the
Bank, (i) in the case of Domestic Loans, its Domestic Lending
Office and (ii) in the case of Eurodollar Loans, its Eurodollar
Lending Office.
"Assessment Rate" has the meaning set forth in Section
2.5(b) hereof.
"Base Rate" means, for any day, a rate per annum equal
to the higher of (i) the rate established from time to time by
the Bank in the United States as its prime or reference rate of
interest, changes in which are to be effective from the opening
of business on the day such change is made and (ii) the sum of
(A) .5% plus (B) the overnight federal funds rate for such day as
published in the weekly statistical release designated by the
Board of Governors of the Federal Reserve System as "H.15(519)"
(or any successor publication thereto).
"Base Rate Loan" means a Loan which the Borrower
specifies pursuant to Section 2.2 hereof shall be a Base Rate
Loan.
"Benefit Arrangement" means, at any time, an employee
benefit plan within the meaning of Section 3(3) of ERISA which is
not a Plan or a Multiemployer Plan and which is maintained or
otherwise contributed to by any member of the ERISA Group.
"Cash Flow" means the sum of net income of the Borrower
and its Consolidated Subsidiaries (plus any amount by which net
income has been reduced by reason of the recognition of
post-retirement and post-employment benefit costs prior to the
period in which such benefits are paid), depreciation expenses,
amortization costs and changes in deferred taxes, provided that
such sum shall not be adjusted for any increase or decrease in
deferred taxes
PAGE
resulting from Quest & Associates, Inc., a Subsidiary of the
Borrower, investing in a portfolio of computer equipment leases
(it being understood that such increase or decrease in deferred
taxes relating to such investment shall not exceed $25,000,000).
"CD Base Rate" has the meaning set forth in Section
2.5(b) hereof.
"CD Loan" means a Loan which the Borrower specifies
pursuant to Section 2.2 hereof shall be a CD Loan.
"CD Margin" has the meaning set forth in Section 2.5(b)
hereof.
"Code" means the Internal Revenue Code of 1986, as
amended, and any successor statute thereto.
"Commitment" means the obligation of the Bank to lend
the amount set forth in Section 2.1 hereof, as such amount may be
reduced from time to time pursuant to Section 2.7 hereof.
"Consolidated Subsidiary" means at any date any
Subsidiary or other entity the accounts of which would be
consolidated with those of the Borrower in its consolidated
financial statements as of such date.
"Consolidated Net Worth" means at any date the
consolidated stockholders' equity of the Borrower and its
Consolidated Subsidiaries as such appear on the financial
statements of the Borrower determined in accordance with
generally accepted accounting principles (plus any amount by
which retained earnings has been reduced by reason of the
recognition of post-retirement and post-employment benefit costs
prior to the period in which such benefits are paid and without
taking into account the effect of cumulative currency translation
adjustments).
"Debt" of any Person means at any date, without
duplication, (i) all obligations of such Person for borrowed
money, including reimbursement obligations for letters of credit,
(ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all
obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in
the ordinary course of business, (iv) all obligations of such
Person as lessee under capital leases, (v) all Debt of others
secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person, and (vi) all Debt of others
Guaranteed by such Person, but in each case specified in (i)
through (vi) excludes obligations arising in connection with
securities repurchase transactions.
PAGE
"Default" means any condition or event which
constitutes an Event of Default or which with the giving of
notice or lapse of time, or both, would become an Event of
Default.
"Dollars" and the sign "$" mean lawful money of the
United States of America.
"Domestic Business Day" means any day except a
Saturday, Sunday or other day on which commercial banks in New
York, New York are authorized by law to close.
"Domestic Lending Office" means the principal office of
the Bank located at the address set forth on the signature pages
hereof for its Domestic Lending Office, or such other branch (or
affiliate) located within the United States as the Bank may
hereafter designated as its Domestic Lending Office.
"Domestic Loans" means CD Loans or Base Rate Loans or
both.
"Domestic Reserve Percentage" has the meaning set forth
in Section 2.5(b) hereof.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended.
"ERISA Group" means the Borrower and 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, are treated as a single employer
under Section 414(b) or (c) of the Code.
"Eurodollar Business Day" means any Domestic Business
Day on which commercial banks in London are open for
international business (including dealings in Dollar deposits).
"Eurodollar Lending Office" means the office of the
Bank located at the address set forth on the signature pages
hereof for its Eurodollar Lending Office, or such other branch
(or affiliate) of the Bank as it may hereafter designate as its
Eurodollar Lending Office.
"Eurodollar Loan" means a Loan which the Borrower
specifies pursuant to Section 2.2 hereof shall be a Eurodollar
Loan.
"Eurodollar Margin" has the meaning set forth in
Section 2.5(c) hereof.
"Eurodollar Reserve Percentage" has the meaning set
forth in Section 2.5(c) hereof.
PAGE
"Event of Default" has the meaning set forth in Section
7 hereof.
"Fixed CD Rate" has the meaning set forth in Section
2.5(b) hereof.
"Fixed Rate Loans" means CD Loans, Eurodollar Loans or
Money Market Rate Loans.
"Guarantee" by any Person means any obligation,
contingent or otherwise, of such Person directly or indirectly
guaranteeing any Debt or other obligation of any other Person
and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether
arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to
take-or-pay, to maintain financial statement conditions or
otherwise) or (ii) entered into for the purpose of assuring in
any other manner the obligee of such Debt or other obligation of
the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part), provided that the term
Guarantee shall not include endorsements for collection or
deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Interest Period" means: (1) with respect to each CD
Loan, at the Borrower's option, the period commencing on the date
of such Loan and ending 30, 60, 90 or 180 days thereafter, (2)
with respect to each Eurodollar Loan, at the Borrower's option,
the period commencing on the date of such Loan and ending one,
two, three or six months thereafter and (3) with respect to each
Base Rate Loan the period commencing on the date of such Loan and
ending 30 days thereafter provided, that:
(a) any Interest Period which would otherwise end on a
day which is not a Eurodollar Business Day shall be extended to
the next succeeding Eurodollar Business Day unless with respect
to a Eurodollar Loan such Eurodollar Business Day falls in
another calendar month, in which case such Interest Period shall
end on the next preceding Eurodollar Business Day;
(b) with respect to a Eurodollar Loan, any Interest
Period which begins on the last Eurodollar Business Day of the
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the
last Eurodollar Business Day of a calendar month; and
PAGE
(c) any Interest Period which would otherwise end
after the Termination Date shall end on the Termination Date;
provided further, however, that if any such Interest
Period shall be less than 30 days, the Loan for such Interest
Period shall be a Base Rate Loan.
"Lien" means, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or other encumbrance of
any kind in respect of such asset. For purposes of this
Agreement, the Borrower or any subsidiary shall be deemed to own
subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title
retention agreement relating to such asset.
"Loan" and "Loans" means a Domestic Loan, a Eurodollar
Loan, or a Money Market Rate Loan, as the context may require.
"London Interbank Offered Rate" has the meaning set
forth in Section 2.5(c) hereof.
"Material Plan" means at any time a Plan or Plans
having aggregate unfunded benefit liabilities (within the meaning
of Section 4001(a)(18) of ERISA) in excess of $25,000,000.
"Money Market Rate Loan" means a Loan made by the Bank
to the Borrower pursuant to Section 2.5(d) hereof.
"Multiemployer Plan" means at any time an employee
pension benefit plan that is a "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made
contributions, including for these purposes any Person which
ceased to be a member of the ERISA Group during such five year
period.
"Note" or "Notes" means the promissory note of the
Borrower, substantially in the form of Exhibits A and B hereto
evidencing the obligation of the Borrower to repay the Loans.
"PBGC" means the Pension Benefit Guaranty Corporation
or any entity succeeding to any or all of its functions under
ERISA.
"Participant" has the meaning set forth in Section 8.3.
"Person" means an individual, a corporation, a
partnership, an association, a business trust or any other entity
or organization, including a government or political subdivision
or an agency or instrumentality thereof.
PAGE
"Plan" means at any time a defined benefit pension plan
(other than a Multiemployer Plan) which is covered by Title IV of
ERISA or subject to the minimum funding standards under Section
412 of the Code and either (i) is maintained, or contributed to,
by any member of the ERISA Group for employees of any member of
the ERISA Group or (ii) has at any time within the preceding five
years been maintained, or contributed to, by any Person which was
at such time a member of the ERISA Group for employees of any
Person which was at such time a member of the ERISA Group.
"Regulation U" means Regulation U of the Board of
Governors of the Federal Reserve System, as in effect from time
to time.
"Significant Subsidiary" or "Significant Group of
Subsidiaries" at any time of determination means any Consolidated
Subsidiary or group of Consolidated Subsidiaries, respectively,
which, individually or in the aggregate, together with its or
their subsidiaries, accounts or account for more than 10% of the
consolidated gross revenues of the Borrower and its Consolidated
Subsidiaries for the most recently ended fiscal year or for more
than 10% of the total assets of the Borrower and its Consolidated
Subsidiaries as of the end of such fiscal year; provided that in
connection with any determination with respect to a Significant
Group of Subsidiaries under (x) Section 7(f), there shall be a
payment default, failure or other event (of the type described
therein but without regard to the principal amount of such
obligation) of each Consolidated Subsidiary included in such
group, (y) Sections 7(g) and (h) and the last sentence of Section
6.10, the condition or event described therein shall exist with
respect to each Consolidated Subsidiary included in such group or
(z) Section 7(j), there shall be a final judgment (of the type
specified therein but without regard to the amount of such
judgment) rendered against each Consolidated Subsidiary included
in such group.
"Subsidiary" means any corporation or other entity of
which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or
other persons performing similar functions is at the time
directly or indirectly owned by the Borrower.
"Termination Date" means June 30, 1999 or such later
date to which the Commitment is extended in accordance with
Section 2.13 hereof.
"Total Borrowed Funds" means at any date, without
duplication, (i) all outstanding obligations of the Borrower and
its Consolidated Subsidiaries for borrowed money, (ii) all
outstanding obligations of the Borrower and its Consolidated
Subsidiaries evidenced by bonds, debentures, notes or similar
PAGE
instruments and (iii) any outstanding obligations of the type set
forth in (i) or (ii) of any other Person Guaranteed by the
Borrower and its Consolidated Subsidiaries, it being understood
that the obligation to repurchase securities transferred pursuant
to a securities repurchase agreement shall not be deemed to give
rise to any amount of Total Borrowed Funds pursuant to this
definition.
1.2 Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein
shall be interpreted, all accounting determinations hereunder
shall be made, and all financial statements required to be
delivered hereunder shall be prepared, in accordance with
generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes
concurred in by the Borrower's independent public accountants)
with the most recent audited consolidated financial statements of
the Borrower and its Consolidated Subsidiaries delivered to the
Bank.
SECTION 2
THE LOANS
2.1 Commitment. At any time prior to the Termination
Date the Bank agrees, on the terms and conditions set forth in
this Agreement, to lend to the Borrower from time to time amounts
not exceeding in the aggregate at any one time outstanding the
principal amount of $10,000,000 minus the value of any
outstanding letter(s) of credit issued by the Bank on behalf of
DraftDirect Worldwide, Inc. (the "Commitment"). Each Loan under
this Section 2.1 shall be in the principal amount of $250,000
(except that any such Loan may be in the amount of the unused
Commitment) or any larger multiple thereof. During such period
and within the foregoing limits, the Borrower may borrow under
this Section 2.1, repay or to the extent permitted by Section 2.9
hereof prepay Loans and reborrow under this Section 2.1.
2.2 Method of Borrowing.
(a) With respect to each Loan made pursuant to Section
2.1 hereof, the Borrower shall give the Bank notice prior to
11:00 a.m. on the drawdown date in the case of a Base Rate
Loan, at least one Domestic Business Day's notice in the
case of a CD Loan, or at least three Eurodollar Business
Days' notice in the case of a Eurodollar Loan, specifying:
(i) the date of such Loan, which shall be a Domestic
Business Day in the case of a Domestic Loan and a
Eurodollar Business Day in the case of a Eurodollar
Loan;
(ii) the principal amount of such Loan;
(iii) whether the Loan is to be a Base Rate Loan, a
CD Loan or a Eurodollar Loan (and, if such Loan is to
be a Eurodollar Loan, whether Section 2.14 is to be
applicable thereto); and
(iv) in the case of a Fixed Rate Loan, the duration of
the Interest Period applicable thereto, subject to the
definition of Interest Period.
(b) On the date of each Loan the Bank will make the
proceeds thereof available to the Borrower at the Domestic
Lending Office.
(c) If the Bank makes a new Loan hereunder on a day
which the Borrower is to repay all or any part of an
outstanding Loan, the Bank shall apply the proceeds of its
new Loan to make such repayment and only an amount equal to
the difference (if any) between the amount being borrowed
and the amount being repaid shall be made available by the
Bank to the Borrower as provided in subsection (b) of this
Section or remitted by the Borrower to the Bank as provided
in Section 2.10 hereof, as the case may be.
PAGE
2.3 The Note.
(a) The Loans shall be evidenced by a single Note
payable to the order of the Bank for the account of its
Applicable Lending Office in an amount equal to the
aggregate unpaid principal amount of the Loans. The Money
Market Rate Loans shall be evidenced by the Money Market
Rate Note, a form of which is attached hereto as Exhibit B.
(b) The Bank shall record and prior to any transfer,
if permitted, of its Note, shall endorse on the schedule
forming a part thereof appropriate notations evidencing the
date, the type, the amount and the maturity of each Loan to
be evidenced by the Note and the date and amount of each
payment of principal made by the Borrower with respect
thereto; provided that the failure of the Bank to make any
such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Note and,
further provided, the Bank shall make such additions and
deletions as the Borrower may request in order to correct
any mistakes. The Bank is hereby irrevocably authorized by
the Borrower so to endorse the Note and to attach to and
make a part of the Note a continuation of any such schedule
as and when required.
2.4 Maturity of Loans. Each Loan shall mature, and
the principal amount thereof shall be due and payable, on
the last day of the Interest Period applicable to such Loan.
Each Money Market Rate Loan shall mature at such time as may
be agreed to by the Bank and the Borrower.
2.5 Interest Rates.
(a) Each Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per
annum equal to the Base Rate. Such interest shall be
payable for each Interest Period on the last day thereof.
Any overdue principal of and, to the extent permitted by
law, overdue interest on the Base Rate Loans shall bear
interest during such overdue period for each day until paid
at a rate per annum equal to the sum of 1% plus the
otherwise applicable rate for such day, payable on demand of
the Bank.
(b) Each CD Loan shall bear interest on the
outstanding principal amount thereof, for each Interest
Period applicable thereto, at a rate per annum equal to the
applicable Fixed CD Rate; provided that if any CD Loan or
any portion thereof shall, as a result of clause (c) of the
definition of Interest Period, have an Interest Period of
PAGE
less than 30 days, such portion shall bear interest during
such Interest Period at the rate applicable to Base Rate
Loans during such Period. Such interest shall be payable for
each Interest Period on the last day thereof and, if such
Interest Period is longer than 90 days, at intervals of 90
days after the first day thereof. Any overdue principal of
and, to the extent permitted by law, overdue interest on the
CD Loans shall bear interest during such overdue period for
each day until paid at a rate per annum equal to the sum of
1% plus the higher of (i) the Fixed CD Rate applicable to
such Loan and (ii) the rate applicable to Base Rate Loans
for such day, payable on demand of the Bank.
The "Fixed CD Rate" applicable to any CD Loan for any
Interest Period means a rate per annum equal to the sum of the CD
Margin plus the applicable Adjusted CD Rate.
The "CD Margin" means (i) .4250%, if at the end of each of
the two most recently completed fiscal quarters the Borrower's
ratio of Total Borrowed Funds to Consolidated Net Worth was equal
to or less than .40 to 1 and the Borrower's ratio to Cash Flow to
Total Borrowed Funds was equal to or greater than .50 to 1; or
(ii) .5250%, if (a) the conditions of clause (i) have not been
satisfied and (b) at the end of each of the two most recently
completed fiscal quarters the Borrower's ratio of Total Borrowed
Funds to Consolidated Net Worth was equal to or less than .70 to
1 and the Borrower's ratio of Cash Flow to Total Borrowed Funds
was equal to or greater than .35 to 1; or (iii) .6250%, if the
conditions set forth in both clauses (i) and (ii) are not
satisfied.
The "Adjusted CD Rate" applicable to any Interest Period
means a rate per annum determined pursuant to the following
formula:
ACDR = CDBR A + AR
1 - DRP
ACDR = Adjusted CD Rate for such Interest Period
CDBR = CD Base Rate for such Interest Period
AR = Assessment Rate
DRP = Domestic Reserve Percentage
The "CD Base Rate" means for any Interest Period the prevailing
per annum rate of interest as reasonably determined by the Bank
(rounded upward, if necessary, to the next higher 1/100 of 1%)
bid at 11:00 a.m. (New York time) (or as soon thereafter as
practicable) on the first day of such Interest Period by two
PAGE
or more certificate of deposit dealers of recognized standing
selected by the Bank for the purchase at face value of US dollar
certificates of deposit issued by major New York banks in an
amount comparable to the principal amount of the CD Loan to which
such Interest Period applies and with a maturity comparable to
such Interest Period.
The "Domestic Reserve Percentage" means for any day, that
percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any basic,
supplemental or emergency reserves) for a member bank of the
Federal Reserve System with deposits exceeding five billion
Dollars in respect of new non-personal time deposits in Dollars
having a maturity comparable to the related Interest Period and
in an amount of $100,000 or more. The Fixed CD Rate shall be
adjusted automatically on and as of the effective date of any
change in the Domestic Reserve Percentage.
"Assessment Rate" means for any Interest Period the net
annual assessment rate (rounded upwards, if necessary, to the
next higher 1/100 of 1%) actually incurred by the Bank to the
Federal Deposit Insurance Corporation (or any successor) for such
Corporation's (or such successor's) insuring time deposits at
offices of the Bank in the United States during the most recent
period for which such rate has been determined prior to the
commencement of such Interest Period.
(c) Each Eurodollar Loan shall bear interest on the unpaid
principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Eurodollar
Margin plus the applicable Adjusted London Interbank Offered
Rate. Such interest shall be payable for each Interest Period on
the last day thereof and, if such Interest Period is longer than
three months, at intervals of three months after the first day
thereof. Any overdue principal of and, to the extent permitted
by law, overdue interest on the Eurodollar Loans shall bear
interest for each day until paid at a rate per annum equal to the
sum of 1% plus the higher of (i) the rate of interest applicable
to such Loan and (ii) the rate applicable to Base Rate Loans for
such day, payable on demand of the Bank.
The "Adjusted London Interbank Offered Rate" applicable to
any Interest Period means a rate per annum equal to the quotient
obtained (rounded upwards, if necessary, to the next higher 1/100
of 1%) by dividing (i) the applicable London Interbank Offered
Rate by 1.00 minus the Eurodollar Reserve Percentage.
PAGE
The "London Interbank Offered Rate" applicable to any
Interest Period means the rate per annum at which deposits in
Dollars are offered to the Bank in the London interbank market at
approximately 11:00 a.m. (London time) two Eurodollar Business
Days prior to the first day of such Interest Period in an amount
approximately equal to the principal amount of the Eurodollar
Loan to which such Interest Period is to apply and for a period
of time comparable to such Interest Period.
The "Eurodollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement for a member bank of the Federal Reserve
System with deposits exceeding five billion dollars in respect of
"Eurocurrency liabilities" (or in respect of any other category
of liabilities which includes deposits by reference to which the
interest rate on Eurodollar Loans is determined or any category
of extensions of credit or other assets which includes loans by a
non-United States office of the Bank to United States residents).
The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in
the Eurodollar Reserve Percentage.
The "Eurodollar Margin" means (i) .30%, if at the end of
each of the two most recently completed fiscal quarters the
Borrower's ratio of Total Borrowed Funds to Consolidated Net
Worth was equal to or less than .40 to 1 and the Borrower's ratio
of Cash Flow to Total Borrowed Funds was equal to or greater than
.50 to 1; or (ii) .40%, if (a) the conditions of clause (i) have
not been satisfied and (b) at the end of each of the two most
recently completed fiscal quarters the Borrower's ratio of Total
Borrowed Funds to Consolidated Net Worth was equal to or less
than .70 to 1 and the Borrower's ratio of Cash Flow to Total
Borrowed Funds was equal to or greater than .35 to 1; or (iii)
.50%, if the conditions set forth in both clauses (i) and (ii)
are not satisfied.
(d) Each Money Market Rate Loan shall be made by the Bank
to the Borrower upon such terms and conditions and in such
amounts as may be agreed upon from time to time by the Bank and
the Borrower. Each Money Market Rate Loan shall be evidenced by
a Note in the form of Exhibit B hereto.
2.6 Fees. The Borrower shall pay to the Bank a commitment
fee computed on the unused portion of the Commitment. The per
annum commitment fee shall be on any date from and after the date
hereof (i) .125% of the unused portion of the Commitment, if at
the end of each of the two most recently completed fiscal
quarters the Borrower's ratio of Total Borrowed Funds to
Consolidated Net Worth was equal to or less than .40 to 1 and the
PAGE
Borrower's ratio of Cash Flow to Total Borrowed Funds was equal
to or greater than .50 to 1; or (ii) .15% of the unused portion
of the Commitment, if (a) the conditions of clause (i) have not
been satisfied and (b) at the end of each of the two most
recently completed fiscal quarters the Borrower's ratio of Total
Borrowed Funds to Consolidated Net Worth was equal to or less
than .70 to 1 and the Borrower's ratio of Cash Flow to Total
Borrowed Funds was equal to or greater than .35 to 1; or (iii)
.180% of the unused portion of the Commitment, if the conditions
set forth in clauses (i) and (ii) are not satisfied. Such fees
shall accrue from the date hereof to and including the
Termination Date and shall be payable quarterly in arrears on the
last day of each June, September, December and March and on any
date on which the Commitment is terminated or otherwise reduced.
2.7 Optional Termination or Reduction of Commitment. The
Borrower may, upon at least three Domestic Business Days' notice
to the Bank, terminate at any time or reduce from time to time
the unused portion of the Commitment. Any such reduction of the
Commitment shall be in the amount of $1,000,000 or any larger
multiple thereof. If the Commitment is terminated in its
entirety, the accrued commitment fee shall be payable on the
effective date of such termination.
2.8 Mandatory Termination or Reduction of Commitment. If
not previously terminated by the Borrower pursuant to Section
2.7, the Commitment shall terminate on the Termination Date, and
any Loans then outstanding (together with accrued interest
thereon) shall be due and payable on such date.
2.9 Optional Prepayments.
(a) The Borrower may, upon at least one Domestic
Business Day's notice to the Bank, prepay the Base Rate
Loans without premium or penalty in whole at any time or
from time to time in part in an amount equal to $250,000 or
any multiple of $250,000 in excess thereof (or such lesser
amount as applicable if less than $250,000 is outstanding)
by paying the principal amount being prepaid together with
accrued interest thereon to the date of prepayment.
(b) Except as provided in Section 4.2 hereof, the
Borrower may not prepay all or any portion of the principal
amount of any Fixed Rate Loan prior to the maturity thereof.
2.10 General Provisions as to Payments. The Borrower
shall make each payment of principal of, and interest on, the
Loans and of commitment fees hereunder not later than 11:00 a.m.
(local time) on the date when due in funds immediately available
at the Applicable Lending Office for
PAGE
the account of (i) the Domestic Lending Office in the case of
Domestic Loans and Money Market Rate Loans or (ii) the Eurodollar
Lending Office in the case of Eurodollar Loans. Whenever any
payment of principal of, or interest on, the Domestic Loans, the
Money Market Rate Loans, the commitment fee shall be due on a day
which is not a Domestic Business Day, the date for payment
thereof shall be extended to the next succeeding Domestic
Business Day. Whenever any payment of principal of, or interest
on, the Eurodollar Loans shall be due on a day which is not a
Eurodollar Business Day, the date for payment thereof shall be
extended to the next succeeding Eurodollar Business Day unless as
a result thereof it would fall in the next calendar month, in
which case it shall be advanced to the next preceding Eurodollar
Business Day. If the date for any payment of principal is
extended by operation of law or otherwise, interest shall be
payable for such extended time.
2.11 Computation of Interest and Fees. Interest on
the Loans bearing interest based on clause (i) of the definition
of Base Rate shall be computed on the basis of a year of 365 or
366 days, as the case may be, and paid for actual days elapsed.
Interest on Loans bearing interest based on clause (ii) of the
definition of Base Rate, the CD Loans, the Eurodollar Loans, the
Money Market Rate Loans and the calculation of the commitment fee
shall be computed on the basis of a year of 360 days and paid for
actual days elapsed.
2.12 Funding Losses. If the Borrower makes any
payment of principal with respect to any Fixed Rate Loan
(pursuant to Section 4 or Section 7 or otherwise) on any day
other than the last day of an Interest Period applicable to such
Loan, or if the Borrower fails to borrow any Fixed Rate Loan
after notice has been given to the Bank in accordance with
Section 2.2 hereof, the Borrower shall reimburse the Bank on
demand for any resulting loss or expense incurred by it (or by
any existing or prospective Participant in the related Loan)
including (without limitation) any loss incurred in obtaining,
liquidating or employing deposits from third parties; provided
that the Bank shall have delivered to the Borrower a certificate
by a Bank officer as to the amount of such loss.
2.13 Extension of Commitment. Not more than 60 nor
less than 45 days prior to each date which is either the second
or third anniversary of this Agreement, the Borrower may request
in writing that the Bank extend the Commitment for an additional
period of one year from the then current Termination Date. If
the Bank, in its sole discretion, decides to grant such request,
it shall so notify the Borrower not less than 30 days before the
then current Termination Date in writing, whereupon the
Commitment shall be extended for an additional period of one year
from the then current Termination Date, and the term "Termination
PAGE
Date" shall thereafter refer to the date that the Commitment, as
so extended, will terminate. If not extended as provided in this
Section 2.13, the Commitment will automatically terminate on the
then current Termination Date without further action by the
Borrower or the Bank.
2.14 Subsidiary Borrowers.
(a) Designation of Subsidiary Borrower. Any notice of a
borrowing pursuant to Section 2.2(a) may include, at the option
of the Borrower, a designation that (i) the terms and provisions
of this Section 2.14 shall be applicable to such Loan, and (ii)
DraftDirect Worldwide, Inc. shall be the borrower with respect to
such Loan. Any Loan as to which such a designation is made is
referred to herein as a "Subsidiary Loan" and DraftDirect
Worldwide, Inc., is referred to herein as the "Subsidiary
Borrower". Except to the extent inconsistent with any term or
provision of this Section 2.14, the terms and provisions of this
Agreement shall apply to each Subsidiary Loan (and to each
promissory note evidencing a Subsidiary Loan) to the same extent
as applicable to any other Loan (and any Note).
(b) Funding and Notes; Commitment. On the date of each
Subsidiary Loan, the Bank will make the proceeds thereof
available to the Subsidiary Borrower at the Applicable Lending
Office. Each Subsidiary Loan shall be evidenced by a separate
promissory note of the Subsidiary Borrower, substantially in the
form of Exhibit C hereto, payable to the order of the Bank for
the account of its Applicable Lending Office ("Subsidiary Note").
For purposes of computing the amount from time to time of the
unused Commitment, the outstanding principal amount of all
Subsidiary Loans at any time shall be deemed to constitute
outstanding Loans of like principal amount under this Agreement.
(c) Payments, Prepayments, Funding Losses, Etc. The terms
and provisions of Sections 2.9, 2.10, 2.12, 4 and 8.3 of this
Agreement are intended to be applicable to Subsidiary Loans (and
the Subsidiary Notes), provided that references to the Borrower's
rights and obligations therein (including rights and obligations
in respect of notices) shall, in the case of any Subsidiary Loan,
be deemed to be references to the Subsidiary Borrower's rights
and obligations. Except as provided in the preceding sentence,
all references to the "Borrower" in this Agreement shall be
deemed to be references to The Interpublic Group of Companies,
Inc. So long as DraftDirect Worldwide, Inc. is a Subsidiary
Borrower under the Agreement, such fees as described in Section
1.6 shall be paid by DraftDirect Worldwide, Inc.
(d) Conditions to Subsidiary Loans. In addition to the
conditions set forth in Section 3, the obligation of the Bank to
make the initial Subsidiary Loan to any Subsidiary Borrower shall
be subject to the receipt by the Bank of the following:
PAGE
(i) a duly executed Subsidiary Note of such Subsidiary
Borrower, with the duly executed guaranty of
Borrower affixed thereto; and
(ii) an opinion of counsel to such Subsidiary Borrower
to the effect that (A) such Subsidiary Borrower is
a corporation duly organized, validly existing and
in good standing under the laws of its
jurisdiction of incorporation, (B) the execution,
delivery and performance by such Subsidiary
Borrower of the Subsidiary Note are within the
Subsidiary Borrower's corporate powers and have
been duly authorized by all necessary corporate
action, and (C) the Subsidiary Note of such
Subsidiary Borrower constitutes a valid and
binding obligation of the Subsidiary Borrower.
Each borrowing by a Subsidiary Borrower shall be deemed to be a
representation and warranty by the Borrower on the date of such
Subsidiary Loan as to the matters specified in clause (ii)(A),
(ii)(B) and (ii) (C) above
(e) Notices. Notices, requests, demands or communications
to any Subsidiary Borrower shall be delivered or addressed to the
Borrower as provided in Section 8.1(a).
PAGE
SECTION 3
CONDITIONS OF LENDING
The obligation of the Bank to make each Loan hereunder is subject
to the performance by the Borrower of all its obligations under
this Agreement and to the satisfaction of the following further
conditions:
3.1 All Loans. In the case of each Loan hereunder,
including the initial Loan:
(a) receipt by the Bank of the notice from the
Borrower required by Section 2.2 hereof;
(b) the fact that immediately after the making of the
Loan no Default with respect to Sections 6.1(d), 6.6, 6.7,
6.8, 6.9 or 6.10 or Event of Default shall have occurred and
be continuing, except that in the case of any Loan which,
after the application of proceeds thereof, results in no net
increase in the outstanding principal amount of Loans made
by the Bank, the fact that immediately after the making of
the Loan, no Event of Default shall have occurred and be
continuing;
(c) the fact that the representations and warranties
contained in this Agreement shall be true on and as of the
date of the Loan (except, in the case of any Loan which,
after the application of the proceeds thereof, results in no
net increase in the outstanding principal amount of Loans
made by the Bank, the representations and warranties set
forth in Sections 5.4(B) and 5.5 so long as the Borrower has
disclosed to the Bank any matter which would cause any such
representation to be untrue on the date of such Loan); and
(d) receipt by the Bank of such other documents,
evidence, materials and information with respect to the
matters contemplated hereby as the Bank may reasonably
request.
Each borrowing hereunder shall be deemed to be a
representation and warranty by the Borrower on the date of such
Loan as to the facts specified in (b) and (c) of this Section.
3.2 Initial Loan. In the case of the initial Loan:
(a) receipt by the Bank of a duly executed Note;
(b) receipt by the Bank of an opinion of counsel to
the Borrower as to the matters referred to in Sections 5.1, 5.2,
5.3, 5.5 and 5.8 hereof, and covering such other matters as the
Bank may reasonably request, dated the date
PAGE
of such Loan, satisfactory in form and substance to the Bank;
(c) receipt by the Bank of certified copies of all
corporate action taken by the Borrower to authorize the
execution, delivery and performance of this Agreement and the
Note, and the Loans hereunder and such other corporate documents
and other papers as the Bank may reasonably request;
(d) receipt by the Bank of a certificate of a duly
authorized officer of the Borrower as to the incumbency, and
setting forth a specimen signature, of each of the persons (i)
who has signed this Agreement on behalf of the Borrower; (ii) who
will sign the Note on behalf of the Borrower; and (iii) who will,
until replaced by other persons duly authorized for that purpose,
act as the representatives of the Borrower for the purpose of
signing documents in connection with this Agreement and the
transactions contemplated hereby; and
(e) receipt by the Bank of a certificate of a duly
authorized officer of the Borrower to the effect set forth in
Sections 3.1(b) and 3.1(c) hereof.
PAGE
SECTION 4
CHANGE IN CIRCUMSTANCES AFFECTING LOANS
4.1 Basis for Determining Interest Rate Inadequate.
If on or prior to the first day of any Interest Period deposits
in Dollars (in the applicable amounts) are not being offered to
the Bank in the relevant market for such Interest Period, the
Bank shall forthwith give notice thereof to the Borrower,
whereupon the obligations of the Bank to make CD Loans or
Eurodollar Loans, as the case may be, shall be suspended until
the Bank notifies the Borrower that the circumstances giving rise
to such suspension no longer exist. Unless the Borrower notifies
the Bank at least two Domestic Business Days before the date of
any Fixed Rate Loan for which a notice of borrowing has
previously been given that it elects not to borrow on such date,
such Loan shall instead be made as a Base Rate Loan or the notice
of borrowing may be withdrawn.
4.2 Illegality. If, after the date of this Agreement,
the adoption of any applicable law, rule or regulation, or any
change therein, or any change in the interpretation or
administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Bank (or its
Eurodollar Lending Office) with any request or directive (whether
or not having the force of law) of any such authority, central
bank or comparable agency shall make it unlawful or impossible
for the Bank (or its Eurodollar Lending Office) to make, maintain
or fund its Eurodollar Loans, the Bank shall forthwith so notify
the Borrower, whereupon the Bank's obligation to make Eurodollar
Loans shall be suspended. Before giving any notice to the
Borrower pursuant to this Section 4.2, the Bank will designate a
different Eurodollar Lending Office if such designation will
avoid the need for giving such notice and will not, in the
judgment of the Bank, be otherwise disadvantageous to the Bank.
If the Bank shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Eurodollar Loans to
maturity and shall so specify in such notice, the Borrower shall
immediately prepay in full the then outstanding principal amount
of each such Eurodollar Loan, together with accrued interest
thereon.
4.3 Increased Costs and Reduced Returns.
(a) If, after the date hereof, the adoption of any
applicable law, rule or regulation, or any change therein, or any
change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof or compliance
by the Bank (or its Applicable Lending Office) with any request
or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency:
PAGE
(i) shall subject the Bank (or its Applicable Lending
Office) to any tax, duty or other charge with respect to its
obligation to make Fixed Rate Loans, its Fixed Rate Loans,
or its Note, or shall change the basis of taxation of
payments to the Bank (or its Applicable Lending Office) of
the principal of or interest on its Fixed Rate Loans or in
respect of any other amounts due under this Agreement, in
respect of its Fixed Rate Loans or its obligation to make
Fixed Rate Loans, (except for changes in the rate of tax on
the overall net income of the Bank or its Applicable Lending
Office imposed by the jurisdiction in which the Bank's
principal executive office or Applicable Lending Office is
located); or
(ii) shall impose, modify or deem applicable any
reserve, special deposit or similar requirement (including,
without limitation, any imposed by the Board of Governors of
the Federal Reserve System, but excluding (A) with respect
to any CD Loan any such requirement included in an
applicable Domestic Reserve Percentage and (B) with respect
to any Eurodollar Loan any such requirement included in an
applicable Eurodollar Reserve Percentage) against assets of,
deposits with or for the account of, or credit extended by,
the Bank (or its Applicable Lending Office) or shall impose
on the Bank (or its Applicable Lending Office) or on the
United States market for certificates of deposit or the
London interbank market any other condition affecting its
obligation to make Fixed Rate Loans, its Fixed Rate Loans or
its Note;
and the result of any of the foregoing is to increase the cost to
the Bank (or its Applicable Lending Office) of making or
maintaining any Fixed Rate Loan, or to reduce the amount of any
sum received or receivable by the Bank (or its Applicable Lending
Office) under this Agreement or under its Note with respect
thereto, by an amount deemed by the Bank to be material, then,
within 15 days after demand by the Bank, the Borrower agrees to
pay to the Bank such additional amount or amounts as will
compensate the Bank for such increased cost or reduction.
(b) If the Bank shall have determined that the adoption,
after the date hereof, of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance
by the Bank (or its Applicable Lending Office) 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
PAGE
rate of return on the Bank's capital as a consequence of its
obligations hereunder to a level below that which the Bank could
have achieved but for such adoption, change or compliance (taking
into consideration the Bank's policies with respect to capital
adequacy) by an amount deemed by the Bank to be material, then
from time to time, within 15 days after demand by the Bank, the
Borrower shall pay to such Bank such additional amount or amounts
as will compensate the Bank for such reduction.
(c) The Bank will promptly notify the Borrower of any event
of which it has knowledge, occurring after the date hereof, which
will entitle the Bank to compensation pursuant to this Section
and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the judgment of the Bank, be
otherwise disadvantageous to the Bank. A certificate by an
officer of the Bank claiming compensation under this Section and
setting forth the additional amount or amounts to be paid to it
hereunder shall, in the absence of manifest error, constitute
prima facie evidence of such amount. In determining such amount,
the Bank may use any reasonable averaging and attribution
methods.
PAGE
SECTION 5
REPRESENTATIONS AND WARRANTIES
The Borrower hereby represents and warrants to the Bank
that:
5.1 Corporate Existence and Power. The Borrower is a
corporation duly organized, validly existing and in good standing
under the laws of the State of its incorporation, and has all
corporate powers and all material governmental licenses,
authorizations, consents and approvals required to carry on its
business as now conducted.
5.2 Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the
Borrower of this Agreement and the Note are within the Borrower's
corporate powers, have been duly authorized by all necessary
corporate action, require no action by or in respect of, or
filing with, any governmental body, agency or official and do not
contravene, or constitute a default under, any provision of
applicable law or regulation or of the certificate of
incorporation or by-laws of the Borrower or of any judgment,
injunction, order, decree, material agreement or other instrument
binding upon the Borrower or result in the creation or imposition
of any Lien on any asset of the Borrower or any of its
Consolidated Subsidiaries.
5.3 Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower and the Notes, when
executed and delivered in accordance with this Agreement, will
constitute a valid and binding obligation of the Borrower.
5.4 Financial Information.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as at December 31, 1995 and the related
consolidated statements of income and retained earnings and cash
flows of the Borrower and its Consolidated Subsidiaries for the
fiscal year then ended, certified by Price Waterhouse, certified
public accountants, and set forth in the Borrower's most recent
Annual Report on Form 10-K, a copy of which has been delivered to
the Bank, fairly present in conformity with generally accepted
accounting principles, the consolidated financial position of the
Borrower and its Consolidated Subsidiaries at such date and the
consolidated results of operations for such fiscal year;
(b) Since December 31, 1995 there has been no material
adverse change in the business, financial position or results of
operations of the Borrower and its Consolidated Subsidiaries,
considered as a whole.
PAGE
5.5 Litigation. There is no action, suit or
proceeding pending against, or to the knowledge of the Borrower
threatened against, the Borrower or any of its Consolidated
Subsidiaries before any court or arbitrator or any governmental
body, agency or official in which there is a significant
probability of an adverse decision which would materially
adversely affect the business, consolidated financial position or
consolidated results of operations of the Borrower and its
Consolidated Subsidiaries taken as a whole or which in any manner
draws into question the validity of this Agreement or the Notes.
5.6 Compliance with ERISA. Each member of the ERISA
Group has fulfilled its obligations under the minimum funding
standards of ERISA and the Code with respect to each Plan and is
in compliance in all material respects with the presently
applicable provisions of ERISA and the Code except where the
failure to comply would not have a material adverse effect on the
Borrower and its Consolidated Subsidiaries taken as a whole. No
member of the ERISA Group has incurred any unsatisfied material
liability to the PBGC or a Plan under Title IV of ERISA other
than a liability to the PBGC for premiums under Section 4007 of
ERISA.
5.7 Taxes. United States Federal income tax returns
of the Borrower and its Consolidated Subsidiaries have been
examined and closed through the fiscal year ended December 31,
1987. The Borrower and its Consolidated Subsidiaries have filed
all United States Federal income tax returns and all other
material tax returns which are required to be filed by them and
have paid all taxes due reported on such returns or pursuant to
any assessment received by the Borrower or any Consolidated
Subsidiary, to the extent that such assessment has become due.
The charges, accruals and reserves on the books of the Borrower
and its Consolidated Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of the Borrower,
adequate except for those which are being contested in good faith
by the Borrower.
5.8 Subsidiaries. Each of the Borrower's Consolidated
Subsidiaries is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of
incorporation, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted, all to the
extent material to the Borrower and its Subsidiaries taken as a
whole.
PAGE
SECTION 6
COVENANTS
So long as the Commitment shall be in effect or the Note is
outstanding, the Borrower agrees that:
6.1 Information. The Borrower will deliver to the Bank:
(a) as soon as available and in any event within 95 days
after the end of each fiscal year of the Borrower, a consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as
at the end of such year, and consolidated statements of income and
retained earnings and statement of cash flows of the Borrower and
its Consolidated Subsidiaries for such year, setting forth in each
case in comparative form the figures for the preceding fiscal year,
all reported on by Price Waterhouse or other independent certified
public accountants of nationally recognized standing;
(b) as soon as available and in any event within 50 days
after the end of each of the first three quarters of each fiscal
year of the Borrower, an unaudited consolidated balance sheet of
the Borrower and its Consolidated Subsidiaries as at the end of
such quarter and the related unaudited consolidated statements of
income and retained earnings and statement of cash flows of the
Borrower and its Consolidated Subsidiaries for such quarter and for
the portion of the Borrower's fiscal year ended at the end of such
quarter setting forth in each case in comparative form the figures
for the corresponding quarter and the corresponding portion of the
Borrower's previous fiscal year, all certified (subject to changes
resulting from year-end adjustments) as to fairness of
presentation, in conformity with generally accepted accounting
principles (other than as to footnotes) and consistency (except to
the extent of any changes described therein and permitted by
generally accepted accounting principles) by the chief financial
officer or the chief accounting officer of the Borrower;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate
of the chief financial officer or the chief accounting officer of
the Borrower (i) setting forth in reasonable detail the
calculations required to establish whether the Borrower was in
compliance with the requirements of Sections 6.6 to 6.8, inclusive,
on the date of such financial statements and (ii) stating whether
any Default has occurred and is continuing on the date of such
certificate and, if any Default then has occurred and is
continuing, setting forth the details thereof and the action which
the Borrower is taking or proposes to take with respect thereto;
PAGE
(d) within 10 days of the chief executive officer, chief
operating officer, principal financial officer or principal
accounting officer of the Borrower obtaining knowledge of any event
or circumstance known by such person to constitute a Default, if
such Default is then continuing, a certificate of the principal
financial officer or the principal accounting officer of the
Borrower setting forth the details thereof and within five days
thereafter, a certificate of either of such officers setting forth
the action which the Borrower is taking or proposes to take with
respect thereto;
(e) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports
and proxy statements so mailed;
(f) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and annual,
quarterly or monthly reports which the Borrower shall have filed
with the Securities and Exchange Commission;
(g) if and when the chief executive officer, chief operating
officer, principal financial officer or principal accounting
officer of the Borrower obtains knowledge that any member of the
ERISA Group (i) has given or is required to give notice to the PBGC
of any "reportable event" (as defined in Section 4043 of ERISA)
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, a copy of the notice of such
reportable event given or required to be given to the PBGC; (ii)
has received notice of complete or partial withdrawal liability
under Title IV of ERISA or notice that any Multiemployer Plan is in
reorganization, is insolvent or has been terminated, a copy of such
notice; or (iii) has received notice from the PBGC under Title IV
of ERISA of an intent to terminate, impose liability (other than
for premiums under Section 4007 of ERISA) in respect of, or appoint
a trustee to administer any Plan, a copy of such notice;
(h) if at any time the value of all "margin stock" (as
defined in Regulation U) owned by the Borrower and its Consolidated
Subsidiaries exceeds (or would, following application of the
proceeds of an intended Loan hereunder, exceed) 25% of the value of
the total assets of the Borrower and its Consolidated Subsidiaries,
in each case as reasonably determined by the Borrower, prompt
notice of such fact; and
(i) from time to time such additional information regarding
the financial position or business of the Borrower as the Bank may
reasonably request; provided, however, that the
PAGE
Borrower shall be deemed to have satisfied its obligations under
clauses (a) and (b) above if and to the extent that the Borrower
has provided to the Bank pursuant to clause (f) the periodic
reports on Forms 10-Q and 10-K required to be filed by the Borrower
with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934, as amended, for the quarterly and
annual periods described in such clauses (a) and (b).
6.2 Maintenance of Property; Insurance.
(a) The Borrower will maintain or cause to be maintained in
good repair, working order and condition all properties used and
useful in the business of the Borrower and each Consolidated
Subsidiary and from time to time will make or cause to be made all
appropriate repairs, renewals and replacement thereof, except where
the failure to do so would not have a material adverse effect on
the Borrower and its Consolidated Subsidiaries taken as a whole.
(b) The Borrower will maintain or cause to be maintained, for
itself and its Consolidated Subsidiaries, all to the extent
material to the Borrower and its Consolidated Subsidiaries taken as
a whole, physical damage insurance on all real and personal
property on an all risks basis, covering the repair and replacement
cost of all such property and consequential loss coverage for
business interruption and extra expense, public liability insurance
in an amount not less than $10,000,000 and such other insurance
against risks of the kinds customarily insured against by
corporations of established reputation engaged in the same or
similar business and similarly situated, of such type and in such
amounts as are customarily carried under similar circumstances.
6.3 Conduct of Business and Maintenance of Existence.
The Borrower will continue, and will cause each Consolidated
Subsidiary to continue, to engage predominantly in business of the
same general type as now conducted by the Borrower and its
Consolidated Subsidiaries, and, except as otherwise permitted by
Section 6.10 hereof, will preserve, renew and keep in full force
and effect, and will cause each Consolidated Subsidiary to
preserve, renew and keep in full force and effect their respective
corporate existence and their respective rights and franchises
necessary in the normal conduct of business, all to the extent
material to the Borrower and its Consolidated Subsidiaries taken as
a whole.
6.4 Compliance with Laws. The Borrower will comply, and
cause each Consolidated Subsidiary to comply, in all material
respects with all applicable laws, ordinances, rules, regulations,
and requirements of governmental authorities
PAGE
(including, without limitation, ERISA and the rules and regulations
thereunder and all federal, state and local statutes, laws or
regulations or other governmental restrictions relating to
environmental protection, hazardous substances or the cleanup or
other remediation thereof) except where the necessity of compliance
therewith is contested in good faith by appropriate proceedings or
where the failure to comply would not have a material adverse
effect on the Borrower and its Consolidated Subsidiaries taken as
a whole.
6.5 Inspection of Property, Books and Records.
(a) The Borrower will keep, and will cause each Consolidated
Subsidiary to keep, proper books of record and account in
accordance with sound business practice so as to permit its
financial statements to be prepared in accordance with generally
accepted accounting principles; and will permit representatives of
the Bank at the Bank's expense to visit and inspect any of the
Borrower's properties, to examine and make abstracts from any of
the Borrower's corporate books and financial records and to discuss
the Borrower's affairs, finances and accounts with the principal
officers of the Borrower and its independent public accountants,
all at such reasonable times and as often as may reasonably be
necessary to ensure compliance by the Borrower with its obligations
hereunder.
(b) With the consent of the Borrower (which consent will not
be unreasonably withheld) or, if an Event of Default has occurred
and is continuing, without the requirement of any such consent, the
Borrower will permit representatives of the Bank, at the Bank's
expense, to visit and inspect any of the properties of and to
examine the corporate books and financial records of any
Consolidated Subsidiary and make copies thereof or extracts
therefrom and to discuss the affairs, finances and accounts of such
Consolidated Subsidiary with its and the Borrower's principal
officers and the Borrower's independent public accountants, all at
such reasonable times and as often as the Bank may reasonably
request.
6.6 Cash Flow to Total Borrowed Funds. The ratio of
Cash Flow to Total Borrowed Funds shall not be less than .30 for
any consecutive four quarters, such ratio to be calculated at the
end of each quarter on a trailing four quarter basis.
6.7 Total Borrowed Funds to Consolidated Net Worth.
Total Borrowed Funds will not exceed 85% of Consolidated Net Worth
at end of any quarter of any fiscal year.
6.8 Minimum Consolidated Net Worth. Consolidated Net
Worth will at no time be less than $550,000,000 plus 25% of the
PAGE
consolidated net income of the Borrower at the end of each fiscal
quarter for each fiscal year commencing after the fiscal year
ending December 31, 1994.
6.9 Negative Pledge. Neither the Borrower nor any
Consolidated Subsidiary will create, assume or suffer to exist any
Lien on any asset now owned or hereafter acquired by it, except
for:
(a) Liens existing on the date hereof;
(b) any Lien existing on any asset of any corporation at the
time such corporation becomes a Consolidated Subsidiary and not
created in contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed
for the purpose of financing all or any part of the cost of
acquiring such asset, provided that such Lien attaches to such
asset concurrently with or within 90 days after the acquisition
thereof;
(d) any Lien on any asset of any corporation existing at the
time such corporation is merged into or consolidated with the
Borrower or a Consolidated Subsidiary and not created in
contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Consolidated Subsidiary and not
created in contemplation of such acquisition;
(f) any Lien created in connection with capitalized lease
obligations, but only to the extent that such Lien encumbers
property financed by such capital lease obligation and the
principal component of such capitalized lease obligation is not
increased;
(g) Liens arising in the ordinary course of its business
which (i) do not secure Debt and (ii) do not in the aggregate
materially impair the operation of the business of the Borrower and
its Consolidated Subsidiaries, taken as a whole;
(h) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by
any of the foregoing clauses of this Section, provided that such
Debt is not increased and is not secured by any additional assets;
(i) Liens securing taxes, assessments, fees or other
governmental charges or levies, Liens securing the claims of
materialmen, mechanics, carriers, landlords, warehousemen and
PAGE
similar Persons, Liens incurred in the ordinary course of business in
connection with workmen's compensation, unemployment insurance and
other similar laws, Liens to secure surety, appeal and performance
bonds and other similar obligations not incurred in connection with
the borrowing of money, and attachment, judgment and other similar
Liens arising in connection with court proceedings so long as the
enforcement of such Liens is effectively stayed and the claims
secured thereby are being contested in good faith by appropriate
proceedings;
(j) Liens not otherwise permitted by the foregoing clauses of
this Section securing Debt in an aggregate principal amount at any
time outstanding not to exceed 10% of Consolidated Net Worth;
(k) any Liens on any asset of Quest & Associates, Inc., a
Subsidiary of Borrower, created in connection with the August 1995
investment by Quest & Associates, Inc. in a portfolio of computer
equipment leases; and
(l) any Liens on property arising in connection with a
securities repurchase transaction.
6.10 Consolidations, Mergers and Sales of Assets. The
Borrower will not (i) consolidate or merge with or into any other
Person (other than a Subsidiary of the Borrower) unless the
Borrower's shareholders immediately before the merger or
consolidation are to own more than 70% of the combined voting power
of the resulting entity's voting securities or (ii) sell, lease or
otherwise transfer all or substantially all of the Borrower's
business or assets to any other Person (other than a Subsidiary of
the Borrower). The Borrower will not permit any Significant
Subsidiary or (in a series of related transactions) any significant
Group of Subsidiaries to consolidate with, merge with or into or
transfer all of any substantial part of its assets to any Person
other than the Borrower or a Subsidiary of the Borrower.
6.11 Use of Proceeds. The proceeds of the Loans will be
used for general corporate purposes, including the making of
acquisitions. No part of the proceeds of any Loan hereunder will be
used, directly or indirectly, for the purpose, whether immediate,
incidental or ultimate of buying or carrying any "Margin stock" in
violation of Regulation U. If requested by the Bank, the Borrower
will furnish to the Bank in connection with any Loan hereunder a
statement in conformity with the requirements of Federal Reserve Form
U-1 referred to in Regulation U.
PAGE
SECTION 7
EVENTS OF DEFAULT
7.1 Events of Default. If any one or more of the
following events ("Events of Default") shall have occurred and be
continuing:
(a) the Borrower shall fail to pay (i) any principal of any
Loan when due or (ii) interest on any Loan or any commitment fee
within four days after the same has become due; or
(b) any Subsidiary Borrower shall fail to pay any principal
of or interest on any Subsidiary Loan when due and such failure
shall not be remedied by such Subsidiary Borrower or the Borrower
within four Domestic Business Days after written notice thereof
has been given to such Subsidiary Borrower and the Borrower by
the Bank; or
(c) the Borrower shall fail to observe or perform any
covenant contained in Section 6.1(d) or Sections 6.6 to 6.8 or
6.10 hereof; or
(d) the Borrower shall fail to observe or perform any
covenant or agreement contained in this Agreement (other than
those covered by clause (a) or (c) above) for 30 days after
written notice thereof has been given to the Borrower by the
Bank; or
(e) any representation, warranty or certification made by
the Borrower in this Agreement or in any certificate, financial
statement or other document delivered pursuant to this Agreement
shall prove to have been incorrect in any material respect upon
the date when made or deemed made; or
(f) (1) the Borrower or any Significant Subsidiary or
Significant Group of Subsidiaries defaults in any payment at any
stated maturity of principal of or interest on any other
obligation for money borrowed (or any capitalized lease
obligation, any obligation under a purchase money mortgage,
conditional sale or other title retention agreement or any
obligation under notes payable or drafts accepted representing
extensions of credit) beyond any period of grace provided with
respect thereto or (2) the Borrower or any Significant Subsidiary
or Significant Group of Subsidiaries defaults in any payment
other than at any stated maturity of principal of or interest on
any other obligation for money borrowed (or any capitalized lease
obligation, any obligation under a purchase money mortgage,
conditional sale or other title retention agreement or any
obligation under notes payable or drafts accepted representing
extensions of credit) beyond any period of
PAGE
grace provided with respect thereto, or the Borrower or any
Significant Subsidiary or Significant Group of Subsidiaries fails
to perform or observe any other agreement, term or condition
contained in any agreement under which any such obligation is
created (or if any other event thereunder or under any such
agreement shall occur and be continuing), and the effect of such
default with respect to a payment other than at any stated
maturity, failure or other event is to cause, or to permit the
holder or holders of such obligation (or a trustee on behalf of
such holder or holders) to cause, such obligation to become due
or to require the purchase thereof prior to any stated maturity;
provided that the aggregate amount of all obligations as to which
any such payment defaults (whether or not at stated maturity),
failures or other events shall have occurred and be continuing
exceeds $10,000,000 and provided, further, that it is understood
that the obligations referred to herein exclude those obligations
arising in connection with securities repurchase transactions; or
(g) the Borrower or any Significant Subsidiary or Significant
Group of Subsidiaries shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, or
shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment
for the benefit of creditors, or shall fail generally to pay its
debts as they become due, or shall take any corporate action to
authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be
commenced against the Borrower or any Significant Subsidiary or
Significant Group of Subsidiaries seeking liquidation,
reorganization or other relief with respect to it or its debts
under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, and such involuntary
case or other proceeding shall remain undismissed and unstayed
for a period of 60 days; or an order for relief shall be entered
against the Borrower or any Significant Subsidiary or Significant
Group of Subsidiaries under the federal bankruptcy laws as now or
hereafter in effect; or
(i) any member of the ERISA Group shall fail to pay when
due any amount or amounts aggregating in excess of $1,000,000
which it shall have become liable to pay to the PBGC or to a Plan
under Title IV of ERISA (except where such liability is contested
in good faith by appropriate proceedings as permitted under
PAGE
Section 6.4); or notice of intent to terminate a Material Plan
(other than any multiple employer plan within the meaning of
Section 4063 of ERISA) shall be filed under Title IV of ERISA by
any member of the ERISA Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute
proceedings under Title IV of ERISA to terminate, to impose
liability (other than for premiums under Section 4007 of ERISA)
in respect of, or to cause a trustee to be appointed to
administer any such Material Plan; or
(j) judgments or orders for the payment of money in excess
of $10,000,000 in the aggregate shall be rendered against the
Borrower or any Significant Subsidiary or Significant Group of
Subsidiaries and such judgments or orders shall continue
unsatisfied and unstayed for a period of 60 days; or
(k) any person or group of persons (within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended (the "1934 Act")), other than the Borrower or any of its
Subsidiaries, becomes the beneficial owner (within the meaning of
Rule 13d-3 under the 1934 Act) of 30% or more of the combined
voting power of the Borrower's then outstanding voting
securities; or a tender offer or exchange offer (other than an
offer by the Borrower or a Subsidiary) pursuant to which 30% or
more of the combined voting power of the Borrower's then
outstanding voting securities was purchased, expires; or during
any period of two consecutive years, individuals who, at the
beginning of such period, constituted the Board of Directors of
the Borrower cease for any reason to constitute at least a
majority thereof, unless the election or the nomination for the
election by the Borrower's stockholders of each new director was
approved by a vote of at least two-thirds of the directors then
still in office who were directors at the beginning of the
period;
then, and in every such event, (1) in the case of any of the
Events of Default specified in paragraphs (g) or (h) above,
the Commitment shall thereupon automatically be terminated
and the principal of and accrued interest on the Note shall
automatically become due and payable without presentment,
demand, protest or other notice or formality of any kind,
all of which are hereby expressly waived and (2) in the case
of any other Event of Default specified above, the Bank may,
by notice in writing to the Borrower, terminate the
Commitment hereunder, if still in existence, and it shall
thereupon be terminated, and the Bank may, by notice in
writing to the Borrower, declare the Note and all other sums
payable under this Agreement to be, and the same shall
thereupon forthwith become, due and payable without
presentment, demand, protest or other notice or formality of
any kind, all of which are hereby expressly waived.
PAGE
SECTION 8
MISCELLANEOUS
8.1 Notices. Unless otherwise specified herein all
notices, requests, demands or other communications to or from the
parties hereto shall be sent by United States mail, certified,
return receipt requested, telegram, telex or facsimile, and shall
be deemed to have been duly given upon receipt thereof. In the
case of a telex, receipt of such communication shall be deemed to
occur when the sender receives its answer back. In the case of a
facsimile, receipt of such communication shall be deemed to occur
when the sender confirms such receipt by telephone. Any such
notice, request, demand or communication shall be delivered or
addressed as follows:
(a ) if to the Borrower, to it at 1271 Avenue of the
Americas, New York, New York 10020; Attention: Vice President and
Treasurer (with a copy at the same address to the Vice President
and General Counsel);
(b) if to the Bank, communications relating to its
Eurodollar Loans (including without limitation any Sterling
Loans) shall be delivered or addressed to the address or telex
number set forth on the signature pages hereof for its Eurodollar
Lending Office and all other communications shall be delivered or
addressed to the address or telex number set forth on the
signature pages hereof for its Domestic Lending Office;
or at such other address or telex number as any party hereto may
designate by written notice to the other party hereto.
8.2 Amendments and Waivers; Cumulative Remedies.
(a) None of the terms of this Agreement may be waived,
altered or amended except by an instrument in writing duly
executed by the Borrower and the Bank.
(b) No failure or delay by the Bank in exercising any
right, power or privilege hereunder or under the Note shall
operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The
rights and remedies provided herein shall be cumulative and not
exclusive of any rights or remedies provided by law.
PAGE
8.3 Successors and Assigns.
(a) The provisions of this Agreement shall be binding
upon and shall inure to the benefit of the Borrower and the
Bank, except that the Borrower may not assign or otherwise
transfer any of its rights and obligations under this
Agreement except as provided in Section 2.15 and Section
6.10 hereof, without the prior written consent of the Bank
which the Bank shall not unreasonably delay or withhold.
(b) The Bank may at any time grant to one or more
banks or other institutions (each a "Participant")
participating interests in its Commitment or any or all of
its Loans. In the event of any such grant by the Bank of a
participating interest to a Participant, whether or not upon
notice to the Borrower the Bank shall remain responsible for
the performance of its obligations hereunder, and the
Borrower shall continue to deal solely and directly with the
Bank in connection with the Bank's rights and obligations
under this Agreement. Any agreement pursuant to which the
Bank may grant such a participating interest shall provide
that the Bank shall retain the sole right and responsibility
to enforce the obligations of the Borrower hereunder
including, without limitation, the right to approve any
amendment, modification or waiver of any provision of this
Agreement; provided that such participation agreement may
provide that the Bank will not agree to any modification,
amendment or waiver of this Agreement (i) which increases or
decreases the Commitment of the Bank (ii) reduces the
principal of or rate of interest on any Loan or fees hereunder
or (iii) postpones the date fixed for any payment of principal
of or interest on any Loan or any fees hereunder without the
consent of the Participant. The Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.12
and 4 with respect to its participating interest.
(c) The Bank may at any time assign all or any portion
of its rights under this Agreement and the Note or Notes to a
Federal Reserve Bank. No such assignment shall release the
Bank from its obligations hereunder.
(d) No Participant or other transferee of the Bank's
rights shall be entitled to receive any greater payment under
Sections 2.12, 4.1 through 4.3 or 8.5 than the Bank would have
been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's
prior written consent or by reason of the provisions of
Section 4.3(c) or 8.5(c) requiring the Bank to designate a
different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise
to such greater payment did not exist.
PAGE
8.4 Expenses; Documentary Taxes; Indemnification.
(a) The Borrower shall pay (i) all out-of-pocket
expenses and internal charges of the Bank (including reasonable
fees and disbursements of counsel) in connection with any Default
hereunder and (ii) if there is an Event of Default, all
out-of-pocket expenses incurred by the Bank (including reasonable
fees and disbursements of counsel) in connection with such Event of
Default and collection and other enforcement proceedings resulting
therefrom. The Borrower shall indemnify the Bank against any
transfer taxes, documentary taxes, assessments or charges made by
any governmental authority by reason of the execution and delivery
of this Agreement or the Note.
(b) The Borrower agrees to indemnify the Bank and hold
the Bank harmless from and against any and all liabilities, losses,
damages, costs and expenses of any kind (including, without
limitation, the reasonable fees and disbursements of counsel for
the Bank in connection with any investigative, administrative or
judicial proceeding, whether or not the Bank shall be designated a
party thereto) which may be incurred by the Bank relating to or
arising out of any actual or proposed use of proceeds of Loans
hereunder or any merger or acquisition involving the Borrower;
provided, that the Bank shall not have the right to be indemnified
hereunder for its own gross negligence or willful misconduct as
determined by a court of competent jurisdiction.
8.5 Withholding Taxes.
(a) With respect to any Loan as to which the Bank's
Applicable Lending Office is located outside the United States, all
payments by the Borrower to the Bank under this Agreement are to be
made free and clear of any and all taxes, duties, imposts, fees,
withholdings or deductions (the "Deductions") of any nature now or
hereafter imposed by the United States of America or any political
subdivision or taxing authority thereof or therein. If any
Deduction is, by law, required to be made from any payment
hereunder, then the Borrower shall (i) made such Deduction, (ii)
pay the amount of such Deduction to the relevant taxing authority
and (iii) pay to the Bank such additional amount as will result in
receipt by the Bank of a net amount equal to the amount the Bank
would have received hereunder had no such Deduction been required,
provided that the Borrower shall not be required to pay any such
additional amount (A) in respect of any tax imposed on the net
income of the Bank by the jurisdiction under the laws of which the
Bank is organized or where its principal place of business or
Applicable Lending Office is located, or any political subdivision
or taxing authority thereof or therein, or (B) to the extent such
Deduction is required as a result of the Bank's failure to comply
with its obligations pursuant to Section 8.5(b) hereof. In the
event such Deduction is so required to be made from any payment
PAGE
hereunder, the Borrower shall, as soon as practicable, deliver to
the Bank any receipts issued by the relevant taxing authority
evidencing the amount of such Deduction and its payment.
(b) The Bank agrees to complete and deliver to the Borrower,
prior to the date on which the first payment to the Bank is due
under any Loan made hereunder and (so long as it remains eligible
to do so) from time to time thereafter, (i) with respect to any
Loan as to which the Bank's Applicable Lending Office is located
outside the United States, an Internal Revenue Service Form 1001
certifying that it is entitled to benefits under an income tax
treaty to which the United States is a party that reduces the rate
of withholding tax on payments of interest to zero or (ii) with
respect to any Loan as to which the Bank's Applicable Lending
Office is located in the United States, an Internal Revenue Service
Form 4224 in duplicate certifying that the income receivable
pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. The Bank
further agrees to complete and deliver to the Borrower from time to
time, so long as it is eligible to do so, any successor or
additional form required by the Internal Revenue Service in order
to secure an exemption from, or reduction in the rate of, U.S.
withholding tax.
(c) The Bank agrees that if the Borrower is required to pay
any additional amounts pursuant to Section 8.5(a) hereof in respect
of any Loan, the Bank will, upon the request of the Borrower,
designate a different Applicable Lending Office if such designation
will reduce the amount of the Deductions required to be made by the
Borrower and will not otherwise be materially disadvantageous to
the Bank.
8.6 Counterparts. This Agreement may be signed in any
number of counterparts with the same effect as if the signatures
thereto and hereto were upon the same instrument.
8.7 Headings; Table of Contents. The section and
subsection headings used herein and the Table of Contents have been
inserted for convenience of reference only and do not constitute
matters to be considered in interpreting this Agreement.
8.8 Governing Law. This Agreement, the Note and the
Subsidiary Note shall be construed in accordance with and governed
by the law of the State of New York.
PAGE
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered by their proper and duly authorized
officers as of June 25, 1996.
THE INTERPUBLIC GROUP OF COMPANIES, INC.
By: ALAN M. FORSTER
Title: Vice President & Treasurer
CHEMICAL BANK
By: THOMAS J. COX
Title: Vice President
Domestic and Eurodollar Lending Offices
Chemical Bank
270 Park Avenue
New York, NY 10020
Attn.: Mr. Fred Vagnini
Tel #: 212-622-4083
Tel #: 212-332-4370
Fed Wire: ABA #021000128
Acct.: Chemical Bank
270 Park Avenue
New York, NY 10020
PAGE
EXHIBIT A
NOTE
June 25, 1996
New York, New York
FOR VALUE RECEIVED, THE INTERPUBLIC GROUP OF COMPANIES,
INC., a Delaware corporation (the "Borrower"), hereby promises to
pay to the order of CHEMICAL BANK (the "Bank"), for the account of
its Applicable Lending Office, the unpaid principal amount of each
Loan made by the Bank to the Borrower pursuant to the Credit
Agreement referred to below on the last day of the Interest Period
relating to such Loan. The Borrower promises to pay interest on
the unpaid principal amount of each such Loan on the dates and at
the rate or rates provided for in the Credit Agreement.
All such payments of principal and interest shall be
made in lawful money of the United States of America in Federal or
other immediately available funds at the office of the Bank located
at 270 Park Avenue, New York, NY 10020.
All Loans made by the Bank, the respective maturities
thereof and all repayments of the principal thereof shall be
recorded by the Bank and, prior to any transfer hereof, endorsed by
the Bank on the schedule attached hereto, or on a continuation of
such schedule attached to and made a part hereof; provided that the
failure of the Bank to make any such recordation or endorsement
shall not affect the obligations of the Borrower hereunder or under
the Credit Agreement.
This note is the Note referred to in the Credit
Agreement dated as of June 25, 1996 between the Borrower and the
Bank (as the same may be amended from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein
with the same meanings. Reference is made to the Credit Agreement
for provisions for the prepayment hereof and the acceleration of
the maturity hereof.
THE INTERPUBLIC GROUP OF COMPANIES, INC.
By: Alan M. Forster
Title: Vice President & Treasurer
PAGE
LOANS AND PAYMENTS OF PRINCIPAL
Amount of
Amount Type Principal Maturity Notation
Date of Loan of Loan Repaid Date Made By
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
PAGE
EXHIBIT B
MONEY MARKET NOTE
June 25, 1996
New York, New York
FOR VALUE RECEIVED, THE INTERPUBLIC GROUP OF COMPANIES,
INC., a Delaware corporation (the "Borrower"), hereby promises to
pay to the order of CHEMICAL BANK (the "Bank"), for the account of
its Domestic Lending Office, Money Market Rate Loans made by the
Bank to the Borrower pursuant to the Credit Agreement referred to
below upon such terms and conditions as may be agreed upon pursuant
to said Credit Agreement. The Borrower promises to pay interest on
the unpaid principal amount of each such Loan on the dates and at
the rate or rates provided for in the Credit Agreement.
All such payments of principal and interest shall be
made in lawful money of the United States of America in Federal or
other immediately available funds at the office of the Bank located
at 270 Park Avenue, New York, NY 10020.
All Money Market Loans made by the Bank, the respective
maturities thereof and all repayments of the principal thereof
shall be recorded by the Bank and, prior to any transfer hereof,
endorsed by the Bank on the schedule attached hereto, or on a
continuation of such schedule attached to and made a part hereof;
provided that the failure of the Bank to make any such recordation
or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This note is one of the Money Market Notes referred to
in the Credit Agreement dated as of June 25, 1996, between the
Borrower and the Bank (as the same may be amended from time to
time, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein with the same meanings. Reference is
made to the Credit Agreement for provisions for the prepayment
hereof and the acceleration of the maturity hereof.
THE INTERPUBLIC GROUP OF COMPANIES, INC.
By: Alan M. Forster
Title: Vice Presient & Treasurer
PAGE
LOANS AND PAYMENTS OF PRINCIPAL
Amount of
Amount Type Principal Maturity Notation
Date of Loan of Loan Repaid Date Made By
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
PAGE
EXHIBIT C
NOTE
June 25, 1996
New York, New York
FOR VALUE RECEIVED, DraftDirect Worldwide, Inc., a
Delaware corporation (the "Subsidiary Borrower"), hereby promises
to pay to the order of CHEMICAL BANK (the "Bank"), for the account
of its Applicable Lending Office, the unpaid principal amount of
each Subsidiary Loan made by the Bank to the Subsidiary Borrower
pursuant to Section 2.15 of the Credit Agreement referred to below
on the last day of the Interest Period relating to such Subsidiary
Loan. The Subsidiary Borrower promises to pay interest on the
unpaid principal amount of each such Subsidiary Loan on the dates
and at the rate or rates provided for in the Credit Agreement.
All such payments of principal and interest shall be
made in lawful money of the United States of America in Federal or
other immediately available funds at the office of the Bank located
at 270 Park Avenue, New York, NY 10020.
All Subsidiary Loans made by the Bank, the respective
maturities thereof and all repayments of the principal thereof
shall be recorded by the Bank and, prior to any transfer hereof,
endorsed by the Bank on the schedule attached hereto, or on a
continuation of such schedule attached to and made a part hereof;
provided that the failure of the Bank to make any such recordation
or endorsement shall not affect the obligations of the Subsidiary
Borrower hereunder or under the Credit Agreement.
This note is the Subsidiary Note referred to in Section
2.14 of the Credit Agreement dated as of June 25, 1996 between The
Interpublic Group of Companies, Inc. and the Bank (as the same may
be amended from time to time, the "Credit Agreement"). Terms
defined in the Credit Agreement are used herein with the same
meanings. Reference is made to the Credit Agreement for provisions
for the prepayment hereof and the acceleration of the maturity
hereof.
DraftDirect Worldwide, Inc.
By: Daniel E. Ginsburg
Title: President
PAGE
LOANS AND PAYMENTS OF PRINCIPAL
Amount of
Amount Type Principal Maturity Notation
Date of Loan of Loan Repaid Date Made By
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
PAGE
GUARANTY
The Interpublic Group of Companies, Inc. (the
"Guarantor") hereby unconditionally guarantees to the Bank the due
and punctual payment of the principal of, and interest on, the Note
upon which this Guaranty is endorsed (the "Note"). The foregoing
is an absolute, continuing and irrevocable guaranty of payment and
not of collectibility or performance. The Guarantor hereby waives
diligence, presentment and demand of payment (except as provided in
the Credit Agreement) and covenants that this Guaranty will not be
discharged except by payment as herein provided. Until all amounts
of principal of, and interest on, the Note have been paid or
otherwise satisfied in full, the Guarantor will not exercise any
rights that it may have acquired by way of subrogation under this
Guaranty, by any payment made hereunder or otherwise, or accept any
payment on account of such subrogation rights. If any payment (or
part thereof) of the principal of, or interest on, the Note is
rescinded or must otherwise be returned by the Bank upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization
of the primary obligor under the Note, this Guaranty shall continue
to be effective, or be reinstated, as to said payment (or part
thereof) as if such payment (or part thereof) had not been made.
THE INTERPUBLIC GROUP OF COMPANIES, INC.
By: Alan M. Forster
Title: Vice President