Exhibit 10.3
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CREDIT AGREEMENT
among
K-III COMMUNICATIONS CORPORATION,
VARIOUS LENDING INSTITUTIONS,
THE BANK OF NEW YORK
and
BANKERS TRUST COMPANY,
AS CO-SYNDICATION AGENTS,
THE BANK OF NOVA SCOTIA,
AS DOCUMENTATION AGENT
and
THE CHASE MANHATTAN BANK, N.A.,
AS ADMINISTRATIVE AGENT
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Dated as of May 24, 1996
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$250,000,000
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TABLE OF CONTENTS
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SECTION 1. Amount and Terms of Credit.............................. 1
1.01 Commitments............................................. 1
1.02 Minimum Borrowing Amounts, etc.......................... 2
1.03 Notice of Borrowing..................................... 2
1.04 Disbursement of Funds................................... 3
1.05 Register................................................ 3
1.06 Conversions............................................. 4
1.07 Pro Rata Borrowings..................................... 4
1.08 Interest................................................ 4
1.09 Interest Periods........................................ 5
1.10 Increased Costs, Illegality, etc........................ 7
1.11 Compensation............................................ 10
1.12 Change of Lending Office................................ 11
SECTION 2. Fees; Commitments....................................... 11
2.01 Fees.................................................... 11
2.02 Voluntary Reduction of Commitments...................... 11
2.03 Mandatory Reduction of Commitments, etc................. 12
SECTION 3. Payments................................................ 13
3.01 Voluntary Prepayments................................... 13
3.02 Mandatory Repayments.................................... 13
3.03 Method and Place of Payment............................. 15
3.04 Net Payments............................................ 16
SECTION 4. Conditions Precedent.................................... 17
4.01 Execution of Agreement.................................. 17
4.02 No Default; Representations and Warranties.............. 17
4.03 Opinions of Counsel..................................... 17
4.04 Corporate Proceedings................................... 18
(i)
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4.05 Existing Credit Agreements.............................. 18
4.06 Subsidiary Guaranty..................................... 19
4.07 Notice of Borrowing..................................... 19
4.08 Payment of Fees, etc.................................... 19
4.09 Contribution Agreement.................................. 19
4.10 Existing Indebtedness Agreements........................ 19
4.11 Additional Credit Agreement............................. 19
SECTION 5. Representations, Warranties and Agreements.............. 20
5.01 Corporate Status........................................ 20
5.02 Corporate Power and Authority........................... 20
5.03 No Violation............................................ 21
5.04 Litigation.............................................. 21
5.05 Use of Proceeds; Margin Regulations..................... 21
5.06 Governmental Approvals.................................. 22
5.07 Investment Company Act.................................. 22
5.08 Public Utility Holding Company Act...................... 22
5.09 True and Complete Disclosure............................ 22
5.10 Financial Statements; Financial Condition............... 23
5.11 Tax Returns and Payments................................ 23
5.12 Compliance with ERISA................................... 24
5.13 Subsidiaries............................................ 24
5.14 Intellectual Property................................... 25
5.15 Compliance with Statutes, etc........................... 26
SECTION 6. Affirmative Covenants................................... 26
6.01 Information Covenants................................... 26
6.02 Books, Records and Inspections.......................... 28
6.03 Payment of Taxes........................................ 29
6.04 Corporate Franchises.................................... 29
6.05 Compliance with Statutes, etc........................... 29
6.06 ERISA................................................... 30
6.07 End of Fiscal Years; Fiscal Quarters.................... 30
6.08 Use of Proceeds......................................... 31
6.09 Ownership of Subsidiaries............................... 31
6.10 Maintenance of Corporate Separateness................... 31
(ii)
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SECTION 7. Negative Covenants...................................... 31
7.01 Changes in Business..................................... 31
7.02 Consolidation, Merger, Sale or Purchase of Assets, etc.. 32
7.03 Liens................................................... 35
7.04 Indebtedness............................................ 37
7.05 Advances, Investments and Loans......................... 39
7.06 Contingent Obligations.................................. 42
7.07 Dividends, etc.......................................... 43
7.08 Transactions with Affiliates............................ 45
7.09 Fixed Charge Coverage Ratio............................. 46
7.10 Interest Coverage Ratio................................. 46
7.11 Leverage Ratio.......................................... 46
7.12 Issuance of Stock....................................... 47
7.13 Modifications of Certain Agreements, etc................ 48
7.14 Limitation on the Creation of Subsidiaries;
Redesignation of Partially-Owned Restricted
Subsidiaries.......................................... 49
7.15 Limitation on Payments Under the Non-Compete Notes...... 50
SECTION 8. Events of Default....................................... 50
8.01 Payments................................................ 50
8.02 Representations, etc.................................... 50
8.03 Covenants............................................... 50
8.04 Default Under Other Agreements.......................... 50
8.05 Bankruptcy, etc......................................... 51
8.06 ERISA................................................... 51
8.07 Subsidiary Guaranty..................................... 52
8.08 Judgments............................................... 52
8.09 Ownership............................................... 52
SECTION 9. Definitions............................................. 53
SECTION 10. The Administrative Agent............................... 83
10.01 Appointment............................................ 83
10.02 Delegation of Duties................................... 83
(iii)
10.03 Exculpatory Provisions.................................. 83
10.04 Reliance by Administrative Agent........................ 84
10.05 Notice of Default....................................... 84
10.06 Non-Reliance on Administrative Agent and Other Banks.... 85
10.07 Indemnification......................................... 85
10.08 Administrative Agent in Its Individual Capacity......... 86
10.09 Holders................................................. 87
10.10 Resignation of the Administrative Agent; Successor Agent 87
SECTION 11. Miscellaneous........................................... 87
11.01 Payment of Expenses, etc................................ 87
11.02 Right of Setoff......................................... 88
11.03 Notices................................................. 88
11.04 Benefit of Agreement.................................... 89
11.05 No Waiver; Remedies Cumulative.......................... 91
11.06 Payments Pro Rata....................................... 91
11.07 Calculations; Computations.............................. 92
11.08 Governing Law; Submission to Jurisdiction; Venue........ 92
11.09 Counterparts............................................ 93
11.10 Effectiveness........................................... 94
11.11 Headings Descriptive.................................... 94
11.12 Amendment or Waiver..................................... 94
11.13 Survival................................................ 95
11.14 Domicile of Loans....................................... 95
11.15 Confidentiality......................................... 95
11.16 Waiver of Jury Trial.................................... 95
ANNEX I List of Banks
ANNEX II Bank Addresses
ANNEX III Subsidiaries
ANNEX IV Liens
ANNEX V Existing Debt/Existing Contingent Obligations
ANNEX VI Existing Preferred Stock
(iv)
EXHIBIT A -- Form of Notice of Borrowing
EXHIBIT B-1 -- Form of Opinion of Simpson, Thacher & Bartlett
EXHIBIT B-2 -- Form of Opinion of Beverly C. Chell, Esq.
EXHIBIT B-3 -- Form of Opinion of White & Case
EXHIBIT C -- Form of Officer's Certificate
EXHIBIT D -- Form of Subsidiary Guaranty
EXHIBIT E -- Form of Contribution Agreement
EXHIBIT F -- Form of Assignment and Assumption
Agreement
EXHIBIT G -- Form of Subsidiary Assumption Agreement
(v)
CREDIT AGREEMENT, dated as of May 24, 1996, among K-III
COMMUNICATIONS CORPORATION, a Delaware corporation (the "Company"), the lending
institutions listed from time to time on Annex I hereto (each a "Bank" and,
collectively, the "Banks"), THE BANK OF NEW YORK and BANKERS TRUST COMPANY, as
Co-Syndication Agents, THE BANK OF NOVA SCOTIA, as Documentation Agent and THE
CHASE MANHATTAN BANK, N.A., as Administrative Agent (the "Administrative
Agent"). Unless otherwise defined herein, all capitalized terms used herein and
defined in Section 9 are used herein as so defined.
W I T N E S S E T H :
WHEREAS, subject to and upon the terms and conditions herein set
forth, the Banks are willing to make available the credit facility provided for
herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 Commitments. (a) Subject to and upon the terms and conditions
herein set forth, each Bank severally agrees at any time and from time to time
on and after the Effective Date and prior to the Conversion Date, to make a
revolving loan or revolving loans (each a "Revolving Loan" and, collectively,
the "Revolving Loans") to the Company, which Revolving Loans (i) shall, at the
option of the Company, be Base Rate Loans or Eurodollar Loans, provided that all
Revolving Loans made as part of the same Borrowing shall, unless otherwise
specifically provided herein, consist of Revolving Loans of the same Type, (ii)
may be repaid and reborrowed in accordance with the provisions hereof, (iii)
shall not exceed for any Bank at any time outstanding that aggregate principal
amount which equals the Revolving Loan Commitment of such Bank at such time.
(b) Subject to and upon the terms and conditions set forth herein,
the Company and each Bank which has Revolving Loans outstanding at such time
agree that, at 9:00 A.M. (New York time) on the Conversion Date, the aggregate
principal amount of Revolving Loans owing to such Bank and outstanding at such
time shall (unless such
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Revolving Loans have been declared (or have become) due and payable pursuant
to this Agreement), without any notice or action by any party, automatically
convert to and thereafter constitute Term Loans owing to such Bank hereunder.
The Term Loans of any Bank (i) shall, at the option of the Company, be Base
Rate Loans or Eurodollar Loans, provided that all Term Loans comprising the
same Borrowing shall, unless otherwise specifically provided herein, consist
of Term Loans of the same Type and (ii) shall not exceed in initial principal
amount for such Bank an amount which equals the aggregate principal amount of
Revolving Loans owed to such Bank and outstanding immediately prior to such
conversion. Once repaid, Term Loans may not be reborrowed.
1.02 Minimum Borrowing Amounts, etc. The aggregate principal amount
of each Borrowing shall not be less than the Minimum Borrowing Amount. More than
one Borrowing may be incurred on any day, provided that at no time shall there
be outstanding more than 5 Borrowings of Eurodollar Loans.
1.03 Notice of Borrowing. (a) Whenever the Company desires to incur
Revolving Loans hereunder, it shall give the Administrative Agent at its Notice
Office, prior to 12:00 Noon (New York time), at least three Business Days' prior
written notice (or telephonic notice promptly confirmed in writing) of each
Borrowing of Eurodollar Loans and at least one Business Day's prior written
notice (or telephonic notice promptly confirmed in writing) of each Borrowing of
Base Rate Loans to be incurred hereunder. Each such notice (each a "Notice of
Borrowing"), except as otherwise expressly provided in Section 1.10, shall be
irrevocable, and, in the case of each written notice and each confirmation of
telephonic notice, shall be in the form of Exhibit A, appropriately completed to
specify (i) the aggregate principal amount of the Revolving Loans to be made
pursuant to such Borrowing, (ii) the date of such Borrowing (which shall be a
Business Day) and (iii) whether the respective Borrowing shall consist of Base
Rate Loans or Eurodollar Loans and, if Eurodollar Loans, the Interest Period to
be initially applicable thereto. The Administrative Agent shall promptly give
each Bank which is required to make Revolving Loans pursuant to the Borrowing
specified in the respective Notice of Borrowing written notice (or telephonic
notice promptly confirmed in writing) of each proposed Borrowing, of such Bank's
proportionate share thereof, if any, and of the other matters covered by the
Notice of Borrowing.
(b) Without in any way limiting the obligation of the Company to
confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent may prior to receipt of written confirmation act without
liability upon the basis of such telephonic notice, believed by the
Administrative Agent, in good faith to be from the chairman, a vice chairman,
the president, a vice president, a treasurer, an assistant
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treasurer or the director of treasury operations of the Company. In each such
case, the Company hereby waives the right to dispute the Administrative
Agent's record of the terms of such telephonic notice.
1.04 Disbursement of Funds. No later than 1:00 P.M. (New York time)
on the date specified in each Notice of Borrowing, each Bank will make available
its Pro Rata Share (if any) of each Borrowing requested to be made on such date
in the manner provided below. All such amounts shall be made available to the
Administrative Agent in U.S. Dollars and immediately available funds at the
Payment Office and the Administrative Agent promptly will make available to the
Company by depositing to its account at the Payment Office the aggregate of the
amounts so made available in the type of funds received. Unless the
Administrative Agent shall have been notified by any Bank prior to the date of
Borrowing that such Bank does not intend to make available to the Administrative
Agent its portion of the Borrowing or Borrowings to be made on such date, the
Administrative Agent may assume that such Bank has made such amount available to
the Administrative Agent on such date of Borrowing, and the Administrative
Agent, in reliance upon such assumption, may (in its sole discretion and without
any obligation to do so) make available to the Company a corresponding amount.
If such corresponding amount is not in fact made available to the Administrative
Agent by such Bank and the Administrative Agent has made available same to the
Company, the Administrative Agent shall be entitled to recover such
corresponding amount from such Bank. If such Bank does not pay such
corresponding amount forthwith upon the Administrative Agent's demand therefor,
the Administrative Agent shall promptly notify the Company, and the Company
shall immediately pay such corresponding amount to the Administrative Agent. The
Administrative Agent shall also be entitled to recover from the Bank or the
Company, as the case may be, interest on such corresponding amount in respect of
each day from the date such corresponding amount was made available by the
Administrative Agent to the Company to the date such corresponding amount is
recovered by the Administrative Agent, at a rate per annum equal to (x) if paid
by such Bank, the overnight Federal Funds rate or (y) if paid by the Company,
the then applicable rate of interest, calculated in accordance with Section
1.08, for the Loans. Nothing herein shall be deemed to relieve any Bank from its
obligation to fulfill its commitments hereunder or to prejudice any rights which
the Company may have against any Bank as a result of any failure by such Bank to
make Loans hereunder.
1.05 Register. (a) The Administrative Agent shall maintain a
register for the recordation of the Revolving Loan Commitments of the Banks from
time to time and (i) if prior to the Conversion Date, the principal amount of
the Revolving Loans, and (ii) if the Conversion Date has occurred, the principal
amount of the Term Loans owing
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to each Bank (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error. The Register
shall be available for inspection by the Company or any Bank at any
reasonable time and from time to time upon reasonable prior notice.
(b) The Company hereby agrees to provide a Note, promptly upon the
request of any Bank, to the extent such Bank has requested such Note in
connection with any pledge or assignment by such Bank of any or all of its Loans
hereunder to a Federal Reserve Bank.
1.06 Conversions. The Company shall have the option to convert on
any Business Day all or a portion at least equal to the applicable Minimum
Borrowing Amount of the outstanding principal amount of the Loans into a
Borrowing or Borrowings of another Type of Loan; provided that (i) no such
partial conversion of a Borrowing of Eurodollar Loans shall reduce the
outstanding principal amount of the Eurodollar Loans made pursuant to such
Borrowing to less than the Minimum Borrowing Amount applicable thereto, (ii)
Base Rate Loans may not be converted into Eurodollar Loans if a Default or Event
of Default is in existence and the Administrative Agent and/or the Required
Banks have notified the Company that such a conversion will not be permitted as
a result thereof and (iii) Borrowings of Eurodollar Loans resulting from this
Section 1.06 shall be limited in number as provided in Section 1.02. Each such
conversion shall be effected by the Company by giving the Administrative Agent
at its Notice Office, prior to 12:00 Noon (New York time), at least three
Business Days (or one Business Day in the case of a conversion into Base Rate
Loans) prior written notice (or telephonic notice promptly confirmed in writing)
(each a "Notice of Conversion") specifying the Loans to be so converted, the
Type of Loans to be converted into and, if to be converted into a Borrowing of
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Administrative Agent shall give each Bank prompt notice of any such proposed
conversion affecting any of its Loans.
1.07 Pro Rata Borrowings. All Borrowings of Loans under this
Agreement shall be made by the Banks pro rata on the basis of their Revolving
Loan Commitments. It is understood that no Bank shall be responsible for any
default by any other Bank of its obligation to make Loans hereunder and that
each Bank shall be obligated to make the Loans to be made by it hereunder,
regardless of the failure of any other Bank to make its Loans hereunder.
1.08 Interest. (a) The unpaid principal amount of each Base Rate
Loan shall bear interest from the date of the Borrowing thereof until maturity
(whether by
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aceleration or otherwise) at a rate per annum which shall at all times be the
Applicable Margin plus the Base Rate in effect from time to time.
(b) The unpaid principal amount of each Eurodollar Loan shall bear
interest from the date of the Borrowing thereof until maturity (whether by
acceleration or otherwise) at a rate per annum which shall at all times be the
Applicable Margin plus the relevant Eurodollar Rate.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan shall bear interest at a rate per annum equal
to the Base Rate in effect from time to time plus the sum of (i) 2% and (ii) the
Applicable Margin for Base Rate Loans; provided that principal in respect of
Eurodollar Loans shall bear interest after the same becomes due (whether by
acceleration or otherwise) until the end of the applicable Interest Period for
such Eurodollar Loan at a per annum rate equal to 2% in excess of the rate of
interest applicable on the due date therefor.
(d) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any repayment thereof and shall be
payable (i) in respect of each Base Rate Loan, quarterly in arrears on the last
Business Day of each March, June, September and December, (ii) in respect of
each Eurodollar Loan, on the last day of each Interest Period applicable thereto
and, in the case of an Interest Period in excess of three months, on each date
occurring at three month intervals after the first day of such Interest Period
and (iii) in respect of each Loan, on any prepayment or conversion (on the
amount prepaid or converted), at maturity (whether by acceleration or otherwise)
and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section 11.07(b).
(f) The Administrative Agent, upon determining the interest rate for
any Borrowing of Eurodollar Loans for any Interest Period, shall promptly notify
the Company and the Banks thereof.
1.09 Interest Periods. At the time the Company gives a Notice of
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, a Borrowing of Eurodollar Loans (in the case of the initial Interest
Period applicable thereto) or prior to 12:00 Noon (New York time) on the third
Business Day prior to the expiration of an Interest Period applicable to a
Borrowing of Eurodollar Loans, it shall have the right to elect by giving the
Administrative Agent written notice (or telephonic
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notice promptly confirmed in writing) of the Interest Period applicable to
such Borrowing, which Interest Period shall, at the option of the Company, be
a one, two, three, six or, if available to each of the Banks (as determined
by each such Bank in good faith based on prevailing conditions in the
interbank Eurodollar market on any date of determination thereof), nine or
twelve month period. Notwithstanding anything to the contrary contained above:
(i) the initial Interest Period for any Borrowing of Eurodollar Loans
shall commence on the date of such Borrowing (including the date of any
conversion from a Borrowing of Base Rate Loans) and each Interest Period
occurring thereafter in respect of such Borrowing shall commence on the
day on which the next preceding Interest Period applicable thereto
expires;
(ii) if any Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period, such Interest Period shall end on the last Business Day
of such calendar month;
(iii) if any Interest Period would otherwise expire on a day which is
not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period would
otherwise expire on a day which is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such
Interest Period shall expire on the next preceding Business Day;
(iv) no Interest Period shall extend beyond the Final Maturity Date;
and
(v) no Interest Period may be elected at any time when a Default or
Event of Default is then in existence and the Administrative Agent and/or
the Required Banks have notified the Company that such an election will
not be permitted as a result thereof.
If upon the expiration of any Interest Period, the Company has failed to elect a
new Interest Period to be applicable to the respective Borrowing of Eurodollar
Loans as provided above, or a Default or an Event of Default then exists and the
Administrative Agent and/or the Required Banks have given the notice referred to
in clause (v) above, the Company shall be deemed to have elected to convert such
Borrowing into a Borrowing of Base Rate Loans effective as of the expiration
date of such current Interest Period.
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1.10 Increased Costs, Illegality, etc. (a) In the event that (x) in
the case of clause (i) below, the Administrative Agent or (y) in the case of
clauses (ii) and (iii) below, any Bank, shall have determined (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any Interest
Period that, by reason of any changes arising after the date of this
Agreement affecting the interbank Eurodollar market, adequate and fair
means do not exist for ascertaining the applicable interest rate on the
basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loans because of (x) any change since the date of this
Agreement in any applicable law, governmental rule, regulation, guideline,
order or request (whether or not having the force of law), or in the
interpretation or administration thereof and including the introduction of
any new law or governmental rule, regulation, guideline, order or request
such as, for example, but not limited to, (A) a change since the Effective
Date in the basis of taxation of payment to any Bank of the principal of
or interest on the Loans or any other amounts payable hereunder (except
for changes with respect to Taxes and those taxes described in clauses (x)
and (y) of the proviso in the second sentence of Section 4.04) or (B) a
change since the Effective Date in official reserve requirements, but, in
all events, excluding reserves required under Regulation D to the extent
included in the computation of the Eurodollar Rate and/or (y) other
circumstances affecting such Bank, the interbank Eurodollar market or the
position of such Bank in such market; or
(iii) at any time since the Effective Date, that the making or
continuance of any Eurodollar Loan has become unlawful by compliance by
such Bank in good faith with any law, governmental rule, regulation,
guideline or order (or would conflict with any such governmental rule,
regulation, guideline or order not having the force of law but with which
such Bank customarily complies even though the failure to comply therewith
would not be unlawful), or has become impracticable as a result of a
contingency occurring after the Effective Date which materially and
adversely affects the interbank Eurodollar market;
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then, and in any such event, such Bank (or the Administrative Agent in the case
of clause (i) above) shall (x) on such date and (y) within 10 Business Days of
the date on which such event no longer exists give notice (by telephone
confirmed in writing) to the Company and (except in the case of clause (i)) to
the Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Banks). Thereafter (x) in
the case of clause (i) above, Eurodollar Loans shall no longer be available
until such time as the Administrative Agent notifies the Company and the Banks
that the circumstances giving rise to such notice by the Administrative Agent
no longer exist, and any Notice of Borrowing or Notice of Conversion given by
the Company with respect to Eurodollar Loans which have not yet been incurred
shall be deemed rescinded by the Company, (y) in the case of clause (ii) above,
the Company agrees to pay to such Bank, upon written demand therefor
(accompanied by the written notice referred to below), such additional amounts
(in the form of an increased rate of, or a different method of calculating,
interest or otherwise as such Bank in its sole discretion shall determine) as
shall be required to compensate such Bank for such increased costs or
reductions in amounts received or receivable hereunder (a written notice as to
the additional amounts owed to such Bank, showing the basis for the calculation
thereof, submitted to the Company by such Bank shall, absent manifest error, be
final and conclusive and binding upon all parties hereto) and (z) in the case
of clause (iii) above, the Company shall take one of the actions specified in
Section 1.10(b) as promptly as possible and, in any event, within the time
period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Company may (and in
the case of a Eurodollar Loan affected pursuant to Section 1.10(a)(iii) the
Company shall) either (i) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, cancel said Borrowing by giving the Administrative
Agent telephonic notice (confirmed promptly in writing) thereof promptly (but in
any event no later than the later of (x) the Business Day next preceding the
date of such Borrowing and (y) one Business Day after the Company was notified
by a Bank pursuant to Section 1.10(a)(ii) or (iii)), or (ii) if the affected
Eurodollar Loan is then outstanding, upon at least three Business Days' notice
to the Administrative Agent, require the affected Bank to convert each such
Eurodollar Loan into a Base Rate Loan (which conversion, in the case of the
circumstances described in Section 1.10(a)(iii), shall occur no later than the
last day of the Interest Period then applicable to such Eurodollar Loan (or such
earlier date as shall be required by applicable law)); provided that if more
than one Bank is affected at any time, then all affected Banks must be treated
the same pursuant to this Section 1.10(b).
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(c) (i) If any Bank shall have determined that after the
Effective Date, the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Bank with any request or
directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank or comparable agency, has or would have
the effect of reducing the rate of return on such Bank's capital or assets as
a consequence of its commitments or obligations hereunder to a level below
that which such Bank could have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy), then from time to time, within 15 days after demand by
such Bank (with a copy to the Administrative Agent), accompanied by the
notice referred to in the last sentence of this clause (i), the Company shall
pay to such Bank such additional amount or amounts as will compensate such
Bank for such reduction. Each Bank, upon determining in good faith that any
additional amounts will be payable pursuant to this Section 1.10(c), will
give prompt written notice thereof to the Company, which notice shall set
forth the basis of the calculation of such additional amounts, although the
failure to give any such notice shall not release or diminish the Company's
obligations to pay additional amounts pursuant to this Section 1.10(c).
(ii) If (x) any Bank becomes a Defaulting Bank or otherwise defaults
in its obligations to make Loans, (y) any Bank has notified the Company that one
of its Eurodollar Loans is affected by the circumstances described in Section
1.10(a)(ii) or (iii), or (z) any Bank is owed increased costs or other amounts
under Section 1.10(c)(i) or 3.04 and, in the case of such clause (y) or (z),
compensation or other action with respect to such event is not otherwise
requested generally by the other Banks, the Company shall have the right, if no
Default or Event of Default then exists and, in the case of a Bank described in
clause (y) or (z) above, such Bank has not changed its applicable lending office
with the effect of eliminating such increased cost, to replace such Bank (the
"Replaced Bank") with another commercial bank or banks or other financial
institutions (collectively, the "Replacement Bank") reasonably acceptable to the
Administrative Agent, provided that (i) at the time of any replacement pursuant
to this Section 1.10(c)(ii), the Replacement Bank shall enter into one or more
assignment agreements pursuant to Section 11.04(b) hereof (and with all fees
payable pursuant to said Section 11.04(b) to be paid by the Replacement Bank)
pursuant to which the Replacement Bank shall acquire all of the Revolving Loan
Commitments, if prior to the Conversion Date, and outstanding Loans of the
Replaced Bank and, in connection therewith, shall pay to the Replaced Bank in
respect thereof an amount equal to the sum of (a) an amount equal to the
principal of, and all accrued interest on, all outstanding Loans of the Replaced
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Bank and (b) an amount equal to all accrued, but theretofore unpaid, Fees owing
to the Replaced Bank pursuant to Section 2.01 hereof and (ii) all obligations of
the Company owing to the Replaced Bank (other than those specifically described
in clause (i) above in respect of which the assignment purchase price has been,
or is concurrently being, paid) shall be paid in full to such Replaced Bank
concurrently with such replacement. Upon the execution of the respective
assignment documentation pursuant to clause (i) above and the payment of amounts
referred to in clauses (i) above and (ii) above, the Replacement Bank shall
become a Bank or Banks hereunder, as the case may be, and the Replaced Bank
shall cease to constitute a Bank hereunder, except with respect to
indemnification provisions (including, without limitation, Sections 1.10, 1.11,
3.04, 10.07 and 11.01 of this Agreement) under this Agreement, which shall
survive as to such Replaced Bank.
1.11 Compensation. The Company agrees to compensate each Bank in the
appropriate currency, upon its written request (which request shall set forth
the basis for requesting such compensation), for all reasonable losses, expenses
and liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other funds
required by such Bank to fund its Eurodollar Loans but excluding loss of
anticipated profit with respect to any Loans) which such Bank may sustain: (i)
if for any reason (other than a default by such Bank or the Administrative
Agent) a Borrowing of Eurodollar Loans does not occur on a date specified
therefor in a Notice of Borrowing or Notice of Conversion (whether or not
withdrawn by the Company or deemed withdrawn pursuant to Section 1.10(a)); (ii)
if any repayment, prepayment or conversion of any Eurodollar Loans occurs on a
date which is not the last day of an Interest Period applicable thereto; (iii)
if any prepayment of any Eurodollar Loans is not made on any date specified in a
notice of prepayment given by the Company; or (iv) as a consequence of (x) any
other default by the Company to repay its Loans when required by the terms of
this Agreement or (y) an election made pursuant to Section 1.10(b). Calculation
of all amounts payable to a Bank under this Section 1.11 shall be made as though
that Bank had actually funded its relevant Eurodollar Loan through the purchase
of a Eurodollar deposit bearing interest at the Eurodollar Rate in an amount
equal to the amount of that Loan, having a maturity comparable to the relevant
Interest Period and through the transfer of such Eurodollar deposit from an
offshore office of that Bank to a domestic office of that Bank in the United
States of America; provided, however, that each Bank may fund each of its
Eurodollar Loans in any manner it sees fit and the foregoing assumption shall be
utilized only for the calculation of amounts payable under this Section 1.11.
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1.12 Change of Lending Office. Each Bank agrees that, upon the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c)(i) or 3.04 with respect to such Bank, it will, if
requested by the Company, use reasonable efforts (subject to overall policy
considerations of such Bank) to designate another lending office for any Loans
affected by such event; provided that such designation is made on such terms
that in the sole judgment of such Bank, such Bank and its lending office suffer
no economic, legal or regulatory disadvantage, with the object of avoiding the
consequences of the event giving rise to the operation of any such Section.
Nothing in this Section 1.12 shall affect or postpone any of the obligations of
the Company or the right of any Bank provided in Sections 1.10 or 3.04.
SECTION 2. Fees; Commitments.
2.01 Fees. (a) The Company agrees to pay to the Administrative Agent
for distribution to each Non-Defaulting Bank with a Revolving Loan Commitment a
commitment fee (the "Commitment Fee") for the period from the Effective Date to
but not including the earlier of (x) the date the Total Revolving Loan
Commitment has been terminated and (y) the Conversion Date, computed at a per
annum rate equal to the Applicable Commitment Fee Percentage on the daily
average Aggregate Unutilized Revolving Loan Commitment of such Non-Defaulting
Bank. Accrued Commitment Fees shall be due and payable quarterly in arrears on
the last Business Day of March, June, September and December of the year
following the Effective Date and the earlier of (x) the date upon which the
Total Revolving Loan Commitment is terminated and (y) the Conversion Date.
(b) The Company shall pay to the Administrative Agent, for its own
account, such other fees as have been agreed to in writing by the Company and
the Administrative Agent.
(c) All computations of Fees shall be made in accordance with
Section 11.07(b).
2.02 Voluntary Reduction of Commitments. At any time prior to the
Conversion Date, upon at least three Business Days' prior written notice (or
telephonic notice promptly confirmed in writing) to the Administrative Agent at
its Notice Office (which notice the Administrative shall promptly transmit to
each of the Banks), the Company shall have the right, without premium or
penalty, to terminate or partially reduce the Total Unutilized Revolving Loan
Commitment; provided that (x) any such
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termination or partial reduction shall apply to proportionately and
permanently reduce the Revolving Loan Commitment of each of the Banks, (y)
any partial reduction pursuant to this Section 2.02 shall be in the amount of
at least $2,000,000, (z) the reduction to the Total Unutilized Revolving Loan
Commitment shall in no case be in an amount which would cause the Revolving
Loan Commitment of any Bank to be reduced (as required by the preceding
clause (x)) by an amount which exceeds the remainder of the Aggregate
Unutilized Revolving Loan Commitment of such Bank as in effect immediately
before giving effect to such reduction.
2.03 Mandatory Reduction of Commitments, etc. (a) The Total
Revolving Loan Commitment (and the Revolving Loan Commitment of each Bank) shall
terminate in its entirety on the earlier of (i) the date which is the earlier of
(x) 30 days after any date on which a Specified Change of Control Event occurs
and (y) the date on which any Senior Notes or any other Indebtedness of the
Company or its Restricted
Subsidiaries are required to be repurchased, redeemed or prepaid as a result of
any such Specified Change of Control Event and (ii) 9:00 a.m. (New York time) on
the Conversion Date.
(b) With respect to any Asset Sale, (i) on the earliest of (x) the
date occurring one year after the consummation of such Asset Sale, (y) the date,
if any, following the date of consummation of such Asset Sale upon which the
Administrative Agent, on behalf of the Required Banks, shall have delivered a
written reinvestment termination notice to the Company, provided that such
notice may only be given while an Event of Default exists, and (z) the date the
Company or any of its Subsidiaries shall be required to make an offer to
purchase Senior Notes or any other Indebtedness of the Company or its Restricted
Subsidiaries (other than Indebtedness specifically relating to the assets sold
in such Asset Sale) with the proceeds received in connection with such Asset
Sale, and (ii) on any date after the earliest of the dates referred to in clause
(i) above of receipt by the Company or any of its Restricted Subsidiaries of
additional Net Cash Proceeds from such Asset Sale, in each case, (x) if prior to
the Conversion Date, the Total Revolving Loan Commitment shall be reduced and
(y) if the Conversion Date has occurred, the aggregate principal amount of Term
Loans shall be repaid, in each such case, in an aggregate amount equal to the
Applicable Percentage of the then Remaining Net Cash Proceeds from such Asset
Sale.
(c) Each reduction to the Total Revolving Loan Commitment pursuant
to this Section 2.03 shall be applied proportionately to reduce the Revolving
Loan Commitment of each Bank.
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SECTION 3. Payments.
3.01 Voluntary Prepayments. The Company shall have the right to
prepay the Loans incurred by it, in whole or in part, without premium or
penalty except as otherwise provided in this Agreement, from time to time on
the following terms and conditions: (i) the Company shall give the
Administrative Agent at the Notice Office written notice (or telephonic
notice promptly confirmed in writing) of its intent to prepay the Loans, the
amount of such prepayment and (in the case of Eurodollar Loans) the specific
Borrowing(s) pursuant to which made, which notice shall be given by the
Company prior to 12:00 Noon (New York time) at least two Business Days prior
to the date of such prepayment, which notice shall promptly be transmitted by
the Administrative Agent to each of the Banks; (ii) each partial prepayment
of any Borrowing shall be in an aggregate principal amount of at least
$1,000,000 and, if greater, in an integral multiple of $500,000, provided
that no partial prepayment of Eurodollar Loans made pursuant to a Borrowing
shall reduce the aggregate principal amount of the Loans outstanding pursuant
to such Borrowing to an amount less than the Minimum Borrowing Amount
applicable thereto; (iii) each prepayment of Term Loans pursuant to this
Section 3.01 shall reduce the then remaining Scheduled TL Repayments on a pro
rata basis (based upon the then remaining principal amount of each such
Scheduled TL Repayment); and (iv) each prepayment in respect of any Loans
made pursuant to a Borrowing shall be applied pro rata among such Loans;
provided that at the Company's election in connection with any prepayment of
Revolving Loans pursuant to this Section 3.01, such prepayment shall not be
applied to any Revolving Loans of a Defaulting Bank.
3.02 Mandatory Repayments. (a) (i) If on any date the aggregate
outstanding principal amount of Revolving Loans made by Non-Defaulting Banks (in
each case after giving effect to all other repayments thereof on such date)
exceeds the Adjusted Total Commitment as then in effect, the Company shall repay
on such date the principal of Revolving Loans of Non-Defaulting Banks in an
aggregate amount equal to such excess.
(ii) If on any date the aggregate outstanding principal amount of
Revolving Loans made by any Defaulting Bank exceeds the Revolving Loan
Commitment of such Defaulting Bank, the Company shall repay the Revolving Loans
of such Defaulting Bank in an amount equal to such excess.
(b) In addition to any other mandatory repayments pursuant to this
Section 3.02, the Company shall repay, on each date set forth below (provided
that if any
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date set forth below is not a Business Day then the repayment shall
occur on the first Business Day immediately succeeding such date set forth
below) (each a "Scheduled TL Repayment Date"), the Term Loans in an amount equal
to the product of (x) the aggregate principal amount of Revolving Loans
converted to Term Loans on the Conversion Date pursuant to Section 1.01(b)
hereof multiplied by (y) the percentage set forth below opposite such date (each
such repayment, as the same may be reduced as provided in Sections 3.01, and
3.02(d), a "Scheduled TL Repayment"):
Scheduled TL Repayment Date Percentage
--------------------------- ----------
June 30, 2000 10%
December 31, 2000 10%
June 30, 2001 10%
December 31, 2001 10%
June 30, 2002 10%
December 31, 2002 10%
June 30, 2003 10%
December 31, 2003 10%
June 30, 2004 20%
(c) In the event that a Specified Change of Control Event occurs,
the Company shall repay all outstanding Term Loans in their entirety on the date
which is the earlier of (i) 30 days after any date on which such Specified
Change of Control Event occurs and (ii) the date on which any Senior Notes or
any other Indebtedness of the Company or its Restricted Subsidiaries are
required to be repurchased, redeemed or prepaid as a result of any such
Specified Change of Control Event.
(d) The aggregate principal amount of Term Loans shall be repaid at
the times, and in the amounts, provided in Section 2.03(b). The amount of each
principal repayment of Term Loans pursuant to this Section 3.02(d) shall be
applied to reduce each of the remaining Scheduled TL Repayments on a pro rata
basis (based upon the then remaining amount of each such Scheduled TL
Repayment).
(e) Notwithstanding anything to the contrary contained in this
Agreement, all then outstanding Term Loans under this Agreement shall be repaid
in full on the Final Maturity Date.
(f) With respect to each repayment of Loans required by this Section
3.02, the Company may designate the Types of Loans which are to be repaid and
the
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specific Borrowing(s) pursuant to which made; provided that (i) Eurodollar
Loans may be designated for repayment pursuant to this Section 3.02 only on
the last day of an Interest Period applicable thereto unless all Eurodollar
Loans with Interest Periods ending on such date of required repayment and all
Base Rate Loans have been paid in full; (ii) each repayment of any Loans made
pursuant to a Borrowing shall be applied pro rata among such Loans; (iii)
notwithstanding the provisions of the preceding clause (ii), no repayment of
Revolving Loans pursuant to Section 3.02(a)(i) shall be applied to the
Revolving Loans of a Defaulting Bank; and (iv) repayments of Revolving Loans
of Defaulting Banks pursuant to Section 3.02(a)(ii) shall be applied pro rata
among such Revolving Loans. In the absence of a designation by the Company as
described in the preceding sentence, the Administrative Agent shall, subject
to the above, make such designation in its sole discretion with a view, but
no obligation, to minimize breakage costs owing under Section 1.11.
Notwithstanding the foregoing provisions of this Section 3.02, if at any time
the mandatory repayment of Loans pursuant to Section 3.02(a) or (b) arising
solely as a result of a reduction to the Revolving Loan Commitment pursuant
to Section 2.03(b) would result, after giving effect to the procedures set
forth above in this clause (f), in the Company incurring breakage costs under
Section 1.11 as a result of Eurodollar Loans being repaid other than on the
last day of an Interest Period applicable thereto (the "Affected Eurodollar
Loans"), then the Company may in its sole discretion initially deposit a
portion (up to 100%) of the amounts that otherwise would have been paid in
respect of the Affected Eurodollar Loans with the Administrative Agent to be
held as security for the obligations of the Company hereunder pursuant to a
cash collateral agreement to be entered into in form and substance
satisfactory to the Administrative Agent, with such cash collateral to be
released from such cash collateral account upon the first occurrence (or
occurrences) thereafter of the last day of an Interest Period applicable to
the relevant Loans that are Eurodollar Loans (or such earlier date or dates
as shall be requested by the Company), to repay an aggregate principal amount
of such Loans equal to the Affected Eurodollar Loans not initially repaid
pursuant to this sentence.
3.03 Method and Place of Payment. Except as otherwise specifically
provided herein, all payments under this Agreement shall be made to the
Administrative Agent for the ratable account of the Banks entitled thereto
(based on each Bank's Pro Rata Share, if any), no later than 1:00 P.M. (New York
time) on the date when due and shall be made in immediately available funds and
in lawful money of the United States of America at the Payment Office. Any
payments under this Agreement which are made later than 1:00 P.M. (New York
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time) shall be deemed to have been made on the next succeeding Business Day;
provided, however, that to the extent that the Administrative Agent shall have
received any payment under this Agreement after 1:00 P.M. (New York time) on a
Business Day, the Administrative Agent shall use its best efforts to distribute
such payment as promptly as practicable on such date to the Banks (other than
any Bank that has consented in writing to waive its pro rata share of such
payment) pro rata based upon their respective shares, if any, of the Obligations
with respect to which such payment was received, and to the extent that any such
Bank receives its portion of such payment from the Administrative Agent on such
same date by a time satisfactory to such Bank, such payment to such Bank shall
be deemed to have been made on such date. Whenever any payment to be made
hereunder shall be stated to be due on a day which is not a Business Day, the
due date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable during such
extension at the applicable rate in effect immediately prior to such extension.
3.04 Net Payments. All payments made by the Company hereunder will
be made without setoff, counterclaim or other defense. Promptly upon notice from
any Bank to the Company, the Company agrees to pay, prior to the date on which
penalties attach thereto, all present and future income, stamp and other taxes,
levies, or costs and charges whatsoever imposed, assessed, levied or collected
on or in respect of a Loan solely as a result of the interest rate being
determined by reference to the Eurodollar Rate, and/or the provisions of this
Agreement relating to the Eurodollar Rate, and/or the recording, registration,
notarization or other formalization of any thereof and/or any payments of
principal, interest or other amounts made on a Loan when the interest rate is
determined by reference to the Eurodollar Rate (all such taxes, levies, costs
and charges being herein collectively called "Taxes"); provided that Taxes shall
not include (x) taxes imposed on or measured by the overall net income or
receipts of the Administrative Agent or any Bank by the United States of America
or any political subdivision or taxing authority thereof or therein or (y) taxes
on or measured by the overall net income of any foreign office, branch or
subsidiary of the Administrative Agent or that Bank by any foreign country or
subdivision thereof in which the Administrative Agent's or that Bank's office,
branch or subsidiary is doing business. The Company agrees to also pay such
additional amounts equal to increases in taxes payable by that Bank described in
the foregoing proviso which increases arise solely from the receipt by that Bank
of payments made by the Company described in the immediately preceding sentence
of this Section 3.04. Promptly after the date on which payment of any such Tax
is due pursuant to applicable law, the Company will, at the request of that
Bank, furnish to that Bank evidence, in form and substance satisfactory to that
Bank, that the Company has met its obligation under this Section 3.04. The
Company agrees to indemnify each Bank against, and reimburse each Bank on demand
for, any Taxes, as reasonably determined by that Bank in its good faith. Such
Bank shall provide the Company with appropriate receipts for any payments or
reimbursements made by the Company pursuant
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to this Section 3.04. Notwithstanding the foregoing, the Company shall be
entitled, to the extent it is required to do so by law, to deduct or withhold
and pay to the appropriate taxing authority within the time prescribed by
applicable law (and shall not be required to make payments as otherwise
required in this Section on account of such deductions or withholdings)
income or other similar taxes imposed by the United States of America from
interest, fees or other amounts payable hereunder for the account of the
Administrative Agent or any Bank other than the Administrative Agent or any
Bank (i) who is a U.S. Person for Federal income tax purposes or (ii) who has
the Prescribed Forms on file with the Company for the applicable year to the
extent deduction or withholding of such taxes is not required as a result of
the filing of such Prescribed Forms, provided that if the Company shall so
deduct or withhold any such taxes, it shall provide a statement to the
Administrative Agent and such Bank, setting forth the amount of such taxes so
deducted or withheld, the applicable rate and any other information or
documentation which the Administrative Agent or such Bank may reasonably
request for assisting the Administrative Agent or such Bank to obtain any
allowable credits or deductions for the taxes so deducted or withheld in the
jurisdiction or jurisdictions in which the Administrative Agent or such Bank
is subject to tax.
SECTION 4. Conditions Precedent. The obligation of each Bank to make
each Loan to the Company hereunder is subject, at the time of the making of each
such Loan (except as otherwise hereinafter indicated), to the satisfaction of
the following conditions:
4.01 Execution of Agreement. On or prior to the Initial Borrowing
Date, this Agreement shall have been executed and delivered in accordance with
Section 11.10.
4.02 No Default; Representations and Warranties. At the time of the
making of each Loan and also after giving effect thereto (i) there shall exist
no Default or Event of Default and (ii) all representations and warranties
contained herein or in the other Credit Documents in effect at such time shall
be true and correct in all material respects with the same effect as though such
representations and warranties had been made on and as of the date of such Loan,
unless stated to relate to a specific earlier date, in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date.
4.03 Opinions of Counsel. On the Effective Date, the Administrative
Agent shall have received opinions, addressed to each of the Banks and dated the
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Effective Date, (i) from Simpson, Thacher & Bartlett, special counsel to the
Credit Parties, which opinion shall cover the matters contained in Exhibit B-1
and such other matters incident to the transactions contemplated herein as the
Administrative Agent may reasonably request, (ii) from Beverly C. Chell, Esq.,
counsel to the Credit Parties, which opinion shall cover the matters contained
in Exhibit B-2 and such other matters incident to the transactions contemplated
herein as the Administrative Agent may reasonably request, and (iii) from White
& Case, special counsel to the Administrative Agent, which opinion shall cover
the matters contained in Exhibit B-3.
4.04 Corporate Proceedings. (a) On the Effective Date, the
Administrative Agent shall have received from the Company and each Subsidiary
Guarantor, a certificate, dated the Effective Date, signed by the chairman, a
vice chairman, the president, any vice-president or the treasurer of such
Person, and attested to by the secretary or any assistant secretary of such
Person, in the form of Exhibit C with appropriate insertions and, to the
extent required, together with copies of the Certificate of Incorporation,
By-Laws and the resolutions of such Person referred to in such certificate,
and the foregoing shall be satisfactory to the Administrative Agent.
(b) On the Effective Date, all corporate and legal proceedings and
all instruments and agreements in connection with the transactions contemplated
by this Agreement and the other Credit Documents shall be reasonably
satisfactory in form and substance to the Administrative Agent, and the
Administrative Agent shall have received all information and copies of all
certificates, documents and papers, including good standing certificates and any
other records of corporate proceedings and governmental approvals, if any, which
the Administrative Agent reasonably may have requested in connection therewith,
such documents and papers, where appropriate, to be certified by proper
corporate or governmental authorities.
4.05 Existing Credit Agreements. On or prior to the Initial
Borrowing Date, the commitments under the Existing Credit Agreements shall have
been terminated, all loans thereunder shall have been repaid in full, together
with interest thereon, all letters of credit issued thereunder shall have been
terminated or incorporated as Letters of Credit under (and as defined in) the
Additional Credit Agreement, and all other amounts owing pursuant to the
Existing Credit Agreements shall have been repaid in full, and the
Administrative Agent shall have received evidence in form, scope and substance
satisfactory to it that the matters set forth in this Section 5.04 have been
satisfied at such time.
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4.06 Subsidiary Guaranty. On the Effective Date, each Subsidiary
Guarantor shall have duly authorized, executed and delivered a guaranty in the
form of Exhibit D hereto (as amended, modified or supplemented from time to time
in accordance with the terms hereof and thereof, the "Subsidiary Guaranty"), and
the Subsidiary Guaranty shall be in full force and effect.
4.07 Notice of Borrowing. The Administrative Agent shall have
received a Notice of Borrowing satisfying the requirements of Section 1.03 with
respect to any Borrowing of Revolving Loans.
4.08 Payment of Fees, etc. On the Effective Date, all costs, fees
and expenses, and all other compensation contemplated by this Agreement, due to
the Administrative Agent or the Banks shall have been paid to the extent due.
4.09 Contribution Agreement. On the Effective Date, the
Subsidiary Guarantors shall have entered into a contribution agreement in the
form of Exhibit E hereto (as amended, modified or supplemented from time to
time in accordance with the terms hereof and thereof, the "Contribution
Agreement"), and the Contribution Agreement shall be in full force and effect.
4.10 Existing Indebtedness Agreements. On or prior to the Initial
Borrowing Date, there shall have been delivered to (or made available for review
by) the Banks copies, certified (in the case of those delivered) as true and
correct by an appropriate officer of the Company making such delivery, of all
agreements evidencing or relating to the Existing Debt or the Existing
Contingent Obligations with respect to Indebtedness for borrowed money
(collectively, the "Existing Indebtedness Agreements").
4.11 Additional Credit Agreement. On or prior to the Initial
Borrowing Date, a Borrowing under (and as defined in) the Additional Credit
Agreement shall have occurred.
The acceptance of the benefits of each Loan shall constitute a
representation and warranty by the Company to each of the Banks that all of the
applicable conditions specified above exist as of the date of such Loan. All of
the certificates, legal opinions and other documents and papers referred to in
this Section 4, unless otherwise specified, shall be delivered to the
Administrative Agent at its Notice Office for the account of each of the Banks
and in sufficient counterparts for each of the
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Banks and shall be reasonably satisfactory in form and substance to the
Administrative Agent.
SECTION 5. Representations, Warranties and Agreements. In order to
induce the Banks to enter into this Agreement and to make the Loans provided for
herein, the Company makes the following representations and warranties to, and
agreements with, the Banks, all of which shall survive the execution and
delivery of this Agreement, the making of the Loans (with the making of each
Loan on and after the Initial Borrowing Date being deemed to constitute a
representation and warranty that the matters specified in this Section 5 are
true and correct in all material respects on and as of the Initial Borrowing
Date and as of the date of each such Loan, unless stated to relate to a specific
earlier date):
5.01 Corporate Status. The Company and each of its Restricted
Subsidiaries (i) is a duly organized and validly existing corporation under
the laws of the jurisdiction of its organization and has the corporate power
and authority to own its property and assets and to transact the business in
which it is engaged and presently proposes to engage, (ii) is in good
standing under the laws of the jurisdiction of its organization and (iii) is
duly qualified and is authorized to do business and is in good standing in
all jurisdictions where it is required to be so qualified, except, in the
cases of clauses (ii) and (iii) above, for such failures to be in good
standing and failures to be so qualified which, in the aggregate, would not
have a material adverse effect on the condition (financial or otherwise),
operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole.
5.02 Corporate Power and Authority. Each of the Company and each of
its Restricted Subsidiaries has the corporate power and authority to execute,
deliver and carry out the terms and provisions of the Credit Documents to which
it is a party and has taken all necessary corporate action to authorize the
execution, delivery and performance of the Credit Documents to which it is a
party. Each of the Company and each of its Restricted Subsidiaries has duly
executed and delivered each Credit Document to which it is a party and each such
Credit Document constitutes the legal, valid and binding obligation of such
Person enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws generally affecting creditors' rights
and by equitable principles (regardless of whether enforcement is sought in
equity or at law).
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5.03 No Violation. Neither the execution, delivery or performance by
the Company or any of its Restricted Subsidiaries of the Credit Documents to
which it is a party nor compliance by them with the terms and provisions
thereof, nor the consummation of the transactions contemplated therein (i) will
contravene in any material respect any applicable provision of any law, statute,
rule or regulation, or any order, writ, injunction or decree of any court or
governmental instrumentality, (ii) will conflict or be inconsistent with or
result in any breach of, any of the terms, covenants, conditions or provisions
of, or constitute a default under, or result in the creation or imposition of
(or the obligation to create or impose) any Lien upon any of the property or
assets of the Company or any of its Subsidiaries pursuant to the terms of any
indenture, mortgage, deed of trust, credit agreement, loan agreement or other
material agreement or instrument to which the Company or any of its Subsidiaries
is a party or by which any of them or any of their respective property or assets
is bound or to which it may be subject or (iii) will violate any provision of
the Certificate of Incorporation or ByLaws of the Company or any of its
Subsidiaries.
5.04 Litigation. There are no actions, suits or proceedings
pending, or, to the best knowledge of the Company, threatened, with respect
to the Company or any of its Subsidiaries (i) that are likely to have a
material adverse effect on the condition (financial or otherwise),
operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole or (ii) that could reasonably be
expected to have a material adverse effect on the rights or remedies of the
Banks or the Administrative Agent or on the ability of the Company or of the
Subsidiary Guarantors, taken as a whole, in either case, to perform its or
their respective obligations hereunder and under the other Credit Documents
to which it is or they are, or will be, a party.
5.05 Use of Proceeds; Margin Regulations. (a) The proceeds of all
Loans shall be used for general corporate and working capital purposes of the
Company and its Subsidiaries (including, without limitation, to finance
Permitted Acquisitions and refinance Senior Notes).
(b) Neither the making of any Loan hereunder, nor the use of the
proceeds thereof, will violate the provisions of Regulation G, T, U or X of the
Board of Governors of the Federal Reserve System and no part of the proceeds of
any Loan will be used to purchase or carry any Margin Stock or to extend credit
for the purpose of purchasing or carrying any Margin Stock, provided that the
Company may use the proceeds of Loans to purchase Margin Stock in compliance
with Regulations G, T, U and X, so long as at the time of the making of such
Loan, and after giving effect thereto, not more than 25% of the value of the
assets subject to the provisions of Section 7 of the
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Company, or of the Company and its Restricted Subsidiaries on a consolidated
basis, shall constitute Margin Stock.
5.06 Governmental Approvals. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to authorize or is required in
connection with (i) the execution, delivery and performance of any Credit
Document or (ii) the legality, validity, binding effect or enforceability of any
Credit Document, except those which have been obtained or made or those the
absence of which, individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on either (x) the condition
(financial or otherwise), operations, assets, liabilities or prospects of the
Company and its Restricted Subsidiaries taken as a whole or (y) the rights or
remedies of the Banks or the Administrative Agent or on the ability of the
Company or of the Subsidiary Guarantors, taken as a whole, in either case, to
perform its or their respective obligations hereunder and under the other Credit
Documents to which it is or they are, or will be, a party.
5.07 Investment Company Act. Neither the Company nor any of its
Restricted Subsidiaries is an "investment company" or a company "controlled" by
an "investment company," within the meaning of the Investment Company Act of
1940, as amended.
5.08 Public Utility Holding Company Act. Neither the Company nor any
of its Restricted Subsidiaries is a "holding company," or a "subsidiary company"
of a "holding company," or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
5.09 True and Complete Disclosure. (a) All factual information
(taken as a whole) heretofore or contemporaneously furnished by the Company or
any of its Subsidiaries in writing to the Administrative Agent and/or any Bank
on or before the Initial Borrowing Date (including, without limitation, (i) the
Information Memorandum and (ii) all information contained in the Credit
Documents) for purposes of or in connection with this Agreement or any
transaction contemplated herein is true and complete in all material respects on
the date as of which such information is dated or certified and not incomplete
by omitting to state any material fact necessary to make such information (taken
as a whole) not misleading at such time in light of the circumstances under
which such information was provided, it being understood and agreed that for
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purposes of this Section 5.09(a), such factual information shall not include
projections and pro forma financial information.
(b) The projections and pro forma financial information contained in
the factual information referred to in paragraph (a) above were based on good
faith estimates and assumptions believed by such Persons to be reasonable at the
time made, it being recognized by the Banks that such projections as to future
events are not to be viewed as facts and that actual results during the period
or periods covered by any such projections may differ from the projected
results.
5.10 Financial Statements; Financial Condition. (a) The consolidated
balance sheets of the Company and its Subsidiaries as at December 31, 1995 and
March 31, 1996 and the related consolidated statements of income and cash flows
of the Company and its Subsidiaries for the fiscal year or three-month period,
as the case may be, ended as of said dates, which, in the case of the December
31, 1995 statements, have been examined by Deloitte & Touche, independent
certified public accountants, who delivered an unqualified opinion in respect
thereof, present fairly the financial position of the Company and its
Subsidiaries at the dates of said statements and the results for the period
covered thereby. All such financial statements have been prepared in accordance
with GAAP consistently applied except to the extent provided in the notes to
said financial statements (subject, in the case of the March 31, 1996
statements, to normal year-end audit adjustments).
(b) Since December 31, 1995 and after giving effect to the
incurrence of Indebtedness hereunder and the other transactions contemplated
hereby, there has been no material adverse change in the condition (financial
or otherwise), operations, assets, liabilities or prospects of the Company
and its Restricted Subsidiaries taken as a whole (other than any change in
general economic conditions or any change in conditions affecting the
Business generally).
5.11 Tax Returns and Payments. Each of the Company and each of its
Restricted Subsidiaries has filed all Federal income tax returns and all other
material tax returns, domestic and foreign, required to be filed by it and has
paid all Federal taxes and assessments shown to be due on such returns and all
other material taxes and assessments, domestic and foreign, in each case payable
by it which have become due, other than those not yet delinquent and except for
those contested in good faith and for which adequate reserves have been provided
in accordance with GAAP.
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5.12 Compliance with ERISA. As of the Effective Date, there are
no Plans and neither the Company nor any of its Restricted Subsidiaries nor
any ERISA Affiliate has incurred any unpaid material liability or reasonably
expects to incur any material liability with respect to any "employee pension
benefit plan" (as defined in Section 3(2) of ERISA) covered by Title IV of
ERISA. As of the date of each subsequent Loan, each Plan is in substantial
compliance with ERISA and the Code; no Reportable Event has occurred with
respect to a Plan; no Plan is insolvent or in reorganization; no Plan has an
accumulated or waived funding deficiency, has permitted decreases in its
funding standard account or has applied for an extension of any amortization
period within the meaning of Section 412 of the Code; neither the Company nor
any of its Restricted Subsidiaries nor any ERISA Affiliate has incurred or
reasonably expects to incur any liability to or on account of a Plan pursuant
to ERISA or the Code; no proceedings have been instituted by the PBGC to
terminate any Plan; no condition exists which presents a material risk to the
Company, any of its Restricted Subsidiaries or any ERISA Affiliate of
incurring a liability to or on account of a Plan pursuant to ERISA or the
Code; no lien imposed under the Code or ERISA on the assets of the Company,
any of its Restricted Subsidiaries or any ERISA Affiliate exists or is likely
to arise on account of any Plan; and the Company and its Restricted
Subsidiaries do not maintain or contribute to any "employee welfare benefit
plan" (as defined in Section 3(1) of ERISA), which provides benefits to
retired employees (other than as required by Section 601 of ERISA) where,
with respect to any of the foregoing representations in this Section 5.12,
the liability for or the lien which could arise as a result of, the
particular circumstance or event which is the subject of the representation,
would be reasonably likely to result in a material adverse effect on the
condition (financial or otherwise), operations, assets, liabilities or
prospects of the Company and its Restricted Subsidiaries taken as a whole.
Using actuarial assumptions and computation methods consistent with subpart 1
of subtitle E of Title IV of ERISA, the aggregate liabilities of the Company,
its Restricted Subsidiaries and ERISA Affiliates to all Plans which are
"multiemployer plans" (as defined in Section 4001(a)(3) of ERISA) (each a
"Multiemployer Plan") in the event of a complete withdrawal therefrom, as of
the close of the most recent fiscal year of each such Plan would not be
reasonably likely to be an amount that could result in a material adverse
effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken
as a whole. Notwithstanding anything in this Section 5.12 to the contrary,
all representations and warranties made with respect to any Plan which is a
Multiemployer Plan shall be made to the best knowledge of the Company.
5.13 Subsidiaries. On the Effective Date, the corporations listed on
Annex III under the name of the Company are the only Subsidiaries of the
Company.
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Annex III correctly sets forth, as of the Effective Date, the percentage
ownership (direct and indirect) of the Company in each class of capital stock
of each of its Subsidiaries and also identifies the direct owner thereof.
5.14 Intellectual Property. (a) The Company and each of its
Restricted Subsidiaries owns, or is licensed or otherwise authorized to sell,
distribute, use or exploit, all material copyrights, literary works, texts and
other works of authorship fixed in any tangible medium of expression necessary
for the present conduct of its business ("Copyrights"), except to the extent
that the failure to own or obtain licenses or authorizations with respect to any
of the foregoing, individually or in the aggregate, would not have a material
adverse effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole.
(b) The Company and each of its Restricted Subsidiaries owns or is
licensed to use all the patents, trademarks, permits, service marks, trade
names, technology, know-how and formulas, or rights with respect to the
foregoing, necessary for the present conduct of its business, except to the
extent that the failure to own or obtain licenses with respect to any of the
foregoing, individually or in the aggregate, would not have a material adverse
effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole (together with the Copyrights, "Intellectual Property").
(c) All Intellectual Property is protected in all material
respects under the laws of the United States relating to such Intellectual
Property and has been duly and properly registered or filed with or issued by
the appropriate governmental offices and jurisdictions for such
registrations, filings or issuances, except to the extent that the failure to
make or obtain such registrations, filings or issuances would not have a
material adverse effect on the condition (financial or otherwise),
operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole.
(d) No material claim has been asserted by any Person challenging or
questioning the use of any such Intellectual Property or the validity or
effectiveness of any such Intellectual Property. The use of such Intellectual
Property by the Company or its Restricted Subsidiaries does not infringe on the
rights of any Person, except for such claims and infringements as do not,
individually or in the aggregate, give rise to any liabilities on the part of
the Company and its Restricted Subsidiaries that are material to the Company and
its Restricted Subsidiaries taken as a whole.
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5.15 Compliance with Statutes, etc. The Company and each of its
Restricted Subsidiaries is in compliance with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including compliance with all
applicable Environmental Laws with respect to any Real Property and the
requirements of any permits issued under such Environmental Laws with respect to
any such Real Property or the operations of the Company or any of its
Subsidiaries), except such noncompliances as would not, in the aggregate, have a
material adverse effect on the condition (financial or otherwise), operations,
assets, liabilities or prospects of the Company and its Restricted Subsidiaries
taken as a whole.
SECTION 6. Affirmative Covenants. The Company hereby covenants and
agrees that on the Effective Date and thereafter for so long as this Agreement
is in effect and until the Revolving Loan Commitments have terminated, no Notes
are outstanding and the Loans together with interest, Fees and all other
Obligations are paid in full:
6.01 Information Covenants. The Company will furnish to each Bank:
(a) Annual Financial Statements. Within 100 days after the close of
each fiscal year of the Company, the consolidated balance sheets of each
of (A) the Company and its Subsidiaries and of (B) the Company and its
Restricted Subsidiaries, as at the end of such fiscal year and, in each
case, the related consolidated statements of income and retained earnings
and of cash flows for such fiscal year, setting forth for such fiscal
year, in comparative form, the corresponding figures for the preceding
fiscal year and, in the case of the figures with respect to the Company
and its Restricted Subsidiaries the corresponding figures from the budget
for such fiscal year delivered pursuant to Section 6.01(c); all of which
shall be examined by Deloitte & Touche or such other independent certified
public accountants of recognized national standing as shall be acceptable
to the Administrative Agent, whose opinion shall not be qualified as to
the scope of audit or as to the status of the Company and its Subsidiaries
or of the Company and its Restricted Subsidiaries, as the case may be, as
a going concern, together with a certificate of such accounting firm
stating that in the course of its regular audit of the business of the
Company and its Subsidiaries, which audit was conducted in accordance
with generally accepted auditing standards, no Default or Event of
Default which has occurred and is continuing has come to its attention or,
if such a Default or Event of Default has come to its attention a
-26-
statement as to the nature thereof (provided that in no event shall such
accountants be liable as a result of this Agreement by reason of any
failure to obtain knowledge of any Default or Event of Default that
would not be disclosed in the course of their audit examination).
(b) Quarterly Financial Statements. As soon as available and in any
event within 50 days after the close of each of the first three quarterly
accounting periods in each fiscal year of the Company (beginning with the
quarterly accounting period ending June 30, 1996) and, at the sole option
of the Company, at any time prior to 100 days after the close of the
fourth quarterly accounting period in each fiscal year, the consolidated
balance sheet of each of (A) the Company and its Subsidiaries and of (B)
the Company and its Restricted Subsidiaries, as at the end of such
quarterly period and the related consolidated statements of income and
retained earnings and of cash flows for such quarterly period and for the
elapsed portion of the fiscal year ended with the last day of such
quarterly period; all of which shall be in reasonable detail and certified
by the chief financial officer or other Authorized Officer of the Company
that they fairly present the financial condition of the Company and its
Subsidiaries or of the Company and its Restricted Subsidiaries, as the
case may be, as of the dates indicated and the results of their operations
and changes in their cash flows for the periods indicated, subject to
changes resulting from audit and normal year-end audit adjustments.
(c) Budgets; etc. Not more than 90 days after the commencement of
each fiscal year of the Company, budgets of the Company and its Restricted
Subsidiaries in reasonable detail for each of the four fiscal quarters of
such fiscal year setting forth Consolidated EBITDA and consolidated sales
and setting forth, with appropriate discussion, the principal assumptions
upon which such budgets are based.
(d) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Section 6.01(a) and (b), a
certificate of the chief financial officer, controller or chief accounting
officer of the Company (i) to the effect that no Default or Event of
Default exists or, if any Default or Event of Default does exist,
specifying the nature and extent thereof, which certificate shall set
forth the calculations required to establish whether the Company and its
Subsidiaries were in compliance with the provisions of Sections 7.04(c),
7.05(d), 7.07 and Sections 7.09 through and including 7.11, as at the end
of such fiscal quarter or year, as the case may be and (ii) setting forth
the calculations
-27-
demonstrating (A) with respect to each Affected Transaction consummated
during the most recently ended fiscal quarter, that the Company was in
compliance, on a Pro Forma Basis, with Sections 7.09, 7.10 and 7.11 and
(B) with respect to each business sold (or deemed sold) pursuant to
Section 7.02(c) hereof, compliance by the Company with clause (iii) of
such Section 7.02(c). In addition, at the time of the delivery of the
financial statements provided for in Section 6.01(a) and (b), a
certificate of the chief financial officer, controller or chief accounting
officer of the Company setting forth the amount of, and calculations
required to establish the amount of, Excess Cash Flow for the respective
fiscal year or quarter.
(e) Notice of Default or Litigation. Promptly, and in any event
within three Business Days after any officer of the Company obtains
knowledge thereof, notice of (x) the occurrence of any event which
constitutes a Default or Event of Default, which notice shall specify the
nature thereof, the period of existence thereof and what action the
Company proposes to take with respect thereto and (y) the commencement of,
or threat of, or any significant development in, any litigation or
governmental proceeding pending against the Company or any of its
Subsidiaries which is likely to have a material adverse effect on the
condition (financial or otherwise), operations, assets, liabilities or
prospects of the Company and its Restricted Subsidiaries taken as a whole,
or the ability of the Company or of the Subsidiary Guarantors, taken as a
whole, in either case, to perform its or their respective obligations
hereunder or under any other Credit Document.
(f) Auditors' Reports. Promptly upon receipt thereof, a copy of each
report or "management letter" submitted to the Company or any of its
Subsidiaries by its independent accountants in connection with any annual,
interim or special audit made by them of the books of the Company or any
of its Subsidiaries.
(g) Other Information. Promptly upon transmission thereof, copies of
any filings and registrations with, and reports to, the SEC by the Company
or any of its Subsidiaries and, with reasonable promptness, such other
information or documents (financial or otherwise) as the Administrative
Agent on its own behalf or on behalf of the Required Banks may reasonably
request from time to time.
6.02 Books, Records and Inspections. The Company will, and will
cause each of its Restricted Subsidiaries to, permit, upon notice to the chief
financial
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officer or other Authorized Officer of the Company, officers and designated
representatives of the Administrative Agent or the Required Banks to visit
and inspect any of the properties or assets of the Company and any of its
Restricted Subsidiaries in whomsoever's possession, and to examine the books
of account of the Company and any of its Restricted Subsidiaries and discuss
the affairs, finances and accounts of the Company and of any of its
Restricted Subsidiaries with, and be advised as to the same by, their
officers and independent accountants, all at such reasonable times and
intervals and to such reasonable extent as the Administrative Agent or the
Required Banks may desire.
6.03 Payment of Taxes. The Company will pay and discharge, and will
cause each of its Restricted Subsidiaries to pay and discharge, all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits, or upon any properties belonging to it, prior to the date on
which material penalties attach thereto, and all lawful claims for sums that
have become due and payable which, if unpaid, might become a Lien not otherwise
permitted under Section 7.03(a) or charge upon any properties of the Company or
any of its Restricted Subsidiaries; provided that neither the Company nor any of
its Restricted Subsidiaries shall be required to pay any such tax, assessment,
charge, levy or claim which is being contested in good faith and by proper
proceedings if it has maintained adequate reserves with respect thereto in
accordance with GAAP.
6.04 Corporate Franchises. The Company will do, and will cause each
of its Restricted Subsidiaries to do, or cause to be done, all things necessary
to preserve and keep in full force and effect its existence and its rights,
franchises, licenses, permits and Intellectual Property rights except to the
extent its failures to do so would not, in the aggregate, have a material
adverse effect on the condition (financial or otherwise), operations, assets,
liabilities or prospects of the Company and its Restricted Subsidiaries taken as
a whole; provided, however, that any transaction permitted by Section 7.02 will
not constitute a breach of this Section 6.04.
6.05 Compliance with Statutes, etc. The Company will, and will
cause each of its Restricted Subsidiaries to, comply with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed
by, all governmental bodies, domestic or foreign, in respect of the conduct
of its business and the ownership of its property (including applicable
statutes, regulations, orders and restrictions relating to environmental
standards and controls) other than those the non-compliance with which would
not have a material adverse effect on the condition (financial or otherwise),
operations, assets, liabilities or prospects of the Company and its
Restricted Subsidiaries taken as a whole
-29-
or on the ability of the Company or of the Subsidiary Guarantors, taken as a
whole, in either case, to perform its or their obligations hereunder or under
any other Credit Document.
6.06 ERISA. As soon as possible and, in any event, within 30 days
after the Company, any of its Restricted Subsidiaries or any ERISA Affiliate
knows or could reasonably be expected to know of the occurrence of any of the
following and where it could reasonably be expected that a material liability of
the Company and its Restricted Subsidiaries and ERISA Affiliates, taken as a
whole, could result in connection therewith, the Company will deliver to each of
the Banks a certificate of the chief financial officer or other Authorized
Officer of the Company setting forth details as to such occurrence and such
action, if any, which the Company, such Restricted Subsidiary or such ERISA
Affiliate is required or proposes to take, together with any notices required or
proposed to be given to or filed with or by the Company, such Restricted
Subsidiary, such ERISA Affiliate, the PBGC, a Plan participant or the Plan
administrator with respect thereto: that a Reportable Event has occurred; that
an accumulated funding deficiency has been incurred or an application is
reasonably likely to be or has been made to the Secretary of the Treasury for a
waiver or modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code with respect to a Plan; that a Plan has been or is reasonably
likely to be terminated, reorganized, partitioned or declared insolvent under
Title IV of ERISA; that a Plan has an Unfunded Current Liability giving rise to
a lien under ERISA or the Code; that proceedings are reasonably likely to be or
have been instituted to terminate a Plan; that a proceeding has been instituted
pursuant to Section 515 of ERISA to collect a delinquent contribution to a Plan;
or that the Company, any of its Restricted Subsidiaries or any ERISA Affiliate
will or is reasonably likely to incur any liability (including any contingent or
secondary liability) to or on account of the termination of or withdrawal from a
Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409 or 502(i) or 502(1) of ERISA. At the request of any Bank, the
Company will deliver to such Bank a complete copy of the annual report (Form
5500) of each Plan required to be filed with the Internal Revenue Service.
6.07 End of Fiscal Years; Fiscal Quarters. The Company will, for
financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years to end on December 31 of each year and (ii) each
of its, and each of its Subsidiaries', fiscal quarters to end on March 31,
June 30, September 30 and December 31 of each year.
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6.08 Use of Proceeds. All proceeds of the Loans shall be used as
provided in Section 5.05.
6.09 Ownership of Subsidiaries. The Company will, at all times,
maintain, directly or indirectly, ownership of at least a majority of the
capital stock of its Restricted Subsidiaries, except to the extent 100% of the
capital stock owned by the Company or any Restricted Subsidiary of any such
Restricted Subsidiary is sold, transferred or disposed of in a transaction
permitted by Section 7.02(c) or (j) or any such Restricted Subsidiary is merged,
consolidated or liquidated in a transaction permitted by Section 7.02(e),
provided that the Company shall not be required to own a majority of the capital
stock of Canadian Sailings Inc. so long as the Company continues to hold at
least as much of such capital stock as is held on the Effective Date.
6.10 Maintenance of Corporate Separateness. The Company will, and
will cause each of its Subsidiaries to, satisfy customary corporate formalities,
including the holding of regular board of directors' and shareholders' meetings
and the maintenance of corporate offices and records. Neither the Company nor
any Restricted Subsidiary shall make any payment to a creditor of any
Unrestricted Subsidiary in respect of any liability of such Unrestricted
Subsidiary, and no bank account of an Unrestricted Subsidiary shall be
commingled with any bank account of the Company or any of its Restricted
Subsidiaries. Any financial statements distributed to any creditors of an
Unrestricted Subsidiary shall clearly establish the separateness of such
Unrestricted Subsidiary from the Company and its Restricted Subsidiaries.
Finally, neither the Company nor any of its Subsidiaries shall take any action,
or conduct its affairs in a manner, which is likely to result in the corporate
existence of any Unrestricted Subsidiary which is a direct Subsidiary of the
Company or any Restricted Subsidiary being ignored by any court of competent
jurisdiction, or in the assets and liabilities of the Company or any Restricted
Subsidiary being substantively consolidated with those of any Unrestricted
Subsidiary in a bankruptcy, reorganization or other insolvency proceeding.
SECTION 7. Negative Covenants. The Company hereby covenants and
agrees that as of the Effective Date, and thereafter for so long as this
Agreement is in effect and until the Revolving Loan Commitments have terminated,
no Notes are outstanding and the Loans, together with interest, Fees and all
other Obligations are paid in full:
7.01 Changes in Business. The Company will not, and will not permit
any of its Restricted Subsidiaries to, engage in any businesses other than
Businesses,
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provided that the Company and its Restricted Subsidiaries may engage
in businesses other than a Business so long as the businesses engaged in by the
Company and its Restricted Subsidiaries, taken as a whole, consist substantially
of Businesses.
7.02 Consolidation, Merger, Sale or Purchase of Assets, etc. The
Company will not, and will not permit any of its Restricted Subsidiaries to,
wind up, liquidate or dissolve its affairs or enter into any transaction of
merger or consolidation, or convey, sell, lease or otherwise dispose of (or
agree to do any of the foregoing at any future time) all or any part of its
property or assets, or enter into any partnerships, joint ventures or
sale-leaseback transactions, or purchase or otherwise acquire (in one or a
series of related transactions) any part of the property or assets (other than
purchases or other acquisitions of inventory, materials and equipment (and, to
the extent consistent with industry practices, other tangible and intangible
assets) in the ordinary course of business) of any Person, except that the
following shall be permitted:
(a) any sale, transfer or other disposition of (x) inventory in the
ordinary course of business or (y) any other tangible or intangible asset
in the ordinary course of business of the Company and/or its Restricted
Subsidiaries;
(b) the advances, investments and loans permitted pursuant to
Section 7.05;
(c) Asset Sales constituting the disposition of a business
(including, without limitation, to the extent permitted in this Section
7.02(c), sales of the capital stock of a Restricted Subsidiary but
excluding sales of the stock of an Unrestricted Subsidiary); provided that
(i) no Default or Event of Default exists at such time or would exist
immediately after giving effect thereto; (ii) such sale, transfer or
disposition (or deemed sale, transfer or disposition pursuant to any
Permitted Restricted Subsidiary Conversion) (x) is for fair market value,
as determined in good faith by management of the Company (or, in the case
of any Permitted Restricted Subsidiary Conversion or Permitted Restricted
Asset Sale, to the extent requested by the Administrative Agent or the
Required Banks, as determined by a written opinion of value reasonably
satisfactory to the Administrative Agent by an Appraisal Firm) and (y)
except in the case of a Permitted Restricted Subsidiary Conversion
otherwise permitted pursuant to the terms hereof, results in consideration
in the form of cash, promissory notes issued by the respective purchaser
and/or other assets, provided that, to the extent any such other assets
are received by the Company and/or its Restricted Subsidiaries in
connection with any such Asset Sale, (I) the market value of such
32
other assets, when added to the aggregate amount of other consideration
received in connection with such Asset Sale, shall equal or exceed the
market value of the assets so sold (such value to be set forth, to the
extent requested by the Administrative Agent or the Required Banks, in a
written opinion of value reasonably satisfactory to the Administrative
Agent by an Appraisal Firm) and (II) such assets are permitted to be
acquired by the Company or any of its Restricted Subsidiaries pursuant to
Section 7.02(g) at the time of consummation of such Asset Sale (both
before and after giving effect to such Asset Sale); (iii) the businesses
sold (or deemed sold pursuant to any Permitted Restricted Subsidiary
Conversion) by the Company and/or its Restricted Subsidiaries pursuant to
this Section 7.02(c) in any fiscal year of the Company shall not, in the
aggregate, have EBITDA in the immediately preceding fiscal year in an
amount in excess of 25% of the Consolidated EBITDA of the Company and its
Restricted Subsidiaries for such preceding fiscal year, determined on a
pro forma basis as if (A) any dispositions (or deemed dispositions
pursuant to any Permitted Restricted Subsidiary Conversion) consummated
during such preceding fiscal year had been consummated on the first day of
such preceding fiscal year and (B) any acquisitions consummated after the
beginning of such preceding fiscal year but prior to the date of any
proposed Asset Sale pursuant to this Section 7.02(c) had been consummated
on the first day of such preceding fiscal year; and (iv) to the extent
such sale, transfer or disposition constitutes a sale, transfer or
disposition of less than 100% of the capital stock of any Restricted
Subsidiary of the Company, after giving effect to such sale, transfer or
disposition, the Company shall own at least a majority of the capital
stock of such Restricted Subsidiary;
(d) Asset Sales constituting the disposition of the capital stock
owned by the Company and its Restricted Subsidiaries of Unrestricted
Subsidiaries;
(e) any Restricted Subsidiary may be merged or consolidated with or
into, or be liquidated into, the Company or any other Restricted
Subsidiary of the Company, or all or any part of its business, properties
and assets may be conveyed, leased, sold or otherwise transferred to the
Company or any other Restricted Subsidiary, provided that (v) in any such
merger or consolidation involving the Company, the Company shall be the
surviving corporation, (w) no Default or Event of Default exists or would
exist after giving effect thereto, (x) no Excluded Foreign Restricted
Subsidiary or Excluded Domestic Restricted Subsidiary may be the surviving
corporation of any such merger or consolidation (other than, in the case
of an Excluded Foreign Restricted Subsidiary, a merger or consolidation
with another Excluded Foreign Restricted Subsidiary and other
-33-
than, in the case of an Excluded Domestic Restricted Subsidiary, a merger
or consolidation with another Excluded Domestic Restricted Subsidiary),
(y) no businesses, properties or assets may be transferred to Excluded
Foreign Restricted Subsidiaries if after giving effect to such transfer
the Net Investments in Excluded Foreign Restricted Subsidiaries would
exceed $30,000,000 and (z) to the extent any business, properties or
assets are transferred to Excluded Domestic Restricted Subsidiaries in
connection with any such merger or consolidation the Company shall have
determined, with respect to such transaction, that the Company and its
Restricted Subsidiaries would have been in compliance, on a Pro Forma
Basis, with Sections 7.09, 7.10 and 7.11 of this Agreement;
(f) the Company and/or its Restricted Subsidiaries may lease real or
personal property (so long as such lease does not create Capitalized Lease
Obligations except as otherwise permitted by Section 7.04);
(g) so long as no Default or Event of Default exists or would result
therefrom, the Company and its Restricted Subsidiaries may acquire assets,
the capital stock of, or other ownership interests in, any Person (any
such acquisition permitted by this clause (g), a "Permitted Acquisition");
provided that (A) after giving effect to any such acquisition, the Company
and its Restricted Subsidiaries shall be in compliance with Section 7.01
hereof; (B) the Company shall have determined, with respect to such
acquisition, that, on a Pro Forma Basis, the Company and its Restricted
Subsidiaries would have been in compliance with Sections 7.09, 7.10 and
7.11 of this Agreement; and (C) to the extent that such acquisition is of
the capital stock of or other ownership interest in another Person (such
Person, the "Acquired Entity"), (I) such acquisition must be of at least a
majority of such capital stock or of such ownership interests, such Person
shall constitute a Restricted Subsidiary and all of the applicable
provisions of Section 7.14 shall have been complied with in respect of
such Restricted Subsidiary and (II) the Board of Directors or other
governing body of the Acquired Entity shall not have indicated, either
publicly or privately to the Company or any of its Restricted
Subsidiaries, its opposition to the consummation by the Company or such
Subsidiary of such acquisition;
(h) the Company and its Restricted Subsidiaries may sell or
discount, in each case without recourse, accounts receivable arising in
the ordinary course of business, but only in connection with the
compromise or collection thereof;
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(i) Capital Expenditures by the Company and/or its Restricted
Subsidiaries made in the ordinary course of business; and
(j) the Company and its Restricted Subsidiaries may sell assets (and
may effect Permitted Restricted Subsidiary Conversions) other than in the
ordinary course of business, so long as (x) each such asset is sold (or
deemed sold pursuant to any Permitted Restricted Subsidiary Conversion) at
fair market value, as determined in good faith by management of the
Company; (y) each such sale (or deemed sale pursuant to any Permitted
Restricted Subsidiary Conversion) results in consideration in the form of
cash, promissory notes issued by the respective purchaser and/or other
assets, provided that, to the extent any such other assets are received by
the Company and/or its Restricted Subsidiaries in connection with any such
asset sale, (I) the market value of such other assets, when added to the
aggregate amount of other consideration received in connection with such
asset sale, shall equal or exceed the market value of the assets so sold
and (II) such assets are permitted to be acquired by the Company or any of
its Restricted Subsidiaries pursuant to Section 7.02(g) at the time of
consummation of such asset sale (both before and after giving effect to
such asset sale); and (z) the aggregate value of all assets so sold (or
deemed sold pursuant to any Permitted Restricted Subsidiary Conversion) by
the Company and its Restricted Subsidiaries in any fiscal year shall not
exceed $25,000,000.
7.03 Liens. The Company will not, and will not permit any of its
Restricted Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon or with respect to any property or assets of any kind (real or personal,
tangible or intangible) of the Company or its Restricted Subsidiaries, whether
now owned or hereafter acquired, or sell any such property or assets subject to
an understanding or agreement, contingent or otherwise, to repurchase such
property or assets (including sales of accounts receivable or notes with
recourse to the Company or any of its Restricted Subsidiaries) or assign any
right to receive income, except:
(a) Liens for taxes not yet due or Liens for taxes being contested
in good faith and by appropriate proceedings for which adequate reserves
have been established in accordance with GAAP;
(b) Liens in respect of property or assets of the Company or any of
its Restricted Subsidiaries imposed by law which were incurred in the
ordinary course of business and which have not arisen to secure
Indebtedness for borrowed money, such as carriers', warehousemen's and
mechanics' Liens, statutory
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landlord's Liens, and other similar Liens arising in the ordinary course
of business, and which either (x) do not in the aggregate materially
detract from the value of such property or assets or materially impair
the use thereof in the operation of the business of the Company or its
Restricted Subsidiaries or (y) are being contested in good faith by
appropriate proceedings, which proceedings have the effect of preventing
the forfeiture or sale of the property or asset subject to such Lien;
(c) Liens in existence on the Effective Date which are listed, and
the property subject thereto described, in Annex IV, without giving effect
to any extensions or renewal thereof ("Permitted Liens");
(d) Liens arising from judgments, decrees or attachments in
circumstances not constituting an Event of Default under Section 8.08;
(e) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security, or to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations incurred in the ordinary course of business (exclusive
of obligations in respect of the payment for borrowed money);
(f) leases or subleases granted to third Persons not interfering in
any material respect with the business of the Company or any of its
Restricted Subsidiaries;
(g) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the ordinary conduct of the
business of the Company or any of its Restricted Subsidiaries;
(h) Liens arising from UCC financing statements regarding leases
permitted by this Agreement;
(i) purchase money Liens securing payables arising from the purchase
by the Company or any of its Restricted Subsidiaries of any equipment or
goods in the normal course of business, provided that such payables shall
not constitute Indebtedness;
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(j) any interest or title of a lessor or sublessor under any lease
permitted by this Agreement;
(k) Liens created pursuant to Capital Leases permitted pursuant to
Section 7.04(c);
(l) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of custom duties in connection with the
importation of goods so long as such Liens attach only to the imported
goods;
(m) Liens on assets acquired (or owned by a Restricted Subsidiary
acquired) after the Effective Date securing Indebtedness permitted under
Section 7.04(g), provided that at the time of such acquisition the value
of the assets subject to such Liens does not exceed 10% of the total value
of the assets so acquired, or of the assets of the Restricted Subsidiary
so acquired, as the case may be;
(n) Liens arising out of consignment or similar arrangements for the
sale of goods entered into by the Company or any of its Restricted
Subsidiaries in the ordinary course of business;
(o) Liens created under this Agreement and/or the other Credit
Documents;
(p) Liens created under the Additional Credit Agreement and the
other Additional Facility Documents; and
(q) Liens not otherwise permitted hereunder which secure
Indebtedness, Contingent Obligations or other obligations (in each case
permitted hereunder) not exceeding (as to the Company and its Restricted
Subsidiaries) $20,000,000 in the aggregate at any time outstanding.
7.04 Indebtedness. The Company will not, and will not permit any of
its Restricted Subsidiaries to, contract, create, incur, assume or suffer to
exist any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
-37-
(b) Indebtedness incurred pursuant to the Additional Credit
Agreement and the other Additional Facility Documents;
(c) Capitalized Lease Obligations of the Company and its Restricted
Subsidiaries; provided that the aggregate Capitalized Lease Obligations
under all Capital Leases outstanding at any one time shall not exceed
$50,000,000;
(d) Existing Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the Effective Date and listed on Part A of
Annex V hereto ("Existing Debt"), without giving effect to any subsequent
extension, renewal or refinancing thereof except pursuant to Section
7.04(i);
(e) Indebtedness to the extent permitted pursuant to Section
7.05(c);
(f) Indebtedness evidenced by the Subordinated Exchange Debentures
after the issuance thereof in an aggregate principal amount not to exceed
$500,000,000 at any time outstanding;
(g) Indebtedness of a Restricted Subsidiary acquired after the
Effective Date (or Indebtedness assumed at the time of an acquisition of
an asset securing such Indebtedness), provided that (i) such Indebtedness
was not incurred in connection with or in anticipation of such acquisition
and (ii) at the time of such acquisition such Indebtedness does not exceed
10% of the total value of the assets of the Restricted Subsidiary so
acquired, or of the asset so acquired, as the case may be;
(h) additional Indebtedness of the Company and its Restricted
Subsidiaries not otherwise permitted hereunder; provided that (A) in no
event shall the final maturity of such Indebtedness occur prior to the
Final Maturity Date, (B) in no event shall such Indebtedness have a
shorter average life than the Loans hereunder, (C) in no event shall such
Indebtedness contain terms and conditions (including, without limitation,
with respect to the obligor and guarantors, if any, in respect of such
Indebtedness, prepayment and redemption provisions, covenants, defaults,
security, remedies and, if applicable, subordination provisions)
materially less favorable to the Company and its Restricted Subsidiaries
or to the Banks than the terms and conditions of (I) in the case of
Indebtedness issued to the public or in accordance with Rule 144A or
similar rule under the Securities Act of 1933, as amended, the Senior
Notes, (II) in the case of other senior Indebtedness, this Agreement and
the other Credit Documents, and (III)
-38-
in the case of other Indebtedness, similar Indebtedness of the Company
then outstanding or if no similar Indebtedness of the Company is then
outstanding, the Senior Notes (in each case excluding the impact of market
conditions on the interest rate and other economic terms) and (D) the
Company shall have determined, with respect to the incurrence of such
Indebtedness, that the Company and its Restricted Subsidiaries would
have been in compliance, on Pro Forma Basis, with Sections 7.09, 7.10
and 7.11 of this Agreement (any Indebtedness issued pursuant to this
Section 7.04(h), "Additional Indebtedness"), provided further that, the
aggregate principal amount of any such Additional Indebtedness incurred
directly by the Subsidiary Guarantors (taken as a whole), when added to
the aggregate principal amount of Indebtedness incurred directly by the
Subsidiary Guarantors (taken as a whole) pursuant to Section 7.04(j),
shall not exceed $300,000,000 at any time outstanding;
(i) Indebtedness of the Company and its Restricted Subsidiaries
constituting Permitted Refinancing Debt; and
(j) additional Indebtedness of the Company and its Restricted
Subsidiaries (including, but not limited to, Non-Facility Letter of Credit
Outstandings) not exceeding in an aggregate principal amount at any one
time outstanding an amount equal to $150,000,000, provided that the
aggregate principal amount of such Indebtedness incurred by the Subsidiary
Guarantors (taken as a whole), when added to the aggregate principal
amount of Additional Indebtedness incurred by the Subsidiary Guarantors
(taken as a whole) pursuant to Section 7.04(h), shall not exceed
$300,000,000 at any time outstanding.
7.05 Advances, Investments and Loans. The Company will not, and will
not permit any of its Restricted Subsidiaries to, lend money or credit or make
advances to any Person, or purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to,
any Person, except:
(a) the Company and its Restricted Subsidiaries may invest in cash
and Cash Equivalents;
(b) the Company or any of its Restricted Subsidiaries may acquire
and hold receivables owing to it, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms of the Company or such Restricted Subsidiary, as the
case may be;
-39-
(c) the Company may make intercompany loans and advances to any
Restricted Subsidiary, and any Restricted Subsidiary may make intercompany
loans and advances to any other Restricted Subsidiary or the Company
(collectively, "Intercompany Loans"), provided that (i) no Intercompany
Loan may be made to an Excluded Foreign Restricted Subsidiary at any time
if after giving effect to such Intercompany Loan the Net Investments in
Excluded Foreign Restricted Subsidiaries would exceed $30,000,000, and
(ii) no such Intercompany Loan may be made by the Company or a
Wholly-Owned Restricted Subsidiary to an Excluded Domestic Restricted
Subsidiary;
(d) so long as no Default or Event of Default exists or would result
therefrom, the Company and its Restricted Subsidiaries may make loans and
advances of cash to, or cash capital contributions in, any Unrestricted
Subsidiary of the Company; provided that (i) the sum of (A) the aggregate
amount of capital contributions made in, plus the aggregate principal
amount of loans or advances outstanding at any one time made to,
Unrestricted Subsidiaries after the Effective Date pursuant to this clause
(d) (such amount, the "Unrestricted Subsidiary Investment Amount") plus
(B) the Aggregate Conversion Amount at such time, shall not exceed the
Unrestricted Subsidiary Investment Limit then in effect, and (ii) the
Unrestricted Subsidiary receiving cash proceeds from such loan, advance or
contribution shall utilize the entire amount of cash so received to
effectuate an acquisition of assets or capital stock of a Person not an
affiliate of the Company and its Subsidiaries (other than pursuant to a
Permitted Restricted Subsidiary Conversion or a Permitted Restricted Asset
Sale) or to develop the Business and to finance the working capital needs
of such Unrestricted Subsidiary;
(e) the Company and its Restricted Subsidiaries shall be permitted
to (i) make Permitted Acquisitions, (ii) engage in any transaction to the
extent permitted by Section 7.02(e) and (iii) acquire and hold promissory
notes issued by the purchasers of assets sold in accordance with Section
7.02(c) or 7.02(j);
(f) the Company and any of its Restricted Subsidiaries may acquire
and own investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary course of business;
-40-
(g) the Company or any Subsidiary Guarantor may acquire capital
stock or other equity securities (or warrants, rights or options with
respect thereto) issued by any other Restricted Subsidiary;
(h) Interest Rate Protection Agreements permitted by Section 7.06(d)
shall be permitted;
(i) investments by the Company or Restricted Subsidiaries in (x)
Subsidiary Guarantors, provided that if the Subsidiary Guarantor in which
such investment is made is a newly-formed Subsidiary or a Partially-Owned
Restricted Subsidiary newly designated as a Subsidiary Guarantor pursuant
to Section 7.14(b)(x), all of the applicable provisions of Section 7.14
shall have been satisfied with respect to such Restricted Subsidiary, (y)
Excluded Domestic Restricted Subsidiaries, provided that, the Company
shall have determined, in connection with any such investment, that the
Company and its Restricted Subsidiaries would have been in compliance, on
a Pro Forma Basis, with Sections 7.09, 7.10 and 7.11 of this Agreement and
(z) in Excluded Foreign Restricted Subsidiaries, provided that no
investment in an Excluded Foreign Restricted Subsidiary may be made at any
time if after giving effect to such investment the Net Investments in
Excluded Foreign Restricted Subsidiaries would exceed $30,000,000;
(j) the Company and its Restricted Subsidiaries may make loans and
advances to officers, employees and agents in the ordinary course of
business (i) constituting travel advances or (ii) otherwise equal in the
aggregate for the Company and its Restricted Subsidiaries, in the case of
all loans and advances pursuant to this clause (ii), to no more than
$10,000,000 at any one time outstanding less the principal amount of all
Contingent Obligations then outstanding pursuant to Section 7.06(h);
(k) the Company may acquire obligations of, or make loans or
advances to, one or more management investors in connection with such
management investors' acquisition of shares of capital stock of the
Company, provided that (x) the aggregate amount of cash actually advanced
to all such management investors by the Company and its Restricted
Subsidiaries shall not exceed $10,000,000 at any time, and (y) the
aggregate principal amount of all such obligations, loans and advances
shall not exceed $25,000,000 at any one time outstanding; and
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(l) advances, investments and loans not otherwise permitted
hereunder with an aggregate cost or principal amount, as the case may be,
not to exceed $25,000,000 at any time outstanding.
7.06 Contingent Obligations. The Company will not, and will not
permit any of its Restricted Subsidiaries to, contract, create, incur, assume or
suffer to exist any Contingent Obligations, except:
(a) any Subsidiary Guarantor may become liable as guarantor with
respect to any Indebtedness, obligation or liability of the Company or any
other Subsidiary Guarantor to the extent that such Indebtedness,
obligation or liability is otherwise permitted by this Agreement, provided
that a Subsidiary Guarantor (x) may not guaranty any Subordinated Exchange
Debentures and (y) may only guaranty Permitted Refinancing Debt if and to
the extent either (A) it guarantied the indebtedness refinanced thereby or
(B) such Subsidiary Guarantor would
have guarantied the indebtedness refinanced thereby if it had been a
Subsidiary of the Company while such indebtedness was outstanding;
(b) Contingent Obligations pursuant to the Subsidiary Guaranty;
(c) Contingent Obligations pursuant to the Additional Facility
Documents;
(d) Contingent Obligations under Interest Rate Protection Agreements
with respect to the Loans, loans incurred under the Additional Credit
Agreement or any other floating rate Indebtedness of the Company and its
Restricted Subsidiaries otherwise permitted by this Agreement;
(e) Contingent Obligations pursuant to the Contribution Agreement;
(f) Contingent Obligations of the Company outstanding on the
Effective Date and listed on Part B of Annex V hereto ("Existing
Contingent Obligations"), without giving effect to any subsequent
extension, renewal or refinancing thereof;
(g) the Company may become liable as guarantor with respect to any
Indebtedness, obligation or liability of any Subsidiary Guarantor to the
extent that such Indebtedness, obligation or liability is otherwise
permitted by this Agreement;
-42-
(h) the Company and its Restricted Subsidiaries may guaranty in the
ordinary course of business loans and advances to officers, employees and
agents so long as the aggregate principal amount of the loans and advances
so guaranteed does not exceed $10,000,000 less the principal amount of all
loans and advances outstanding pursuant to Section 7.05(j); and
(i) additional Contingent Obligations (including, without
limitation, Contingent Obligations consisting of Non-Facility Letters of
Credit and reimbursement obligations with respect thereto) not otherwise
permitted hereunder not exceeding (for the Company and all of its
Restricted Subsidiaries) in aggregate principal amount at any time
outstanding an amount equal to the lesser of (x) $30,000,000 and (y) when
added to the aggregate principal amount of Indebtedness outstanding under
Section 7.04(j) at such time, $150,000,000.
7.07 Dividends, etc. The Company will not, and will not permit
any of its Restricted Subsidiaries to, declare or pay any dividends (other
than dividends payable solely in capital stock of such Person) or return any
capital to, its stockholders or authorize or make any other distribution,
payment or delivery of property or cash to its stockholders as such, or
redeem, retire, purchase or otherwise acquire, directly or indirectly, for a
consideration, any shares of any class of its capital stock now or hereafter
outstanding (or any warrants for or options or stock appreciation rights in
respect of any of such shares), or set aside any funds for any of the
foregoing purposes, and the Company will not permit any of its Restricted
Subsidiaries to purchase or otherwise acquire for consideration any shares of
any class of the capital stock of the Company or any other Subsidiary, as the
case may be, now or hereafter outstanding (or any options or warrants or
stock appreciation rights issued by such Person with respect to its capital
stock) (all of the foregoing "Dividends"), except that:
(a) the Company may pay regularly accruing dividends on each
issuance of Preferred Stock through the issuance of additional shares of
such Preferred Stock, provided that the Company may pay such regularly
accruing dividends on its Preferred Stock in cash so long as no Default or
Event of Default exists at such time or would result therefrom;
(b) any Subsidiary of the Company may pay Dividends to the Company
or to any Wholly-Owned Restricted Subsidiary of the Company;
(c) any Partially-Owned Restricted Subsidiary may pay cash Dividends
to its stockholders, provided that the Company and its Restricted
Subsidiaries
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must receive at least their proportionate share of any Dividends paid by
such Subsidiary;
(d) so long as no Default or Event of Default exists at such time or
would result therefrom (x) the Company may issue its Subordinated Exchange
Debentures in exchange for its Senior Preferred Stock in accordance with
the terms thereof, (y) the Company may issue its Subordinated Exchange
Debentures in exchange for its Series B Preferred Stock in accordance with
the terms thereof and (z) the Company may issue its Subordinated Exchange
Debentures in exchange for its Series C Preferred Stock in accordance with
the terms thereof, provided that in each such case, the Company shall have
determined, with respect to such issuance, that the Company and its
Restricted Subsidiaries would have been in compliance, on a Pro Forma
Basis, with Sections 7.09, 7.10 and 7.11 of this Agreement;
(e) the Company may exchange shares of its common stock in
replacement for shares of outstanding Preferred Stock;
(f) the Company may issue Permitted Replacement Preferred Stock so
long as either (x) such stock is issued in exchange for or (y) all of the
proceeds from such issuance are used to redeem or repurchase, shares of
outstanding Preferred Stock;
(g) the Company may redeem or repurchase shares of its common stock
from management investors; provided that (x) no Default or Event of
Default is then in existence or would arise therefrom and (y) the
aggregate amount of all cash paid in respect of all such shares and equity
interests so redeemed or repurchased does not exceed the sum of (i)
$5,000,000 in any fiscal year or $15,000,000 in the aggregate after the
Effective Date and (ii) the amount of cash proceeds received by the
Company in respect of the issuance of common equity to management
investors on or after the Effective Date;
(h) the Company and its Subsidiaries may enter into transactions
permitted under Section 7.05(g);
(i) the Company and its Restricted Subsidiaries may acquire the
capital stock of Unrestricted Subsidiaries in accordance with the
provisions of this Agreement;
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(j) so long as no Default or Event of Default exists at such time or
would result therefrom, the Company may redeem or repurchase shares of its
Preferred Stock at a price equal to the liquidation preference thereof
plus accrued but unpaid dividends thereon and any applicable premium with
respect thereto in exchange for, or with the proceeds of, Additional
Preferred Stock and/or Indebtedness incurred under Sections 7.04(h) and/or
7.04(j) (it being understood and agreed that such redemption and/or
repurchase need not occur contemporaneously with the issuance of such
Additional Preferred Stock or Indebtedness);
(k) so long as no Default or Event of Default exists at such time or
would result therefrom, the Company may declare and pay cash Dividends to
the holders of its common stock (including, without limitation,
repurchases of shares of its common stock), provided that (x) the
aggregate amount of cash Dividends paid pursuant to this clause (k) during
any fiscal year of the Company does not exceed $25,000,000 and (y) the
Company shall have determined, in connection with such Dividend, that the
Company and its Restricted Subsidiaries would have been in compliance, on
a Pro Forma Basis, with Sections 7.09, 7.10 and 7.11 of this Agreement;
and
(l) the Company may pay additional cash Dividends to the holders of
its common stock so long as (x) no Default or Event of Default exists at
such time or would result therefrom, (y) the Leverage Ratio at such time
is less than 4.00:1.00 and (z) the Company shall have determined, in
connection with such Dividend, that the Company and its Restricted
Subsidiaries would have been in compliance, on a Pro Forma Basis, with
Sections 7.09, 7.10 and 7.11 of this Agreement.
7.08 Transactions with Affiliates. The Company will not, and will
not permit any of its Restricted Subsidiaries to, enter into any transaction or
series of transactions, whether or not in the ordinary course of business, with
any Affiliate (other than the Company or any Restricted Subsidiary) other than
on terms and conditions substantially as favorable to the Company or such
Restricted Subsidiary as would be obtainable by the Company or such Restricted
Subsidiary at the time in a comparable arm's-length transaction with a Person
other than an Affiliate; provided that (i) the Company may pay management and
transaction fees to KKR or its affiliates which have been disclosed in writing
to the Banks prior to the Effective Date; (ii) the payment of transaction fees
to KKR for the rendering of financial advice and services in connection with
acquisitions, dispositions and financings by the Company and its Restricted
Subsidiaries in amounts
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which are in accordance with past practices shall be permitted; (iii) loans
and advances to officers, employees and agents in the ordinary course of
business shall be permitted; (iv) customary fees may be paid to non-officer
directors of the Company and/or its Restricted Subsidiaries; (v) the loans,
advances and contributions made (or deemed made) in Unrestricted Subsidiaries
in compliance with Section 7.05(d) shall be permitted; and (vi) transactions
specifically permitted by the provisions of this Agreement to occur between
the Company, its Restricted Subsidiaries and their respective Affiliates
shall be permitted to the extent so otherwise specifically permitted.
7.09 Fixed Charge Coverage Ratio. The Company will not permit the
ratio of (i) Consolidated EBITDA of the Company and its Restricted Subsidiaries
to (ii) Consolidated Fixed Charges of the Company and its Restricted
Subsidiaries, for any Test Period, to be less than 1.05 to 1.0.
7.10 Interest Coverage Ratio. The Company will not permit the ratio
of (i) Consolidated EBITDA of the Company and its Restricted Subsidiaries to
(ii) Consolidated Interest Expense of the Company and its Restricted
Subsidiaries for any Test Period ending during a period listed below to be less
than the ratio set forth opposite such period below:
Period Ratio
------ -----
Effective Date to and including
June 30, 1999 1.80 to 1.00
July 1, 1999 to and including
June 30, 2000 2.00 to 1.00
July 1, 2000 to and including
June 30, 2001 2.25 to 1.00
July 1, 2001 and thereafter 2.50 to 1.00
7.11 Leverage Ratio. The Company will not permit the ratio (the
"Leverage Ratio") of (i) Consolidated Debt of the Company and its Restricted
Subsidiaries at any date of determination thereof to (ii) Consolidated EBITDA of
the
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Company and its Restricted Subsidiaries for the Test Period then last ended,
to exceed, at any time during a period set forth below, the ratio set forth
opposite such period below:
Period Ratio
------ -----
Effective Date to and including
June 30, 1999 6.00 to 1.00
July 1, 1999 to and including
June 30, 2000 5.50 to 1.00
July 1, 2000 to and including
June 30, 2001 5.00 to 1.00
July 1, 2001 and thereafter 4.50 to 1.00
7.12 Issuance of Stock. The Company will not, and will not permit
any of its Restricted Subsidiaries to, directly or indirectly, issue, sell,
assign, pledge or otherwise encumber or dispose of any shares of its or such
Restricted Subsidiary's preferred or preference stock or other redeemable equity
securities (or warrants, rights or options to acquire shares of any of the
foregoing) except:
(a) in the case of shares of capital stock of the Company and its
Restricted Subsidiaries, to the extent permitted by Section 7.02, 7.03,
7.05, 7.07 or 7.13(b);
(b) issuances by Restricted Subsidiaries to the Company or to
Wholly- Owned Restricted Subsidiaries; and
(c) issuances by the Company of additional preferred stock not
otherwise permitted hereunder; provided that (A) in no event shall such
preferred stock contain any provision requiring mandatory redemption or
permitting any put with respect to all or any portion of such stock prior
to the Final Maturity Date, (B) in no event shall such preferred stock
contain terms and conditions (including, without limitation, pay-in-kind
features, liquidation preferences, voting rights and
-47-
exchange rights)materially less favorable to the Company and its
Restricted Subsidiaries or to the Banks than the terms and conditions of
the Existing Preferred Stock (excluding the impact of market conditions on
the dividend rate and other economic terms) and (C) the Company shall have
determined, in connection with such issuance, that the Company and its
Restricted Subsidiaries would have been in compliance, on a Pro Forma
Basis, with Sections 7.09, 7.10 and 7.11 of this Agreement, provided that,
for purposes of the calculation of compliance with Section 7.09, the ratio
set forth in Section 7.09 shall be deemed to equal 1.25 to 1.0 (any
Preferred Stock issued pursuant to this Section 7.12(c), "Additional
Preferred Stock").
7.13 Modifications of Certain Agreements, etc. The Company will
not, and will not permit any of its Subsidiaries to: (a) after the issuance
thereof, amend or modify (or permit the amendment or modification of) any of
the terms or provisions of the Senior Notes, the Additional Facility
Documents, the Preferred Stock, the Subordinated Exchange Debentures, any
Additional Indebtedness, any Permitted Refinancing Debt or any agreement
related to any of the foregoing other than pursuant to a Permitted Amendment
and/or (b) make (or give any notice in respect thereof) any voluntary or
optional payment or prepayment or redemption or acquisition for value of
(including, without limitation, by way of depositing with the trustee with
respect thereto money or securities before due for the purpose of paying when
due) or exchange of any Subordinated Exchange Debentures, or any Permitted
Refinancing Debt (to the extent issued to refinance Subordinated Exchange
Debentures), provided that the Subordinated Exchange Debentures and any
Permitted Refinancing Debt previously issued to refinance same may be (i)
refinanced with (A) Additional Indebtedness (to the extent that such
Additional Indebtedness would have qualified as Permitted Refinancing Debt in
respect thereof if it had been issued contemporaneously with such
refinancing) and/or Permitted Refinancing Debt or (B) the proceeds from a
common equity issuance by the Company or an issuance by the Company of
Additional Preferred Stock, in each case, after the Effective Date or (ii)
exchanged for Additional Preferred Stock or non-redeemable common equity of
the Company (it being understood and agreed that any refinancing of such
Indebtedness need not occur contemporaneously with the issuance of such
Additional Indebtedness, Additional Preferred Stock and/or common equity). In
addition, the Company will not, and will not permit any of its Restricted
Subsidiaries to, agree to modify, supplement, amend, rescind or otherwise
alter the terms, conditions or provisions of its Certificate of Incorporation
(including, without limitation, by the filing of any certificate of
designation) or its By-Laws in any material respect, other than such
modifications, supplements or amendments that would not materially adversely
affect the interests of the Banks under this Agreement or the other Credit
Documents.
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7.14 Limitation on the Creation of Subsidiaries; Redesignation of
Partially-Owned Restricted Subsidiaries. (a) Notwithstanding anything to the
contrary contained in this Agreement, the Company shall not, and shall not
permit any Subsidiary to, establish, create or acquire after the Effective Date
any Subsidiary unless (w) such Subsidiary is an Unrestricted Subsidiary; (x)
such Subsidiary is an Excluded Foreign Restricted Subsidiary; (y) such
Subsidiary is a Partially-Owned Restricted Subsidiary and at the time of
creation or acquisition thereof, the Company shall have made a Non-Guarantor
Designation with respect to such Partially-Owned Restricted Subsidiary in
accordance with the terms hereof or (z) such Subsidiary is a Restricted
Subsidiary (other than a Restricted Subsidiary of the type described in clauses
(x) or (y) above) and each such new Restricted Subsidiary becomes a party to the
Subsidiary Guaranty by executing a Subsidiary Assumption Agreement in the form
of Exhibit G hereto.
(b) At any time and from time to time, (x) the Company may
redesignate any Excluded Domestic Restricted Subsidiary as a Subsidiary
Guarantor by giving notice thereof to the Administrative Agent and by causing
such Subsidiary to become a party to the Subsidiary Guaranty by executing a
Subsidiary Assumption Agreement in the form of Exhibit G hereto, and (y) the
Company may redesignate any Subsidiary Guarantor which is a Partially-Owned
Restricted Subsidiary as an Excluded Domestic Restricted Subsidiary by making a
Non-Guarantor Designation with respect to such Subsidiary in accordance with the
terms hereof.
(c) At the time of the creation of any Subsidiary described in
clause (z) of Section 7.14(a) and at the time of any redesignation pursuant
to clause (x) of Section 7.14(b), each such new Subsidiary Guarantor shall
execute and deliver, or cause to be executed and delivered, in each case to
the extent not previously executed and delivered, all other relevant
documentation of the type described in Section 4 as such new Subsidiary
Guarantor would have had to deliver if such new Restricted Subsidiary had
been a Restricted Subsidiary and a Subsidiary Guarantor on the Effective Date.
(d) Notwithstanding anything to the contrary contained in this
Section 7.14 or elsewhere in this Agreement, in no event shall any Subsidiary of
the Company guaranty any Indebtedness of the Company or any Wholly-Owned
Subsidiary unless such Subsidiary is a party to the Subsidiary Guaranty;
provided that, to the extent not prohibited by Section 7.04 hereof, (x) Excluded
Foreign Restricted Subsidiaries may guaranty Indebtedness of other Excluded
Foreign Restricted Subsidiaries and (y) Unrestricted Subsidiaries may guaranty
Indebtedness of other Unrestricted Subsidiaries.
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7.15 Limitation on Payments Under the Non-Compete Notes. The Company
will not, and will not permit any of its Subsidiaries to, make any payment
representing the principal of, or interest on, any Non-Compete Note at any time
when any Default or Event of Default exists or would exist immediately after
giving effect to such payment.
SECTION 8. Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
8.01 Payments. (a) The Company shall (i) default in the payment when
due of any principal of the Loans or (ii) default, and such default shall
continue for five or more days, in the payment when due of any interest on the
Loans or any Fees or any other amounts owing hereunder or under any other Credit
Document or (b) any Subsidiary Guarantor shall default in the payment when due
of any amount in respect of any payment of the type described in clause (a)(ii)
above pursuant to the Subsidiary Guaranty, and such default shall continue for
five or more days; or
8.02 Representations, etc. Any representation, warranty or statement
made by the Company or any Subsidiary Guarantor herein or in any other Credit
Document or in any statement or certificate delivered pursuant hereto or thereto
shall prove to be untrue in any material respect on the date as of which made or
deemed made; or
8.03 Covenants. The Company shall (a) default in the due
performance or observance by it of any term, covenant or agreement contained
in Section 6.08 or 7, or (b) default in the due performance or observance by
it of any term, covenant or agreement (other than those referred to in
Section 8.01, 8.02 or clause (a) of this Section 8.03) contained in this
Agreement and such default shall continue unremedied for a period of at least
30 days after notice to the defaulting party by the Administrative Agent or
the Required Banks; or
8.04 Default Under Other Agreements. (a) The Company or any of its
Restricted Subsidiaries shall (i) default in any payment with respect to any
Indebtedness or Contingent Obligation (other than the Obligations) beyond the
period of grace, if any, provided in the instrument or agreement under which
such Indebtedness or Contingent Obligation was created or (ii) default in the
observance or performance of any agreement or condition relating to any such
Indebtedness or Contingent Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event
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shall occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such
Indebtedness or Contingent Obligation (or a trustee or agent on behalf of
such holder or holders) to cause any such Indebtedness or Contingent
Obligation to become due prior to its stated maturity; or (b) any
Indebtedness or Contingent Obligation (other than the Obligations) of the
Company or any of its Restricted Subsidiaries shall be declared to be due and
payable, or shall be required to be prepaid other than by a regularly
scheduled required prepayment or as a mandatory prepayment (unless such
required prepayment or mandatory prepayment results from a default thereunder
or an event of the type that constitutes an Event of Default), prior to the
stated maturity thereof, provided that it shall not constitute an Event of
Default pursuant to clause (a) or (b) of this Section 8.04 unless the
principal amount of any one issue of such Indebtedness or Contingent
Obligation exceeds $7,500,000 or the aggregate amount of all such
Indebtedness and Contingent Obligations referred to in clauses (a) and (b)
above exceeds $15,000,000 at any one time; or
8.05 Bankruptcy, etc. The Company or any of its Restricted
Subsidiaries shall commence a voluntary case concerning itself under Title 11
of the United States Code entitled "Bankruptcy," as now or hereafter in
effect, or any successor thereto (the "Bankruptcy Code"); or an involuntary
case is commenced against the Company or any of its Restricted Subsidiaries
and the petition is not controverted within 10 days, or is not dismissed
within 60 days, after commencement of the case; or a custodian (as defined in
the Bankruptcy Code) is appointed for, or takes charge of, all or
substantially all of the property of the Company or any of its Restricted
Subsidiaries; or the Company or any of its Restricted Subsidiaries commences
any other proceeding under any reorganization, arrangement, adjustment of
debt, relief of debtors, dissolution, insolvency or liquidation or similar
law of any jurisdiction whether now or hereafter in effect relating to the
Company or any of its Restricted Subsidiaries; or there is commenced against
the Company or any of its Restricted Subsidiaries any such proceeding which
remains undismissed for a period of 60 days; or the Company or any of its
Restricted Subsidiaries is adjudicated insolvent or bankrupt; or any order of
relief or other order approving any such case or proceeding is entered; or
the Company or any of its Restricted Subsidiaries suffers any appointment of
any custodian or the like for it or any substantial part of its property to
continue undischarged or unstayed for a period of 60 days; or the Company or
any of its Restricted Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by the Company or any of its
Restricted Subsidiaries for the purpose of effecting any of the foregoing; or
8.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof or a waiver of such standard
or
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extension of any amortization period is sought or granted under Section 412
of the Code; any Plan is, shall have been or is likely to be terminated or the
subject of termination proceedings under ERISA; any Plan shall have an Unfunded
Current Liability; or the Company, any Restricted Subsidiary or any ERISA
Affiliate has incurred or is likely to incur a liability to or on account of a
Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204
or 4212 of ERISA or Section 401(a)(29), 4971, 4975 or 4980 of the Code; or the
Company or any Restricted Subsidiary has incurred or is likely to incur
liabilities pursuant to one or more employee welfare benefit plans (as defined
in Section 3(1) of ERISA) which provide benefits to retired employees (other
than as required by Section 601 of ERISA); and (b) there shall result from any
such event or events the imposition of a lien, the granting of a security
interest, or a liability or a material risk of incurring a liability, on the
part of the Company, any of its Restricted Subsidiaries or any ERISA Affiliate,
which lien, security interest or liability will have a material adverse effect
on the condition (financial or otherwise), operations, assets, liabilities or
prospects of the Company and its Restricted Subsidiaries taken as a whole; or
8.07 Subsidiary Guaranty. (a) The Subsidiary Guaranty or any
provision thereof shall cease to be in full force and effect, or any Subsidiary
Guarantor thereunder or any Person acting on behalf of such Subsidiary Guarantor
shall deny or disaffirm such Subsidiary Guarantor's obligations under such
Subsidiary Guaranty or (b) except as otherwise provided in Section 8.01(b), any
Subsidiary Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed pursuant to
the Subsidiary Guaranty, provided that in the case of Section 13 of the
Subsidiary Guaranty, if the default constitutes a failure to perform or comply
with any provision, covenant or agreement contained in Section 6 (other than
Section 6.08) of this Agreement, such default shall continue unremedied for a
period of at least 30 days after notice to the defaulting Subsidiary Guarantor
by the Administrative Agent or the Required Banks; or
8.08 Judgments. One or more judgments or decrees shall be entered
against the Company or any of its Restricted Subsidiaries involving a liability
of $8,000,000 or more in the case of any one such judgment or decree or
$20,000,000 or more in the aggregate for all such judgments and decrees for the
Company and its Restricted Subsidiaries (not paid or to the extent not covered
by insurance) and any such judgments or decrees shall not have been vacated,
discharged or stayed or bonded pending appeal within 60 days from the entry
thereof; or
8.09 Ownership. A Change of Control Event shall have occurred;
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then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent shall, upon the written
request of the Required Banks, by written notice to the Company, take any or all
of the following actions, without prejudice to the rights of the Administrative
Agent or any Bank to enforce its claims against the Company, except as otherwise
specifically provided for in this Agreement (provided that if an Event of
Default specified in Section 8.05 shall occur with respect to the Company, the
result which would occur upon the giving of written notice by the Administrative
Agent as specified in clauses (i) and (ii) below shall occur automatically
without the giving of any such notice): (i) declare the Total Revolving Loan
Commitment (or the unutilized portion thereof) terminated, whereupon the
Revolving Loan Commitment of each Bank (or the unutilized portion thereof) shall
forthwith terminate immediately and any Commitment Fees shall forthwith become
due and payable without any other notice of any kind; and (ii) declare the
principal of and any accrued interest in respect of all Loans and all
obligations owing hereunder to be, whereupon the same shall become, forthwith
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Company.
SECTION 9. Definitions. As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires.
Defined terms in this Agreement shall include in the singular number the plural
and in the plural the singular:
"Additional Credit Agreement" shall mean the credit agreement, dated
as of the date hereof, among the Company, Canadian Sailings Inc., a Canada
corporation, various lending institutions, The Bank of Nova Scotia, as the
Canadian lender, The Bank of New York and Bankers Trust Company, as
Co-Syndication Agents, The Bank of Nova Scotia, as Documentation Agent, and The
Chase Manhattan Bank, N.A., as Administrative Agent, as amended, modified,
supplemented or extended from time to time in accordance with the terms thereof
and hereof.
"Additional Facility Amount" shall mean at any time, the aggregate
commitments then outstanding under the Additional Credit Agreement, provided
that, if at such time, any commitments with respect to any facility under the
Additional Credit Agreement shall have terminated "Additional Facility Amount"
shall mean, at such time, the aggregate principal amount of loans outstanding
with respect to such facility under the Additional Credit Facility at such time.
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"Additional Facility Documents" shall mean and include each of the
documents and other agreements entered into by the Company or any of its
Subsidiaries in connection with the Additional Credit Agreement (including,
without limitation, the Additional Credit Agreement and any guaranty or
guaranties relating thereto), as in effect on the Effective Date and as the same
may be modified, supplemented or amended from time to time pursuant to the terms
hereof and thereof.
"Additional Indebtedness" shall have the meaning provided in Section
7.04(h).
"Additional Preferred Stock" shall have the meaning provided in
Section 7.12(c).
"Adjusted Total Commitment" shall mean at any time the Total
Revolving Loan Commitment less the aggregate Revolving Loan Commitments of all
Defaulting Banks.
"Administrative Agent" shall have the meaning provided in the first
paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to Section 10.10.
"Affected Eurodollar Loan" shall have the meaning provided in
Section 3.02(f).
"Affected Period" shall mean, with respect to each Affected
Transaction, the period commencing on the date occurring twelve months prior to
the last day of the then most recently ended fiscal quarter of the Company and
ending on the date such Affected Transaction is consummated.
"Affected Transaction" shall mean and include each of the
following: (i) any transfer of assets to an Excluded Domestic Restricted
Subsidiary in connection with a transaction permitted pursuant to Section
7.02(e), (ii) any Permitted Acquisition, (iii) any incurrence of Additional
Indebtedness, (iv) any investment in an Excluded Domestic Restricted
Subsidiary pursuant to Section 7.05(d), (v) any issuance of Subordinated
Exchange Debentures, (vi) the payment of any Dividend as permitted by Section
7.07(k) or (l), (vii) any issuance of Additional Preferred Stock, (viii) any
Permitted Restricted Subsidiary Conversion or Non-Guarantor Designation and
(ix) any designation of an Unrestricted Subsidiary as a Restricted Subsidiary
pursuant to the definition of "Restricted Subsidiaries."
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"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by, or under direct or indirect common
control with such Person. A Person shall be deemed to control a corporation if
such Person possesses, directly or indirectly, the power (i) to vote 10% or more
of the securities having ordinary voting power for the election of directors of
such corporation or (ii) to direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.
"Aggregate Conversion Amount" shall mean, at any time, the sum of
the Conversion Value Amount with respect to each Permitted Restricted Subsidiary
Conversion consummated after the Effective Date but on or prior to the date of
determination thereof.
"Aggregate Unutilized Revolving Loan Commitment" with respect to any
Bank at any time shall mean such Bank's Revolving Loan Commitment at such time
less the aggregate outstanding principal amount of all Revolving Loans made by
such Bank.
"Agreement" shall mean this Credit Agreement, as the same may be
from time to time modified, amended and/or supplemented.
"Applicable Commitment Fee Percentage" shall mean 1/8 of 1%.
"Applicable Margin" shall mean, at any time, (a) with respect to
Base Rate Loans, the margin set forth below under the heading Applicable Base
Rate Margin and (b) with respect to Eurodollar Loans, the margin set forth below
under the heading Applicable Eurodollar Margin, in each case, opposite the ratio
of (i) Consolidated Debt as of the last day of the most recent fiscal year or
fiscal quarter in respect of which the Banks shall have received Section 6.01
Financials to (ii) Consolidated EBITDA for the Test Period ending on the last
day of such fiscal year or fiscal quarter (it being understood that each
Applicable Margin shall be in effect from the date the respective Section 6.01
Financials are required to be delivered to the Banks until the date the next
such Section 6.01 Financials are required to be delivered to the Banks at which
time the
Applicable Margin shall be reset in accordance with the foregoing provisions of
this definition):
Applicable Applicable
Eurodollar Base Rate
Debt/EBITDA Ratio Margin Margin
- ----------------- ---------- ----------
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5.50:1 or Greater 1-1/2% 1/8 of 1%
Less than 5.50:1 but equal
to or greater than 5.00:1 1-1/8% 0%
Less than 5.00:1 but equal
to or greater than 4.50:1 7/8 of 1% 0%
Less than 4.50:1 but equal
to or greater than 4.00:1 5/8 of 1% 0%
Less than 4.00:1 1/2 of 1% 0%
; provided that if (A) any Section 6.01 Financials are not delivered when
required (the "Late Section 6.01 Financials") and such Late Section 6.01
Financials establish that any Applicable Margin would have been increased or
reduced to an amount set forth in the table above on the date that such Late
Section 6.01 Financials were required to have been delivered (the "Required
Delivery Date") and (B) the Company shall have made any interest payment during
the period from the Required Delivery Date to the actual date of delivery of
such Late Section 6.01 Financials based upon any such lower or higher Applicable
Margin, then (x) in the case of actual payments based on any such lower
Applicable Margin, the Company shall pay in the form of a supplemental interest
payment, an amount which equals the difference between the amount of interest
which would otherwise have been paid determined as if the Late Section 6.01
Financials were delivered on the Required Delivery Date and the amount of such
interest so paid, which supplemental interest payment shall be due and payable
on the date of delivery of the Late Section 6.01 Financials and (y) in the case
of actual payments made based on such higher Applicable Margin, the Banks shall
retain all such amounts so paid.
"Applicable Percentage" shall mean, (i) at any time prior to the
Conversion Date, a fraction (expressed as a percentage) the numerator of
which is the Total Revolving Loan Commitment at such time and the denominator
of which is equal to the sum of (y) the Total Revolving Loan Commitment at
such time and (z) the Additional Facility Amount at such time; provided that
if the Total Revolving Loan Commitment shall have terminated, the Applicable
Percentage shall be calculated based upon the aggregate principal amount of
Revolving Loans then outstanding and (ii) at any time after the Conversion
Date has occurred, a fraction (expressed as a percentage) the numerator of
which is equal to the aggregate principal amount of all Term Loans
outstanding at such time and the denominator of which is equal to the sum of
(y) the
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aggregate principal amount of Term Loans then outstanding and (z) the
Additional Facility Amount at such time.
"Appraisal Firm" shall mean an independent appraisal firm (which may
be an investment banking firm of national recognition) selected by, and at the
expense of, the Company and reasonably satisfactory to the Administrative Agent.
"Asset Sale" shall mean any sale, transfer or other disposition by
the Company or any of its Restricted Subsidiaries to any Person other than the
Company or any Restricted Subsidiary of any asset (including, without
limitation, any capital stock or other securities of another Person, but
excluding any sale, transfer or other disposition by the Company of its capital
stock) of the Company or such Restricted Subsidiary, including, without
limitation, a Permitted Restricted Asset Sale and any sale, transfer or other
disposition deemed made pursuant to a Permitted Restricted Subsidiary Conversion
(other than (x) any sale, transfer or disposition of Cash Equivalents; (y) any
sale, transfer or disposition permitted by Section 7.02(a), (e) or (h); and (z)
for purposes of Sections 2.03(b), any sale, transfer or disposition of assets
(other than capital stock or other securities of any Subsidiary) that results in
Available Cash Proceeds (including Available Cash Proceeds of any related sale,
transfer or disposition) of not in excess of $10,000,000).
"Authorized Officer" shall mean any officer of the Company
designated as such in writing to the Administrative Agent by the Company, in
each case to the extent reasonably acceptable to the Administrative Agent.
"Available Cash Proceeds" shall mean, with respect to any sale,
lease, transfer or other disposition of assets, the aggregate cash payments
(including any cash received by way of deferred payment pursuant to a note
receivable issued in connection with such sale, lease, transfer or other
disposition, other than the portion of such deferred payment constituting
interest, and including any amounts received as disbursement or withdrawals
from any escrow or similar account established in connection with any such
sale, lease, transfer or other disposition, but, in either such case, only as
and when so received; but excluding any portion of cash payments which the
Company determines in good faith (x) should be reserved for post-closing
adjustments (to the extent the Company delivers to the Banks a certificate
signed by its chief financial officer, controller or chief accounting officer
as to such determination) or (y) must be applied to repurchase Senior Notes
pursuant to the Senior Note Documents (to the extent the Company delivers to
the Banks a certificate signed by its chief financial officer, controller or
chief accounting officer as to such determination), it being understood and
agreed that on the date that all such post-closing adjustments have been
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determined and/or the date such repurchases shall be required to be effected,
as the case may be, the amount (if any) by which the reserved amount in
respect of such sale or disposition exceeds the actual post-closing
adjustments payable by the Company or any of its Subsidiaries or actual
amount expended in connection with such repurchases, as the case may be,
shall constitute Available Cash Proceeds on such date) received by the
Company and/or any of its Subsidiaries from such sale, lease, transfer or
other disposition.
"Bank" shall have the meaning provided in the first paragraph of
this Agreement.
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing or (ii) a
Bank having notified the Administrative Agent and/or the Company that it does
not intend to comply with the obligations under Section 1.01(a) or 1.01(b), in
the case of either (i) or (ii) as a result of the appointment of a receiver or
conservator with respect to such Bank at the direction or request of any
regulatory agency or authority.
"Bankruptcy Code" shall have the meaning provided in Section 8.05.
"Base Rate" at any time shall mean the higher of (x) the rate which
is 1/2 of 1% in excess of the Federal Funds Effective Rate and (y) the Prime
Lending Rate as in effect from time to time.
"Base Rate Loan" shall mean each Loan bearing interest at the rates
provided in Section 1.08(a).
"BONY Term Loan Facility" shall mean the credit facility among the
Company, various lending institutions and The Bank of New York, as Agent,
providing for the making of term loans to the Company in an aggregate amount not
to exceed $150,000,000 outstanding at any time, as same may have been modified,
supplemented or amended from time to time pursuant to the terms thereof.
"Borrowing" shall mean a borrowing of Loans from all Banks on a
given date (or resulting from conversions on a given date), in each case, as
required by the provisions of this Agreement, being of a single Type of Loans
and having, in the case of Eurodollar Loans, the same Interest Period,
provided that Base Rate Loans incurred pursuant to Section 1.10(b) shall be
considered part of any related Borrowing of Euro- dollar Loans.
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"Business" shall mean and include the communications, information,
education, publishing and/or media businesses.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day excluding Saturday, Sunday and any day which shall
be in the City of New York a legal holiday or a day on which banking
institutions are authorized by law or other governmental actions to close and
(ii) with respect to all notices and determinations in connection with, and
payments of principal and interest on, Euro- dollar Loans, any day which is a
Business Day described in clause (i) and which is also a day for trading by and
between banks in U.S. dollar deposits in the interbank Euro- dollar market.
"Capital Expenditures" shall mean, for any period, any expenditures
(whether paid in cash or accrued as liabilities and including in all events all
amounts expended or capitalized under Capital Leases) by any Person during that
period that, in conformity with GAAP, are or are required to be included in the
property, plant or equipment reflected in the balance sheet of such Person.
"Capital Lease," as applied to any Person, shall mean any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with GAAP, is accounted for as a capital lease on the balance
sheet of that Person.
"Capitalized Lease Obligations" shall mean all obligations under
Capital Leases of the Company or any of its Restricted Subsidiaries in each case
taken at the amount thereof accounted for as liabilities in accordance with
GAAP.
"Cash Equivalents" shall mean (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than one year from the date of acquisition, (ii) U.S. dollar denominated time
deposits, certificates of deposit and bankers acceptances of (x) any Bank, (y)
any commercial bank of recognized standing having capital and surplus in excess
of $500,000,000 or (z) any bank whose short-term commercial paper rating from
Standard & Poor's Ratings Group ("S&P") is at least A-2 or the equivalent
thereof or from Moody's Investors Service, Inc. ("Moody's") is at least P-2 or
the equivalent thereof (any such bank or Bank, an "Approved Bank"), in each case
with maturities of not more than one year from the date of acquisition, (iii)
commercial paper issued by any Approved Bank or by the parent company of any
Approved Bank and commercial paper issued by, or guaranteed by, any industrial
or financial company
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with a short-term commercial paper rating of at least A-2 or the equivalent
thereof by S&P or at least P-2 or the equivalent thereof by Moody's, or
guaranteed by any industrial company with a long term unsecured debt rating
of at least A or A2, or the equivalent of each thereof, from S&P or Moody's,
as the case may be, and in each case maturing within one year after the date
of acquisition, (iv) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or
any public instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either S&P or Moody's and (v) investments in
money market funds substantially all the assets of which are comprised of
securities of the types described in clauses (i) through (iv) above.
"Change of Control Event" shall mean (a) any "Change of Control" or
similar term as defined in the indentures governing the terms of the Senior
Notes as in effect on the Effective Date or in any agreement governing any
Indebtedness incurred pursuant to Section 7.04(f), (h), (i) or (j), (b) KKR or
one or more Affiliates of KKR shall cease to own (directly or indirectly) at
least 25% on a fully diluted basis of the economic and voting interest in the
Company's common stock or (c) any Person or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 , as amended)
becomes the "beneficial owner" (as defined in Rule 13d-3 of the Securities
Exchange Act of 1934, as amended) of more of the voting common stock of the
Company than that owned (directly or indirectly) by KKR and its Affiliates.
"Chase" shall mean The Chase Manhattan Bank, N.A. or any successor
thereto by merger.
"Chase Revolving Credit Facility" shall mean the amended and
restated credit facility among the Company, Canadian Sailings Inc., a Canada
corporation, various lending institutions, Bank of America NT&SA, The Bank of
New York, The Bank of Nova Scotia, Bankers Trust Company, Canadian Imperial Bank
of Commerce and Societe Generale, as Co-Agents, and Chase, as Administrative
Agent, providing for the making of revolving loans and the issuance of, and
participation in, letters of credit in an aggregate amount not to exceed
$670,000,000 outstanding at any time, as same may have been modified,
supplemented or amended from time to time pursuant to the terms thereof.
"Chase Term Loan Facility" shall mean the credit facility among the
Company, various lending institutions, Bank of America Illinois, The Bank of
Nova Scotia, Chemical Bank, Midland Bank plc and The Industrial Bank of Japan,
Limited,
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as Co-Agents, and Chase, as Administrative Agent, providing for the
making of term loans in an aggregate amount not to exceed $150,000,000
outstanding at any time, as same may have been modified, supplemented or amended
from time to time pursuant to the terms thereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time and the regulations promulgated and the rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the date of this
Agreement and any subsequent provisions of the Code amendatory thereof,
supplemental thereto or substituted therefor.
"Commitment Fee" shall have the meaning provided in Section 2.01(a).
"Company" shall have the meaning provided in the first paragraph of
this Agreement.
"Consolidated Capital Expenditures" shall mean, for any period, the
aggregate of all Capital Expenditures by the Company and its Restricted
Subsidiaries at such time determined on a consolidated basis.
"Consolidated Current Assets" shall mean, at any time, the current
assets (other than cash and Cash Equivalents, and deferred income taxes to the
extent included in current assets) of the Company and its Restricted
Subsidiaries at such time determined on a consolidated basis.
"Consolidated Current Liabilities" shall mean, at any time, the
current liabilities of the Company and its Restricted Subsidiaries determined on
a consolidated basis, but excluding (i) all short-term Indebtedness for borrowed
money, (ii) the current portion of any long-term Indebtedness of the Company or
its Restricted Subsidiaries, (iii) deferred income taxes, (iv) liabilities
arising from cash overdrafts, and (v) liabilities arising from the honoring by a
bank or other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business, provided that such
liabilities are extinguished within three Business Days of their incurrence; in
each case to the extent included in current liabilities.
"Consolidated Debt" shall mean all Indebtedness of the Company and
its Restricted Subsidiaries, determined on a consolidated basis, other than
Indebtedness owing by the Company to any of its Restricted Subsidiaries or by
any of the Company's
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Restricted Subsidiaries to the Company or any other Restricted Subsidiary of
the Company, provided that, for purposes of this definition, (x) only the
principal amount of Indebtedness outstanding under the Non-Compete Notes
issued as of the date of determination (net of the amount of any reduction to
the amounts owed under such Non-Compete Notes made in accordance with the
terms of the Non-Competition Agreement referred to in the definition of
Non-Compete Notes) shall be included and (y) Indebtedness of any
Partially-Owned Restricted Subsidiary shall be included in Consolidated Debt
in an aggregate amount equal to the percentage equity ownership of the
Company in such Partially-Owned Restricted Subsidiary multiplied by the
aggregate Indebtedness of such Partially-Owned Restricted Subsidiary.
"Consolidated EBITDA" shall mean, for any period, (A) the sum
(without duplication) of the amounts for such period of (i) the net income (or
loss) of the Company and its Restricted Subsidiaries on a consolidated basis for
such period taken as a single accounting period, provided that, except as
provided in clauses (I) through (III) below, there shall be excluded from
Consolidated EBITDA (x) the net income (or loss) of all Unrestricted
Subsidiaries and all Partially-Owned Restricted Subsidiaries for such period and
(y) all cash or other payments received during such period by the Company and
its Restricted Subsidiaries from any Unrestricted Subsidiaries from dividends or
distributions (including tax sharing payments), in each case to the extent
otherwise included, (ii) provisions for taxes based on income, (iii)
Consolidated Interest Expense, (iv) amortization or write-off of deferred
financing costs, (v) losses on sales of assets (excluding sales in the ordinary
course of business) and other extraordinary losses, (vi) non-cash amounts
charged as compensation for "phantom stock" arrangements, (vii) all non-cash
interest expense not included in the foregoing clause (vi), (viii) depreciation
expense and (ix) amortization expense, in the case of each of clauses (ii)
through (ix) above to the extent deducted in determining net income (or loss)
pursuant to clause (i) above for such period, less (B) the amount for such
period of gains on sales of assets (excluding sales in the ordinary course of
business) and other extraordinary gains, in each case, to the extent included in
determining net income (or loss) pursuant to clause (A)(i) above for such
period, all as determined on a consolidated basis; provided, however, that (I)
for purposes of Section 7.11 and the definitions of Applicable Margin, (1) there
shall be included in determining Consolidated EBITDA for any period (x) the net
income (or loss) of any person, business, property or asset (other than an
Unrestricted Subsidiary) acquired and not subsequently sold or otherwise
disposed of (but not including the net income (or loss) of any related person,
business, property or assets to the extent not so acquired) by the Company or
one of its Restricted Subsidiaries during such period (each such person,
business, property or asset acquired and not subsequently disposed of, an
"Acquired Entity or Business"), and the net income (or loss) of any
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Unrestricted Subsidiary that is converted into a Restricted Subsidiary during
such period (each, a "Converted Restricted Subsidiary"), in each case based
on the actual net income (or loss) of such Acquired Entity or Business or
Converted Restricted Subsidiary for the entire period (including the portion
thereof occurring prior to such acquisition or conversion) and (y) an
increase in respect of each Acquired Entity or Business acquired during such
period equal to the cost adjustment amount applicable to the relevant period
determined by the Company to represent the savings secured by the Company in
connection with its reduction of salary and other employment expenses and
lease and other contractual expenses with respect to such Acquired Entity or
Business and (2) there shall be excluded in determining Consolidated EBITDA
for any period the net income (or loss) of any person, business, property or
asset (other than an Unrestricted Subsidiary) sold or disposed of by the
Company or one of its Restricted Subsidiaries during such period (each such
person, business, property or asset so sold or disposed of, a "Sold Entity or
Business"), and the net income (or loss) of any Restricted Subsidiary that is
converted into an Unrestricted Subsidiary during such period (each, a
"Converted Unrestricted Subsidiary"), in each case based on the actual net
income (or loss) of such Sold Entity or Business or Converted Unrestricted
Subsidiary for the entire period (including the portion thereof occurring
prior to such sale, disposition or conversion), (II) for purposes of this
definition, subject to clause (III) below, there shall be included or
excluded any of the items described in the above clauses (A) and (B)
attributable to a Partially-Owned Restricted Subsidiary, but only to the
extent of the equity percentage ownership of the Company in such
Partially-Owned Restricted Subsidiary and (III) in the event the aggregate
portion of Consolidated EBITDA for any period attributable to Partially-Owned
Restricted Subsidiaries (the "Limited EBITDA Component") exceeds an amount
equal to 15% of the aggregate amount of Consolidated EBITDA of the Company
and its Restricted Subsidiaries for such period, the Limited EBITDA Component
(and accordingly Consolidated EBITDA), in each case, for such period, shall
be reduced such that the Limited EBITDA Component for such period equals 15%
of the aggregate amount of such Consolidated EBITDA for such period.
"Consolidated Fixed Charges" shall mean, for any period, the sum,
without duplication, of the amounts for such period of (i) Consolidated Interest
Expense, plus consolidated cash Dividend expense payable in respect of all
Preferred Stock and common stock of the Company, (ii) provisions for taxes based
on income other than (x) changes in deferred taxes, (y) taxes on gains resulting
from sales of assets (other than sales in the ordinary course of business) and
(z) taxes on gains on extraordinary items, (iii) Consolidated Capital
Expenditures paid in cash, (iv) scheduled payments on Indebtedness for borrowed
money (including the Term Loans and the term loans outstanding
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under the Additional Credit Agreement but excluding the revolving loans
outstanding under the Additional Credit Agreement) and on the Non-Compete
Notes (other than, in the case of any payments referred to in this clause
(iv), any interest payments to the extent included in Consolidated Interest
Expense), and (v) the Net Maximum Exposure Reduction, if positive, for such
period; all as determined on a consolidated basis for the Company and its
Restricted Subsidiaries; provided that for purposes of this definition, fixed
charges of the type referred to in clauses (i)-(v) above of any
Partially-Owned Restricted Subsidiary shall be included in Consolidated Fixed
Charges in an aggregate amount equal to the percentage equity ownership of
the Company in such Partially-Owned Restricted Subsidiary multiplied by the
fixed charges of the type referred to above of such Partially-Owned
Restricted Subsidiary for the respective period.
"Consolidated Interest Expense" shall mean, for any period, total
interest expense (including that attributable to Capital Leases in accordance
with GAAP but excluding non-cash interest expenses) of the Company and its
Restricted Subsidiaries determined on a consolidated basis with respect to all
outstanding Indebtedness of the Company and its Restricted Subsidiaries,
including, without limitation, all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs (i.e., costs minus benefits) under Interest Rate Protection
Agreements, but excluding, however, amortization of deferred financing costs to
the extent included in total interest expense, all as determined on a
consolidated basis; provided that for purposes of this definition, interest
expense of the type referred to above of any Partially-Owned Restricted
Subsidiary shall be included in Consolidated Interest Expense in an aggregate
amount equal to the percentage equity ownership of the Company in such
Partially-Owned Restricted Subsidiary multiplied by the interest expense of the
type referred to above of such Partially-Owned Restricted Subsidiary for the
respective period.
"Contingent Obligations" shall mean as to any Person (i) any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (a) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (b) to advance or
supply funds (x) for the purchase or payment of any such primary obligation or
(y) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (c) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (d) otherwise to assure or hold
harmless the owner of such primary obligation against
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loss in respect thereof and (ii) any Interest Rate Protection Agreement;
provided, however, that the term Contingent Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course
of business. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determinable amount of the primary obligation
in respect of which such Contingent Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by
such Person in good faith.
"Contribution Agreement" shall have the meaning provided in Section
4.09.
"Conversion Date" shall mean May 23, 1997.
"Conversion Value Amount" shall have the meaning set forth in the
definition of Permitted Restricted Subsidiary Conversion.
"Copyrights" shall have the meaning provided in Section 5.14(a).
"Credit Documents" shall mean this Agreement, any Notes to the
extent issued, the Subsidiary Guaranty and the Contribution Agreement.
"Credit Party" shall mean the Company and each Subsidiary Guarantor.
"Default" shall mean any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is in effect.
"Dividends" shall have the meaning provided in Section 7.07.
"EBITDA" shall mean, for any Restricted Subsidiary or business, for
any period, the portion of Consolidated EBITDA attributable to such Restricted
Subsidiary or business.
"Effective Date" shall have the meaning provided in Section 11.10.
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"Environmental Law" shall mean any federal, state, provincial or
local statute, law, rule, regulation, ordinance, code, policy or rule of common
law now or hereafter in effect and in each case as amended, and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to the environment, health, safety
or Hazardous Materials.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and the
rulings issued thereunder. Section references to ERISA are to ERISA as in
effect at the date of this Agreement and any subsequent provisions of ERISA
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Company or any Subsidiary of the Company would
be deemed to be a "single employer" within the meaning of Section 414(b), (c),
(m) or (o) of the Code.
"Eurodollar Loans" shall mean each Loan bearing interest at the
rates provided in Section 1.08(b).
"Eurodollar Rate" shall mean with respect to each Interest Period
for a Eurodollar Loan, (i) the arithmetic average (rounded to the nearest 1/100
of 1%) of the offered quotation to first-class banks in the interbank Eurodollar
market by each Reference Bank for U.S. dollar deposits of amounts in same day
funds comparable to the outstanding principal amount of the Eurodollar Loan of
such Reference Bank for which an interest rate is then being determined with
maturities comparable to the Interest Period to be applicable to such Eurodollar
Loan, determined as of 10:00 A.M. (New York time) on the date which is two
Business Days prior to the commencement of such Interest Period divided (and
rounded upward to the next whole multiple of 1/16 of 1%) by (ii) a percentage
equal to 100% minus the then stated maximum rate of all reserve requirements
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves) applicable to any member bank of the Federal Reserve System
in respect of Eurocurrency liabilities as defined in Regulation D (or any
successor category of liabilities under Regulation D); provided that if one or
more of the Reference Banks fails to provide the Administrative Agent with its
aforesaid rate, then the Eurodollar Rate in respect of Loans shall be determined
based on the rate or rates provided to the Administrative Agent by the other
Reference Banks or Bank.
"Event of Default" shall have the meaning provided in Section 8.
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"Excess Cash Flow" shall mean, for any period, the remainder of
(x) the sum of (i) Consolidated EBITDA for such period and (ii) the decrease,
if any, in Working Capital from the first day to the last day of such period,
minus (y) the sum of (i) the amount of Consolidated Fixed Charges for such
period (but in the case of Consolidated Capital Expenditures included
therein, only to the extent such expenditures are not financed by
Indebtedness (other than Loans hereunder)) and (ii) the increase, if any, in
Working Capital from the first day to the last day of such period, provided
that in calculating the amount referred to in clause (x)(ii) or (y)(ii)
above, as the case may be, (A) for any period during which the Company and/or
any of its Restricted Subsidiaries have consummated an Asset Sale pursuant to
Section 7.02(c) or a Permitted Acquisition, the portion of the change in
Working Capital for such period attributable to the entity or business sold
or purchased shall be based (x) in the case of an Asset Sale, on the change
in Working Capital attributable to the entity or business sold from the first
day of such period to the date of the consummation of such sale and (y) in
the case of an acquisition, on the change in Working Capital attributable to
the entity or business acquired from the date of consummation of such
acquisition to the last day of such period and (B) Working Capital shall only
include the assets and liabilities of a Partially-Owned Restricted Subsidiary
to the extent of the percentage equity interest of the Company in such
Partially-Owned Restricted Subsidiary.
"Excess Cash Flow Amount" shall mean an amount which initially shall
be zero and which shall be (i) increased on the date of delivery of Section 6.01
Financials in respect of the first three fiscal quarters in each year of the
Company (commencing with the fiscal quarter ended June 30, 1996) by an amount
(if positive) equal to 75% of Excess Cash Flow for the fiscal quarter in respect
of which such Section 6.01 Financials are delivered, provided that in the event
that Excess Cash Flow for the first and/or second fiscal quarter in any fiscal
year is negative, then for purposes of this clause (i) the Excess Cash Flow for
the third fiscal quarter in such fiscal year shall be deemed to be reduced by
the amount of such negative Excess Cash Flow for such first and/or second
quarter, and (ii) increased on the date of delivery of Section 6.01 Financials
in respect of each fiscal year of the Company by an amount (if positive) equal
to 75% of the Excess Cash Flow for such fiscal year less an amount (if any)
equal to the aggregate amount by which the Excess Cash Flow Amount was increased
pursuant to clause (i) above in respect of the first, second and third quarters
in such fiscal year.
"Excluded Domestic Restricted Subsidiary" shall mean any Partially-
Owned Restricted Subsidiary with respect to which the Company shall have made a
Non-Guarantor Designation in accordance with the provisions hereof.
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"Excluded Foreign Restricted Subsidiaries" shall mean (i) Daily
Racing Form of Canada Ltd., a Canada corporation, (ii) Admirefruit Limited, a
U.K. corporation, (iii) Canadian Red Book, Inc., a Canada corporation, (iv)
Canadian Sailings Inc., a Canada corporation and (v) each Restricted Subsidiary
of the Company established, created or acquired after the Effective Date which
is incorporated in a jurisdiction outside the United States, except to the
extent the requirements set forth in clause (z) of 7.14(a), and Section 7.14(c),
are satisfied with respect to such Subsidiary.
"Existing Contingent Obligations" shall have the meaning provided in
Section 7.06(f).
"Existing Credit Agreements" shall mean and include each of the
Chase Revolving Credit Facility, the Chase Term Loan Facility and the BONY Term
Loan Facility.
"Existing Debt" shall have the meaning provided in Section 7.04(d).
"Existing Indebtedness Agreements" shall have the meaning provided
in Section 4.10.
"Existing Preferred Stock" shall include preferred stock of the
Company issued prior to the Effective Date and listed on Annex VI hereto,
without giving effect to any extension or replacement thereof, as the same may
be modified, supplemented or amended from time to time pursuant to the terms
hereof and thereof.
"Federal Funds Effective Rate" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal Funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean (i) all amounts payable pursuant to, or referred
to in, Section 2.01 and (ii) all other fees payable to the Administrative Agent
or any Bank as may be agreed to from time to time between the Company and the
Administrative Agent or such Bank, as the case may be.
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"Final Maturity Date" shall mean June 30, 2004.
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time; it being understood and
agreed that determinations in accordance with GAAP for purposes of Section 7,
including defined terms as used therein, are subject (to the extent provided
therein) to Section 11.07(a).
"Hazardous Materials" shall mean (a) any petrochemical or
petroleum products, radioactive materials, asbestos in any form that is or
could become friable, urea formaldehyde foam insulation, transformers or
other equipment that contain dielectric fluid containing levels of
polychlorinated biphenyls, and radon gas; and (b) any chemicals, materials or
substances defined as or included in the definition of "hazardous
substances," "hazardous wastes," "hazardous materials," "restricted hazardous
materials," "extremely hazardous wastes," "restrictive hazardous wastes,"
"toxic substances," "toxic pollutants," "contaminants" or "pollutants," or
words of similar import, under any applicable Environmental Law.
"Indebtedness" of any Person shall mean without duplication (i) all
indebtedness of such Person for borrowed money, (ii) the deferred purchase price
of assets or services payable to the sellers thereof or any of such seller's
assignees which in accordance with GAAP would be shown on the liability side of
the balance sheet of such Person, (iii) the face amount of all letters of credit
issued for the account of such Person and, without duplication, all drafts drawn
thereunder, (iv) all Indebtedness of a second Person secured by any Lien on any
property owned by such first Person, whether or not such Indebtedness has been
assumed, (v) all Capitalized Lease Obligations of such Person and (vi) all
obligations of such Person to pay a specified purchase price for goods or
services whether or not delivered or accepted, i.e., take-or-pay and similar
obligations, provided that Indebtedness shall not include (x) trade payables and
accrued expenses, in each case arising in the ordinary course of business and
(y) any obligations under Interest Rate Protection Agreements.
"Information Memorandum" shall mean the Confidential Information
Memorandum dated April, 1996 and distributed to the Banks prior to the Effective
Date.
"Initial Borrowing Date" shall mean the date on or after the
Effective Date upon which the initial Borrowing of Loans hereunder occurs.
"Intellectual Property" shall have the meaning provided in Section
5.14(b).
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"Intercompany Loan" shall have the meaning provided in Section
7.05(c).
"Interest Period" with respect to any Eurodollar Loan, shall mean
the interest period applicable thereto, as determined pursuant to Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement,
interest rate hedging agreement or other similar agreement or arrangement
designed to protect the Company or any of its Subsidiaries against fluctuations
in interest rates.
"KKR" shall mean Kohlberg Kravis Roberts & Co., a Delaware limited
partnership.
"Leasehold" of any Person means all of the right, title and interest
of such Person as lessee or licensee in, to and under leases or licenses of
land, improvements and/or fixtures.
"Leverage Ratio" shall have the meaning provided in Section 7.11.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any similar
recording or notice statute, and any lease having substantially the same effect
as the foregoing).
"Loan" shall mean (i) prior to the Conversion Date, Revolving Loans
and (ii) on or after the Conversion Date, Term Loans.
"Margin Stock" shall have the meaning provided in Regulation U.
"Maximum Exposure" shall have the meaning provided in the Additional
Credit Agreement.
"Minimum Borrowing Amount" shall mean $3,000,000.
"Minimum Retention Amount" shall mean, at any time, $10,000,000
multiplied by a fraction (i) the numerator of which shall be (x) if prior to the
Conversion Date, the Total Revolving Loan Commitment at such time or (y) if the
Conversion Date
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has occurred, the sum of the outstanding Term Loans at such time
and (ii) the denominator of which shall be $1,000,000,000.
"Net Cash Proceeds" shall mean, with respect to any Asset Sale, the
Available Cash Proceeds resulting therefrom net of (a) cash expenses of sale
(including payment of principal, premium and interest of Indebtedness
specifically relating to the assets sold in such Asset Sale, relocation expenses
and severance and shutdown costs) and (b) taxes paid or payable as a result
thereof over and above the taxes which would otherwise have been payable in the
absence of such Asset Sale, provided that in the case of an Asset Sale by a
Partially-Owned Restricted Subsidiary, "Net Cash Proceeds" shall be the amount
as determined above in this definition multiplied by the percentage of the
capital stock of such Subsidiary owned, directly or indirectly, by the Company.
"Net Investments in Excluded Foreign Restricted Subsidiaries" shall
mean the remainder of (i) the sum of (x) the aggregate value of all businesses,
properties and assets transferred by the Company and/or its Restricted
Subsidiaries (other than Excluded Foreign Restricted Subsidiaries) to Excluded
Foreign Restricted Subsidiaries after the Effective Date, (y) the aggregate
outstanding principal amount of all Intercompany Loans made to Excluded Foreign
Restricted Subsidiaries by the Company and/or its Restricted Subsidiaries (other
than Excluded Foreign Restricted Subsidiaries) after the Effective Date and (z)
the aggregate amount of all investments by the Company and its Restricted
Subsidiaries (other than Excluded Foreign Restricted Subsidiaries) in Excluded
Foreign Restricted Subsidiaries after the Effective Date, minus (ii) the sum of
(x) the aggregate value of all businesses, properties and assets transferred by
Excluded Foreign Restricted Subsidiaries to the Company and/or its Restricted
Subsidiaries (other than Excluded Foreign Restricted Subsidiaries) after the
Effective Date and (y) the aggregate amount of all cash dividends and other cash
distributions on common stock paid by Excluded Foreign Restricted Subsidiaries
to the Company and its Restricted Subsidiaries (other than Excluded Foreign
Restricted Subsidiaries) after the Effective Date.
"Net Maximum Exposure Reduction" shall have the meaning provided
therefor in the Additional Credit Agreement.
"Non-Compete Notes" shall mean the promissory notes issued by K-III
Holdings Corporation III pursuant to the Non-Competition Agreement, dated as of
June 17, 1991, among K-III Holdings Corporation III, News America Holdings
Incorporated and the other parties thereto in an aggregate principal amount not
to exceed $50,000,000, as such notes may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
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"Non-Defaulting Bank" shall mean each Bank other than a Defaulting
Bank.
"Non-Facility Letter of Credit Outstandings" shall mean, at any
time, the sum of (i) the aggregate maximum amount available to be drawn
(regardless of whether any conditions for drawing could then be met) under all
outstanding Non-Facility Letters of Credit and (ii) the aggregate amount of all
Non-Facility Unpaid Drawings.
"Non-Facility Letters of Credit" shall mean each letter of credit
(other than any letter of credit issued pursuant to the Additional Credit
Agreement) issued for the account of the Company or any of its Restricted
Subsidiaries, provided that the reimbursement obligations of the Company or such
Restricted Subsidiary with respect to such letter of credit may be secured only
to the extent permitted by Section 7.03(q).
"Non-Facility Unpaid Drawings" shall mean all amounts paid or
disbursed by the issuers of Non-Facility Letters of Credit which have not been
reimbursed.
"Non-Guarantor Designation" shall mean and include each of (x) the
designation by the Company of any newly created or acquired Partially-Owned
Restricted Subsidiary and (y) the redesignation of any existing Partially-Owned
Restricted Subsidiary which is a Subsidiary Guarantor, in each case, as an
Excluded Domestic Restricted Subsidiary by delivery of a written notice to the
Administrative Agent of such designation or redesignation, as the case may be;
provided that the Company may only make a Non-Guarantor Designation hereunder
if, at the time of such designation (i) no Default or Event of Default exists or
would result therefrom and (ii) the Company shall have determined, with respect
to such designation, that the Company and its Restricted Subsidiaries would have
been in compliance, on a Pro Forma Basis, with Sections 7.09, 7.10 and 7.11 of
this Agreement.
"Note" shall mean and include each promissory note, in the form
agreed by the Company and the Administrative Agent prior to the Effective Date,
to the extent issued pursuant to Section 1.05(b) hereof.
"Notice of Borrowing" shall have the meaning provided in Section
1.03(a).
"Notice of Conversion" shall have the meaning provided in Section
1.06.
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"Notice Office" shall mean the office of the Administrative Agent at
1 Chase Manhattan Plaza, New York, New York 10081, or such other office as the
Administrative Agent may designate to the Company and the Banks from time to
time.
"Obligations" shall mean all amounts, direct or indirect, contingent
or absolute, of every type or description, and at any time existing, owing to
the Administrative Agent or any Bank pursuant to the terms of this Agreement or
any other Credit Document.
"Partially-Owned Restricted Subsidiary" shall mean any Restricted
Subsidiary of the Company to the extent that the Company and its Wholly-Owned
Restricted Subsidiaries shall own less than 100% of the capital stock of such
Restricted Subsidiary.
"Payment Office" shall mean the office of the Administrative Agent
at 1 Chase Manhattan Plaza, New York, New York 10081, or such other office as
the Administrative Agent may designate to the Company and the Banks from time to
time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquisition" shall have the meaning provided in Section
7.02(g).
"Permitted Amendments" shall mean, to any amendment or supplement to
or waiver of the documents governing or evidencing (x) any issue of Indebtedness
which does not (i) add, directly or indirectly, any new covenant, event of
default, collateral requirement or repayment requirement (including pursuant to
any put arrangement), (ii) modify in any manner materially adverse to the issuer
or guarantors thereof any existing covenant, event of default, collateral
requirement or repayment requirement (including any shortening or any
amortization requirements), (iii) increase the interest rate thereon or modify
in any
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manner the time or manner of payment of such interest (including any option
or right to pay such interest in kind), (iv) modify any of the subordination
provisions or (v) contain any provision which, in the opinion of the
Administrative Agent, is materially adverse to the interests of the Banks,
(y) any issue of Preferred Stock which does not (i) add, directly or
indirectly, any new covenant, default, voting, redemption, exchange or put
provision, (ii) modify in any manner adverse to the issuer thereof any
existing covenant, default, voting, redemption, exchange or put provision,
(iii) increase the dividend rate thereon or modify in any manner the time or
manner of payment of such dividends (including any option or right to pay
such dividends in kind) or (iv) contain any provision which, in the opinion
of the Administrative Agent, is materially adverse to the interests of the
Banks or (z) the sole effect of which is to (i) delete covenants or events of
default and/or (ii) add to, or increase existing, exceptions to the covenants
contained therein, or waive any of the covenants contained therein or any
rights of the holders of such Indebtedness or Preferred Stock, as the case
may be, set forth therein.
"Permitted Liens" shall have the meaning provided in Section
7.03(c).
"Permitted Refinancing Debt" shall mean Indebtedness issued in
connection with a refinancing of any or all of the Existing Debt, the
Subordinated Exchange Debentures, any Additional Indebtedness or any other
Permitted Refinancing Debt; provided that (i) such Indebtedness has a longer
average life than the Indebtedness being refinanced and (ii) such
Indebtedness, and the agreements and other documents entered into by the
Company and/or any of its Restricted Subsidiaries in connection therewith
shall contain terms and conditions (including, without limitation, with
respect to the obligor and guarantors, if any, in respect of such
Indebtedness, amortization schedules, interest rates, redemption provisions,
covenants, defaults, security, remedies and, if the Indebtedness so
refinanced is subordinated to any other Indebtedness of the Company or its
Restricted Subsidiaries, subordination provisions) not materially less
favorable to the Company and its Restricted Subsidiaries or to the Banks than
the terms and conditions of the Indebtedness so refinanced (excluding, for
purposes of this clause (ii), the impact of market conditions on the interest
rate and other economic terms).
"Permitted Replacement Preferred Stock" shall mean preferred stock
of the Company issued in connection with the replacement and cancellation of any
outstanding Preferred Stock; provided that such preferred stock and the
agreements, certificates of designation and other documents entered into by the
Company in connection therewith shall contain terms and conditions (including,
without limitation, dividend rates, pay-in-kind features, redemption provisions,
put rights, liquidation preferences, voting rights and exchange rights) not
materially less favorable to the Company or to the Banks than the terms and
conditions of the preferred stock being replaced (excluding the impact of market
conditions on the dividend rate and other economic terms), as such preferred
stock may be amended, modified or supplemented from time to time in accordance
with the terms hereof and thereof.
"Permitted Restricted Asset Sale" shall mean any sale, transfer or
other disposition by the Company or any of its Restricted Subsidiaries (other
than Canadian
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Sailings Inc.) to any Unrestricted Subsidiary of any asset (including,
without limitation, any capital stock or other securities of another Person,
but excluding any sale, transfer or other disposition by the Company of its
capital stock) of the Company or such Restricted Subsidiary; provided that
the Company or such Restricted Subsidiary shall only be permitted to
effectuate a Permitted Restricted Asset Sale so long as (i) no Default or
Event of Default exists or would result therefrom, (ii) the Company shall
have delivered to the Administrative Agent the opinion of value of an
Appraisal Firm to the extent required by Section 7.02(c) and (iii) the
Company shall have, or shall have caused such Restricted Subsidiary to have,
complied with the other terms and conditions of Section 7.02(c) or (j), as
the case may be.
"Permitted Restricted Subsidiary Conversion" shall mean the
redesigna- tion by the Company of a Restricted Subsidiary (other than
Canadian Sailings Inc.) of the Company as an Unrestricted Subsidiary of the
Company pursuant to a written notice to the Administrative Agent and the
Banks; provided that any such redesignation of a Restricted Subsidiary as an
Unrestricted Subsidiary shall be deemed to constitute a sale of all of the
assets of the respective Restricted Subsidiary for all purposes of this
Agreement; provided further, that the Company shall only be permitted to
effectuate a Permitted Restricted Subsidiary Conversion so long as (i) no
Default or Event of Default exists or would result therefrom, (ii) the
Company shall have delivered to the Administrative Agent the opinion of value
of management of the Company or, to the extent required by Section 7.02(c),
the Appraisal Firm required by such Section (the value set forth in any such
opinion, the "Conversion Value Amount"), (iii) the Company shall have
complied with the other terms and conditions of Section 7.02(c) or (j), as
the case may be, (iv) the Aggregate Conversion Amount at such time, when
added to the Unrestricted Subsidiary Investment Amount at such time shall not
exceed the Unrestricted Subsidiary Investment Limit then in effect, and (v)
the Company shall have determined, with respect to such conversion, that the
Company and its Restricted Subsidiaries would have been in compliance, on a
Pro Forma Basis, with Sections 7.09, 7.10 and 7.11 of this Agreement.
"Person" shall mean any individual, partnership, joint venture,
firm, corporation, association, trust or other enterprise or any government or
political subdivision or any agency, department or instrumentality thereof.
"Plan" shall mean any multiemployer or single-employer plan, as
defined in Section 4001 of ERISA, which is maintained or contributed to by (or
to which there is an obligation to contribute of) the Company, any Restricted
Subsidiary or an ERISA Affiliate, and each such plan for the five year period
immediately following the latest
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date on which the Company, any Restricted Subsidiary or an ERISA Affiliate
maintained, contributed to or had an obligation to contribute to such plan.
"Preferred Stock" shall mean and include the Existing Preferred
Stock and, once issued, any Additional Preferred Stock and any Permitted
Replacement Preferred Stock.
"Prescribed Forms" shall mean such duly executed form(s) or
statement(s), and in such number of copies, which may, from time to time, be
prescribed by law and which, pursuant to applicable provisions of (a) an income
tax treaty between the United States and the country of residence of the Bank
providing the form(s) or statement(s), (b) the Code, or (c) any applicable rule
or regulation under the Code, permit the Company to make payments hereunder for
the account of such Bank free of deduction or withholding of income or similar
taxes.
"Prime Lending Rate" shall mean the rate which the Administrative
Agent announces from time to time as its prime commercial lending rate, the
Prime Lending Rate to change when and as such prime commercial lending rate
changes. The Prime Lending Rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged to any customer. The
Administrative Agent may make commercial loans or other loans at rates of
interest at, above or below the Prime Lending Rate.
"Pro Forma Basis" shall mean, with respect to each Affected
Transaction in connection with which any calculation of compliance with any
financial covenant or financial term is required, the calculation thereof on a
pro forma basis, for the Test Period ended on the last day of the most recently
ended fiscal quarter, determined as if (x) such Affected Transaction, each other
Affected Transaction effected by Company during the Affected Period and any
reduction of Consolidated Debt during such Affected Period effected with the
proceeds received by the Company and/or its Restricted Subsidiaries of (A) the
issuance of common equity by the Company or (B) the sale of the capital stock or
other ownership interest of the Company in an Unrestricted Subsidiary (to the
extent not otherwise included in Consolidated EBITDA), in each case, had
occurred on the first day of such Affected Period, and (y) with respect to any
Affected Transaction involving the issuance of Indebtedness or Preferred Stock,
such Indebtedness and/or Preferred Stock had remained outstanding at all times
during such Affected Period.
"Pro Rata Share" shall mean, for each Bank, (i) if prior to the
Conversion Date, the percentage obtained by dividing such Bank's Revolving Loan
Commitment (if
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any) by the Total Revolving Loan Commitment; and (ii) if the Conversion Date
has occurred, the percentage obtained by dividing such Bank's outstanding
Term Loans (if any) by the aggregate of all outstanding Term Loans, provided
that, if at any time of the determination of a Bank's "Pro Rata Share"
pursuant to (i), any Revolving Loan Commitments under this Agreement shall
have been terminated, Pro Rata Share shall be calculated with reference to
the amount of Revolving Loans outstanding rather than such Revolving Loan
Commitments.
"Real Property" of any Person shall mean all of the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Reference Banks" shall mean Chase, The Bank of New York and
Bankers Trust Company.
"Register" shall have the meaning provided in Section 1.05(a).
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing margin requirements.
"Remaining Net Cash Proceeds" shall mean, with respect to any Asset
Sale, at any time, an amount equal to the Net Cash Proceeds from such Asset Sale
theretofore received by the Company and/or its Restricted Subsidiaries minus the
portion, if any, of such Net Cash Proceeds theretofore expended by the Company
or any of its Restricted Subsidiaries in furtherance of the purchase,
construction or other acquisition of assets to be employed in, and/or the
capital stock of any Person engaged in, the Business.
"Replaced Bank" shall have the meaning provided in Section
1.10(c)(ii).
"Replacement Bank" shall have the meaning provided in Section
1.10(c)(ii).
"Reportable Event" shall mean an event described in Section 4043(c)
of ERISA with respect to a Plan other than those events as to which the 30-day
notice is
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waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC Regulation
Section 2615.
"Required Banks" shall mean Non-Defaulting Banks, the sum of whose
(i) at all times prior to the Conversion Date, Revolving Loan Commitments (or
after the termination thereof, the then total outstanding Revolving Loans)
constitute at least 51% of the Adjusted Total Commitment (or after the
termination thereof, the then total outstanding Revolving Loans of
Non-Defaulting Banks) and (ii) on, and at all times after the Conversion Date,
outstanding Term Loans constitute at least 51% of the then total outstanding
Term Loans of Non-Defaulting Banks.
"Restricted Subsidiaries" shall mean (x) all of the Subsidiaries
of the Company in existence on the Effective Date, including, without
limitation, Canadian Sailings Inc., (y) any Subsidiary owned (directly or
indirectly) by the Company that is created, established or acquired after the
Effective Date and which does not constitute an Unrestricted Subsidiary on
the date of the creation, establishment and/or acquisition thereof and (z)
any Unrestricted Subsidiary of the Company to the extent designated by the
Company as a Restricted Subsidiary hereunder by written notice to the
Administrative Agent; provided that the Company shall only be permitted to so
designate a new Restricted Subsidiary so long as (i) no Default or Event of
Default exists or would result therefrom, (ii) at least 51% of the capital
stock of such newly-designated Restricted Subsidiary is owned by the Company
or one or more Wholly-Owned Restricted Subsidiaries and all of the applicable
provisions of Section 7.14 shall have been complied with in respect of such
newly-designated Restricted Subsidiary, (iii) the Company shall have
determined, with respect to such designation, that the Company and its
Restricted Subsidiaries would have been in compliance, on a Pro Forma Basis,
with Sections 7.09, 7.10 and 7.11 of this Agreement and (iv) such
Unrestricted Subsidiary is permitted to be designated a Restricted Subsidiary
pursuant to the Senior Note Documents; provided further, that, at the time of
any Permitted Restricted Subsidiary Conversion or the sale of 100% of the
capital stock owned by the Company or any Restricted Subsidiary of a
Restricted Subsidiary to an Unrestricted Subsidiary pursuant to a Permitted
Restricted Asset Sale, the Restricted Subsidiary so converted or sold shall
no longer constitute a Restricted Subsidiary hereunder.
"Revolving Loan" shall have the meaning provided in Section 1.01(a).
"Revolving Loan Commitment" shall mean, with respect to each Bank,
the amount set forth opposite such Bank's name in Annex I hereto directly below
the
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column entitled "Revolving Loan Commitment", as same may be reduced from
time to time pursuant to Sections 2.02, 2.03 and/or 8.
"Scheduled TL Repayment" shall have the meaning provided in Section
3.02(b).
"Scheduled TL Repayment Date" shall have the meaning provided in
Section 3.02(b).
"SEC" shall mean the Securities and Exchange Commission or any
successor thereto.
"Section 6.01 Financials" shall mean the financial statements
delivered, or to be delivered, pursuant to Section 6.01(a) or (b).
"Senior Note Documents" shall mean and include each of the documents
and other agreements entered into by the Company or any of its Subsidiaries
(including, without limitation, the indentures pursuant to which each issuance
of the Senior Notes are issued and any guaranty or guaranties relating thereto)
relating to the issuance by the Company of any Senior Notes, as in effect on the
Effective Date and as the same may be modified, supplemented or amended from
time to time pursuant to the terms hereof and thereof.
"Senior Notes" shall mean and include the Company's (x) 10-5/8%
Senior Secured Notes due 2002, (y) 10-1/4% Senior Notes due 2004 and (z) 8-1/2%
Senior Notes due 2006, in each case, as in effect on the Effective Date and as
the same may be modified, supplemented or amended from time to time pursuant to
the terms hereof and thereof.
"Senior Preferred Stock" shall mean the Company's $2.875 Senior
Exchangeable Preferred Stock, as in effect on the Effective Date and as the same
may be modified, supplemented or amended from time to time pursuant to the terms
hereof and thereof.
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"Series B Preferred Stock" shall mean the Company's $11.625 Series B
Exchangeable Preferred Stock, as in effect on the Effective Date and as the same
may be modified, supplemented or amended from time to time pursuant to the terms
hereof and thereof.
"Series C Preferred Stock" shall mean the Company's Series C
Exchangeable Preferred Stock, as in effect on the Effective Date and as the same
may be modified, supplemented or amended from time to time pursuant to the terms
hereof and thereof.
"Specified Change of Control Event" shall mean a Change of Control
Event of the type described in clause (a) of the definition thereof.
"Subordinated Exchange Debentures" shall mean and include the
Company's (x) 11-1/2% Subordinated Debentures due 2004, (y) 11-5/8% Class B
Subordinated Exchange Debentures due 2005 and (z) 10% Subordinated Exchange
Debentures due 2008, in each case, in the form delivered to the Banks on the
Effective Date and as the same may be modified, supplemented or amended from
time to time pursuant to the terms hereof and thereof.
"Subsidiary" of any Person shall mean and include (i) any
corporation more than 50% of whose stock of any class or classes having by the
terms thereof ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time stock of any class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency) is at the time owned by such Person directly
or indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time, provided that
Canadian Sailings Inc. shall be deemed to be a Subsidiary of the Company for all
purposes.
"Subsidiary Guarantor" shall mean (i) each Restricted Subsidiary in
existence on the Effective Date (other than Excluded Foreign Restricted
Subsidiaries) and (ii) each Restricted Subsidiary of the Company formed after
the Effective Date and each Excluded Domestic Restricted Subsidiary designated
as such by the Company, in each case, which has executed and delivered a
counterpart of the Subsidiary Guaranty to the Administrative Agent on behalf of
the Banks, provided that any such Restricted Subsidiary which is a
Partially-Owned Restricted Subsidiary shall cease to constitute a Subsidiary
Guarantor to the extent the Company shall have made a Non-Guarantor Designation
with respect to such Subsidiary in accordance with the terms hereof.
"Subsidiary Guaranty" shall have the meaning provided in Section
4.06.
"Taxes" shall have the meaning provided in Section 3.04.
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"Term Loan" shall mean each Revolving Loan that is converted into a
term loan on the Conversion Date pursuant to Section 1.01(b).
"Test Period" shall mean the four consecutive fiscal quarters of the
Company then last ended.
"Total Revolving Loan Commitment" shall mean, at any time prior to
the Conversion Date, the sum of the Revolving Loan Commitments of each of the
Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at any
time, the Total Revolving Loan Commitment at such time less the aggregate
principal amount of all Revolving Loans at such time.
"Type" shall mean any type of Loan determined with respect to the
interest option applicable thereto, i.e., a Base Rate Loan or Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as in effect in the
State of New York.
"Unfunded Current Liability" of any Plan shall mean the amount, if
any, by which the actuarial present value of the accumulated plan benefits under
such Plan as of the close of its most recent plan year exceeds the fair market
value of the assets allocable thereto, each determined in accordance with
Statement of Financial Accounting Standards No. 87, based upon the actuarial
assumptions used by the Plan's actuary in the most recent annual valuation of
the Plan.
"Unrestricted Subsidiary" shall mean (i) any Subsidiary of the
Company that is formed or acquired after the Effective Date, which is funded
through loans, advances and/ or capital contributions as permitted by, and in
compliance with, Section 7.05(d), provided that at the time of the initial loan,
advance or capital contribution by the Company or any Restricted Subsidiary to
such Subsidiary (x) the Company designates such Subsidiary as an Unrestricted
Subsidiary in a written notice to the Administrative Agent and (y) such
Subsidiary and the Company shall have entered into a tax sharing agreement in
form and substance reasonably satisfactory to the Required Banks, (ii) any
Restricted Subsidiary of the Company redesignated as an Unrestricted Subsidiary
pursuant to a Permitted Restricted Subsidiary Conversion and any Restricted
Subsidiary sold to an Unrestricted Subsidiary pursuant to a Permitted Restricted
Asset Sale, in each case to the extent consummated in accordance with the terms
of the respective definitions thereof and Section 7.02(c) or 7.02(j), as the
case may be, and (iii) each Subsidiary of
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an Unrestricted Subsidiary; provided that, at the time of any designation of
the type described in clause (z) of the definition of "Restricted
Subsidiary," the Subsidiary so designated shall no longer constitute an
Unrestricted Subsidiary hereunder.
"Unrestricted Subsidiary Investment Amount" shall have the meaning
provided in Section 7.05(d).
"Unrestricted Subsidiary Investment Limit" shall mean, at any time,
the sum of (i) $200,000,000, (ii) the Excess Cash Flow Amount at such time,
(iii) an amount equal to all cash or other payments received by the Company and
its Restricted Subsidiaries from Unrestricted Subsidiaries from dividends or
distributions after the Effective Date (provided that for purposes of this
clause (iii), cash and other payments received by a Partially-Owned Restricted
Subsidiary shall be added to the Unrestricted Subsidiary Investment Limit only
to the extent of the equity percentage ownership of the Company in such
Partially-Owned Restricted Subsidiary), plus (iv) an amount equal to the
aggregate net proceeds received by the Company from the issuance of equity
securities of the Company after the Effective Date, provided that if the net
proceeds from any such equity issuance are not utilized to make a loan or
advance to, or a cash capital contribution in, an Unrestricted Subsidiary
pursuant to Section 7.05(d) within 30 days following the date of such equity
issuance, then the net proceeds from such equity issuance shall no longer be
added to the Unrestricted Subsidiary Investment Limit.
"U.S. Dollars" and "$" shall mean freely transferable lawful money
of the United States of America.
"Wholly-Owned Restricted Subsidiary" shall mean any Restricted
Subsidiary of the Company which is not a Partially-Owned Restricted Subsidiary.
"Working Capital" shall mean the excess of Consolidated Current
Assets over Consolidated Current Liabilities.
"Written" or "in writing" shall mean any form of written
communication or a communication by means of telex, telecopier device, telegraph
or cable.
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SECTION 10. The Administrative Agent.
10.01 Appointment. Each Bank hereby irrevocably designates and
appoints Chase as Administrative Agent of such Bank and to act as specified
herein and in the other Credit Documents, and each such Bank hereby irrevocably
authorizes Chase as the Administrative Agent for such Bank, to take such action
on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent agrees to act as such upon the
express conditions contained in this Section 10. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein or
in the other Credit Documents, or any fiduciary relationship with any Bank, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent. The provisions of this Section 10 are solely for the
benefit of the Administrative Agent and the Banks, and neither the Company nor
any of its Subsidiaries shall have any rights as a third party beneficiary of
any of the provisions hereof. In performing its functions and duties under this
Agreement, the Administrative Agent shall act solely as agent of the Banks and
the Administrative Agent neither assumes and nor shall it be deemed to have
assumed any obligation or relationship of agency or trust with or for the
Company or any of its Subsidiaries.
10.02 Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement or any other Credit Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise required by Section 10.03.
10.03 Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or the
other Credit Documents (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Banks for
any recitals, statements, representations or warranties made by the Company, any
of its Subsidiaries or any of their respective officers contained in this
Agreement or the other Credit Documents or in any certificate, report, statement
or other
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document referred to or provided for in, or received by the Administrative
Agent under or in connection with, this Agreement or any other Credit
Document or for any failure of the Company or any of its Subsidiaries or any
of their respective officers to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be under any obligation to any
Bank to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or the other
Credit Documents, or to inspect the properties, books or records of the
Company or any of its Subsidiaries. The Administrative Agent shall not be
responsible to any Bank for the effectiveness, genuineness, validity,
enforceabil- ity, collectibility or sufficiency of this Agreement or any
other Credit Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statement or
in any financial or other statements, instruments, reports, certificates or
any other documents in connection herewith or therewith furnished or made by
the Administrative Agent to the Banks or by or on behalf of the Company to
the Administrative Agent, or any Bank or be required to ascertain or inquire
as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained herein or therein or as to the
use of the proceeds of the Loans or of the existence or possible existence of
any Default or Event of Default.
10.04 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct and
to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation,
counsel to the Company), independent accountants and other experts selected
by the Administrative Agent. The Administrative Agent shall be fully
justified in failing or refusing to take any action under this Agreement or
any other Credit Document unless it shall first receive such advice or
concurrence of the Required Banks as it deems appropriate or it shall first
be indemnified to its satisfaction by the Banks against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and
the other Credit Documents in accordance with a request of the Required
Banks, and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Banks.
10.05 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has actually received notice
from a Bank or the
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Company referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default." In the event
that the Administrative Agent receives such a notice, the Administrative
Agent shall give prompt notice thereof to the Banks. The Administrative Agent
shall take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Banks; provided that, unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Banks.
10.06 Non-Reliance on Administrative Agent and Other Banks. Each
Bank expressly acknowledges that neither the Administrative Agent nor any of its
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates have made any representations or warranties to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Company or any of its Subsidiaries, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Bank. Each Bank
represents to the Administrative Agent that it has, independently and without
reliance upon the Administrative Agent or any other Bank, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other condition, prospects and creditworthiness of the Company and its
Subsidiaries and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Bank also represents that it will, independently and
without reliance upon the Administrative Agent or any other Bank, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement, and to make such investigation as it
deems necessary to inform itself as to the business, assets, operations,
property, financial and other condition, prospects and creditworthiness of the
Company and its Subsidiaries. The Administrative Agent shall not have any duty
or responsibility to provide any Bank with any credit or other information
concerning the business, operations, assets, property, financial and other
condition, prospects or creditworthiness of the Company or any of its
Subsidiaries which may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
10.07 Indemnification. The Banks agree to indemnify the
Administrative Agent in its capacity as such ratably according to their
respective "percentages" (which shall equal, for each Non-Defaulting Bank, that
percentage determined by (i) if prior to the Conversion Date, dividing such
Bank's Revolving Loan Commitment by the Adjusted
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Total Commitment or (ii) if the Conversion Date has occurred, dividing the
outstanding principal amount of such Bank's Term Loans by (x) the total
aggregate principal amount of Term Loans less (y) any Term Loans of
Defaulting Banks, it being understood and agreed that references in clause
(i) above to Revolving Loan Commitments (as well as to the Adjusted Total
Commitment) at a time when any such Revolving Loan Commitment (or Adjusted
Total Commitment) has been terminated shall be references to such terminated
Revolving Loan Commitment (or Adjusted Total Commitment, as the case may be)
as in effect immediately prior to such termination), from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, reasonable expenses or disbursements of any kind whatsoever
which may at any time (including, without limitation, at any time following
the payment of the Obligations) be imposed on, incurred by or asserted
against the Administrative Agent in its capacity as such in any way relating
to or arising out of this Agreement or any other Credit Document, or any
documents contemplated by or referred to herein or the transactions
contemplated hereby or any action taken or omitted to be taken by the
Administrative Agent under or in connection with any of the foregoing, but
only to the extent that any of the foregoing is not paid by the Company or
any of its Subsidiaries; provided that no Bank shall be liable to the
Administrative Agent for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting solely from the gross negligence or
willful misconduct of the Administrative Agent. If and to the extent any
amount paid to the Administrative Agent is subsequently recovered by the
Administrative Agent from the Company or any of its Subsidiaries, the
Administrative Agent shall promptly pay to each Bank to the extent such Bank
paid the Administrative Agent, its "percentage" of the amount so recovered.
If any indemnity furnished to the Administrative Agent for any purpose shall,
in the opinion of the Administrative Agent be insufficient or become
impaired, the Administrative Agent may call for additional indemnity and
cease, or not commence, to do the acts indemnified against until such
additional indemnity is furnished. The agreements in this Section 10.07 shall
survive the payment of all Obligations.
10.08 Administrative Agent in Its Individual Capacity. The
Administrative Agent and its respective affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Company
and its Subsidiaries as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to the Loans made by it and all
Obligations owing to it, the Administrative Agent shall have the same rights
and powers under this Agreement as any Bank and may exercise the same as
though it were not the Administrative Agent, and the terms "Bank" and "Banks"
shall include the Administrative Agent in its individual capacity.
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10.09 Holders. The Administrative Agent may deem and treat the payee
of any Note which has been issued hereunder as the owner thereof for all
purposes hereof unless and until a written notice of the assignment, transfer or
endorsement thereof, as the case may be, shall have been filed with the
Administrative Agent. Any request, authority or consent of any Person or entity
who, at the time of making such request or giving such authority or consent, is
the holder of any such Note shall be conclusive and binding on any subsequent
holder, transferee, assignee or indorsee, as the case may be, of such Note or of
any Note or Notes issued in exchange therefor.
10.10 Resignation of the Administrative Agent; Successor Agent. The
Administrative Agent may resign as the Administrative Agent upon 20 days' notice
to the Banks. Upon the resignation of the Administrative Agent, the Required
Banks shall appoint from among the Banks a successor Administrative Agent for
the Banks subject to prior approval by the Company (such approval not to be
unreasonably withheld), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall include such successor agent effective upon its
appointment, and the resigning Administrative Agent's rights, powers and duties
as the Administrative Agent shall be terminated, without any other or further
act or deed on the part of such former Administrative Agent or any of the
parties to this Agreement. After the resignation of the Administrative Agent
hereunder, the provisions of this Section 10 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.
SECTION 11. Miscellaneous.
11.01 Payment of Expenses, etc. The Company agrees to: (i) whether
or not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Administrative Agent (including, without
limitation, the reasonable fees and disbursements of White & Case) in connection
with the negotiation, preparation, execution and delivery of the Credit
Documents and the documents and instruments referred to therein and any
amendment, waiver or consent relating thereto and in connection with the
Administrative Agent's syndication efforts with respect to this Agreement; (ii)
pay all reasonable out-of-pocket costs and expenses of the Administrative Agent
and each of the Banks in connection with the enforcement of the Credit Documents
and the documents and instruments referred to therein and, after an Event of
Default shall have occurred and be continuing, the protection of the rights of
the Administrative Agent and each of the Banks thereunder (including, without
limitation, the reasonable fees and disbursements of counsel (including in-house
counsel) for the Administrative
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Agent and for each of the Banks); (iii) pay and hold each of the Banks
harmless from and against any and all present and future stamp and other
similar taxes with respect to the foregoing matters and save each of the
Banks harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent attributable
to such Bank) to pay such taxes; and (iv) indemnify the Administrative Agent
and each Bank, its officers, directors, employees, representatives and agents
from and hold each of them harmless against any and all losses, liabilities,
claims, damages or expenses incurred by any of them as a result of, or
arising out of, or in any way related to, or by reason of, any investigation,
litigation or other proceeding (whether or not the Administrative Agent or
any Bank is a party thereto) related to the entering into and/or performance
of any Credit Document or the use of the proceeds of any Loans hereunder or
the consummation of any other transactions contemplated in any Credit
Document including, without limitation, the reasonable fees and disbursements
of counsel incurred in connection with any such investigation, litigation or
other proceeding (but excluding any such losses, liabilities, claims, damages
or expenses to the extent incurred by reason of the gross negligence or
willful misconduct of the Person to be indemnified).
11.02 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, each Bank is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to the Company or any of its Subsidiaries or
to any other Person, any such notice being hereby expressly waived, to set off
and to appropriate and apply any and all deposits (general or special) and any
other Indebtedness at any time held or owing by such Bank (including, without
limitation, by branches and agencies of such Bank wherever located) to or for
the credit or the account of any Credit Party against and on account of the
Obligations and liabilities of such Credit Party to such Bank under this
Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations of such Credit Party purchased by such
Bank pursuant to Section 11.06(b), and all other claims of any nature or
description arising out of or connected with this Agreement or any other Credit
Document, irrespective of whether or not such Bank shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured.
11.03 Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including facsimile communication) and mailed, facsimilied or delivered, if to
the Company, at the address specified opposite its signature below or in the
other relevant Credit Documents, as the case may be; if to any Bank, at its
address specified for such Bank on Annex II hereto;
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or, at such other address as shall be designated by any party in a written
notice to the other parties hereto. All such notices and communications shall
be mailed, facsimilied or cabled or sent by overnight courier, and shall be
effective when received.
11.04 Benefit of Agreement. (a) This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided that the Company may assign or transfer
any of its respective rights or obligations hereunder without the prior written
consent of the Banks. Each Bank may at any time grant participations in any of
its rights hereunder to another financial institution; provided further, that,
in the case of any such participation, the participant shall not have any rights
under this Agreement or any of the other Credit Documents (the participant's
rights against such Bank in respect of such participation to be those set forth
in the agreement executed by such Bank in favor of the participant relating
thereto) and all amounts payable by the Company hereunder shall be determined as
if such Bank had not sold such participation, except that the participant shall
be entitled to receive the additional amounts under Sections 1.10, 1.11 and 3.04
of this Agreement to, and only to, the extent that such Bank would be entitled
to such benefits if the participation had not been entered into or sold; and
provided further, that no Bank shall transfer, grant or assign any participation
under which the participant shall have rights to approve any amendment to or
waiver of this Agreement or any other Credit Document except to the extent such
amendment or waiver would (i) extend the final scheduled maturity of any Loan in
which such participant is participating (it being understood that any waiver of
an installment on, or the application of any prepayment or the method of
application of any prepayment to the amortization of the Loans shall not
constitute an extension of the final scheduled maturity date), or reduce the
rate or extend the time of payment of interest or Fees thereon (except in
connection with a waiver of the applicability of any post-default increase in
interest rates), or reduce the principal amount thereof, or increase such
participant's participating interest in any Revolving Loan Commitment over the
amount thereof then in effect (it being understood that a waiver of any Default
or Event of Default or of a mandatory reduction in the Total Revolving Loan
Commitment shall not constitute a change in the terms of any Revolving Loan
Commitment and that an increase in any Revolving Loan Commitment shall be
permitted without the consent of any participant if such participant's
participation is not increased as a result thereof), (ii) release all or
substantially all of the Subsidiary Guarantors from the Subsidiary Guaranty
(except as expressly provided in the Credit Documents) or (iii) in each case
consent to the assignment or transfer by the Company or any other Subsidiaries
of the Company of any of its rights and obligations under this Agreement or any
other Credit Document except in accordance with the terms hereof and thereof.
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(b) Notwithstanding the foregoing, (x) any Bank may assign all or a
portion of its Loans and/or Revolving Loan Commitment and its rights and
obligations hereunder to its parent corporation and/or any affiliate of such
Bank which is at least 50% owned by such Bank and/or its parent company and (y)
with the consent of the Administrative Agent and the Company (which consents
shall not be unreasonably withheld, it being understood that the Company may
withhold its consent if the result of any such assignment is that the assigning
Bank and/or the assignee Bank will not have a pro rata exposure in this
Agreement and the Additional Credit Agreement), any Bank may assign all or a
portion of its Loans and/or Revolving Loan Commitment and its rights and
obligations hereunder to one or more commercial banks or other financial
institutions (including one or more Banks). No assignment pursuant to the
immediately preceding sentence shall (x) to the extent such transaction
represents an assignment to an institution other than one or more Banks
hereunder, be in an aggregate amount less than the minimum of $10,000,000 or (y)
so long as no Default or Event of Default then exists, reduce the Revolving Loan
Commitments and/or Term Loans of the assigning Bank to an aggregate amount less
than the Minimum Retention Amount unless the same are reduced to $0. If any Bank
so sells or assigns all or a part of its rights hereunder, any reference in this
Agreement or the other Credit Documents to such assigning Bank shall thereafter
refer to such Bank and to the respective assignee Bank to the extent of their
respective interests and the respective assignee Bank shall have, to the extent
of such assignment (unless otherwise provided therein), the same rights and
benefits as it would if it were such assigning Bank. Each assignment pursuant to
this Section 11.04(b) shall be effected by the assigning Bank and the assignee
Bank executing an Assignment and Assumption Agreement substantially in the form
of Exhibit F (appropriately completed). At the time of any such assignment, (i)
if such assignment occurs prior to the Conversion Date, Annex I shall be deemed
to be amended to reflect the Revolving Loan Commitments of the respective
assignee Bank (which shall result in a direct reduction to the respective
Revolving Loan Commitments of the assigning Bank) and of the other Banks, (ii)
the Administrative Agent shall record such assignment and the resultant effects
thereof on the Loans and/or Revolving Loan Commitments of the assigning Bank and
the assignee Bank in the Register and (iii) the Administrative Agent shall
receive from the assigning Bank and/or the assignee Bank at the time of each
assignment the payment of a nonrefundable assignment fee in an aggregate amount
of $3,000 with respect to each such assignment (provided that in the event of
simultaneous assignments relating to this Agreement and the Additional Credit
Agreement, the fees for such assignments shall total $3,000). Each Bank and the
Company agree to execute such documents (including, without limitation,
amendments to this Agreement and the other Credit Documents) as shall be
necessary to effect the foregoing. Promptly following any assignment pursuant to
this Section 11.04(b), the assigning Bank shall promptly notify
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the Company thereof. Nothing in this Section 11.04(b) shall prevent or
prohibit any Bank from pledging its Loans or, if issued, Notes hereunder to a
Federal Reserve Bank in support of borrowings made by such Bank from such
Federal Reserve Bank.
(c) Notwithstanding any other provisions of this Section 11.04, no
transfer or assignment of the interests or obligations of any Bank hereunder or
any grant of participations therein shall be permitted if such transfer,
assignment or grant would require the Company to file a registration statement
with the SEC or to qualify the Loans under the "Blue Sky" laws of any State.
11.05 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Administrative Agent or any Bank in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Company and the Administrative Agent or any Bank shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies which the Administrative
Agent or any Bank would otherwise have. No notice to or demand on the Company in
any case shall entitle the Company to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Banks to any other or further action in any
circumstances without notice or demand.
11.06 Payments Pro Rata. (a) The Administrative Agent agrees that
promptly after its receipt of each payment from or on behalf of the Company in
respect of any Obligations of the Company hereunder, it shall, except as
otherwise provided in this Agreement, distribute such payment to the Banks
(other than any Bank that has consented in writing to waive its pro rata share
of such payment) pro rata based upon their respective shares, if any, of the
Obligations with respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans or Fees, of a sum which with respect to the related sum or sums
received by other Banks is in a greater proportion than the total of such
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Obligation then owed and due to such Bank bears to the total of such
Obligation then owed and due to all of the Banks immediately prior to such
receipt, then such Bank receiving such excess payment shall purchase for cash
without recourse or warranty from the other Banks an interest in the
Obligations of the Company to such Banks in such amount as shall result in a
proportional participation by all of the Banks in such amount; provided that
if all or any portion of such excess amount is thereafter recovered from such
Bank, such purchase shall be rescinded and the purchase price restored to the
extent of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 11.06(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
11.07 Calculations; Computations. (a) The financial statements to be
furnished to the Banks pursuant hereto shall be made and prepared in accordance
with GAAP consistently applied throughout the periods involved (except as set
forth in the notes thereto or as otherwise disclosed in writing by the Company
to the Banks); provided that except as otherwise specifically provided herein,
all computations determining compliance with Section 7, including definitions
used therein, shall utilize accounting principles and policies in effect at the
time of the preparation of, and in conformity with those used to prepare, the
December 31, 1995 historical financial statements delivered to the Banks
pursuant to Section 6.10(a); provided further, that in the event that the
Accounting Standards Executive Committee of the AICPA adopts the statement of
position (substantially in the proposed form as of the Effective Date) relating
to computer software developed or obtained for internal use, and the Company's
independent auditors concur with such accounting change as it relates to the
presentation of the Company's financial statements, then compliance with Section
8 will thereafter be determined giving effect to such statement of position.
(b) All computations of interest (other than interest on Base Rate
Loans) and Fees hereunder shall be made on the actual number of days elapsed
over a year of 360 days. All computations of interest on Base Rate Loans
hereunder shall be made on the actual number of days elapsed over a year of 365
days.
11.08 Governing Law; Submission to Jurisdiction; Venue. (a) THIS
AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAW OF THE STATE OF NEW YORK. Any legal action or proceeding
with
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respect to this Agreement or any other Credit Document may be brought in the
courts of the State of New York or of the United States for the Southern
District of New York, and, by execution and delivery of this Agreement, the
Company hereby irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of the aforesaid courts. The
Company hereby further irrevocably waives any claim that any such courts lack
jurisdiction over the Company, and agrees not to plead or claim, in any legal
action or proceeding with respect to this Agreement or any other Credit
Document brought in any of the aforesaid courts, that any such court lacks
jurisdiction over the Company. The Company irrevocably consents to the
service of process in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to the Company, at
its address for notices pursuant to Section 11.03, such service to become
effective 30 days after such mailing. The Company hereby irrevocably waives
and agrees not to plead or claim in any action or proceeding commenced
hereunder or under any other Credit Document that service of process was in
any way invalid or ineffective. The Company hereby represents and warrants
that its chief executive office is located at 745 Fifth Avenue, New York, New
York 10151, and the Company hereby further agrees that it shall not move its
chief executive office unless it shall give the Administrative Agent not less
than 30 days' prior written notice of its intention so to do. The Company
agrees that (x) prior to moving its chief executive office outside New York
City and (y) and if for any reason any designee, appointee and agent
previously appointed pursuant to this sentence shall cease to be available to
act as such, the Company shall designate a designee, appointee and agent or
replacement designee, appointee and agent, as the case may be, in New York
City on the terms and for the purposes of this provision satisfactory to the
Administrative Agent. Nothing herein shall affect the right of the
Administrative Agent, any Bank or the holder of any Note to serve process in
any other manner permitted by law or to commence legal proceedings or
otherwise proceed against the Company in any other jurisdiction.
(b) The Company hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in clause (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such court
that any such action or proceeding brought in any such court has been brought in
an inconvenient forum.
11.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together
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constitute one and the same instrument. A complete set of counterparts
executed by all the parties hereto shall be lodged with the Company and the
Administrative Agent.
11.10 Effectiveness. This Agreement shall become effective on the
date (the "Effective Date") on which the Company, the Administrative Agent
and each of the Banks shall have signed a copy hereof (whether the same or
different copies) and shall have delivered the same to the Administrative
Agent at its Notice Office or, in the case of the Banks, shall have given to
the Administrative Agent telephonic (confirmed in writing), written or
facsimile notice (actually received) at such office that the same has been
signed and mailed to it. The Administrative Agent will give the Company and
each Bank prompt written notice of the occurrence of the Effective Date.
11.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
11.12 Amendment or Waiver. Neither this Agreement nor any other
Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the Company and the Required Banks; provided that no such
change, waiver, discharge or termination shall, without the consent of each Bank
(other than a Defaulting Bank) affected thereby, (i) extend any Scheduled TL
Repayment Date or reduce the amount of any Scheduled TL Repayment or extend the
final scheduled maturity of any Loan (it being understood that any waiver of the
application of any prepayment of or the method of application of any prepayment
to the amortization of the Loans shall not constitute any such extension), or
reduce the rate or extend the time of payment of interest (other than as a
result of waiving the applicability of any post- default increase in interest
rates) or Fees thereon, or reduce the principal amount thereof, or increase the
Revolving Loan Commitments of any Bank over the amount thereof then in effect
(it being understood that a waiver of any Default or Event of Default or of a
mandatory repayment or reduction in the Total Revolving Loan Commitment shall
not constitute a change in the terms of any Commitment of any Bank), (ii)
release all or substantially all of the Subsidiary Guarantors from the
Subsidiary Guaranty (except as expressly provided in the Credit Documents) and
(iii) amend, modify or waive any provision of this Section, or Section 1.10,
1.11, 3.04, 8.01, 10.07, 11.01, 11.02, 11.04, 11.06 or 11.07(b), (iv) reduce the
percentage specified in, or otherwise modify, the definition of, Required Banks,
or (v) consent to the assignment or transfer by any Credit Party of any of its
rights and obligations under this Agreement or any other Credit Document except
in
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accordance with the terms hereof or thereof. No provision of Section 11 may
be amended without the consent of the Administrative Agent.
11.13 Survival. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 3.04, 10.07 or 11.01, shall survive the
execution and delivery of this Agreement and the making and repayment of the
Loans and the satisfaction of all other Obligations.
11.14 Domicile of Loans. Each Bank may transfer and carry its Loans
at, to or for the account of any branch office, subsidiary or affiliate of such
Bank, provided, that the Company shall not be responsible for costs arising
under Sections 1.10, 1.11 or 3.04 resulting from any such transfer (other than a
transfer pursuant to Section 1.12) to the extent such costs would not otherwise
be applicable to such Bank in the absence of such transfer.
11.15 Confidentiality. Each of the Banks agrees that it will use its
best efforts not to disclose without the prior consent of the Company (other
than to its employees, auditors, counsel or other professional advisors, to
affiliates or to another Bank if the Bank or such Bank's holding or parent
company in its sole discretion determines that any such party should have access
to such information) any information with respect to the Company or any of its
Subsidiaries which is furnished pursuant to this Agreement and which is
designated by the Company to the Banks in writing as confidential, provided that
any Bank may disclose any such information (a) as has become generally available
to the public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state, provincial or Federal regulatory
body having or claiming to have jurisdiction over such Bank or to the Federal
Reserve Board or the Federal Deposit Insurance Corporation or similar
organizations (whether in the United States or elsewhere) or their successors,
(c) as may be required or appropriate in response to any summons or subpoena or
in connection with any litigation, (d) in order to comply with any law, order,
regulation or ruling applicable to such Bank, and (e) to any prospective
transferee in connection with any contemplated transfer of any of the Loans
and/or Revolving Loan Commitments or any interest herein by such Bank, provided
that such prospective transferee agrees to be bound by the provisions of this
Section.
11.16 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS
AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
OTHER CREDIT
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DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the date
first above written.
Address:
745 Fifth Avenue
New York, NY 10151 K-III COMMUNICATIONS
CORPORATION
Telephone No.: (212) 745-0101
Telecopier No.: (212) 745-0199 By______________________________________
Attention: Beverly Chell, Esq. Title: Treasurer
THE CHASE MANHATTAN
BANK, N.A., Individually
and as Administrative Agent
By______________________________________
Title:
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BANKERS TRUST COMPANY,
Individually and as
Co-Syndication Agent
By______________________________________
Title:
THE BANK OF NEW YORK,
Individually and as
Co-Syndication Agent
By______________________________________
Title:
THE BANK OF NOVA SCOTIA,
Individually, as Canadian Lender
and as Documentation Agent
By______________________________________
Title:
BANK OF AMERICA NT&SA
By______________________________________
Title:
FLEET NATIONAL BANK
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By______________________________________
Title:
MIDLAND BANK plc,
NEW YORK BRANCH
By______________________________________
Title:
SOCIETE GENERALE
By______________________________________
Title:
THE INDUSTRIAL BANK OF
JAPAN, LIMITED
By______________________________________
Title:
ROYAL BANK OF CANADA
By______________________________________
Title:
CIBC INC.
By______________________________________
Title:
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LTCB TRUST COMPANY
By______________________________________
Title:
MELLON BANK, N.A.
By______________________________________
Title:
NATIONSBANK OF TEXAS, N.A.
By______________________________________
Title:
THE DAI-ICHI KANGYO BANK, LTD.,
NEW YORK BRANCH
By______________________________________
Title:
THE MITSUBISHI TRUST AND
BANKING CORPORATION
By______________________________________
Title:
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THE SAKURA BANK, LIMITED,
NEW YORK BRANCH
By______________________________________
Title:
TORONTO DOMINION (NEW YORK),
INC.
By______________________________________
Title:
CREDIT LYONNAIS
NEW YORK BRANCH
By______________________________________
Title:
BANK OF MONTREAL
By______________________________________
Title:
CAISSE NATIONALE DE
CREDIT AGRICOLE
By______________________________________
Title:
-101-
THE SUMITOMO TRUST AND
BANKING CO., LTD.,
NEW YORK BRANCH
By______________________________________
Title:
UNION BANK OF CALIFORNIA, N.A.
By______________________________________
Title:
UNITED JERSEY BANK
By______________________________________
Title:
BANQUE PARIBAS
By______________________________________
Title:
By______________________________________
Title:
-102-
CREDIT SUISSE
By______________________________________
Title:
By______________________________________
Title:
MERITA BANK LTD.
By______________________________________
Title:
SIGNET BANK
By______________________________________
Title:
THE SANWA BANK, LIMITED,
NEW YORK BRANCH
By______________________________________
Title:
BANK OF IRELAND,
GRAND CAYMAN BRANCH
By______________________________________
Title:
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THE YASUDA TRUST AND BANKING
CO., LTD., NEW YORK BRANCH
By______________________________________
Title:
-104-
ANNEX I
LIST OF BANKS
Revolving Loan
Bank Commitment
- ---- --------------
The Chase Manhattan Bank, N.A. $ 20,000,000
Bankers Trust Company 15,000,000
The Bank of New York 15,000,000
The Bank of Nova Scotia 15,000,000
Bank of America NT&SA 12,000,000
Fleet National Bank 12,000,000
Midland Bank plc, New York Branch 12,000,000
Societe Generale 12,000,000
The Industrial Bank of
Japan, Limited 12,000,000
Royal Bank of Canada 10,000,000
CIBC Inc. 8,000,000
LTCB Trust Company 8,000,000
Mellon Bank, N.A. 8,000,000
NationsBank of Texas, N.A. 8,000,000
The Dai-Ichi Kangyo Bank, Ltd., 8,000,000
New York Branch
The Mitsubishi Trust and 8,000,000
Banking Corporation
The Sakura Bank, Limited, 8,000,000
New York Branch
Toronto Dominion (New York), Inc. 8,000,000
Credit Lyonnais 7,000,000
New York Branch
ANNEX I
Page 2
Revolving Loan
Bank Commitment
- ---- --------------
Bank of Montreal 5,000,000
Caisse Nationale de Credit Agricole 5,000,000
The Sumitomo Trust and 5,000,000
Banking Co., Ltd.,
New York Branch
Union Bank of California, N.A. 5,000,000
United Jersey Bank 5,000,000
Banque Paribas 3,000,000
Credit Suisse 3,000,000
Merita Bank Ltd. 3,000,000
Signet Bank 3,000,000
The Sanwa Bank, Limited, 3,000,000
New York Branch
Bank of Ireland, Grand Cayman Branch 2,000,000
The Yasuda Trust and 2,000,000
Banking Co., Ltd., New York Branch
Total $250,000,000
============
ANNEX II
BANK ADDRESSES
Bank Address
- ---- -------
The Chase Manhattan Bank, N.A. 1 Chase Manhattan Plaza
New York, New York 10081
Telephone No.: (212) 552-3993
Telecopier No.: (212) 552-0259
Attention: James R. Kuster
Bankers Trust Company One Bankers Trust Plaza
New York, New York 10006
Telephone No.: (212) 250-7199
Telecopier No.: (212) 250-7200
Attention: Jeff Bennett
The Bank of New York 1 Wall Street
16th Floor
New York, New York 10286
Telephone No.: (212) 635-8608
Telecopier No.: (212) 635-8595
Attention: Ted Ryan
Bank of Nova Scotia One Liberty Plaza,
26th Floor
New York, New York 10006
Telephone No.: (212) 225-5042
Telecopier No.: (212) 225-5090
Attention: Vincent Fitzgerald
Canadian Notice Office and Canadian
Payment Office:
International Banking Division
Loan Administration and Agency Services
44 Kings Street West, 14th Floor
Toronto, Ontario
Canada M5H 1H1
Telephone No.: (416) 866-
5901/2816/4089
Telecopier No.: (416) 866-5991
Attention: Wallace Yeung/
Nancy Buccat/Nancy Tong
ANNEX II
Page 2
Bank of America NT&SA 335 Madison Avenue
5th Floor
New York, New York 10017
Telephone No.: (212) 503-8352
Telecopier No.: (212) 503-7173
Attention: Amy Trapp
Fleet National Bank 75 State Street
Boston, Massachusetts 02109
Telephone No.: (617) 346-3761
Telecopier No.: (617) 346-3777
Attention: Alex Ivanov
Midland Bank plc, 140 Broadway
New York Branch 5th Floor
New York, New York 10005
Telephone No.: (212) 658-2738
Telecopier No.: (212) 658-2586
Attention: Martin Brown
Societe Generale 1221 Avenue of the Americas
New York, New York 10020
Telephone No.: (212) 278-6852
Telecopier No.: (212) 278-6240
Attention: Elaine Khalil
The Industrial Bank of 245 Park Avenue
Japan, Limited 23rd Floor
New York, New York 10167
Telephone No.: (212) 309-6562
Telecopier No.: (212) 682-2870
Attention: Akira Yoshida
Royal Bank of Canada One Financial Square
New York, New York 10005-3531
Telephone No.: (212) 428-6288
Telecopier No.: (212) 428-6460
Attention: Barbara Meijer
CIBC Inc. 425 Lexington Avenue
6th Floor
New York, New York 10038
Telephone No.: (212) 856-3714
Telecopier No.: (212) 856-3558
Attention: Matt Jones
ANNEX II
Page 3
LTCB Trust Company 165 Broadway
49th Floor
New York, New York 10006
Telephone No.: (212) 335-4991
Telecopier No.: (212) 608-2371
Attention: Chris Fahey
Mellon Bank, N.A. One Mellon Bank Center
Room 4440
Pittsburgh, Pennsylvania 15258
Telephone No.: (412) 234-3697
Telecopier No.: (412) 234-6375
Attention: Stephen Viehe
NationsBank of Texas, N.A. Communications Finance Division
901 Main Street, 64th Floor
Dallas, Texas 75202
Telephone No.: (214) 508-0517
Telecopier No.: (214) 508-9390
Attention: Tony Cacheria
The Dai-Ichi Kangyo Bank, Ltd., One World Trade Center
New York Branch New York, New York 10048
Telephone No.: (212) 432-6655
Telecopier No.: (212) 524-0579
Attention: Michael Wellington
The Mitsubishi Trust and 520 Madison Avenue
Banking Corporation 26th Floor
New York, New York 10022
Telephone No.: (212) 891-8425
Telecopier No.: (212) 593-4691
Attention: Anthony Rock
The Sakura Bank, Limited, 277 Park Avenue
New York Branch 45th Floor
New York, New York 10172
Telephone No.: (212) 756-6774
Telecopier No.: (212) 888-7651
Attention: Stephen Chan
Toronto Dominion (New York), 31 West 52nd Street
Inc. New York, New York 10019
Telephone No.: (212) 468-0731
Telecopier No.: (212) 262-1928
Attention: David Oliver
ANNEX II
Page 4
with a copy to:
909 Fannin
Suite 1700
Houston, Texas 77010
Telephone No.: (713) 653-8242
Telecopier No.: (713) 951-9921
Attention: Jorge Garcia
Credit Lyonnais 1301 Avenue of the Americas
New York Branch New York, New York 10019
Telephone No.: (212) 261-7863
Telecopier No.: (212) 459-3176
Attention: Nick Bellamy
Bank of Montreal 430 Park Avenue
New York, New York 10022
Telephone No.: (212) 605-1426
Telecopier No.: (212) 605-1621
Attention: Allegra Griffiths
Caisse Nationale de Credit 520 Madison Avenue
Agricole New York, New York 10022
Telephone No.: (212) 418-2217
Telecopier No.: (212) 418-7004
Attention: John McCloskey
The Sumitomo Trust and 527 Madison Avenue
Banking Co., Ltd., New York, New York 10022
New York Branch Telephone No.: (212) 326-0716
Telecopier No.: (212) 418-4848
Attention: Mitchell Gervis
Union Bank of California, N.A. 445 South Figueroa Street
15th Floor
Los Angeles, California 90071
Telephone No.: (213) 236-5812
Telecopier No.: (213) 236-5747
Attention: Michael K. McShane
United Jersey Bank 25 East Salem Street
Hackensack, New Jersey 07602
Telephone No.: (201) 646-6189
Telecopier No.: (201) 343-6723
Attention: Bruce Gray
ANNEX II
Page 5
Banque Paribas 787 Seventh Avenue
New York, New York 10019
Telephone No.: (212) 841-2126
Telecopier No.: (212) 841-2369
Attention: Errol Artzis
Credit Suisse 12 East 49th Street
Tower 49
New York, New York 10017
Telephone No.: (212) 238-5458
Telecopier No.: (212) 238-5439
Attention: J. Hamilton Crawford
Merita Bank Ltd. 437 Madison Avenue
New York, New York 10022
Telephone No.: (212) 318-9561
Telecopier No.: (212) 421-4420
Attention: Frank Maffei
Signet Bank 7799 Leesburg Pike
Suite 500
Falls Church, Virginia 22043
Telephone No.: (703) 714-5016
Telecopier No.: (703) 506-9712
Attention: John Slabaugh
The Sanwa Bank, Limited, New Park Avenue Plaza
York Branch 55 East 52nd Street
New York, New York 10055
Telephone No.: (212) 339-6204
Telecopier No.: (212) 754-1304
Attention: Shayn March
Bank of Ireland, Grand Cayman 640 Fifth Avenue
Branch New York, New York 10019
Telephone No.: (212) 397-1712
Telecopier No.: (212) 307-5559
Attention: Roger Burns
The Yasuda Trust & Banking Co., 666 5th Avenue
Ltd., New York Branch 8th Floor
New York, New York 10103
Telephone No.: (212) 373-5713
Telecopier No.: (212) 373-5796
Attention: Rohn M. Laudenschlager
ANNEX III
SUBSIDIARIES
ANNEX IV
LIENS
ANNEX V
PART A. EXISTING DEBT
[To include existing Senior Notes and Non-Compete Notes]
PART B. EXISTING CONTINGENT OBLIGATIONS
ANNEX VI
EXISTING PREFERRED STOCK