EXHIBIT (d)(9)
REVOLVING CREDIT AGREEMENT
This Revolving Credit Agreement is dated as of July 15, 1993 between
Bertelsmann, Inc., a Delaware corporation (the "Borrower"), and Bayerische
Landesbank Girozentrale (the "Bank").
ARTICLE 1
AMOUNT AND TERMS OF REVOLVING CREDIT FACILITY
SECTION 1.01. Revolving Credit. The Bank agrees, under the terms of this
Revolving Credit Agreement (the "Agreement"), to make a series of loans (the
"Loans") available to the Borrower in the amount of up to US $50,000,000.00
(Fifty Million United States dollars and no cents) (the "Facility").
The Borrower may borrow, repay and reborrow in an aggregate principal
amount at any time outstanding not exceeding US $50,000,000.00, on or after the
date hereof and prior to the Maturity Date, as defined below, subject to the
terms, provisions and limitations set forth herein.
SECTION 1.02. Availability and Maturity. This Facility is available to the
Borrower for the period of five years plus one day beginning July 15, 1993 (the
"Effective Date") until July 16, 1998 (the "Maturity Date"). Upon each
anniversary date of the Effective Date (the "Review Date"), the Maturity Date
of the Facility will automatically extend by one year unless the Bank has
notified the Borrower in writing at the latest 60 days prior to the Review Date
that it desires to terminate the Facility 4 years plus 1 day from the
applicable Review Date. If the Bank does not provide the Borrower with such
notice of termination, it will be presumed that this Agreement will continue
under the terms herein for a period of 5 years plus 1 day from the applicable
Review Date. All borrowings and accrued interest under this Facility will be
repaid in full no later than the final Maturity Date.
SECTION 1.03. The Note. The Loans will be evidenced by a promissory note
from the Borrower (hereinafter called the "Note"), in the form of Exhibit A
attached hereto, duly completed, executed and dated the date of the Agreement,
payable to the order of the Bank and in a principal amount equal to the
Facility. The Note shall bear interest on the outstanding principal balance
thereof as set forth in Section 1.04.
SECTION 1.04. Borrowing Options. (a) LIBOR Loans: (i) Each LIBOR Loan
shall bear interest at the sum of the LIBO Rate for such Interest Period plus
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.1875% per annum. Interest Period means the period commencing on the date of
such Loan and ending on the last day of the period selected by the Borrower.
The duration of each such Interest Period shall be one, two, three, or six
months, in each case as the Borrower may select.
(ii) LIBOR loans shall bear interest computed on the basis of the
actual number of days elapsed in a year of 360 days. Interest shall be
payable on each LIBOR Loan on the last day of the Interest Period for each
such LIBOR Loan, and, if such Interest Period has a duration of more than
three months, on each day which occurs during such Interest Period every
three months from the first day of such Interest Period.
(iii) Whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest
Period shall be extended to the next Business Day, unless such extension
would cause the last day of such Interest Period to occur in the next
following calendar month, then the last day of such Interest Period shall
occur on the next preceding Business Day.
(iv) The Borrower may not select an Interest Period for any LIBOR
Loan if the last day of such Interest Period would be later than the
Maturity Date.
(v) The outstanding principal balance of each LIBOR Loan shall be
payable on the last day of the Interest Period applicable to such LIBOR
Loan.
(b) Fixed Rate Loans: (i) the Borrower shall have the option to make
borrowings at a fixed rate of interest at the inception of the Facility or any
time during the life of the Facility, subject to availability. The duration of
each such Fixed Rate Loan shall be selected by the Borrower.
(ii) Fixed Rate Loans shall bear interest computed on the basis of
the actual number of days elapsed in a year of 360 days. Interest shall be
payable on each Fixed Rate Loan in arrears semi-annually as long as the
Fixed Rate Loan is outstanding with the final interest payment due at the
maturity of such Fixed Rate Loan.
(iii) Whenever the last day of any Fixed Rate Loan would otherwise
occur on a day other than a Business Day, the last day of such Fixed Rate
Loan shall be extended to the next Business Day.
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(iv) The Borrower may not select a maturity date for any Fixed Rate
Loan beyond the Maturity Date of the Facility.
(v) The outstanding Principal balance of each Fixed Rate Loan shall
be payable at the maturity of such Fixed Rate Loan.
SECTION 1.05. Loans. (a) The Loans made by the Bank on any one date shall
be in a minimum aggregate principal amount of $1,000,000 or if greater, in an
integral multiple of $100,000.
(b) The Borrower shall give the Bank prior written or telephonic notice of
each Loan under Section 1.01; such notice shall be irrevocable and shall
specify (i) the aggregate amount of the proposed borrowing, (ii) the date
thereof (which shall be a Business Day), and (iii) the Interest Period with
respect thereto.
In the case of any LIBOR Loan commencing on the last Business Day of any
month, the Bank reserves the right to require two days prior written or
telephonic notice of such Loan from the Borrower. In such case, if the Bank
does not receive two days prior written or telephonic notice from the Borrower,
the Bank reserves the right to set the interest rate subject to availability.
SECTION 1.06. Commitment Fee. The Borrower agrees to pay to the Bank a
commitment fee of .07% per annum on the average daily unused portion of the
Facility (computed on the basis of the actual number of days elapsed in a year
of 360 days). The Commitment Fee shall be payable in arrears, on the last day
of each calendar quarter commencing September 30, 1993, and on the Maturity
Date.
SECTION 1.07. Prepayment. If the Borrower shall for any reason prepay any
Loan prior to its stated maturity, the Borrower shall pay to the Bank, on
demand, an amount equal to the present value of the difference of: (a) the
aggregate amount of interest which would have otherwise been payable on such
Loan from the date of such prepayment to the date of maturity of such Loan,
minus (b) the aggregate amount of interest the Bank would earn if the amount
prepaid were reinvested for the period from the date of such prepayment to the
scheduled maturity of such Loan at the Treasury Rate. The "Treasury Rate" shall
mean a rate per annum (computed on the basis of actual days elapsed and a year
of 360 days), determined by the Bank in New York City on the date of prepayment
to be the yield expressed as the rate in the secondary market in U.S. Treasury
Securities having substantially the same term to maturity as the amount prepaid
(see Exhibit B for sample calculation).
A determination by the Bank as to the amount payable pursuant to this
Section 1.07 shall be conclusive, provided such determination is made in good
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faith. The Bank will furnish the Borrower with a certificate setting forth the
basis and the amount of compensation under this Section and such certificate
shall be prima facie evidence of the amounts due to the Bank absent manifest
error.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Representations and Warranties. The Borrower hereby
represents and warrants that:
(a) The audited financial statements of the Borrower for the fiscal year
ended June 30, 1992, have been furnished to the Bank. Since June 30, 1992,
there has been no material adverse change in the business or financial
condition of the Borrower.
(b) The Borrower will use the proceeds of the Loans for general corporate
purposes. No part of the proceeds of the Loans will be used to purchase or
carry margin stock as such terms are used in Regulation U of the Board of
Governors of the Federal Reserve System or to extend credit to others for the
purpose of purchasing or carrying margin stock, and the use of such Loans shall
not result in any violation of Regulations U or X of said Board.
ARTICLE 3
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent. The Bank shall not be obligated to
make the Loans unless:
(a) It shall have received the Note from the Borrower, dated the date of
the Agreement and otherwise properly completed;
(b) It shall have received copies of all corporate resolutions of the
Borrower authorizing the execution, delivery and performance of this Agreement
certified by the Secretary or an Assistant Secretary of the Borrower;
(c) It shall have received a certificate from the Secretary or Assistant
Secretary of the Borrower specifying the name and titles, and including the
specimen signatures, of the officers authorized to sign this Revolving Credit
Agreement and the Note;
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(d) It shall have received a Letter of Comfort from Bertelsmann AG
substantially in the form attached hereto as Exhibit C;
(e) No event specified in Article 5 shall have occurred and be continuing
or would exist immediately thereafter (any borrowing hereunder is to be a
certification to the effect that no such event has occurred and is continuing
or would exist immediately thereafter).
ARTICLE 4
COVENANTS
SECTION 4.01. Notices. The Borrower shall promptly notify the Bank of any
material adverse change in its business or financial condition and of any event
specified in Article 5 of which it has knowledge and that will affect the
Borrower's ability to perform hereunder.
SECTION 4.02. Reporting Requirements. (a) The Borrower shall provide the
Bank with a balance sheet, income statement and statement of changes in
financial position, within 120 days of the end of its fiscal year prepared in
accordance with generally accepted accounting principles. Annual statements
shall be audited by an independent accountant.
(b) The Borrower shall provide the Bank with the annual published
financial report of Bertelsmann AG as soon as available.
SECTION 4.03. Other Information. The Borrower shall provide the Bank with
such other financial information as the Bank shall reasonably request.
SECTION 4.04. Pari Passu Clause. The Borrower shall ensure that at all
times its obligations hereunder and under the Note rank at least pari passu in
right of payment with all similar unsecured funded debt of the Borrower now or
hereafter outstanding, except for the guaranteed debt set forth on the attached
Schedule (Exhibit D). The Borrower agrees not to permit an increase in any
guaranty set forth in the attached Schedule and no guaranty will be created
hereafter unless the Borrower agrees to put the Bank on a pari passu basis.
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ARTICLE 5
EVENTS OF DEFAULT
SECTION 5.01. Events of Default. If any one of the following events shall
occur while the Loans are outstanding:
(a) Failure to pay any principal amount when due, or interest or other
amount within three (3) banking days of the date they are due hereunder and
such default continues for 10 Business Days after receipt of written notice
from the Bank to the Borrower; or
(b) Any representation or warranty made or deemed made by the Borrower
herein, in any Loan or in any statement or certificate furnished by the
Borrower in connection with this Agreement, or by Bertelsmann AG in the Letter
of Comfort proves to have been incorrect, in any material respect, when made or
deemed made; or
(c) The Borrower fails to observe the agreements contained in Article 4
hereof; or
(d) The Borrower fails to observe any other provision of this Agreement,
and such failure continues unremedied for a period of thirty days after receipt
of written notice from the Bank to the Borrower from the date of occurrence; or
(e) Bankruptcy, reorganization, or insolvency proceedings, or any
proceeding looking toward dissolution or winding-up as a result of insolvency,
are instituted by or against the Borrower under the law of any jurisdiction; or
the Borrower becomes insolvent (however such insolvency may be evidenced); or
the Borrower shall admit in writing its inability, or is generally unable, to
pay its debts as they become due, provided the foregoing proceedings are not
stayed or dismissed within 120 days; or
(f) The Borrower shall fail to make any payment in respect of any bank
debt in excess of ;10 Million U.S. dollars when due or within the applicable
grace period, if any or any event shall occur which results in the acceleration
of the maturity of any such debt of the Borrower or enables the holder of any
such debt to accelerate the maturity thereof, unless such debt is being
contested in good faith;
then, unless the Bank shall otherwise elect, the full unpaid principal amount
outstanding hereunder and accrued interest thereon shall become immediately due
and payable.
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ARTICLE 6
MISCELLANEOUS
SECTION 6.01. Change in Regulation or Market Situation. In the event that
applicable law or regulation, or any change therein or in the interpretation
thereof by any governmental authority charged with the administration thereof,
shall impose, modify or deem applicable any reserve requirements against assets
held by or deposits in or for the account of, or advances or loans by the Bank
or shall impose any other condition with respect to this Agreement and the
result of any of the foregoing is to increase the cost to the Bank of funding
the principal sum hereof, then the Bank may, without prior consent of the
Borrower, at any time sell, assign, or transfer the Loans to any other lending
office of the Bank to the effect that the cost of the Loans will not be higher
as originally agreed upon draw down, provided that such sale, assignment or
transfer will not increase the Borrower's cost under this Agreement or
negatively impact the Borrower in any unreasonable way.
SECTION 6.02. Amendments, Waivers. No amendment of any provision of this
Agreement nor consent to any departure therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Bank and the
Borrower. A waiver by the Bank or the Borrower of any provision of this
Agreement shall only be effective if in writing and signed by the Bank.
SECTION 6.03. Survival. All representations and warranties made herein
shall survive the making of the Loans hereunder and the issuance and delivery
to the Bank of the Note hereunder and shall continue in full force and effect
so long as any amount due or to become due hereunder is outstanding and unpaid
and so long as the Facility has not been terminated.
SECTION 6.04. Usury. Anything herein to the contrary notwithstanding, the
obligations of the Borrower under this Agreement shall be subject to the
limitation that payments of interest shall not be required to the extent that
receipt thereof would be contrary to provisions of law applicable to the Bank
limiting rates of interest which may be charged or collected by the Bank.
SECTION 6.05. Governing Law. This Agreement shall be deemed to have been
made under the laws of the State of New York, and shall be governed by and
construed in accordance with the laws of said state.
SECTION 6.06. Notices. Notices shall be given to the Bank and the Borrower
by ordinary mail or telefax addressed to:
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The Bank: Bayerische Landesbank Girozentrale
560 Lexington Avenue
New York, New York 10022
Attn.: P. Obermann
The Borrower: Bertelsmann, Inc.
1540 Broadway
New York, New York 10036
Attn.: Mr. Basil Mavrovitis,
CCM, CCE Treasurer
Notices shall be effective upon receipt.
SECTION 6.07. Fees and Expenses. The Borrower will pay all reasonable
legal fees and expenses incurred by the Bank as a result of actions the Bank
takes with respect to the enforcement of this Agreement and the Note issued
hereunder. For purposes of this Section 6.07 reasonable legal fees and expenses
shall not exceed $2,500.00.
SECTION 6.08. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles as in effect on the date the financial data is prepared,
and all financial data shall be prepared in accordance with such principles.
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IN WITNESS WHEREOF, the parties hereto have caused this Revolving Credit
Agreement to be duly executed as of the day and year first written above.
Bayerische Landesbank Girozentrale
By:
---------------------------------
Peter Obermann
First Vice President
Manager Corporate Finance
By:
---------------------------------
Wilfried Freudenberger
Executive Vice President and General Manager
Bertelsmann Inc.
---------------------------------
By:
---------------------------------
Title:
------------------------------
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July 15, 1993 EXHIBIT A
PROMISSORY NOTE
$50,000,000.00
Bertelsmann, Inc. (the "Borrower"), a Delaware corporation, for value
received, hereby unconditionally promises to pay to the order of Bayerische
Landesbank Girozentrale (the "Bank") at its office located at 560 Lexington
Avenue, New York, New York 10022 the principal sum of $50,000,000.00 (Fifty
Million Dollars), or if less, the unpaid principal amount of all Loans (as
defined in the Agreement referred to below) made by the Bank pursuant to the
Agreement. The Borrower also promises to pay interest on the unpaid balance
thereof, from the date hereof, at said office, in like money, at the rates and
at the times provided in the Agreement.
This Note is issued under and pursuant to the terms and conditions of a
Revolving Credit Agreement dated July 15, 1993, between the Borrower and the
Bank, and is entitled to the benefits thereof.
The Borrower hereby waives presentment, demand, protest or notice of any
kind in connection with this Note.
This Note shall be governed by, and interpreted and construed in
accordance with, the laws of the State of New York.
Bertelsmann, Inc.
By:
---------------------------------
By:
---------------------------------
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EXHIBIT B
Sample Calculation for Prepayment
Assume:
Loan Amount = $10,000,000
Interest Rate = 3.5%
Interest Period = 30 days
Prepayment Period = 10 days
Reinvestment Interest Rate = 3.0%
a) $10,000,000 x .035 x (10/360) = $9,722.22
b) $10,000,000 x .03 x (10/360) = $8,333.33
a) - b) = $9,722.22 - $8,333.33 = $1,388.89
$1,388.89 $1,388.89
PV = ------------------------- = ------------- = $1,387.78
1 + (.03 x (10/360)) 1.0008
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EXHIBIT C
COMFORT LETTER
Ladies and Gentlemen,
We have taken note that you have placed at the disposal of our subsidiary
Bertelsmann, Inc. a revolving credit facility in the amount of fifty million
dollars (USD 50,000,000.00).
We confirm to you that the majority of the outstanding voting stock of
Bertelsmann, Inc. is held by us. It is not our intention to reduce or dispose
of our holding in Bertelsmann, Inc. during the validity of the above-mentioned
credit facility. Should a change take place, however, we undertake to inform
you thereof well in advance in order that adequate security of your claims may
be agreed upon.
We shall continue to exercise all our influence over Bertelsmann, Inc. in an
effort to ensure that all obligations arising from the above-mentioned credit
facility can be fulfilled.
BERTELSMANN AG
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EXHIBIT D
GUARANTEED DEBT SCHEDULE
BERTELSMANN, INC., NEW YORK, NEW YORK
5-YEAR EVERGREEN REVOLVING CREDITS AS OF THIS DATE:
1. Deutsche Bank $50MM Guaranteed by Bertelsmann AG (1987)
2. Westdeutsche Landesbank $30MM Guaranteed by Bertelsmann AG (1987)
3. Commerzbank $80MM Patronatserklaerung of Bertelsmann AG (1987)
4. Dresdner Bank $lOMM Comfort Letter of Bertelsmann AG (1990)
5. Chemical Bank $20MM Comfort Letter of Bertelsmann AG (1991)
MA:pk
BERTELS
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FIRST AMENDMENT
FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT (the "First Amendment"),
dated as of July 27, 2000, by and between Bertelsmann, Ire. (the "Borrower")
and Bayerische Landesbank Girozentrale (the "Bank"). All capitalized terms used
herein and not otherwise defined shall lave the meanings ascribed to them in
the Agrecinent referred to below.
WITNESSETH:
WHEREAS, the Borrower and the Bank have entered into a Revolving Credit
Agreement, dated as off July 15, 1993 (the "Agreement"); and
WHEREAS, the parties hereto wish to amend the Agreement as herein
provided.
NOW, THEREFORE, it is agreed:
1. Article 2, subsection (b) of the Agreement is hereby amended by
deleting the entire subsection and inserting the following language in lieu
thereof;
"(b) The Borrower will use the proceeds of the Loans for general
corporate purposes and the use of the Loans shall not result it any
violation of Regulation U of the Board of Governors of the Federal
Reserve System."
2. This First Amendment shall become effective on the date hereof (the
"Amendment Effective Date") upon the delivery by the Borrower and the Bank of
executed copies hereof.
3. From and after the Amendment Effective Date, all references in any
document to the Agreement shall be deemed to be references to the Agreement as
amended hereby.
4. In order to induce the Bank to enter into this First Amendment, the
Borrower hereby represents and warrants that each of the representations,
warranties and agreements contained in the Agreement are true and correct in
all material respects on the Amendment Effective Date, after giving effect to
this Amendment (except for any representations or warranty which expressly
indicates that it is being made as of a specific date, in which case the
Borrower represents and warrants that such representation or warranty was true
and cornet in all material respects and as of such specifio date).
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5. This First Amendment is limited as specified and shall not constitute a
modification, acceptance or waiver of any othcr provision of the Agreement.
6. This First Amendment may be executed by one or more parties to this
First Amendment on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. A complete set of counterparts shall be lodged with the Borrower
and the Bank.
7. THIS FIRST AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED TN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF NEW YORK.
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this First Amendment to be duly executed and delivered as of the date first
above written,
BERTELSMANN, INC.
By:
-----------------------------------
Name: Robert J. Sorrentino
Title: President and CEO
BAYERISCHE LANDESBANK GIROZENTRALE
By:
-----------------------------------
Name: Peter Obermann
Title: Senior Vice President
By:
-----------------------------------
Name: Alexander Kohnert
Title: First Vice President
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First Amendment dated May 5, 1999, to Revolving Credit Agreement,
dated as of July 15, 1993, by and between
Bertelsmann, Inc. (The "Borrower"), and
Bayerische Landesbank Girozentrale (the "Bank").
A. It is hereby agreed by the Borrower and the Bank to amend the Revolving
Credit Agreement as follows:
(1) Section 1.04.(a)(i) shall read as follows: Each LIBOR Loan shall
bear interest at the sum of the LEBO Rate for such Interest Period plus
.25% per annum. Interest Period means the period commencing on the date of
such Loan and ending on the last day of the period selected by the
Borrower. The duration of each such Interest Period shall be one, two,
three or six months, in each case as the Borrower may select.
(2) Section 1.06. shall read as follows: The Borrower agrees to pay
to the Bank a commitment fee of. 10% per annum on the average daily unused
portion of the Facility (computed on the basis of the actual number of
days elapsed in a year of 360 days). The Commitment Fee shall be payable
in arrears, on the last day of each calendar quarter commencing September
30, 1999, and on the Maturity Date.
Each amendment shall become effective as of July 15, 1999.
B. All other terms and conditions of the above referenced Revolving Credit
Agreement remain unchanged.
BAYERISCHE LANDESBANK GIROZENTRALE,
acting through its Cayman Islands Branch
By: By:
------------------------------------ --------------------------------
Peter Obermann Oliver Hildenbrand
Senior Vice President Second Vice President
ACKNOWLEDGED AND AGREED TO BY:
BERTELSMANN, INC.
By:
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Name: Bernhard Derlath
Title: Vice President Finance and Controller