EXECUTION COPY
AMENDMENT NO. 2 AND WAIVER
TO
AMENDED AND RESTATED CREDIT AGREEMENT
AMENDMENT NO. 2 dated as of December 30, 1998 of the Amended and
Restated Credit Agreement dated as of April 29, 1998 (as heretofore amended, the
"Amended and Restated Agreement") among United Asset Management Corporation, a
Delaware corporation (the "Borrower"), the banks listed on the signature pages
thereof, Morgan Guaranty Trust Company of New York, as Administrative Agent (the
"Administrative Agent"), and BankBoston, N.A., as Collateral Agent (the
"Collateral Agent").
WHEREAS, the Borrower proposes to (i) (A) form a subsidiary named
Heitman Newco, Inc. and organized as a corporation under the laws of the State
of Delaware ("Heitman Newco"), (B) cause Heitman Newco to form a subsidiary
named Heitman Financial L.L.C. and organized as a limited liability company
under the laws of the State of Delaware ("Heitman LLC"), with Class B membership
interests to be owned by Heitman Newco and Class A membership interests to be
owned by a limited liability company owned by certain employees of Heitman
Financial Ltd., an Illinois corporation and a Subsidiary of the Borrower
("Heitman"), (C) cause each of the Subsidiaries of Heitman to be converted into
a limited liability company (by merger of such Subsidiary into a limited
liability company formed solely for the purpose of converting such Subsidiary
into a limited liability company), (D) transfer all of the capital stock of
Heitman to Heitman Newco, (E) cause Heitman to merge into Heitman LLC (all of
the foregoing transactions, the "Heitman Reorganization"); (ii) pledge 100% of
the issued and outstanding capital stock of Heitman Newco to the Collateral
Agent; (iii) cause Heitman Newco to become a Guaranty Subsidiary and grant a
first priority security interest to the Collateral Agent in all Class B
membership interests of Heitman LLC; and (iv) cause Heitman LLC to confirm its
obligations under the Heitman Guaranty and grant a security interest to the
Collateral Agent in all limited liability company membership interests of the
successors pursuant to the Heitman Reorganization to the Subsidiaries whose
capital stock was pledged under the Heitman Pledge Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Definitions.
(a) Unless otherwise specifically defined herein, each term used
herein which is defined in the Amended and Restated Agreement shall have the
meaning assigned to such term in the Amended and Restated Agreement.
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(b) The definition of Heitman Pledge Agreement is deleted from Section
01 of the Amended and Restated Agreement.
(c) The following definitions are added to Section 1.01 of the Amended
and Restated Agreement in the appropriate alphabetical order:
"Class A Membership Interests" means the Class A membership
interests of Heitman.
"Equity Interest" means (i) in the case of a corporation, any
shares of its capital stock, (ii) in the case of a limited liability
company, any membership interest therein, (iii) in the case of a
partnership, any partnership interest (whether general or limited)
therein, (iv) in the case of any other business entity, any
participation or other interest in the equity or profits thereof or (v)
any warrant, option or other right (including in any conversion feature
in any security) to acquire any Equity Interest described in the
foregoing clauses (i), (ii), (iii) and (iv).
"Heitman Security Agreement" means the Security Agreement,
dated as of the effective date of Amendment No. 2 dated as of December
30, 1998 to the Amended and Restated Agreement, between Heitman and the
Collateral Agent.
"Heitman Newco" means Heitman Newco, Inc. (to be renamed
Heitman Financial Ltd.), a Delaware corporation, and its successors.
"Heitman Newco Security Agreement" means the Security
Agreement, dated as of the effective date of Amendment No. 2 dated as
of December 30, 1998 to the Amended and Restated Agreement, between
Heitman Newco and the Collateral Agent.
(d) The definition of "Collateral Documents" in Section 1.01 of the
Amended and Restated Agreement is amended by replacing the words "the Heitman
Pledge Agreement" with the words "the Heitman Security Agreement, the Heitman
Newco Security Agreement".
(e) The definition of "Heitman" in Section 1.01 of the Amended and
Restated Agreement is amended to read in its entirety as follows:
"Heitman" means Heitman Financial L.L.C., a Delaware limited
liability company and a Subsidiary of the Borrower and successor to
Heitman Financial Ltd., an Illinois corporation, and its successors.
(f) Exhibit F of the Amended and Restated Agreement is amended by
adding the following:
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7. Heitman Newco Guaranty, dated as of the effective date of Amendment
No. 2 dated as of December 30, 1998 to the Amended and Restated
Agreement, made by Heitman Newco in favor of the Beneficiaries named
therein.
(g) Exhibit G of the Amended and Restated Agreement shall be replaced
by a new Exhibit G prepared by the Borrower and in form and substance
satisfactory to the Administrative Agent to reflect the Heitman Reorganization.
SECTION 2. Waiver and Consent. The undersigned Banks hereby waive any
breach by the Borrower of Section 5.07 of the Amended and Restated Agreement to
the extent such breach arises out of the Borrower's transfer of the capital
stock of Heitman to Heitman Newco and the merger of Heitman into Heitman LLC.
Promptly after the Amendment Effective Date, the Collateral Agent shall return
to the Borrower the stock certificates issued by Heitman Financial Ltd. and
pledged under the Pledge Agreement and the stock certificates pledged under the
Heitman Pledge Agreement. The undersigned Banks hereby instruct the Collateral
Agent to execute on the Amendment Effective Date the documents described in
clauses (b), (d) and (f) of Section 8 of this Amendment.
SECTION 3. Representations and Warranties. Section 4.11(a) of the
Amended and Restated Agreement is amended by deleting the words "the Heitman
Pledge Agreement" from the first sentence thereof.
SECTION 4. Maintenance of Existence. Section 5.04 of the Amended and
Restated Agreement is amended by adding the words "or other" after each
occurrence of the word "corporate" and by replacing the word "corporation" with
the word "Person".
SECTION 5. Investments. Section 5.15 of the Amended and Restated
Agreement is amended by adding the following as subsection (a-2):
(a-2) Investments in Heitman Newco and Heitman;
SECTION 6. Issuance of Additional Equity Interests by Subsidiaries.
Section 5.16 of the Amended and Restated Agreement is amended to read in its
entirety as follows:
SECTION 5.16. Issuance of Additional Equity Interests by Subsidiaries.
(a) The Borrower will not permit any Subsidiary to issue any
additional Equity Interests to any Person other than the Borrower or a
Wholly-Owned Subsidiary. Neither the Borrower nor any Subsidiary will
sell, transfer, pledge or otherwise dispose of any capital stock of a
Subsidiary, other than dispositions in connection with a transaction
permitted by Section 5.07.
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(b) Notwithstanding subsection (a) above, Heitman may issue
the Class A Membership Interests. The Borrower has heretofore delivered
to the Banks a copy of the limited liability company agreement of
Heitman and will not permit such agreement to be amended to increase
the Class A Membership Interests or the rights of the Class A
Membership Interests without the prior written consent of the Required
Banks.
SECTION 7. Pledged Collateral.
(a) Section 5.17(a) of the Amended and Restated Agreement is amended
by adding the following at the end thereof:
; the Borrower will promptly grant a perfected first priority security
interest in or cause a first priority security interest to be granted
in any other Equity Interests of any Subsidiary acquired in a Permitted
Acquisition to the Collateral Agent;
(b) Section 5.17(c) of the Amended and Restated Agreement is amended
to read in its entirety as follows:
(c) Notwithstanding anything to the contrary in this Section, the
Borrower will not be required to pledge (or otherwise grant a security interest
in) (i) the capital stock (or other Equity Interests) of any Subsidiary
identified on Exhibit G hereto as a Special Exempt Subsidiary, (ii) more than
65% of the capital stock (or other Equity Interests) of an acquired Subsidiary
organized outside the United States of America (a "Foreign Subsidiary") which is
owned by the Borrower or a Subsidiary which is not a Foreign Subsidiary, (iii)
any capital stock (or other Equity Interests) of an acquired Subsidiary which is
owned by a Foreign Subsidiary or (iv) any of the capital stock of an acquired
Subsidiary or a Subsidiary formed by the Borrower if such Subsidiary's
consolidated revenues are less than $2,000,000 (an "Exempt Subsidiary");
provided that if, for any fiscal year, the aggregate consolidated revenues of
all Exempt Subsidiaries exceeds $20,000,000, then the capital stock of the
Exempt Subsidiary with the highest consolidated revenue for such year will be
pledged to the Collateral Agent (or, if such Exempt Subsidiary is not a
corporation, then a first priority perfected security interest in all Equity
Interests in such Exempt Subsidiary shall be granted to the Collateral Agent).
This process shall be repeated until the aggregate consolidated revenue of the
remaining Exempt Subsidiaries is less than $20,000,000. For purposes of this
section, the consolidated revenues of each Exempt Subsidiary in each fiscal year
shall be determined in accordance with generally accepted accounting principles
by the Borrower and furnished to the Administrative Agent within 90 days after
the end of the fiscal year of the Borrower.
SECTION 8. Counterparts; Effectiveness. This Amendment may be executed
in one or more counterparts, each of which, when so executed and delivered,
shall be deemed to be an original and all of which counterparts, taken
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together, shall constitute but one and the same Amendment with the same force
and effect as if the signatures of all of the parties were on a single
counterpart, and it shall not be necessary in making proof of this Amendment to
produce more than one such counterpart. This Amendment shall become effective
upon receipt by the Administrative Agent of the following (the date of such
effectiveness, the "Amendment Effective Date"):
(a) duly executed counterparts hereof signed by the Borrower, the
Collateral Agent and the Required Banks (or, in the case of any party as to
which an executed counterpart shall not have been received, the Administrative
Agent shall have received telegraphic, telex, facsimile or other written
confirmation from such party of execution of a counterpart hereof by such
party);
(b) a duly executed counterpart signed by the Borrower of an amendment
to the Pledge Agreement (amending Schedule A) in form and substance satisfactory
to the Agents;
(c) a duly executed counterpart signed by Heitman Newco of a guaranty
in form and substance satisfactory to the Agents;
(d) a duly executed counterpart signed by Heitman Newco of a security
agreement (relating to the Class B membership interests of Heitman LLC) in form
and substance satisfactory to the Agents;
(e) a duly executed counterpart signed by Heitman LLC of a
confirmation of the Heitman Guaranty in form and substance satisfactory to the
Agents;
(f) a duly executed counterpart signed by Heitman LLC of a security
agreement (relating to the membership interests in certain of its direct
Subsidiaries) in form and substance satisfactory to the Agents;
(g) evidence satisfactory to it that the Heitman Reorganization will
be consummated simultaneously with the effectiveness of this Amendment;
(h) a new Exhibit G to the Amended and Restated Agreement in form and
substance satisfactory to the Administrative Agent and reflecting the Heitman
Reorganization;
(i) an opinion of Hill & Barlow, counsel for the Borrower in form and
substance satisfactory to the Agents;
(j) all documents either Agent may reasonably request (including
additional opinions) relating to the existence of Heitman Newco and Heitman LLC
or the consummation of the Heitman Reorganization, the corporate or other
authority for and validity of any of the documents referred to in clauses (a)
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through (h) above, and any other matters relevant thereto, all in form and
substance satisfactory to the Agents.
SECTION 9. Governing Law. This Amendment shall be governed by, and
construed and enforced in accordance with, the internal laws of the State of New
York (without reference to conflict of laws principles).
IN WITNESS WHEREOF, this Amendment has been duly executed and delivered
as of the date first above written.
UNITED ASSET MANAGEMENT CORPORATION
By: /s/ William H. Park
-----------------------------------
Name: William H. Park
Title: Executive Vice President and
Chief Financial Officer
BANKBOSTON, N.A., as Collateral Agent and Bank
By: /s/ Stewart P. Neff
-----------------------------------
Name: Stewart P. Neff
Title: Managing Director
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By: /s/ Glenda L. Winter-Irving
-----------------------------------
Name: Glenda L. Winter-Irving
Title: Vice President
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DEUTSCHE BANK AG NEW YORK AND/OR CAYMAN ISLANDS BRANCHES
By: /s/ George Ann Tobin
---------------------------------------------
Name: George-Ann Tobin
Title: Managing Director
By: /s/ Jonathan B.P. Mendes
---------------------------------------------
Name: Jonathan B.P. Mendes
Title: Vice President
BANK OF AMERICA NT & SA
By: /s/ John G. Hayes
---------------------------------------------
Name: John G. Hayes
Title: Vice President
THE CHASE MANHATTAN BANK
By: /s/ Gail Weiss
---------------------------------------------
Name: Gail Weiss
Title: Vice President
MELLON BANK, N.A.
By: /s/ W. Scott Sanford
---------------------------------------------
Name: W. Scott Sanford
Title: Senior Vice President
NATIONSBANK, N.A.
By: /s/ Ken Ricciardi
---------------------------------------------
Name: Ken Ricciardi
Title: Senior Vice President
CITIBANK, N.A.
By: /s/ Alexander Duka
---------------------------------------------
Name: Alexander Duka
Title: Vice President
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COMMERZBANK AG NEW YORK BRANCH
By: /s/ Michael P. McCarthy
---------------------------------------------
Name: Michael P. McCarthy
Title: Assistant Vice President
By: /s/ Joseph J. Hayes
---------------------------------------------
Name: Joseph J. Hayes
Title: Assistant Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Sebastian Rocco
---------------------------------------------
Name: Sebastian Rocco
Title: Senior Vice President
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Nicole Holzapfel
---------------------------------------------
Name: Nicole Holzapfel
Title: Vice President
FLEET NATIONAL BANK
By: /s/ Robert W. McClelland
---------------------------------------------
Name: Robert W. McClelland
Title: Vice President
THE ROYAL BANK OF SCOTLAND PLC
By: /s/ Grant Stoddart
---------------------------------------------
Name: Grant Stoddart
Title: EVP The Americas
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PARIBAS
By:
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Name:
Title:
By:
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Name:
Title:
BAYERISCHE HYPO- UND VEREINSBANK, NEW YORK BRANCH
By: /s/ David Lefkovits
---------------------------------------------
Name: David Lefkovits
Title: Managing Director
By: /s/ Debra L. Laskowski
---------------------------------------------
Name: Debra L. Laskowski
Title: Director
THE LONG-TERM CREDIT BANK OF JAPAN, LIMITED, NEW YORK
BRANCH
By:
----------------------------------------------------
Name:
Title:
STATE STREET BANK AND TRUST COMPANY
By: /s/ Edward A. Siegel
---------------------------------------------
Name: Edward A. Siegel
Title: Vice President
THE BANK OF NEW YORK
By: /s/ Robert V. Masi
---------------------------------------------
Name: Robert V. Masi
Title: Vice President
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SOCIETE GENERALE, NEW YORK BRANCH
By: /s/ Dabney Giles Treacy
---------------------------------------------
Name: Dabney Giles Treacy
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By: /s/ David C. Hants
---------------------------------------------
Name: David C. Hants
Title: Vice-President
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